Dallas-Fort Worth Real Estate Investor Club

I have a potential client who has mentioned she wants to sell her current property and purchase a new one using a 1031 exchange. Does anyone know what the extent of my role as her agent would be other than directing her to a tax attorney and locating a new property for her? Thank you.

The contract for the sale and purchase must be assignable. You can accomplish this by listing the Seller on the relinquished property as "Jane Doe and /or Assigns." You do the same for the Buyer of the acquisition property. Additionally, there is language that should be entered into the Special Provisions section of both contracts. You should have your client contact a provider of 1031 services such as Asset Preservation, www.apiexchange.com, for guidance. Remember, you as an agent cannot practice law, the language inserted into Special Provisions should be provided by your client with written instruction to you to insert such language into the contract. Asset Preservation can provide your client with the sample language.

Before you do anything you should consult your sponsoring broker for his/her advice and direction.

Howard Cox

@ Howard. Thank you

@ Philip. I am trying to communicate to my client that it is so very crucial for her to contact a 1031 expert. My knee jerk reaction is, as you stated, the benefit does not seem (to me anyway) to be worth the extra stuff that comes with this type of deal. I cannot tell her that. Not in my scope and also just my opinion.

She keeps wanting to assume that she can purchase a property here, sell her 4 plex located elsewhere, then decide to do a 1031. I keep advising her over and over to talk to someone because I do not want her to lose the "deal" she wants and then bring it back on me for not telling her something. Email and paper trail??