Exchange Agreement and Joint Closing Instructions

Exchange Agreement and Joint Closing Instructions

Exchange agreement and joint closing instructions agreement, normally involves three parties; first party, second party and the third party, regarding a real property.  First party is considered as the owner of the property as mentioned in the documents. The second party is considered as the purchaser of the property from the first party (seller). In return of the purchase, the purchaser demands an exchange agreement to the seller. The third party is the person who sells the outright of the property to the second party (purchaser).

With the promises and the knowledge of all the three parties, this agreement takes its position in the joint closing of a particular property. The seller first exchanges the property rights to the purchaser and further the interests of the property are also exchanged in contact with all three properties with money that is paid by the purchaser to acclaim a particular property. Additional and supplemental joint closing instructions are also to be followed by all the three parties. All the funds and payments that will be mentioned in this document are to be paid by the purchaser of the property and it is deposited with the knowledge of the closing client. Hence, the names and address are also noted in the document of all the three parties for a formality record of the land or property. So, it is compulsory for all the three parties to agree and maintain this record until further steps. This document is passed on by the signatures of all the three parties.

Exchange Agreement And Joint Closing Instructions

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Exchange agreement and joint closing instructions.

This agreement is made and entered into [date], between _________(First Party), _________(Second Party) and _________(Third Party).
The First Party is the owner of certain real property referred to as Parcel “A” the legal description of which is attached here as Exhibit “A.”
The Second Party wants to purchase Parcel “A” from the First Party but the First Party wants to exchange Parcel “A” for other property of like kind and wants the exchange to qualify for tax deferred treatment under Section 1031 of the Internal Revenue Code.
The Third Party wants to sell outright the property described in Exhibit “B” attached here.
In consideration of the mutual promises and covenants expressed here, the parties agree to sell, exchange and purchase as follows:
(A). In order to effectuate the goals of the parties, the Purchase and Sale Agreement for Parcel “A” and the Purchase and Sale Agreement for Parcel “B,” attached here as Exhibit “C” and “D” respectively, are amended and modified by the provisions of this Agreement. First Party is exchanging its interest in Parcel “A” for Parcel “B,” with Second Party who is acquiring Parcel “A” and is acquiring Parcel “B” from Third Party for purposes of exchanging Parcel “B” with First Party for Parcel “A,” and Third Party agrees to transfer Parcel “B” to Second Party and will be paid for Parcel “B” from the proceeds of the transfer of Parcel “A” to Second Party and undertakings more fully set out in the attached Exhibits “C” and “D.”
(B). The parties agree to execute such additional or supplemental instructions to these as may be necessary to consummate this transaction. This Exchange Agreement and all executed documents and the funds described here and/or in Exhibit “C” and “D” here will be deposited with _________ Closing Agent. For the convenience of the parties, if necessary or desirable, originals of this Agreement may be executed in counterpart by the parties and assembled in closing into one agreement bearing the signatures of all parties.
(C). For purposes of prorations, the date of closing shall be [date]. All taxes, interest, reserves and other liens on Parcel “A” and Parcel “B” shall be prorated as of the closing date.
(D). Third Party agrees to sell and Second Party agrees to purchase Parcel “B,” the exchange property, for a total purchase price and on such terms as set out on Exhibit “D.” Third Party understands and agrees that Second Party is exchanging Parcel “B” to First Party under the terms of Paragraph E below, and First Party and not Second Party is responsible for the purchaser’s obligations set out on Exhibit “D.” For the sake of convenience, all parties agree that at closing and upon payment into closing Second Party is relieved of any and all liability or responsibility with regard to Parcel “B,” the exchange property. In order to save additional documentation and additional closing costs, it is agreed that the Third Party shall directly convey to the First Party the Parcel “B” property.
(E). First Party, in consideration of the conveyance to First Party of Parcel “B,” the exchange property, agrees to exchange its interest in Parcel “A” to the Second Party under the provisions of Section 1031 of the Internal Revenue Code. Second Party will be credited with the purchase price of Parcel “A” on closing for the transfer of Parcel “B,” the exchange property, to the First Party.
(F). Third Party shall pay all seller’s closing costs and expenses, recording fees, excise tax, and one-half of the closing fee in connection with Parcel “B,” the exchange property. Second Party shall pay purchaser’s one-half of closing fee and purchaser’s normal closing costs in connection with Parcel “A.” First Party shall pay all seller’s closing costs and expenses, recording fees, excise tax, and one-half of the closing fee in connection with Parcel “A” and shall pay purchaser’s one-half of closing fee and purchaser’s normal closing costs in connection with Parcel “B.”
(G). It is understood and agreed that the contingencies contained in Exhibit “C” and in Exhibit “D” have been satisfied.
IN WITNESS, the parties here have executed this instrument the day and year first written above.
First Party:
_________
Address:
_________
Second Party:
_________
Address:
_________
Third Party:
_________
Address:
_________