Mortgages and their associated costs are once again at the centre of public debate. A ruling issued in November 2025 by Spain’s Tribunal Supremo has strengthened consumer protection by clarifying when mortgage arrangement fees can be considered abusive — and therefore reclaimed, even many years after the loan was signed.
Spain Press Editorial Team
In its decision (Judgment 1621/2025), the Supreme Court declared a 2.17% arrangement fee applied to a mortgage signed in 1999 to be null and void. The court found the percentage to be disproportionate and insufficiently justified, ordering the bank to reimburse the full amount charged to the customer.
An arrangement fee is not untouchable
One of the key points of the ruling is that the arrangement fee does not form part of the essential price of the mortgage contract. This allows it to be subject to an abuse-of-terms assessment under consumer protection legislation.
For years, many banks presented this fee as a standard and automatic cost of granting a mortgage. The court, however, makes clear that it cannot be applied indiscriminately and must meet strict requirements of transparency, proportionality and proper justification.
The percentage matters
When assessing whether a fee is abusive, the Supreme Court refers to prevailing market data. According to these benchmarks, mortgage arrangement fees typically range between 0.25% and 1.5% of the loan amount.
Exceeding this range by a clear margin — as in the case analysed — constitutes, in the court’s view, a significant indication of abusiveness.
In practical terms, this can have a direct financial impact on borrowers. For example, on a €150,000 mortgage, a 2% arrangement fee amounts to around €3,000, which may be recoverable if the legal criteria are met.
Reclaims possible even after the mortgage is repaid
Another important aspect of the ruling is that it makes no difference whether the mortgage is still active or has already been fully repaid. If the clause is declared void, the bank must return the entire fee, with no penalty for the consumer.
Such arrangement fees were particularly common in older mortgages, especially those signed during the 1990s and the early 2000s, when customer information was often limited or unclear.
Transparency must be real, not merely formal
The court stresses that it is not enough for the fee to simply appear in the contract. What matters is whether the borrower truly understood its financial impact at the time of signing and whether the bank can clearly explain which specific services justified the charge.
If these conditions are not met, the contractual clause may be declared null and void.
A ruling with broad implications
Beyond the individual case, this decision consolidates the Supreme Court’s case law and establishes clear criteria that could affect thousands of mortgages across Spain. For many consumers, it represents an opportunity to review their mortgage agreements and assess whether they may be entitled to reclaim fees paid unfairly.
