Are you considering buying a property abroad? Purchasing real estate overseas can make for a valuable investment. You may need a Power of Attorney, for someone who can act on your behalf for all your monetary transactions. Here is an article with more information on the Power of Attorney.
However, it is essential that you understand your options for transferring money internationally before making the commitment. This information will help you choose the best way to remit a large amount of money for purchasing property overseas like buying a house or home, investing in land or property. Read more on how the NRI remittances will be affected by the recent changes in the Indian budget
Bank or Foreign Exchange Broker?
Go to your bank first. Although your best option for sending large amount of money overseas is through a foreign exchange broker, ask you bank for a quote first. This will give you a benchmark when searching for better exchange rates later on. Certain banks do offer competitive rates and services for overseas bank transfer, especially for larger amounts.
Use a foreign exchange (Forex) brokers like World First, Venstar Exchange, USForex Money Transfer. Unlike banks, Forex brokers often have lower exchange fees and better exchange rates. Some of the other benefits that may be offered include no hidden charges or fees, and potential savings of up to 2-3% on average. Choosing the right provider depends on the amount you want to remit, type of transaction you would like to make and time taken.
Finding the Best Exchange Rate
Be sure to select the money transfer provider with the best exchange rate, even if it surpasses another’s by only a small amount. When transferring funds for overseas property that amount to US$100,000 or more, an exchange rate that varies by only a small portion can make a huge difference in the sum that is ultimately received. Don’t make the mistake of losing money that you could have saved with a better exchange rate.
Also, many foreign exchange companies give you the option of choosing locked-in vs indicative exchange rates. Locked-in Exchange Rates are recommended for higher transactions, since the amount that will be received is known and guaranteed.
Recurring Payments for Mortgage
Many people set up recurring accounts with money transfer companies in order pay their mortgage for overseas properties. It is recommended not to set up recurring payments, since you will be bound to the exchange rate provided by that provider. Exchange rates fluctuate from company to company, and there may be a better exchange rate provided by another company that can be favorable, so you don’t want to miss an opportunity to get a better value for your currency sent overseas. We understand that people set up recurring transfers to save time and hate hopping from one site to another. Now, on CompareRemit, you have that single platform to make an informed decision to find the best way to send money abroad.
Transfer Large Amounts Once
Consider transferring larger amounts at once rather than smaller amounts often. Reason, the more amount of money you send, the better exchange rate, the remittance company will give you. Additionally, if you send over a certain amount, the transfer fees may be waived. To learn more about the different way to send large amount of money, go to our article Best Way to Send Large Amount of Money.
Ask your bank or money transfer provider about any possible fees or charges that may apply to your transaction. There also may be tax implications involved in the transaction as well. These costs may apply:
Look out for transfer charges and overseas bank receiving fees.
If you are an NRI and wish to send money to India for purchasing property, you can send up to US$14,000 per person per year tax-free. For any amount that exceeds this limit, U.S. taxes will apply. Apart from this, there is no limit on the amount of money that can be sent abroad from the U.S. If you have paid the tax on the money you are sending, you do not need to pay tax again in India (according to Double Taxation Treaty between U.S & India). The recipient will be liable for paying taxes on the money received as income.
With any significant investment, be sure to do your research. Before purchasing property overseas and transferring a large sum of money internationally, research the market in which you looking to purchase real estate and research your money transfer options. Being smart about transferring money abroad will get you the best value for your dollar, and ultimately, a higher return on your investment.