1031 Exchange reimbursement of previously paid EMD/DD

[Anand Narayanan]

Hello Experts - Hoping you can help me with this please. 

I have a 1031 exchange and identified 2 replacement properties. One of the properties I got into a contract with the builder prior to setting up the 1031 exchange (prior to selling the relinquished property). In the process I have paid EMD and Design Studio deposit to the tune of 10% of the cost of the house. I am trying to get help from the builder and the closing attorney to reimburse me the EMD/Design studio deposits and get it from 1031 exchange during closing. But I am have been asked to check with the lender on how they will show this in the closing disclosure. My lender says they don't care how I come up with the downpayment since they are only worried about what they are lending to me.

Can someone suggest how I work with the builder and the escrow agent to make this happen please? Not sure how else I should try to explain to them. 

The replacement properties put together will be greater than the relinquished property value. I do have an 'opportunity' to offset some of the capital gains with capital loss I incurred before. Question is whether I should invest all of the 1031 proceeds in the 2 replacement properties or try to find more replacement properties or hang tight for the market to settle down by offsetting the capital gains with capital loss? My current area of focus is the Triangle area in North Carolina. 

Thank you so much in advance.