Housing credit is a loan for obtaining, building or renovating a property, among other possibilities, which is characterized by always being related to real estate issues.

This way, you can turn to building a property. Also, for the renovation of an existing one or even for the purchase of one that is already ready.

Another possibility of using this type of credit is to purchase land where, in the future, the construction of a property will take place.

Therefore, unlike personal credit, housing credit has a commitment. The use of its value must always be for real estate purposes.

There are 5 types of housing credit available in Portuguese banks. Check below for more details on what they are and how they work.

The first type of housing credit corresponds to the amount available for the purchase of property. In other words, he focuses on purchasing real estate.

In this case, the acquisition refers to the construction itself, and not the land. You can go back to purchasing a ready-made property that does not require major renovations.

For example, it can be useful when purchasing apartments in newly built buildings.

Another type of housing credit corresponds to its use to build a new property on land that the individual already owns.

It is common for the value to be granted in tranches here. In other words, according to progress in the work.

This type of housing loan is very similar to the previous one, construction. The difference is that here the property already exists. Therefore, credit goes to reforms and changes.

Credit can be useful in a property that is already owned by the individual or one that he or she is in the process of purchasing.

Once again, the release of values progresses along with the construction, so that it occurs little by little, in tranches.

The fourth type of housing credit addresses two objectives at the same time. After all, it encompasses both the value for purchasing the land and for building the property.

Finally, the last type of housing credit is transfer. In other words, in this case there is already a loan and it is only transferred to another institution.

The transfer takes place with the aim of ensuring that the customer finds better payment conditions, such as lower fees.

In addition to the types of housing credit, it also has classifications understood as purposes. Check out what they are in the items below.

The first purpose for which housing credit can be used is the acquisition of permanent housing.

In other words, to acquire the property or renovate another that will be a family home. In this case, the family group does not own any other property.

This purpose refers to cases in which the family group already owns a property, but wishes to acquire or build another.

In this case, then, housing credit will be useful to purchase a summer property, for example. Or, to use the property for rental purposes.

Finally, the third and final purpose of a housing loan corresponds to its use for investment purposes.

This corresponds to the loan to acquire a property (or build it, as we saw above) for rental purposes exclusively. This will generate profit for the family.

The conditions relating to the amount and repayment period of a home loan vary according to each case.

After all, the conditions depend on the individual's financial situation, guarantees and their image in the market.

On the other hand, they also change depending on the financial institution. They vary in terms of the maximum term or maximum amount they make available in operations.

There are some conditions that apply to all banks when it comes to granting credit. They also affect housing. See what they are:

Therefore, only those who live in Portugal, have income and do not have a bad name will be able to take out a loan.

For housing credit, it is up to the individual to provide proof of residence and income at the time of application.

Furthermore, by offering an asset as collateral – such as the property itself – it is possible to reduce the operation's interest rates and improve payment conditions.

Finally, there are some essential precautions when taking out credit. Check out what they are!

Before doing any business, count on a quality bank. Research the reputation of the institutions that offer the credit you want. So, avoid scams!

In addition to knowing which institutions have a good reputation in the market, pay attention to other signs. For example, no bank requires an initial deposit to grant credit.

If this happens, avoid this option, as it smells like fraud!

When you have proposals from quality banks in hand, compare them. So, see which ones are more expensive and also which ones are more advantageous.

Finally, remember to know your budget and financial conditions before closing a deal. It is essential that you have the financial capacity to support the mortgage installments.

And, if you want options to start and do research, find out about BNI Housing Credit below. The application is online and you have up to 30 years to pay it off!