Vale do Lobo Villas Quinta do Lago Villa Vilamoura

Before you start hunting for your perfect Quinta do Lago or Vale do Lobo property, make sure any estate agent who assists you is licensed by the Portuguese government. In Portugal a real estate license is granted by the State to an estate agent, only if he has all of the required qualifications to operate. The license is a guarantee that the estate agent is qualified in his profession and is also a sort of insurance cover that can be claimed against in the case of proven dispute.

Once you’ve found a licensed estate agent and they have helped you find your dream Algarve villa or apartment and successfully negotiated the purchase, you will have to retain the services of a local lawyer who, after the necessary searches, will draw up a Contrato de Promessa de Compra e Venda – a promissory contract.

This is a legally binding document stating the conditions of the property sale and which also requires a deposit with your lawyer of between 10% and 20% of the total purchase price.

If you drop out of the sale for some reason you will forfeit this money. If the vendor decides to withdraw from the sale they are legally obliged to repay you twice your deposit!

Every purchaser is required to obtain a Fiscal Number from the local Tax Office. Your lawyer will assist you in this.

The promissory contract will also stipulate a date for the signing of the final deed, called the Escritura de Compra e Venda. This is usually three or four weeks after the signing of the contract of sale and is also the date when the balance of the purchase price is requested.

Prior to the final act of purchase, the purchase will be subject to a Municipal payment, like a stamp duty, called IMT or Imposto Municipal sobre Transmissoes which as of the 1st of January 2003 replaces the previous tax payment named “SISA”.

As soon as you sign the final contract your lawyer will register the property with the Land Registry in your name.

Taxes & other costs - You should allow in the region of 10% of the purchase price for taxes, lawyer and notary costs.

Corporate ownership
Much has been said and written about corporate ownership – where the property is owned by a company registered outside of Portugal or as a Portuguese company.

Without going in to too much detail on the subject, there are advantages and disadvantages to both types of ownership. Rest assured that through a licensed estate agent you will always purchase a property ‘legally’; there is no legal reason why you can’t purchase a property which is owned buy a company, but all depends on your personal and financial status and requirements.

Our recommended lawyers will be able to advise you on the difference between the ownerships and their advantages.

Mortgages
Mortgage financing is available in Portugal from various reputable sources, and as elsewhere, can be tailored to suit individual requirements and compared for their competitiveness.

A range of financing options is available for buyers with sufficient income to service a loan. For Portuguese residents, Euro mortgages can be obtained for up to 90% of the property value. For non-residents, mortgages are available in any major currency for up to 75% of the property value or purchase price. Generally speaking most mortgages in Portugal are available for between 5 to 30 years. When it comes to determining a potential borrower’s eligibility for a particular mortagage most lenders apply the same criteria. They take into account the borrower’s income, their outgoings, their age, credit history etc., and proof of address, identity and earning will all be required.

Through our contacts at various banks in the region, you will be able to receive a provisional response to your mortgage application within 48 hours. This is of course of utmost importance; once you’ve found your dream home, you’ll want to able to proceed swiftly so the property can be taken off the market!