Mortgage Costs

We achieve exclusive mortgage products with Portuguese and foreign banks.

Important to know about mortgage and property costs in Portugal

The costs of purchasing property in Portugal with a mortgage can vary considerably depending on the price of the property, the region in which the property is located, the advisers appointed (lawyers, brokers, agents, etc.) and the deal agreed with the vendor or estate agent. Having said that, estimating costs of 7-12% of the purchase price is currently a good guide. In our case study, the total costs are exactly 11% of the declared price.


Most banks charge opening fees and lawyers and brokers also have minimum fees. Notary, registry and tax office fees will not be significantly lower for cheaper properties. This means that for cheaper properties, the costs as a percentage of the property price can be significantly higher than 10%. For properties with a price less than € 40,000, a mortgage may not be the most cost-effective solution.


Always check whether the selling agent has included their commission in the purchase price. Some agents do this and do not charge the purchaser directly. Others do not, so you need to check this out before assessing the overall costs involved.

Affordability Calculator

For self-employed applicants, please give your net profit,after tax figure (divided by 12) for the last tax year. if you are a Director of a Limited company, please write your net basic monthly income here and in additional income below, give your last net dividend payment made in the last tax year.
Please select all the options applicable for you
Please select all the options applicable for you
Please select all the options applicable for you
Maximum term is to age 75 or to age 67 if a suitable pension isn’t in place, even if you intend on working past age 67.

Mortgage payment calculator

Calculate your monthly repayment based on your loan amount and the desired term of the Spanish mortgage.

PROPERTY AND MORTGAGE COSTS

Important to know about mortgage and property costs in Portugal

The costs of purchasing property in Portugal with a mortgage can vary considerably depending on the price of the property, the region in which the property is located, the advisers appointed (lawyers, brokers, agents, etc.) and the deal agreed with the vendor or estate agent. Having said that, estimating costs of 7-12% of the purchase price is currently a good guide. In our case study, the total costs are exactly 11% of the declared price.


Most banks charge opening fees and lawyers and brokers also have minimum fees. Notary, registry and tax office fees will not be significantly lower for cheaper properties. This means that for cheaper properties, the costs as a percentage of the property price can be significantly higher than 10%. For properties with a price less than € 40,000, a mortgage may not be the most cost-effective solution.


Always check whether the selling agent has included their commission in the purchase price. Some agents do this and do not charge the purchaser directly. Others do not, so you need to check this out before assessing the overall costs involved.

AFFORDABILITY CALCULATOR

Affordability Calculator

For self-employed applicants, please give your net profit,after tax figure (divided by 12) for the last tax year. if you are a Director of a Limited company, please write your net basic monthly income here and in additional income below, give your last net dividend payment made in the last tax year.
Please select all the options applicable for you
Please select all the options applicable for you
Please select all the options applicable for you
Maximum term is to age 75 or to age 67 if a suitable pension isn’t in place, even if you intend on working past age 67.
MORTGAGE PAYMENT CALCULATOR

Mortgage payment calculator

Calculate your monthly repayment based on your loan amount and the desired term of the Spanish mortgage.

CASE STUDY

The case study gives an indication of typical costs related to the property purchase and the mortgage.

Costs for €300,000 property - €180,000 mortgage

All costs are estimates. Click on each cost for a more details.

PROPERTY COSTS

PROPERTY TAX: €24,000 (8%)

NOTARY, REGISTRY, AND TAX OFFICE FEES FOR PROPERTY DEEDS: €1,200

LAWYER FEES: €1,800

SUB-TOTAL: €27,000

MORTGAGE COSTS

STAMP DUTY : €1440 (0,8%)

NOTARY, REGISTRY, TAX OFFICE FEES FOR MORTGAGE DEEDS: €1200

BANK OPENING FEE: €900

VALUATION FEE: €280

MORTGAGE DIRECT FEES: €1,495

SUB-TOTAL: €5,315

TOTAL: €32,315

OTHER COSTS

ESTATE AGENT FEES: ?

The price of the property and the type of property determine the property tax and the tax is different when buying a second-hand property compared with a new-build. For second-hand properties, the tax is referred to as IMT whereas for new-builds it is called IVA. These taxes are usually somewhere between 1% and 8% of the property price. We can advise on this when you find your property.

These fees can vary depending on the bank used for the mortgage, the notary and registry offices used and the registry with the tax office. The notary will have to prepare two sets of deeds, one for the property and one for the mortgage and there is a separate set of fees associated with each.

Lawyers charge different amounts. Many charge 1% of the property price plus IVA but may negotiate for higher priced properties. When appointing a lawyer, some clients choose to work with an asesoría, or with a lawyer from their own country or one that speaks their language, without realising that not all legal representatives are not qualified to practice law and therefore the client is not sufficiently protected in the event of any legal problems. A lawyer recognised by the national body of lawyers (La Ordem dos Advogados) will charge more than an asesoría with limited legal power and lawyers have guidelines on what they should charge, although this does not mean that they all charge the same. The most important thing is to appoint a competent lawyer.

The Portuguese government charges a tax (stamp duty) on all legal documents signed, including mortgage and property deeds. For all legal contracts, the stamp duty can vary between 0,4% up until 0,8%. For mortgage contracts, the stamp duty is usually 0,8%. Our advisors can inform you accordingly when having identified how much you would like to borrow.

The bank opening/arrangement fee is a fixed percentage that the bank charges at completion. The typical amount is 0,5%, although some banks charge 1% or more depending on the circumstances.

The valuation fee is charged by the independent valuation company that the bank appoints. The valuation company is usually selected at random by the bank and the amount charged will depend on the company appointed and the property price. The valuer will invoice for their work after and the fee will have to be paid prior to their report being prepared.

We charge an initial fee of €495 if clients wish to proceed with a formal application. Prior to this, our advice is free of charge with no obligation to proceed. Our standard arrangement fee of 0.5% of the mortgage amount (minimum €1,000) is payable upon initial approval of the mortgage prior to valuation. For larger mortgage amounts, depending on the amount of work involved, this fee may be negotiable. If a mortgage is declined or the amount offered is lower than in our initial quotes, we guarantee to refund the fee if clients choose not to proceed. Please refer to our Terms and Conditions.

These fees can vary depending on the bank used for the mortgage, the notary and registry offices used and whether the bank uses an independent asesoría to administer the completion duties. The notary will have to prepare two deeds, one for the property and one for the mortgage and there is a separate set of fees associated with each.

Some agents charge a fee to both the buyer and the vendor. In the cost breakdown, we have not included any fee the agent might charge the buyer. You should check with the agent whether they charge a fee to the buyer.