How to get a great deal on foreign exchange when you buy a Portuguese home

If you’re planning on buying a second home in Portugal, then getting a good deal on foreign exchange probably isn’t the top thing on your list of priorities.

You might be more interested in, for example, making sure you choose the right second home, or finding a good local school for the kids, or learning the language.

In spite of this though, making sure you get the best rate when changing currencies is a crucial part of the process.
banana split
To miss it is a little like making a banana split without the banana, or going to Australia and not seeing any kangaroos.

So how do you do it? How do you emerge from the foreign exchange jungle feeling like a hero, instead of, well, a disappointing sounding integer?

Beware! Beware the high street banks!

Perhaps the number one piece of advice I can offer you is to be cautious about using a high street bank.

People tend to trust their banks – they handle the rest of their financial dealings, after all – and so go to them as a matter of course when changing currencies.

In truth though, using a bank to change currencies is a little like asking your accountant to fix your plumbing.

Banks offer second-rate rates (!) and service that, compared to what’s out there, is just not up to snuff, old bean.

For instance, finding a bank that’ll keep you updated on the rates is about as likely as stumbling on an oasis in Death Valley. It ain’t gonna happen.

Instead then, a good bet to get a good rate is to get in touch with a specialist foreign exchange broker.

Me? Biased?

Of course, I can hear you saying to yourself at this point, “Of course you’re going to say that! You work for one!”

And while that is true (and I quite like where I work), foreign exchange brokers genuinely provide both superior rates and better service than high street banks.

For instance, on a standard exchange of more than five thousand pounds, using a broker means you can save up to 5.0% compared to your bank.

On a large exchange into euros, perhaps to buy a Portuguese home like you might be considering if you’re reading this, that then could add up to thousands.

Not bad, right?

To be more economical, you need first class service

In terms of service meanwhile, using a bank might be compared to flying coach on a long trip to New Zealand. Using a broker meanwhile, business class.

(That means on-flight meals that don’t taste like plastic, and all the leg room you could want.)

For instance, brokers can remove the burden of having to watch the exchange rates.

Speak to a broker, and you can arrange for them to get in touch once your target rate arrives, for the same price as the air we breathe.

What’s more, brokers can talk you through the options regarding your transfer, including locking in the exchange rate (use the forward contract, Luke!) and setting up regular payments on a mortgage.

Never before has a boy wanted more

That then should be enough to set you on the right road, to get a great foreign exchange deal when you buy a Portuguese home!

by Peter Lavelle