Once you have agreed a price and the seller has accepted your offer, the next step in a Portuguese property purchase is the CPCV — the Contrato de Promessa de Compra e Venda, or promissory contract. This is the legally binding agreement that commits both buyer and seller to the transaction before the final deed is signed.
Understanding the CPCV is essential. It is where the deal is made — and where buyers can be caught out if they do not know what they are looking at.
What is a CPCV?
The CPCV is a private contract between buyer and seller that sets out the agreed terms of the sale: price, deposit amount, timeline to completion, and the conditions under which either party can withdraw.
It is signed before the final deed (escritura) and typically requires the buyer to pay a deposit — usually 10–30% of the purchase price — at the time of signing.
The CPCV is not mandatory in Portuguese law, but it is almost universal in practice. It gives both parties legal protection during the period between agreeing the deal and completing it (typically 1–3 months, sometimes longer).
The deposit (sinal)
The deposit paid at CPCV stage is called the sinal. Typical amounts:
- 10% — the most common for straightforward transactions
- 20–30% — common when there is a mortgage involved (banks sometimes require the full deposit to be in place before the valuation)
- Higher deposits can sometimes be negotiated if the seller wants greater security
Important: The sinal has a specific legal status in Portuguese law under the regime of sinal penitencial (default penalty regime):
- If the buyer defaults (pulls out without legal justification): the seller keeps the full deposit
- If the seller defaults (pulls out without legal justification): the seller must return double the deposit to the buyer
This mutual penalty structure gives both parties strong incentives to complete. The buyer risks losing their deposit; the seller risks paying double back.
What a CPCV should contain
Your lawyer will review and negotiate the CPCV before you sign. The key elements are:
Parties: Full legal names, NIF numbers and addresses of buyer and seller.
Property identification: Full description of the property, including the caderneta predial (land registry extract) and caderneta urbana reference numbers.
Purchase price: The agreed sale price, in euros.
Deposit amount: The sinal amount and how it will be paid (bank transfer, to whom, by what date).
Completion date: The agreed date for the escritura. This is usually expressed as on or before a specific date, with a mechanism for extension by mutual agreement.
Conditions: Any conditions attached to the sale — most commonly:
- Subject to mortgage approval (if the buyer is getting a Portuguese mortgage, the CPCV should include a clause allowing them to withdraw and recover their deposit if the mortgage is refused)
- Subject to satisfactory due diligence (though most due diligence is done before the CPCV is signed)
Penalties: Clear statement that the sinal penitencial regime applies.
Guarantees: The seller’s representations about the property — that it is free of debts, encumbrances or liens; that there are no outstanding planning or tax issues; that the habitation licence is valid.
Before you sign: due diligence
Your lawyer should complete all of the following before you sign the CPCV — not after:
- Title search: Confirm the seller has clean title with no mortgages, charges or legal restrictions (certidão do registo predial)
- Tax status: Confirm no outstanding IMI arrears (caderneta predial)
- Planning status: Confirm the property has a valid habitation licence (licença de habitação) and that no illegal works have been carried out
- Building condition: An independent survey is advisable for older properties — Portuguese law does not require one, but it is good practice
- Energy certificate: Required by law for all property sales
- Condominium status: Check there are no outstanding condomínio fees (dívidas de condomínio) attached to the property
If any of these checks reveal a problem, your lawyer can negotiate to resolve it before signing — or advise you to walk away.
Sinalização vs CPCV
You may encounter the term sinalização — this is a simpler form of reservation, sometimes called a reserva. It is a smaller initial payment (often €5,000–€10,000) made to take the property off the market while due diligence is completed and the CPCV is being prepared. The sinalização is generally governed by the same sinal penitencial rules.
Not all transactions use a sinalização. In competitive situations, buyers sometimes move directly to the CPCV.
Timeline: CPCV to escritura
The period between CPCV and escritura is typically 1–3 months, allowing time for:
- Mortgage valuation and approval (if applicable)
- Final due diligence checks
- Preparation of escritura documents
- Scheduling the notary appointment
Extensions are common and generally agreed by mutual consent. If you need more time, this is usually negotiable — the seller would rather extend than lose the deal.
One final point
Never sign a CPCV without your lawyer present or having reviewed the document in detail. The CPCV is legally binding the moment both parties sign — there is no cooling-off period in Portugal for property transactions. Once you have signed and paid the deposit, the sinal penitencial regime applies.
We work alongside our clients’ lawyers throughout the CPCV process to make sure nothing is missed. Book a free call if you have questions about where you are in the process.