CoopAndCondo.com - Addressing the realities of Residential Real Estate

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

Closing Disasters and How to Avoid Them

       
Closing Disasters and How to Avoid Them

What Just Happened?

Well, things seem to going well at the closing table, and then all of a sudden, you see the blood drain out of your attorney's face and he or she seems very preoccupied at the moment. Assuming no health catastrophe is unfolding before you eyes, what has just occurred is the discovery of a "problem" that your attorney may or may not be able to solve in order to get the transaction to completion. Things can happen, and many times, problems can be avoided by pre-closing attentiveness to detail by all concerned. Here are a few of the standard "problems" and how things get solved.

Check the Check

At a recent closing, everything had gone smoothly and the closing had been completed in just over an hour (that's pretty fast). The purchaser did not attend the closing but had given his attorney a power of attorney so that his attorney could act as the purchaser's "attorney-in-fact". The bulk of the purchase price had been paid with a certified check drawn on the account of the purchaser's attorney and issued by one of the major banks in New York City. Shortly after the closing, the seller contacted his attorney about an anomaly on the check. The amount of the check both in numbers and words was correct, but the certification amount stamped on the check by the bank was $10,000 less than the amount of the check. A call to the bank disclosed that if the check was deposited, the seller would only get credited for the amount certified by the bank, not for the amount actually written by the purchaser. What to do? The seller's attorney immediately contacted the purchaser's attorney who agreed that the check had not been prepared correctly by the bank of the purchaser's attorney. The purchaser's attorney called his bank and arrangements were made to have the incorrect check returned to the bank by messenger and a corrected check delivered to the seller. Had the mistake not been noticed, it could have taken weeks to discover why the seller was credited with $10,000 less than the amount of the check.

Nature Boy

In a recent deal, the purchasers had indicated to the seller when the contract was being negotiated, that the closing had to take place by the end of the following month, as the purchasers had notified their landlord that they would be leaving in 60 days (as required by the lease). The contract stated a closing date 60 days ahead, but did not state the closing to be "time is of the essence", nor did the contract specify a penalty for a late closing. Penalties for late closings in residential deals aren't provided for very often because closing dates are usually stated to be “on or about” dates. About a week before the closing, the seller's attorney called the purchasers' attorney and wanted to know if the closing could be scheduled three weeks after the stated closing date. As mentioned, the purchasers' lease was to expire in a few days and purchasers were counting on closing on the scheduled date. The purchasers' attorney asked the seller's attorney to contact the seller to arrange for a closing on the scheduled date. The purchasers' attorney was informed that the seller was a fan of the great outdoors, was "in the Midwest somewhere" and couldn't be contacted for several days. What to do? Fortunately, the purchasers were able to extend their existing lease for another month and the closing took place almost thirty days after the originally agreed upon closing date (in most cases, either party can delay a closing for thirty days without breaching the contract). To give the purchasers comfort, a daily penalty was agreed to by seller if the seller failed to close on the rescheduled date. The seller made it back from the wilderness and the transaction closed. What if the purchasers were obligated to move out as agreed to with their landlord? Could the purchasers charge back the cost of interim accommodations and storage? Unless specifically provided in the contract, the answer would be no. Is that type of protection usually provided in the contract? No. Although unexpected delays do occur with some regularity, closings almost always take place within two weeks of the scheduled closing date.

Money Conquers Hate

Sometimes the purchaser and seller, for many reasons, legitimately hate each other. Such a lovefest took place several years ago involving a triplex apartment in a brownstone located on the upper east side of Manhattan with a seven-figure selling price. The purchaser had been renting the apartment from seller at a fairly pricey rent for a number of years. Disputes had arisen over the years about certain repairs that the purchaser claimed the seller should have made, but had been made and paid for by purchaser. For reasons known only to purchaser, he chose not to reveal his desire to have such costs reimbursed (about $7,000 worth), until two hours into what would become a seven-hour closing. The seller said no, left the closing room and the purchaser's attorney threw his pen at the seller's attorney. What to do? The seller's attorney spoke with the seller, the purchaser and the purchaser's attorney. Entrenched positions, no progress. The closing had started at 3 p.m. and it was now close to 7 p.m. As is usually the case, after much cajoling, begging and pleading, the parties agreed to split the cost and complete the transaction. Fortunately, the closing had been scheduled for late in the day at the offices of the attorneys for the purchaser's bank. Since it was a small coop (only two units), there was no managing agent involved. The bank's attorney was willing to let the parties fight it out and agreed to stick around. Had the closing taken place at the office of a managing agent, the closing would have been adjourned as managing agents stop being cooperative once the two-hour mark has been surpassed. The parties would have been kicked out after 2 hours and the closing might not ever have happened. As is always the case, if the payment of a small sum of money can make a problem go away at the closing table, pay the money and move on.

Show Me the Money

Banks don’t like to lend money as much as they used to. When they do agree to make a residential loan, they wait until the last possible moment to fund the loan. In many cases, the bank does not fund the loan until the morning of the closing. Sometimes the wire transfer gets lost or takes longer than expected. At a recent closing that began at 2 p.m., the parties finished their paperwork with the coop and with each other by 2:30. At 3:15, the office of the bank’s attorney was called as no one had arrived from the attorney’s office. When the attorney finally showed up at 4:30, he announced that the wire of funds had not yet been received by the bank. The managing agent demanded that the closing be adjourned. The parties begged the indulgence of the managing agent so that the closing could be completed. The peson handling the closing for the managing agent reluctantly agreed. 5:30, still no money. At 6:00, the bank's attorney announced that the wire had been sent and that someone would hand deliver the official bank checks as soon as the wire was received. The managing agent's representative, for lack of a better word, was hysterical. The yelling and screaming commenced. At 7:00 pm, the checks finally arrived and the closing was completed. Something that should have taken 2 hours, turned into a 5 and half hour drama. If there is a way to complete the transaction, keep the parties in the room and make it happen.

The Inexperienced Attorney

At a closing of a cooperative apartment, a substitute lawyer showed up for the seller's attorney who was unavailable because of a schedule conflict. The seller's attorney asked to speak with the purchaser's attorney outside of the closing room. An "outside the closing room conversation" is generally an indication that something has come up and will have to be worked out. The seller's attorney informed the purchaser's attorney, that he was, in fact, a criminal attorney, had never attended a real estate closing before and was just doing his friend a favor. What to do? The purchaser's attorney agreed to call the plays for the substitute counsel who had at least shown up with the necessary paperwork. Not fair, but it worked.

Check the Check--Part II

At a closing for a cooperative apartment with a purchase price over a $1,000,000, the purchaser was obligated to pay a one percent "flip tax" in connection with the purchase of the apartment. In some buildings, the Board passes along this transfer fee to the purchaser rather than the seller who usually pays the flip tax. Prior to the closing, the seller's attorney checked with the purchaser's attorney to make sure that the purchaser would bring an official bank check for the flip tax as well as a official bank check for the "mansion tax", as the price was over a million dollars. In New York State, if the price of a home is $1,000,000 or more, the purchaser has to pay a transfer tax to New York State equal to one percent of the purchase price. As it turned out, the seller's attorney knew the purchaser's attorney from a number of other closings. Everything was going fine at the closing until it came time for the purchaser to present the checks for the flip tax and mansion tax. The payment of the mansion tax had not been mentioned to the purchaser. Silence at the closing table. Without the payment of the mansion tax, the closing could not be completed. What to do? The purchaser's attorney accepted a personal check from the purchaser (which check would not have been accepted by New York State) for the amount of the mansion tax (a little risky for the purchaser's attorney but it had to be done) and agreed to give the seller's attorney an "attorney's escrow check" for the payment of the tax, which check would be acceptable to New York State. The purchaser's attorney then agreed to go to the bank immediately after the closing and certify the attorney's check (which really wasn't necessary, but was appreciated). If the attorneys had not known each other, the dance over the check might not have gone as smoothly. Once the parties are at the closing table, the attorneys do try to work things out almost all of the time.

Spelling Counts

The parties were done with the closing documents and the purchaser’s attorney produced the official bank checks that the seller’s attorney had requested. The numbers were perfect, but there was one small problem, the pay-off check for the seller’s mortgage had the wrong bank as payee. That’s not good. Fortunately, the purchaser’s bank was close by and the purchaser left the closing to get the check replaced. A one hour delay, but the closing was completed.

I’ve Got the Power

Many times one or both parties have their attorney represent them at the closing by power of attorney. Those powers are usually approved in advance by all parties who will have to rely such powers, such as the managing agent, title company and the seller and purchaser, as the case may be. When someone shows up at a closing with a last minute power, problems can occur. At one closing, the attorney showed up with a power that had been signed by the purchaser, but had not been notarized. The purchaser was in California, so there was no way to for a corrected power to arrive at the closing. Fortunately, it was a condominium transaction and the title company agreed to take a faxed copy of the properly completed power, with an “undertaking” from the purchaser’s attorney to overnight the original power the next day. The seller didn’t care how the purchaser worked things out, as long as the transaction closed and the checks were delivered, which they were.

Show Me the Money—Part II

Buyers usually wire funds to a checking account from a brokerage account a day or so before the closing, in order to have sufficient funds to close. In a recent situation, a foreign buyer, who was an “all cash” buyer, was getting his funds from a bank account somewhere in Europe. The buyer insisted on a specific closing date and the seller accommodated the buyer’s wishes. The day before the closing, the buyer announced that the funds had not arrived. The usual panic ensued from the seller’s attorney. The deposit funds had showed up late and now the closing funds were missing. Would the closing ever happen? Was the buyer real? The inevitable questions started getting asked without any satisfactory answers. The closing was adjourned for two weeks. The day before the re-scheduled closing, the buyer’s attorney had not received the funds. Apparently, the wire had been bounced back to the buyer’s bank in Europe for reasons unknown. Anxious calls from the seller’s attorney, with the threat level increasing. Finally, a week later the funds did indeed arrive and all was forgiven at the closing table (as it usually is). Had there been a problem with the underwriting of the buyer's loan (where a portion of the closing funds were coming from the buyer's bank), the ending could have been quite different. Sellers have no choice, but to wait for the the buyer to complete his or her obligations with the bank, so that the loan will be released for closing. If a bank withdraws it's funding, because of a material change in circumstances, a transaction that was on its way to the closing table, can come to a complete halt. In today's world, banks can and do withdraw underwriting. Fortunately, a bank exiting a transaction does not happen with any frequency.

Residential Reality: Close, If You Can

Once the parties get to the closing table, the attorneys will do what they can to get the transaction closed, no matter what comes up at closing. Some problems are insurmountable and the closing will have to be adjourned. In most cases, a solution will be found and the parties will wait it out until the accommodation is made, the undertaking is given, the fax is received or the required E-mail shows up. Wear comfortable clothing, it could take awhile.

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

Asked and Answered

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

Do I care who the bank attorneys are?

Click for Answer...

Q

Do I have to go to the closing?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

Can I undertake renovations before the Closing?

Click for Answer...

Q

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

Click for Answer...

Q

Should I let the broker do the walk through?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

Does my dog have to be interviewed by the Board?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

Q

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

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?

Click for Answer...

Contact Ron Gitter

Buying or Selling? Email me at