1031 exchange advice - Posted by charles (del)


#1

Posted by Bud Branstetter on November 09, 1998 at 13:01:47:

The exchange fee is not out of line with what is charged in the Dallas area. The attorney fees seem high but we don’t know all the deeds/work that he expended. There are a number of exchangers on the web so that you can shop fees. You would want to use someone familiar with the process so that it is not done wrong.


#2

1031 exchange advice - Posted by charles (del)

Posted by charles (del) on November 08, 1998 at 15:05:06:

Is it worth it to 1031 exchange when you are faced with a $100K profit?

I have heard from some it is too expensive in terms of fees for small properties and from others that it is worth it.

For instance, I may make a $75K net profit next year on a large residential lot that I would like to roll into a small commercial bldg, $114K asking price.

Could I 1031 exchange the property into the commercial then immdediately take a mortgage on the commercial property to get my cash back or do I need to season the property first?


#3

Our exchange fees - Posted by William L. Exeter

Posted by William L. Exeter on November 10, 1998 at 13:28:49:

The fees are high for the transaction that you have outlined. Our fees on a $100K exchange would be a $500.00 set-up fee and the interest earned on the funds while we hold the funds for your exchange. This includes all legal documents, including the exchange agreement, assignments, etc. There are no transaction fees and we pay all overnight delivery charges. Please email me for more information. Be sure to check the exchange companies’ financial strength, bonding and financial backing.

Bill Exeter
Security Trust Company


#4

Re: 1031 exchange advice - Posted by mike

Posted by mike on November 09, 1998 at 10:11:53:

it is expensive to do it wrong!


#5

Re: 1031 exchange advice - Posted by Laure

Posted by Laure on November 08, 1998 at 21:11:14:

YES YES YES !!! I have done 2 exchanges this year! I usually have to pay the bank (which is my escrow agent) $1000.00 and my attorney fees are around 1500.00 for a total of 2500.00 I think the capital gains on your 100,000 gain would be 20%, That’s 20,000.00. You can defer the tax and use the gov’s money indefinately. go for it ! I have also taken back a mortgage on an exchanged property as quickly as 30 days. That might be a bit risky, but my attorney said as long as it wasn’t at the exchange closing I’d be ok.

Hope I helped.
Laure :slight_smile:


#6

Re: 1031 exchange advice - Posted by Jack

Posted by Jack on November 09, 1998 at 08:43:53:

Disclaimer: I have never done an exchange, but have read a little about it, so I am dangerous. But I am also curious, so…

Why does your bank (as escrow agent) charge what seems like such a high fee just to hold the sale proceeds until you close on the replacement property. What else do they do to earn that kind of fee?

As I understand it, anyone can be your escrow agent as long as they are not among the excluded group (e.g., relatives, real estate agent, your attorney, etc.).

Also, what does your attorney do for the fees rendered? And after he/she has done it for you once, is it not possible to duplicate the paper work as many do for creating LCCs, notes, etc.?

An investor I know had a local CPA handle an exchange for $1,500, which I thought was high, considering how simple they seem to be on paper.

What am I missing? I plan to do an exchange next year, and I’d like to go into it well informed.

Thanks,

Jack Stivers