Case Study

Reverse 1031 Exchange - 18 Condo Refinance

Loan Details

Loan Amount:  $2,000,000

Loan-To-Value:  65% LTV

Rate:  8.50% 

Term:  12-Month

Situation & Challenge

The owner of the 18-unit condo building was doing a 1031 Exchange, selling this property to buy a larger multi-family investment property, but hit a glitch when the buyer’s financing fell through a week before the scheduled close of escrow.

The seller needed to switch course, going from a regular 1031 Exchange to a Reverse 1031 Exchange. That meant taking cash out of the subject property to use as down payment funds on the acquiring property.

Solution & Result

First Capital Trust Deeds worked with a private mortgage investment fund to get lower cost bridge financing on the condo at 8.50%.

The owner used the proceeds of the refinance to execute the Reverse 1031 Exchange. The 18 condos sold within three months, allowing the owner to complete the exchange. 

Do you have a similar financing scenario?
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