Total purchase price vs cash in - Which count (or do both)

[Michael Wolffs]

Situation: I own a three family house, fully rented, through an LLC. I'm the sole member. The LLC didn't take any debt to find the purchase or rehab. I have some personal LOCs I've used, plus significant cash. I have approximately $560K in the project. By comps I've gotten from a realtor I've worked with, the current value of the property is about $800K. If I sell out, I'll get all the cash, minus transaction costs, so likely >$700K.

Let's say I do sell out of this, and buy a $1.2 million dollar property on a 75% LTV mortgage. I'd need $300K + transaction costs. What can I do with the other $300K+ proceeds from the first sale. Is this trapped in the exchange? What happens if the total transaction of the purchase is greater than the sale, but the cash in of the purchase is less than the cash out of the sale?