1031 Exchange with Family Member

[Denise Kwok]

In search of some clarification re: 1031 exchanges.  If my parents are selling an investment property for $1,000,000, and they'd like to purchase a single family home for $1,200,000 to rent to me at market value, is it possible for me to pursue a mortgage on the $200,000 difference?  Or would my parents have to take on the mortgage themselves?

Many thanks in advance.