Mortgages in Brazil: SFH, SBPE, TR and Using Your FGTS

Brazilian mortgages work differently from their U.S. or European counterparts: rates are quoted monthly, funding lines have legal ceilings, a mostly-dormant index called the TR can move your balance, and a compulsory employer fund — the FGTS — can quietly become your biggest home-buying asset.

The two funding lines

SFH loans draw on savings-account deposits and carry a legal rate ceiling (historically ~12% a year plus TR). They finance properties up to a regulated value cap and are the gateway to FGTS usage and to Minha Casa Minha Vida, the federal subsidy program for lower-income families, which can combine below-market rates with direct down-payment subsidies.

SBPE loans are funded by the banks themselves. No rate ceiling, no value cap — this is the line for higher-value properties. Rates float with the bank’s cost of funds, so when the Selic is high, SBPE credit is expensive and volumes fall.

What the TR actually does

Most contracts index the outstanding balance to the TR (Taxa Referencial) plus a fixed spread. The TR spent years pinned near zero and many borrowers forgot it existed — but it rises with the Selic, meaning both your balance and your installment can drift upward even on a “fixed-rate” contract. Read the indexer clause before signing; some SBPE contracts now offer IPCA-linked or truly fixed structures instead.

FGTS: the sleeper advantage

Every formal worker accumulates 8% of salary monthly in an FGTS account. Eligible buyers can deploy it three ways:

1. Down payment — often the difference between renting and owning.
2. Amortizing principal — cutting the balance (and total interest) directly.
3. Paying up to 80% of installments for 12 months — a cash-flow bridge.

Amortizing principal under SAC compounds hardest: every FGTS real applied early saves multiples in interest over a 20–30 year contract.

Price vs SAC

	SAC	Price
Installments	Start high, fall monthly	Constant
Total interest	Lower	Higher
Approval test	First (highest) installment	Flat installment
Best for	Buyers with headroom now	Buyers needing predictable cash flow

Banks typically cap the first installment at 30% of gross household income — which is why some borrowers approved for Price are declined for SAC on the same property.

Who this is NOT for

• Anyone without a stable income and an emergency fund. Brazilian mortgage rates plus TR make falling behind expensive fast.
• Anyone eligible for Minha Casa Minha Vida who hasn’t checked it. The subsidy bands change; verify current income brackets before assuming you don’t qualify.

Bottom line

Default to SFH if your property fits the cap — the rate ceiling and FGTS access are structural advantages. Choose SAC when you can absorb the initial installments, use every FGTS real against principal, and read the TR clause like it matters, because when the Selic rises, it does.