The crisis has knocked on the door of many families, who have seen their mortgage payments soar - those whose loans are indexed to variable Euribor rates - since the middle of last year. In order to mitigate this scenario, the government has given the green light to the possibility of fixing house payments for two years. Adhering to this measure does, however, mean paying more interest at the end of the loan. So is it worth fixing your mortgage payments?
On November 2, 2023, a measure came into force that allows Portuguese home loan holders with a variable rate to fix the installment of their home loan for two years. This is the government's response to the rapid rise in the reference indexes used to calculate interest on variable-rate mortgages, in order to ensure greater predictability for families when managing their budgets.
Although you haven't mentioned it, we're assuming that your loan has a variable rate, so you can request a review of the installment by setting its value, which results from calculating 70% of the value of the reference interest rate, in this case the six-month Euribor, plus the value of the contracted spread.
How do I request a fixed mortgage payment?
You have until March 31, 2024 to submit a request to fix the installment to your bank or through its digital channels.
Following your request, banks have 15 days to respond, including simulations of the installment due and the installment with part of the amount deferred, the amount to be paid later and the repayment plan for the amount to be deferred. After this information, you will have 30 days to inform the bank whether or not you want the installment to be fixed.
Please note: the difference will always be paid by you or your family. This amount will be added to the outstanding capital and will be paid from the fourth year after the fixation ends.
Source: idealista/news