1031 Exchange - Question
Hi all, I've looked around the site a lot, but I'm new to posting. I have a few single family homes in the Chicago suburbs, and I have a question regarding a 1031 exchange.
I bought my first property for all cash for approximately $50,000. It is held in a Series LLC. It is currently worth approximately $100,000. I'm considering doing a refinance to pull some cash out to use as a down payment for another property. The cash out amount would be below my original basis in the property (say $45,000)
a. Are there 1031 exchange concerns if I do a cash out refinance now, or only when I sell?
b. Is there an issue if I don't use every penny of the cash-out refinance for a new property?
Thanks for your help everyone.