Property Deposit in Portugal: When Can You Get It Back?

In a Portuguese property transaction, the deposit paid under a CPCV is often called the sinal.

Portuguese law gives the sinal important consequences when the promised purchase fails.

The starting rule is:

• if the party who paid the deposit is responsible for the failure, the other party can normally keep it;
• if the party who received the deposit is responsible, the other party can normally claim double the deposit.

But real disputes depend on the CPCV and the reason the transaction failed.

When can a buyer lose the deposit?

A buyer is at serious risk where the CPCV is binding, the buyer fails to complete, the failure is legally attributable to the buyer and no contractual condition protects them.

A buyer who simply changes their mind is very different from a buyer protected by a financing or due-diligence condition.

When can a buyer claim double?

Where the seller who received the deposit is responsible for failing to perform, Portuguese law can allow the buyer to claim double the amount paid.

The exact remedy still depends on the contract and facts.

Mortgage refusal

The deposit is not automatically refundable because a bank refuses the mortgage.

If the CPCV contains no financing condition, financing failure may remain the buyer's risk.

Read: Buying Property With a Mortgage

Low valuation

A low bank valuation can create a funding gap even where the buyer is otherwise approved.

Whether that allows cancellation and recovery of the deposit depends on the CPCV.

A clause covering only outright loan refusal may not protect a buyer whose loan is approved for less than expected.

Due diligence problem

There is no automatic universal cancellation right because due diligence later discovers a problem.

If the buyer signed an unconditional CPCV first, the legal position can be much harder.

A due-diligence condition can protect the buyer where specified problems are discovered.

Read: Buying Property Due Diligence

Seller default and specific performance

If the seller is in default, the buyer can have significant remedies.

Depending on the case, the buyer may prefer double deposit, specific performance, damages or a negotiated settlement.

In qualifying cases, Portuguese law allows specific performance of a promise contract. The non-defaulting party can ask the court for a judgment producing the effect of the missing final declaration.

A buyer who still wants the property should get advice before accepting a refund or signing a termination.

Reservation fee versus CPCV deposit

A reservation agreement and CPCV are not necessarily the same contract.

Before paying a reservation amount, check who receives it, whether it is refundable, whether it becomes part of the CPCV deposit, whether the seller is bound and what happens if legal review fails.

How much deposit is normal?

Portuguese law does not impose one universal CPCV deposit percentage for every property purchase.

The amount is negotiated. The more money paid before completion, the more important the contractual protection becomes.

How THE-Ö can help

We can review the CPCV before the deposit is paid or assess an existing deposit dispute.

If the transaction has already failed, we can analyse who is in default, what the contract says and whether the buyer should seek repayment, double deposit, specific performance or another remedy.

Deposit already paid, or about to be paid?

Send us the CPCV, proof of payment and a short explanation of what has happened.