Buying a property in Italy, if you are outside the Euro zone, means you’ll need to send euros to Italy, not only to pay for your new home there, but also to cover ongoing running costs, such as utility bills. When you begin your hunt for an Italian property, all your money is likely to be in your local currency, for example UK pounds, so at some point you’ll likely need to exchange your funds into Euros and have them transferred to a Euro account in Italy.
You have two main options for managing your money. You can ask your local bank to arrange your Euro transfers, or send money through a specialist currency firm, which could be a cheaper option in many cases.
Photo from archer10(Dennis)
Probably you will know better the first way, which is the most traditional one. But what are currency specialists exactly? And why they could be better for transfers?
• They usually offer exchange rates that are 2-4 per cent better than the rate your bank would typically offer you. If so, for a British buyer for example this could mean a saving of around £2,000 by using such companies instead of a bank to transfer €100,000 to an Italian bank account. The benefits work the other way too, so when you are exchanging euros into another currency for repatriating to your native country.
• Currency specialists also could save clients money by charging no commission, or only applying it to lower value transfers, and often by absorbing banks’ sending and receiving charges. They could also complement their competitive exchange rates with one-to-one customer service, a fast transfer time and clever ways of helping you to secure the best exchange rates.
• They will buy euros, or other currency, on the spot for you, but one of the most useful ways they can assist property-buyers is with a forward contract. By paying a small deposit, a forward contract allows you to secure an exchange rate for a future transfer, typically made within a year. It’s a very useful way of helping you to budget when buying a home in Italy – once you have had an offer accepted on a property, forward buying euros to pay for it means the cost to you in your local currency, e.g. UK pounds, won’t change with the exchange rate fluctuation before you come to complete.
• Currency specialists can also help clients who make regular transfers between Italy and another country, whether its transferring a pension to Italy, or sending money to Italy to cover bills.
• As a final benefit, using a regulated currency specialist could be as safe as using your bank to send money to Italy. UK currency firms are classed as Payment Institutions and must be either registered or authorised by the Financial Conduct Authority (FCA).
In any case, Gate-Away.com recommends that you inform yourself in advance about rates applied and services provided by currency specialists and banks so you can choose the option that best suits your needs.
Featured image by archer10(Dennis)