As a real estate investor, once you discover the benefits offered by 1031 exchange programs, you will become interested in this type of process yourself. After deciding that you want to swap one of your properties with someone, in order to expand your business and maximize your profits, the next step is to find yourself a facilitator who can coordinate the entire process. When it comes to property exchange intermediaries, the variety of offers found on the market is surely extensive, which means it can be difficult to make a choice. However, to ensure yourself that you are working with the best facilitator, you should have a few considerations in mind when you are trying to select a specialist:
Find out how your founds will be held
Because the facilitator will be the person who will manage your founds, you probably want to be 100 percent sure that your money is kept safely. This means finding out the methods used by the intermediary in terms of founds. You should discuss with the facilitator and insist for the founds to be kept in a segregated qualified trust or escrow account, which is the most reliable option and try to avoid commingled accounts, because they are not as safe as you desire. You have the possibility of choosing the bank of your choice, so if the qualified intermediary seems to not agree with your choices, perhaps you should look for someone else, because this might be a red flag.
Discuss with some of their other clients
To receive more accurate and concrete information regarding the performance of one company or another, you should request a few client references. See if the investors they have collaborated with in the past have been satisfied with the support received, or if they have had any complaints. This will be an easy way of establishing exactly how reliable the qualified intermediary actually is.
Experience in the industry
Last but not least, find out if the facilitator is sufficiently experienced in this industry. With how many clients have they worked with in the past? Did all the processes they have coordinated ended with successful results? Longevity and experience can make a big difference, so you should not overlook these aspects, if you want to receive the high level of service quality you desire. Being well informed on the topic is the only way you can make a reliable choice. So ask the facilitator for how long they have worked in the industry, and see if the answer is the one you were looking for.
1031 exchanges give you the opportunity to expand your real estate business, without being forced to spend a fortune on taxes. However, because you will need a qualified intermediary to make the process happen, you need to make sure you are working with the right specialist. Follow the tips mentioned above, and you will manage to choose a facilitator that will meet your needs and requirements, and make the entire process as smooth and uncomplicated as possible.