The Advantage of Using a Currency Specialist Over a Bank

With 75% of the private client currency market being made up of property buyers, currency specialist have extensive experience in this field, supporting expats and holiday home buyers throughout their purchase.

A currency specialist will assess your situation, timeframe and budget to help plan your upcoming payments and give you complete transparency over the market and how it is behaving. The bank will not give you this expertise and will simply facilitate your payment from one account to another when asked.

With currency being their sole business, specialist companies have the accessibility to a panel of liquidity providers, offering them very competitive rates of exchange. This therefore allows them to offer their customers a very attractive rate of exchange. So regardless of where the market, most currency companies will save you money in comparison with a bank.

Either on the phone or online, most currency specialist companies are more accessible than banks when booking an international payment. Even more, they are often supported by faster and more transparent processes.

It is a good idea to choose a company that is able to assist you over the phone. This is quite reassuring when you need to check bank details or are concern about a payment.

By using your bank you often only have one way to buy your currency –a spot contract. Furthermore some high street banks don’t provide live rates and often you are given the ”rate of the day” which sometimes mean you cannot take advantage of any positive fluctuation that might happen through the day.

Some of the main currency tools and contracts available through a foreign exchange company are:

Spot Contracts

A spot contract is the current market price for changing one currency directly for another for immediate delivery, as opposed to a date in the future. This is the best way to seize the opportunity when exchange rates swing in your favour and your transfer will be made immediately.

With a currency specialist, you have access to more tools that the bank will not offer you that are beneficial when buying property abroad. You might not be able to control the exchange rates but these tools will help you plan ahead, remove risk and maximise your budget. Below are some of the options a currency specialist will provide you with which you may not receive through your bank.

Forward Contracts

Forward contracts allow you to take advantage of a favourable exchange by fixing the exchange rate for a date in the future. Once you agree a rate of exchange, you can lock this in for up to a two year period. Whenever you wish to transfer the funds, whether you have a completion date on property in a few months’ time, your transfer will be made with the fixed rate you had agreed originally, regardless of the current rate. A forward contract also doesn’t require you to make the payment in full, you will only need to provide a 10% deposit to lock in the rate.

This is a popular choice for property buyers as it fixes your budget and removes the risk of fluctuating exchange rates affecting your budget. This is very beneficial for those working towards a budget, however, bear in mind you will not be able to take advantage of an improved rate.

Rate Tracking and Market Orders

If you have a more flexible timeline or budget, you can set up a market order to track a rate. You decide the exchange rate you would be happy with and when the rate is reached, your funds will be automatically purchased for you. You can also set a stop limit order, preventing you from moving out of budget if the exchange rate is to fall below a certain point, again transferring your funds automatically.

Regular Payment Plans

Regular payment plans are ideal if you have monthly bills or mortgage repayments to pay, or are receiving income or a pension from overseas. Making automatic transfers takes all the hassle out of making payments and there are also options to fix the exchange rate for extra security over the payment amounts.