Are you planning on buying a car from overseas? Use a money transfer service to get your next set of wheels and save on fees and exchange rates
If you’re buying a car from overseas, you’ll need to find a safe and effective way of paying for it. After all, even if you’re saving money by buying a car from overseas at a cheap price, the value of any savings you are making could be greatly reduced if you use an expensive method to pay for it. Poor exchange rates and high transfer fees can eat into the amount of money you send overseas, resulting in a significant hit to your hip pocket.
With this in mind, it’s essential to compare the services offered by money transfer providers to ensure you get the best possible deal.
Compare money transfer services for buying a car from overseas
Use the table below to compare options for buying a car overseas. If you want to read more about a product or service, click 'More', or click 'Go to Site' to be securely taken to the product website so you can start a registration.
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- Buying property abroad
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The benefits of a money transfer service when buying a car overseas
If you’re transferring money overseas to buy a car, it’s entirely possible to complete the transaction through your bank. However, you’ll be better off financially if you look into the services offered by a range of dedicated money transfer providers.
These companies are able to offer much better exchange rates than banks, which can make a huge difference in the amount of cash that makes it to your destination. They also offer lower fees than banks, sometimes charging a small flat fee and other times applying a fee as a percentage of how much you are transferring. Some providers even offer a fee-free threshold when you transfer a certain amount.
In addition, these money transfer providers offer faster processing times for transfers. While it could take up to five days for your funds to arrive when you send them through your bank, many money transfer service transactions are completed within 24 hours. This can be a huge benefit when you need your funds to arrive as quickly as possible.
Case study: Money transfer service vs bank
Les wants to import a Ford Lincoln into Australia from America. To do so, he needs to transfer $40,000 overseas. In order to find the best deal available, he decides to compare the international transfer services of his bank and a dedicated money transfer provider. As you’ll see from the table below, the money transfer service offers a much quicker and cheaper option.
|‘Big four’ bank||Money transfer service|
|Transfer time||2-5 days||1 day|
|Transfer options||Online, phone, in branch||Online, phone|
|AUD $40,000 converts to||USD $32,779.50||USD $34,400|
What providers allow me to send money overseas?
All Australian banks allow you to send money overseas, including the ‘big four’ banks and a number of smaller providers. However, it’s also possible to enlist the services of a dedicated money transfer provider that specialises in conducting these sorts of transactions. While banks offer an extensive range of financial services, money transfer services are experts at sending funds abroad.
As a result, it’s often cheaper and quicker to use a money transfer service. These companies offer much better exchange rates than banks, as demonstrated in the case study above, and also typically charge lower fees. This means that more of your money makes it to your destination, rather than banks swiping off their commission while the funds are in transit.
Money transfer services also offer faster processing times than banks. This is an essential consideration when you need your funds to arrive as quickly as possible, such as if you need to lock in the purchase of a car from overseas.
What features should I compare when looking to send money overseas?
If you’re looking to buy a car from overseas using a money transfer, compare the following features of competing transfer providers:
- Exchange rates. You might be surprised to discover just how different exchange rates can be between competing providers. Look for the best rate but keep an eye out for any high fees which may be attached.
- Fees. Does your provider offer a flat fee, a fee that is a percentage of your transaction amount, or no fee at all? Also keep an eye out for companies that waive their fees when you transfer more than a minimum amount.
- Scheduled payments. If you want to transfer funds on a regular basis, look for companies that allow you to set up regular scheduled payments in advance.
- Limit orders. A limit order is when you lodge a transaction with a money transfer service, but on the proviso that your money won’t be transferred until the transaction can be completed at a specified minimum exchange rate. This lets you take advantage of prevailing conditions as the market rises and falls.
- Forward contracts. A forward contract involves locking in an exchange rate now for a transaction that will take place in the future. This feature allows flexibility when you need to transfer funds and can allow you to save a lot of money. However, not all services will offer this feature.
- Customer service. Compare each provider’s record when it comes to customer service. Do they respond to customer queries promptly and effectively? You’ll also need to consider whether online help, phone help and live chat options are available, as well as the hours when you can contact the company.
- Currencies. The currencies you wish to trade in could affect the money transfer service you choose. Every provider deals in major currencies like the US Dollar and the Euro, but many will not offer rarer currencies. This means you may have to shop around for a provider that transfers to your chosen destination.
Things to consider when buying a car from overseas
There are strict regulations you need to abide by when buying a car from overseas. One issue you will face is selecting which option to import the car to Australia under, with choices including ‘Vehicles made before 1 January 1989’, ‘Personal imports’ and ‘Cars not available in Australia’. You’ll need to take care of shipping costs and customs costs, both in your country of origin and Australia, while GST and possibly the Luxury Car Tax will also need to be considered.
If your car satisfies quarantine requirements, you’ll then have to ensure that it meets import approval conditions. This means you may have to make modifications to your vehicle, including servicing, replacing brake fluid, changing from left-hand drive to right-hand drive and more.
In a more general sense, you also have to be cautious of unscrupulous sellers when buying a car from overseas. It’s always wise to check over a car in person for any bad crash repairs, rust and other defects. This is the best way to greatly reduce your risk of being defrauded.
Frequently asked questions about using a money transfer for a car purchase
Is there any reason I should use a bank instead of a money transfer service?
Yes. In some cases, your bank may support certain currencies and transfers to countries not supported by specialist money transfer providers. Money transfer services are dedicated to the business of money transfers, so usually are able to secure better exchange rates and lower fees than banks, which don't derive most of their business from overseas transfers.
Where can I compare money transfer services?
You can compare transfer services in the table above and compare them to find one which suits you.
Can I trace my transfer?
Yes, your provider will give you a receipt number so that you can track the progress of your funds.
What else do I need to know to choose a money transfer service?
Do your research to ensure that you are dealing with a reputable provider. Investigate its customer service options, exchange rates, fees and transfer times.
If you want to buy a car from overseas using a money transfer, a dedicated money transfer service could offer the best deal for you. However, make sure to shop around and compare features to guarantee that you get value for money.