Mortgages

mayo · Post by **mayo** » Mon Oct 06, 2003 4:51 pm

We are hoping to purchase a villa in Carvoeiro.From a tax angle we are not sure the best way to raise the capital...Mortgage our home here in the UK and buy the villa cash or have a separate mortgage on the villa in Carvoeiro.

Guest · Post by **Guest** » Mon Oct 06, 2003 5:15 pm

Hi Mayo, you should get some good advice on this question given a day or so, however, bear in mind the capital gains tax in Portugal is 25% should you decide to sell it at a later date. Assuming of course they don't raise it. Good luck with the purchase. Banco Totta Acores do mortgages and they also have a UK base in London, I think I'm right in saying that a lot of owners with mortgages have switced to them or similar since the Abbey pulled out due to a total lack of understanding of the new rules and not responding to their existing clients. Try doing a search on Abbey and see what comes up. Not pretty. Mike Chislehurst

tricky · Post by **tricky** » Mon Oct 06, 2003 5:18 pm

With the mortage rates so low in the UK at the moment, and the fees
payable to overseas mortgage companies so high, you may find it easier and cheaper to remortgage your house - If you can. Sorry but that does not answer your tax question - try biffa

Wishing you sucess.
Tricky

big al · Post by **big al** » Mon Oct 06, 2003 9:52 pm

We too are in the process of purchasing a villa in CVO.

We have come to the decision that as we have cleared our old mortgage her in the UK, the simplest thing will be to raise the balance of the required capital her in the UK also. The only problem we're finding is the bewildering amount of different mortgage offers available, its almost impossible to make a clear comparison. The one thing we have noticed in the last few weeks is that long term fixed rate mortgages have almost disappeared, and the ones that are left have gone up significantly.

The type we're considering is a 'interest only repayment', similar to the old endowment type, but there is no endowment backing it. You only pay the interest on a monthly basis and at the full term the capital loan, so no lousy insurance company to loose all your money! You can also pay off lump sums at any time, either reducing the loan or totally clearing it.
And if it all goes wrong, you always can sell the villa!

Would be interested to hear others views on the subject, as we have'nt made our minds up yet.