Why agents care
The QI must be engaged before the relinquished property closes. Agents who raise this at listing prevent failed exchanges.
Glossary term
Qualified intermediary
A qualified intermediary (QI), also called an exchange accommodator, is an independent party that holds the proceeds from the sale of the relinquished property and uses them to acquire the replacement property, so the investor never has receipt of the funds. The QI also receives the written identification of replacement property.
Example
Example: the investor signs an exchange agreement with a QI two weeks before closing. At closing, proceeds go to the QI instead of the seller.
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Questions by topic
Qualified intermediary: common questions
Can my agent or attorney be the QI?
Generally not if they've acted as your agent recently. Disqualified persons rules apply. Use an independent QI.
When must the QI be engaged?
Before the relinquished property closes.
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