CoopAndCondo.com - Addressing the realities of Residential Real Estate

From the Law Office of Ronald H. Gitter, Esq.

Residential Realities March 2011

       
Residential Realities March 2011

March 31, 2011: The Troublesome Transaction

Now that activity in the New York City real estate market is increasing, so is the difficulty of actually getting a deal done. Although brokers seem to be using two favorite tools in the broker tool box with more frequency: silly deadlines and multiple bids, the time and effort required to complete a transaction has increased geometrically. From difficult buyers to short appraisals to impossible underwriting guidelines, each component has taken on its own set of complexities and can cause a closing to be delayed or not to occur.

Personal Journal

Under the Henry Kissinger rule that even though you're paranoid, it doesn’t mean that people aren’t out to get you, the level of distrust between the parties is reaching new highs as the never ending stream of scary real estate statistics continues (more on that shortly). As buyers search for the bottom, like prospectors looking for gold, the buyer’s lack of confidence that he or she is purchasing at the “right price” creates anxiety not just for buyer and seller, but for all of the professionals who shepherd them through the process.

Slam Dunk Leaves the Lexicon

The above being said, there are deals of all sizes getting done quickly, but not easily. As one of my real estate mentors loved to say, “it’s rough out there” and that’s true now more than ever. So as we finish up the first quarter, many of us are fortunate enough to say, yes things are better...but the so called “slam dunk” may be a thing of the past.

March 27, 2011: A Borrower Takes a Walk in the Mortgage Twilight Zone

On a long car trip yesterday, my wife read aloud Joe Nocera’s powerful and painful story of a bystander caught in the cross hairs of a special agent for Internal Revenue Service, who had watched one too many NCIS episodes. Through what could only be described as pointlessly diligent investigative work, including the use of an “attractive female undercover agent” wearing a wire, the agent discovered that said individual had obtained two “liar loans”, thereby violating federal lending laws. Long story short: that individual is now serving 21 months in a low security prison for fraudulently misstating his income on those loan applications and has to make significant restitution to Countrywide, now owned by Bank of America. His mortgage broker, also prosecuted, was given a reduced sentence of 10 months for testifying against his client, the borrower. Cue the Rod Serling voice over…

Not the Loan Modification We Had In Mind

The article is fascinating because the individual caught in the web fit the profile of many Americans: struggled with personal demons, overcame those demons, turned his life around and accomplished great things (including an ultra-marathon across the Sahara desert). Not the sleazy real estate manipulator who got what he deserved, but someone who did what thousands were enthusiastically encouraged to do during that crazy period of the past decade. As Nocera points out in great detail, the Government players in this story went to incredible lengths to prosecute this borrower and to a make a philosophical point about the banking crisis. But with so many bad guys in the mortgage debacle to choose from, is this the person the Government needed to punish to let us know “they get it” about what went wrong with the nation's lending practices?

March 22, 2011: The Rent Stabilization Show is About to Begin

Places Everyone...

As the spring season begins, and the thaw of the real estate economy continues, the curtain is about to rise on one of New York’s favorite morality plays: whether or not to extend rent stabilization. As pointed out by Eliot Brown in the Wall Street Journal yesterday, the regulated rent law will expire in June with the usual battle lines being drawn. As we learn over and over again, it’s usually not about the best interests of the public, but often about the political climate at the time our legislators are faced with a major decision. As the cast of characters in this drama takes the stage in Albany, the ending seems somewhat predictable.

A Good Run by Broadway Standards

Although the soliloquy of the real estate lobby to eliminate rent protection for 1,000,000 apartments will begin shortly, it’s hard to imagine that the political will exists to bring all rents to market in the current fragile economy. Grandma thrown out in the street doesn’t play well. In fact, there is a good shot that the rent ceiling of $2,000 for deregulating an apartment, which has not changed since 1993 (a very good run), will increase. But everything comes with a price tag. Extending rent stabilization will have to be connected to something that benefits the real estate industry and that something is probably a renewal of a watered down version of the expired 421-a tax abatement program, the mother’s milk of condo development.

Is it Comedy or Tragedy?

So with the expected plot twists and turns as the story unfolds, it should get interesting. Sit back, relax and enjoy the show.

March 17, 2011: Is Ilsa Winding Down?

It’s getting painful for developers hoping to escape the jaws of ILSA, a forty-year old statute that requires disclosures about development projects, originally aimed at land sales. As an escape hatch from new construction condo contracts signed at the height of the over-heated New York residential real estate market, lawyers found the statute and asserted its applicability as a means to get out of unwanted contract obligations. As each decision is rendered by the courts, the most recent by the Second Circuit, the chances of ILSA not being applicable to these developments is slim and none. Although the decision could theoretically be appealed to the Supreme Court, that doesn’t seem likely given the oversized cost to take on such an appeal, the odds of success and the limited nature of the problem.

Since a purchaser’s right to revoke a contract on grounds that the developer failed to comply with ILSA must be given within two years from the date that the contract was signed, most of the contractual time periods where ILSA might have been asserted have expired. In other words, all of the ILSA cases that could have been filed, probably have been filed.

Dollars and Sense

With an improving real estate market and with an ever increasing hurdle to jump over for developers, economics may dictate whether it makes any financial sense to continue to fight the ILSA battle. Look for a Roberto Duran moment: no mas…

For more, see "IlSA: Not the Name of a Hurricane" and "More ILL from ILSA".

March 11, 2011: Banks Get Funky--The B Side

Banks and Borrowers Still Can't Get Their Groove On

Almost a year ago, in my post “Banks Get Funky”, I wrote about how difficult the lending process had become for residential borrowers. Unfortunately, not much has changed. In fact, lenders continue to move the underwriting goal post with the result of causing closing dates to be pushed back, often to the disappointment and frustration of both buyer and seller. Here are six issues that buyers and brokers need to keep in mind as co-op and condo transaction volume finally starts to increase:

The Pre-Approval Letter

It’s time for this document to go the way of the palm pilot. Although brokers often encourage sellers to accept an offer because their customer has multiple pre-approval letters, this initial review of the buyer is basically useless. Both the buyer and the co-op or condo must withstand the full review process by the Dr. Evil of the lending process, the underwriter. So waiving a pre-approval letter as a reason to accept an offer doesn’t really provide much comfort. To prove my point, take this scenario for a test drive: The next time someone lauds a pre-approval letter, ask the buyer if he or she is willing to waive the mortgage contingency. That will tell you everything you need to know…

Good Faith Estimate

Going from the ridiculous to the sublime, as a result of changes in federal law in January 2010, the good faith estimate has become a very important document. Accuracy in disclosing closing costs is essential, as an understatement can cause banks to withdraw their underwriting, unless someone (usually a mortgage broker or title company) absorbs those misstated costs. There are specific tolerances for mistakes and some items, like incorrect origination fees, can’t be remedied. Buyers and their attorneys should carefully review this document, which has to be delivered three business days after the loan application is submitted.

Insurance Requirements

Banks are now often requiring condo purchasers to obtain a “walls in” policy also known as a “HO-6”. Buyers should be in touch with an insurance broker early in the underwriting process to insure the required coverage is available. That’s the easy part. Lenders are carefully reviewing the insurance coverages maintained by co-ops and condos. The bugaboo de jour is the building’s fidelity bond coverage, which sometimes is below current guidelines. The buyer’s attorney should obtain the co-op or condo’s insurance declaration page as soon as possible to make sure the building will satisfy the bank’s lending requirements. Get this loan condition cleared as soon as it rears its ugly head on the commitment letter.

Banks Require Accuracy

Forwarding the bank a copy of the fully-executed contract to initiate underwriting continues to be standard operating procedure. But banks are now obsessing over minor mistakes, cross outs and handwritten changes. Recently, I was asked to prepare an amendment to a contract because the zip code of the property being sold was wrong. I think that says it all.

Require a Funding Contingency

More than ever, contracts should include a funding contingency in addition to a mortgage contingency. Particularly with low occupancy condos that are relying on FHA financing, the possibility that a bank could initially provide a loan commitment and then change its mind and withdraw the financing, continues to be a real possibility. A buyer should not be left in the lurch if the bank sours on the co-op or condo and the financing goes away.

As Long as They Don’t Stay Over

Parents are often stepping up to help out the kids with their first purchase. In many cases, the parents would prefer to act as guarantor on a co-op or condo loan, rather than be named as a co-purchaser. Banks, however, usually require the parents to “be in title” with their offspring and will not accept only a parental guaranty of the loan. Buyers would be wise to investigate a lender’s collateral requirements before making an offer based upon a parental loan guaranty that very few banks will accept.

Residential Reality: There’s More in Store

Besides the usual hi jinx that you can expect on April 1st of any year, this one will be special: many provisions of the Frank-Dodd financial reform law will go in effect on that day with interesting and unintended consequences. To be continued…

March 10, 2011: An Ode to Willie

Coming back from a dinner last night, my wife informed me that a doorman at our former co-op had passed away. Willie Shuler was our late night guy. Often he would show up before his shift to hang out in front of the building and talk to the residents before he put on his uniform and assumed his post in the lobby. He was always happy to see you and catch up, ask about a family member or greet your dog with a treat from the desk. It was part of the DNA of our cooperative life.

Buildings are like organisms that expand and contract as the day begins and the day ends. Many things take place on that overnight shift to which the sleeping residents are oblivious. But not to Willie. He was gatekeeper, counselor and confidant to those in need, holding court throughout the night. Many times I witnessed sotto voce conversations at his station in which advice was given and taken.

So I say goodbye to a friend who moves on to a better place…

 March 8, 2011: Digital Due Diligence

Until folks realized that New York City’s ACRIS system could be data mined to develop all kinds of statistics about real estate sales in Gotham, the public relied almost entirely on the quarterly and annual sales reports provided by the large brokerage firms. Now a number of online portals have created complex trails of transaction analysis bringing more and more transparency to answer Ed Koch’s famous question “How we doing?”

Digging UrbanDigs

One such website, UrbanDigs, recently launched by Noah Rosenblatt, is on a mission to both report that data and to understand it as well. The latter goal often not so easy to accomplish. Yesterday’s post by Noah, revealed a detail that many brokers know, but the public does not. Sales data that appears on ACRIS can reflect transactions that occurred as much as 90 days ago. How could that be? We’re dealing with a governmental filing service. The number of transactions in any given day may increase, but the number of governmental employees recording those transactions into the system remains the same, and in our current budget scenario, may even be going down. So there is a lag time between the date a closing takes place and the date that the closing becomes public knowledge, “as a matter of record”. Looking at the statistics, one realizes that the sales data on any particular day is stale and doesn’t reflect the state of the real estate market on that day. It’s like driving a car, only using the rear view mirror.

What the Public Doesn’t Know

The piece of the puzzle not immediately available to home buyers is the number of contracts signed on a particular day. Although not accessible directly, sites such as UrbanDigs are processing that information provided by internal brokerage listing websites, to determine with more accuracy exactly how the real estate market is doing on a particular day, week or month. Taking the recorded sales data and linking it to the signed contract numbers starts to produce a relatively accurate analysis of how the real estate market is actually doing without relying on spin, marketing efforts or glossy reports. Now we’re getting somewhere…

March 6, 2011: A Visit to 8 Spruce Street

A Lunch Date Sparks Memories

An unexpected invitation to lunch with the Dean of my law school rekindled memories of my three years in lower Manhattan. When I attended New York Law School in the early seventies, it was housed in a funky office building at the corner of Worth and Church Streets. At the time, one would describe the location as…the middle of nowhere. The Odeon, now a few doors down, was still to be born out of the Tower Cafeteria. I remember leaving school one day and turning to my friend and asking, “where the hell are we?” Turns out the middle of nowhere was to become Tribeca and the law school, reinvented as a brand new structure on West Broadway, finds itself at the epicenter of Manhattan hipness. Stuff happens.

If Paul Goldberger Likes It…

With downtown on my mind, I happened onto Paul Goldberger’s New Yorker Review of 8 Spruce Street, the new Frank Gehry designed rental building that opened for business a week ago. The article inspired a visit. This massive structure, rising 76 stories, with 900 apartments in various configurations, has a wavy fabric-like stainless steel skin, that towers over City Hall, Pace University and the Brooklyn Bridge. As he points out in the article, a building’s design is either controlled by the developer or by the architect, and you know who won in this case. Ordinarily, a building with this level of architectural pedigree and over the top amenities, would only be available to those with very large bank accounts, but not so in this case, at least to some extent. If you can pay the pricy rental freight, it can be yours (with a free month’s rent to boot). And if Goldberger gives it an enthusiastic thumbs up, which he did, it means something.

The Changing Landscape

In the old days, it would have been impossible to imagine a high-end rental building rising up from that weird patchwork of tiny streets and alleys, parking lots, take out places and electronics stores that surround the entrance to the bridge and the FDR. And in many respects, not much has changed in that specific location. Yet planted in the middle of all those forgettable buildings, is this gigantic structure that dominates the skyline much like the Woolworth Building must have 100 years ago. Is it a game changer for that neighborhood? As the recession winds down, the folks at 8 Spruce Street hope so.

March 1, 2011: Having a Blast on Second Avenue

At East 70th Street and Second Avenue, one of the epicenters for the construction of the Second Avenue subway, stands a restaurant I’ve frequented with my friends in that neighborhood on many occasions. As the construction of the subway works its way down Second, the heavy machinery moves along with it, together with lots of guys in hard hats and an unexpected dining experience.

"Incoming"

As we were entering the crowded restaurant, three horn blasts sounded. The gentlemen holding the door as we walked in stated without much emphasis, “the dynamite’s about to go off”. From the resigned look my friend’s face, a look that said, here we go again, it was clear that he was not kidding.

The horn sounds again. Folks in the restaurant seem to pause. A few seconds later, what can only be described as a significant underground explosion takes place, shaking the building and the patrons therein. Nervous laughter, relief that we all made it through, then back to dinner. Several minutes later, the restaurant’s owner offers a complimentary aperitif of crème de cassis with some blue stuff in it. “We hand these out after every blast”. Talk about 3-D.

Subway tunnels apparently don’t dig themselves. It is an almost incomprehensible undertaking that is impacting life along the Avenue and will for many years to come. Two things were abundantly clear from our dinner: cutting subterranean tunnels out of bedrock 100 feet below the street surface takes dynamite… many, many blasts of dynamite and many shots of crème de cassis, as New Yorkers toast their legendary coping mechanism.

Simplifying the complexities of Cooperative and Condominium transactions in New York City

Asked and Answered

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I don’t smoke, but the smell of smoke is wafting into my apartment from my neighbor. Is there anything that can be done to remedy this condition?

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I’m selling my co-op tomorrow and my bank attorney has not yet received the stock certificate and proprietary lease from my bank. Will the closing have to be adjourned?

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The seller has indicated that there was a leak in the bathroom from the apartment above that has been repaired in all respects? Can I rely on seller’s representation to that effect in the contact?

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My mortgage lender has informed me that the cooperative in which I am purchasing an apartment has inadequate insurance coverage and has requested that the co-op increase its coverage to meet the bank’s new minimum requirements. Can the bank withdraw its underwriting due to a lack of insurance coverage by the co-op?

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The commitment letter included a condition that my loan was subject to a “second review” by the investor to whom the loan will be sold. Has my commitment letter been issued?

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Can I purchase my co-op in the name of a trust?

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Can I allow the seller to remain in possession after closing?

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There’s a repair needed in the apartment that the Seller promises to remedy after the closing. Is that a good idea?

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Do I care who the bank attorneys are?

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Do I have to go to the closing?

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One of the conditions in my loan commitment states that the monthly maintenance cannot increase by more than five percent? Is that a problem?

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Can I have a roommate after I purchase my co-op apartment?

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Can I undertake renovations before the Closing?

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Do I need a home owner’s insurance policy for my apartment at the time of my closing?

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Should I let the broker do the walk through?

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Once I get a loan commitment, is my loan approved?

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When it comes to purchasing an apartment, what exactly is due diligence?

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Do I have to let the maintenance people in to fix a building system?

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Does my dog have to be interviewed by the Board?

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Is buying an apartment in a small building a good idea or a bad idea?

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Can I fudge on my numbers in my financial package to the Board?

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Should I use a mortgage broker or should I go direct to a bank?

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Should I have the apartment inspected before I sign the contract?

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Do I Really Have to Give the Board My Tax Returns?

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I am purchasing an apartment with extensive landscaping on the terrace. Can the co-op or condo make me remove landscaping that was existing at the time of my purchase?

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I have an opportunity to buy a garage space, but the sponsor is calling the arrangement a “license” rather than a “purchase”. Does that matter?

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We are considering an apartment that will require us to move the bathroom to another location in the apartment. Is such a move possible?

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The seller’s bank can’t locate the stock and lease for the co-op closing. Can we still close?

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The broker told me that I can adjourn the closing for 30 days? Is that correct?

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The Offering Plan for my condo indicates that the apartment has a “lot line” window. Is that a problem?

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My dog bit someone in the lobby and I have been notified that if it happens again, my dog will have to go. Does the Board have the power to restrict me from having a pet?

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There is an unobstructed view from the apartment I am considering, but there is a vacant lot directly in front of that side of the building. Is that reason for concern?

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The Managing Agent called and it looks like my finances will not be sufficient to get Board approval. Is there anything I can do?

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The managing agent has had our application to purchase a cooperative apartment for three weeks and nothing has happened. Is there anything we can do to move things forward?

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We are considering an apartment in a co-op where the sponsor still owns units. Is that a problem?

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The seller’s apartment presently has a storage unit. Does the storage unit transfer with the apartment?

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We’re closing in three weeks, but our lease is up next week. Can we move in before the closing?

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I just did the walk through on the purchase of a sponsor unit and we have an extensive punch list. Will the punch list be completed by the time of closing?

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I’m buying an apartment from a sponsor and the Offering Plan requires me to pay the sponsor’s transfer taxes and attorneys fees. Do I have to?

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The purchase price of my apartment is over $1,000,000.00. Is the transaction subject to the “mansion tax"?

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I’m selling my apartment, but I’m not a resident of New York State. Are there any special closing costs?

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We did the walk through and the apartment was filthy. The contract required the apartment to be “broom clean”. Can we complain at the closing?

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I have to sell my apartment in order to afford the new one I’d like to buy. Can the contract be contingent on the sale of my existing apartment?

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I’m a famous person (no, I really am) and I really don’t want my financial information given to eight strangers on a co-op Board. Is there a way to avoid that?

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I’m the executor of the estate of a deceased shareholder. Do I have to go to the closing?

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I just graduated law school and have a job with a large law firm. I have a significant salary, but no liquidity or significant assets. Will I be able to buy a co-op?

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The listing indicates that the apartment has “roof rights”. How can I be sure?

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When buying a condo, is it worth the time and effort to get an assignment of the seller’s mortgage?

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The Seller removed an expensive chandelier right before Closing. Is that permitted?

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My husband and I found an apartment we love, but there’s a bidding war. Should we participate?

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We love the apartment, but the building has bad financials. Should we go ahead?

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My closing is in December, but the lease for my apartment does not expire until the following March. What do I do with my lease?

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We are buying a condo, but we have a delayed closing as the seller has a tenant in place for the next six months. We will be able to retain our loan commitment for an extended period of time?

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Should my husband and I take title as tenants by the entirety, tenants in common or as joint tenants?

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When a gay couple buys the shares of a cooperative or buys a condominium apartment, what is the best way to hold title?

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I have not been able to make my co-op mortgage payment for the past three months. If the bank declares my loan in default, how long will it take before the bank forecloses on my apartment?

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A co-op owner asks: I have found that maintenance is usually higher in coops than in condos because of the contribution by the shareholders to the building's underlying mortgage payments. In condos, the unit owners only pay for real estate taxes and common charges for common areas. Will the monthly maintenance be reduced after the underlying mortgage has been fully amortized?

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Can a corporation or other business entity own the shares of a cooperative apartment?

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I’m buying an apartment in a building designated as a “landmark.” Should I be concerned?

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I am buying a co-op that needs major renovations. The super has offered to do the work at a significant discount. Is that a good idea?

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We just submitted the Board package and we realize that we neglected to disclose a lawsuit against my husband’s company, in which my husband is named as a defendant? The lawsuit is covered by insurance and my husband is indemnified from liability by his employer. Should we notify the managing agent and amend the purchase application?

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We are negotiating the contract and we just found out that there is a substantial assessment that will go into effect the month that we close on the purchase. Should the assessment be deducted from the purchase price at closing?

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The bank attorney was two hours late to the closing. Was that my attorney’s fault?

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I’m buying a cooperative apartment in Manhattan, but I move out to the Hamptons from June to the end of September each year. Will I be able to sublet the apartment each year when I’m away?

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I just got the purchase application package and it's twenty pages long. Should my broker be helping me with organizing the required documents?

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It’s the day before the closing and I just found out that the maintenance for the apartment is higher than the maintenance stated in the contract. Is that grounds to terminate the contract?

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The financials for the condo are more than a year out of date and there is a delay issuing the new financials. Should I be concerned?

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The contract requires “official bank funds” in the form of certified or official bank checks. Can I bring “official" checks from my brokerage account?

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My parents want to buy me an apartment while I’m in graduate school in Manhattan. Will a co-op allow me to purchase the apartment, if my parents are co-owners?

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I obtained sole ownership of my condo in my divorce, but the deed for the apartment is still in both of our names. Will my ex-spouse’s cooperation be required when I’m ready to sell the apartment?

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I just found out I have to pay a fee to have my mortgage recorded. Is that right?

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I am buying an apartment in a small building and I just found out that the elevator is being renovated and will be out of service for three months. Do I have to close if the elevators will not be operational on the closing date?

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My husband and I own a co-op and we would like to transfer the shares to an irrevocable trust that we recently created for estate planning purposes. Will our cooperative allow us to make that transfer?

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The seller is a foreign citizen and does not have a social security number. Does that prevent the seller from selling the apartment?

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An “assessment” was imposed by the co-op Board after the contract was signed. Is payment of the assessment the seller’s responsibility?

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There is a leak in my apartment and the Resident Manager is not being responsive. Should I call the Board president?

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I just bought an apartment and I am only refinishing the floors and repainting. Do I need the consent of the Board before I get started?

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The co-op I’m interested in is pet friendly and I have a dog. Is there any chance the Board could approve my application without approving my pet?

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We purchased our apartment in January, but our first mortgage payment is not due until March 1st. Why isn't the first payment due February 1st?

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I’m buying an apartment from a sponsor and the contract does not provide for a “mortgage contingency”. Is that a provision that I can negotiate into the contract?

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I am buying an apartment from a sponsor and the contract provides for the buyer to pay the sponsor’s transfer taxes and legal fees? Is that normal?

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I'm buying a condo and my attorney just ordered the "title report". What's a title report?

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There is a leak in my apartment and the Resident Manager is not being responsive. Should I call the Board president?

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My boyfriend and I are interested in buying our first apartment in a new construction condominium. Our mortgage broker tells us we should qualify for a 90% loan, but it will be a close call for the bank. The sponsor wants us to sign a “no contingency” contract. Is that a good idea?

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We are considering a condo purchase in a new development that is only 25 percent sold. There is a bank that has approved the project and will make the loan, but should we be concerned about the number of units that the sponsor still has to sell?

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We are buying an apartment that has been extensively renovated. Among other things, the size of the master bath was significantly increased. Can we rely on a representation in the contract that all required approvals were obtained from both the Cooperative Corporation and from the New York City Department of Buildings?

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We received a draft of the contract of sale for the cooperative apartment we are buying and our social security numbers are on the front page! Our attorney told us that we will have to provide our identification numbers to the managing agent for a credit check as a part of the Board package, so it’s not a big deal. Do we have to list our socials on the contract?

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The listing stated that the apartment was 1,100 square feet, but the appraisal measured the apartment at 900 square feet. Can we cancel the contract and get our money back?

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I'm about to pay off my co-op loan. What evidence will I have from the bank that the loan has actually been paid off?

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I am considering an apartment in a new construction condominium. There is park under development by New York City that will greatly enhance the value of the condominium when it’s completed. Although the sponsor’s salesperson indicated that the first phase of the park will be completed in the next year or so, the Offering Plan contains a “Special Risk” that states that the sponsor gives no assurance as to when, if ever, the park will be completed. Who and what should I believe?

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We are in negotiations to purchase a co-op apartment on the Upper East Side. Our lawyer reviewed the minutes and discovered that the building has a bedbug infestation. Should we go forward with our purchase?

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My purchase application was approved by the co-op Board, but it is conditioned upon my providing a maintenance deposit and guaranty by my parents. Do I have to comply with the conditions?

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At my closing, I had to reimburse the Seller for his New York State “STAR” rebate that appeared on the maintenance statement for the month following the Closing. What exactly is the STAR rebate and will I be able to obtain the rebate as well?

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I'm selling my co-op next month and my attorney aked me to "freeze" the line of credit I have with my bank. What exactly do I have to do?

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I just found out that the seller will be unable to close for an additional two weeks. As a result, I will have to extend my rate lock, at a cost of $1,200.00. Is the seller obligated to reimburse this cost?

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I am buying a new construction condo and the Offering Plan is over 400 pages. Do I need to read the entire Offering Plan?

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We ran across a co-op that has a few “sponsor owned” apartments for sale. Is there any advantage in buying one of the remaining sponsor apartments?

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I am about to make an offer on an apartment, but I have not been provided with the current financial statements for the co-op. Am I entitled to review the financials before I make my offer?

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We are selling our apartment to our neighbor, but our neighbor can’t afford to purchase our apartment unless she sells her apartment. Her lawyer wants the contract to provide that the purchase of our apartment is contingent upon the sale of her apartment. Our lawyer is advising us against including a provision that makes the transaction contingent on the sale of the buyer’s apartment. Should we go along with the contingency?

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Q

We are selling our co-op and the buyer is not obtaining a mortgage in connection with the purchase. The contract required the Board package to be submitted within 10 business days after the fully-executed contract was returned to the buyer. The buyer is two weeks late in submitting the package. Is the buyer in default?

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Q

I’m selling my condo and I have not been able to pay my common charges for the past six months (I lost my job). I have a buyer for the apartment, but the Board of Managers will not release the Waiver of the Right of First Refusal, unless I pay the outstanding balance of the common charges. I’m between a rock and a hard place, as I don’t have the money. What should I do?

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Q

I am combining two adjacent apartments that I own and I want the co-op to issue one stock certificate for both apartments. There is an outstanding UCC lien against one of the apartments. The other apartment is owned free of any liens. Can the co-op object to the combination?

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Q

My attorney asked me to contact the managing agent to verify the maintenance and assessment information that's disclosed in the contract for the apartment I intend to purchase. Isn't that my attorney's job?

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Q

Our application to purchase a co-op was turned down by the Board without an interview. Although our attorney asked the managing agent to disclose the reasons for the Board’s decision, none were given. Can the Board just turn our application down without any explanation?

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Q

My bank issued a loan commitment, but then withdrew its underwriting because private mortgage insurance was not available. Will I have a problem canceling the contract and getting my deposit back?

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Q

The seller has a storage bin, but the contract indicates that the apartment does not come with a storage bin. If I buy the apartment, can I be sure that a storage bin be avaialable?

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Q

I’ve been asked to serve on the Board of my co-op. Could I be held liable if the co-op is a party to a law suit?

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Q

I am buying a co-op in Manhattan. The managing agent is located in Brooklyn and refuses to send a closing representative to the attorney’s office for the buyer or seller located in Manhattan. Will everyone have to go to Brooklyn for the closing?

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Q

We are purchasing a condo that was occupied by a tenant at the time the contract was executed. We just did the walk through and there is damage to a portion of the floor that was hidden by the tenant’s furniture. Are we entitled to a repair credit at Closing?

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Q

A loan commitment was issued, but the bank requested an explanation for a $14.00 missed credit card payment that occurred nine years ago. Could the bank withdraw its commitment as a result of this missed payment?

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Q

I'm selling my co-op, which I own with my mother and father. Is it okay to have the closing checks made out to the three of us?

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Q

A leaking pipe inside the wall of my co-op was recently replaced. The following month, my maintenance account was charged $1,000.00 on the theory that the pipe only serviced my apartment. Am I responsible for this repair?

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Q

A condo buyer has a mortgage contingency, but the closing will not take place for six months as the seller has a tenant in the apartment. When should the purchaser apply for financing?

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Q

We submitted our Board package a month ago, but the Board has not scheduled an interview or asked for any additional information. To make matters worse, the managing agent won’t give us any indication as to what’s going on. Is there anything we can do?

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Q

My co-op contract included the seller’s flat screen, but the bank underwriter required that it be removed from the contract as it was “impacting” loan to value. Can the bank do that?

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Q

I am buying an apartment in a small co-op that is self managed. How does the bank obtain the required “co-op questionnaire” in order to complete its underwriting?

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