Reverse Exchange, Part 1

The questions here were received from interested 1031 exchangers visiting my website. I have chosen to leave the questions intact with their ambiguity, shorthand writing and misspellings so as not to act on the assumption as to what when unclear the questioner meant.

Reverse Exchange, Part 1

Question:
Can we do a 1031 exchange if we buy a property first, THEN sell the like property? I have a closing date for my purchase, but not yet for my sale.

Answer:
Yes, you can. To do a 1031 exchange in this situation, you need a Qualified Intermediary who is also an EAT (Exchange Accommodation Titleholder) to handle your reverse 1031 exchange process.

One thing to know is that you’ll need to be able to self-finance any loans. The paperwork is significant, and most EAT’s fees start at around $5,000. That makes this option highly impractical for some property owners, but comes in handy you have a good reason to go that route, and you’re able to swing it financially.

About Marilee: Role of Marilee Hill, Registered Representative (RR)

Marilee Hill has particular experience with the nuts and bolts of a 1031 exchange deal as a licensed FINRA professional. Time and experience in this field translates into key support for customers and knowledge of the people side of the business, which is also important. Get free advice for a 1031 exchange deal and consulting on how to hire a qualified intermediary and more.