How Do Wire Transfers Work?
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Why Use a Wire Transfer?
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Wire transfers are a fast, secure way to move money from one account to another and are often used when making a large purchase.
Many people wire transfer funds for a down payment on a home mortgage or they may wire money to friends or family in need.
Wire transfers do not require an individual to be present or to actually touch the funds that will be wired. Wires often can be done over the phone or online, depending on the set-up at the bank that is sending the wire.
How it Works
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Wire transfers move money from one account to another. Doing a transfer is relatively simple, once all the information is collected. In order to do a wire transfer, the bank account numbers, wire transfer instructions and the amount of the funds to be moved must be obtained.
Before calling the bank to begin the wire, the wire instructions must be obtained from the bank that will receive the funds. The receiving bank will need to provide an account number, an ABA (American Banking Association) number and contact information.
Funds may be wired from bank to bank anywhere in the world. In order to start the wire process, contact the bank's account manager or individual who handles wire transfers. Alert this person to the amount of the transfer, the account it will go to and the wire instructions.
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Conclusion
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A wire transfer usually moves money during the same business day it is requested. Follow up with the receiving bank to make sure that the funds were received.
Wire transfers are useful if money must be transferred quickly or if a large amount of money must be moved. Transferring money by wire is considered one of the most safe and secure methods of moving money between accounts.
Most banks charge modest wire transfer fees for the service.
Besides banks, Western Union or MoneyGram, both federally insured, may be used to wire money. In these instances, an individual must bring the amount of money to be wired to the Western Union or MoneyGram storefront and it will be wired to another store in their chain where it may be retrieved by the recipient.
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