1031 + DSCR
How DSCR Financing Fits a 1031 Exchange
A clear look at the separate roles of the exchange team and the replacement-property lender.
A 1031 exchange and a DSCR loan solve different parts of the same investment-property transaction. The qualified intermediary and tax professionals guide the exchange structure; the lender evaluates the replacement property, borrower profile, proposed leverage, and closing path.
Two workstreams must reach the same closing
The exchange team addresses the transfer of the relinquished property, exchange agreement, identification, receipt of replacement property, and tax reporting. The financing team addresses property eligibility, rent, expenses, valuation, title, insurance, reserves, borrower credit, entity review, and loan conditions.
Start before the deadline becomes the problem
Bring the expected exchange equity, target address, purchase price, market rent, taxes, insurance, HOA, requested loan amount, and expected closing date into the financing conversation as early as possible.
The contract and closing plan should reflect both the exchange requirements confirmed by the investor’s advisors and the lender’s realistic property-review timeline.
What the lender does not determine
The lender does not decide whether a transaction qualifies under Section 1031, act as the qualified intermediary, or provide tax or legal advice. Those determinations remain with independent professionals.