Federal Anti-Money-Laundering Rule Cracks Down on All-Cash Home Purchases—Here’s Who Will Be Affected

The U.S. Treasury Department's financial crime-fighting arm has introduced a new rule aimed at cracking down on money laundering in all-cash home purchases—but everyday buyers shouldn't be alarmed.

The federal regulation, formally known as the "Anti-Money Laundering Regulations for Residential Real Estate Transfers," requires mandatory reporting of all-cash residential real estate transactions involving trusts, estates, limited liability companies (LLCs), corporations, and partnerships to the Financial Crimes Enforcement Network (FinCEN).

The language of the rule makes it clear that it does not apply to property purchases in which the buyer is an individual. In other words, a house hunter looking to buy a $500,000 single-family home without a mortgage will not be expected to report the deal to the Department of the Treasury headed by Secretary Scott Bessent.

"The rule is very targeted, focusing on high-risk all-cash entity or trust transactions, not the broader residential market," stresses Realtor.com® senior economic research analyst Hannah Jones.

Originally unveiled a little over a year ago, the new FinCEN rule will go into effect on Dec. 1, 2025.

The aim of the provision, as laid out in an online summary, is "to curtail the ability of illicit actors to anonymously launder illicit proceeds through transfers of residential real property, which threatens U.S. economic and national security." 

Simply put, FinCEN is seeking to make it harder for criminals using legal entities like trusts and LLCs to launder misbegotten funds through all-cash home purchases while keeping their identities shielded.

"This new rule introduces heightened compliance costs, more transparency, and could disrupt illicit activity, but should not impact typical home sales or most all-cash purchases by individuals," explains Jones. "Over time, it should reduce the use of opaque legal structures for money laundering, while keeping the mainstream residential market largely unaffected."

The regulation, however, does directly affect settlement agents, title insurance companies and agents, escrow agents, and attorneys, who will be responsible for reporting to FinCEN "high-risk" all-cash transfers of residential real estate.

Echoing Jones' words, Ana Bozovic, a Miami-based real estate agent and founder of Analytics Miami, says wealthy buyers—those most likely to use trusts and LLCs—should be able to comply with the new reporting requirement with relative ease.

"This new FinCEN rule creates more procedural complexity, but at the very high end buyers can easily afford the legal and advisory support to navigate it," she tells Realtor.com.

Bozovic says that in Miami, 80% of sales involving expensive properties priced at more than $2,000 per square foot through the second quarter of 2025 were all-cash.

"The main point is this: The high-end, all-cash buyers are not coming to Miami to launder money," she adds. "This logic applies to end users and to investors. They are coming because they have legitimate wealth that they want to diversify out of hostile jurisdictions and because they want to improve their quality of life. The new FinCEN rule does not alter this reality."

What constitutes a reportable transaction?

A home purchase must be reported to FinCEN if it meets four criteria:

• The property is a residential real estate property in the U.S. This includes single-family houses, townhouses, condominiums, and co-ops in large buildings with many such units, as well as entire apartment buildings designed for occupancy by one to four families. The rule also requires reporting on transfers of land on which the buyer plans to build a house designed for occupancy by one to four families.
• The purchase transfer is nonfinanced, meaning that it does not involve a home loan from a financial institution subject to an Anti-Money Laundering (AML) program and Suspicious Activity Report (SAR) obligations.
• The property is transferred to a legal entity or trust. These categories include limited liability companies, corporations, partnerships, and trusts. Both domestic and foreign entities and trusts are covered by the reporting requirement.
• An exemption does not apply. The rule lists 10 types of nonreportable property transfers, including those resulting from death, divorce, and bankruptcy.

Transfers meeting the rule’s requirements must be reported regardless of purchase price or the
value of the property. Gift transfers are also covered by the rule.

Who is expected to make the report?

FinCEN expects that the obligation to report home purchases will typically rest with settlement agents, title insurance agents, escrow agents, and lawyers. There is only one reporting person for any given transfer.

That reporting person will be responsible for filing a Real Estate Report containing information about the property being purchased, the seller, the entity acting as the buyer, and the names of the people representing the entity in the transaction.

The report must be filed with FinCEN no later than 30 calendar days after the closing date, or the last day of the month following the month in which the closing took place, whichever comes later.

How common are all-cash deals?

In the first half of 2025, roughly a third of U.S. home sales were all-cash, meaning that buyers bought properties with their own funds without taking out a mortgage, according to the latest available data from Realtor.com.

Mississippi and New Mexico saw the highest share of all-cash sales during this period, at 48.6% each, followed by Montana (46.2%), Maine (45.2%), and Idaho (44.5%).

Jones notes that the reason all-cash offers are especially common in Mississippi and New Mexico is that for-sale homes there are relatively inexpensive, making it easier for buyers to make a purchase without resorting to financing.

Looking at the use of legal entities in home purchases, approximately 13% of residential properties that changed hands in the U.S. in 2024 were bought by investors using an LLC; a general, limited, or limited liability partnership; or a trust.