international mortgages

cape verde

Essential information for buying properties in Cape Verde

Buying property abroad is not necessarily the same as buying in the UK; there is other essential information you need to be aware of both before and during your property purchase.

It is of paramount importance to seek independent advice from an overseas solicitor.

You need to ensure that you will have full title to the property on completion and that you have the appropriate documents e.g. the “Certidao Predial” available for the lender. Other documents such as the official plans of the property, a plan of the site and a copy of the certidao matricial, fiscal numbers and may be required before the lender is able to carry out a valuation.

You should check with the estate agent and/or your lawyer that you are aware of the costs charged by the legal and Government authorities for purchasing a Cape Verde property, e.g. UIP Tax is normally charged on the ‘Declared Price’. The solicitor may be incorporating costs for assigning the mortgage within his charges, along with the title deeds to the land registry. You should establish the actual cost before proceeding with a loan application. The lender will also have their own legal costs for assigning the loan, the cost of which they will normally advise you when they issue the mortgage offer. These associated fees/taxes are typically between 10% - 15% of the properties purchase price.
Before signing the sales contract, the bank will require a copy of this document to be forwarded with the relevantapplication form. However you are able to sign this contract with the clause “subject to mortgage finance” as the contract, once signed is legally binding, and you may have to forfeit any deposit monies paid.
Properties can be purchased in either individual or joint names.

Cape Verde follows Portuguese law very closely. There is a Notary and registry system in place.

You will need to appoint a sworn translator to translate documentation for you.

A lawyer should always be appointed to check title deed and registration of property and to ensure your legal rights are protected at all times.

On finding a property you will put down a reservation fee or deposit this will usually be a around 10% of the purchase price although developers of off plans will have a different payment structure. Always ensure any deposits are refundable until you have secured any funding you require for completion. Mortgages and banks are few and far between in Cape Verde so be aware options will be limited using the property in Cape Verde for security. Interest rates are high in comparison to other jurisdictions.

Mortgages in principle can be obtained subject to property but a formal offer of lending can only be made after the property is known and evaluated by the bank. Banks rarely undertake formal valuations and will assess in general the property to be worth or below the purchase price being paid.

Costs of buying include:-

Stamp Duty 3 % of purchase price
Land registry 3% of purchase
Notary fees are usually a set price
Registry of loan and Notary fees 3% of lending
Mortgage deed tax 3% of lending
Bank arrangement fee

Mortgages are available for Villa Verde Developments only

Eligibility and criteria

Loans are available as Euro mortgage only
Repayment mortgage only
The maximum loan to value for a purchase is 50%
Remortgages are not available
The maximum term of any mortgage is 20 years (to age 75 maximum)
The minimum loan amount is €25,000 with no maximum

Affordability

To qualify for a mortgage in Cape Verde, a calculation is used to establish whether you can afford to maintain the mortgage repayments. This will automatically happen when you complete our enquiry form and we will not charge you for this service.

Your existing liabilities, including your UK mortgage or rental payments, loan, credit card payment and maintenance are taken into account, together with the proposed Cape Verde mortgage payments. All this must not typically exceed 35% of your monthly net income. For example if your net joint income is £2500, 35% of this equates to £875. If your only liability is your current UK mortgage payment of say £300 per month, this would leave a balance of £575 for your Cape Verde mortgage repayment.

The amount that you can borrow is also restricted by the maximum loan to value as mentioned under Eligibility and criteria.

Proof of income requirements

If you are employed:

Your last three months payslips
Your latest P60 and/or employers reference
Your last six months personal bank statements

If you are self employed

Your last two years audited accounts & last two years tax returns.
Your last 3 months personal bank statements.

If you would like to speak with a representative to discuss your requirements please call +(34) 677 874 948

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