Key figures — as of 2026-09-17: 0.5% early-repayment fee on variable-rate home loans is back since 1 January 2026, after a three-year exemption introduced in 2022 — Fixed-rate loans keep their separate 2% cap, unaffected throughout — Two Budget 2026 proposals to make the exemption permanent (PS) or unify the fee at 0.5% for all mortgages (Chega) were both voted down — GrowIN calculation: paying down €40,000 of variable-rate mortgage capital now costs €200 in bank commission that would have been free a year earlier.
The exemption is over
Anyone with a Portuguese home loan on a variable rate, and thinking about paying it off faster, now faces a cost that simply didn't exist for the past three years. From January 2026, everyone with a home loan goes back to paying to prepay part or all of their credit, regardless of purpose or type of interest rate. For foreign buyers who took out Euribor-linked mortgages during the low-rate years, or refinanced during the 2022–2024 rate shock, this is a real change to the maths of overpaying a mortgage.
The mechanism is simple. If it's fixed, the 2% commission applies, but if it's variable, it's 0.5%; now, with the end of the exceptional regime, clients with a variable rate on their primary home financing will also go back to paying a maximum commission of 0.5%. To put it in real terms: on an early repayment of 20 thousand euros, the amount to pay will be 100 euros.
Why the fee disappeared, then came back
The waiver dates to the Euribor spike of 2022. The regime exempting home loan repayment fees on variable-rate contracts ends at the end of the year — DECO PROteste laments the end of the measure that had been in force for the last 3 years. It was a government-mandated relief measure, not a permanent change to banking law, and it was always due to lapse unless parliament acted.
Parliament didn't. During the state budget debate for 2026, two parties tried to change that. The PS proposed "exempting from commissions, on a permanent basis, early repayment operations for home loan contracts under a variable-rate regime," according to Jornal de Negócios. Chega went the other way, proposing a flat cap for everyone. The party led by André Ventura wanted to go further, proposing a fixed commission of up to 0.5% on repayment regardless of the contracted interest rate. Both proposals failed. The PS proposal ended up voted down with votes against from PSD, CDS and Iniciativa Liberal and abstention from Chega. As Jornal de Negócios summed it up, the change was simply that the early-repayment commission on variable-rate credit, which had been suspended since 2022 and can go up to 0.5%, returns in January.
What this actually costs you
The fee only bites when you actively pay down capital ahead of schedule — either partially, to shrink your monthly instalment, or in full, often as part of refinancing to a fixed rate or switching banks. It's charged on the amount repaid, not the outstanding balance, and stamp duty is added on top of the commission itself. Fixed-rate borrowers were never part of the exemption and continue under their own regime: clients with fixed-rate contracts and those with credit for second homes always continued paying early-repayment commissions — banks can charge, at most, 2% on the amortised amount.
Here's the number that matters for planning purposes. Say a foreign buyer with a variable-rate mortgage on a primary residence in Portugal receives a bonus, sells a property abroad, or simply wants to cut their Euribor exposure, and decides to pay down €40,000 of principal. Under 2025 rules, that cost nothing beyond the transfer itself. Under 2026 rules, at the statutory 0.5% cap, it now costs €200 in bank commission — money that would have stayed in the household's pocket twelve months earlier. Scale that to a €100,000 lump-sum repayment, a realistic scenario for someone selling an overseas asset to clear a Portuguese loan faster, and the fee reaches €500. It's not large by the standards of a property transaction, but it changes the calculus for anyone timing a prepayment or refinance.
"The fee itself is modest, but the psychology matters — a cost of zero became a cost of something overnight, and that changes when people act," notes GrowIN Portugal Editorial.
Practical implications for foreign homeowners
If you hold a Portuguese mortgage indexed to Euribor and are weighing an overpayment or a switch to a fixed rate, the fee is now a fixed input into that decision, not a bonus that might disappear. Banks are required to calculate and disclose the exact commission before you formalise a repayment request, so ask for the figure in writing before committing. It's also worth checking your original loan contract: some banks negotiated bespoke exemptions into individual agreements that survive regardless of the general regime, per Doutor Finanças' note that the only exception is contracts where an exemption was agreed.
Consumer body DECO PROteste hasn't given up on reversing this. DECO PROteste laments the end of the measure that ran for the last three years and continues to defend that the exemption become permanent, and that the fixed-rate commission drop from 2% to 0.5%. Whether that lands in a future budget cycle is genuinely uncertain — nothing currently on the table suggests movement before 2027 at the earliest.
What to watch next
Euribor's own trajectory now matters more than usual: if rates keep drifting down through 2026, the incentive to prepay or refinance grows even with the fee attached, since the interest saved over the remaining term can still outweigh a one-off 0.5% charge. Anyone weighing a mortgage decision alongside a Portuguese property purchase or residency move should check current terms directly with their bank before committing, and consult our relocation resources for the wider costs of buying and financing property here as a foreigner. GrowIN's services team can help you weigh the numbers before you commit to a prepayment or refinance.
The takeaway is straightforward: the free ride on paying down a Portuguese variable-rate mortgage is over, and anyone budgeting for early repayment in 2026 should build the 0.5% cost into their plans rather than assume it away.