Accruit Blog

Federation of Exchange Accommodators Praises Passage of New Exchange Facilitator Regulations in Colorado

  • Rep. Joel Judd applauded for defending the interests of consumers and businesses performing Section 1031 exchanges
  • ..."no client should have reason to fear doing a Like Kind-Exchange."

March 26, 2009

(Denver) Colorado House Bill 09-1254, sponsored by State Representative Joel Judd and State Senator Ted Harvey, has been unanimously passed by the 67th General Assembly of the State of Colorado. This legislation is designed to create consumer protections relating to Section 1031 Like-Kind Exchanges facilitated by Qualified Intermediaries (QI) and Exchange Accommodation Titleholders, otherwise known as Exchange Facilitators.

Lending Issues for 1031 Exchanges

February 2007

Many issues with lending can create unplanned legal or tax consequences and at times may prohibit a mortgage from being funded at closing.

These TIC purchases often require commercial bank lending. For a 100% tax deferred exchange, the exchanger needs to make sure that all of the net proceeds from the sale of their old property are utilized for the TIC purchase. Additionally, any mortgage debt paid off from the sale of their old property must be replaced. Many of the commercial lenders for these TIC purchases require the bank lending be made to a Delaware LLC entity. This creates the requirement for the 1031 exchanger to have a single member LLC for each party of the exchange.

Check out the following lending issues prior to your 1031 exchange transaction:

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