When you take out a mortgage, it is common for the bank to offer you a life insurance policy. The problem arises when you are not given a choice and are required to take out the bank’s own policy.
This is exactly what the Spanish Supreme Court has recently examined. In this case, the bank required the borrower to take out a life insurance policy with an insurance company belonging to the same corporate group and to pay the entire premium upfront, financing it through the mortgage itself.
The Supreme Court held that this practice may be unfair because the consumer was not free to choose another insurer and, in addition, the true cost of the insurance was not properly reflected in the mortgage.
Thinking of buying a property? At ABOGADAS LANCELOT, we carefully review all the legal documentation before you sign, helping you buy with confidence and avoid costly surprises.
Source: Noticias Jurídicas. Read the full article here: