Frequently Ask Questions
I notice that the ‘broker rates’ are far superior to those displayed from the High Street Banks – why is this?
Simply put, it is because a broker is a specialist and they will be dealing in bulk. The foreign exchange market is like most others in the sense that buying in volume leads to a reduction in cost. Brokers are also buying straight from the live foreign exchange market and because they are working from a live rate rather than one set at the start/end of the trading day it gives them the flexibility to get that better rate when they see it for their client.
I am looking to buy a property overseas, but have a strict budget. I need a specific set rate to make any purchase possible, but the rate hasn’t met my target yet. Is it possible to set up an order where I can wait for the rate I need?
Yes, if you know what rate you need to achieve to make your purchase possible, a currency broker can set up a ‘limit order’. If the rate reaches your target at any time, the rate will be automatically fixed for you. You will be informed by your broker that the order has been filled and how to arrange the payment.
With the property market as it is I am struggling to sell my property, but the rate is very favourable if I sell my Euros now. Is there any way I can fix the rate now for when my property is sold?
If you want to take advantage of the current rate, but don’t have the all the funds ready to exchange, you can fix the rate now on a ‘forward contract’. By doing so the full balance does not have to be paid for up to 18 months, so you can set the sale price of your property in both currencies.
I am looking at moving to France and several friends have recommended I use a currency broker. However, my main concern is the safety of my money. What guarantees do brokers provide? I would feel much safer using my bank.
All reputable currency brokers take security of Client’s funds very seriously, and will have strict procedures in place as well as using a reputable clearing bank to hold your funds. Find out what bank they use and what type of accounts your funds will be held in. Segregated Client accounts will assure that your funds are held separately from the companies’ accounts. Ask as many questions as you need to feel that your funds are going to be safe.
I have to send a payment every month for my mortgage in Spain. I use my bank at the moment and I find that the organisation of it all is a bit unclear and I have to set each transaction up separately at the start of the month. Can you help?
Due to currency fluctuations you will find when paying a regular fixed sum in a foreign currency, the amount you pay in sterling changes each time when using your bank. A currency broker can fix a rate for 12 months therefore fixing the amount you will need to pay in sterling for each payment.
I heard some foreign banks will charge for paying money in, is this true?
Yes, some banks will charge you for paying money in to your designated receiving account. Some banks will only charge you a small flat fee and some will charge a percent of the amount paid in. However, the majority of European banks are now part of the Single European Payment Area – SEPA. If the bank you are sending the funds to is part of SEPA and you transfer any amount below €50,000 by a standard transfer no charges will be taken by either banks.
How much can I expect to save with a Currency Broker, compared to using my bank?
You can expect to save anywhere up to 6% when you use a Currency Broker rather than a High Street Bank.
How long will it take to get an account set up and start trading?
A Currency Broker should be able to get an account open for you within a couple of hours. Once your account is in place the speed of the transaction will depend on how quickly you can get the funds to the broker to purchase the currency you require.