Reliable, fast, cheap currency transfer to France
Usually I deal with people who have signed a compromis de vente for a property purchase in France and now have to transfer the deposit. They also have to transfer the balance of the purchase price plus notaire fees to France before the Acte Authentique is signed.
One of the things I like about selling real estate in France is how much I learn about the way things work
My learning process about currency transfers began for real when I bought my first home in southern France. I found the property I wanted and then needed to transfer money from Canada to France. Transferring money to France should be easy. It should also be reliable, efficient, fast and cheap.
In my case it was hell. It was also costly.
I spent hundreds of dollars more than I needed to because I did what everyone else does…I went to my home bank. What I learned – eventually – was what a huge mistake I had made. They didn’t understand the French forms, the customs, or any of the details of the process. I’m not sure they knew where France was actually.
The worst part was that my bank didn’t really seem to care that much.
It got done but it was a stressful experience. Time was wasted. A courier had to be paid. It was a nightmare.
I wish that I’d known about currency brokers.
I would have saved hundreds of dollars using a currency broker.
There would have been the joy of dealing with someone who actually knew what they were doing; knew the shortcuts; knew what a notaire and a compromis de vente and an Acte Authentique were. Believe me, a good foreign exchange broker can make moving money around almost a pleasure. Almost as important, they seem to genuinely like what they do.
After half a decade of buying and selling property here, my feeling is that a first class currency broker is worth his/her weight in, well, currency!
Having learned my own lesson the hard way, I now always suggest that my clients at least talk with a currency broker before they decide to use their bank to transfer the funds to France for their property purchases.
I recommend Baydonhill Foreign Exchange because my clients have always been happy with their service. A good reputation travels and they were recommended to me 4 years ago, when they were called Currencies4Less. There are other currency brokers but I’ve had no reason to try any of them.
Baydonhill is a UK based company but can transfer funds pretty much from anywhere to anywhere, converting from almost any currency to euros. The very first client I referred to them saved $6000 USD on a $130,000 USD transaction by using Baydonhill instead of using his own bank. That’s more than 4.5%. You could buy a lot of nice furniture for that. (Or wine).
Currency fluctuations, forward buying, currency futures … currency brokers save you money
They say that “money talks” but mostly it’s saying “goodbye”. A good currency trader can keep some of it around for you. They know all about stuff most of us haven’t a clue about – like currency hedging, forward-buying, where the euro is headed and what’s happening to the USD.
Other than spending it I have no idea about the mechanics of currency trading or hedging or anything remotely connected with money markets. As far as I can tell, most banks don’t know all that much either. I say this because very early in my working life I was a foreign exchange clerk in a Canadian bank. Scary thought, isn’t it?
But Currency brokers understand these things, because that’s their specialty – their stock in trade, as it were. They know what it means if U.K. sterling is strong against the euro. Or not. They know if sterling is rising and understand what that means. And can explain how it will impact your transfer and what options there are. And they can explain it in plain English.
It’s one of the ways they save us money on foreign exchange transfers. There are a couple of other ways.
- First of all…they charge a lot less than a bank does per transaction.
- Second…you get a better exchange rate and that’s because they’re doing a lot of volume.
Currency exchange rates, a moving target
Somewhere there is someone or something responsible for establishing a Base Exchange rate between two currencies. You and I will probably never know who that is, what they do or even what the rate is. I for one don’t really need to know all that. I do know that if I go into a bank in the UK with £1000 and want to buy Euros I’ll pay a high rate to make the switch.
The spread between the Base Exchange rate and the retail bank rate is like the mark-up. If I don’t spend the Euros and go back to the bank to get sterling I won’t get 1000 pounds back. The buying rate is lower than the selling rate.
Currency brokers do huge volumes of business. They’re like supermarkets; their mark-up is low but the turnover is high. Their prices are always lower.
They make their money on the spread, the difference between what they pay for the currency and what they charge you for it. Same as a bank. But they only trade currency, they don’t have to pay for real estate, bank managers and staff, ATM machines, bad loans, and all the other costs that banks have. Much lower overhead. They don’t need as large a spread in order to make a profit. They’re very competitive.
How to use a currency broker to pay for a house in France – the process
You’ve found a house that you want to buy. Your offer has been accepted, you’ve signed the compromis and now you have to transfer the deposit in Euros to the notaire’s bank account.
Contact a currency broker and open an account. You can start the process online or over the phone. You don’t have to trade immediately so you can actually open the account as soon as you start looking for French property. It’s not like a bank account; you don’t pay in the money until you’re ready to do the transfer.
The notaire will have given you a RIB (Releve d’identite Bancaire – bank account information) when you sign the compromis. You then give this information to the broker. There are various ways to send the money to be transferred to the notaire – they’ll explain all the options simply and clearly.
Once the funds have cleared your bank, your broker transfers euros to the notaire’s account. That’s it.
You then do a second transfer for the balance of the purchase price. If the euro or your currency is fluctuating, the broker will advise you on the best time to transfer so you get the best possible rate.
This post is getting far too long so I’ll talk about regular payments on another day.
You can reach Baydonhill Foreign Exchange by clicking on the link or by telephone:
From the UK: 0871 070 5555
Outside the UK: +44(0)20 7594 0594
Disclaimer: Baydonhill did not solicit or pay for this post but I am an affiliate and if you say that Sam sent you I will get a small finder’s fee. And you’ll save enough to buy something lovely for your new house in France.