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What is involved in trading one house for another in ...

Sent to Legal Experts June 25 11:47 AM

What is involved in trading one house for another in the State of California?

 

Customer (name blocked for privacy)
Status:  Closed   Value: $15
Info Request
June 25 6:03 PM (6 hours and 16 minutes and 7 seconds later)
         
REPLIED to Info RequestCheck Mark

Do you mean just an exchange of houses between two persons?

Or selling the house and buying another one?

What kind on involvement do you mean?

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LEV -- Retired -- 99% Positive Feedback on 1335 Legal Accepts
Taxes, Immigration, Labor law
Reply
June 25 9:48 PM (3 hours and 45 minutes and 4 seconds later)
         
Reply to Lev's Post: Lev - Below please find some specifics:

-Our house has an unassumable loan.
-We owe the bank less than we have in equity.     
-Rather than go through the process of putting the house up for sale we thought we would offer a trade to the other party.
-The other party is interested in doing a 1031 exchange into our house which would then become their rental property.
-The house they are currently selling, that we are interestd in purchasing, came to them by inheritance.
-Their house would be a trade up for us.
-How does our equity play into this process?
-Does a 1031 exchange, on their part, help or hurt us?
   
Please let us know if you need more info.
Thanks for the help
smithfam
Customer (name blocked for privacy)
Answer
June 26 12:40 AM (2 hours and 51 minutes and 48 seconds later)
         
ACCEPTEDCheck Mark

As you are selling (or exchanging) the property that have mortgage - you would need either to obtain the mortgage for new property or pay off the mortgage for the old property.

The equity on the old property will be rolled into the new property and will be used to calculate amount you need for financing.

1031 exchange that another party used should not make any difference to you. However because it is more complex transaction you have higher risk that it might be longer or might not be completed at all.

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LEV -- Retired -- 99% Positive Feedback on 1335 Legal Accepts
Taxes, Immigration, Labor law
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