Hi, BPers

I have a question on purchasing a Quad using my 1031 exchange account and wonder whether I could get some inputs from you all!

I just sold two properties and put the proceeds in 1031 exchange accounts. The deadline to identify replacement properties is 12/31/2020. I was planning to use the proceeds to purchase a Quad. But the Quad turned to to have four separate Tax IDs, so that I could not purchase it with my low-interest rate, fixed-term residential loan. As a result, we terminated the contract. Now, it seems we have two options:  

1. I list this Quad as one of three replacement properties for my 1031 exchange and wait on the seller to combine the tax ID (the earliest time for him to start the process is 1/1/2021, after the expiration of the identification period for my 1031 exchange). Once it is combined, we could resume the transaction. The seller is willing to continue the process as well, as I already inspected the unit and agreed on the price. The pros for this option are that I still could look for other deals on the market before the identification period is due (i.e., we are not tied to each other) although I think this Quad is the best deal I have seen so far; The cons are that the seller still can sell the Quad to any highest bidder after the tax ID is combined;  and I may need to pay taxes on my 1031 proceeds. 

2. we finish the transaction now by asking the seller to do a short-term seller financing (amortized for 30 years, but balloon at 1 year). I could combine the tax ID myself and refinance after that. The pros are that I will secure the property now, and don't need to pay taxes on 1031. The downsides are that if new challenges arise during (1) combining Tax IDs and (2) refinancing, I will be stuck. I did mention about the long-term seller financing but the seller was not willing to do so as he wants to do 1031 exchange as well. 

So my questions are:

1. Which option do you think is overall better?

2.  How long does it usually take to combine tax IDs from four unix in a fourplex?

3. Is a minimal 6 months of holding period required for refinancing? The interest rate that my loan broker gave to me is 3.125%, Will the interest rate for refinancing be much higher?

4. Is it possible to change 1031 exchange company in the middle of a deal? It seems that my current company is extremely strict on the rules (i.e., 45 days to identify), which created a lot of stress. 

5. Are there other critical points that I am missing here?

Your inputs will be greatly appreciated!

Lee