Our Italian Adventure: Do I need an Italian bank account to purchase a house in Italy?

PART 84: It might be interesting to share how we pulled off living in Italy for part of the year. I will post some steps and what we are learning along the way.

We love every minute of it, and what was once a dream is our life!

We live in Tuscany in the Fall, then back again in the Spring, and in California for the rest of the time (in a previous blog, I explained why we live in Italy only part of the year).

Step 1: We recently bought a house in Italy (Tuscany) and were given unclear information about whether we needed a bank account in Italy to purchase a house.

I am not setting myself up as an expert in this area, but I am happy to share some of our experiences.

Step 2: Do I need a bank account in Italy?

The simple answer is: No.

Down payment: I can wire the down payment directly from my bank to the seller's bank to purchase a house in Italy.

Balance of purchase: When it comes time to pay the balance, I can wire the remainder to the bank of the Italian Notary handling the sale.

Step 3: What about the Fiscale Code (codice fiscale)?

IIt is mandatory to have an Italian tax code for several activities, such as opening an Italian bank account, starting an Italian court dispute, buying or inheriting an Italian property, registering a preliminary contract for a property purchase, getting Wifi installed, applying for a utility connection or applying for an Italian mortgage.

When my partner and I decided to purchase a property in Italy, I had already applied for my fiscal code through an Italian consulate in the US. However, after a month, I still hadn't heard anything back. I started to get nervous because the purchase date was approaching. Our realtor told us that they could obtain a codice fiscale much quicker. We decided to let the realtor take over the process, and we obtained our fiscal codes within a week.

Step 4: Is it BETTER to have an Italian bank account set up before purchasing a home in Italy?

The overwhelming answer is: YES!

We returned to the United States after our offer on the house was accepted without opening an Italian bank account. We chose to wire the money to a notary and let him handle the transaction.

However, we soon discovered that the process of closing the sale on the house can be more complicated without an Italian bank account.

Here are some of the challenges we faced:

Firstly, we had to wire money to several banks:

• The down payment to the owner's bank

• The balance of the cost of the house to another bank

• The taxes and notary expenses to another bank
  

Each wire from a US bank would have fees and/or lower than market exchange rates.

Secondly, I wanted to wire the balance of the house payment from my investments instead of directly from a bank. However, I found out that it can take weeks to get approval from an investment firm for a third-party payment (wiring the money to a bank account that is not mine). I had to change my strategy since I only had a few weeks before the closing. I had the investment firm wire the money to my US bank account, and then I had my bank wire it to Italy. However, like most others, my bank didn't give me a great exchange rate, and I didn't have enough time to learn how to use services like Wise or other transfer services.

Finally, fees are attached to a notary handling the final payment for the house rather than the buyer bringing a certified check from the bank.

Despite these challenges, we overcame them all and successfully closed on the house.

Step 5: How to open an Italian bank account: Can I do it online?

It has been said that opening a bank account in Italy online is possible. Before purchasing our house, while we were in Rome a few days before returning to California, I visited the bank's website and filled out the questionnaire. I thought it would be an easy process and that we would have our bank account before buying the house. However, I encountered a question that required me to scan in my Tessera Sanitaria, or Italian health insurance card. Since we were not residents, we did not have one.

Fortunately, there are branches of this bank all over Rome. I took my computer, walked to the branch and explained the problem.

"You don't need to be a resident of Italy to open a bank account. However, you do need to be a resident to open an account online. You just need your passport to open an account in person," they told me.

Therefore, to open an online bank account, you must be a registered resident of Italy. Otherwise, you must do it in person.

One requirement of opening up a bank account in Italy is supplying the bank with an Italian address of residence. Since we had been renting a home in Puglia, this wasn’t a problem for us. In fact, the bank told me that I could supply the address of the home we were purchasing, even though we hadn’t closed on it yet. 

Step 6: Opening an account in a different city.

At the same bank in Rome, I asked, "So can I just open an account here and then access it from Tuscany, where we will live?"

The bank employee shook her head. "In theory, yes, you can access your funds anywhere. But I would strongly suggest you open your account in the town where you will be living. Otherwise, you will not have access to some of the bank services you may need."

In California, my bank is in Los Angeles, and I live in Palm Springs; I have access to all bank services everywhere.

But, according to the banks in Italy that I consulted, opening one's account in the city of residence is always recommended to access all of the bank's services.

Step 7: What about utilities?

Based on what my expat friends have told me, there are a few options to pay for utilities in Italy. You can pay in person, use PayPal, or pay through your bank.

However, the most convenient way to manage your utility payments in Italy is by connecting them to your Italian bank account and setting up automatic payments. This will help avoid any issues that may arise from missed payments due to an oversight, such as a lost email or a mistake made while using PayPal.

To avoid any potential issues with our utility payments, our realtor has helped us set up automatic payments.

Step 8: Opening the account in our town

We just arrived in Tuscany to finalize the purchase of our house. We transferred the money for the purchase to the Notary, who did an excellent job guiding us through the closing process.

The next day, I visited a local branch of Intesa San Paolo, a well-known Italian bank, to open my first bank account in Italy. The account opening process took two days but was effortless and straightforward. The day after opening the account, I wired money from the US to the account to make paying for home renovations more manageable.

Having an Italian bank account has made money transfers, bill payments, and obtaining euros much more convenient. I regret not having done it sooner.

Insights:

We are gradually discovering what life in Italy is like and adapting as we go. Despite making mistakes along the way, we try to learn from them. We always seek guidance from locals and draw insights from our experiences.

The process would have been smoother if we had opened an Italian bank account before buying a house. Now that we have a local bank account, paying bills and handling other expenses has become much easier.

More next time.

Now on sale for $2.99: My book is "Stories from Puglia: Two Californians in Southern Italy." Amazon US: https://www.amazon.com/dp/B0CRKMKPWF?ref_=cm_sw_r_cp_ud_dp_X2WRQ3PTG2ZDD7AVF6GH

Amazon Italy- my book "Lei mi ha sedotto. Una storia d'amore con Roma": https://amzn.eu/d/13nuZCL.