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How to get a mortgage in Portugal as a foreigner: Complete guide!

getting a mortgage in portugal

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If you’re interested in owning property in Portugal, you may wonder how to get a mortgage in Portugal as a foreigner. Portugal’s beautiful landscapes, rich history, and welcoming culture have made it a popular destination for expats looking to settle down. While securing a mortgage in a foreign country may seem daunting, with the right information and guidance, you can make your property ownership dreams a reality.

Understanding mortgage in Portugal

The concept of mortgages in Portugal is not much different from other places. The essence of it is to secure a loan to purchase a property and gradually pay it off with an interest rate over a specific period of time. But hold on – this country has some cool perks that make getting a mortgage in Portugal as a foreigner even more interesting.

Advantages of getting a mortgage in Portugal as a foreigner

Regarding getting a mortgage in Portugal as a foreigner, several advantages might catch your interest. Let’s look at these perks that could make your property dreams even more achievable.

1. Favorable interest rates

One advantage of getting a mortgage in Portugal as a foreigner is the availability of lower interest rates compared to some European nations. This can result in less interest paid over the life of the mortgage, allowing more investment opportunities without high interest costs.

2. Attractive incentives

The Portuguese government is offering incentives to attract foreign investors. These incentives can lead to better mortgage conditions, such as reduced down payments, lower interest rates, and other financial benefits. This means that owning property in a desirable location is not only easier but also more financially flexible.

3. Potential for long-term savings

With the combination of lower interest rates and potential government incentives, securing a mortgage in Portugal as a foreigner could lead to substantial long-term savings. By paying less in interest and potentially benefiting from financial perks, you can allocate your resources toward other priorities, whether it’s enhancing your property, exploring the country, or simply securing your financial future.

4. Investment opportunity

Portugal’s real estate market has been gaining attention, and rightfully so. This offers both the chance for personal enjoyment and the potential for investment returns. By taking advantage of the favorable mortgage terms and government initiatives, you could be positioning yourself to make a wise financial move that could pay off in more ways than one.

5. Diverse property options

Portugal offers various property options, from historic city centers to serene countryside and breathtaking coastal areas. With favorable mortgage conditions, you’ll have more opportunities to explore and choose the property that perfectly aligns with your vision and lifestyle.

mortgage rates in portugal

Requirements for getting a mortgage in Portugal as a foreigner

Foreigners looking to secure a mortgage in Portugal must meet certain requirements to navigate the application process smoothly. Here’s what you need:

1. Valid passport

A valid passport is a crucial document that establishes your identity and nationality. It’s one of the primary forms of identification that lenders will ask for when you’re applying for a mortgage in Portugal as a foreigner.

2. Portuguese taxpayer number (NIF)

To engage in any financial transactions in Portugal, including obtaining a mortgage, you’ll need a Portuguese taxpayer number, commonly known as NIF (Número de Identificação Fiscal). This unique number is essential for tax purposes and helps the Portuguese authorities track your financial activities.

3. Proof of income

Demonstrating your ability to repay the mortgage is a fundamental requirement. You’ll need to provide evidence of your income from various sources. This can include:

  • Employment: You must show your employment contract and recent pay stubs if you’re employed. Lenders want to ensure you have a stable income to meet your mortgage payments.
  • Retirement: If you’re retired and receive a pension, you must provide documents verifying your pension income. This could include pension statements or government-issued documents.
  • Investments: If you have investments that generate income, such as rental properties or dividends, you’ll need to provide documentation that shows the income you receive from these investments.

Remember, while these are general requirements, specific lenders might have additional criteria or variations in their application process. Therefore, it’s always a good idea to consult with a financial advisor or mortgage expert who can guide you through the specifics and help you prepare a strong mortgage application package.

Choosing the right mortgage option

When obtaining a mortgage in Portugal as a foreigner, it is crucial to explore the various options available to make an informed decision. Let’s take a closer look at two common types of mortgages in Portugal:

1. Fixed-rate mortgages

This type of mortgage offers a fixed interest rate throughout the loan’s duration, providing stability and predictability in monthly payments. This can be advantageous for budget-conscious individuals, who will always know how much to allocate for their mortgage payments.


  • Predictable payments: Your monthly mortgage payments won’t change, providing financial certainty.
  • Long-term planning: Fixed-rate mortgages are ideal if you prefer to plan your finances over the long term without worrying about interest rate fluctuations.
  • Peace of mind: You won’t be affected by sudden interest rate increases in the market.


  • Potentially higher initial rates: Fixed-rate mortgages might have slightly higher initial interest rates than variable-rate options.
  • Less flexibility: You won’t benefit from decreased interest rates if market rates decrease during your mortgage term.

2. Variable-rate mortgages

Variable-rate mortgages, also known as adjustable-rate mortgages, come with an interest rate that can change based on market fluctuations. Initially, the interest rate is lower than that of fixed-rate mortgages resulting in lower monthly payments.


  • Lower initial payments: Variable-rate mortgages can have lower initial interest rates, making them advantageous for minimizing early monthly expenses.
  • Potential for lower costs: If interest rates decrease, your payments could also decrease, potentially saving you money over time.
  • Shorter lock-in periods: Variable-rate mortgages usually have shorter lock-in periods, offering flexibility in refinancing or selling your property.


  • Interest rate uncertainty: Your interest rate can increase over time, leading to higher monthly payments.
  • Budget variability: Fluctuating interest rates can make predicting and budgeting for future payments challenging.

Finding the perfect property

Before applying for a mortgage in Portugal as a foreigner, you must clearly know the property type you want to purchase in Portugal. Understanding your preferences will guide your property search, whether it’s an urban apartment, a countryside villa, or a coastal retreat.

Applying for a mortgage in Portugal as a foreigner

The mortgage application process involves submitting your documentation to a bank or lender. They will review your financial information, credit history, and property details to determine your eligibility. Having a knowledgeable real estate agent can be incredibly helpful during this stage.

Documentary requirements

As you embark on the mortgage application process, gather essential documents that comprehensively view your financial situation. Be prepared to present:

  • Proof of Income: This could include pay stubs, tax returns, and employment contracts. Lenders need to assess your ability to make mortgage payments.
  • Bank Statements: Recent bank statements demonstrate your financial stability and showcase your ability to manage mortgage payments.
  • Property Information: Details about the property, such as its location, type, and estimated value, contribute to the lender’s evaluation.

Property valuation and survey

 A property valuation and survey are often required to protect both you and the lender. This step involves professionals assessing the property’s value to ensure it aligns with the loan amount. A thorough evaluation safeguards against overestimating or underestimating the property’s worth, promoting fairness and transparency.

Approval and terms

You’ll receive a mortgage offer outlining the terms and conditions if your application is approved. This document is crucial, as it details aspects like the interest rate, repayment schedule, and any additional fees. Before accepting the offer, take the time to review these terms carefully. If needed, seek legal advice to ensure you fully comprehend the agreement you’re entering into.

Closing the deal

Once you’ve accepted the mortgage offer, it’s time to seal the deal. This involves working with a notary to ensure all legal requirements are met during the property purchase. The notary verifies the transaction’s legitimacy and registers the property in your name, officially solidifying your ownership.

Tax implications and financial considerations

Owning property in Portugal comes with financial responsibilities, including property transfer tax and annual property taxes. Understanding these tax implications and incorporating them into your budget planning is crucial. Being well-informed allows you to manage your finances effectively and avoid any surprises.

Insurance protection for your investment

Protecting your investment and loved ones is paramount. Consider obtaining property and life insurance to provide a safety net if unexpected events, such as accidents or unforeseen circumstances, arise. These insurance policies offer peace of mind, ensuring that your hard-earned investment remains secure.


Navigating the process of getting a mortgage in Portugal as a foreigner might seem complex, but it’s entirely feasible with the right guidance. By understanding the requirements, choosing the right mortgage, and working with experienced professionals, you can make your dream of owning property in Portugal a reality. So, take the first step today and embark on this exciting journey to property ownership.

Get help with securing a mortgage in Portugal as a foreigner

Securing a mortgage in a foreign country can feel like a complex maze, especially if you’re not familiar with the local regulations and procedures. If you’re a foreigner with dreams of property ownership in Portugal, rest assured that you don’t have to navigate this journey alone. We’re here to offer you expert guidance and support every step of the way. Our team of experienced professionals specializes in assisting foreigners in obtaining mortgages in Portugal. We understand the intricacies of the process, the necessary documentation, and the best strategies to ensure a smooth and successful application. 

Get help with securing a mortgage in Portugal as a foreigner

Leave your name and email below – Our property expert will reach out to explain more on this topic and answer all your questions.

Frequently Asked Questions (FAQs):

Can I get a mortgage as a non-resident in Portugal?

Portugal welcomes non-residents to apply for mortgages. The country’s real estate market is open to international buyers, and many lenders offer mortgage options to foreigners. So whether you’re considering a charming Lisbon apartment or a picturesque villa in the Algarve, you can explore mortgage opportunities to make your property dreams a reality.

Are there any restrictions on the type of property I can buy with a mortgage?

There are no major restrictions on the type of property you can purchase using a mortgage in Portugal. Both residential and commercial properties are accessible through mortgages. This means that whether you’re looking for a cozy home or a business space, a mortgage could potentially assist you in acquiring your desired property.

Is choosing a fixed or variable interest rate better?

The decision between a fixed and variable interest rate depends on your financial circumstances and risk tolerance. Opting for a fixed interest rate provides stability in your monthly payments over the long term, shielding you from potential interest rate fluctuations. On the other hand, a variable interest rate might offer lower initial payments, but it comes with the possibility of rate changes. 

What is the typical mortgage term in Portugal?

In Portugal, mortgage terms typically span a flexible range from 5 to 40 years. This wide spectrum enables you to tailor your mortgage to your specific needs and preferences. Shorter terms can lead to faster ownership, while longer terms may result in lower monthly payments. Evaluating your financial situation and future plans will help you determine your ideal mortgage term.

Are there prepayment penalties if I pay off my mortgage early?

While many mortgages allow for early repayment, some might have prepayment penalties. These penalties can vary and are often linked to the type of mortgage and the terms you’ve agreed upon. It’s crucial to thoroughly review your mortgage agreement and discuss any potential penalties with your lender. Being well-informed will help you make sound financial decisions regarding your mortgage repayment strategy.

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Get help with securing a mortgage in Portugal as a foreigner

Free e-book
Your Comprehensive Guide to Buying Property in Portugal

Get help with securing a mortgage in Portugal as a foreigner

Leave your name and email below – Our property expert will reach out to explain more on this topic and answer all your questions.