Mortgage Loans – Everything you need to know before applying for your loan
Buying a home is a major decision. Here is a clear explanation of everything you should know before applying for a mortgage.
The essentials of Mortgage Loans
A mortgage loan is a long-term credit granted by a bank to purchase, build or renovate a property.
The loan amount, rate and term vary according to your financial profile and the type of property.
Purchase of a primary residence — for your main home.
Purchase of a second home — for holidays or investment.
Renovation or construction loan — financing for building works or refurbishment.
Loan transfer — moving your current mortgage to obtain better terms.
How the process works
Five simple steps, from the request to the deed:
- Initial simulation — estimates the monthly instalment and total cost.
- Financial assessment — the bank reviews your income and documentation.
- Property valuation — carried out by an independent appraiser.
- Final offer — you receive the approved loan terms.
- Deed signing — the contract is formalised and the purchase is completed.
Personal Documents
Citizen Card / Passport
Tax Identification Number (NIF)
Proof of address
Financial documents
Latest IRS return and settlement notice
Three payslips
Employment contract statement
Property documents
Updated property tax registration (Caderneta Predial)
Permanent land registry certificate
Usage licence
Key assessment factors before approving the loan.
To ensure the loan is sustainable, institutions assess:
Monthly income and employment stability
Debt-to-income ratio — ideally up to 35–40% of net income
Credit history — including any past defaults
Property value and location
Proof of down payment (minimum 10%)
FAQs
Geralmente entre 3 a 6 semanas, dependendo da rapidez na entrega de documentos e da avaliação.
Nem sempre. Depende do perfil financeiro e do tipo de imóvel.
Sim. Muitas vezes permite reduzir a prestação e o custo total do empréstimo (MTIC).
Raramente. Normalmente financia-se até 90 % do valor (ou da avaliação) para habitação própria.