The Royal Decree-Law 26/2020, of July 7, on economic reactivation measures to address the impact of COVID-19 in the areas of transport and housing, was published in the Official State Gazette (BOE) on July 8, 2020, with effects from July 9, which, among other measures, extends the mortgage moratorium, on non-mortgage loans and consumer loans, rental contracts for primary residences and the social bonus on basic supplies (water, electricity and gas) until September 30, 2020.
The Royal Decree-Law 26/2020, of July 7, on economic reactivation measures to address the impact of COVID-19 in the areas of transport and housing, was published in the Official State Gazette (BOE) on July 8, 2020, and with effect from July 9, 2020. Among other measures, it extends the mortgage moratorium, on non-mortgage loans and consumer loans, rental agreements for primary residences and the social bonus on basic supplies (water, electricity and gas) until September 30, 2020.
This law, in its eighth and ninth final provisions, allows for the extension of several social measures enacted during the Covid-19 pandemic to help the most vulnerable people. These measures consist primarily of three packages: the first aims to alleviate mortgage financial burdens; the second relates to rent; and the third covers basic utilities (water, electricity, and gas).
These aid measures were already included in the so-called "social shield" implemented by the Government during the most acute phase of the pandemic, but with a programmed validity, which ended on July 21, a month after the end of the state of alarm.
Extension of the mortgage moratorium, on non-mortgage loans and consumer loans
The extension of the application period for the mortgage debt moratorium for the acquisition of primary residences or properties related to the economic activity carried out by entrepreneurs and professionals can be requested until September 29 and will last for three months.
Once the moratorium is granted, the creditor will notify the Bank of Spain of its existence and duration. Amounts that would be due from the debtor had the moratorium not been applied will not be considered due. No interest will accrue during the suspension period.
The application of the suspension will not require an agreement between the parties, nor any contractual novation, to take effect, but it must be formalized in a public deed and registered in the Property Registry.
The legal deferral and the one offered by the banking sector can be enjoyed consecutively, so that people who take advantage of both moratoria will benefit from three more months without payment obligations of any kind and another 9 months under market conditions, that is, probably without forgiveness of interest.
When the financial institution grants, simultaneously or successively, a legal moratorium and a conventional moratorium, the conventional moratorium agreement signed with the debtor will expressly include the recognition of the legal moratorium, suspending the effects of the conventional moratorium until the time when the former ends.
Rentals
The extraordinary extension of residential lease agreements can be requested until September 30th, with a duration of 6 months and under the same conditions initially agreed.
In residential lease agreements governed by Law 29/1994 of November 24, on Urban Leases, where the mandatory or tacit renewal period ends between July 9 and September 30, 2020,the tenant may request an extraordinary extension of the lease term for a maximum period of six months, during which the terms and conditions of the existing agreement will continue to apply. This request for an extraordinary extension must be accepted by the landlord, unless other terms and conditions are agreed upon by both parties.
The last day of September will also mark the deadline to request an extraordinary deferral in the payment of rent when it comes to landlords considered as large housing owners or public companies, understood as the natural or legal person who owns more than ten urban properties, excluding garages and storage rooms, or a constructed area of more than 1,500 m2.
Supplies
Exceptionally, until September 30, 2020, the supply of electricity, petroleum products, including manufactured gases and liquefied petroleum gases, natural gas and water to individual consumers in their usual residence may not be suspended for reasons other than the security of supply, of persons and of facilities, even if such possibility is stated in the supply or access contracts signed by consumers in accordance with the sector regulations that apply to them in each case.
To prove to the supplier that the supply takes place in the usual residence, the consumer may use any documentary means that reliably proves this circumstance.
Credits
The suspension of obligations arising from non-mortgage-backed credit agreements is approved.
Once the suspension request has been submitted and the situation of economic vulnerability has been verified, the creditor will proceed with the automatic suspension of the obligations arising from the unsecured loan. The application of the suspension will not require an agreement between the parties to take effect, nor any contractual novation. However, if the loan is secured by a registrable right other than a mortgage or has been registered in the Registry of Installment Sales of Movable Property, registration of the extension of the term resulting from the suspension will be necessary
Once the suspension has been applied, the creditor will notify the Bank of Spain of its existence and duration. Amounts that would be due from the debtor had the moratorium not been applied will not be considered due. The suspension will last for three months, extendable by a Council of Ministers agreement.
Social bonus
Furthermore, in order to standardize the duration of social measures and prevent their withdrawal from occurring in a disorderly manner, the validity of the social bonus is automatically extended until September 30 for those beneficiaries whose bonus expires before that date
You can contact this professional office for any questions or clarifications you may have.
Warm regards,
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A Àmbit Assessor, SL has 40 years dedicated to the tax, comptable and labor consultancy of the Pime.
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