Big change in housing loans in Portugal: Approximately 80% of new loans are now mixed interest

The interest rate preference of home loan borrowers in Portugal has changed significantly in just three years. Banco de Portugal data shows that the share of mixed-rate contracts in new mortgages has increased from around 10% at the beginning of 2023 to around 80%.

The reason behind the change is that banks offered more attractive fixed interest rates in the first years and Euribor fluctuations in recent years led consumers to hedge against short-term interest rate risk.

However, there is an important detail here:

A mixed interest loan is not a loan with a fixed interest rate for the entire duration of the loan.

How does compound interest work?

According to the definition of Banco de Portugal, mixed interest housing loan consists of two periods.

In the first part, the interest is fixed.

For example, for the first three or five years of a 30-year loan, the customer may pay a predetermined fixed interest rate.

After this period ends, the loan switches to variable interest.

In the second stage, interest is usually:

Euribor + bank spread

It is calculated based on .

Therefore, just because the monthly installment is fixed at the beginning does not mean that the loan will be protected from interest rate changes for 20 or 30 years.

From approximately 10% to 80% in three years

In early 2023, the share of mixed-rate loans in new mortgage contracts in Portugal was around 10%.

Today the rate is about 80%.

This is one of the most significant structural changes in the Portuguese mortgage market.

Banco de Portugal is behind the change He states that there is competition between banks and mixed interest products have more advantageous pricing than variable interest products in the initial period.

What happens when the fixed period ends?

The critical date for mixed loans is the day when the fixed interest period ends.

For example, if a mortgage that is fixed for the first three years is later switched to Euribor, the monthly payment may change depending on the Euribor level at that date.

If Euribor has increased, the installment may increase.

If it has fallen, the installment may decrease.

Therefore, when choosing a mixed interest loan, not only the monthly payment in the first two or three years, but also the spread after the fixed period, Euribor maturity and total cost should be compared.

Some customers renegotiate before switching

One of the striking details in the Banco de Portugal data is that some customers using mixed rates renegotiated their loans before the fixed period ended.

In approximately 20% of some mixed-interest contracts made in 2023, customers agreed on new terms with the bank before moving to the variable interest rate period.

This also shows that the second stage of the mixed interest loan does not have to be accepted automatically.

The customer can renegotiate with his current bank or, if the conditions are suitable, consider the options of transferring the loan to another bank.

Three numbers that home buyers should look for

When comparing an offer with mixed interest only in advertising Looking at the first interest rate that appears can be misleading.

In particular, three elements should be evaluated together:

How many years is the fixed interest period?

The spread to be applied when switching to the variable period,

MTIC and TAEG, which show the total cost of the loan.

The offer that provides lower installments in the first years may not necessarily be the cheapest option for the entire loan.

Resources

Banco de Portugal — Sistema Bancário Português, 2nd trimester de 2026

https://www.bportugal.pt/publicacao/sistema-bancario-portugues-2o-trimestre-de-2026

Banco de Portugal — Taxas de juro no crédito à habitação

https://clientebancario.bportugal.pt/pt-pt/taxas-de-juro-no-credito-habitacao

ECO — September 25, 2026

https://eco.sapo.pt/