If you did something like this and still had the other $60000 left then your exchange would still be valid but you would simply owe tax on the $60000 leftThere is a critter called an "improvement exchange" that could accomplish everything you want but it is much more expensive.

They know the alternative is a hot hot summer of misery.Do not buy retail units and provide them with 'warranty'.  

Is the right document to use a quit claim deed or a general warranty deed?

@Russell Brazil I am not sure if the above satisfies you and is a valid solution for agents. 

Definitely do not accept a quitclaim deed, you need a warranty deed.

This will get the work done and no one will abandon the project.HOPE THIS IS OBVIOUS:check with the state for a valid contractors license and existing BOND.ask to see the bondIf you use a GC, make sure the subs are licensed too (have the GC get personal & business name + license number and get that emailed to you.) 

. - Thinking in terms of getting your principal back is certainly valid in some investment, but it's not usually how real estate investors think, because when you invest in a property, that money isn't gone, it's just changed from a cash asset to a real estate asset.

A deed has to have consideration to be valid even if it is for administrative purposes which this on seems to beMy guess is this property was an FHA loan that was foreclosed on and BofA was collecting on the FHA insurance with HUD and transferred to them.  

If you have that language lurking somewhere, you still have a valid and enforceable contract, including agent compensation unless the agent is fired for cause.I'm just guessing, but if you signed a purchase agreement in July and still did not have short sale approval by October, the agent did not do his/her job properly.

Giving them valid reasons is a courtesy but you don't have to try to prove it.