Getting divorced in Portugal: what are the options if you own a house together?

What happens to the family home when a relationship comes to an end? Portugal has seen an increase in marital break-ups that end in divorce due to the COVID-19 pandemic. With a divorce in Portugal, like anywhere else, there are several issues that both parties have to deal with, but there is one that emerges as a priority: what happens to the house? With the help of DECO, the Portuguese Association for Consumer Protection, let's have a look at a particular divorce case and some tips to help you manage the problem of property in the midst of a divorce in the best possible way.

My husband and I are getting a divorce. We have a joint apartment and we don't know what to do. What are the options? This situation is never straightforward, but the rules in Portugal are very clear and tight on the question of the family home, in a divorce. The family home is considered the centre of the domestic and social organisation of the family community, and for that reason it can be handed over or assigned to both spouses. Let's have a look at all the options:

What happens if the apartment is rented? 

The future of the house is decided by agreement of the couple. They can opt for the transfer or concentration in favour of one of the spouses, subject to the landlord's consent. 

What happens if the house is owned by one or both spouses?

The allocation of the family home and the ownership of this property are different situations. The family home can be assigned to either of the members of the couple, even if it is one of the other's own property. The court will decide according to the needs of each and the interests of the children, if any. 

If your situation is similar to the one referred to, i.e. the house belongs to the other spouse, then it must be noted that the house is delivered against a payment, the amount, time and other details of the contract being defined by the court. 

What about if there is a mortgage? 

This question is the most common among couples currently getting divorced. First of all, banks in Portugal are forbidden from increasing credit charges. And this applies not only to divorce, but also to the judicial separation of persons and property, to the dissolution of the partnership or until the death of one of the spouses. Aggravating means, in particular, increasing the spread in the renegotiation of the housing credit agreement. 

In this case, whoever receives the loan has to prove that the household has an income for an effort rate of less than 55% or 60% if they have two or more dependents (children, for example). 

What if we decide to sell a house (bought together) to a third party? 

Divorced couples can make this decision and even one of the spouses can decide to buy their share from the other. In this situation, the member of the couple selling will have to pay tax for the capital gains obtained. The gains from this sale may not be taxed if the value is reinvested in another permanent home of their own. If not, half of the gain from the sale will be included in the IRS.

The whole situation of separation is complex and difficult. If the former couple is unable to resolve their disputes, you can request support from the Family Mediation System. The right information is again the key to avoiding further problems and conflicts.