New York's Cooperative and Condominium Community

Habitat Magazine Insider Guide




The co-op board approval process may seem simple or complex, depending on the board, but one thing is certain: It's all about whether you're going to be a good fit for the building, both financially and personally. "It's a crap shoot," admits Peter Lehr of Kaled Management. "Is that person going to be an ideal shareholder or is that person going to be a nightmare?"

And it's a crap shoot for you as well. What does a board want to know ahead of time? What will it ask at the in-person interview? Just what exactly is expected of you?

Here are some ways to make it successfully through the process.

The Basics

First off, it's legal for a board to be discriminating – as in being picky – but not to discriminate, as in rejecting against applicants for reasons of race, color, religion, national origin or ethnicity, sex, age, marital status (which also includes the number of children in a family), disability, sexual orientation or citizenship status.

That said, "It's appropriate to find out certain information about the applicant, like whether he can afford to pay [his or her] maintenance and how many people will live in the unit," says attorney Steve Wagner, a partner at Wagner Davis. Boards can reject applicants for financial reasons, for instance, and base that decision on income, credit checks, residential history and/or employment history. The rationale is that successful applicants must be able to pay their monthly maintenance charges, special assessments and mortgage payments. No board wants to accept a buyer who could soon be in default.

step one 

The admissions process usually

begins with the application package.

There are typical groups associated with "legal discrimination." Those are: entertainers and celebrities, who are often rejected for membership out of fear for the notoriety and unwanted visitors they can bring to a building; political figures and diplomats, for those same reasons, as well as the fear of terrorist violence; attorneys, for their tendency to pursue litigation and find legal loopholes to avoid maintenance charges or granting boards access to their units; and applicants who have moved frequently, because in the event of another move, the purchase may turn into a sublet situation.

Application Package

The formal admissions process usually begins with the application package. Most boards request your age, residential history, employment and bank history, references, financial information including assets, debts and credit report, your hobbies and interests, your interest in board or committee service, and information about everyone who will live in the apartment.

For example, Brigham Park Cooperative in Sheepshead Bay, Brooklyn, has a fairly detailed application package. After the seller and the buyer agree on a price, says Lewis Kobak, the general manager and former president of the co-op, the buyer has to submit a one-page "preliminary application" with such financial information as purchase price, mortgage amount and monthly payment, annual income from all sources, anticipated balance of reserves remaining after closing (including bank accounts, investments, stocks and bonds, IRAs, 401Ks), and other real estate owned. The co-op allows financing of up to 75 percent of the purchase price, and requires purchasers to use the apartment as their primary residence.

This information isn't verified and is just designed for a preliminary review by board's screening committee. After about 10 days, the board sends a letter to the seller (with a copy to the buyer) saying whether the purchaser is either eligible, and if so, to proceed with the full application package. "This avoids a lot of wasted time, money, and effort for all parties involved, as opposed to starting with the full, verified application process," explains Kobak.

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Learn all the basics of NYC co-op and condo management, with straight talk from heavy hitters in the field of co-op or condo apartments

Professionals in some of the key fields of co-op and condo board governance and building management answer common questions in their areas of expertise

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