Qualified Intermediary Coordination

A flat fee looks simple until you ask whether it covers a single relinquished property and a single replacement property, or whether reverse exchanges, multiple identifications, or a replacement property in Mississippi trigger additional charges. Some QI agreements also earn float income on the exchange funds during the holding period, which is standard practice but should be disclosed, not buried in the account agreement's fine print.

We ask every QI candidate for the actual fee schedule and the actual funds-security language, including whether funds sit in a qualified escrow, a qualified trust, or a commingled account, since that distinction affects what protection the investor has if the QI has financial trouble mid-exchange.

We also confirm how the QI handles a change to the identification list, since some investors revise their candidates after the initial forty-five day notice goes out and discover the QI charges an unexpected amendment fee for reissuing documents. A fee schedule that lists only the base exchange charge without naming amendment fees, wire fees, or rush-processing charges for a tight Memphis closing timeline is an incomplete quote. We ask for a written fee schedule covering every scenario reasonably likely to occur before the exchange closes, not the baseline case alone the QI's marketing page describes.

The whole point of the qualified intermediary is to prevent the investor from ever touching or controlling the sale proceeds, because actual or constructive receipt of those funds can disqualify the exchange. That means the exchange agreement, the assignment of the sale contract, and the closing instructions all need to route through the QI correctly, with the investor's name never appearing as a signatory on the funds themselves. A Memphis closing attorney who has not coordinated with the specific QI before is a place where this can go wrong through simple unfamiliarity, not bad intent.

This is also why the exchange agreement should explicitly restrict the investor's ability to receive interest or other benefit directly from the account before the replacement closing occurs. Some QI agreements let interest accrue in ways that can raise constructive receipt questions if not documented correctly, and we confirm that language reads the way the investor's attorney expects before signing rather than after funds have already moved.

Memphis industrial deals near the FedEx superhub or along the rail corridors served by the area's Class I railroads often close on tenant-driven schedules that do not bend for exchange paperwork. When a relinquished property or replacement property sits inside one of those logistics-driven timelines, the QI coordination has to track both the 45-day identification deadline and whatever operational handoff the tenant or rail user requires, since those two clocks do not automatically line up.

Before we consider a QI relationship properly coordinated for a Memphis exchange, the file needs to show:

• The actual fee schedule, including charges for reverse exchanges or multiple replacement properties
• Where exchange funds are held and under what security arrangement
• Signed exchange agreement and assignment documents routed correctly through the QI, not the investor
• A funds release timeline matched against the replacement closing date
• Confirmation the QI has closed exchanges involving both Tennessee and Mississippi property before, if the exchange spans the state line

Some investors pick a QI purely on the lowest quoted fee, which can work fine or can leave gaps in funds security and document handling that only surface under pressure near the deadline. This coordination work does not replace the investor's own legal review of the exchange agreement. It is the layer that confirms the QI relationship is actually built to hold up when the closing calendar gets tight.