Lending to a family member in the USA

Archergirl

Not sure where to put this........We are going to lend a family member in the USA £20k, we can afford it and she needs a new roof, she was going to get a loan but we offered so she would save on interest.
We have accounts with Nationwide, Halifax, HSBC and Paypal. 
What would be the cheapest way to send her the money? (she has a bank account) I know people use Western Union I have seen them in the post office but I have no knowledge of it.
Please move if this is the wrong place x

Herzlos

You should be able to just transfer from your bank to hers, though you may need an IBAN (International Bank Account Number). One of the banks will charge for the currency conversion though.

Exodi

I'd personally use Wise, as you can save a decent chunk of change compared to high street banks.

Archergirl

Exodi said:

I'd personally use Wise, as you can save a decent chunk of change compared to high street banks.

I have not heard of this, how would I do it please,is it safe? 
Halifax would charge £9.50 but sending 20K USD would cost me £16572.75
Wise would charge me £70.06 but it will only cost me £16,092.55 if I have looked it up correctly.

CliveOfIndia

Have you looked at the other banks you have accounts with as well?  Pretty much all banks (as well as the specialist service providers) will be able to transfer money abroad, obviously it's easier if you already have an account with them.  But it's always going to be a balancing act between the fee they charge and the exchange rate they use.  It may, for instance, be worth paying a higher fee if you get a better exchange rate - for the sum you're talking about, a small difference in the exchange rate can make a fairly noticeable difference in the overall "cost".

As an aside, there is the age-old discussion to be had about lending money to friends and family....  But I'm sure this is something you've already considered and are comfortable with.

Archergirl

CliveOfIndia said:

Have you looked at the other banks you have accounts with as well?  Pretty much all banks (as well as the specialist service providers) will be able to transfer money abroad, obviously it's easier if you already have an account with them.  But it's always going to be a balancing act between the fee they charge and the exchange rate they use.  It may, for instance, be worth paying a higher fee if you get a better exchange rate - for the sum you're talking about, a small difference in the exchange rate can make a fairly noticeable difference in the overall "cost".

As an aside, there is the age-old discussion to be had about lending money to friends and family....  But I'm sure this is something you've already considered and are comfortable with.

 I was surprised at the difference between paying £70 over £9.50 but the £70 cost is far better value. I will check with the other banks though. Moneysavingexpert has a deal with Moneycorp at the moment for Amazon vouchers if you deal through them but that would cost £16321 with a £50 voucher so Wise is winning at the moment. Thank you Exodi..........

Yes I have read lots of stories about lending to family but we have no children and just one sister each so his will get it in the end anyway but she has had a hard divorce and at 70 has to work to pay her mortgage, the roof needing work was a shocker......She said she will get something written up by a notary so if anything happens to her we will get it back from her estate. 

Ayr_Rage

WISE offer near mid-market rates for the currency conversion so despite larger fees the overall cost if often lower than using a real bank and their rates.

Exodi

Archergirl said:
I have not heard of this, how would I do it please,is it safe? 

Halifax would charge £9.50 but sending 20K USD would cost me £16572.75
Wise would charge me £70.06 but it will only cost me £16,092.55 if I have looked it up correctly.

Archergirl said:
 I was surprised at the difference between paying £70 over £9.50 but the £70 cost is far better value. I will check with the other banks though. Moneysavingexpert has a deal with Moneycorp at the moment for Amazon vouchers if you deal through them but that would cost £16321 with a £50 voucher so Wise is winning at the moment. Thank you Exodi..........

Ayr_Rage said:

WISE offer near mid-market rates for the currency conversion so despite larger fees the overall cost if often lower than using a real bank and their rates.

I have used Wise for many years now without issue (previously called TransferWise). It's an absolutely massive company, so I'd say it is safe as it can be (but of course, no company is 'too big to fail').

I use it in both a personal and business capacity, and send multiple transactions per month - all are usually fully processed and received in a day or two.

I have found them to be significantly cheaper than compared to most other options. I also find it easy to use.

Wise would charge me about 0.4% for business transactions, Barclays would charge me about 1.6% for the same. On £10,000, this is a £120 saving.

Think of it like this, instead of sending the money directly to the recipient (via several intermediary banks), with Wise you'd send it directly to one of Wises local accounts (in the UK, in your example), and once received, they'd pay out the recipient directly from an account local to them (in the US, in your example).

If you are worried, you could send a small test transfer, to ensure it is set up correctly - though obviously small transfers aren't very efficient with fees.

wolfehouse

Have a look at Hargreaves Landsdown   https://www.hl.co.uk/investment-services/currency-service

Archergirl

wolfehouse said:

Have a look at Hargreaves Landsdown   https://www.hl.co.uk/investment-services/currency-service

Unfortunately I cannot find out the cost without either opening an account or phoning them.

CliveOfIndia

Archergirl said:

wolfehouse said:

Have a look at Hargreaves Landsdown   https://www.hl.co.uk/investment-services/currency-service

Unfortunately I cannot find out the cost without either opening an account or phoning them.

Any reason why you can't phone them?  I'd have thought it's worth a quick call to find out their prices - if a 5 minute call could potentially save you a few hundred quid, that's time well spent in my book