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Guide

How to choose a qualified intermediary.

There is no federal license for qualified intermediaries, and the choice matters because the intermediary holds your sale proceeds. What to compare, and the evidence worth asking for.

Updated September 30, 2026 · Reviewed by onezero3one professional staff on September 30, 2026

onezero3one is a qualified intermediary, so we have an interest in your choice. This guide sticks to questions any provider, including us, should be able to answer with evidence.

Choose on controls and evidence, not on reassurance. The questions that matter are whether the intermediary is eligible to act for you, how and where your funds will be held, who can release them, what protection exists if something goes wrong, and what the agreement says about fees, interest and cancellation.

1. Eligibility: some people cannot be your intermediary

The regulations exclude anyone who has acted as your employee, attorney, accountant, investment banker or broker, or real estate agent or broker within the two years before the sale, and certain related parties. Services connected with exchanges themselves, and routine title, escrow or trust services by institutions, do not count. So your long-time accountant generally cannot be your qualified intermediary, but a title company that only handled closings for you may be able to.

2. Where the money will sit

Ask for the bank, how the account is titled, and whether your funds are separate from the company's own money and from other clients' funds. Pooled accounts are not necessarily wrong, but you should know. The largest losses in this industry have come from intermediaries that commingled or invested client funds and could not return them when purchases closed.

3. Who can release it

Ask how many people must approve a disbursement, and how wire instructions are verified. A process where one person can send your funds anywhere on the strength of an email is a risk, however trustworthy that person is.

4. Protection if something goes wrong

Ask whether the intermediary carries a fidelity bond and errors-and-omissions insurance, and ask for the certificates. Understand the limits: a bond may be far smaller than your exchange, and deposit insurance, where it applies at all, has per-depositor limits that large exchanges exceed.

5. State rules

California, Colorado, Connecticut, Idaho, Maine, Nevada, Oregon, Virginia and Washington have laws on exchange facilitators, including licensing in some and bonding, insurance and fund-handling rules in most. If your property is in one of them, ask how the intermediary meets that state's requirements.

6. Fees, interest and cancellation

Compare the whole agreement: the base fee, per-property and wire charges, who keeps the interest, and what is charged if the exchange is cancelled. See what to ask about fees.

7. Fit for your transaction

Not every intermediary handles every structure. Reverse and improvement exchanges, related-party transactions, multiple properties and partnership situations need specific experience. Ask directly whether the intermediary handles your kind of exchange, and how often.

Red flags

  • Reluctance to put the fee, interest terms and custody arrangement in writing before you sign.
  • Wire instructions that arrive or change by email alone.
  • Claims that funds are "fully insured" or "guaranteed" without explaining how.
  • An intermediary who is also acting as your broker, attorney or accountant.
  • Pressure to sign the exchange agreement after your sale has closed.

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