Second Chance Law in Spain for Foreign Residents

Debt Relief and a Genuine Fresh Start

Many foreign residents in Spain eventually find themselves overwhelmed by debt: credit cards, personal loans, business losses, or unexpected life changes.
The Spanish Second Chance Law ( Ley 25/2015, de 28 de julio, de mecanismo de segunda oportunidad, reducción de la carga financiera y otras medidas de orden social) a powerful legal solution that allows individuals and self-employed workers to reduce or even fully cancel their debts.

At Costaluz Lawyers, we specialise in guiding English-speaking expats through this process with clarity, protection, and full support from start to finish.

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What Is the Second Chance Law?

The Second Chance Law (“Ley de Segunda Oportunidad”) is a legal mechanism designed for individuals and self-employed persons (autónomos) who can no longer meet their financial obligations in a realistic way. If you are not yet sure which procedure fits your circumstances, start with our overview of help with bankruptcy in Spain.

Through this procedure, it may be possible to:

• Restructure your debts under a realistic payment plan.
• Obtain partial or total cancellation of unsecured debt.
• Stop harassment from banks, credit card companies, and lenders.
• Suspend many enforcement actions and embargoes during the procedure.

Its aim is clear: to give honest debtors in good faith the possibility of a true fresh start and allow them to rebuild their financial life in Spain.

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Why This Service Is Especially Relevant for Foreign Residents

For foreign residents, the Spanish legal and financial system can feel unfamiliar and intimidating. Our service is specifically designed for expats and takes into account:

• Your type of residence in Spain (EU citizen, non-EU, TIE/NIE holders).
• Income and assets located both in Spain and abroad.
• Debts contracted in Spain or in other countries, when they can be connected to Spain.
• Language barriers and lack of familiarity with Spanish courts and insolvency rules.
• Concerns about whether debt issues might affect your immigration status.

We provide a clear, structured process, fully explained in English and adapted to the reality of foreign residents.

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Our Second Chance Team Led by Necker

Our Second Chance practice at Costaluz Lawyers is led by a team of specialised lawyers associated with us and with extensive experience in Spanish insolvency procedures for individuals and self-employed workers.

Over the years, the team have:

• Assisted numerous foreign residents in Spain to obtain full or substantial discharge of their debts.
• Handled complex cases involving income or assets abroad, multiple creditors and mixed personal and business liabilities.
• Guided clients from the first eligibility assessment to the final court resolution, always in clear, accessible English.
• Developed a practical, step-by-step methodology designed to minimise stress and uncertainty for the client.

When you contact us, your case will be assessed personally by our Second Chance team, supervising strategy, documentation and court submissions to maximise your chances of success.

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Who Can Apply?

You may be a good candidate for the Second Chance Law if:

• You are a foreign resident in Spain (EU or non-EU).
• You are self-employed (autónomo) or an individual with significant personal debt.
• You have credit card debt, personal loans, overdrafts, business loans, or unpaid instalments.
• You are genuinely unable to pay your debts in a reasonable timeframe.
• You have acted in good faith and have not been convicted of certain economic crimes.

We always start with a personalised eligibility assessment so you know where you stand before making any decisions.

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What Debts Can Potentially Be Cancelled?

Depending on your case and current legislation, the Second Chance procedure may allow for the cancellation or strong reduction of:

• Credit card debt and revolving credit.
• Personal loans and consumer financing.
• Bank overdrafts and lines of credit.
• Business-related debts arising from your activity as an autónomo.
• Private loans with individuals or companies.
• Part of your debts with the Tax Agency or Social Security, under specific conditions.

Some clients, under the right circumstances, have managed to obtain a discharge of up to 100% of their unsecured debt.

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How We Work: Step by Step

1. Free Eligibility Assessment
   We analyse your financial situation, residency status and type of debts to determine if the Second Chance Law is a suitable solution for you.
2. Strategy and Documentation
   Under the guidance of Necker and the Second Chance team, we design the most appropriate legal route and prepare all required documentation.
3. Filing and Court Procedure
   We file your case before the competent court and represent you throughout the process, ensuring your rights and interests are fully protected.
4. Debt Restructuring or Discharge
   Depending on your situation, we will request the restructuring of your debts or their partial or total cancellation, always aiming for the maximum relief permitted by law.
5. Follow-up and Aftercare
   Once a resolution is obtained, we remain available to advise you on rebuilding your financial life in Spain in a sound and sustainable way.

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Why Choose Costaluz Lawyers

• Long experience advising foreign residents in Spain.
• A dedicated Second Chance team by a spcialist team.
• Clear communication in English at every stage.
• Familiarity with cross-border elements (income and assets abroad).
• Transparent fees and realistic expectations.

Our goal is not only to win your case, but also to guide you through a complex process in a calm, structured and human way.

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Contact Us for a Free Eligibility Assessment

If you are a foreign resident in Spain and feel trapped by your debts, we invite you to contact us for an initial, no-obligation review of your situation.

Contact Us for an Initial Assessment

We will tell you honestly whether the Second Chance Law is an appropriate solution for you and what realistic outcome you can expect.

About CostaLuz Lawyers and the Author

You can read testimonials from hundreds of satisfied clients, going back to 2006, on our website, on Google Reviews and on EyeonSpain.

Reviewed by María de Castro, Abogado no. 2745, Ilustre Colegio de Abogados de Cádiz. CostaLuz Lawyers has supported international buyers since 2006 on EyeonSpain  with guidance and advice on the legal aspects of life in Spain. Included in the lawyers lists of the UK and Ireland embassies. Updated 21 Nov 2025.