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Everything About 1031 Exchange Financing

A 1031 exchange financing agreement is between the intermediary and the exchanger. This document gives the intermediary the authority to purchase the relinquished property and pass it on to the buyer. Other documents required include a 1031 exchange escrow arrangement, amendment and assignment to rollover surrendered property.

There are four types 1031 exchange properties. These are the simultaneous, delayed, reverse, and improvement exchange. You can know more about 1031 exchange financing via

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Below is a brief description of each type of 1031 exchange property.

Simultaneous Exchange

This is a 1031 lease that allows the replacement and exchange property to be transferred simultaneously.

The Delayed Exchange

Also known as the Starker Exchange, this occurs after the property has been closed. These exchanges have strict time limits that must be followed.

Reverse Exchange

This is a 1031 exchange in which the replacement property is bought before the exchange property is sold.

The Improvement Exchange

It is an exchange in which the buyer arranges to make improvements to a property before they receive it as a replacement. There are no legal restrictions regarding the inclusion of any type of improvement in an exchange.

These exchanges are extremely popular and can be very beneficial over the long-term. Many people are interested in 1031 property exchanges due to the legal benefits. These are lucrative and solid property deals that both parties can benefit from. Both parties must reach a mutual agreement on all terms and conditions.