Debt
When you can no longer pay your debts, there is a legal route worth considering.
Spain’s Second Chance Law (Ley de Segunda Oportunidad) allows you, if the requirements are met, to ask a judge to write off debts you cannot pay. Before telling you whether it applies to you, we study your situation in full.
Initial assessment at no cost. Confidential and without obligation.
Common situations
Could this apply to me?
This route is intended for individuals, not companies, who cannot meet their debts. If you recognise yourself in any of these situations, it is worth us looking at it.
- 01You have several debts and the monthly payments no longer fit within your income.
- 02You are paying some debts by taking on others: cards, short-term loans or help from family.
- 03You have stopped paying bills, the mortgage, the rent or your card instalments.
- 04You have been sued, you are on a defaulters’ register, or you fear your assets will be seized.
- 05You are an individual or self-employed, or you closed a business and the debts are still in your name.
What it is
What is the Second Chance Law?
It is a court procedure provided for in Spanish insolvency law for people who cannot pay their debts. It applies to private individuals and the self-employed alike.
Its best-known outcome is the discharge of unpaid debts. Put plainly: the judge declares that the debts you have been unable to pay are no longer enforceable against you, and creditors can no longer claim them.
It is neither automatic nor available for everything. Requirements have to be met, and there are debts the law treats differently. That is why the first step is not filing an application, but studying your situation in full.
- Discharge of unpaid debts
- This is the technical name for the outcome being sought: a court decision declaring that the debts you have been unable to pay are no longer enforceable against you. Creditors can no longer claim them from you.
- Good-faith debtor
- The law does not require you to have been faultless: it defines good faith by exclusion, through a list of circumstances that rule it out (for example, certain recent convictions or serious tax penalties, or having supplied false information). It is a requirement assessed case by case, with your record in front of us.
- With or without liquidation of assets
- There are two routes to a discharge: liquidating the assets you hold, or a repayment plan that allows certain assets to be kept. Which one suits you depends on what you own and what you owe.
Types of debt
Not all debts are treated the same.
The procedure treats each debt according to its origin, who the creditor is and whether there is security behind it. Before proposing anything, we review each contract separately.
Can usually be included
- Personal loans and overdrafts.
- Credit cards, including revolving cards.
- Short-term and instant loans.
- Debts to suppliers, rent and utilities, including those of a business you have closed.
- Personal guarantees you signed for a company’s debts.
Treated differently
- Public-sector debt: tax office, social security and your town hall
- For years it was understood that little of this could be touched. In February 2026 the Spanish Supreme Court clarified three points in your favour: the statutory cap is counted separately against each public body; it reaches any public administration, not only the tax office (Agencia Tributaria) and social security (Seguridad Social) but also the town hall claiming unpaid property tax or your regional government; and surcharges and late-payment interest do not use up that cap, but can be written off in full. One limit is worth being clear about: public-sector debt can only be written off in the first discharge you obtain, not in later ones. How much this affects you depends on what you owe, to whom and on what basis.
- Maintenance payments
- Debts for maintenance are not written off by this route.
- Compensation for personal injury
- Debts for personal injury or death, compensation for accidents at work and occupational illness, and civil liability arising from a criminal offence are all excluded from the discharge. No prior conviction is needed for the debt to be excluded.
- Fines and penalties
- Fines imposed in criminal proceedings and very serious administrative penalties are excluded from the discharge. Other penalties are worth reviewing one by one.
- Costs of the procedure itself
- The legal costs and court fees generated by the discharge application itself are not written off by it. We tell you at the outset so it does not come as a surprise at the end.
- Debts secured by a mortgage or other security
- Debts secured against an asset, such as the mortgage on your home, are treated differently: the security continues to exist over that asset up to the limit of its value. If the debt exceeds that value, the excess can be included in the discharge. What happens to these debts is one of the first things we study.
Your home and assets
What if I own a home or other assets?
Owning assets does not, in itself, rule out the Second Chance route.
Losing the house is the greatest fear of almost everyone who consults us. The law provides for a route with a repayment plan that, in certain cases, allows the main home to be kept while other debts are written off.
Whether that is possible in your case depends on several factors that we study with real figures, not assumptions.
- What the property is worth and how much mortgage is left
- If the mortgage debt is close to or above the value of the property, selling it would give the other creditors nothing. That fact changes the approach considerably.
- Whether you can keep paying the mortgage
- A repayment plan requires that the instalments you keep up are genuinely affordable on your income. A plan you cannot meet is of no use.
- What other assets you have and what you use them for
- A second property is not the same as the vehicle or the tools you work with. Both the law and the courts distinguish between them.
Seizures and court claims
What if I already have a seizure or a claim against me?
Having your wages or your account already seized, or having been sued by a creditor, does not prevent this route from being considered. In fact, it is one of the most common situations people come to us with.
Once the court admits the procedure, the law provides for effects on creditors’ pending claims and enforcement actions. Exactly what happens to each seizure depends on the type of debt and the stage it has reached, and we will explain that for your particular case.
What to do in the meantime
- Do not take out new loans to cover the previous ones: it usually makes things worse.
- Keep all the paperwork: court notifications, claims, demand letters and statements.
- If you have a date set, such as a hearing or an auction, tell us on day one.
How we work
How we study your case
An orderly path from first contact. At each step you know what we are doing and what comes next.
- 01
Tell us your situation
You fill in the questionnaire or speak to us. We need to know, even approximately, how much you owe, to whom, and what income you have.
No cost - 02
We review your debts
We look at them contract by contract: loans, cards, short-term credit, court claims. We check what type each debt is and how the law treats it.
With your paperwork - 03
A professional assesses the options
A lawyer considers whether the Second Chance route is worth pursuing in your case, under which of the two routes, and what would happen to your home or your work. If another route suits you better, we say so.
Human review - 04
We explain it to you in writing
You receive a proposal setting out what we recommend, what it covers and what it costs. You decide in your own time, with no obligation.
Before you engage us
Transparency
You will know before you engage us.
No small print and no surprises halfway through. Before you decide, you will have these four things in writing.
- 01What we propose
- The route we consider worth pursuing in your case, and why. If we think the Second Chance route is not right for you, we will say that too.
- 02What it covers
- What the engagement includes and what it does not, set out before you decide.
- 03What it costs
- The price in writing before you engage us, with the option of paying in instalments.
- 04What we cannot promise
- No outcome is guaranteed in advance. What depends on the court is not ours to promise.
Frequently asked questions
What people usually ask us
Which debts can be written off under the Second Chance Law?
Generally, unsecured debts: personal loans, cards, short-term credit, overdrafts, debts to suppliers, rent or utilities. Some debts have limits or fall outside it, such as part of what you owe to the tax office and social security, maintenance payments, or compensation for personal injury.
Which of your debts qualify can only be established after reviewing them one by one.
Can I keep my home?
It depends on your situation. The law provides for a route with a repayment plan that, in certain cases, allows you to keep your main home while other debts are written off. The value of the property, how much mortgage is left and whether you can keep up the instalments all have a bearing.
We cannot tell you in advance whether you will keep it. We study that with your real figures before proposing anything.
What happens to debts with the tax office and social security?
Less than was believed a few years ago. The Spanish Supreme Court settled the position in February 2026: the statutory cap applies separately to each public creditor, surcharges and late-payment interest do not use up that cap and can be written off in full, and the criterion applies not only to the tax office and social security but also to regional and local administrations. Even so, not all public-sector debt disappears, and it can only be written off in the first discharge you obtain: what you owe and on what basis both matter. If you have public-sector debt, tell us from the outset.
What if my wages or bank account are already being seized?
An existing seizure does not prevent this route from being considered; in fact it is a very common situation. Once the court admits the procedure, the law provides for effects on creditors’ claims and enforcement actions. Exactly what happens to each seizure depends on the type of debt and the stage it has reached.
Can I apply if I am self-employed or guaranteed my company’s debts?
Yes. The law is intended for private individuals and the self-employed alike. If you personally guaranteed loans or credit lines for a company, that debt is in your name and can be considered within the same procedure.
How long does it take?
We cannot give you a timescale in advance. It depends on the court, on which route is followed and on how complete the paperwork is. What we will tell you from the start is which stage you are at and what comes next.
How much does it cost?
The initial assessment is free of charge. If, after studying your case, we propose going ahead, you will receive in writing what the engagement covers and what it costs before you commit. Payment can be made in instalments.