Do you want to apply for a housing loan? Find out how the new rules can affect approval.

Who is preparing a housing loan application should pay attention to the rules governing the assessment of financial capacity. Among the most relevant factors are the effort rate, the loan term, and other credit responsibilities.

The reference effort rate is 45% and considers the total monthly loan payments in relation to net income. The maximum reference term is 40 years for customers up to 35 years old and 35 years for customers over 35 years old.

These rules do not mean all customers with an effort rate below 45% have guaranteed approval. The bank continues to make an individual solvency assessment.

What has changed in the credit assessment?

When requesting a housing loan, the bank needs to assess whether you will have the ability to meet the installments throughout the contract.

Poupança no Minuto analyzes various elements, including income, expenses, age, professional situation, and credit responsibilities.

Among the main indicators is the effort rate.

How does the 45% effort rate work?

The effort rate compares the total monthly loan payments with the monthly net income.

Imagine a household with 3,000 euros of net income.

A 45% effort rate corresponds to 1,350 euros in monthly credit charges.

If the household already pays 400 euros for other credits, the new housing loan installment must be analyzed considering these costs.

This is important because it's not just about the house payment.

The maximum term is also important

Maturity limits depend on the client's age.

For customers aged 35 or younger, the maximum reference period is 40 years.

For customers over 35 years old, the maximum term is 35 years.

A longer term can allow a lower monthly payment.

However, there is a consequence: the longer it takes to pay the credit, the more time there will be for interest payment.

Therefore, choosing the maximum available term is not always the most economical option.

Other debts also count

If you already have a car loan, personal loan or other obligations, these payments are included in the analysis.

The bank needs to assess the entire set of financial commitments.

For example:

Net income: 2800 euros.

Car loan: 250 euros.

Personal loan: 150 euros.

New house payment: 700 euros.

Total of installments: 1.100 euros.

Effort rate: approximately 39.3%.

In this example, other credits represent an important part of the available financial capacity for the new house.

And the entrance to the house?

The solvency assessment is not the only limit to consider. There is also a limit related to the property value.

For own and permanent housing, the loan amount should, in general, not exceed 90% of the lower of the purchase price or the appraisal value.

Therefore, the buyer needs to consider not only the monthly payment, but also the own capital required for the purchase and the remaining associated costs.

Effort rate below 45% guarantees approval?

No. Banco de Portugal sets references and prudential limits, but the decision to grant credit still depends on the institution's analysis.

The bank may consider other elements that affect payment ability.

In addition, the approval of a housing loan also depends on the characteristics of the operation and the property.

How to prepare a loan application better?

Before proceeding, it may be useful:

Collect income documents

Identify all current credit installments

Check the credit responsibility map

Set the maximum amount you want to spend on the house

Calculate available equity capitals

Compare proposals from different institutions

Analyze the total cost of financing

The better prepared you are, the easier it will be to see what type of financing makes sense for your budget.

Do a simulation

Are you buying a house and want to know how much you can borrow and what the payment could be?

What is the effort rate?

It is the relationship between the total monthly loan installments and the monthly net income.

Do other credits affect approval?

Yes. The payments of other credits are considered in the effort rate calculation.

Can I get a loan at 40?

The maximum reference period is 40 years for customers up to 35 years old, subject to the operation's other conditions.

Longer term is better?

It can reduce the monthly payment, but tends to increase the total interest cost.

Do the new rules guarantee approval if you meet 45%?

No. The institution continues to assess solvency and other elements of the operation.