What is the maximum age to apply for a mortgage loan?

What are the maximum financing deadlines for housing credit?

Since April 2022, the maximum financing deadlines for home loans have been reduced. At this time, those wishing to buy a house with a new loan will have a lower limit. These limits are imposed according to the age of the borrowers.

In other words, customers who are 30 years old or younger can take out a home loan with a maximum term of 40 years; borrowers between 30 and 35 years old can have a maximum term of up to 37 years, and customers over the age of 35 can have a contract lasting up to 35 years.

According to the Bank of Portugal, the reduction of these limits aimed to preserve banking institutions from facing excessive risks when granting new credits, promoting "access to sustainable financing by consumers, minimizing the risk of default."

But in the case of the property being used as a secondary residence, the maximum financing period can be 30 years, regardless of the age of the holders. It may also happen that if the clients pose a credit risk, through analysis, the financing period may be limited to 30 years.

But is there a maximum age limit to apply for a home loan?

Yes, in most banks. As a rule, banking institutions only allow you to take out a home loan until the age of 75.  

This also applies to the age you have at the end of the credit agreement. In other words, if you are over 35 years old, you can only have a maximum financing term of 35 years, as long as your age at the end of the contract does not exceed 75 years.

For example, if you take out a home loan at 45 years old, most banks will only grant you a maximum financing limit equivalent to 30 years (because you will be 75 years old at the end of the contract). Therefore, in practice, you can only have a maximum contract duration limit of 35 years, between the ages of 35 and 40.

Until the age of 75, the older you are, the less credit maturity banks allow and you will have to pay back the loan in less time.

Note, however, that there are banks that can finance up to 80 years of age of the oldest holder, as long as they do not exceed 30 years of maximum financing term (in the case of clients over 50 years old).

What are the advantages and disadvantages of hiring credit at an older age?  

Hiring a mortgage at an older age has its pros and cons. Paying off the loan in less time can have advantages and disadvantages.

When the term of the financing is shorter, there are fewer installments to pay, which means you will also not pay as much interest. By lowering the Total Cost of Credit Imposed on the Consumer (MTIC), the credit becomes cheaper.

Another advantage is the fact that the deadline ends more quickly and you don't have the burden for a long period of time to recover the family budget.

If you still have doubts about the deadlines for housing loan financing, or any other questions about this process, you can rely on the help of credit intermediaries Poupança no Minuto. With a free service, they clarify all questions and do not leave your side throughout the entire process of contracting a home loan for your new house.