Large transfer from family overseas

JWalterWeatherman

Hi there,

We're currently in the process of buying a house, and the deposit is a large gift (£250k) from my father-in-law in the USA - essentially an advance on her inheritance.

We're aware of all the source of funds checks that need doing by our solicitor, mortgage broker and mortgage lender - all fine, the money is legit and we can prove that. One thing we hadn't really thought about was moving the money across from his US bank account to our UK joint current account.

I know receiving large amounts from overseas can trigger certain checks, though I assume my father-in-law's bank will also be running their own checks. Is there anything we can do to make sure the process is smooth? Any risks, like accounts being frozen while checks are made?

tacpot12

There is always the risk of the account being frozen while checks are made. Having another bank account available would be sensible if there is time to open one. 

Telling your bank about the payment, the source of funds and the intended purpose is probably a good idea. 

JWalterWeatherman

Thanks, I'll definitely be speaking to them.

One other issue that has come up - my father-in-law's bank uses the worst possible exchange rate when they do a wire transfer. But my bank says that if they receive a transfer in a foreign currency, they do the conversion, and their exchange rate looks like it's much better.

Should it be possible to do the wire transfer but have it sent in dollars, and just have my bank do the conversion, so we get the better rate?

artyboy

JWalterWeatherman said:

Thanks, I'll definitely be speaking to them.

One other issue that has come up - my father-in-law's bank uses the worst possible exchange rate when they do a wire transfer. But my bank says that if they receive a transfer in a foreign currency, they do the conversion, and their exchange rate looks like it's much better.

Should it be possible to do the wire transfer but have it sent in dollars, and just have my bank do the conversion, so we get the better rate?

Why on earth would you do a straight bank to bank transfer and conversion when there are plenty of FX exchange companies that will give you a far better rate - as in one that is near perfect to interbank rates?

If your family won't go down that route then maybe open a basic USD currency account (I think HSBC offer one) here for the money to go in then you can arrange it yourself.

grumbler

artyboy said:

JWalterWeatherman said:

Thanks, I'll definitely be speaking to them.

One other issue that has come up - my father-in-law's bank uses the worst possible exchange rate when they do a wire transfer. But my bank says that if they receive a transfer in a foreign currency, they do the conversion, and their exchange rate looks like it's much better.

Should it be possible to do the wire transfer but have it sent in dollars, and just have my bank do the conversion, so we get the better rate?

maybe open a basic USD currency account (I think HSBC offer one) here for the money to go in then you can arrange it yourself.

I don't think that USD transfers are free in UK.

Marchitiello

grumbler said:

artyboy said:

JWalterWeatherman said:

Thanks, I'll definitely be speaking to them.

One other issue that has come up - my father-in-law's bank uses the worst possible exchange rate when they do a wire transfer. But my bank says that if they receive a transfer in a foreign currency, they do the conversion, and their exchange rate looks like it's much better.

Should it be possible to do the wire transfer but have it sent in dollars, and just have my bank do the conversion, so we get the better rate?

maybe open a basic USD currency account (I think HSBC offer one) here for the money to go in then you can arrange it yourself.

I don't think that USD transfers are free in UK.

It is true that in theory HSBC  Currency Account has a charge for income USD payment but someone on here (HSBC Global Money Thread) actually reported that he has never been charged.

in any case, even the HSBC Currency Account  has terrible exchange rates and fee, however there is a strategy to get great rates via HSBC:

Open a standard HSBC UK GBP account, and then add to it a Global Money Account and USD Currency Account (This is necessary because Global Money (from now GM) cannot yet receive money from third parties in other currencies, can only send them out). At this stage also do a simple test run, which someone reported to be actually a requirement to get the full benefit of the Global Money exchange rate, and transfer £10-20 into your GM GBP pot. From here initiate an exchange from GBP into USD and this will create an existing balance into a GM USD pot (I have not personally had to do this as I already had balances into the GM pots but someone in the dedicated thread says it is a pre-requisite to be able to transfer same currency from Currency Account into GM account).

once you have this set up, you ask to get paid into the USD Currency Account. Once you did that, from your Mobile App Pay & Transfer Section, under the Global Money section, you select “Add, Convert and Withdraw”. Next screen you will select the “From” source as the USD Currency Account, and in the next “To” screen, the Global Money Currency USD pot. Than, the following screen you type the amount in “you send”, and the “you receive” should show you exactly the same amount… after you have the money into the GM account, you can do the exchange at GM superior rates.


Good Luck 

PS. Even if there is a fee to get paid in USD into HSBC UK USD Currency account, that is likely to be a one off £25 or something like that, and over £250k, it is likely that it will still be better than getting paid, converting and paying out via an external Forex service (even wise fee would be higher than that and in the test comparison net exchange rate was better with HSBC GM)