Moneycorp – foreign exchange specialists
Buying a home overseas can be a very exciting time. But it can also be worrying and an expensive process. To help you through this process – and help make your money go further, Moneycorp, the UK’s leading foreign exchange company, offers the following advice:
1. Do your research. Even before you start looking for property abroad, it is advisable to see your lawyer first. There are a number of preliminary issues that can best be discussed in the relative calm before you find the house of your dreams. These include, ownership of the property, mortgage finance and structuring the purchase to minimise taxes and costs.
2. Choose a reputable estate agent. Unlike England, estate agents in most continental countries must be professionally qualified and hold a licence to practice. Check that the estate agent has the required paperwork to verify its licence. This will ensure that you are covered by the legislation and codes of conduct to which the agent must adhere as well as by any insurance and bond.
3. Just as you would do in the UK, make sure you obtain a survey or have the property inspected before you enter into a purchase agreement.
4. Research your mortgage requirements and the options available to you thoroughly. Weigh up the pros and cons of having a mortgage by a UK lender versus one with by a local bank or lender near to the property you are purchasing.
5. When buying a property abroad you will inevitably need to transfer a Sterling sum of money into a foreign account to pay for your property. Exchange rates change constantly and fluctuations in excess of 10% can occur, even over a short space of time. This means that costs can change significantly, especially for purchases that take time to complete, such as the purchase of property. A specialist currency dealer will normally offer you a better rate of exchange than that of a high street bank. It can also offer a range of services that will help protect you from adverse currency movements.
6. Beware – if you ask your bank to transfer the money you should expect them to charge you for doing so. The local bank may also make a substantial charge for receiving the money. A reputable currency trader may well be able to reduce those overseas charges substantially by sending the money via a cheaper route.
7. Use a currency dealer to your advantage. At Moneycorp, we offer a very proactive and personalised service to our clients, using our expertise to monitor exchange rates on their behalf to help achieve the best possible rate of exchange.
8. You can agree to buy your foreign exchange currency for delivery within a period of anything up to two years and fix the exchange rate at the time of the agreement. This is called ‘forward buying’ and it will help you secure an exchange rate at an advantageous level, removing the risk of adverse currency movements that could lead to the Sterling value of your overseas property increasing between the time of signing and the contract and actual payment.
9. If you need to make regular overseas payments, such as mortgage repayments, you should speak to a currency dealer about setting up a payment plan. This will remove the worry caused by exchange rate fluctuations when making currency payments and the transfer fees will only be at a fraction of the cost charged by your bank.
10. Knowledge is power. Every world currency has its own personality, so it is beneficial to understand the factors that could influence a currency fluctuation during the period that you intend to transfer funds. Your awareness of the currency market, coupled with the expertise of your currency trader, will help you decide the most advantageous time to make a transfer and to help your money further.