Buying a House in Portugal with a Mortgage? Our Unfiltered Guide
- itllbefunretiremen
- Jul 9
- 6 min read
Bom dia, it's Alan and Leslie from It'll Be Fun!
If you're watching our channel, you're probably dreaming of a new life in Portugal. We get it! We did it, and we've never looked back. But we also get one question more than any other: "Can we buy a house in Portugal with a mortgage, especially if we're in our 50s or 60s?"
The short answer is yes, but the process can feel like navigating a minefield. You find the perfect place, start the mortgage paperwork, and then BAM—a cash buyer swoops in and the house is gone. The seller won't sign a contract that gives you time to get financing, and you're left heartbroken, blaming the real estate agent. We've seen it happen, and it’s beyond frustrating.
So, let's pull back the curtain and give you the real, unfiltered guide to buying property here with a mortgage. We want to help you make good decisions and understand this uniquely Portuguese issue, so you can turn that dream into your actual address.
The Hard Truth: Portugal's Red-Hot Property Market
First, you have to understand the battlefield. Portugal’s property market isn't just growing; it's exploding. As of early 2025, national house prices shot up by a staggering 15.8% year-on-year, with the first quarter alone seeing a 6.6% jump—the highest quarterly increase since 2007. This isn't just a little boom; it's a high-pressure seller's market, fueled by a massive influx of foreign investment, which accounted for a stunning 81% of the total real estate investment value last year.
This creates intense competition, especially for properties in the €500,000 range. This price point is a magnet for international buyers and wealthy locals as well, many of whom are ready to pay cash. Because there's way more demand than supply, sellers have all the power. They want speed and, most importantly, certainty. A cash offer is a sure thing that can close in a couple of weeks. An offer that depends on a bank loan that could take months? To them, that just looks like a risk.
The Mortgage Maze: What You Need to Know - Buying In Portugal
Getting a mortgage as a foreigner, especially if you're over 50, has its own set of rules. It’s not impossible, but you need to be prepared.
The Down Payment: Forget the 10% or 20% you might be used to. As a non-resident, Portuguese banks will typically only lend you 60-70% of the property's value. This means you need to be ready with a 30-40% down payment in cash.
The Age Limit: This is a big one for our community. Most Portuguese banks have a strict rule that the mortgage must be fully paid off by the time you turn 75 years old. So, if you're 60, the longest loan term you can get is 15 years. A shorter term means higher monthly payments, which can make it harder to qualify.
The Paperwork Mountain: The banks will want to see everything. Be ready with payslips, tax returns for the last few years, bank statements, and a credit report from your home country. If you're retired, you'll need official proof of your pension income.1
Spotlight on Location: Northern Portugal & Madeira Island
While Lisbon and the Algarve get a lot of attention, there are amazing opportunities in other parts of the country.
Northern Portugal: This region is gaining traction with investors for its competitive prices and authentic charm. Porto, the region's vibrant capital, has average property prices around €3,937 per square meter. But if you look at beautiful coastal towns like Vila do Conde, prices can be much more accessible, around €2,832 per square meter. The rental yields here are also very attractive, making it a smart investment.
Madeira Island: Our beloved home! Madeira is a hotspot, and for good reason. The property market is booming, with prices in the capital, Funchal, averaging around €3,693 per square meter. But you can find more affordable spots in charming towns like Santana or Canico. The island offers an incredible quality of life, a huge expat community, and a year-round tourist season, which is great for rental income.
The Big, Scary Contract (CPCV) and the Dreaded "No Contingency" Rule
This is where most people get into trouble. In Portugal, the key legal document is the Contrato de Promessa de Compra e Venda (CPCV). This is a binding promissory contract, and when you sign it, you typically pay a deposit of 10% to 30% directly to the seller—not into a neutral escrow account.
Here’s the kicker: if you back out for any reason (like your mortgage falling through), you lose that entire deposit. If the seller backs out, they have to pay you back double.
This is why sellers hate a "financing contingency"—a clause that lets you get your deposit back if you can't secure a loan. In this hot market, a seller won't take their property off the market for weeks while you try to get a loan. They have cash buyers lining up who can close in days. So, they refuse the contingency, putting all the risk on you.
How to Compete (and Win!) Without a Suitcase Full of Cash
So how do you do it? How do you compete with cash buyers when you need a mortgage? You have to be smarter, more prepared, and build a team you can trust. This is exactly how we did it, and it's the core of what we teach.
1. Assemble Your Dream Team
You absolutely cannot do this alone. The Portuguese system is built on relationships, and having the right people in your corner is everything.
Your Buyer's Agent: The single most important person on your team. Unlike in the US, Portugal doesn't have a central MLS system, and agents often represent both the buyer and seller—a huge conflict of interest. You need an agent who works
exclusively for you. We found our perfect partner in Claudia Ribeiro and her team at LCL Real Homes. They are absolute rockstars who understand the market inside and out and fight for your best interests. You can reach them at www.lclrealhomes.com. They are the core of our relocation team and we recommend them to everyone.
Your Mortgage Broker: Don't go directly to the banks! A good broker is worth their weight in gold. The team at LCL Real Homes works directly with an amazing mortgage broker, Madeira Credit, who are experts at getting loans for expats. They have even been able to get mortgages for non-residents with as little as a 20% down payment, which is almost unheard of.
Your Lawyer, Tax Advisor, and More: You'll need other experts to handle the legal and financial side. We've spent years vetting the best of the best. You can find our personal, trusted list of vendors for everything from lawyers to immigration attorneys on our website.
2. Become "Cash-Like"
Your goal is to make your mortgage-backed offer look as safe and certain as a cash offer.
Get Pre-Approved: Before you even look at a single property, work with your mortgage broker to have all your documents on hand and to get an estimate of what you can qualify for.
Have Your Deposit Ready: Make sure your 20-30% down payment and funds for closing costs (another 8-10%) are liquid and ready to be transferred. We work with SpartanFX to move our money safely.
Be Organized: Have your entire financial dossier scanned and ready to go. When your team asks for a document, send it the same day. Speed and professionalism build confidence.
It's a Challenge, But It'll Be Fun!
Look, buying a home in Portugal with a mortgage is a high-stakes game. But with the right strategy and the right team, you can absolutely win. It requires preparation and a shift in mindset, but the reward—a new life in this incredible country—is worth every bit of the effort.
We share tons of stories and tips about this on our YouTube channel, "It'll Be Fun - Retire & Roam".1 For checklists, our trusted vendor list, and more, head over to our website at
And if you want someone to hold your hand through the entire process—from visas to finding a home—check out our Ultimate Moving Abroad Program. We built it to help you avoid the mistakes we see people make every day.
You can do this. We're here to help. It'll be fun... we promise!
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