How to get a mortgage in Portugal
When you’re looking for a mortgage in Portugal, there are lots of factors to consider! The process of finding a mortgage to buy a property in another can be quite overwhelming.
By using a mortgage broker, you’ll receive expert advice and access to some of the best mortgage rates from the major Portuguese lenders. They will guide you through the application process, and help you navigate the language barrier too. Please note, at the moment there are no fees chargeable for any advice given in Portugal.
Portuguese mortgages - interest rates and LTVs
At the moment, Portuguese mortgage rates are particularly attractive, with low interest rates:
- Max 80% loan to value
- Max term 40 years
- €60,000 minimum loan
- Rates from 0.873%
Rates now start at 0.873% for a variable rate of up to 80% loan-to-value (based on the purchase price) and 1.2% for a fixed rate of up to 80% loan-to-value.
Interest-only deals are rare so most mortgages are on a repayment basis with the maximum term 40 years. If you are 80 years or older, it is advisable to speak to a mortgage specialist as they are ways for you to obtain a mortgage.
It is worth remembering that monthly mortgage payments will be in Euros and the Sterling rate will vary so it is a good idea to have a currency strategy in place to mitigate any fluctuation if you are paying your monthly mortgage payments from the UK contact A Place in the Sun Currency for more information.
What to know before applying for a mortgage in Portugal
It is worth understanding the lending criteria as early as possible in order to find out how much you can borrow as this will impact the value of properties you search for.
You will also need to understand the purchase costs such as legal fees and taxes, you can read about these in our free Portugal Buying Guide.
Pre-approval on a mortgage will tell you exactly how much you can borrow, at what interest rate and for how long. This sort of preparation will mark you down as a serious buyer when you start speaking to agents and can assist when negotiating on price with the vendor.