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Location: Monterey Bay, California -- watching the sea lions, whales and otters! :D
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I know I sound like a dolt, however, I am not a realtor, broker, nor well-informed about real estate. I'm posing a hypothetical question, and wonder if this is something feasible, or is it just impossible? I'm sure there would be legal documents for this, and maybe not done in a typical real estate fashion, but it sounds logical.....
Hypothetically, a homeowner has a house appraised worth $500,000, but the homeowner still owed, let's say $265,000 on that now worth $500,000 home in a place a few miles from the ocean and beautiful setting, but wants to relocate to another city/state -- can they "trade" a house with someone else?
For instance, say someone in Arizona always wanted to live near the ocean in California, but with house prices being as high as they are, they figure they'll never be able to afford it because their house is only worth $245,000.
Well, what if a homeowner in California who really wanted to live in Arizona -- for family reasons, or wanting to be in the desert, a job, whatever - suggested to a realtor in Arizona to find someone who would want to live in California and be willing to trade houses?
Now, the person in California would be willing to trade their home worth $500,000, if the person in Arizona pays for (takes on) the $275,000 outstanding mortgage. The person in California moves into the $255,000 home in Arizona, and is happy to do so because if they paid off their $265,000 mortgage, at most they would receive is $235,000 after doing so, which would not buy them (in full without a mortgage) a home worth $255,000 in Arizona, anyway.....are you following this??
Theoretically, the person in California would have a paid-off home worth $255,000 in Arizona where they want to be; and the person in Arizona, would pay only $265,000 for a home worth $500,000 in California near the beach where they really want to be! Each positively make out!
Is this anything that is ever done?? I was talking to some friends about this and they agree that this is something that could easily work for those wanting to relocate to other areas, but want to "pay off" their mortgage, and would still benefit someone who wants to be in their area, and will now pay much less to be there. It sounds like a win-win situation to me, and I wonder if this is a "real" practice that is just not heard about often. Now that I re-read this, I'm getting confused. Or would they both be better off to try to sell, especially in this market, or would a trade be more logical? Well, I think you get the idea.....I hope! Sorry if it sounds confusing.
I don't know anything about real estate, per se, so feedback is appreciated. Thanks!
I know I sound like a dolt, however, I am not a realtor, broker, nor well-informed about real estate. I'm posing a hypothetical question, and wonder if this is something feasible, or is it just impossible? I'm sure there would be legal documents for this, and maybe not done in a typical real estate fashion, but it sounds logical.....
Hypothetically, a homeowner has a house appraised worth $500,000, but the homeowner still owed, let's say $265,000 on that now worth $500,000 home in a place a few miles from the ocean and beautiful setting, but wants to relocate to another city/state -- can they "trade" a house with someone else?
For instance, say someone in Arizona always wanted to live near the ocean in California, but with house prices being as high as they are, they figure they'll never be able to afford it because their house is only worth $245,000.
Well, what if a homeowner in California who really wanted to live in Arizona -- for family reasons, or wanting to be in the desert, a job, whatever - suggested to a realtor in Arizona to find someone who would want to live in California and be willing to trade houses?
Now, the person in California would be willing to trade their home worth $500,000, if the person in Arizona pays for (takes on) the $275,000 outstanding mortgage. The person in California moves into the $255,000 home in Arizona, and is happy to do so because if they paid off their $265,000 mortgage, at most they would receive is $235,000 after doing so, which would not buy them (in full without a mortgage) a home worth $255,000 in Arizona, anyway.....are you following this??
Theoretically, the person in California would have a paid-off home worth $255,000 in Arizona where they want to be; and the person in Arizona, would pay only $265,000 for a home worth $500,000 in California near the beach where they really want to be! Each positively make out!
Is this anything that is ever done?? I was talking to some friends about this and they agree that this is something that could easily work for those wanting to relocate to other areas, but want to "pay off" their mortgage, and would still benefit someone who wants to be in their area, and will now pay much less to be there. It sounds like a win-win situation to me, and I wonder if this is a "real" practice that is just not heard about often. Now that I re-read this, I'm getting confused. Or would they both be better off to try to sell, especially in this market, or would a trade be more logical? Well, I think you get the idea.....I hope! Sorry if it sounds confusing.
I don't know anything about real estate, per se, so feedback is appreciated. Thanks!
Not only can it be done, but its rather common for investors (although more common for investment properties then residential because of tax implications)
This is a 1031 exchange, I believe? call Jersey Realty Exchange Corp.
888-871-1031 www.jerseyrealtyexchangecorp.com
They are in Jersey, but they do exchanges for all states, and are very knowledgable and helpful.
It is simply two sales. One might set it up with a single or simultaneous escrow but that is all it is.
It appears that any money saved would be the commissions and perhaps some closing costs. But this is the sort of thing that is almost impossible without agent assistance. One might also play some games with AITDs I suppose though that again tends to cross legal lines.
Presuming these are primary residences they are not eligible for 1031 which would also not make sense with the facts listed
Location: Monterey Bay, California -- watching the sea lions, whales and otters! :D
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Ericgummer: What part of California are you in? Because I am looking to trade my house. I am currently live in Arizona. would be nice in the Bay Area.
I'm surprised to see this thread revived. I'm actually around Santa Cruz -- "Surf City." Unfortunately, I do not want to move to Arizona, as I lived in Phoenix/Tempe before, and I plan to not relocate to AZ. It is not a place with great memories for me. I guess I shouldn't have used Arizona as an example -- it wasn't my personal preference, just using it as a possibility. Sorry.
My house was recently appraised for $455,000 -- of course, I owe nearly half that in the original price -- have no idea how that plays out. Currently, I am considering Northern California -- more eastern or mid-part of CA -- or New Mexico.
Location: Halfway between Number 4 Privet Drive and Forks, WA
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It is simply two sales
Agreed. You'd buy theirs and they'd buy yours. Not the same as a 1031. There are lots of sites for sellers having hard times selling where home swapping is becoming more mainstream.
I am very interested in this thread as well. Currently I am trying to find someone who would like to trade their property for mine. I have had one party interested and neither of us knows how to go about doing this. My property is worth 375K and I owe 87K. Their property is worth around 300K and they owe 110K.
Do we try to get new mortgages? Obviously they would owe me the difference in value of our 2 homes. I am not sure how we go about taking care of the mortgages.
We have thought about finding out if the mortgages are assumable. However, my current mortgage is lower as is the payment by $200/mo. And my property is worth more.
Any ideas or suggestions would be greatly appreciated!
Yes is hard to sale in this time, I'm thinking in the swap home (sale - buy) option to, doing it correctly, it may be a lot faster. My home is in Arkansas a 6 bed, 4 bath, and is not expensive, my family and me we are planing to move to Mcallen or around it or San Antonio or Austin, TX maybe
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real estate swap/trade
