How can you get a mortgage to buy in Portugal? As foreign buyers purchased for more than 5 billion euros worth of Portuguese real estate last year, acquiring 35,000 Portuguese properties, it seems more important than ever to help foreigners find qualified information on mortgages, as well as taxes and costs.
If you want to get help for this, contact MortgageDirect, leading independent broker for Spain and Portugal.
To answer this question, we discussed with several bankers who attended the Portuguese Real Estate and Tourism Fair in Paris:
- CIC Iberbanco
- Santander
- CaixaBank
- Caixa Geral de Depositos
Before we get into details, know that you have two options:
- Get a mortgage in your Home Country
- Get a mortgage in Portugal
Should you take a mortgage in your home country or in Portugal?
Now that you know that the two options are available, how can you decide whether you should take a loan in your home country, or in Portugal? Here is a summary of the conditions you will get in each country, to help you decide what’s best for you.
To make it interesting, we compared France and Portugal here below, because French buyers were the #1 nationality of foreign buyers in Portugal last year, with 1.1 billion euros invested. However, you may consider only the column below for Portugal, and compare it with mortgage conditions that you would obtain in your home country, whether it’s the United Kingdom, Brazil, Switzerland or any other country.
Mostly, we can learn that:
- Portugal grants loans of up to 40 years
- Variable interest rates is the norm (although you can get fixed interest rates too)
- Portuguese banks will finance up to 70% of the property value
Below you will find a summary of these conditions, based on our discussions with 5 different banks at the Portuguese Real Estate Fair in Paris:
| Mortgage in France | Mortgage in Portugal | |
| Max. duration of the loan | 25 years | 40 years |
| Fix or variable? | Fixed interest rate | Variable interest rate |
| Debt ratio | 33% | 50% |
| Loan as % of property value | 110% | 70% |
| Interest rate | 1.80% to 2.00% | Aligned on EURIBOR |
Looking for good bankers?
Before browsing for properties, it can be a good option to pre-validate your budget and conditions (interest rate, duration) with several bankers. Indeed, having the finances secured first, will only make it easier to buy. Check our directory of key contacts to buy overseas, and if we don’t have yet the contact you’re looking for, get in touch and we will help you find what you’re looking for!