Choosing Your Qualified Intermediary
5 Things to Look For In Your Qualified Intermediary
Before you can begin your 1031 exchange, you will have to select a Qualified Intermediary (QI). A good QI can make or break your exchange. To ensure that everything goes smoothly it is important to make sure that your Qualified Intermediary is actually qualified. Here are five things to look for in a QI.
1. They should use a segregated, qualified escrow account (at no charge)
Make sure that the QI you select does not have a pooled exchange account. It is important to ensure that your exchange account is not comingled with someone else’s funds. Your QI should have a segregated qualified escrow account so that only your money is in that account and it is identifiable to you.
2. They should guarantee their exchange
Your Qualified Intermediary should do everything in their power to ensure that your exchange is successful. A good QI should be able to assure you that your exchange will be carried out without a hitch.
3. Audit protection – providing support and documentation if needed (at no charge)
Make sure that the QI you select keeps their records and documents tidy. Should an audit occur, you want to be certain that your QI has all the documentation you need.
4. They must be easily accessible to answer questions (at no charge)
Avoid Qualified Intermediaries with poor communication skills. You want your QI to be reachable and ready to answer any questions that you might have. Keep track of how long it takes them to answer phone calls and emails. They should be responsive to your inquiries as they are holding your hard earned profits.
You want to look for a QI who has experience, a reputation in the industry, and who has demonstrable results. Do not select a Qualified Intermediary who does not have a history to back up their claims.
Selecting a good QI is a key step in ensuring that your 1031 goes as planned. If you select the right QI to guide you through the process, you can focus on your real estate investing as they handle documentation.
To learn more about how you can utilize the power of a 1031 Exchange call us now at 850-889-1031 or click here to schedule your free consultation.