Early redemption of PPR to pay off mortgage will be penalized in 2025.

In 2025, it will not be possible to redeem PPRs early to pay for a mortgage loan.

The early rescue of Retirement Savings Plans (PPR) for housing credit payments will be penalized again in 2025, as the legislation suspending that penalty was not extended.

This possibility was introduced in 2022, as part of a series of measures to mitigate the impact of inflation on families' income. The measure allowed the early withdrawal, without penalties, of retirement savings plans, education savings, and retirement/education savings for the payment of mortgage installments, without the need to return tax benefits in IRS.

At the end of 2023, lawmakers approved in the State Budget for 2024 (OE2024) the extension of this temporary rule, allowing families, until the end of this year, to make partial or total withdrawals from their savings plans without any penalties or limits on the amount to pay housing loan installments or contributions to housing cooperatives.

With the absence of a new extension, this measure will cease to be valid in 2025. Therefore, the early redemption of PPR will again be subject to penalties, even when used to pay housing loan installments.

According to Notícias ao Minuto, Natália Nunes, coordinator of the DECO PROteste financial protection office, considered that in situations of financial difficulty, the use of the PPR should be allowed to avoid defaults. However, she emphasized that the main purpose of these products is to create savings for retirement, an increasingly urgent need in the face of significantly reduced future pensions perspectives.

On the other hand, regarding the extension, in 2024, of the exemption of bank fees for early repayments in variable rate mortgage contracts, Natália Nunes praised the measure, although she criticized its temporariness. She argued that this exemption should be permanent, allowing consumers to repay loans at any time without additional costs. Nevertheless, she considered it positive that the measure is extended for another year.

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