### Question
How is the term qualified replacement mortgage defined?


### Answer
The term **qualified replacement mortgage** is defined in *26 U.S.C. § 860G* as the following:

> any obligation—


(A) which would be a qualified mortgage if transferred on the startup day in exchange for regular or residual interests in the REMIC, and


(B) which is received for—


(i) another obligation within the 3-month period beginning on the startup day, or


(ii) a defective obligation within the 2-year period beginning on the startup day

#### Citation:
  - *26 U.S.C. § 860G*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter M-Regulated Investment Companies and Real Estate Investment Trusts > PART IV-REAL ESTATE MORTGAGE INVESTMENT CONDUITS**

