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Say you want to send money to a relative in South America, or you bought a painting at an online auction hosted in Europe. International money transfers, such as international wire transfers (which SoFi does not offer at this time), can be a convenient way to move funds between different countries. These transfers are typically completed electronically, without any currency physically changing hands.

When choosing the best way to make an international money transfer, it’s important to consider cost, funding speed, and any limits that might apply to how much you can send. Learn the details here.

How Do International Money Transfers Work?

International money transfers work by allowing individuals or businesses to send funds from one country to another electronically. Rather than sending cash, a paper check, or a money order in the mail, it’s possible to transfer money from your bank account (or possibly another funding source) to someone else.

Completing an international transfer is usually a straightforward process. For the popular option of a wire transfer, as well as some other methods, you’ll usually need to have:

•   Your recipient’s name and address, and the name and address of their bank

•   An international bank account number, or IBAN for the recipient

•   A routing number for the recipient’s bank which, when it’s an international transaction, is a SWIFT or BIC code

•   Your bank account number and routing number

•   Funds to complete the transfer

Wiring money internationally from your bank account can be a safer option than mailing funds via a check, as there’s no risk of any physical currency being lost or stolen along the way. An international wire transfer can also be a faster method of sending money, depending on which type of transfer service you’re using.

International Wire Transfer Regulations

There are no rules on how much money you can send overseas via an international money transfer. While the federal government doesn’t limit how much you can send, there are financial regulations that govern when money transfers need to be reported.

•   Specifically, the Bank Secrecy Act of 1970 requires banks to report transfers in excess of $10,000 to the Financial Crimes Enforcement Network (FinCEN). That rule applies to individual and aggregate transfers occurring in the same business day. FinCEN uses reporting data to monitor for and detect potentially criminal activity, including money laundering.

(Worth noting: There are also rules to know if you’re thinking about opening a bank account in another country. If you maintain overseas bank accounts or investment accounts, you’ll need to file a Report of Foreign Bank and Financial Accounts, or FBAR, on FinCEN Form 114. This form must be submitted with your tax return each year.)

Back to the topic of outgoing money transfers: Know your rights. The Consumer Financial Protection Bureau (CFPB) enforces federal protections for money transfers. Specifically, consumers have the right to:

•   Have money delivered to the correct person or business

•   Be informed of the currency exchange rate and any fees or taxes the money transfer service will collect

•   Cancel a transfer within a certain time frame without being charged a fee

•   Report problems to the transfer service and have them investigated

These regulations are designed to prevent consumers from being charged unfair fees or otherwise being taken advantage of when sending money internationally.

Recommended: Benefits of Mobile Banking

3 Ways to Transfer Money Internationally

There are several options for completing international money transfers. Comparing the pros and cons, as well as how they work, can help you to decide which one might be right for your needs.

1. International Bank Transfer

Some banks may offer international transfers without any fees as part of their suite of mobile banking tools.

If this international bank transfer isn’t available, you might consider an international wire transfer at your bank if you have a checking account, savings account, or other bank account. You can tell the bank which account you’d like to transfer funds from, provide the recipient’s information, and the bank does the rest.

•   How long an international wire transfer takes can depend on your bank and the recipient’s bank. It may take anywhere from one to five business days, or more if you’re sending a larger amount of money.

•   Keep in mind that once you submit a wire transfer request, it’s very difficult to get the money back, so you’ll want to double-check your information beforehand.

•   There’s one thing to watch out for with bank transfers: international wire transfer fees. Banks can charge a fee to send the transfer on your behalf, which you’ll need to pay before the transfer can be completed. You could easily pay anywhere from $35 to $50 per transfer, depending on where you bank. (Some banks may offer free international wire transfers for certain types of accounts; check with your financial institution to see what may be available.)

Now you know the drill for international wire transfers, which can be a secure and reliable way to send funds overseas.

2. Money Transfer Services

Money transfer services can send funds internationally, and in some cases, they may arrive much faster than they would with a bank wire transfer.

•   There are money transfer services that allow you to send funds internationally online using your bank account number, credit card, or digital wallet. Others may have branches where you can schedule bank account or cash transfers in person.

•   When comparing money transfer services, it’s important to consider the banking fees. Fees vary depending on which country you’re sending funds to and how much you need to send. For example, Western Union currently charges $8 to send up to $1,000 from the U.S. to certain locations in Central and South America. Prices vary depending on how the funds are accessed as well, such as whether they will be deposited into a bank account or picked up at a Western Union location.

•   Also note the time required. Some transfers may take up to five business days. Other services (like Western Union’s “Money in Minutes”) promise a much faster timeline, whether within 24 hours or mere moments. Make sure you understand the details before sending funds.

•   There may also be limits on the amount you can send. If you’re trying to send larger amounts in a single transaction, you may be asked to split it up into several smaller transfers. Doing so could result in paying more fees to send money internationally.

It’s always wise to do your research before getting ready to use a money transfer service to make sure you fully understand the requirements, timing, and fees.

3. Person-to-Person Payment Apps

Person-to-person payment apps, such as PayPal, Wise, and WorldRemit, allow you to send funds from your bank account to someone else, sometimes almost instantly. To make an international money transfer via an app, you might just need to know the recipient’s email address, phone number, or bank account number.

Fees will vary. With PayPal, for instance, consider:

•   The current fee is 5% of the transaction amount for personal international transfers using a PayPal balance, up to $4.99.

•   There are other possible fees, such as a 2.9% funding fee for using different sources of funding, as well as currency conversion charges.

•   There may be limits on how much you can send in a single transaction or per day.

The recipient may have to pay a fee for instant availability of funds vs. waiting for the funds to transfer over a few days to their bank account.

Which Is the Best Method to Send Money Internationally?

There is no single best method to send money internationally, as some options might work better for some people than others.

For instance, you might choose a bank transfer if you don’t use person-to-person payment apps and you need to send a larger amount of money. Or you might head to an international money transfer service if you’re hoping to deliver funds in a shorter time frame and you want to avoid the wire transfer fee that your bank charges.

Again, the most important things to consider when choosing a money transfer option include:

•   How much it will cost you in fees

•   Where you can send money to, as some person-to-person payment apps (such as Venmo) don’t allow you to transfer funds to other countries

•   When the money you send is likely to arrive

•   What funding methods you can use (say, cash vs. a bank account)

You may also need to consider your recipient’s ability to receive funds. If they don’t have a bank account, for example, then you might need to opt for a person-to-person payment app or money transfer service that allows you to send cash so they can pick it up at a brick-and-mortar location.

Recommended: Guide to Depositing a Check

Tips on International Wire Transfers

When transferring money internationally, it helps to do your research first to choose the best way to move funds. Apart from that, consider how you might be affected by regulatory guidelines.

•   As noted, if you’re transferring more than $10,000 from your checking account to someone else’s, your bank is required to report that to the IRS and possibly other law enforcement entities. Even though you may be doing nothing wrong, sending large amounts could put you under scrutiny if your bank believes those transfers are suspicious.

•   If you’re receiving money via international wire transfer, it’s also helpful to know what you might pay. Banks charge fees to send wire transfers internationally, but they can also charge you money to receive them. A typical amount is $15. That’s something you’d like to know up front so that you’re not taken by surprise when a deposit you’re expecting ends up being less than the full amount.

Knowing these details can help you understand international wire transfers and use them effectively.

The Takeaway

If you need to make an international money transfer (or receive one), there are different ways to do it. These methods include wire transfers, money transfer services, and payment apps. Choosing the one that’s most cost-efficient and/or fastest might suit your needs best, so it’s helpful to shop around.

FAQ

What is the best way to transfer money internationally?

The best way to transfer money internationally is the one that allows you to get money where you need it to go in the way that suits you best, whether that means in the shortest time frame or while charging the lowest fees. With that in mind, the options for sending money internationally include wire transfers at a bank, money transfer services, and person-to-person payment apps.

What is the cheapest way to transfer money internationally?

The cheapest way to transfer money internationally may be a transfer directly from your bank, if your bank doesn’t charge for this feature. Otherwise, you may need to comparison-shop and see how money-transfer-service and payment-app fees stack up.

Is there a way to transfer money internationally for free?

Depending on your financial institution and the type of bank account you have, your bank may allow you to transfer money internationally for free. There are money transfer services that advertise that they allow you to send funds internationally without paying a fee. However, there may be limits on how much you can send (or the requirement that you send a large sum), the transfer may take several business days, and a bank account may be required for both the sender and the recipient.

Photo credit: iStock/xavierarnau

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

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The Saving on a Valuable Education (SAVE) program, an income-driven repayment plan for federal student loans, was launched in 2023 by the Biden Administration. However, SAVE was put on hold in the summer of 2024 because of court challenges. As of December 2024, SAVE is still frozen. This limbo is expected to continue until at least April 2025, according to the Department of Education (DOE).

All SAVE participants are in forbearance, meaning if you are enrolled in the SAVE repayment plan, you don’t have to make any payments until the courts decide the program’s future. You can still enroll in SAVE, but if your application is accepted, your account will be placed in immediate forbearance. The DOE is advising those who seek an income-driven repayment plan to either sign up for SAVE or an alternative plan.

Here’s what you need to know about the SAVE program, its history and current status, and the alternatives you can pursue to lower your payments on your federal student loans.

History of the SAVE Plan

In August 2023, President Joe Biden originally announced the creation of the SAVE plan. It was part of his effort to make student loan debt more manageable, especially for low-income borrowers. It replaced the REPAYE program.

The SAVE Plan was the most affordable repayment plan for federal student loans ever created, according to the DOE. If you were single and made less than $32,800 a year, you didn’t have to make any payments at all. (If you were part of a family of four and made less than $67,500 annually, you also didn’t have to make payments.)

For federal borrowers who were required to make payments and had only undergraduate school loans, the monthly payments could be cut in half and go to as low as 10% of discretionary income. The plan was for payments on undergraduate debt to be further lowered to 5% of income beginning in the summer of 2024. Because of the court challenge, that never happened.

For federal borrowers who had graduate school loans, their monthly payments could be 10% of their discretionary income. Also, under the SAVE Plan, those who originally took out $12,000 or less in loans were eligible for forgiveness after at least 10 years of monthly payments.

Recommended: Discretionary Income and Student Loans, and Why It Matters

Why SAVE Was Put on Hold

In June 2024, judges in Kansas and Missouri issued injunctions against the SAVE plan, arguing that the administration didn’t have the authority to forgive student debt on the scale the SAVE plan allows. Such widespread loan forgiveness could only be authorized by Congress, the lawsuits said.

At first, the injunctions halted only the part of the SAVE plan that lowered the minimum amount owed to 5% of discretionary income for qualifying borrowers. The injunction from Missouri also paused debt forgiveness for SAVE enrollees.

However, in August 2024, the 8th Circuit Court of Appeals went further and officially blocked President Biden’s administration from moving forward with lowering monthly payments and forgiving debt for long-term borrowers under SAVE.

A period of limbo for SAVE is underway. The DOE released guidance in October 2024 saying, “Borrowers in SAVE and anyone who has applied for SAVE should expect to remain in interest-free general forbearance for six more months or longer, pending further developments from the 8th Circuit Court of Appeals.” This would end the limbo in April 2025 at the earliest.

💡 Quick Tip: Enjoy no hidden fees and special member benefits when you refinance student loans with SoFi.

Do You Still Make Payments Under Your SAVE Plan?

No, if you are one of the 8 million people enrolled in SAVE, your monthly payment is in forbearance.

While in forbearance, you do not have to make monthly payments on your student loans. Interest will not accrue during this time. Borrowers, and employers on borrowers’ behalf, can make payments during the forbearance, but those payments will be applied to future bills due after the forbearance ends.

The problem with halting payments for months is that some people are trying to reach a minimum number of payments so that their student loan debt would be entirely forgiven under a program like Public Service Loan Forgiveness (PSLF). You must make 120 months’ worth of payments to qualify for PSLF loan wipeout.

According to the Federal Student Aid website, “Time spent in this general forbearance will not count for PSLF or IDR forgiveness.” The FSA also says that for those who want to keep making payments, “Borrowers can apply to enroll in a different PSLF-eligible repayment plan. We encourage borrowers to look at the specific terms of each plan to make the best choice for their individual situation.”

Other Loan Repayment Programs

Borrowers may still apply for income-driven federal loan repayment plans or loan consolidation by using the online applications linked below:

•   Income-Driven Repayment (IDR) Plan Application

•   Loan Consolidation Application

Within income-driven repayment, the options are SAVE or Income-Based Repayment (IBR).

“The terms of the SAVE Plan and other IDR plans are subject to the outcome of ongoing litigation,” according to the FSA website.

Borrowers should note that, under the court’s injunction, no new enrollments are being accepted for the Pay As Your Earn (PAYE) or Income-Contingent Repayment (ICR) Plans, with one exception: Borrowers with a consolidation loan that repaid a parent PLUS loan can continue to enroll in the ICR Plan (but not the PAYE Plan).

The Takeaway

The Saving on a Valuable Education (SAVE) program was put on hold in the summer of 2024 because of court challenges to President Biden’s loan forgiveness plan. The 8 million people enrolled in SAVE are currently in forbearance. This period of limbo is expected to last until at least April 2025. This article will be updated as the DOE releases more information about SAVE. To find more details yourself, this StudentAid page is a good place to start.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

Photo credit: iStock/Pekic

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

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One thing you should always look out for — regardless of the type of loan you’re applying for — is a loan origination fee. Many lenders charge origination fees for new loans to help cover costs on their end. What these fees are called and what they amount to, however, can vary quite a bit from lender to lender.

Knowing these things about origination fees before you settle on a lender can help you make the best borrowing decision for your financial situation.

What Is a Loan Origination Fee?

An origination fee is a cost the lender charges for a new loan. It’s a one-time expense you are generally asked to pay at the time the loan closes. The fee covers the costs the lender incurs for processing and closing the loan.

How Are Origination Fees Determined?

Loan origination fees depend on a number of factors. They include:

•   Loan type

•   Amount of loan

•   Credit score

•   Inclusion of a cosigner

•   Your financial situation, including assets, liabilities, and total income

Do I Have to Pay Origination Fees?

You don’t necessarily have to pay origination fees — while most lenders charge this fee, not all do. Additionally, origination fees may be negotiable. If you ask, a lender could simply lower the fee, or they could offer a credit to offset at least a portion of it. Or, they might agree to lower the fees if you pay a higher interest rate.

To minimize the sting of loan origination fees, research your loan options. Compare how much you’d pay overall for different loan offers, factoring in the term of the loan, the interest rate, and any fees.

One way to effectively compare and contrast different loan options is to check each loan’s annual percentage rate (APR), an important mortgage basic to understand. A loan’s APR provides a more comprehensive look at the cost you’ll incur over the life of the loan. This is because the APR factors in the fees and costs associated with the loan, in addition to the loan’s interest rate.

The Truth in Lending Act requires lenders to disclose an APR for all types of loans. Along with the APR, you’ll also see any fees that a lender may charge listed, including prepayment penalties.

How Much Are Loan Origination Fees?

How much a lender charges — and what the fee is called — varies based on the type of loan and the lender.

A traditional origination fee is usually calculated based on a percentage of the loan amount — and that percentage depends on the type of loan. For a mortgage, for instance, an origination fee is generally 0.50% to 1%. Origination fees for personal loans, on the other hand, can range from 1% to 8% of the loan amount, depending on a borrower’s credit score as well as the length, amount, and sometimes intended use of the loan.

There are a variety of other origination fees that lenders may charge, and these can be flat charges rather than percentages of loan amounts. Other fees that lenders may charge to originate a loan could be called processing, underwriting, administration, or document preparation fees.

Can Loan Origination Fees Affect Your Taxes?

Loan origination fees, categorized by the IRS as points, may be deductible as home mortgage interest. This can be the case even if the seller pays them. Borrowers who can deduct all of the interest on their mortgage may even be able to deduct all of the points, or loan origination fees, paid on their mortgage.

To claim this deduction, borrowers must meet certain conditions laid out by the IRS. They’ll then need to itemize deductions on Schedule A (Form 1040), Itemized Deductions.

The Takeaway

Loan origination fees are important to consider when shopping for a loan during the home-buying process. These fees are charged by lenders to help cover their costs of processing and closing a new loan application. While many lenders charge origination fees, not all do, and some may be willing to negotiate.

Origination fees are just one reason it’s important to shop around and compare home loans. With a SoFi Home Loan, for instance, qualified first-time homebuyers can make a down payment as low as 3%.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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