Paying a deposit on a property abroad

A property deposit is the one transfer where being late can cost you the property.

Sellers don’t wait. Contracts name dates. And the money has to arrive in the right account, in the right currency, with paperwork that makes sense to two banks and a lawyer. Here’s how to handle each piece without drama.

Two payments, not one

Most purchases abroad have at least two money moments, and people mix them up.

First comes a small reservation payment. It takes the property off the market while the lawyers work. The second is the deposit or down payment, usually a bigger slice of the price, due when you sign a contract. Then comes the balance at completion.

Names change by country. The mechanics don’t. Before you send anything, get three answers in writing: how much, by what date, and whether it comes back if the deal collapses. “Refundable” isn’t a feeling. It’s a clause. Read it. If you can’t tell what it says, a local property lawyer is cheaper than a lost deposit.

Work backwards from the deadline

Start with the date the seller needs the money in their account. Not the date you press send. Then subtract.

Transfers can take several business days. Holidays, time zones and compliance reviews add more. One large provider’s own advice on down payments says to send early enough that funds arrive well before the scheduled date. That’s the whole principle. Then pad it: weekends and bank holidays in both countries, not just yours; a first large transfer with a new provider, which tends to get reviewed; and one spare day for the mistake. There is always a mistake.

Leave a full week if it’s your first time and a few days if you’ve done it before. Our guide on how long transfers take explains why the clock is slower than the app suggests.

Proof of funds: two different meanings

Two different things hide behind this phrase, and sellers and banks each want one of them.

Before the offer. A seller, agent or developer may want evidence you can actually pay. That is usually a recent bank or brokerage statement, or a letter from your bank confirming the balance. It shows you have the money. It doesn’t move it.

At the transfer. Your bank or transfer provider checks where the money came from. In the UK, the Money Laundering Regulations 2017 expect firms to monitor transactions and check the source of funds where necessary. No two firms trigger on the same number, but a property deposit is exactly the kind of one-off payment that gets a look. Providers commonly ask for something like payslips (one currency firm’s guidance lists these examples; requirements differ) and savings statements, a property sale completion statement, an inheritance letter, or a signed gift letter plus the donor’s evidence. Documents in another language may need a certified translation.

Gather both sets before you make an offer. Our large-transfer guide goes deeper on checks and negotiating the margin, so it isn’t repeated here.

Where the currency risk lands

This is the part that surprises people. The deposit is only the first chunk. The balance can be months away, and if the price is set in the seller’s currency, you carry the exchange-rate risk on every instalment.

Take an illustrative case. A made-up buyer, Dana, agrees to buy a flat priced at 250,000 EUR. She holds US dollars. The deposit is 10%, so 25,000 EUR. At a made-up rate of 1.08 USD per EUR, that costs her 27,000 USD. The balance is 225,000 EUR, which at the same rate would be 243,000 USD.

Now suppose the euro strengthens to 1.12 by completion. The balance costs 252,000 USD. That’s 9,000 USD more for exactly the same flat. Move the other way, to 1.04, and she saves 9,000 USD. Same flat, same contract, and a swing of 18,000 USD between the two outcomes, which nobody in the deal controls.

All illustrative. You can watch where a pair is today on USD to EUR, with rates refreshed hourly (or scan the grid), but a chart can’t tell you where it goes next. Nobody can.

What can you do? Decide how much risk you can stomach, then pick one of these:

1. Convert the whole balance early, if you have the cash, and accept that you’ve fixed the rate for good, better or worse.
2. Book a forward contract with a currency provider for the completion date. It fixes the rate but binds you to settle, and a deposit is usually part of it.
3. Convert in stages, so one bad day doesn’t decide everything.
4. Do nothing, and budget a cushion in case the rate goes against you.

Option four is a legitimate choice. Option four with no cushion is a gamble. If a mortgage is involved, ask the lender how a currency move affects what they’ll lend you.

Make sure the whole amount lands

Say the contract wants 25,000 EUR. Then 24,970 EUR isn’t it. Intermediary banks sometimes take a cut along the way, and the receiving bank may charge as well. Ask your provider if you can cover all fees yourself so the full figure arrives. Our guide to intermediary bank fees explains how it works. If the sum arrives short, get the shortfall topped up immediately. A late or incomplete deposit can breach the contract.

Pay in the currency the contract names. If you pay in your own currency and let someone else convert, you can hand them the exchange margin.

Be paranoid about the account details

Property payments attract fraud because the sums are big and the deadlines are tight. The US Consumer Financial Protection Bureau describes the pattern in plain terms: scammers pose as your agent, lawyer or settlement agent, often through spoofed or hacked email, and send a last-minute change to the wiring instructions. Its advice is simple. Before wiring, phone someone you trust, using a number you already had, and confirm the account name and number. Don’t act on emailed changes.

That rule works anywhere in the world. Do this every time:

• Get the account details from the contract or the lawyer’s office, in person or by phone.
• Check the account name matches the party you’re paying: seller, lawyer or escrow agent.
• Treat any change of details, even from a familiar email address, as a red flag until you’ve called.
• Keep the transfer confirmation, the rate and the reference number.

Caught anyway? Then contact your bank or provider at once and ask for a recall, and report it to the police or fraud service. Speed matters. Recovery is never guaranteed. More in our scam guide.

Ask where the deposit will sit

A deposit paid straight to a seller or developer is only as safe as that person. Some places regulate this. Dubai, for example, has a law (Law No. 8 of 2007) requiring buyers’ off-plan payments to go into a project escrow account with an accredited escrow agent, kept separate from the developer’s other money. That’s a Dubai rule for off-plan sales. Other countries run on different systems, with lawyers, notaries or agents holding the deposit. So ask the plain question: who holds my money until completion, and what protects it?

Vague answer? Treat it as the answer.

Nothing here is legal, tax or financial advice. Property law, deposit rules and taxes differ by country and change. Check with a local lawyer, your bank and a tax adviser before you commit.

Sources

• Sending a Home Down Payment Abroad: What Buyers Need to Know (Remitly)
• Buying a home? Watch out for mortgage closing scams (CFPB)
• Money Laundering Regulations 2017, regulation 28 (legislation.gov.uk)
• Proof of funds for large international transfers (Cambridge Currencies)
• Law No. (8) of 2007 concerning escrow accounts for real estate development in Dubai
• Currency forward contract (OFX)

Checked: November 2026