Tiny House Financing in Portugal – Everything You Need To Know

May 20, 2025

How To Buy A Tiny House Without Paying 100% Upfront

Financing a tiny home isn’t as simple as taking out a traditional mortgage. In this guide, we explore financing options, from builder financing to personal loans and from business loans to grants.


The good news is: you don’t need to have 100% upfront cash to buy a tiny home. Let’s go through the financing options for buying a tiny house in Portugal.



Payment in Installments


First of all, most tiny home builders allow payment in installments, giving you a couple of extra months to gather the purchase amount. For example at Boxcode, payment is in 3 installments:


  1. 50% at award date
  2. 30% mid-production
  3. 20% three days before delivery


This allows for staggered budgeting and can be combined with other funding sources like loans or grants.



Grants


There are European Union investment funds available for eco-friendly, innovative, and rural development projects – all of which align well with tiny house initiatives.


We partner with an economist consultant who has the knowledge and experience to apply for EU funding (currently reaching €1.8 billion in approved EU investment funds). This may include programs such as:


  • Portugal 2030 and PRR (Plano de Recuperação e Resiliência): These funds aim to support green housing, rural revitalization, sustainable tourism, and circular economy projects.
  • Erasmus for Young Entrepreneurs: If your tiny house project is linked to starting a rural tourism or sustainable accommodation business, this EU program can offer co-financing.
  • Leader/PRODER Programs (via Local Action Groups): Especially relevant if your tiny house is placed in a rural area and connected to local economic development.
  • Smart Growth and Innovation Funds: If your project includes energy-efficient systems (solar panels, compost toilets, etc.), it may qualify for innovation-related grants.



To be eligible, projects typically need to:


  • Have a business or community impact
  • Be tied to legal land and local regulations
  • Show clear deliverables and sustainable outcomes


Boxcode works closely with grant specialists to assess your eligibility and handle complex applications - helping to unlock non-repayable funding that can cover up to 40-75% of project costs in some cases.



Business Loans


If you're building a tiny home for tourism, rental, remote work retreats, eco-stays, or mobile services, you may qualify for a business loan instead of a personal one. This applies both to individuals setting up small enterprises and to registered businesses.

In Portugal, business loans may be obtained through:


  • IAPMEI (Portuguese Agency for Competitiveness & Innovation) – which provides credit guarantees and subsidized loans for small businesses
  • Microcredit programs – offered via institutions like Millennium BCP Microcrédito or Associação Nacional de Direito ao Crédito (ANDC), especially if your project promotes social or economic inclusion
  • Startup Portugal incentives – If you’re under 40 and registering a business tied to tourism, innovation, or sustainability, you may be eligible for additional support
  • Local or municipal entrepreneurship incubators, which often offer co-financing, workspace, or subsidized loans for rural and tourism-based projects


Boxcode can help determine whether your tiny house qualifies as a business asset, and introduce you to partners who specialize in business credit consulting.



Personal Loan


For smaller amounts and if you meet the requirements, you can access a personal loan to buy a tiny house. At Boxcode we partner with a personal credit consultant, Carlos Abreu from Accipiens Crédito.


For foreign citizens to obtain bank loans in Portugal (including home loans or personal loans, such as for buying a tiny house), the minimum requirements vary slightly from bank to bank.


These are the most common criteria or minimum requirements for obtaining bank credit in Portugal:

  • Identification documents
  • Valid passport or EU Citizen Card
  • Portuguese Tax Identification Number (NIF)
  • Proof of address in the country of origin and/or in Portugal



Legal status in Portugal


  • Legal resident in Portugal (with temporary or permanent residence or a valid residence permit)
  • For non-residents, some banks still offer loans with stricter conditions and higher rates



Proof of Income


  • Employment contract or income statement (e.g. pay slips for the last 3 months)
  • IRS (personal income tax) declaration
  • Bank statements (3 to 6 months) to prove financial solvency
  • If self-employed: declaration of commencement of activity + proof of invoicing



Credit history


Credit history is analyzed in the country of origin and in Portugal (if it already exists). Some institutions may request an international credit report or bank references



Down payment


In the case of home loans or financing tiny houses, banks require a down payment of between 10% and 30% of the value of the property, especially if the client is a non-resident, and the duration of the contract is usually reduced to 10 years.



Age and ability to pay


  • Minimum age: 18
  • Maximum age for final payment of the debt: usually 75 years
  • The effort rate (percentage of monthly income committed to debt) must be below 30-35%



Tiny House Loans: Home Loan or Personal Loan?


As an innovative concept, tiny houses can be financed as personal loans or home loans, depending on the legalization of the land and the project.


Tiny houses are still a relatively new concept in traditional financing. Banks such as BPI, CGD, Santander, Novo Banco, etc. can:


  • Include this type of project as a personal loan (with higher rates and shorter terms), or
  • Require the tiny house to be on legal land with a housing license, so that the financing can be done as a housing or construction loan.



Get the Right Support


The BOXCODE company, working with a credit broker such as Accipiens, is ideal for finding the financial product best suited to your profile.


Together with our funding and grant partners, BOXCODE can help you explore:


  • EU grants for rural, ecological, or tourism-based projects
  • Business loans for eco-tourism stays, short-term rentals, mobile cafés, wellness cabins, or remote work retreats
  • Personal or housing/construction loans tailored to your situation


BOXCODE and our partners will help you find the best financing solution to make your project a reality.



*Information provided is for educational purposes only. Boxcode Lda does not provide financial or legal advice.

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