I would give a FOREX if I were you!

You have gone through the labourious process of getting your mortgage sorted out, finding the property, getting tax advice, buying your home contents cover and putting some loan cover in place for good measure. Now it is just a case of sending the money over and it will be happy days for all concerned. However, it is when you are on the home straight that you take your guard down in the property buying world which could be a costly result.

Had you sent £500k to Dirhams recently as opposed to this time last year, you would be ~£30k better off. If you want to know more about saving a bundle when buying property and the importance of FOREX then read on …

Most folks instruct their bank to send money to various parts of the world whether it is for property purchase or similar goods and services. When you pay for such items in the same currency then you do not expose yourself to the fluctuations and vagaries of the currency markets. However, once you have to move into another currency, you are now at the mercy of the exchange rates which may or may not be in your favour.

There are two ways to handle this problem. Instruct your bank to send the money when you say and hope that they give you a good rate coupled with some TT fees for good measure. Conversely, you could employ the services of the wholesale currency trader who can advise when the best time to send your money will be, not charge you any fees for sending it and ultimately beat your bank on the exchange rate they offer. Banks rely on the fact that most folk sending money will rarely ask for a better exchange rate, challenge another bank for a more competitive quote or indeed ask for the TT fees to be waived. Evidently, this is a very profitable business for Banks and it is only the astute investors who seek the services of a currency expert.

You only have to look at your Credit Card statements to see what poor exchange rates you get for foreign exchange transactions (plus there is interest on top too!). Banks will offer wider spreads on exchange rates if you do not barter them down. In my experience, a whole sale currency trader will beat a bank every time - and save you a lot of money.

But why bother about foreign exchange you ask? For example, if you had spent £500,000 on property in Dubai, when exchanging your Sterling into Dirham you would have been Dhs 162,500 better off had you sent it on 19 August 2006 and not exactly a year before. Not an insignificant sum I am sure you agree and a good currency wholesaler will be worth every penny. But there is another point with mentioning, they do not cost you anything. Money leaves your bank account in the same currency and is sent to your wholesale currency trader's account. Depending on how you wish to make your payment, they will do the rest.

When buying currency there are a number of options available to you:

Spot transaction
With a 'spot' transaction the currency is bought outright on the day. The rate is fixed and the full amount must be paid in full within two working days.

Forward transactions
Forward transactions give you the ability to fix a rate up to 18 months in advance. There are two options available:

Fixed Forward
A fixed forward is, as the name implies, fixed to a set date in the future. If you know in advance the maturity date and the amount you need to pay, this is a good option for you.

Time Option
A time option works in much the same way as a fixed forward with the added benefit that you are able to take delivery of your currency up to 90 days prior to the maturity date.

An added advantage of forwards is that you only have to pay a 5-20% deposit to secure the rate. The deposit is due within two working days of fixing the rate and is held in a trust account with a holding bank. With a fixed forward the balance is due on the date of maturity, and within the 90 day window up to the maturity date for time options.

Limit order
A limit order enables you to place an order in the market to specify a desired rate of exchange. If the market reaches this level we will automatically activate your order. You can also set a lower limit to protect yourself against market movements. Limit orders are good until cancelled.

So, by using wholesale currency traders for your international transactions you will receive...
Superior rates of exchange
Transfer of funds to international destinations within 48 hours
Assignment of a personal currency broker
Notification of significant changes in currency rates
Forward buying which guarantees a fixed rate from 3 days to 18 months
Regular payments made at commercial rates rather than tourist rates
Confirmation when funds have been sent
In order to save yourself a bundle when sending money around the world particularly for property purchase since the sums are generally larger, get yourself a currency trader for FOREX sake.