Hidden charges

As for sending funds over then I've opened a € account with CAM, just waiting for their mortgage decision now.

I'll fund that account every 3 to 6 months using a transfer via Moneycorp.

Monthly small transfers will just cost more in poorer exchange rate/fees etc.

Again, the 1st year will be suck it and see, after 12mths we'll all be a bit wiser and everyone has to choose how they do this to suit themselves and their circumstances, nothing i say on here is a recommendation, just an explanation of why i am doing what i'm doing

I'm a Commercial Banker btw, but pick up the personal stuff just coz it's always around me.

One bit of advice on cash............... if the commercial exchange rate is 1.25/1.26 (Bank sells/Bank buys) then the cash exchange rate will be 1.20/1.30 (maybe worse if no commission). I always travel with minimal cash but take 1 debit card, 1 visa card and 1 mastercard, and advise all 3 of where i am going. Credit cards pay for any bills and debit card for cash withdrawals (always take out £200 worth minimum). Reason being that whilst you pay fees to do it the exchange rate is close to commercial rate.

 

Hi Shampers

I am glad you have brought up the issue of transferring funds and getting smaller amounts of money whilst in Spain.

I use Nationwide Debit Card to withdraw cash from Bank ATM,s and Nationwide Credit Card for goods, both of which I pay no commission and charges on and get all but the commercial rate of the day, (you just have to follow some simple rules).

For transferring large funds I have set up a Euro accounts with Nationwide International, which will allow me to convert Pounds to Euros in an off shore account (Isle of Man) again with no charges and commercial rate of the day funds credited.

I will then use these funds to fund my account with the bank I use in Spain, this bit of the exercise not researched as yet as I haven’t decided where my Mortgage is going to be so don’t know if this bank will charge to receive funds (Euro cheque, Chaps or Standing order).

Anyway just though I would mention these as may be worth people looking into.

Regards

Phil

Post Office offering similar on their Credit Card.

Rule of thumb is, if it's fee/commisison free then you will lose a bit on the exchange rate - good for smaller purchases.

Vice versa, sometimes worth paying a bit of a fee to get the better exchange rate.

Commercial Bank rates are normally abysmal for Joe Public, i work for one, but couldn't get close to Moneycorp rates when i was doing my 1st 2 deposits.

Nationwide always sounds a great offer, but i've never run a rule over it to see where the catch is - there must be one !

 

Hi Shampers

I have looked closely at Nationwide and have used it for years and they give as good as the banks if not better as far as I can see but as you say run a rule over it to see. I often look at my statement at the rate given for Credit and Debit transactions and what the commercial rate was on the same day and they are always all but the same.

As far as large money transfers go they do better than Moneycorp or at least that was the case when I last compared it Nov 07, Moneycorp wouldn’t believe me when I contacted them to obtain offer from them and asked me for the details which I gave them, but you have to already have set up the accounts which takes weeks to do unlike Moneycorp just a day or so.

Regards

Phil

Thanks everyone for providing me with lots of info to consider.  I suppose the next thing I need to look into is all of the arrangment fees for sorting out a Euro mortgage.

Cheers

Simon

Another option worth considering is to open sterling savings and current accounts in both Euro and Pounds with spanish bank. (Four accounts) 

Once you have a current account open, you can just open up savings account online in seconds. The interest rates for the savings accounts are comparable with UK banks. Took me about two days to open up first account and another couple of days to get my internet access.

After transferring sterling from UK to my spanish sterling current account. I then have options to move money via internet to sterling savings account (5%+) or transfer money to euro current account. The exchange rates I've receive so far are at the market / spot / indicative rate. I could also choose to transfer euros to euro savings account (3-3.5%) if I so wished. 

The big benefit is obviously that I can do everything instantly and on line and the exchange rates are slightly better than I was getting with Moneycorp HIFX etc.


Phil

Hi Phil,
We've signed up for a forward contract with HIFX which completes in October.  We are keen to transfer the money out as soon as possible in October and into a Spanish savings account that will pay some interest until it's time to pay our final installment. Is there any limit that you are aware of with the Spanish savings account & (if you don't mind me asking) which bank are you with?
Thanks 
Angela

Hi Angela,

I've gone down the builders mortgage route with CAM, so have opened all my accounts with them.  With regards interest on euro and sterling savings, you have the option online when you transfer money from current accounts to choose the period of saving. The min is usually one month, after that it 3, 6, 9 months 1 year etc. You can get to your money at any time. You do however lose interest on any money that you take out before your period of saving had completed. 

The interest rates vary depending on the length you decide to save for. 

I took the chance a while ago and bought my currency when the rates where better. At first I had a six month saving contract, but now on the run up to my July 1st complete. I take out one month savings contract at a time. I renew this each month online. Current rate 3.15%, not great but better than nothing.

Phil

Hi Shampers

I''ve been reading your posts about your monthly savings and saying that you can get up to 17 years (200 payments) before actually equalling the 6K loss in paying upfront. 
Can I ask you what about your set up costs for the mortgage? the extra costs for getting a mortgage when completing on your apartment ?(double stamp duty, double notary fees, although I do realise the 2nd notary fee does not apply if you get a builders mortgage), What will be the total cost of your mortgage up until your planned date to clear your mortgage (payments + interest + final amount) and is there a penalty for clearing your mortgage early with one lump sum.

Thanks Phil.  

We're with CajaBank at the moment but have not yet activated the account so there is nothing to stop us going with another bank if they don't offer the same options.

KRs

Angela

Hi all,
Quick note to let anyone intersted know, at present Moneycorp are dealing at 1.267.
I have just transferred money over.
Roll on August.
Davell

Hi Mike

Good points. It was a bit of an opportunity cost calculation. My cash was going to come from shares sale (my shares have halved in value in last 12mths - locked into my company, so not prepared to sell at such a loss, along with bonus due March 2009 - now completing early, so other option was additional UK mtge, but crap exchange rates and big fees now applying in UK as well, so left to the best option in my opinion of € builders mortgage)

Extra costs €1500 notary, €1,400 stamp, €600 bank fee, €500 reg fee, gestion/managements €250, solicitors €700. c€5,000 of which some would have been due anyway, certainly stamp, some notary, registration and legals so maybe extra costs of €2k to €2.5k  associated with mortgage. Early redemption fee is 0.5% during 1st 5 years and 0.25% thereafter so negligible.

Haven't done the all in cost for the life of the mortgage, but i would have had equivalent UK mortgage costs, or lost dividends/share appreciation (they can't fall further !) but I'm in a job where my salary will keep on rising quite nicely for the next 14 years, then good final salary scheme pension at 55, kids maintenance stops in 7 years time (big pay rise effectively). 

I would hope to repay the mortgage in full between years 6 and 10, and my UK mortgage between years 10 and 15.

I budgeted £25k sterling to cover all legals (inc IVA), aircon, furnishing etc. Then £600 p/m running cost for mortgage, utilities, comm charge, insurance etc (I've got all that in a personal cashflow forecast).

It's horses for courses, and I've assessed this to death following the kiboshing of my 1st choice in how to finance it.

Dave

Shampers,
Thanks for all the posts - it's really useful seeing someone else's thinking on this ! Especially someone with some understanding of all the financial jargon. Out of interest which phase of Condado are you buying on ? We're buying a Naranjos penthouse and the builders mortgage is with Banco Popular. The initial info they've sent me doesn't seem quite as flexible as your offer (although I haven't called them to discuss or negotiate).
Glad you had a good day at the cricket - I'm off to the Edgbaston one dayer on the 18th so looking forward to that.

A word of warning - when calculating costs IF you are not taking the CAM bank builders mortgage - DO NOT pay the cancellation fee that may be imposed on you for cancelling the CAM bank mortgage.  This is utter nonesense and not a fee you should pay!!!!!! 

Got the 20/20 coming up at Lancs v New Zealand as well.............. be a great night out that one.

Will be doing Edgbaston next year for The Ashes............ and Headingly plus the two 20/20 games at Lancs. Will travel back to UK for the big cricket games if i ever move to Spain.

Jardin 4, completes on 30/6 (I hope)................ could really have done with it 12 months later, but hey ho, these things happen.

As for understanding finance, if i did then perhaps i'd have got out of some of my shares quicker and into gold !.............

 

Pound strong against the euro today, I'm tempted

uk.finance.yahoo.com/q

Managed to get exchange of 1.262 today, need air conditioning and thought better to buy now rather than risk credit card exchange fee, best rate I have got recently.  Still not 1.45 when I bought originally, but don't want to think about that.

I was speaking to someone the other week on site whoe said their neighbours had done their whole exchange purchase at 1.52, 2+ years ago, how jealous are we all?

Hi Lindsey

Travelex.co.uk are offering 1.26045. They say thats a BIG HIKE oh yeah!! Is jardin 5 nice? It looked better than we thought from your photos.

Tis funny really.

A true rate should be 1:30 to 1:35, anything higher was always false as it todays rate. I stick by what i said a few months ago that the rate would stay close to 1.23 to 1.29 until after the US elections, as once they are over the Yanks will then start to push their interest rates up again (they are artificially low now) and this will entice investors back to the US$ and out of the €. This will strengthen the US/€ rate and will knock onto the €/£ rate. Will have no impact on US$/£ rate.

Now that rates are lower then technically you have a capital gain on your place as you get more pounds for your euros so its a good thing as well.............. if rates had shot to 1.70 then potentially you'd be sat on a capital loss and be more unhappy


This message was last edited by shampers on 8/9/2008.

Shampers - I don't understand that, I mean, I understand about the dollar and the U.S. election, but how is it a capital gain? I thought we weren't getting as many pounds to the euro and if the rate went up, we would be getting more?