Source: Adobe Stock Author: Redaction Before approving a mortgage, banks in Portugal require the property to be appraised by certified experts. This bank appraisal, often unknown to buyers, is a mandatory step in the process of obtaining financing. The main goal is to ensure that the propertys value aligns with the amount of credit requested, ensuring that the property will serve as adequate collateral in case of loan default. The appraisal process begins after the credit application is submitted to the bank. The bank appoints an independent appraiser, who conducts a detailed analysis of the property, considering factors such as location, size, condition, and the prices of similar properties in the region. Based on these criteria, the expert determines the propertys market value. This value is crucial, as it determines the percentage of financing the bank will grant. Typically, financial institutions finance between 80% and 90% of the lower value between the purchase price and the appraisal value. If the property is appraised at a value lower than the purchase price, the buyer will have to cover the difference with their own funds. The appraisal has costs, ranging from €200 to €400, depending on the location and type of property. This fee is paid by the client, regardless of whether the loan is approved or not. Furthermore, the appraisal process can influence the banks final decision on granting the credit, potentially leading to the need to renegotiate the loan amount or terms. Although it is a mandatory step, the bank appraisal can be advantageous for buyers, serving as protection against purchasing an overvalued property. However, it can also be an obstacle for those who struggle to cover the difference when the appraisal falls short of expectations. The bank appraisal is an essential and mandatory step in the mortgage process in Portugal, ensuring that both the bank and the buyer are protected in a constantly evolving real estate market.
Source: Adobe Stock Author: Redaction Many Portuguese are unaware that transferring their mortgage to another bank can result in significant savings over the course of the contract. With rising interest rates and financial pressure on families, mortgage transfers have become an effective solution to reduce monthly payments and, in some cases, save thousands of euros over the total loan. This process, also known as mortgage portability, allows the borrower to transfer their loan to another bank that offers more advantageous conditions, such as lower interest rates or the elimination of some fees. With increasing competition between banks, many institutions are offering more attractive packages to attract new clients, creating interesting opportunities for those looking to renegotiate their mortgage. Before proceeding with the transfer, clients should carefully analyze the conditions offered by the new bank, comparing interest rates (fixed or variable), repayment terms, and any associated fees. Changing banks may involve some initial costs, such as transfer fees and expenses related to the new deed, but these costs are often quickly offset by the savings generated in the medium and long term. Furthermore, the original bank may apply a penalty of up to 0.5% on the outstanding balance for variable-rate mortgages or up to 2% for fixed-rate loans. However, the accumulated savings from the reduced interest rates can outweigh these initial costs. According to financial experts, transferring a mortgage can be particularly beneficial for loans with high interest rates. Depending on the conditions, customers can save several hundred euros per year, and in long-term contracts, savings can reach thousands. In times of economic uncertainty, with inflation squeezing family budgets, exploring mortgage transfer options can be a smart strategy for those looking to reduce their financial burden and increase budget flexibility. Experts recommend that consumers seek information from various institutions and compare offers to secure the best possible deal. If you have an active mortgage, it’s worth reviewing its terms and considering whether transferring to another bank could be the key to substantial savings.
Source: Adobe Stock Author: Redaction With the rising cost of living and inflation putting pressure on the budgets of Portuguese families, the government has implemented various support measures for workers earning the national minimum wage. These aids aim to alleviate the impact of essential expenses such as food, housing, and energy, ensuring that those with lower incomes receive some financial relief. Salary supplement One of the main measures is the Annual Salary Supplement, aimed at low-income workers. This support consists of an extraordinary payment at the end of the year, calculated based on the number of months worked and annual income. The goal is to complement the minimum wage, providing financial reinforcement for additional expenses. Housing subsidy The Rent Support Program is another available mechanism. Intended for those who have difficulty paying their rent, this subsidy aims to support families living in rented accommodation who face financial difficulties due to rising real estate prices. Energy support Minimum wage earners can also benefit from the Social Energy Tariff, which offers a significant discount on electricity and gas bills. This measure is automatic, applied directly by energy providers, without the need for consumers to request it. Public transport discounts Another important support is the Social+ Pass, which offers discounts on public transport for low-income individuals. This measure is essential for workers who depend on public transport daily and helps to significantly reduce travel expenses. Food support With rising food prices, the government has strengthened support through the Food Support Program, in partnership with charitable institutions. This program distributes essential goods baskets to low-income families, supplementing their food budget. Child and education support For families with children, there are also support measures in education, such as the family allowance, which can be increased for minimum wage workers. Additionally, there is the possibility of exemption or reduction of costs in nurseries and public schools, easing the family budget for education and childcare expenses.
Source: Adobe Stock Author: Redaction According to information from the Bank of Portugal released this week, the average interest rate on new mortgage credit contracts and renegotiated contracts decreased in July by 0.03 percentage points and 0.09 percentage points, respectively. Thus, the interest rates for new mortgage credit contracts dropped to 3.56%, while the rates for renegotiated contracts decreased to 4.05%. There was also a decrease of 0.03 percentage points in the average value across other European countries. Portugal had one of the lowest interest rates (7th place) compared to other countries. Read more about: IRS: new tables in effect.
Source: Adobe Stock Author: Redaction The Bank of Portugal released statistics regarding new mortgage loans, recording a 74% increase in new loans contracted with a mixed interest rate in July. This means that more people are opting for a mixed interest rate, where they initially have a fixed-rate period followed by a variable-rate period. Since January of this year, the 6-month Euribor rate has been the rate that more Portuguese are choosing , representing 37.5% of mortgage contracts with a mixed interest rate. Read more about: Do you know how to evaluate loan conditions? We tell you everything.
Source: Adobe Stock Author: Redaction Payments are decreasing, and the market anticipates further declines until the end of 2025 . Portuguese households will only notice the reduction in the month of their contract review. The Euribor, the main benchmark used in mortgage loans, is expected to end the year below 3%, providing financial relief for both families and businesses. The outlook suggests that we are beginning a cycle of interest rate reductions. The next European Central Bank (ECB) meeting, scheduled for September 12 , will be crucial in setting the course for these declines. Banks have already started adjusting to this downward trend. The 12-month Euribor , which was above 4% between June 16 and November 29, 2023, even reaching 4.2%, has started to decline and currently reflects a 1% reduction. The same pattern is observed in the six-month rate, which also exceeded 4% between September 14 and December 1 and has been decreasing. According to the Bank of Portugal, in June, the most common variable rate was the six-month Euribor, representing 37.5% of all real estate loans. The 12-month Euribor followed with a 33.7% share, and the three-month rate accounted for 25.7%. Read more about: Local accommodation: extraordinary contribution revoked.
Source: Adobe Stock Author: Redaction After more than two years of constant increases in mortgage payments, Euribor rates are starting to reverse the trend, providing relief for families with home loans. The 3, 6, and 12-month rates have dropped again, to 3.469%, 3.351%, and 3.072%, respectively. This reduction has a positive impact on home loan interest rates, marking a shift for many Portuguese families, leading to some savings for many who have only seen increases in their mortgage payments until now. In the coming months, Euribor rates are expected to continue to fall, reflecting the anticipated change in the European Central Bank’s (ECB) monetary policy. According to the president, Christine Lagarde, the next meeting on the subject will be held on September 12. Read more about: April: interest rate in Portugal was lower than in the Eurozone , Youth home loans: everything you need to know , Advancement of state guarantees in home loans awaits regulation.
Source: Adobe Stock Author: Redaction The decree-law 42/2024 of July 2 , which extends access to the youth rental program, has been published in the Diário da República. Although young people aged between 18 and 35 can apply, the new changes now foresee that a candidate who turns 36 during the period in which they benefit from the support can also apply, as long as it is done consecutively. The application also extends to couples where one partner may be 37 years old , provided the other is 36, under the conditions mentioned above. Young people can now apply for the program to find out the amount of support they can receive and only then enter into the rental contract. Additionally, young people can also consult properties for rent, directly from property owners, on the website of the Institute for Housing and Urban Rehabilitation (IHRU). These changes came into effect in September, eliminating limits on the maximum rent, which means that a candidate who has found a house to rent for 401 euros may be eligible, as the maximum threshold of the municipality where they reside, 400 euros, will no longer affect eligibility for support. The requirement to present six payslips has also been removed, and a minimum of three payslips will suffice . The Government aims to help more young people with these new changes, estimating that in 2025, there will be an increase in support of 26 million euros. Read more at: Can you assess loan conditions? We tell you everything , Impact of rising interest rates on average mortgage payments , Understand the different types of interest rates: fixed, mixed, or variable.
Fonte: Adobe Stock Autor: Redação The Swap Rate is a fundamental concept in the financial market, especially for those interested in taking out a mortgage. But what exactly is it, and why is it important? Find out more. What is a Swap? In simplified terms, a swap is an agreement between two parties to exchange future payment streams. In the case of a swap rate, this exchange typically involves payments indexed to variable interest rates for payments indexed to fixed interest rates. Swap Rate in Home Loans In the context of home loans, the swap rate is used as a reference to determine the interest rate on a loan. By opting for a loan with a swap rate, the borrower is essentially betting on the movement of interest rates in the market. There are two types: Decreasing Swap Rate : If market interest rates fall, loan payments also tend to decrease because the swap rate used as a reference will be lower. Increasing Swap Rate : Conversely, if market interest rates rise, loan payments are likely to increase as well. Why is the Swap Rate Important? Firstly, it provides flexibility, allowing the borrower to choose between a higher risk of payment fluctuations in exchange for the possibility of benefiting from lower interest rates in the future. It also helps in long-term financial planning, especially for those who intend to keep the loan for an extended period. In some situations, it is possible to acquire financial products that can protect against rising interest rates, such as reverse swaps, which offer greater security. The swap rate is an important tool for those considering taking out a loan. By understanding how it works and its implications, you can make a more informed decision and choose the option that best suits your profile and needs. It is crucial to consult a specialist to analyze the different loan options available and help you choose the one that offers the best conditions and the lowest risk.
Fonte: Adobe Stock Autor: Redação Abreath of hope and opportunity is sweeping across the Portuguesehousing market with the imminent introduction of the State Guaranteefor housing loans. This eagerly anticipated measure promises toradically transform the home buying landscape, serving as a crucialboost for those striving to achieve the dream of owning their ownhome. With the regulations still to be defined, the country stands onthe brink of a financial revolution capable of changing lives andgiving a new dimension to the concept of housing accessibility. Imagine the relief for thousands of families who can finally lookto the future with greater security and confidence. The new guaranteescheme is set to help many Portuguese who have been held hostage byrelentless banking requirements and exorbitant down payments, nowhaving the chance to secure credit for their dream home. The promiseof more accessible financing is a breath of fresh air for those whohave been blocked by financial obstacles, and the sense ofpossibility is palpable throughout the country. However, this dream will only be realized once the details of theregulations are fully clarified. The government is now in a raceagainst time to define the rules to ensure that this guaranteefunctions effectively. While the specifics remain mysterious, thepotential impact is monumental: the hope is that the implementationof the regulations will provide a framework that supports both buyersand banks, and builds a solid bridge towards a more inclusive andsustainable housing future. As we eagerly await the outcome of this initiative, theanticipation is at its peak. The State Guarantee has the power tounlock previously closed doors, enabling new dreams to be realizedand new success stories to be written. If the regulations fulfilltheir promises, we will witness a new dawn in the housing market,where the possibility of homeownership is not a distant privilege buta reality within reach for many. The future of housing in Portugal isawakening to a new and exciting chapter, and the countdown to thistransformative moment has already begun.
Fonte: Adobe Stock Autor: Redação Didyou know that being on the Banco de Portugal’s blacklist canseverely impact your financial future? This list records citizenswith significant payment difficulties and can result in seriouscredit restrictions and obstacles to obtaining essential financing.The feeling of insecurity and fear of unpleasant surprises arecommon, but there is a simple way to alleviate this burden. Discoverhow you can check your status and ensure your name is not on theblacklist, thus protecting your financial future and avoidingunforeseen issues that could complicate your life. To find out if you’re on the blacklist, Banco de Portugal offersan intuitive online service. Through the Customer Banking Portal, youcan check your credit history and confirm if there are any records ofdefault. The process is straightforward: you simply need to providesome personal information and, in some cases, additional documents toconfirm your identity. This system was developed to provide greatertransparency and control, allowing you to identify and resolvepotential issues before they become insurmountable obstacles. Additionally, being proactive about your finances is crucial.Regularly monitoring your financial situation and addressing anypending issues can prevent inclusion on the blacklist and ensuresolid financial health. By staying informed and taking correctiveactions in a timely manner, you avoid unpleasant surprises and alsobuild a stable and reliable financial foundation. Don’t let a smallmistake become a major obstacle—check your status and take controlof your financial future today.
English
Português
Français
Español
Deutsch
Nederlands
Русский
中文(简体)
