Bank guarantee for renting in Spain: costs and legality of extra deposits
Itemized costs of a bank guarantee for renting in Spain (€32 setup fee, €27 quarterly) and the legal debate over whether additional cash deposits are abusive.
English · Original discussion in Spanish · Published
Bank guarantee for renting: what it costs and whether asking for extra deposit is legal
Bank guarantees have been a headache for tenants for decades. In the mid-2000s, when the rental market began to tighten, demands for additional guarantees multiplied. Based on testimonies from tenants and real estate law experts of the time, the real cost of a bank guarantee can be reconstructed and the legal debate over extra deposits unraveled.
How much does a bank guarantee really cost?
Contrary to the belief that the bank holds the full amount, there are guarantees that do not freeze your money. A detailed example: a €3,600 guarantee (half the annual rent) with a 0.9% setup fee (€32.40), a quarterly cost of 0.75% (€27 every three months) and €12 in notary fees. In total, just over €150 a year, manageable if negotiated with the landlord. However, other guarantees —especially "first demand" ones— block the amount in an account, and releasing it depends on the landlord returning the original document. This has led to cases where a tenant could not recover the money for months.
The legal battle over additional deposits
One of the thorniest points is whether the landlord can demand, on top of the legal deposit (one month unfurnished, two furnished), an extra amount in cash. While one camp argues that any deposit above that is illegal and constitutes an abusive clause, another —backed by the LAU (Spain's Urban Leases Act) and manuals such as Memento Francis Lefebvre— claims the law allows "any type of additional guarantee beyond the cash deposit." There have even been cases of landlords asking for 6 months' deposit, something some consider abusive and others a legal, if inadvisable, practice. The discussion even reached the Community of Madrid, where a phone inquiry failed to clarify the official position.
The conclusion: a bank guarantee is not always the trap it seems, but it requires reading the fine print and negotiating terms. As for extra deposits, the legal consensus suggests they are valid, although tenants have room to refuse them or look for alternatives. The lack of clear case law keeps the debate open.
Related forum discussions
Bank guarantees have been a headache for tenants for decades. In the mid-2000s, when the rental market began to tighten, demands for additional guarantees multiplied. Based on testimonies from tenants and real estate law experts of the time, the real cost of a bank guarantee can be reconstructed and the legal debate over extra deposits unraveled.
How much does a bank guarantee really cost?
Contrary to the belief that the bank holds the full amount, there are guarantees that do not freeze your money. A detailed example: a €3,600 guarantee (half the annual rent) with a 0.9% setup fee (€32.40), a quarterly cost of 0.75% (€27 every three months) and €12 in notary fees. In total, just over €150 a year, manageable if negotiated with the landlord. However, other guarantees —especially "first demand" ones— block the amount in an account, and releasing it depends on the landlord returning the original document. This has led to cases where a tenant could not recover the money for months.
The legal battle over additional deposits
One of the thorniest points is whether the landlord can demand, on top of the legal deposit (one month unfurnished, two furnished), an extra amount in cash. While one camp argues that any deposit above that is illegal and constitutes an abusive clause, another —backed by the LAU (Spain's Urban Leases Act) and manuals such as Memento Francis Lefebvre— claims the law allows "any type of additional guarantee beyond the cash deposit." There have even been cases of landlords asking for 6 months' deposit, something some consider abusive and others a legal, if inadvisable, practice. The discussion even reached the Community of Madrid, where a phone inquiry failed to clarify the official position.
The conclusion: a bank guarantee is not always the trap it seems, but it requires reading the fine print and negotiating terms. As for extra deposits, the legal consensus suggests they are valid, although tenants have room to refuse them or look for alternatives. The lack of clear case law keeps the debate open.
Related forum discussions
- Frozen wages and everything super expensive, Spain · 287 replies
- Sharp landlords who don't return the deposit · 50 replies
Summary of a discussion on Burbuja.info - Foro de economía, actualidad y política., translated from Spanish and reviewed before publication. Read the full discussion (68 replies).
More summaries
-
Madrid metro ads promote study visas to bring relatives to Spain
The Madrid regional government allows metro ads inviting relatives to Spain on student visas, intensifying Spain's migration debate.
-
Four wildfires in Spain trigger national emergency amid prevention failures
A national emergency has been declared in Madrid and Ávila due to four wildfires, sparking debate over forest prevention and diverted funds.
-
Ignacio Lázaro: 'Maricarmen paid €154 rent while we paid €750'
Ignacio Lázaro, grandson of the original owner, reveals the other side of the Maricarmen case: 'We subsidized her for years and now, with our taxes.'
-
Porsche halts Taycan production as luxury EV demand dries up
Porsche has suspended Taycan production. The luxury electric car market is collapsing due to a lack of real demand and the unsustainability of residual values.
-
A statistic I've been compiling for 25 years across Spain's regions. Real data inside
A sociological analysis of regional affinity in Spain: data from 25 years of observation on temperament and interpersonal trust.
-
Terrorist cell planning an attack in Spain dismantled in Mallorca
A jihadist cell has been dismantled in Mallorca, Spain, with no imminent threat. A genuine operation or a political distraction? An analysis of the economic cost and public skepticism.