If you’re looking to purchase property in Portugal, you’ve probably come across the term TAEG during your mortgage research. But what exactly is TAEG, and why is it important for foreign buyers like yourself?
Let me explain. TAEG stands for “Taxa Anual Efectiva Global”, which is the annual percentage rate that includes all the costs associated with your mortgage. This is an important figure to understand because it gives you the total cost of your loan, not just the interest rate.
As a foreign buyer, the TAEG is especially critical because mortgage terms and fees can vary quite a bit compared to your home country. Things like application fees, evaluation costs, and even early repayment penalties can all impact your total mortgage expenses. The TAEG helps you see the big picture.
When evaluating mortgage options, be sure to ask each lender for the TAEG. This will allow you to accurately compare the true cost of different loan products, beyond just the advertised interest rate. Keep in mind that the TAEG can fluctuate based on factors like the loan amount, term length, and your personal financial situation.
It’s also important to review the full mortgage agreement carefully before signing. Make sure you understand all the terms and conditions, including any special requirements for foreign buyers. This will help you avoid any surprises down the road.
The bottom line is that TAEG is an essential metric for foreign buyers in Portugal. By understanding this annual percentage rate, you can make a more informed decision about your mortgage and ensure you get the best deal possible on your new property. Let me know if you have any other questions!
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