First but then sale to use a 1031?

Question

I have a property that is giving me lots of troubles. Can I buy another property first, then sale this trouble some property and domp all the profits in to the "JUST BOUGHT property and will it quality as 1031 exchange??

Dave Foster · Answer

@Jose Ortiz, The 1031 process has to be managed by an unrelated 3rd party called the qualified intermediary. By law you have to close your sale with the intermediary as part of the process. And then you have 45 days to identify your new property and the entire process has to be complete within 180 days. It's a very rigid process.

1. You cannot take title to your new property before your old property sells.

2. You cannot exchange into property you already

I'll reach out via pm and give you an overview of the process.

1. You cannot take title to your new property before your old property sells.

2. You cannot exchange into property you already

I'll reach out via pm and give you an overview of the process.

Dave Foster · Answer

@Jacob Gomes, You still cannot take title to your new property until your old property sells. A reverse exchange doesn't change that. But we as the QI take title to the new property and can hold it for up to 180 days until your old property sells. You have to provide financing (and a conventional mortgage will not work). And these are several thousand dollars more than a regular exchange. Reach out to me via pm and I'll put some more resources in your handa.

Alex Olson · Answer

@Jacob Gomes These are rarely successful. To be frank, I have never had one work out for a client in a market like this - if looking for multifamily that is of quality. The market is too good for sellers and buyers to want to wait around for things and there are all sorts of risks. I would encourage your client to go the traditional route - just make sure to be with them every step of the way to be successful.

Jacob Gomes · Answer

What about the reverse 1031 exchange route?

I haven't executed one but I've explored the option with clients.

Chris Picciurro · Answer

You need to work with a qualified intermediary (QI) to property execute the transaction. I believe there is a reverse 1031 exchange but again talk to a QI.

First but then sale to use a 1031?

First but then sale to use a 1031?

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