The Key to Purchasing Power: Currency Transfer

The Key to Purchasing Power: Currency Transfer

When buying a property in Israel, it is crucial to determine the method of transferring funds.

There are a few options available:

Firstly, your attorney can establish an escrow account, and you can transfer the funds from your American bank account directly to the escrow account. The conversion of currency can be done by either your American or Israeli bank.

Secondly, if you already possess an Israeli bank account, you may choose to transfer the funds directly to it. However, setting up an account can be a time-consuming process, especially without a mortgage.

Lastly, you can opt for a licensed currency transfer expert, who will transfer your funds at a highly competitive rate.

Currency Transfer Companies

During my recent travels to America, I had the pleasure of presenting alongside Daniel Eisenberg from Isratransfer. As we conversed, Daniel highlighted an essential point regarding American banks' currency conversion rates, which typically range from 2.5-3%.

He emphasized that the crucial factor is not the fee to transfer funds but the exchange rate. Conversely, Isratransfer charges around 0.5%, depending on the transfer amount.

Moreover, Daniel stressed that Isratransfer can pay the shovarim - "voucher books" when purchasing in new construction. It is crucial to ensure that when deciding to move your money you have a way to facilitate such payments if you intend to buy new construction property. 

When selecting a currency transfer company, it is essential to seek personal references from your lawyer and referrals.

Currency can significantly influence a real estate transaction since exchange rates can fluctuate substantially and impact your purchasing power. It is critical to receive proper advice when converting funds.

Additionally, note that however you move your money you will be subject to money laundering regulations and the process of clearing your funds.

Thus, utilizing a currency transfer company can significantly assist you in navigating this process. To contact Daniel for more information regarding currency transfer, reach out to deisenberg@isratransfer.com. 

Top Tips For Currency Transfer

To ensure that you are aware of the actual cost of your purchase, monitor exchange rates on reputable websites like XE.com or Bloomberg, as the final price will be in NIS, not USD.

It is advisable not to delay until the last minute since Israeli banks have regulatory requirements that necessitate the collection of paperwork, which can be time-consuming to compile.

Exchange your dollars when exchange rates are favorable rather than only when a payment is due. Ask if your transfer company can hold your funds in NIS until the next payment.

To avoid the hassle of establishing a bank account to coordinate payments to the seller/developer and vendors, make sure whichever company you work with can make all necessary large payments.

Conclusion

Knowing how to transfer your funds is crucial, whether it's through banks, your lawyer's escrow account, or a currency transfer company.

When beginning the purchasing process, it's important to consider the money transfer process as it can be tedious and pressuring if arranging is rushed at the last minute.

Always make sure you understand and make an informed decision on how to move your money, and take advice from your lawyer.

(This article is not data-based but rather based on CapitIL’s CEO & Co-Founder Ben Levene’s personal market experience and opinions. No decisions should be made without thorough due diligence and professional financial advice.)

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