If you are Canadian and considering purchasing real estate in the US, you should love this chart:
That would be a graphic representation of the value of the Loonie compared to the US Dollar. The more the line goes up, the more buying power in the U.S. you have. Right now, exchange rates are near historic highs (well, at least since the 1950s, which is as far back as I’ve been able to find on the Internet)
If you are a Canadian buyer of US real estate, at some point you are going to have to convert your hard-earned Canadian dollars into US dollars.
To exchange money, there are several options. You can go to your bank. You could in theory, do it with a credit card (you’ll need quite a credit limit to purchase a home ”“ and the interest rate would suck), I suppose you could also turn to the black market, though I can’t recommend it.
A bank is the first (and often only) option most people consider. Yes, it’s safe, and you’ll likely get a reasonable exchange rate.
But banks are not in the business of exchanging foreign currency. Banks make their living by lending money.
Why not exchange your currency using the services of a company that makes their living by exchanging currency?
Enter the “foreign currency exchange broker”. These types of companies do little more than exchange various currencies. As such, they tend to get very good exchange rates. 2 ”“ 4% better than banks in fact.
EDITED TO CLARIFY – whoops, I’ve been told that the currency broker doesn’t really get better rates than the banks, but that banks typically “mark up” the rates — ie: charge a premium — and the currency broker does not.
“2 ”“ 4%, big deal”, you might be saying.
Well, when you’re talking tens to hundreds of thousands of dollars required to purchase real estate, it IS a big deal!
Here’s an actual example a currency broker emailed me on May 9:
As an example, based on rates at this very moment, on a $300K USD home:
– going through Bank of Montreal or TD Canada Trust, it will cost you $311,400.00 CAD (based on 0.9620 US)
– going through Globex, it will only cost you $305,400.00 CAD (based on 0.9820
This is a savings of $6,000.00 CAD.
Over the past several months, I’ve received numerous calls from currency brokers. To be perfectly honest, some seemed a little shady, and many were far too “hard sell” for my taste.
But Globex Foreign Exchange, based in Edmonton, Alberta was different. I like their attitude, and I like their customer service based philosophy. None of our Canadian clients have used their services, yet, but we are going to be providing them with the contact info for a Globex “Private Client Specialist” and suggesting they contact her. It certainly can’t hurt to explore this option. I’ve done my due diligence and feel comfortable recommending our clients contact Globex.
Globex does not make their money on commissions and fees. They make their money on the natural buy/sell spread in exchange rates. They trade money all day, every day, and pass their great rates on to people like you and me. They’ve been in business for 10 years and all client funds are guaranteed and insured for up to $2 million.
Since I didn’t ask her permission, I don’t want to post the specific contact info I have for the Globex rep for all the world to see. But I’ll gladly pass it on to anyone who would like it.
EDITED TO ADD: Permission granted! See contact info at the bottom of the post… She’s willing to talk to anyone, even if you’re just curious about how the process works. Be nice!
If you are a Canadian buyer, you should call these folks ”” even if you aren’t our client (though really, what were you thinking? )
If you are an agent working with Canadian buyers, you should call these folks. I’m telling you, they will not hassle you for referrals, but they’ll help you understand what they can do for your clients.
For the record, I’ve got no affiliation with Globex, nor am I compensated in any fashion for suggesting people call them. As I stated, I simply like the way they approach business, and if I can save my Canadian clients a little money, that’s a great thing”¦
If you’ve ever used Globex (or any currency broker) I’d love to hear about your experience.
Globex Contact Info: