1031 Exchange with HELOC
Hi all. Sorry if this sounds repetitive as I've read a lot of other 1031/HELOC questions but haven't found one that answers my specific question yet.
We know from experience the overall rules of a 1031 exchange but our last one didn't have a HELOC and there are varying opinions on one topic, debt.
Our laat custodian told us that we had to acquire at least as much debt on the new property as we had on the relinquished property at the time of the sale. Some have argued that this is not true but we'd rather not find out the hard way and will listen to our custodian.
So here is our question. We have a rental we are thinking of selling. The mortgage is currently about $87k and we have a HELOC of $75k with currently no balance. The question is, let's say we draw $13k on the HELOC and sell the property. Would we then have to acquire at least $100k in debt on the new property or does the HELOC not count toward that and we would only have to acquire at least $87k?
Hope this makes sense and thanks in advance for responses.