The short answer: a fund buying your debt takes away none of your rights. Same loan, same terms, same defences. Only the person across the table changes. The fund paid less than you owe and usually prefers to be paid soon rather than wait years for an auction. That is your room to negotiate, and an agreed way out can work for both sides.
In this article
- What has happened to your loan
- First step: check who is claiming and who you pay
- Why a fund is often open to a deal
- Your options, from least to most drastic
- Is the fund bound by the Code of Good Practice?
- The litigious credit buy-back: what it is and why it rarely fits
- Common mistakes
- When to get help
- Frequently asked questions
What has happened to your loan
Your bank has assigned the loan: it has sold its right to collect from you (we explain this market in what an NPL is). This is lawful and needs no permission from you. The Spanish Civil Code allows claims to be transferred (article 1112) and regulates assignment without asking for the debtor's consent (articles 1526 onwards). The mortgage travels with the loan, so the fund also becomes the mortgage lender (article 1528).
The Bank of Spain explains on its consumer website that the bank sells the loans for a price well below what is owed, and the terms of your loan stay as they were. Anything you could dispute with the bank, such as an unfair clause, you can dispute with the fund. For sales from 8 October 2026 the law says so expressly: you can raise the same objections and defences against the new owner as against the bank (article 25 bis.1 of Law 5/2019 on real estate credit).
First step: check who is claiming and who you pay
- Ask for proof of the assignment: who the new creditor is, who handles collection and since when. And a broken-down statement of what you owe today.
- Do not pay into an unchecked account. If you paid the bank before you knew of the sale, that payment counts and you are released (article 1527 of the Civil Code). Once told, you pay the new creditor.
- If there is already a court case, the fund must prove with authenticated documents that it has taken the bank's place. If it does not, or they are not enough, the court lets you see them, calls both sides to a hearing and decides (article 540 of the Civil Procedure Act). If the case was already under way when the loan was sold, you have ten days to put your arguments (article 17.1).
Why a fund is often open to a deal
The fund bought your loan at a discount and its business is to recover more than it paid, quickly. Enforcement is slow, costly and ends in an auction with an uncertain result. So funds often accept deals a bank would refuse. Nothing is guaranteed, but there is a shared interest: closing the file.
"A fund is usually more interested in collecting a fair amount than in keeping your house."
Your options, from least to most drastic
1. A discount or a lump-sum settlement
If you can raise a sum (savings, family help, other financing), you can offer to pay less than you owe in exchange for cancelling the whole debt. Get it in writing that the payment settles everything and that the fund will cancel the mortgage. Ask first about the tax effect of the amount written off.
2. A payment plan or restructuring
If your income allows it, you can agree to clear arrears in stages, extend the term or pay a lower instalment for a while. Make sure you can genuinely afford it: a plan that fails after three months leaves you worse off.
3. Selling the house yourself, within an agreed deadline
An ordinary sale almost always fetches more than an auction. You can agree with the fund a deadline to sell, with enforcement on hold meanwhile, and a figure at which it cancels the mortgage. Anything left over is yours.
4. Handing over the property (dación en pago)
You hand the home over and the debt is cancelled. The agreement must say the cancellation is total: if the house is worth less than the debt, without that clause you could still owe the difference. On tax, the gain is exempt from income tax (article 33.4.d of the Income Tax Act) and from the local plusvalía municipal (article 105.1.c of the Local Finance Act) when it is your main home and you lack other assets to pay the debt. Check it before signing.
5. Staying on as a tenant
Some handovers come with a tenancy afterwards. Spain's Code of Good Practice provides for two years of rent at 3% of the debt per year (section 3 of the Annex to Royal Decree-law 6/2012), but it only applies if your bank or the fund signed up to it, and only if you qualify. Otherwise it is negotiated.
6. If there is no agreement
The fund can enforce the mortgage. To call in the whole loan, the law requires arrears of at least 3% of the capital or twelve instalments in the first half of the term, or 7% or fifteen in the second half, plus a prior demand giving you at least a month to pay (article 24 of Law 5/2019). If it is your main home, you can release it before the auction closes by paying the arrears (article 693.3 of the Civil Procedure Act). More in my house is going to auction: what can I do and in the family home in a mortgage enforcement.
Is the fund bound by the Code of Good Practice?
Not necessarily. The Code in Royal Decree-law 6/2012 is voluntary (article 5.1). But if your bank had signed up, the Code is part of your loan and you can rely on it against the fund that buys it: that has been the rule since November 2022 (article 5.7). What is new: for assignments made from 8 October 2026, overdue loans of borrowers already covered by those measures cannot be sold (article 25 bis of Law 5/2019). If it is your main home and you qualify, you have six months from notice of the sale to prove it, and the bank would have to buy the loan back. This rule comes from an October 2026 royal decree-law still awaiting a vote in Parliament, so check its status.
The litigious credit buy-back: what it is and why it rarely fits
You may have heard that you can cancel your debt by paying what the fund paid. This comes from article 1535 of the Civil Code: if a litigious claim is sold, the debtor can extinguish it by paying the buyer the price, the costs and interest, within nine days of the buyer demanding payment.
The Spanish Supreme Court reads it very narrowly. There must be a court case on whether the debt exists or is enforceable, defended and without a final judgment at the time of the sale. And it does not apply when the loan was sold as part of a portfolio for an overall price (judgments 151/2020, 505/2020 and 276/2026). And many mortgages are sold exactly that way. It may be worth a look in a particular case, but it is no basis for a strategy.
Common mistakes
- Not opening the letters. Deadlines run anyway, and silence closes doors.
- Agreeing over the phone. Get the deal in writing, signed and stating which debt is cancelled: what is agreed over the phone is very hard to prove.
- Signing a handover that leaves part of the debt alive. The costliest mistake.
When to get help
When the assignment letter arrives and you are behind, when a claim has been filed, or when the fund offers something and you cannot tell if it is fair. At Equus Capital, in Valencia, we work in this market and know how funds value a debt. We review your case and can negotiate with the fund. We promise no outcome, but we will tell you plainly how much room there is.
Frequently asked questions
Can my bank sell my mortgage without my permission?
Yes. Assigning a claim does not require the debtor's consent (articles 1112 and 1526 onwards of the Spanish Civil Code). Your terms and your defences stay the same.
What if I keep paying the bank after the sale?
If you paid before you knew of the assignment, the payment counts and you are released (article 1527 of the Civil Code). Once told, pay the new creditor after checking the details.
Can I pay what the fund paid for my debt?
Only through the litigious credit buy-back in article 1535, which the Supreme Court reads very strictly. It rarely fits.
Will a fund accept a discount?
Often, yes, because it bought the debt at a discount. It depends on your case and nothing is guaranteed.
Can I stay in the house if I hand it over?
A tenancy after the handover can be agreed. The Code of Good Practice provides for two years, but it only applies if your bank or the fund signed up to it; otherwise it is negotiated.