2011 Property Market Predictions
Obtaining a mortgage in Portugal in Euros will probably give you the best interest rate for your mortgage, however it is often easier to raise the money in the UK (or your home country) and then purchase the Portuguese property outright. 2010 was the last year where the number of residential loans was higher, according to data released by the central bank led by Carlos Costa on Tuesday. Said Diário de Notícias early this morning, the Finance ministry has refused to comment on negotiations underway with the Association of Portuguese Banks and the Bank of Portugal".
Persons who are not residents of Portugal need to pay taxes only on income earned at that country, for instance, interest paid on deposits or savings in Portuguese banks. A couple of banks in France say they'll do mortgages for nonresidents, but the requirements are so strict that precious few non-France residents would qualify.
The early redemption penalty during the fixed rate period is 2% as per the regulation of the Bank of Portugal. So if you are purchasing your dream four bedroom villa in sunny Algarve for €450.000, add approximately 8% to the purchase price to cover all costs including taxes, stamp duties, registrations and legal fees.
Another large international bank is Barclays, they are based in the UK but if you want to get a mortgage to buy a holiday home in France, an investment property in Italy, a retirement home in Spain or even a golf retreat in Portugal they are one of the best lenders to speak to. If you aren't based in the UK or even France, Spain, Portugal or Italy it doesn't matter as the majority of your research and application process can be done online with most international mortgage lenders, there is then just a requirement to prove earnings, status and identity which can often be done with the certification of various documentation.
Most banks will not offer a mortgage to individuals 70 years or more, but some will extend this limit to 80 years. It's possible to get a mortgage in Portugal as a retiree in your own name providing you receive a regular pension income. On condition that all apposite certifications are presented, any tax on inheritance (referred to as Stamp Tax in Portugal) need not be paid when a property is bequeathed to a close family member.
The Portuguese government does encourage foreign investment in property, so there aren't any restrictions on non-EU residents looking to purchase property in Portugal. Interest rates are higher for this type of mortgage, normally between 2% and 2.5% above euribor with a maximum loan to value of 75%.
Barclays, for instance, lends for Portuguese properties as well as to purchasers of property in France, Spain and Italy. With so many developers offering new and off-plan property, single houses sell far less quickly and those interested in second hand homes are usually bargain hunting at the lower end of the market.
When it comes to mortgage rates, Portugal bases them on the Euro Interbank Offered Rate (Euribor), plus a margin typically between 1.50% and 2.50%. Valuation report - once you have received a formal mortgage offer the bank will carry out a valuation of the property.
Na sua qualidade de intermediário de crédito vinculado, ComparaJá mantém contrato de vinculação sem regime de exclusividade com as seguintes entidades: Banco Santander Totta, S.A., Banco BIC Português S.A., Banco Comercial Português S.A., Bankinter, S.A. - Sucursal em Portugal, Banco CTT, S.A., Caixa Geral de Depósitos S.A., Banco BPI S.A., Novo Banco S.A., Union de Créditos Inmobiliários, S.A., Establecimiento Financiero de Crédito (Sociedad Unipersonal) - Sucursal em Portugal, Abanca Corporación Bancária, S.A, Sucursal em Portugal, BNI - Banco de Negócios Internacional (Europa), S.A., Cofidis, Montepio Crédito - Instituição Financeira de Crédito S.A., Unicre - Instituição Financeira de Crédito, S.A., Bankinter Consumer Finance, EFC, S.A.
Additionally set up fees for a Portuguese mortgage are considerably lower than in the UK as are property valuation costs; mortgage redemption fees are fixed by the government at only 0.5%. But as the stories here reiterate, the exact terms of this mortgage amnesty in Portugal have not yet been fully explained.
Quinta Finance mortgage advisors are UK qualified and through their well established relationships with all the major Portuguese lenders Algarve Property Facebook they are able to assist you in sourcing the best available mortgage offer and help you navigate your way through the mortgage process.
You might also find the interest rate you'll be paying is higher than what you would pay if you borrowed in Portugal, where interest rates are very competitive. Virtually all mortgages are principal plus interest loans, though banks offer both fixed and variable rate mortgages.
