All Forum Posts by: Marian Smith

Thanks Dawn...and everyone else for responding.  If I go through with it I will try to return and share my experience.  But we are moving so i may forget.

Dawn, I called a title company because that makes sense....for them to facilitate an exchange to get the title and closing business.  The one I called said they couldn't do it because they would be providing other services for me thus disqualifying themselves--which doesnt make sense really, but they gave me the name of an attorney.   Stewart Title has a subsidiary called Asset something or another and they were over 1k.  I can see the 1k price tag  for a business of some sort...there are all kinds of like exchanges.  But the sale of one residential property to be exchanged for another of an equal or higher price seems simple and straight forward.   I would feel like a schmuck paying that much.  The people referring to it as a "small fee" must just have more money than I do.

I am asking if anyone has ever asked an intelligent, trustworthy friend to act as qualified intermediary in a 1031 exchange.  And yes, I would trust my accountant friend to receive the proceeds from a real estate transaction and place the money in escrow in such a manner that I never touch it,  hold documentation for three prospective properties, and later release the escrowed funds when I close on a property or fail to close on one.  It would be a felony if she stole it and she has assets of her own and moreover, she is a nice person.  I would rather pay her than a stranger and from what I have read the IRS appears to be more interested in saying who cannot be an intermediary.  The "qualified" doesn't mean certified or trained, it means "not interested party" so a "no incentive to cheat the government out of taxes" type of intermediary.  I am sure my friend wants me to pay my fair share of taxes just like she pays hers.

Thanks for the responses.   I just don't think I can find an acceptable replacement in 45 days, but want to try.  

I need to read the code again.  If there is specific language required, it aught to be spelled out.  My understanding is that the sales proceeds need to be escrowed immediately upon sale by a disinterested party.  3 properties identified by legal description within 45 days...in writing.   Property purchased for equal or more money within 45 days or within 6 months if they were identified in writing.  How can that be worth 1k?  I am actually as equally worried about my money in escrow by Quickie1031.com as I am about spending the money and not finding a replacement.

i don't see anywhere in the IRS code that states that the QI needs to be anyone in particular.  It just can NOT be a relative,  or your accountant, realtor, etc.

I was just quoted a $1200 price for a 1031 exchange professional.  A title company aught to offer it as a standard service...not for free.  But not for $1200 for crying out loud.

Anybody use a friend or relative who is a lawyer or accountant?  I have a neighbor who would not steal from me who  has an accounting degree.  I could have the title company set up an escrow account in her name.and get a receipt of some sort.  I could make a list of 3 properties,  have it notarized and give it to her.  she could receipt that. That is about it from what I can tell.  Then she would give instructions to the title company to fund the next purchase.

Anybody ever do this?

polybutelene pipes from the 70s to 90s deteriorate from chlorinated water and sometimes break without warning.....so It sounds like they're in the walls.

just saw you already had an appraisal. did it appraise for purchase price?

Realtors are bound to represent the seller unless you have a buyer representation contract with them. That said, no realtor can outright lie to you. This sounds analogous to a house with a finished basement that is legally not part of the square footage but is certainly worth much more than the exact same house next door with an unfinished basement. Ditto a house with a bonus room with no closet that cannot be described as a bedroom but could certainly be a bedroom.

I would ask my realtor to show me comp sales to justify the price.

Also, house must appraise at the purchase price for your loan process to go as expected...the bank appraisal SHOULD act as a safeguard to overpaying.

You attend the auctions on the chance that a property is offered at a price you feel is worth buying. There will be people with cashiers checks and a laptop pulling up a spreadsheet on each property with a price they will pay. Banks have a BPO and an account of what they're owed plus fees for each property. They usually offer the property for the latter at auction but not always, sometimes the former, sometimes, it appears, the former with a distressed discount The buys are when the loan amount is low, but most of these have had numerous offers from investors, and when the bank offers with a discount low enough to make it a good buy. Then you bid against the guys with the spreadsheet. It is really something you have to put some time into knowing there may or may not be a payoff. In a hot market you may need quite a bit of luck.

What is expensive to miss when buying a house? Here is my list, I hope you guys will add to it.

1. FPE breaker box....stab-lock breakers are reputed to fail and the breakers are no longer sold except used ones on ebay. I have heard insurers on the east coast wont insure a house with this type panel. Dallas has hundreds of thousands of houses with these (NPC homes) and the paper reported on this issue.

2. I think you have to request a Lead based paint screen. They sell kits at Home Depot. The problem here is contractors, for example window replacement guys from big boxes, will test and if positive your install price wtill go through the roof because they have to wear suits, tape off and sheet over everything, etc.

3. Ditto asbestos in popcorn ceilings.

4. And there is some sort of plastic plumbing that was used in the 60s or 70s and maybe even the 80s that didn't perform as expected...it is garbage. But I do not know whether it is in the walls or to the street nor how to recognize its use.

5. We also bought a little old lady house that smelled of mold (washer leak) pet urine and smoke. After priming and painting everything we realized the HVAC vents smelled like smoke...worse than when we bought because (I guess) we bought in a mild winter and the house had been aired out and the HVAC was not running because it wasn't needed. I never run the system while renovating because I want to minimize dust in the system so I didnt realize until virtually finished and running the AC. We bought a Clen-aire gel cube thing at Ferguson's to put in the return and it really helped. But I think it would take a coil cleaning, coil replacement and/or new ducts to truly remedy the problem because when the system turns on after having been off for an hour or so it blows air with a subtle hint of stale tobacco smoke. It just lasts a short while, nonetheless...nasty.

We don't usually get inspections so we look for aluminum wiring; patched spots, fake vents etc around plumbing stacks to indicate prior termite treatments and ......what do you look for? Thanks.