Permanent house exchange (contingent, appraisal, mortgage, mortgages)

[willbo1]

Anyone have any insight on how this works? I have an possible opportunity to permanently exchange my florida home for one in NC. How do I determine if it is an equitable exchange? I know both properties have mortgages on them so what happens with those. I know my home in Florida is more up to date and in better condition than the one I am potentially going to but the need to be closer to family is worth money to me. I have gone through it a bit in my head but cannot come up with how the exchange would end up working. Any insight would be great. Thanks.

[rrah]

I would begin with a call to an attorney.

I would also recommend an appraisal of each property to determine value. The specific appraiser should be agreed upon by both parties to the exchange.

Assuming both parties need to pay off a mortgage and probably will need a new mortgage, I think, and I am not an attorney, that the easiest way to accomplish this would be for each party to sell/buy to the other party. Each party will sign two contracts to purchase. There might be some other ways to make this "permanant" but that seems to be the clearest to me.

[UseJeff]

It is likely you'll do it as two purchases, contingent upon each other. Do your best to keep the sales prices as low as possible, mainly for property tax implications. (your neighbors will hate the low sales price, but you have to take care of yourself first).

The mortgage will almost for sure need to be paid off, and you will need new mortgages. The only thing that is possible is if one or both houses have assumable mortgages. The person assuming the new mortgage would need to go through the approval process, and once approved, can assume the mortgage. The loan would remain exactly how it was previous, just under a new persons name. This could be a huge benefit as they both likely have better rates than are attainable at this point in time.

I think the best thing to do would be to discuss this with a reputable title company, as well as possibly enlist the services of a real estate attorney, or real estate agent. I think the attorney would be the best choice personally.