In July alone, applications rose by €1.2 billion, the largest monthly increase recorded since 2009.

Data from the Bank of Portugal show that Portuguese households have never owed the bank as much in terms of mortgage loans as they do now. Loan applications have been rising every month, with July recording the highest growth since 2009.

The same data from the Bank of Portugal show that total loans reached €118 billion in July. Compared with June 2026, applications for bank loans increased by €1.2 billion.

Reasons for the increase

The rise in mortgage applications can be explained by the government’s guarantee scheme, which allows young people up to the age of 35 to borrow the full purchase price of a property from the bank.

The guarantee began with a budget of €1.2 billion in 2025 and has since been increased by the Government to a ceiling of €2.3 billion.

Another reason for the rise in applications may be households’ need to pre-empt the Bank of Portugal’s new measures on granting bank loans, which came into force on 1 August. The measures aim to reduce demand for credit, which is being driven by the public guarantee provided to young people.

In total, the value of mortgage loans applied for by private individuals reached €152.5 billion in July. As for businesses, the value of loans is reported to have reached €78 million.