Does Location of the 1031 Qualified Intermediary Matter?
Posted by Andy Gustafson on Mon, Jul 26, 2010
In a word, it depends. When selecting a Qualified Intermediary (QI) or Accommodator in a 1031 exchange, there are far more important factors to consider than location.
If the perception is that the QI must have an office in your city or state, then for peace of mind, the QIs location is a show stopper or a requirement of the 1031 exchange.
There are no Federal laws restricting QIs from facilitating 1031 exchanges across state lines. In Idaho and Nevada, state laws require QIs to follow certain procedures legislated to protect the Exchangors. State regulations in California, Oregon, Washington, Colorado and Virginia require QIs to maintain a $250,000 Errors and Omissions insurance policy and either use a Qualified Escrow account or maintain a $1,000,000 Fidelity Bond.
As a byproduct of the internet, I rarely meet clients personally. Our Atlas 1031 Exchange website, classes taught and professional referrals are the primary means of introduction. Phone conversations, word of mouth and web site content can and does provide peace of mind and trust for Exchangors to engage our services even though Atlas 1031 Exchange is located in Indiana and not in the state or city of the Exchangor.
So does it really matter where the QI is located? For 99% of Exchangors, the answer is no.
