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Money Transfers UK

Most buyers of overseas property know that they can get a better deal from a currency broker than they can from their bank – potentially saving thousands of pounds on their dream purchase. But what happens when it comes to selling up and transferring money back to the UK?

This is a question we are often asked at Currency Index. The answer is that there are a number of problems with transferring the proceeds of a property sale in a foreign currency back to sterling. Thankfully, they can all be avoided with a little research.

The first thing to note is that you should always stay in control of transactions involving your own money. That means that simply asking your foreign solicitor to send sterling back to you in the UK, or relying on an overseas bank to do the same, is not always very wise. If you do not know the exchange rate that is going to be applied to your transaction, you don’t know if it will be reasonable – and the chances are it could be an extremely expensive way of making the transfer.

By holding your sale proceeds in the local currency (eg euros or dollars), either in the country of sale or in the UK, you can decide who to use to exchange back to sterling, at what rate and at what time. Given the volatility in foreign exchange markets and the often large discrepancy between rates from different providers, this could make tens of thousands of pounds of difference.

The second tip is to plan ahead to make sure you are able to wire your money electronically. It’s no good paying your sale proceeds into a Spanish bank account, if you cannot then access them without getting on a plane to visit a branch of your Spanish bank. Make sure you leave authorisation with your solicitor or your bank, that you want to be able to instruct them to wire your money (without exchanging to sterling) either by telephone, email or fax from the UK.

Finally, check all charges which will apply to the transfer. In some countries, banks charge a fixed percentage to wire funds internationally in any currency – and that could add up to hundreds pounds worth of dollars, euros or dirhams. Often this problem can be avoided by negotiating transfer charges with your bank or lawyer in advance.

So planning is the key when you are selling your overseas property. By speaking to a reputable currency company in advance of your completion you should be able to get advice specific to the country and currency you are dealing with, as well as getting the best exchange rates available – and that could net you a good chunk of extra sterling when your money arrives safely back in your account in the UK.