100 Mortgages
In this tough financial climate we continue to find ourselves, many are left with their assets floundering in the wind, so to speak! Resale properties have traditionally incurred a transfer tax based on the property value and purpose of the property, with rates potentially reaching 8% of the property's value in certain cases. In the current market environment it has become more difficult to release funds from your existing property and rates are higher than for a standard acquisition mortgage.
In addition to Italy, new mortgage loans on the periphery of the eurozone will record double-digit increases. Never forget these Portuguese Banks lending to the Portuguese sovereign nation when buying their own Government debt. Tracker rate mortgages are linked to the Bank of England base rate.
The table above shows essential details of selected mortgage products offered to retail customers by the banks in Portugal: currency, borrowing rate per annum, lending amount and mortgage term. There have been times when banks have been careless and greedy in using the money of their depositors.
As a result, property prices are still low compared to other areas of Portugal. All signs point to the current scenario continuing as is. In the latest survey of banks acting on the credit market, financial institutions predicted a slight increase in household demand for credit in the current quarter.
You have a number of options when buying real estate internationally - you can apply for an international mortgage from an offshore bank, you can approach a lender in the country in which you want to buy, you can re-mortgage existing property if you have accrued equity on your home and use the released capital to buy overseas, or you could even approach your local bank and see if they offer mortgages to buy abroad.
The banks are currently lending between 60-80% of the valuation price. Banks may charge a non-refundable commitment fee of up to €600 for loan amounts up to €750,000, with higher fees above this level. Plus advice on currency exchange, lawyers, mortgages and the most professional companies that can help you buy your dream property.
Despite much economic uncertainty in recent years, not to mention an unstable housing market, all the major Portuguese lenders continue to provide mortgages to suitable individuals, including overseas nationals, purchasing property in Portugal. The amount of housing loans that were granted this year is the highest since the beginning of the financial crisis.
You will need to provide a deposit of at least 50% of the property purchase price in order to secure a commercial mortgage in Portugal. CEOs also raised concerns that during these hard times of the pandemic, banks will record heavy losses, and the president of Santander Totta approximated that this loss may range 2 billion up to billion in euros.
Financial institutions have several duties to inform, including, on one hand, to publicize and advertise on their websites and through the regular contacts with clients, the measures provided for in this Decree-Law (including the terms and Algarve Property Trends deadlines to adhere to the moratorium), and on the other hand, to provide full knowledge of all measures provided for in this Decree-Law prior to the formalisation of any credit agreement whenever the client is a beneficiary entity.
Portugal is in the Eurozone where at the time of writing (April 2016) rates are a little higher than in the UK. However, much like the UK mortgage market there is a wide range of mortgage products available so an accurate rate will depend on your circumstances though you should reckon with interest rates of 3.5-5.25%.
It is the interest rate that banks in the Euro Zone use to lend to each other, and is derived from the base rate set by the ECB. This started in the US with the selling of 'sub-prime mortgages' to less well-off buyers, who were tempted by rising house prices and attractive interest rates (sub-prime means more risky).
