House Swap

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DEFINITION of 'House Swap'

A practice in which the owners of a home allow the use of that property in exchange for the use of another party's home. A house swap does not involve the sale of a home; rather, it allows a homeowner to "borrow" someone else's home. It can be some on a temporary or semi-permanent basis. House swaps typically involve an exchange in property use for the purpose of vacation. They are also options for homeowners who need to relocate due to a change in job, but are unable to sell their home due to a depressed housing market.

INVESTOPEDIA EXPLAINS 'House Swap'

Homeowners who do not want to give up a piece of property but wish to stay in another area may enter into a house swap agreement. For example, the owner of a condo in Miami may enter into a house swap agreement with the owner of a home in Denver. The Miami homeowner may like to ski in the winter, while the Denver homeowner may like to visit the beach in the winter.




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RELATED FAQS
  1. How does an entrepreneur choose a business structure?

    Swaps are derivative contracts between two parties that involve the exchange of cash flows. Interest rate swaps involve exchanging ... Read Full Answer >>
  2. When was the first swap agreement and why were swaps created?

    Swap agreements originated from agreements created in Great Britain in the 1970s to circumvent foreign exchange controls ... Read Full Answer >>
  3. How do earnest money deposits work in a short sale?

    Earnest money is required in a short sale transaction, although the funds do not necessarily have to be deposited into an ... Read Full Answer >>
  4. What is a fiduciary deed and when is it useful?

    A fiduciary deed is used to transfer property rights in a sale when a fiduciary must act as an executor of the sale on behalf ... Read Full Answer >>
  5. How are swap agreements financed?

    Since swap agreements involve the exchange of future cash flows and are initially set at zero, there is no real financing ... Read Full Answer >>
  6. What are the risks involved with swaps?

    The main risks associated with interest rate swaps, which are the most common type of swap, are interest rate risk and counterparty ... Read Full Answer >>
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