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1031 Exchange on Short Timeline
Hello, I am looking to do a 1031 exchange with an investment property that I need to hold until the end of May 2022. Because I am a teacher and don't get paid over the summer, I would need to identify the replacement property while the relinquish property is in the process of closing, rather than waiting until after it closes, so that I can continue to provide proof of income to the loan officer to secure a mortgage on the replacement property. The issue I'm running into is that I assume I'd need to show proof of funds for the downpayment on a replacement property to even get preapproved, which I won't have until the relinquished property closes--other than taking a bridge loan or a cash-out refi, are there any other solutions you can think of? If it's relevant, I need to hold the relinquished property until 5/28 and my last paycheck arrives 6/14. Thank you!
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@Alex Olson Thanks for your thoughts--I hadn't considered the idea of contract negotiations. Also, I see that you're an agent in the Kansas City area. I am exploring investing in that market later this year. I will definitely be reaching out if/when that time comes.
@Dave Foster Without getting too in the weeds, there are some downsides to holding through the summer with my particular situation but it's something I'll be considering!