French Property Exhibition: Your Frequently Asked Questions, Answered

We loved meeting our clients and fellow French property experts at the French Property Exhibition on the last weekend of January.

It was really great meeting face to face and talking everything French property, as well as explaining the importance of foreign exchange within the overseas property purchase process.

We answered a lot of your questions over the weekend and for those who we didn’t get to speak to, here are a few of those answered for you.

Why use a foreign exchange specialist rather than my bank?

For those who are not often exposed to foreign exchange, using your bank may seem to be the only available option when it comes to exchanging currency.

However, a foreign exchange specialists exists solely to support with the exchange of currencies, meaning they have more accessibility to provide competitive rates and currency tools to manage their client’s payments. Many will also not charge you any additional fees for using their services nor will you incur international payment fees.

Furthermore, high street banks aren’t usually offering clients guidance on how or when to exchange their funds. And as we know timing is key when dealing with exchange rates.

I use another currency broker, Why Moneycorp?

By using a currency broker you are heading in the right direction, and many offer good services for the smaller exchanges. However, when it comes to larger transactions, and in particular property purchases, Moneycorp offers that edge that you need. Unlike many currency brokers, Moneycorp offers every customer a dedicated currency specialists, at no extra cost, who will provide a bespoke service to fit your requirements and deadlines. They will also offer many currency tools that most currency brokers and the bank may not offer. These are useful tools such as forward contracts –allowing you to lock a rate in advance- or market orders –which give you the chance to target a preferred rate.

What are the advantages of locking the exchange rate in advance?

With a foreign exchange company like Moneycorp you can lock the rate in exchange of a payment via a forward contract. This currency tool is very popular among those looking to buy a property abroad. There are two main reasons why you would lock the rate ahead of completion of the property:

1) To take advantage of an exchange rate movement

Or/and

2) To remove the risk of negative fluctuations and have the certainty of knowing how much are you paying for your property. This is especially important if your budget is very tight or you can afford a change on the rate.

Another advantage is the fact that you are able to use this tool even if the funds you want to use for the transaction are not yet available to you. However you will need to bear in mind that to lock the rate you will need to deposit a percentage of the full amount you intend to lock –up to 10%. This is not a fee, but will secure your payment which will require you to pay the remaining 90% on the day of completion.

We are buying in France as a holiday home and so will need to pay off the mortgage each month. Therefore we will need to make regular monthly payments in euros. Is this something you can help with?

If you have regular payments in between the two countries, there are different ways to structure these depending on your circumstances.

You could set a regular payment plan with a foreign exchange company like Moneycorp. The main advantage of this is to automate the payments and remove the hassle of organising a transaction every month. Moneycorp will collect the payment via direct debit and send it automatically to your bank account of choice in France.

Moreover, if you wish to have certainty over your monthly outgoings/ incomings, you can decide to fix the rate on your regular payment plan for up to 24 months. This will give you the certainty of knowing how many euros you will receive every month.

Alternatively, you can manage your payments via our online platform, or get some guidance from our dealers on the best time to exchange the funds.

Do I need to have an offer accepted before opening an account with you?

No, there are no pre-requisites for opening an account.

In fact, from our experience we have found that it is most beneficial if you are in contact with a market specialist as early in the process as possible. Getting familiar with the rates and your options in the early stages will help you setting up your budget and if you find a property you can use the guidance from your dealer to define a suitable budget range for you, as well as manage the best way to pay the deposit and any further payments involved. Not only this, but our services are completely free of charge and carry no obligation. So if you change your mind we can close the account with no hassle or cost.