FinCEN Postpones Residential Real Estate Reporting Rule Until March 1, 2026

FinCEN (the Financial Crimes Enforcement Network) has announced a postponement of its Anti-Money Laundering Regulations for Residential Real Estate Transfers Rule (“RRE Rule”), now set to take effect March 1, 2026. According to FinCEN, the delay is intended to give the real estate industry more time to prepare for compliance, while maintaining protections against money laundering, terrorist financing, and other financial crimes.  

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What the RRE Rule Does

When implemented, the RRE Rule will expand anti-money laundering reporting obligations beyond traditional financial institutions. It will require certain persons involved in real estate closings and settlements to submit reports and keep records on certain non-financed transfers of an ownership interest in residential real property to specified legal entities and trusts on a nation-wide basis. Transfers made directly to individuals are not covered by the RRE Rule. In the case of a reportable transfer, there is no minimum threshold purchase price and transfers for no consideration are reportable (if not otherwise exempt). The goal of the RRE Rule is to improve transparency around the true ownership of property purchased without institutional financing.

The judicial foreclosure process and resulting foreclosure sales are not reportable, as the RRE Rule includes an exclusion for transfers supervised by a court. Residential foreclosure clients should work with non-judicial trustees and REO closing vendors to ensure compliance with the RRE Rule.  

For timeshare properties, the state definition of a timeshare interest should be reviewed to determine applicability of the RRE Rule. The RRE Rule does not specifically include or exclude timeshare interests; however, the RRE Rule only applies to residential properties as defined by the final rule (89 Fed. Reg. 70258). The RRE Rule defines residential properties broadly¹ as designed and intended principally for the occupancy of one to four families and includes condominiums and co-ops. In some states, such as Florida, a timeshare interest is specifically defined as primarily used for vacation purposes rather than for homestead or investment purposes making the application of the RRE Rule unlikely. See Fla. Stat. 721.81.  

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Key Takeaways  

1. Extra Time to Prepare
   The new start date gives clients until March 2026 to assess internal workflows, identify affected transaction types, and establish reporting processes for covered transfers. This is also a good time to confirm how title, trustee, or closing partners plan to comply.

2. Expect Broader Reporting Once Active
   The RRE Rule aims to close gaps in “all-cash” transactions and is broadly defined. Be sure to monitor announcements from FinCen related to interpretation for the applicability of the rule.

3. Documentation and Recordkeeping
   Although enforcement hasn’t begun, now is the time to review how clients capture beneficial ownership information, wire instructions, and payment data—especially for investor or entity buyers in distressed property or timeshare portfolios.

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This article originally appeared in the February 2026 issue of ALFN ANGLE.

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‍^{[1] For the purposes of this section, residential real property means:}  

^{(i) Real property located in the United States containing a structure designed principally for occupancy by one to four families;}

^{(ii) Land located in the United States on which the transferee intends to build a structure designed principally for occupancy by one to four families;}

^{(iii) A unit designed principally for occupancy by one to four families within a structure on land located in the United States; or}

^{(iv) Shares in a cooperative housing corporation for which the underlying property is located in the United States.}