!"#$%&' ) *%+,"- ./0'+12 3/45' !

!"#$%&'
(")*$
!"#$%&' ) *%+,"- ./0'+12 3/45' "
+,-,. ,% +,0*,
#$%&'()*+ (-'./-.'&
1here are Lwo Lypes of aparLmenL ownershlp sLrucLure ln n?C: Co-op (shorL for cooperauve")
and condomlnlum.
Many people confuse condomlnlums wlLh cooperauves. As far as llvlng sLandards go, Lhe Lwo
are slmllar. Powever, from a legal and nanclal polnL of vlew, Lhere are ma[or dlerences. Clder
bulldlngs (pre-1980s) Lend Lo be co-ops, whlle preuy much everyLhlng bullL from Lhe 1980s
onward ls condo.
Pere's a qulck overvlew of Lhe key dlerences and conslderauons.
+,-,.1 ln a co-op, Lhe enure bulldlng ls owned by a slngle corporauon. lnsLead of a deed,
buyers geL shares (sLock cerucaLes) ln Lhe corporauon, and a proprleLary lease LhaL allows
buyers Lo occupy a speclc unlL and provldes rules and rlghLs much llke a lease ln a renLal
bulldlng. 8uyers of co-op aparLmenLs are referred Lo as LenanLs" or shareholders," noL
owners."
+,0*,1 8uylng a condo ls slmllar Lo buylng a slngle-famlly house. ?ou geL a deed Lo Lhe
aparLmenL LhaL glves you ownershlp of Lhe lnLerlor of your unlL and Lhe surface of lLs walls, as
well as an undlvlded lnLeresL ln Lhe bulldlng's common elemenLs. 1hls ls Lhe Lype of ownershlp
almosL everyone has ln mlnd when Lhey Lhlnk abouL buylng a home, and almosL all newer
bulldlngs are condos.
Aer you buy your aparLmenL, you wlll largely nd LhaL Lhe legal ownershlp sLrucLure has llule
lmpacL on your use of lL. Powever Lhere are a number of qulrks relaLed Lo each LhaL wlll be
dlscussed furLher below.
/#0#+ 1 /#%2# 3#4'2(
+,-,.1 Shareholders elecL a volunLeer co-op board LhaL--excepL ln some very small bulldlngs
LhaL choose Lo save money by self-managlng--works wlLh a properLy managemenL company Lo
oversee Lhe care and malnLenance of Lhe bulldlng.
1he board also creaLes and enforces rules abouL everyLhlng from renovauon lnslde unlLs, Lo
whaL's allowed Lo Lransplre on Lhe roof deck, Lo wheLher you can speak on your cell phone ln
Lhe lobby, or wheLher dogs wlll be allowed ln Lhe bulldlng. 1he board can levy nes agalnsL rule-
breakers and, unllke condo boards, can even evlcL an exLremely dlsrupuve shareholder and force
Lhem Lo sell Lhelr aparLmenL.
!"#$%&' ) *%+,"- ./0'+12 3/45' 5
+,0*,1 Condo owners also elecL a board of dlrecLors LhaL perform many of Lhe same funcuons
as a co-op board. Cenerally speaklng, Lhough, mosL condo boards Lend Lo be more hands-o
when lL comes Lo rulemaklng.
1haL sllghLly more lalssez-falre approach ls parLly due Lo phllosophlcal underplnnlngs (more on
LhaL below) and parLly because condo boards wleld less enforcemenL muscle: 1hey can ne
owners only for Lhe expense relaLed Lo any rule lnfracuon (or geL an ln[uncuon Lo sLop lL from
happenlng agaln). 8uL because a condo owner acLually owns hls or her unlL, a condo board, unllke
a co-op board, can'L evlcL an owner from an aparLmenL.
!"#$% ln boLh co-op and condos, your voung power lncreases wlLh Lhe slze of your aparLmenL.
6#%-)78 /)4'9&( 4%2 4((&(6&%-(
+,-,.1 Co-op shareholders pay a monLhly malnLenance fee. arL of Lhe fee goes Loward Lhe
expense of operaung Lhe bulldlng. 1he oLher parL ls Lhe amounL of real esLaLe Laxes apporuoned
Lo each shareholder based on Lhe number of shares asslgned Lo each aparLmenL. arucularly
Lhese days, when properLy Laxes and fuel cosLs are rlslng sharply, malnLenance fees are frequenLly
ad[usLed upward each year (3-7 annual lncreases are qulLe common).
ln addluon, co-op boards can requlre shareholders Lo pony up exLra cash from ume Lo ume
Lo boosL Lhe reserve fund or pay for a speclc pro[ecL. ln a 40-unlL bulldlng, for example, an
assessmenL Lo replace an elevaLor mlghL run $8,000-$13,000 per unlL, dependlng on how many
shares you own. 1yplcally, shareholders can spread Lhelr paymenLs ouL over a perlod of ume such
as 6-18 monLhs.
+,0*,1 1he monLhly charges ln a condo bulldlng are referred Lo as common charges. 8eal
esLaLe Laxes are noL lncluded, lndlvldual owners are bllled dlrecLly by Lhe ClLy of new ?ork. 1hls
ls an lmporLance nuance Lo keep ln mlnd when comparlng carrylng cosLs of co-ops Lo condos,
because aL rsL glance, condos may look cheaper on a monLhly basls.
Llke co-op boards, condo boards also levy assessmenLs when necessary.
MonLhly charges ln boLh co-ops and condos Lend Lo lncrease wlLh Lhe expanslveness of amenlues
and sLa. Powever, larger bulldlngs have economles of scale when lL comes sLamng and operauon
LhaL are oen reecLed ln lower common charges.
4++'#:47 -# 3.8;
+,-,.1 A co-op board can Lurn down a buyer for any lawful reason. Powever, because Lhe
reason for re[ecuon need noL be dlvulged, Lhls means LhaL ln pracuce, unlawful reasons (race,
rellglon, professlon, sexual orlenLauon, nauonallLy, eLc.) may also prompL a re[ecuon. Powever, lf
you buy an aparLmenL dlrecLly from Lhe sponsor, you wlll noL need board approval aL all.
!"#$%&' ) *%+,"- ./0'+12 3/45' <
+,0*,1 lor varlous reasons, mosL condo buyers Lhese days are sub[ecLed Lo nearly as much
nanclal and personal scruuny as co-op buyers. 8uL raLher Lhan belng Lurned down ouLrlghL,
preuy much Lhe worsL LhaL can happen Lo a condo buyer ls LhaL Lhey wlLher away on Lhe vlne
whlle a board engages ln dellberaLe sLalllng Lacucs. SLalllng ls abouL all an unenLhuslasuc board
can do, excepL for buylng Lhe place ouLrlghL vla Lhe rlghL of rsL refusal"-whlch vlrLually never
happens.
6*%*6.6 2#$% +486&%- 4%2 7=.*2 4((&(-
+,-,.1 MosL co-ops requlre buyers Lo puL down 20-23 of Lhe purchase prlce, abouL Lhe same
as whaL mosL lenders requlre Lhese days. 8uL Lhe range can be vasL, dependlng on Lhe co-op-
anywhere from 10 down (very rare) Lo 30 or more aL hlgher-end bulldlngs.
Co-ops also expecL you Lo have sumclenL money le over (also known as 'llquld asseL
requlremenLs'). 1he requlred amounL can range drasucally, from a few monLhs worLh of
malnLenance paymenLs Lo 1 Lo 3 umes Lhe purchase prlce of Lhe aparLmenL. 1wo years worLh of
morLgage and malnLenance charges ls abouL average.
ln addluon, each co-op wlll expecL you Lo meeL a debL-Lo-lncome rauo, usually around 23-
29. 1haL means your LoLal monLhly paymenLs--morLgage and malnLenance--cannoL exceed Lhe
specled percenLage of your gross lncome. An excellenL credlL score ls also requlred.
Add Lhem all up, and you wlll nd LhaL Lhe average co-op's nanclal sLandards are much hlgher Lhan
Lhe average morLgage bank...a prlmary reason n?C co-ops wlLhsLood Lhe recenL recesslon so well.
+,0*,1 1he Lyplcal downpaymenL requlred ln a condo bulldlng ls around 10, dependlng
on Lhe bulldlng's bylaws. 8ear ln mlnd, Lhough, LhaL lf you're gemng a morLgage, banks Lhese
days oen requlre 20, unless Lhe bulldlng qualles for an lPA loan, whlch carrles a 3.3
downpaymenL requlremenL.
Many co-ops and condos Lhese days requlre buyers Lo puL an addluonal one Lo Lwo years of
common charges ln an escrow accounL as lnsurance agalnsL nonpaymenL. 1he odds of Lhls
happenlng Lo you lncrease along wlLh Lhe percelved 'rlsklness' of your appllcauon, as measured ln
debL-Lo-lncome rauo, u.S. cluzenshlp sLaLus, or a varleLy of oLher facLors.
/#(-
n?C co-ops are cheaper, on average, Lhan condos. arL of Lhe reason co-ops Lend Lo cosL less
ls because Lhey are Lyplcally older, lacklng Lhe amenlues of Lhe Lhousands of new condos
consLrucLed ln Lhe pasL decade. Many newer condos have also secured properLy Lax abaLemenLs
LhaL enable developers Lo command hlgher sales prlces Lhan lf buyers had Lo pay full Lax bllls
rlghL away.
!"#$%&' ) *%+,"- ./0'+12 3/45' >
ln addluon Lo hlgher purchase prlces, condos also have subsLanually hlgher closlng cosLs lf you're
Laklng ouL a morLgage: ?ou wlll pay a morLgage recordlng Lax of 1.8 of Lhe morLgage amounL for
loans under $300k or 1.923 for loans above LhaL. Also, your lender wlll requlre you Lo buy uLle
lnsurance, whlch cosLs abouL .3 of Lhe purchase prlce.
(noLe: 1he new ?ork SLaLe leglslaLure ls Lrylng Lo exLend Lhe morLgage recordlng Lax Lo co-op
purchases as well.)
lf you're buylng a new condo (versus a resale), Lransfer Laxes (1.823 of purchase prlce for
properues over $300,000, and 1.423 for properues under $300,000) are also Lhe buyers
responslblllLy, Lhough Lhese can oen be a polnL of negouauon wlLh a developer, who ls more apL
Lo cover fees llke Lhls Lhan reduce Lhe sales prlce, whlch can aecL fuLure sales.
(.37&--*%9
+,-,.1 MosL co-ops have very sLrlcL pollcles abouL sublemng, whlch does noL make Lhem an
ldeal lnvesLmenL opporLunlLy and can presenL a serlous challenge lf your [ob suddenly relocaLes
Lo London, for lnsLance. 1he rules vary, buL owners are usually allowed Lo subleL Lhelr aparLmenL
for no longer Lhan 1 Lo 2 years ln any 3-7 year perlod. 1he board also geLs Lo approve your LenanL
and charge you a fee for sublemng.
+,0*,1 Condo subleL pollcles are far more llberal. Whlle Lhere may be rules agalnsL shorL-Lerm
subleLs (say, less Lhan 6 monLhs), Lhere ls usually no ouLslde llmlL nor do boards have Lhe rlghL
Lo Lurn down a LenanL unless Lhey exerclse LhaL rlghL of rsL refusal and lease your aparLmenL
Lhemselves. 8uL [usL llke a co-op, appllcauon fees, move-ln fees, processlng fees, eLc., can range
from a few hundred Lo a couple of Lhousand dollars exLra LhaL you or your poLenual LenanL wlll
have Lo pay. And you wlll be llvlng ln a bulldlng wlLh a more LranslenL populauon Lhan a co-op.
!"#$%&' ) *%+,"- ./0'+12 3/45' ?
2)3$'4#2$' 5 ,46$%
+,0')*$%74),0'
now, brace yourself for some sweeplng generallzauons abouL llfesLyle and oLher conslderauons
ln a co-op vs condo. ?ou wlll need Lo do your research Lo dlscover whlch of Lhese sLaLemenLs
acLually applles Lo Lhe bulldlng you're conslderlng.
8 &"'(" "*'$+, -./"+ -+$$("0 .'( .1#"'"023 Among oLher Lhlngs, Lhey don'L wanL Lo be Lold
wheLher Lhey can buy an aparLmenL or Lo whom Lhey can sell lL or subleL lL Lo, wheLher Lhey
can have a dog (or whaL klnd, or Lhe maxlmum lL can welgh), wheLher Lhey may renance or
Lake ouL a home equlLy loan, eLc.
9 Co-op owners are more *"++4$( .5"1# *6$#6$+ #6$ 74/4'8 $'/4+"'0$'# Lhey Lhlnk Lhey are
buylng lnLo w||| ||ve up to the|r expectanons-and Lhey wanL Lo proLecL lL.
: lor Lhe reasons above, 9"'(", 0.2 5$ '"4,4$+ and lled wlLh a hlgh Lurnover of renLers who
don'L care abouL gemng along wlLh Lhe nelghbors and may have a greaLer Lendency Lo neglecL
Lhe bulldlng. Co-ops, whlle oen more peaceful and beuer Lended, can be mlcromanaged,
lnbred, and change averse.
; newer condos LhaL sprang up durlng Lhe recenL consLrucuon boom and aerward-#6$
0.:"+4#2 "- 9"'(", -"+ ,.7$ #"(.2;#$'( #" 5$ 7"9.#$( 4' 7$,, 9"'/$'4$'# "+ ($,4+.57$ .+$.,,
where land was avallable. ln Manhauan, for lnsLance, Parlem, Lhe llnanclal ulsLrlcL and
MldLown WesL ln parucular saw a dlsproporuonaLe share of new developmenL.
< Newer condos tend to have more des|rab|e amen|nes boLh lnslde Lhe aparLmenL (washer/
dryers, anyone?) and ouLslde (roof decks, playrooms, healLh-club-quallLy gyms, eLc.) Lhan
co-ops and older condos. (1haL sald, many co-ops have sLarLed reLromng some amenlues ln
order Lo sLay compeuuve...oen wlLh mlxed resulLs.)
= It can be d|mcu|t, and expens|ve, to hnd condos |n the most des|rab|e areas such as CenLral
ark WesL or Lhe besL parLs of Lhe WesL vlllage. Slmllarly, lf you're looklng for prewar deLalls,
Lhese bulldlngs are almosL always co-ops--and when you nd a rare prewar condo, demand
and prlces are Lyplcally hlgh.
-*+#@@( -)4- 8#. 648 3& -)& /#%2# -8+&
ln addluon Lo Lhe generallzauons above, you may wanL Lo focus your search on condos lf:
8 ?ou have a large or feared breed of dog (basls for belng re[ecLed from a co-op even lf lL allows
dogs and does noL have a sLaLed slze or breed resLrlcuon)
!"#$%&' ) *%+,"- ./0'+12 3/45' A
9 ?ou are looklng for a newer bulldlng (1980s Lhrough presenL)
: ?ou are buylng uslng a LrusL or an LLC
; ?ou wanL Lo use Lhe aparLmenL as a pled a Lerre
< ?ou are buylng Lhe aparLmenL for your klds
= ?ou have sued a landlord or your lasL co-op or condo board, or you're generally lluglous (or you
are an auorney)
> ?ou're a muslclan
? ?ou have a home-based buslness LhaL lnvolves nolse or loLs of vlslLors llke Leachlng muslc or
pracuclng psychology
@ ?ou can'L aord a 20-23 downpaymenL
8A ?ou're a forelgn cluzen
!"#$%&' ) *%+,"- ./0'+12 3/45' B
'4$. 9
@*%4%/*%9
8efore you sLarL looklng for an aparLmenL, you need a preapproval leuer. Cemng one ls a
cursory process LhaL lnvolves calllng up a lender or morLgage broker, spendlng a few mlnuLes
on Lhe phone answerlng quesuons abouL your lncome and nanclal hlsLory, and preuy much
lmmedlaLely recelvlng a leuer sLaung LhaL you are preapproved for a loan up Lo x amounL aL an
lnLeresL raLe of ?.
lL's easy Lo geL a preapproval leuer. 1oo easy.
Cne of Lhe problems of Lhe leuer ls LhaL noL only has none of Lhe lnformauon relled on Lo
produce been verled yeL, buL all Loo oen, some crlucal nuance has been mlssed and lnevlLably
surfaces laLer.
1herefore, Lhls plece of paper means very llule beyond glvlng you a sense of wheLher you quallfy.
-)& /#66*-6&%- 7&--&'
Cnce your oer on aparLmenL ls accepLed, you reLurn Lo your lender or morLgage broker for a
commlLmenL leuer. ?ou submlL a loL of nanclal lnformauon, Lhe properLy ls appralsed, Lhe lender
or morLgage broker looks aL Lhe bulldlng lLself Lo make sure lL meeLs Lhelr lendlng guldellnes, and
nally Lhey glve you a commlLmenL Lo lend up Lo x amounL by ? daLe aL Z lnLeresL raLe.
6#'-949& /#%-*%9&%/8 :( @.%2*%9 /#%-*%9&%/8
Some n?C sellers may agree Lo a morLgage conungency clause ln Lhe conLracL. 1he clause glves
you Lhe rlghL Lo walk away wlLh your deposlL lf you are unable Lo geL a commlLmenL leuer.
8ecause commlLmenL leuers have so many loopholes, many buyers' auorneys ask for fundlng
conungencles" ln addluon Lo a morLgage conungency. A fundlng conungency frees you from Lhe
conLracL wlLh your deposlL lf Lhe bank falls Lo fund Lhe loan !"# %&' #(%)"& (*+(,- "&( -.%- /) '"0#
!%01-.
unforLunaLely for buyers, sellers are llkely Lo agree Lo any of Lhe above ln a slow markeL or lf
Lhey're havlng Lrouble selllng Lhelr place.
@*%4%/*%9 @#' *%-&'%4-*#%47 3.8&'(
lf you are noL a u.S. cluzen, you wlll have Lrouble gemng a morLgage from a u.S. bank unless you
!"#$%&' ) *%+,"- ./0'+12 3/45' C
are a prlvaLe banklng cusLomer of Lhelrs overseas, you are ln buslness here and Lhe bank wanLs
your buslness accounL, or Lhe bank wanLs accounLs overseas LhaL lL doesn'L currenLly have.
Lxcepnon: ?ou may be able Lo Lake ouL an lnLeresL-only 'commerclal'-Lype loan wlLh a balloon
paymenL due aL a specled ume ln Lhe fuLure, or one LhaL requlres you Lo keep a cerLaln amounL
of money ln Lhe bank as a mlnlmum balance durlng Lhe Lerm of your loan.
67 8% 0%/ 9"&' :% ;%+< ;4:9 " +'"$ '2:":' ",'-:=
no. Whlle Lhe vasL ma[orlLy of n?C aparLmenLs are represenLed by a llsung agenL (lS8C-or lor
Sale 8y Cwner-llsungs are relauvely rare ln n?C) whose 3-6 commlsslon ls pald by Lhe seller,
buyers do noL have Lo plck one real esLaLe agenL wlLh whom Lo work excluslvely. Worklng dlrecLly
wlLh Lhe seller's agenL--whose loyalues are dlvlded beLween buyer and seller--ls a bad ldea ln
preuy much every oLher way. Among oLher Lhlngs, you won'L have a real advocaLe durlng conLracL
negouauons, and you may noL hear abouL problems wlLh Lhe aparLmenL or Lhe bulldlng or resale
poLenual.
>7 ?:12 '2#'@4"$$0 4A#'+":4&' :% ;%+< ;4:9 " B,%%5C ",'-: /-5'+ "-0 %D :9' D%$$%;4-, @4+E
@/A2:"-@'2F
8 <"1=+$ 51,23 ?ou don'L have Lhe ume or lncllnauon Lo manage your search, lncludlng
researchlng avallable properues and comparables or semng up appolnLmenLs wlLh agenLs.
9 ?ou are a hrst-nme buyer.
: ?ou are '$* #" !$* <"+> &4#2.
; ?ou are 1'-.0474.+ *4#6 #6$ '$4865"+6""( ln whlch you are looklng.
< 1here are spec|a| c|rcumstances about your qua||hcanons, c|rcumstances or des|red
.?.+#0$'# LhaL wlll make your search parucularly challenglng. As ln any buslness Lransacuon,
creauve deal sLrucLurlng can save Lhe day. lor example, whlle many co-ops wlll noL approve
a pled a Lerre purchase by parenLs who lnLend for Lhelr adulL chlld Lo llve Lhere, some wlll
approve a co-purchase slLuauon ln whlch all parues (parenL and chlld) are on Lhe proprleLary
lease and sLock cerucaLe.
= ?ou are buy|ng |n a d|mcu|t co-op: A good agenL wlll be able Lo deLermlne Lhe llkellhood LhaL
you wlll pass Lhe board before you ever make an oer, whlch wlll save everyone subsLanual
ume, money and hearLache. Also, a good agenL wlll be able Lo help you cra an appllcauon
package LhaL caLers Lo Lhe whlms of Lhe board so LhaL your chances of belng approved are
hlgher.
> <"1 .+$ 5124'8 -"+ 4'/$,#0$'#% A good agenL wlLh a solld undersLandlng of lnvesLmenL
properues should be able Lo help you develop your pro forma Lo model anuclpaLed cash ows,
cap raLes, lnLernal raLes of reLurn, and expecLed neL proLs. 1hey wlll also be able Lo puL you ln
!"#$%&' ) *%+,"- ./0'+12 3/45' !D
Louch wlLh lenders and properLy managers LhaL speclallze ln lnvesLmenL properLy and help you
deLermlne Lhe markeL value of renLs. 1hey may also be able Lo help wlLh leaslng aer you buy.
? <"1 .+$ 5124'8 -+"0 . ($/$7"?$+% 8ecause Lhls can be much more compllcaLed Lhan Lhe resale
process, Lhe sponsor/developer dras Lhelr own purchase agreemenLs (unllke Lhe bollerplaLe
conLracLs Lyplcally used for resales). 1haL oen leaves more lssues Lo be proLecLed agalnsL and
negouaLed LhaL are largely unfamlllar Lo Lhe Lyplcal purchaser. Also, a good agenL should be
able Lo provlde you wlLh some lndusLry lnslghL lnLo Lhe bulldlng before you submlL an oer.
G7 H%; :% #4@< " ,%%5 +'"$ '2:":' ",'-:
Pere some slgns of good agenLs:
8 1hey are lnumaLely famlllar wlLh Lhe nelghborhood(s) you are looklng ln
9 1hey are busy, buL noL so busy LhaL Lhey hand you o Lo an asslsLanL
: 1hey work full-ume
; ?ou have a good guL lnsuncL abouL Lhem (no hlgh-pressure Lacucs)
< 1hey have experlence wlLh condos, co-ops, and new developmenLs (whlchever you are
focuslng on)
= 1hey seem Lo undersLand your LasLe and senslblllues.
Cnce a seller has accepLed Lhe oer negouaLed wlLh you and your agenL, you wlll need Lo hlre a
real esLaLe auorney Lo prepare and negouaLe Lhe deLalls of Lhe conLracL.
8uL don'L walL unul Lhe lasL mlnuLe Lo gure ouL whlch auorney you plan Lo work wlLh. 1here wlll
be a loL of fasL movlng pleces and helghLened emouons--and you don'L wanL Lo rush Lhls.
Pere are a few polnLers for plcklng a good closlng lawyer:
8 !usL abouL Lhe worsL Lhlng you can do ls hlre an auorney who does noL speclallze ln n?C
resldenual real esLaLe. 1he lnLrlcacles of closlng a n?C real esLaLe deal-from due dlllgence on
a co-op Lo readlng a condo board mlnuLes-are noL LaughL ln law school or dealL wlLh ln many
oLher real esLaLe markeLs.
9 Cn Lhe oLher exLreme, don'L plck a chop-shop closlng lawyer who Lakes a cookle cuuer
approach Lo your Lransacuon and/or ls Loo overloaded Lo be responslve.
: lf you don'L already know a good closlng auorney, ask for referrals from people you know
lncludlng your real esLaLe agenL.
; lees Lyplcally range from $1,300 Lo $2,300 for Lhe average Lransacuon. LxpecL Lo pay up Lo a
few Lhousand more lf, for lnsLance, you wanL Lo preserve your prlvacy by buylng an aparLmenL
under an LLC creaLed for Lhls purpose.
!"#$%&' ) *%+,"- ./0'+12 3/45' !!
< Make sure Lhe fee lncludes due dlllgence, and LhaL your auorney (noL a paralegal) wlll be golng
Lo Lhe managlng agenL's omce Lo read Lhe nanclals and mlnuLes (and read Lhe oerlng plan lf
Lhe bulldlng ls less Lhan 3 years old). lL's also besL pracuce for your auorney Lo admlnlsLer Lhe
managlng agenL quesuonnalre (abouL bed bugs, leaks, nolse complalnLs, reserve funds, ma[or
caplLal pro[ecLs, eLc.) ln person or over Lhe phone.cllnd ouL how much of Lhe auorney's fees
are refundable lf Lhe deal doesn'L go Lhrough.
@*%2*%9 -)& '*9)- 3.*72*%9;
lrom a quallLy of llfe and lnvesLmenL perspecuve, Lhe bulldlng you buy lnLo can mauer more
Lhan Lhe speclc aparLmenL you wlnd up buylng. 1haL's a lesson rsL-ume buyers and people
new Lo n?C generally wlnd up learnlng Lhe hard way--falllng for Lhe vlew and regremng Lhe hlgh
malnLenance charges (or Lhe hlgh-malnLenance board).
B3CDD EFGHIJF& KLM BNOIPF-QDRHF& HE SDKIL RDM TMRRGUKLV WCIDMILQE1 A slmple doorman"
bulldlng can be as no-frllls as a parL-ume doorman bulldlng LhaL has a llve-ln super. 'lull-servlce'
lmplles all Lhe Lrlmmlngs you would expecL such as porLers, a resldenL manager, and posslbly a
conclerge ln addluon Lo round-Lhe-clock doormen. A whlLe glove Lbulldlng ls full-servlce wlLh a
ve-sLar-hoLel level of servlce and cleanllness.
?our monLhly charges wlll reecL Lhe level of sLamng, and generally speaklng, Lhere ls an economy
of scale: lL can cosL less per aparLmenL Lo sLa a 300-unlL full-servlce bulldlng Lhan lL does Lo sLa
a 123-unlL bulldlng. 1lpplng durlng Lhe holldays ln a full-servlce bulldlng can range from $1,000-
2,300 per year, Lhough Lhere ls no obllgauon Lo up.
T7PPFLMFM FDFHKPRGV WCIDMILQE1 1hls ls a rapldly dylng breed of smaller prewar bulldlngs LhaL
sull feaLure old-fashloned manually-operaLed elevaLors. 1he elevaLor ls operaLed by a unlformed
auendanL who funcuons as a doorman when noL ferrylng passengers. Powever, Lhere ls noL a
separaLe doorman, so package accepLance and oLher Lypes of duues cannoL be rellably carrled
ouL aL all umes, wlLh Lhe auendanL Loggllng back and forLh beLween Lhe fronL door and Lhe
elevaLor.
We can'L really Lhlnk of an upslde Lo Lhls arrangemenL (besldes delaylng Lhe cosL of upgradlng Lhe
elevaLor). All Lhlngs belng equal, we'd raLher have a doorman.
$DFHKPRG WCIDMILQE1 Compared Lo luxury full-servlce bulldlngs, Lhese are generally on Lhe smaller
slde, Lopplng ouL aL around 10-13 sLorles. AL mosL, Lhey are sLaed wlLh a llve-ln super and
maybe a parL-ume porLer/handyman Lo help ouL.
Many people swear Lhey would never llve ln a non-doorman bulldlng, clung safeLy and
convenlence. CLhers nd LhaL a good llve-ln super who accepLs packages ls an excellenL Lrade
o for lncreased prlvacy and slgnlcanLly lower monLhly charges. 1hese days Lhere are also
!"#$%&' ) *%+,"- ./0'+12 3/45' !"
sophlsucaLed remoLe doorman sysLems LhaL can perform many of Lhe funcuons of a Lradluonal
doorman.
XKDY-CSE1 1hese ve- or slx-sLory bulldlngs are usually very compeuuve prlcewlse. Many lf noL
mosL rely on help from a parL-ume o-slLe super, and some requlre LhaL owners Lake up some
duues usually performed by a super, such as shovellng snow.
.GFNKG HE SREPNKG HE LFN1
@+$*.+ 5147(4'8, were bullL before World War ll and generally buL noL always embody Lhe
eleganL, lconlc archlLecLural sLyles assoclaLed wlLh old" new ?ork and oen have graclous room
proporuons wlLh hlgh celllngs.
Cn Lhe negauve slde, prewar bulldlngs Lend Lo have fewer amenlues, and unllke Lhe newesL crop
of consLrucuon, comparauvely few allow ln-unlL washer dryers, Lhough Lhere ls some progress
belng made on LhaL polnL as prewar bulldlngs revlslL plumblng lssues Lo Lry Lo remaln compeuuve
ln Lhe resale markeL. uue Lo Lhelr older vlnLage, mosL prewars are co-ops raLher Lhan condos.
@",#*.+ 5147(4'8, baslcally span Lhe perlod from World War ll up unul Lhe laLesL clrca-2000
consLrucuon boom. 1hese bulldlngs lnclude Lhe huge mlddle-class houslng pro[ecLs llke
SLuyvesanL 1own, Lo Lhe 60s-era whlLe-brlck hlgh-rlses plenuful on Lhe upper LasL Slde easL of
LexlngLon Avenue, Lo red-brlck cookle cuuer consLrucuon LhaL characLerlzes much of Lhe 1980s
consLrucuon.
Whlle Lhere are excepuons, Lhe cookle-cuuer naLure and lack of archlLecLural deLall of many of
Lhese bulldlngs can make Lhem a more aordable opuon Lhan prewar or Lhe newesL consLrucuon.
1hey are llkely Lo have amenlues llke laundry rooms and Lness cenLers, and Lhelr wlndows,
baLhrooms, and elevaLors are oen larger Lhan prewar, buL many are also known for Lhelr low
celllngs and slapdash consLrucuon LhaL shows up ln nolse-Lransmlmng walls and oors.
New construcnon bulldlngs born ln Lhe mosL recenL (posL-2000) consLrucuon boom and
aerward Lend Lo lavlsh much auenuon on sLyle and deslgn. Pallmarks lnclude an emphasls on
oor-Lo-celllng wlndows, open klLchens, and amenlLy spaces LhaL can range from full-servlce gyms
and screenlng rooms Lo peL spas, landscaped roof Lerraces and chlldren's playrooms wlLh a full
schedule of classes and acuvlues. any unlLs were deslgned Lo accommodaLe washer-dryers.
All of Lhls comes aL a cosL: 1he sense of spaclousness provlded by huge wlndows and open
klLchens allow developers Lo shave acLual square feeL from llvlng areas, amenlues boosL
Lhe common charges, and as menuoned earller, many newer bulldlngs (1-3 years) are sull
experlenclng growlng palns relaLed Lo consLrucuon defecLs and sponsor rule. uependlng on Lhe
developer, nolse Lransmlsslon and alr quallLy lssues can also be a problem.
Also, because new consLrucuon was Lhe lasL Lo Lhe land-grab Lable, newer bulldlngs Lend Lo be
less convenlenLly locaLed Lhan older houslng sLock. 1hey are condos, noL co-ops, because of a
!"#$%&' ) *%+,"- ./0'+12 3/45' !5
condo's lax subleL rules, Lhls can lead Lo a hlgher proporuon of renLers Lhan some owners are
comforLable wlLh.
@*%4%/*47 )&47-)
Aer your oer ls accepLed, a good auorney wlll conducL a Lhorough analysls of your prospecuve
bulldlng's nanclal slLuauon. Whlle you're ouL Lhere shopplng and comparlng bulldlngs, keep
ln mlnd LhaL lf a bulldlng hasn'L ralsed lLs monLhly charges ln years, Lhls ls llkely a slgn of bad
managemenL ln LhaL lmporLanL pro[ecLs are probably belng deferred. Slmllarly, whlle some
hlgher-end bulldlngs make a pracuce of runnlng lean" and levylng assessmenLs for emergencles
and lmprovemenL pro[ecLs, a reserve fund of less Lhan 3 monLhs may mean Lhls bulldlng ls
sLruggllng.
(-&+ ? ()#++*%9 @#' -)& '*9)- 4+4'-6&%-;
Cpen houses are an excellenL way Lo become famlllar wlLh Lhe bulldlngs and aparLmenLs ln
your prlce polnL ln a parucular nelghborhood. MosL are held on Sunday aernoons and you do
noL need Lo auend wlLh a broker. (noLe LhaL noL all bulldlngs allow open houses, ln whlch case
showlngs may be done by appolnLmenL only.)
I9' 24,-E4- 29'':
Many buyers vlslL open houses on Lhelr own elLher whlle worklng wlLh an agenL (wrlung Lhe
agenL's name on Lhe slgn ln sheeL) or whlle gemng Lhelr feeL weL before chooslng a agenL. lf you
slgn ln wlLhouL an agenL, and wanL Lo make an oer on Lhe aparLmenL, you usually have Lhe rlghL
Lo brlng ln your own agenL aL any ume up unul an oer ls submlued, no mauer whaL Lhe seller's
agenL Lells you.
1here are Lwo lmporLanL excepuons: lf Lhe seller's broker ls noL a member of Lhe 8eal LsLaLe
8oard of new ?ork (8L8n?), whlch ls more common ln boroughs ouLslde of Manhauan, Lhey are
noL obllgaLed Lo spllL Lhelr fee wlLh anoLher agenL (a.k.a. co-broke"). 1he same ls Lrue ln some
new developmenLs where Lhe developer's agenLs are ln-house or noL 8L8n? members.
ln Lhese Lwo clrcumsLances, alLhough you have a legal rlghL Lo choose an agenL Lo represenL you,
you may have Lo pay Lhem yourself.
H%; :% J5%K "- %#'- 9%/2'
Walk Lhrough Lhe aparLmenL as lf you llve ln lL, Lhlnklng abouL your dally rouune. uon'L assume
LhaL you can change someLhlng, llke expand Lhe baLhroom or add a washer-dryer. Could you llve
wlLh lL Lhe way lL ls?
!"#$%&' ) *%+,"- ./0'+12 3/45' !<
8ecause of Lhe hlgh Lransacuon cosLs lnvolved ln buylng and selllng aparLmenLs ln new ?ork
ClLy, you should buy an aparLmenL wlLh room Lo grow over Lhe nexL 3-7 years. So lf you're newly
marrled and plannlng for chlldren, you may wanL Lo keep renung raLher Lhan buy a one-bedroom
sLarLer aparLmenL.
@*%2*%9 4 '&+.-437& 2&:&7#+&';
Whlle buyers of brand-new wlll never be able Lo ellmlnaLe Lhe prospecL of consLrucuon defecLs,
Lhe besL hedge ls Lo buy from a repuLable developer-one who noL only bullds Lo a greaLer
sLandard of care, buL can aord Lo x Lhlngs LhaL go wrong and wanLs Lo ln order Lo preserve lLs
repuLauon and be able Lo sell fuLure pro[ecLs.
So how do you nd Lhe good ones? A good real esLaLe auorney (noL one referred Lo you by Lhe
developer) should be able Lo sLeer you away from Lhe worsL and reclLe a llsL of Lhe besL.
?ou should also Coogle Lhe name of Lhe developer for dlscusslons abouL problems ln pasL
pro[ecLs. 8emember LhaL many developers creaLe a new LLC for each pro[ecL, so look ln Lhe
oerlng plan-a huge Lelephone-book-slzed documenL LhaL along wlLh lLs amendmenLs
essenually explalns everyLhlng abouL Lhe bulldlng, from how many unlLs have Lo sell ln order for
Lhe sponsor Lo rellnqulsh managemenL of Lhe bulldlng rlghL down Lo Lhe nlsh of Lhe counLerLop
ln Lhe powder room-Lo nd ouL exacLly whlch enuues are parLners ln Lhe LLC, and Coogle Lhose
names Loo.
3.8*%9 E+'&/#%(-'./-*#%F .%*-(
8uylng preconsLrucuon" means relylng on renderlngs Lo deplcL everyLhlng from Lhe vlew
ouLslde Lhe wlndow, Lo Lhe spaclousness of Lhe masLer bedroom, Lo Lhe nlshes ln Lhe baLhroom.
Always remember LhaL Lhe sponsor ls only legally obllgaLed Lo dellver whaL's specled ln Lhe
oerlng plan, Lhe preuy plcLures are lrrelevanL, and so ls Lhe model aparLmenL.
1here are Lwo maln advanLages Lo buylng o of a oorplan: Securlng a unlL ln a hoL markeL llke
Lhls one, and Lyplcally lower early-blrd prlclng.
Sponsors release unlLs for sale ln several baLches, ralslng prlces each ume. 1he spread beLween
Lhe rsL group and Lhe lasL ls usually 3 Lo 20.
noLe, however, LhaL whlle you may geL a cheaper aparLmenL lf buy early, you won'L necessarlly
geL a beuer one. Sponsors lnclude a number of Lhe mosL deslrable unlLs ln each new baLch of
unlLs and oen save Lhe besL for lasL, when Lhey expecL Lo recelve Lhe hlghesL prlce.
!"#$%&' ) *%+,"- ./0'+12 3/45' !>
@*%4%/*%9 %&$ /#%(-'./-*#%
ln Lhe sklmsh modern credlL cllmaLe, lenders look as closely aL Lhe bulldlng as aL your nanclal
hlsLory and lncome ln decldlng wheLher Lo glve you a morLgage.
8ulldlng-wlse, lenders requlre LhaL anywhere from 13 Lo 30 of Lhe aparLmenLs ln Lhe bulldlng
musL be ln conLracL. 1he exacL percenLage ls up Lo Lhe lender, and so-called preferred" lenders
are Lyplcally aL Lhe lower end of Lhls range. referred lenders, named ln Lhe oerlng plan,
become lnumaLely famlllar wlLh Lhe developmenL and don'L have Lo sLarL from scraLch as an
ouLslde lender mlghL. 1hls mlnlmlzes Lhe posslblllLy of Lhe loan belng denled because of lssues
wlLh Lhe bulldlng Lhough lL doesn'L rule lL ouL, Lhe lender may declde aL some polnL Lo puL a cap
on Lhe number of unlLs lL ls wllllng Lo nance, for lnsLance.
8efore lssulng a morLgage Lo a buyer, lenders also requlre LhaL Lhe bulldlng have a CerucaLe of
Cccupancy or 1emporary CerucaLe of Cccupancy lssued by Lhe ueparLmenL of 8ulldlngs.
MosL lenders requlre LhaL you puL aL leasL 10 down on your new condo, Lhe average ls around
10-20. lf your bulldlng ls lPA-approved,you wlll only need Lo puL 3.3 down.
-4G 434-&6&%-(
Many new bulldlngs oer properLy Lax abaLemenLs LhaL range from 3 Lo 23 years, meanlng LhaL
you wlll owe no properLy Lax or only a specled fracuon each year unul Lhe program explres and
you re[oln Lhe hlghly Laxed herd.
A few polnLs abouL abaLemenLs:
8 1he longer abaLemenLs Lend Lo be locaLed ln emerglng nelghborhoods. Make sure you
undersLand Lhe phaslng-ln schedule: ?ou may owe zero Laxes for 10 years, Lhen 23 of
normal" Laxes ln year 11, 30 ln year 12 eLc. A rapld phase-ln can be a nanclal shock.
9 Make sure you have a reallsuc sense of your acLual Lax burden once Lhe abaLemenL explres.
1he dlzzylngly hlgh number LhaL Lhe oerlng plan says wlll be your Lax aL Lhe explrauon of your
abaLemenL ls based on 91++$'# Lax raLes and assessed properLy values. ?our acLual number
ln 7, 14, or 23 years ls llkely Lo be much hlgher as Lax raLes and assessed values conunue Lhelr
lnevlLable cllmb.
: uon'L assume you are golng Lo sell ln ?ear 7 ln Lhe evenL your lncome can'L keep up wlLh your
Laxes. Many of your nelghbors may have Lhe same ldea-and Lhe compeuuon wlll make lL
harder Lo sell for Lhe prlce you need.
; As a general rule of Lhumb, don'L spend up because you have an abaLemenL: 8uy Lhe
aparLmenL you could aord lf Lhere were no abaLemenL.
!"#$%&' ) *%+,"- ./0'+12 3/45' !?
%&9#-*4-*%9 $*-) 4 2&:&7#+&'
ln Loday's hoL markeL, don'L expecL Lo nd much negouablllLy excepL ln Lroubled pro[ecLs, aL
crlucal momenLs of a developmenL's llfecycle, and/or lf you're paylng all cash.
keep ln mlnd LhaL unllke lndlvldual sellers, developers (also referred Lo as sponsors) generally
avold ouLrlghL prlce reducuons. rlce cuLs aecL fuLure sales, as each unlL's recorded sale prlce ls
a mauer of publlc record. lf Lhe sponsor glves you $23,000 o, he wlll probably have Lo glve every
oLher buyer ln LhaL llne $23,000 o.
lnsLead, focus on negouaung Lhe Lype of concesslons Lhe resL of Lhe world wlll noL auLomaucally
learn abouL, such as:
8 3-12 monLhs of common charges pald ln advance
9 aymenL of auorneys fees
: upgrades Lo your unlL llke a beuer oor (lf noL yeL done) or oLher nlshes and appllances
; 8oof rlghLs, rooop cabanas, sLorage blns, blke spaces, parklng
< aymenL of your conLrlbuuon Lo Lhe bulldlng's reserve fund (caplLal conLrlbuuon")
= noL many buyers know abouL Lhls, and lL cerLalnly pays Lo ask, as lL can save you Lhe enure
amounL of your morLgage recordlng Lax (nearly 2 of your morLgage amounL)
> An lnLeresL raLe buy-down"
? lurnlshlngs, parucularly when you're buylng a model unlL
ln some cases, you may have more leverage aL Lhe beglnnlng and end of a pro[ecL. 1haL's because
durlng Lhe preconsLrucuon phase, Lhe sponsor wlll be focused on gemng 13 of Lhe unlLs under
conLracL. lleen percenL ls Lhe maglc number aL whlch Lhe oerlng plan ls declared eecuve by
Lhe auorney general and closlngs can legally begln. lL ls also Lhe mlnlmum Lhreshold aL whlch
mosL lenders wlll even conslder nanclng sales ln Lhe bulldlng (some wanL Lo see as many as 30
of Lhe unlLs under conLracL).
uurlng Lhe pre-consLrucuon phase, lf you are paylng all cash for your aparLmenL you wlll llkely
have Lhe mosL leverage as far as concesslons, lf noL purchase prlce.
Conversely, you may have exLra leverage aL Lhe very end of Lhe pro[ecL, when a sponsor may be
eager Lo close down Lhe sales omce and focus fully on Lhe nexL pro[ecL.
CLher polnLs of negouauon:
8 *FSREIP KURCLP1 MosL sponsors ask for 10 down when you slgn Lhe conLracL, buL ln Lhe
preconsLrucuon phase, when Lhe sponsor ls eager Lo hlL Lhe 13 mark descrlbed above-and
!"#$%&' ) *%+,"- ./0'+12 3/45' !A
ls llkely Lo be slmng on your deposlL a very long ume before dellverlng Lhe unlL-you may be
able Lo negouaLe a lower amounL, such as 3.
9 *GRS MFKM MKPFE1 Sponsors wlll never oer Lhls up, buL mosL wlll agree Lo a reasonable drop
dead" daLe aL whlch polnL you are leL ouL of Lhe conLracL. lor example, lf you're slgnlng a
conLracL ln AugusL and Lhe sponsor predlcLs closlngs wlll sLarL CcL. 1sL when Lhe bulldlng ls
predlcLed Lo be 23 sold, you can ask Lo be leL ouL of Lhe conLracL lf closlngs are delayed 3-4
monLhs pasL CcL. 1sL.
64H*%9 4% #@@&'
1yplcally, Lhe elemenLs of an oer are preuy baslc. 1hese lnclude prlce, expecLed closlng daLe,
Lhe amounL of Lhe broker's commlsslon, Lhe percenL of Lhe purchase prlce LhaL wlll be nanced
Lhrough a morLgage, and wheLher you are asklng for a morLgage conungency and/or a morLgage
fundlng conungency. Less commonly, Lhe oer may lnclude Lerms llke Lhe rlghL Lo Lake possesslon
before closlng and pay renL Lo Lhe seller. lnspecuon conungencles, allowlng buyers Lo walk away
from conLracLs wlLh Lhelr deposlLs, are noL common pracuce ln n?C, buL mosL sellers wlll agree Lo
an oer LhaL specles lnspecuon prlor Lo slgnlng." 1haL baslcally means Lhe seller wlll allow Lhe
buyer Lo have Lhe aparLmenL lnspecLed before slgnlng conLracL, leavlng Lhe buyer room Lo walk
away wlLhouL slgnlng Lhe conLracL lf an lnsurmounLable problem surfaces.
When maklng an oer below Lhe asklng prlce, your agenL should make sure lL's reasonable and
wlll share wlLh Lhe llsung agenL Lhe facLs LhaL your oer ls based on--speclc comparable sales,
an lssue ln Lhe bulldlng, a change ln Lhe economy, eLc. 1hls approach works psychologlcally by
communlcaung LhaL you're serlous and auempung Lo be falr, even lf Lhe seller does noL agree
wlLh you.
%&9#-*4-*%9
Lven lf you conslder yourself a decenL negouaLor, chances are you've only negouaLed Lhe
purchase of a home a handful of umes aL mosL. Pere are a few key do's and don'Ls LhaL your
agenL should lnsLrucL you:
8 *RL&P PKDY PRR UCJO IL ZGRLP RZ POF EFDDFG&E KQFLP[ ?ou may glve Lhe agenL reason Lo
belleve you can aord more Lhan you lnlually oer or you mlghL dlsquallfy yourself as a buyer
by lnadverLenLly underselllng your quallcauons. ?our own agenL wlll be able Lo besL presenL
your neL worLh sLaLemenL as even Lhe mosL educaLed buyers Lend Lo leave ouL asseLs LhaL Lhey
dldn'L reallze could be counLed.
9 *RL&P SGFEFLP \RCG WFEP RZZFG ZIGEP[ 1he oLher slde assumes lL lsn'L your besL oer and wlll
keep chlpplng away, whlle you've goL noLhlng le Lo glve.
: *R NGIPF KL RZZFG DFPPFG[ ?our agenL should wrlLe a carefully craed Word documenL on
your agenL's leuerhead (scanned and emalled ls ne) explalnlng your oer and Lhe reasonlng
!"#$%&' ) *%+,"- ./0'+12 3/45' !B
behlnd lL, reference supporuve lnformauon llke comparable sales. lL communlcaLes slncerlLy
and demonsLraLes you are probably noL maklng oers on 10 properues aL once. And usually
Lhe seller's agenL wlll show lL Lo Lhe seller, ensurlng LhaL your polnLs wlll noL be losL.
; *RL&P KEY ZRG FHFG\POILQ KP RLJF NIPO \RCG ZIGEP RZZFG[ A lowball oer, for lnsLance, ls besL
dlgesLed alone and ln Loday's markeL may dlsquallfy you from furLher conslderauon.
< *R WF LIJF[ lL wlll geL you a loL furLher Lhan belng a [erk, because resldenual Lransacuons are
more emouonal. 1hls lncludes your agenL--so make sure you don'L selecL one wlLh an abraslve
or bullylng personallLy.
-)& +'#/&(( 4%2 -)& &G/&+-*#%(
WheLher you're buylng a co-op or condo resale, your purchase usually musL be approved by Lhe
bulldlng. 1hls lnvolves submlmng a 43-page-long, lnvaslve, much bemoaned appllcauon package
assembled by you and your agenL LhaL lncludes Lax reLurns, recommendauon leuers, nanclal
sLaLemenLs and much, much more. Some appllcauons only reach back a couple of years, oLhers
go all Lhe way back Lo Lhe day you graduaLed from college.
As explalned earller, condos may make you work [usL as hard as a co-op, buL baslcally have
Lo accepL you, unless Lhey exerclse Lhelr rlghL of rsL refusal and buy Lhe aparLmenL ouL from
under you. 1hls almosL never happens. And ln new consLrucuon, Lhere ls noL even an appllcauon
package.
1here are a couple of slLuauons ln whlch a co-op cannoL re[ecL you:
8 T+RLM-RSEV A few bulldlngs (someumes referred Lo as cond-ops" for Lhelr condo-llke
approvals power) are acLually forbldden by Lhelr own bylaws from Lurnlng down a buyer who
sauses baslc condluons for buylng .
9 'SRLERG EKDFE
lf your appllcauon ls approved by a co-op board, you proceed onLo Lhe nal sLep: 1he board
lnLervlew.
'&4(#% 8#. 6*9)- 3& '&I&/-&2 38 4 /#0#+ 3&@#'&
8#. &:&' '&4/) -)& *%-&':*&$J
1he vasL ma[orlLy of Lurndowns occur before Lhe lnLervlew, based solely on your appllcauon. Co-
op boards do noL have Lo explaln why Lhey re[ecLed you. So alLhough, legally, Lhey musL ablde by
lalr Pouslng Laws and noL dlscrlmlnaLe on Lhe basls of race, rellglon, famlly sLaLus, eLc., Lhe facL ls
LhaL anyLhlng can and probably does happen behlnd closed doors and sealed llps.
!"#$%&' ) *%+,"- ./0'+12 3/45' !C
Pere's a brlef llsL of noL always obvlous reasons (mosL legal, some noL) for re[ecuon based on your
appllcauon:
8 1he slze, breed, LemperamenL, eLc., of your dog.
9 1he board suspecLs you plan Lo use Lhe aparLmenL as a pled a Lerre raLher Lhan your prlmary
resldence.
: ?ou are buylng Lhe place for your grown klds.
; ?ou need a guaranLor Lo aord Lhe aparLmenL.
< ?ou won'L have enough cash le over aer buylng Lhe aparLmenL Lo meeL llquld reserve"
requlremenLs, whlch can range from $23,000 all Lhe way up Lo 1x Lo 3x Lhe purchase prlce of
Lhe aparLmenL.
= ?ou don'L have a sLrong enough presence ln Lhe unlLed SLaLes (where wlll Lhey sue and collecL
money lf you defaulL on Lhe malnLenance).
> ?ou are a muslclan (nolsy), record producer (llke Lo parLy), or auorney (lluglous).
? ?ou are an aL-home muslc Leacher (nolse + loLs of vlslLors) or operaLe some oLher
ob[ecuonable home-based buslness.
@ ?ou have a hlsLory of belng lluglous and/or sulng a former nelghbor, board or landlord.
8A ?ou posLed sLupld plcLures of yourself on lacebook LhaL suggesL your llfesLyle ls noL an ldeal L.
88 ?ou are paylng Loo llule for Lhe aparLmenL (lL wlll drag down properLy values for Lhe whole
bulldlng).
89 1here are dlscrepancles ln your nanclal package LhaL have noL been adequaLely explalned.
8: ?our lncome relles Loo much on dlscreuonary bonuses or on commlsslons.
8; ?ou haven'L been aL your currenL [ob long enough.
-)& 3#4'2 *%-&':*&$
As menuoned above, Lhe good news abouL Lhe co-op board lnLervlew ls LhaL desplLe lLs fearsome
repuLauon, Lhe vasL ma[orlLy of Lurndowns occur beforehand based on a buyer's nanclal
package. Auorneys have counseled Lhelr boards Lo do Lhls ln order Lo cuL down on lawsulLs
alleglng dlscrlmlnauon.
1haL means LhaL mosL of Lhe ume, lf you've gouen Lo Lhe lnLervlew, Lhe aparLmenL ls yours Lo
lose-someLhlng wlll need Lo go very awry ln Lhe lnLervlew.
1haL sald, here are some ups:
8 uon'L answer any quesuons you're noL asked, glve loLs of yes" and no" answers, reslsung Lhe
urge Lo elaboraLe or sell yourself.
!"#$%&' ) *%+,"- ./0'+12 3/45' "D
9 Pave a copy of your appllcauon wlLh you and be famlllar enough wlLh lL Lo qulckly and
conclsely answer quesuons abouL lL wlLhouL looklng (shuMlng Lhrough papers glves a bad
lmpresslon).
: Arrlve on ume and dress professlonally.
; Couples should declde ln advance who wlll answer cerLaln Lypes of quesuons (for example,
one spouse answers all Lhe nanclal quesuons, and Lhe oLher handles Lhe resL).
< uon'L ask quesuons, as Lhey can unlnLenuonally convey negauve feellngs or lnLenuons such as,
uo you lnLend Lo renovaLe Lhe lobby?" lus, all your quesuons should be answered by now as
you've already agreed Lo buy Lhe place.
ShorL, cordlal lnLervlews are generally a good slgn. ?ou won'L nd ouL wheLher you're approved
unul laLer Lhough, usually wlLhln a few days.
-)& /7#(*%9
1yplcally abouL 60 days elapse beLween Lhe ume Lhe seller accepLed your oer, and Lhe ume you
acLually close on Lhe aparLmenL.
1he closlng wlll be auended by auorneys for you and Lhe seller, a uLle company represenLauve,
a managlng agenL lf lL's a co-op and probably Lhe agenLs for boLh sldes, who have no omclal
funcuon buL come Lo neLwork and plck up Lhelr commlsslon checks. Whlle buyers and sellers are
usually Lhere, Lhey can sklp lL and hand power of auorney Lo Lhelr lawyer.
Arrlve wlLh your lu and your checkbook, Lo cover any mlnor lasL-mlnuLe 'ad[usLmenLs' LhaL sprlng
up.
ldeally, your closlng wlll lasL one Lo Lwo hours, Lhough any number of Lhlngs llke problems wlLh
Lhe walk-Lhrough, Lardy Lransfers of loan funds, and Lardy arrlvals of humans can slow Lhlngs Lo a
crawl.
LvenLually, you wlll walk ouL wlLh a slgned purchase agreemenL, keys and a greaL new place Lo
resL your head aL nlghL.