Spain court favours mortgage debtor over bank

MADRID Jan 26 (Reuters) - A Spanish court has ruled that a debtor who handed over property to a bank with which he had a mortgage was not liable for outstanding debts, Spanish media reported on Wednesday.

El Mundo daily posted a link to what it said was a ruling by a court in the northern city of Pamplona on Dec. 17. The names of the parties in the dispute were removed.

State television broadcaster TVE named the former debtor as Jose Antonio Langarita.

"From owing 28,000 euros ($38,310) to not having to pay makes a worker like me very happy," Langarita told TVE.

Manuel Pardos, president of the Association of Bank and Insurance Users (Adicae), welcomed the decision.

"Spanish mortgage law has to be changed because it was open to abuse. The valuation when they gave you the mortgage was completely different, as in the case of Pamplona, to what they were giving now," Pardos told TVE.

Spanish banks lent heavily during an 11-year property boom which went bust in 2008. (Reporting by Raquel Castillo. Editing by Robert MacMillan)