Guide to 100% financing for youth.

The solution to the lack of entry: the Public Guarantee

For years, the rule of a maximum financing of 90% kept thousands of young people away from buying a home, simply because they couldn't save the thousands of euros needed for the down payment. In response to this barrier, the Portuguese State created the Public Guarantee, a measure in force until the end of 2026 that acts as a 'guarantor' for the buyer.

With this solution, the State guarantees up to 15% of the property transaction value, allowing banks to finance the full (100%) acquisition value. This way, young people can access the real estate market by only paying the monthly installment, without having to spend years trying to save the usual 10% down payment.

Who is entitled to 100% financing?

Despite being a green light for the first house, 100% credit has tight rules. To benefit from this guarantee, it is mandatory to comply with the following conditions cumulatively:

• Age: To be between 18 and 35 years old (inclusive) and fiscal residence in Portugal.

• Income: Do not exceed the limit of the 8th bracket of the IRS, which in 2025/2026 corresponds to an annual taxable income of about €83,696.

• Heritage: Not being the owner (nor co-owner) of any other residential property.

• Purpose: The credit is intended exclusively for the purchase of the first Permanent and Own Housing (HPP).

• House value: The acquisition price (or appraisal value, whichever is lower) cannot exceed 450,000 euros.

• Fisco: Have the situation regularized (without debts) in Finance and Social Security.

If you are a couple buying, both individuals must meet all of these requirements.

Does the exemption of IMT and Stamp Duty accumulate with the guarantee?

Yes. One of the great advantages of this scheme is that Public Guarantee accumulates with tax exemption (IMT and Stamp Duty) for young people up to 35 years old.

This means that if you buy a house up to 316,772 euros (updated value of the 4th IMT bracket), you won't have to pay any taxes to the State, and the bank lends 100% of the value. This double advantage reduces the savings needed to buy a home practically to zero.

On the other hand: the installment will be higher.

Buying a house with 100% financing is not without risks. By financing the entire property, the amount owed to the bank will be higher than with a 90% loan. As a result, your monthly installment will be higher.

This requires young people to have a solid income. The Bank of Portugal recently imposed that the effort rate cannot exceed 45%. Therefore, it is not enough for the State to provide the guarantee: the bank will rigorously analyze your income to confirm if you have the ability to pay a heavier monthly installment without entering default risk.

The costs that the bank does not forgive.

Even with 100% financing and IMT exemption, you will still need some money in your pocket before signing the deed. You will have to pay:

• Initial banking commissions (study, file and property assessment commission) range from €500 to €1,000. Some banks, however, exempt young people from these commissions.

• Writing and notary expenses.

• The cost of hiring mandatory insurance (Life and Multirisk).

An expiration date not to forget.

The State Public Guarantee lasts for 10 years. In addition, the law establishes that this measure will only be valid for contracts formalized until December 31, 2026.

100% financing eliminates the entry barrier, but requires a higher monthly capacity to pay the installment to the bank. Analyzing your net income and planning procedural costs is vital before starting to visit houses.

Do you want to know if you qualify for 100% financing?

Do a simulation in Poupança no Minuto. Our experts analyze your income, confirm if you meet all State requirements, and tell you exactly how much you can buy your first house without a down payment.