Foreign currency transfers

What are we talking about when transferring a property price?

Two operations almost always conflated, though their costs and risks differ: converting a currency into euros, and moving euros to the notary's account. The first carries the exchange risk and most of the cost, the second is only a transfer.

This separation has an immediate practical consequence: you can convert early and transfer late. Many buyers do the opposite, holding their currency until the last day and converting in a hurry, at whatever rate applies. That is the one moment when you have no bargaining power at all.

A useful and often ignored point: a transfer denominated in euros between two accounts inside the European Economic Area cannot be charged more than a domestic transfer, under European regulation 924/2009. The extra cost, where it exists, therefore lies not in the transfer but in the conversion, and that is exactly where to look.

How does a transfer unfold, from contract to deed?

In four stages, the first of which comes well before any money moves: opening the account that will receive the euros and the provider who will do the conversion. Opening each takes days, sometimes weeks, and nothing can happen until they exist.

1. Before the preliminary contract: open the French account and the account with an authorised currency provider, both in your name, and complete identity verification with each.
2. On signing the contract: decide the currency strategy, immediate conversion, staged conversion or forward contract, and put it in place the same day.
3. During the investigation: gather the source-of-funds evidence the notary will ask for, and send it without waiting to be chased.
4. A few days before the deed: transfer the euros to the practice's account, from an account in your name, with a reference that clearly identifies the transaction.

The important words in the fourth stage are "a few days before". Funds must have arrived and been verified on the practice's account at the time of signature, not be in transit: a transfer sent the day before is not enough, and a deed is not signed on a promise of payment. Three to five business days ahead is the practice.

Who can be trusted with a conversion, and under what authorisation?

To a bank or an authorised payment institution, and the second category deserves understanding rather than suspicion: a payment institution is authorised by a national supervisor under the second European payment services directive, and it operates across the Union by passporting. This is not an informal intermediary.

Segregation is the central guarantee and the only one to verify: article L522-17 of the Monetary and Financial Code requires a payment institution to hold client funds on an account separate from its own. Your euros therefore do not mix with the company's cash, and do not share its fate in difficulty. An authorisation is checked in a minute on the supervisor's public register.

Where does the real cost of a transfer hide?

In the rate, almost always, which is why a commission announced at zero says nothing about the price paid. The cost of a conversion is the gap between the interbank rate, public and viewable at any moment, and the rate applied to you. That gap is a margin, it appears on no line, and on a property price it weighs more than all the fixed fees combined.

How to compare two offers fits in one sentence, and it does not mention fees: ask each how many euros you will receive exactly, for a given amount in your currency, at a given hour. That single figure contains everything, margin included. Comparing fee schedules leads nowhere; comparing two net euro amounts settles it.

What lead times should you plan for, and which is underestimated?

The transfer itself is fast, often one business day inside the euro area. What takes time is what comes before: opening the accounts and completing identity verification with each provider, counted in days and sometimes weeks for a file from far away.

The costliest delay is none of these: it is the one you impose on yourself by waiting until the last moment to convert. Between contract and deed the rate has had two to four months to move, and a conversion done the day before signature happens at that day's rate, with no alternative. The question of the currency timetable is settled on the day of the contract, not on the day of the deed.

What do your currency and your country change about the operation?

Two things, and the second surprises more than the first. The currency decides liquidity and therefore the margin: a heavily traded currency converts at a narrow spread, a thinly traded one mechanically costs more. The country decides the length of the checks and sometimes the very existence of exchange controls at home.

The last line is checked very early, because it does not depend on French law and no European provider will lift it for you: if your country subjects outward capital movements to authorisation, that authorisation conditions the purchase itself and obtaining it can take months. It is started before the contract, never after.

What should be checked before launching a large transfer?

Five points, four of which take minutes to check and only one requires some preparation. None concerns the rate: that is compared at the moment of the operation, not when choosing the provider.

The fourth line deserves one gesture and one only: never take bank details from an email, however perfectly written, without confirming them by phone on a number you dialled yourself. Fraud on transfers of notarial funds is documented, it targets foreign buyers precisely, and money gone does not come back.

What risks weigh on a transfer of this size?

Three, of very different magnitudes. Currency risk is certain in its existence and uncertain in its direction: it is managed. Blocking risk is frequent and is prevented. Fraud risk is rare and irreversible, and it is the only one with no recovery.

A fourth risk is not one but presents itself as such: the temptation to speculate on the rate. Waiting for a better rate to convert amounts to taking a market position with the money of a purchase already committed, on a timetable that is not yours. That is not prudence, it is the opposite, and the only neutral position is to lock the rate as soon as the price is known.

How do you read a rate, and how do you compare two offers?

With one single question, asked to both providers in the same minute: how many euros will I receive exactly for this amount in my currency? Everything else is decoration. A rate cannot be compared with another rate quoted at another hour, and a fee schedule says nothing about what will land on the account.

• The interbank rate is public and viewable at any moment: it is the benchmark, and no individual obtains it.
• The gap between that rate and the one applied to you is the margin, expressed in percentage points: it is the real price.
• A margin is negotiable on large amounts, and a property price is a large amount: ask explicitly.
• A commission advertised at zero indicates nothing until the margin is known, and it is sometimes dearer than a displayed commission.
• Always compare at the same instant: fifteen minutes apart is enough to make two quotes incomparable.

On a six-figure sum, a few tenths of a point of margin represent several thousand euros, more than all the fixed fees of the whole operation, notarial transfer included. That is why this section exists: it is the one place in the purchase where an hour's attention pays at that level.

Should you lock your rate in advance, and how?

Yes in almost every case, and for a reason unrelated to any market forecast: you have a firm commitment in euros and resources in another currency. That gap is a currency position you carry without having chosen it, and hedging does not seek to win, it seeks to remove it.

A forward contract binds you: if the sale does not go through, you remain bound to buy the euros at the agreed rate, and you will sell them back at the prevailing rate, at a gain or a loss. Good practice is therefore to align the contract's maturity with the deed's deadline, and to hedge only the amount actually due, never more.

Why does the notary want to know the source of your funds?

Because the law requires it, not out of curiosity: article L561-2 of the Monetary and Financial Code subjects the notary to anti-money-laundering vigilance duties. They cannot receive a deed if they do not understand where the money comes from, and that requirement has nothing to do with the trust they place in you.

One practical rule beats any explanation: the funds must leave an account in YOUR name. A transfer sent by a parent, by a company you own or from a joint account you do not hold suspends the signature, even when everything is perfectly legitimate. If a third party funds the purchase, that is prepared by a deed of gift or loan, upstream, and never by an improvised transfer the day before.

Which mistakes cost the most on a transfer?

Only one, in five guises: having looked at the fees and not at the rate. The four others follow from it, and the sixth is of another nature, since it is irreversible.

The seventh mistake looks like wisdom and is not: deciding to wait for a better rate. You have a firm euro commitment and a deadline; waiting amounts to speculating with the money of a purchase already signed, on a calendar imposed by others. Locking the rate as soon as the price is known is not a bet, it is the only choice that is not one.

What does French Realty do on your transfers, and what does it not do?

It places the currency milestones on the acquisition calendar, directs you to authorised providers and prepares with you the evidence the notary will ask for. This is calendar and file work, not financial work.

• The calendar: when to open the accounts, when to decide the currency strategy, when to transfer so the funds are there in time.
• The direction: authorised institutions, verifiable on the supervisor's public register, never an unlicensed intermediary.
• The file: the list of source-of-funds evidence the notary expects, gathered upstream and not under the pressure of the deed date.
• The coordination: exchanges between you, the currency provider, the bank and the practice, so that account details are confirmed by voice.

What it does not do, and the line here is regulatory: French Realty is neither a payment institution nor a financial intermediary. It holds no funds, executes no conversion, recommends no investment and offers no opinion on where a currency is heading. The choice of a currency strategy is yours, informed by the authorised provider who will execute it.