The Currency Conundrum

So you decided to buy a condo in Brazil. Everything is set. The purchase agreement is signed and now it’s time to send the funds to the seller. But wait...the purchase price is in local currency and your bank can only send US dollars. Now what?

It happens all the time. At the last minute, American buyers realize there’s an issue because they don’t know how much money to transfer. The conversion you do today when you send the funds won’t be the same when the money arrives a day or two later.

If you send too much money, you can be sure you’ll never get it back. But if you send too little, the seller might not sign over the deed. On top of it all, there are fees for international wire transfers, such as intermediary bank charges. Who’s responsible for paying those?

We say it all the time, but it’s worth repeating yet again. You must plan ahead and document all of these details in your written purchase agreement. Think through all of the things that could happen. For example, what if the seller’s bank won’t accept dollars? Or what if you miss the payment deadline because the wire transfer got delayed?

There really aren’t any easy answers. You’ll be hard pressed to find an escrow service as you might in the US to help facilitate the transaction. Just ensure that you’ve protected yourself contractually in case the deal doesn’t go as smoothly as you first imagined.