I have been working with a past client to help with financing a new investment property. She recently sold an investment property in another State and wanted to delay paying capital gains on the proceeds from the sale, so she decided to do what is called a 1031 Exchange.
When she closed on the property the proceeds went into an account managed by what is called a "Qualified Intermediary". This is a company that is either a Title Company or a special legal entity who will manage the money during the Exchange.
She then had 45 days from the sale of the property to identify 3 properties she would possibly purchase and have one of them under contract. She then had 180 days to close on the new property. The new property had to be a "Like Kind" property, or simply put, another investment property.
The purpose of this type of purchase is to delay paying capital gains on the proceeds from the sale of her old property by purchasing another and transferring to a similar sale price and loan amount to what she had originally owned.
So, if you are an investor, or a Realtor who has clients that might benefit from a 1031 Exchange, give me a call and let's discuss this further. Sherry Bitner 941-504-1445