Mortgage for foreigners: What documents are required?

Mortgage for foreigners: What documents are required?

Are you a foreigner considering applying for a home loan in Portugal? The process can be simple, as long as you are informed beforehand. Find out what may differ in terms of conditions for locals, and what documents banks may request from you.

11 Aug 20234 min

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Mortgage credit for foreigners: Different conditions?

A home loan for non-resident foreigners has conditions similar to those offered to nationals, but certain aspects differ.

The major differentiating factor is the maximum financing limit. For non-residents, banks only lend up to 80% of the property value, while for a national, the bank can lend up to 90% of the lower value between the acquisition and evaluation of the property.

However, please note that if the client is European and has a Residence Certificate in Portugal (CRUE), or residence in Portugal with income declared in IRS, through banks, they may be able to obtain a proposal equivalent to permanent housing for nationals. Thus, they may only have to provide 10% of the property value.

Another difference that one may come across as a foreigner when applying for a home loan in Portugal is related to the financing term. In Portugal, if you are under 30 years old, you can get a maximum term of 40 years, between 30 and 35 years, a maximum term of 37 years, and over 35 years, a term of up to 35 years. However, these terms may be shorter for foreigners, depending on the bank.

Conditions may also vary depending on whether, as a foreigner, you reside inside or outside of Europe.

In any case, you can always rely on a credit intermediary Poupança no Minuto to help you negotiate the conditions, as well as gather all the necessary documents that we will see next.

What documents do I need to submit to the bank?

In order to continue with a feasibility study of housing credit for foreigners, banks require some documents, many of which are common to those required for nationals.

What differs are the documents that confirm the income received by clients, as well as those that guarantee they have no occurrences of debts and non-compliance in the country where they live. This is because this type of documentation varies depending on the country of origin.

In general, the following documents are required from foreign clients to contract housing credit in Portugal: https://www.poupancanominuto.com/

  • Identification document (passport and Portuguese fiscal identification number - NIF);
  • Proof of income and expenses (latest income statement, last 3 pay slips or other proof of income, company balance sheet and last income statement for self-employed workers, annual pension proof for retirees, monthly bank statements from the last semester, and proof of semi-annual payment for other loans);
  • Country income responsibility center;
  • Tax Return or Tax Notice from the current country of residence.

Regarding the NIF, it is mandatory for foreign clients to obtain it in order to be able to apply for a mortgage in Portugal. This is because this number will identify the citizen before the Portuguese government and respective tax authorities. The NIF application can be made at the Tax Authority presenting proof of residence, passport, or identification document.

In this case, as you may not have residency in Portugal yet, you will need to appoint a tax representative in the country temporarily in order to obtain the NIF and proceed with the purchase of the property.

It should be noted that it may be necessary to translate the documentation for the credit viability study, which can be done at the customer's expense, depending on the bank. However, certain banks do not charge for this service.

As for the process being able to be done digitally, instead of the foreign client having to go to the bank, there are banking institutions that also allow it. Also, if you have a legal representative, it is possible to proceed with the process through power of attorney.

However, it is always advisable for foreign clients to contact banks directly to understand the conditions being proposed to them. This process can also be made easier through the mediation of an agent, such as those from Poupança no Minuto, who handle all the bureaucracy, doubts, and questions. With a free, fast, and assertive service, you can get your home in Portugal in the blink of an eye.

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