Buying currency - the forgotten step that can cost a small fortune
Buying a place in France is an attractive option. The lifestyle is fantastic and property prices are relatively low. However, many people forget to consider the effect of currency fluctuations and similarly don't get their currency from the most competitively priced suppliers. The combination of these two mistakes can be costly. If you're considering a place in France and don't feel entirely confident about these issues please read on.
Q. Where should I go to sort out transferring my money to France?
You can obviously walk into any high street bank, but for larger amounts of currency it pays to get in touch with a currency broker or specialist foreign exchange dealer such as Moneycorp. Such companies will almost always offer much more competitive rates than high street banks, as well as lower fees and quicker transfer times, as their overheads are much lower. | |
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confidence (although it will be passed a specialist currency exchange
professional in order to provide you with details
of the best products and rates available). By submitting the form to us you are deemed to have
authorised any such disclosure. |
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Q. What is the minimum amount that can be transferred or bought?
The minimum amount is usually £5,000 (or currency equivalent), though smaller amounts are considered. The minimum amount for transfers made under the Regular Payment Plan offered by Moneycorp is £250 per month (see section entitled ‘What finance options currency brokers can offer’).
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Q. What will it cost me?
In general the more money you wish to convert the better the rate. Depending on your bank, there will be a cost to transfer funds of around £40 per transaction. Currency brokers such as Moneycorp charge only £15 per transaction instantly saving you £25. What is more, they do not charge any commission on your transaction. It's a good idea to compare the total cost of a currency trade as some currency dealers do not charge a transfer fee but more than make up for this difference in the exchange rate that they quote.
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Q. How do I purchase currency?
Once you have set up your account with your currency broker, you will be able to buy currency over the telephone.
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Q. Can I hold out for a particular rate?
Yes, you can instruct your broker the moment the rates change to your desired level. The broker can place an order to purchase currency outside London trading hours, which will automatically trigger as soon as your desired rate is achieved. Just make sure you are being realistic about the rate you are looking for and be prepared to wait!
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Q. What if the rate is good now, but I don't need to or can't make payment for 3 months?
You can fix an exchange rate for up to two years to make it easier to plan the cost of your currency payments. This is particularly useful if you are buying a new property ‘off plan’. With most currency brokers, forward buying your currency is very straightforward. Simply book an exchange rate and send your dealer a deposit, usually 10% of the contract value. The 90% balance of your currency contract is payable when you wish to have funds transferred overseas. (See section entitled ‘What finance options currency brokers can offer’.)
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Q. Will currency brokers or foreign exchange dealers offer advice about market conditions and rates?
Currency brokers are not regulated to give advice but many will provide you with information about prevailing market trends and currency movements. However, remember that no one can predict the markets with absolute certainty. You will have to make your own decision about when to buy currency, but market knowledge and experience imparted by your currency dealer will hopefully make that decision easier! Further information can be found at specialist dealer websites such as www.Moneycorp.com, where you can peruse the latest currency charts as well as sign up to receive daily or weekly market updates.
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Q. If I take out an Overseas Mortgage and have to make payments from the UK how can I do this?
Most currency brokers offer a service such as Moneycorp’s Regular Payment Plan to assist those clients that need to make regular overseas payments. Such payments might include overseas mortgage payments or transfers of UK pension payments or any other regular transfers.
The Regular Payment Plan allows you to fix an exchange rate on regular overseas payments for a period of between 6 and 24 months, removing the worry caused by fluctuations in the exchange rate over that period of time. The payments will usually be deducted from your account by Direct Debit each month and your funds transferred directly to the account you nominate. (See section entitled ‘What finance options currency brokers can offer’.)
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Q. How do I pay for my currency?
After booking an exchange rate, you will need to transfer funds to the currency broker. The easiest and quickest way is by CHAPS or BACS. Bear in mind that any cheque you send will have to clear before funds can be sent. Once your cleared funds have been received, your currency will be transferred to the account of your choice.
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Q. How can I find out current exchange rates?
The Interbank rate can readily be found on the Internet and on Ceefax or teletext. Many currency brokers or foreign exchange dealers such as Moneycorp have websites with live currency charts and you can also view historical exchange rates. Although a useful guide to current market levels, do bear in mind that unless you are trading millions of pounds on a regular basis, you will not receive the Interbank rate for your own transaction! For a live quote on the amount you are looking to exchange, it is best to call your dealer.
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Q. How long will my funds take to transfer to an overseas bank account?
Brokers often use Electronic Funds Transfer and can generally get the funds into the destination account a good deal quicker than a high street bank, usually within the same day to France. Bear in mind that there is sometimes a short delay at the receiving bank before your account is credited, this can usually be overcome with a ‘proof of payment’ document that your broker can provide on request.
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Q. How do I contact Moneycorp?
Want to save time and money? Open an account now with this link:
Or get one of the Moneycorp team to phone you (saving you the price of the call). Just click on the phone icon, type in your telephone number and someone will call you straight back...
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