Ancillary Credit Intermediary
Intermediates credit only as a complement to its main activity, usually for property developers or car dealers. It is a Banco de Portugal registration category with a more limited scope of activity.
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A quick reference with the most common credit terms in Portugal. Search by keyword or filter by category to find what you need in seconds.
Glossary terms
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Intermediation -
Guarantees Aval guarantee
An autonomous and joint personal guarantee, usually given on promissory notes or bills of exchange. The aval provider is liable on the same terms as the main debtor and independently of the guaranteed debt’s existence.
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Documents Bank valuation
An estimate of the property’s market value made by an independent expert appointed by the bank. It determines the LTV and the maximum approved financing amount.
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Affordability Borrowing capacity
The maximum amount of credit a household can take on sustainably. It is calculated from income, existing commitments, expected rates and the desired maturity.
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Operation Credit score
A score assigned by banks to each client’s risk profile, based on financial history, income, professional stability and banking relationship. It influences approval and the spread offered.
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Operation Credit transfer
An operation in which the client moves the loan from one bank to another while keeping the mortgage security. It can obtain better conditions without IMT costs and with simplified registration rules.
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Affordability Debt effort ratio
The percentage of monthly household income used to pay credit instalments. It is the practical equivalent of DSTI used by banks when assessing each application.
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Operation Default
Continued failure to meet the credit contract obligations. It can lead to mortgage enforcement, reporting to the Central Credit Register and default interest.
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Affordability DSTI
The ratio between monthly credit commitments and the household’s monthly net income. It is a macroprudential indicator used to assess debt sustainability.
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Operation Early repayment
Partial or full payment of outstanding capital before the contracted term. It may carry a legally limited fee and reduces future interest under the contract.
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Rates Euribor
A European interbank market reference rate, used as the index for most variable-rate loans in Portugal. Contracts commonly use 3, 6 or 12-month tenors.
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Costs Fees
Charges collected by the bank at specific moments, such as opening, processing, early repayment or contract changes. They are limited by law and must appear in the FINE or FIN.
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Documents FIN
The equivalent of FINE for consumer credit, such as personal, car or card credit. It presents the offer conditions uniformly before contracting.
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Documents FINE
A mandatory document delivered by the bank before the mortgage credit contract is signed, with the essential offer conditions presented in a way that can be compared across institutions.
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Operation Fixation period
In a mixed rate, the initial interval during which the rate remains fixed before becoming variable. In a variable rate, it is the interval between rate reviews, usually 3, 6 or 12 months.
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Rates Fixed rate
A structure in which the interest rate remains constant throughout the contract term. The instalment does not move with Euribor, giving greater predictability.
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Operation Grace period
A period during which the client pays only interest and does not repay capital. It lowers the initial instalment but increases the total cost of credit over the contract.
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Guarantees Guarantor
A person who takes responsibility for paying the debt if the credit holder defaults. The guarantor answers with their assets up to the agreed limit and may be required when the borrower has lower capacity.
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Costs IMI
An annual tax paid by the property owner to the municipality where the property is located. It is not part of the credit contract but should be included in the housing budget.
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Costs IMT
A tax paid when buying a home. It varies according to the property type, purchase value and purpose, such as own permanent residence, secondary home or rental.
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Operation Instalment
The monthly payment owed by the client, made up of capital and interest. It can be constant or vary with the rate, depending on the contracted structure.
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Guarantees LTV
The ratio between the loan amount and the property value, using the lower of purchase price and bank valuation. It determines the bank’s risk and influences the spread applied.
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Operation Maturity
The total term of the credit contract, from the start to the final payment. In mortgage credit it typically ranges from 10 to 40 years and depends on the age of the oldest borrower.
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Rates Mixed rate
A structure that combines an initial fixed-rate period followed by a variable-rate period until the end of the contract. It offers stability at the start and flexibility later.
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Guarantees Mortgage security
A real security registered over the property in favour of the bank. In prolonged default, the bank may enforce the security to recover the outstanding amount.
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Costs MTIC
The sum of all expected payments over the contract, including capital, interest and charges. It shows the absolute cost of credit in euros and complements the TAEG.
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Documents Pre-approval
A preliminary analysis of the client’s financing capacity before there is a specific property. It does not bind the bank but gives visibility over the available search budget.
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Operation Renegotiation
An agreement between client and bank to change contract conditions, such as rate, term or instalment, during the life of the credit. It usually aims to ease financial effort or capture better market conditions.
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Rates Spread
The margin the bank adds to the reference rate to form the final credit rate. It reflects the perceived client risk, the LTV and the commercial relationship with the institution.
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Costs Stamp Duty
A tax charged by the Portuguese State on credit operations. In mortgage credit it applies to the loan amount at contracting and to interest each month.
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Guarantees Surety
A personal guarantee in which a third party undertakes to pay the debt if the borrower does not. It increases the bank’s security and creates liability for the guarantor’s assets.
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Rates TAEG
The total yearly cost of credit as a percentage, including interest, fees, compulsory insurance and taxes. It lets you compare offers from different banks on the same basis.
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Rates TAN
The interest rate applied to the outstanding capital, excluding fees and other charges. It is the basis used to calculate the monthly instalment.
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Intermediation Tied Credit Intermediary
Works exclusively with one or more creditors under a tied contract and does not charge the consumer. Remuneration is paid by the bank. This is the Banco de Portugal registration category applicable to Qredit.
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Intermediation Untied Credit Intermediary
Works with several creditors without exclusivity and may charge the consumer for services. It presents offers from more banks with a broader comparison logic.
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Rates Variable rate
A structure in which the rate is recalculated periodically according to the reference index, usually Euribor, plus the spread. The instalment changes during the contract.
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The definitions follow regulatory terminology applicable in Portugal. For official definitions, consult the Banking Customer Portal.