Release from the obligation to pay debts

Lately, a question we are asked repeatedly is how to secure payment of an existing debt from a consumer or mortgage loan taken out with a consumer credit institution, which typically operate in shopping centres or online. These loans are sold to third parties in debt-collection packages, making it impossible to distinguish fraud from the genuine creditor.

Despite the debtor's efforts to identify the ownership of the loan, this is not always possible, and the debtor being pursued for collection may end up suffering a kind of telephone harassment. These situations tend to go hand in hand with a lack of transparency whenever explanations are requested about the amounts owed, the powers of representation, or the ownership of the debt.

For this situation, the legal system offers us a very useful and sometimes little-known tool, through the Voluntary Jurisdiction Act, which was reformed in 2015: the procedure for judicial deposit of the debt. Through this procedure, after first formally demanding payment from the principal creditor and providing the relevant documentation, the debtor can offer payment through a secure channel. We call it a secure channel because, in order to collect the deposited debt amount, the creditor must prove their status before the Court, as well as the power under which they are acting — something that previously could not be verified with full certainty.

The Court will not only hand over the amount to the creditor but will also declare the debtor released from the debt, and once payment has been made the debtor will be able to obtain a supporting document to prove this wherever necessary.

Since this is very common but there is a wide range of secured and unsecured credit and debt types, please do not hesitate to consult us so we can review the specifics of each case and advise you on the best solution for your situation.