Use exchange to purchase other investment prop AND.....
Hello,
I am currently looking to conduct a 1031 Exchange with an inv prop I own in Hawaii and I have a couple questions for the more experienced investors who have possibly been in this situation before. Background: I own two investment properties, one in Hawaii (owe approx $210K on mortgage) and one in Bronx, NY (owe approx $38K on mortgage).
My proposed strategy: If I utilize a 1031, I will have approx $215K for the exchange on the gaining property after paying off the mortgage. My initial strategy for this was to find an income producing investment property for under $215K and then use the remaining (after having to painfully pay the cap gains) to payoff my Bronx property and/OR save for a down payment on an actual house for my growing family.
Questions:
1 - What would you do with that situation?
2 - Would you consider a VRBO for the gaining inv prop since you could be free and clear of a mortgage?
3 - Does anyone know if you can use the 1031 to pay off another inv prop (i.e. the Bronx Prop) ....since it's an inv prop, without having to pay cap gains (probably not but have to ask)?
Sorry for the drawn out post but I am really trying to maximize this opportunity in my favor. I look forward to your comments and answers. Thank you in advance!
Ryan