Cracking into the international property market is a daunting task. From the language barrier to the unfamiliar laws and regulations… it can all seem a little overwhelming.
It’s even more difficult when you consider the prickly landscape of foreign exchange. The problem is that most banks charge extortionate fees for transferring funds outside your home country and exchanging them for a foreign currency.
In addition to putting down an initial deposit, buyers will typically need enough cash on hand to cover appraisal fees, title transfer fees, insurance costs, and, of course, real estate agent commission fees. Depending on where you’re buying property, you may also be on the hook for further state and/or municipality fees and taxes.
All these costs are a huge burden to individual buyers and investors. With so many large-scale, individual transactions to make, currency conversion fees and exchange rate costs can quickly pile up.
Fortunately, the arrival of money transfer companies has reduced the exchange rate burden for overseas property purchases. To give you a better idea of the advantages of using a money transfer company, we’ve put together a list of the 7 best money transfer companies when buying property overseas.
What is a Money Transfer Company?
Before we launch into ranking each of these money transfer companies, we thought we’d include a brief refresher on what money transfer companies do, how they work, and why they’re outcompeting banks in the foreign exchange market.
Put simply, a money transfer company is a financial service provider that helps facilitate international money transfers. More specifically, money transfer companies act as an intermediary for currency exchange and cross-border money transfers.
So, how do money transfer companies offer such competitive foreign exchange rates?
The main reason is that they aren’t burdened with the same overheads as banks and other financial institutions. Money transfer companies don’t have a physical network of branches and aren’t required to fork out millions of dollars each year in regulatory compliance costs. These cost savings are ultimately passed down to customers in the form of low-cost money transfers.
Top 7 Money Transfer Companies for Buying International Real Estate
Moneycorp is a UK-based money transfer company that launched in 1962. Even though it’s generally regarded as a legacy money transfer company, Moneycorp has adapted well to the digital age, offering 33 supported currencies and lightning-fast cross-border transfers for both personal and business transactions.
XE is a global money transfer company headquartered in Canada and one of the largest money transfer companies on our list. Since its inception in 1993, XE has consistently ranked at or near the top of the customer satisfaction charts for money transfer companies. Prospective property buyers can choose from more than 60 currencies and send money to over 170 countries. To further sweeten the deal, XE will not charge transfer fees on these transactions.
Recently rebranded, Wise is one of the most recognizable names in the money transfer space. With a clean, intuitive online interface, Wise has positioned itself as the money transfer company of choice for business and personal transactions. Unfortunately, due to its focus on bank-to-bank transfers, Wise customers will need to account for a small transfer fee on their international transactions
An Australia-based company, OFX offers secure cross-border transfers for large, lump-sum payments. While its main services are catered towards the foreign currency trading market, OFX offers a low exchange rate margin and no fees for transfers over $10,000.
CurrencyFair is an Ireland-based money transfer company that was founded in 2009. As one of the more modern entries on this list, CurrencyFair prides itself on offering a seamless, instant money transfer experience for small and mid-size enterprises. If you’re purchasing property through a registered business or trust vehicle, CurrencyFair’s business features toolkit can help streamline your international transactions.
Similar to OFX, WorldRemit is primarily advertised as a foreign remittance company. However, the scope of transactions it offers is much broader. Thanks to its partnerships in emerging markets, WorldRemit is able to offer particularly competitive transfers if you’re looking to buy property in a developing or middle-income economy.
7. Sokin Money Transfer
A relative newcomer to the scene, Sokin Money Transfer has quickly emerged as a contender for the number one spot in the money transfer industry. As one of the most popular money transfer companies in recent memory, Sokin’s biggest advantage is simplicity. Featuring a user-friendly web and mobile platform, Sokin is the first money transfer company to offer a subscription-based account. Upon paying a monthly fee, Sokin customers can take advantage of unlimited international money transfers.
Alternative Top 10 Money Transfer Companies
The money transfer industry is growing at a fast rate. Thankfully, with between 30 and 40 large companies currently operating in the space, consumers have plenty of options to choose from. As the money transfer market continues to grow, we expect the number of money transfer companies to continue to rise.
While there are a few players that continue to stand out amongst the crowd, we recommend signing up to several different companies to see what they have to offer. In addition to sizing up their respective exchange rates and fee structures, it’s worth checking out each company to get a feel for what kind of user experience you want out of a money transfer company. For a more in-depth examination of some of these alternatives, check out this rundown on the best options by moneytransfercomparison.
Ultimately, you’ll want to go with the money transfer company that feels best suited to your needs. But remember, this is a competitive market, so you may be best served by continuing to hold accounts with multiple companies.
The Bottom Line
Money transfer companies have changed the way we send money overseas. However, not all money transfer companies are created equally. If you want to minimize conversion fees and avoid the prohibitive costs of international property purchases, due diligence is crucial.
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