Buy your replacement property before you sell, with bridge capital built for the reverse exchange structure your intermediary manages.
In a standard 1031 exchange you sell first, then race the 45-day identification clock to find a replacement property. A reverse 1031 exchange flips the order: you acquire the replacement property first and park it with an exchange accommodation titleholder. The safe harbor generally involves identifying the relinquished property within 45 days and completing its sale within 180 days, with additional requirements your qualified intermediary manages.
The catch is financing. Banks struggle with reverse exchanges because the accommodation titleholder, not you, holds title to the parked property, and the whole structure runs on a hard IRS deadline. Most conventional lenders simply decline.
That is exactly the kind of deal we fund. Our reverse 1031 bridge loans provide the capital to acquire the replacement property inside the exchange structure, working directly with your qualified intermediary and exchange accommodator. When your relinquished property sells, the proceeds typically pay the bridge loan down or off, and your intermediary completes the exchange as they structured it.
Speed matters twice in a reverse exchange: once to win the replacement property, and again to stay inside the 180-day window. We close in days, not months, and we have structured loans with California exchange accommodators and their counsel. This is general information, not tax advice; your qualified intermediary and CPA should direct the exchange itself.
A structure under IRS Revenue Procedure 2000-37 that lets you buy your replacement property before selling your relinquished property. An exchange accommodation titleholder holds the parked property, and you generally have 180 days to complete the sale. Your qualified intermediary manages the structure.
Because the accommodation titleholder holds title during the parking period, conventional underwriting treats it as lending to an entity that is not the true borrower. Private lenders like us underwrite the real estate and work within the exchange structure routinely.
Typically from the sale proceeds of your relinquished property within the 180-day window. If the sale runs long, the loan term can extend beyond the exchange deadline so you are not forced into a fire sale.
Standard bridge leverage applies, typically up to 70-75% of the replacement property's value, with the balance coming from your equity or the eventual sale proceeds.
Once your intermediary has the exchange documents in place, we can close in as little as 5 to 10 days, which is usually well ahead of the accommodator's timeline.
Fidelity Funding Corp · Direct California private money lender since 2006
450 N Brand Blvd, 6th Floor · Glendale, CA 91203 · Mon-Fri 8AM-6PM PT