If you’re buying a property abroad to emigrate to with the help of a locally-based mortgage, you may think the pressure of currency exchange is off you. But this couldn’t be further from the truth.
Article written by The Overseas Guides Company
Of course there is the deposit on the property, which you will need to pay to take the property off market and ensure it is yours to complete on. This is generally anywhere between 20 and 40 per cent of the purchase price, so unless you have that readily in a foreign bank account, you will need to transfer the money from your UK account.
Secondly is the ongoing mortgage repayments. Generally made monthly but also possibly quarterly, repayments are generally made from money earned in your new home country – unless you have income from a separate source such as rent from a UK-based property that can be used to cover the mortgage on your foreign property.
There is also a little thought-of aspect where transferring currency may be beneficial, and potentially arise at short notice. If the Sterling drops significantly against your home country’s currency, you may stand to gain handsomely by buying out the UK mortgage using local funds or a local mortgage.
For example, a £100,000 mortgage in the UK may have topped up your 50 per cent deposit on a property in the USA. If the Sterling drops substantially from when you took out the mortgage, you may find that mortgage is worth only 30 per cent of the value of your property – meaning to buy it out would substantially boost your stake in the property.
In all of these scenarios, a currency specialist like Smart Currency Exchange can help you save money. They continuously monitor all of the major exchange rates, and can inform you if they hit a certain rate at which you would be happy to trade. They offer exchange rates in the region of 2 to 4 per cent better than the major banks, and charge no fees on large transfers.
For more information on any aspect of how Smart Currency Exchange could save you money on all your currency transfers, visit the Currency Zone or download Smart’s free report.
The views and comments herein are those of the author and do not necessarily reflect the views or opinions of Rightmove Overseas, Rightmove Group Ltd or Rightmove Plc