Moving hundreds of thousands of dollars across a border to close on a house is a compliance exercise as much as a banking one. To transfer money to buy property overseas, you gather exact recipient banking details, choose between a commercial bank wire and a foreign exchange broker based on the true cost of currency conversion, verify every instruction by voice to defeat wire fraud, let your bank file the automatic reports the Bank Secrecy Act requires, screen the seller against OFAC sanctions, and plan for the foreign-account and foreign-gift filings that will follow you into next tax season.
What to Collect Before You Send Anything
Most of the numbers you need come from the foreign notary, attorney, or escrow agent handling the closing. You need the beneficiary’s full legal name and address exactly as they appear on the receiving bank’s records, the name and branch of the receiving bank, the SWIFT/BIC code that identifies that bank in the international network, and the IBAN, which can run up to 34 characters in Europe, the Middle East, and many other regions.
Many foreign banks also require a Purpose of Payment code that tells their local regulators the money is a capital investment for a property purchase rather than a commercial payment or a gift. Ask the seller’s bank or attorney which code applies.
One wrong character in a SWIFT code or IBAN can drop your funds into a suspense account and cost you weeks and reclamation fees. Confirm every field directly with the seller’s bank or closing attorney by phone. Email alone is not enough, for reasons that become clear below.
Bank Wire or Foreign Exchange Broker
The single choice that most affects how much money reaches the closing table is who handles the currency conversion.
Your Commercial Bank
Sending from your existing checking or savings account is the simplest route. You initiate the wire online or at a branch. The catch is the exchange rate. Banks typically mark up the mid-market rate — the midpoint between buy and sell prices for a currency pair — by 1% to 5% depending on the currency and the amount. On a $300,000 purchase, a 2% markup is $6,000 hidden inside the rate, on top of a flat outgoing international wire fee that generally runs $30 to $65 at major banks, sometimes more for foreign-currency or branch-initiated wires.
Foreign Exchange Brokers
FX brokers specialize in currency conversion and international settlement, and their spreads are often well under 1%. You send domestic funds to the broker by local wire, and the broker pays the seller’s account in the foreign currency. That extra step can save thousands on a large purchase.
Brokers also offer tools a bank wire does not. A spot contract converts and sends at the current market rate for near-immediate delivery. A forward contract locks in today’s rate for a future closing date, protecting your purchase price from currency swings between now and settlement; forwards typically require a deposit of 5% to 10% of the contract value, applied to the final payment at maturity. A limit order lets you set a target rate and executes automatically if the market hits it before your deadline.
Who Pays the Intermediary Banks
Every international wire carries a fee instruction code that decides who absorbs the charges deducted by correspondent banks along the payment chain. Under OUR, you pay all fees and the recipient receives the full amount. Under SHA, you pay your sending bank’s fee and the recipient covers intermediary and receiving-bank charges. Under BEN, the recipient pays everything, and multiple deductions come out of the transfer before it arrives.
For a real estate closing, OUR is almost always the right choice, because it avoids a dispute with the seller over a shortfall in the received amount. Check whether your purchase contract already specifies a code.
How to Avoid Losing the Money to Wire Fraud
Real estate wire fraud is the single most likely way this money disappears. The FBI’s Internet Crime Complaint Center reported more than $173 million in losses from real estate fraud in 2024, with business email compromise schemes across all industries accounting for $2.77 billion.1IC3. 2024 IC3 Annual Report The pattern is consistent: criminals compromise a real estate agent’s, attorney’s, or title company’s email account, watch the transaction, then send fraudulent wiring instructions just before closing from an address that looks nearly identical to the legitimate one.2IC3. Business Email Compromise – The $50 Billion Scam
Three habits cut the risk sharply:
- Verify wiring instructions by phone using a number you already have on file, not one printed in the email itself. Do this even if the email looks perfectly normal.
- Treat any last-minute change in receiving account, bank, or payment method as suspicious until confirmed through a separate channel. That change is the hallmark of a compromised email thread.
- Send a small test wire first if the timeline allows, and confirm arrival in the correct account before sending the full purchase price.
If you suspect funds went to a fraudulent account, call your bank immediately to request a recall and file a complaint at ic3.gov. Speed matters. Banks can sometimes freeze funds if they act quickly enough.
Federal Compliance on the Way Out
The $10,000 Reporting Threshold
Any transfer over $10,000 triggers a Currency Transaction Report that your bank files with the Financial Crimes Enforcement Network under the Bank Secrecy Act.3FinCEN. The Bank Secrecy Act This is automatic. You do nothing beyond completing the wire.
Do not try to duck the threshold by splitting one large transfer into several smaller ones. Federal law makes it a crime to structure transactions to evade reporting, and structuring can be prosecuted even when the underlying money is entirely legitimate.4Office of the Law Revision Counsel. 31 USC 5324 – Structuring Transactions to Evade Reporting Requirement Prohibited Bank compliance teams are trained to spot just-under-threshold patterns, and a structuring flag causes far more trouble than a routine CTR.
Source of Funds
Anti-money-laundering rules require your bank to verify where the money came from. Expect requests for recent bank statements, tax returns, or documentation of a prior asset sale. Answering quickly keeps the wire on schedule. Willful failures to comply with reporting requirements can carry civil penalties up to the greater of $100,000 or $25,000 per violation, with separate penalties for foreign-account reporting failures.5Office of the Law Revision Counsel. 31 USC 5321 – Civil Penalties
OFAC Sanctions Screening
Before sending funds abroad, you are legally required to make sure the recipient is not on the Treasury Department’s Specially Designated Nationals and Blocked Persons list. Search the seller’s name, any associated entities, and the receiving bank in OFAC’s free database.6U.S. Department of the Treasury. Sanctions List Search Your bank will screen too, but running your own check is cheap protection.
OFAC rules apply to all U.S. persons regardless of where the transaction takes place. Civil penalties can reach $250,000 per transaction or twice the transaction amount, whichever is greater.7FFIEC. BSA/AML Manual – Office of Foreign Assets Control If the seller, the seller’s company, or the country appears on any sanctions list, stop and consult a sanctions attorney before doing anything else.
Executing and Tracking the Wire
You can start the wire through your bank’s online platform or at a branch. Online transfers use multi-factor authentication; branch transfers require a signed wire authorization form. If you need same-day settlement on the domestic leg, submit well before your bank’s cutoff. The Federal Reserve’s Fedwire system, which handles that leg for many international transfers, stops accepting third-party transfers at 6:45 p.m. ET on business days.8Federal Reserve Board. Fedwire Funds Services – Data and Additional Information
After processing, your bank issues an MT103 confirmation, the standardized SWIFT payment message that acts as your receipt. It contains a Unique End-to-End Transaction Reference, or UETR, that follows the payment through every bank in the chain.9Swift. What Is a Unique End-to-End Transaction Reference (UETR)? Keep the MT103. If the seller reports a delay, giving that document to their bank helps locate the funds.
International wires typically settle in one to five business days, depending on time zones, currency pair, and the number of correspondent banks involved. If funds have not arrived within the expected window, ask your sending bank to trace the payment using the UETR.
Tax Filings the Purchase Triggers
Buying property abroad often creates new annual filings even in years when you owe no additional tax. Missed deadlines carry stiff penalties on their own.
FBAR (FinCEN Form 114)
If the combined value of all your foreign financial accounts, including any account opened to facilitate the property purchase, exceeds $10,000 at any point during the calendar year, you must file a Report of Foreign Bank and Financial Accounts.10Internal Revenue Service. Report of Foreign Bank and Financial Accounts (FBAR) FBAR is filed electronically with FinCEN, not the IRS, through the BSA E-Filing System. The deadline is April 15, with an automatic extension to October 15 that requires no separate request.11FinCEN. Due Date for FBARs The non-willful penalty is up to $16,536 per report in 2026, and willful violations carry penalties up to the greater of $100,000 or 50% of the account balance at the time of the violation.5Office of the Law Revision Counsel. 31 USC 5321 – Civil Penalties
Form 8938 (FATCA)
Separately from the FBAR, the Foreign Account Tax Compliance Act requires Form 8938 with your income tax return when foreign financial assets exceed certain thresholds. For taxpayers living in the United States, the thresholds are:12Internal Revenue Service. Do I Need to File Form 8938, Statement of Specified Foreign Financial Assets
- Single or married filing separately: more than $50,000 on the last day of the tax year, or more than $75,000 at any time during the year.
- Married filing jointly: more than $100,000 on the last day of the tax year, or more than $150,000 at any time during the year.
Taxpayers living outside the United States face higher thresholds: $200,000/$300,000 for single filers and $400,000/$600,000 for joint filers.13Internal Revenue Service. Comparison of Form 8938 and FBAR Requirements Form 8938 goes to the IRS with your return; FBAR goes to FinCEN. You may have to file both.
Form 3520 and Form 926
If a foreign individual or estate contributes more than $100,000 toward your purchase in a tax year, such as a gift from a family member abroad, report it on Form 3520.14Internal Revenue Service. Large Gifts or Bequests From Foreign Persons The threshold is lower for gifts from foreign corporations or partnerships and adjusts annually; it was $20,116 for 2025. Each gift over $5,000 must be separately identified.
If you buy through a foreign corporation and transfer more than $100,000 in cash to it, or acquire at least 10% ownership, you must also file Form 926 with your income tax return.15Internal Revenue Service. Instructions for Form 926 Both forms carry substantial late-filing penalties, so bring a tax professional in early if a foreign entity or a foreign gift is part of the deal.