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My question is, regardless of where in Manhattan, has anybody successfully turned around the initial findings of the bank and gotten a mortgage for an apartment when their initial inquest was turned down?
In my case we found out the building we like has lost money the past two years and our bank won't give us a mortgage for the to remain nameless building.
is it on a Street that wants its name changed?
No, Brooks, it is not on Buckingham Place.
Howard35: If the building's problems are significant, you might have to go with a lender/program where you can offset excess building risk with other forms of security - for example, by pledging assets or making a larger down payment. HSBC has a program that isn't too onerous. Wells has one too, though it's really for high net-worth buyers.
I doubt you can reverse the bank's decision. The same bank might ultimately give you a loan, but it will most likely be under a different program with less favorable terms.
Why would you want to buy in to a building that is loosing $$
Most co-ops lose money on their P&Ls -- it's a considered way of running the business for tax reasons.
So there's something more nuanced than that which means that the building doesn't meet Fannie Mae guidelines, so the bank you're applying to can't resell the loan.
You'll need a bank that will instead hold the loan on its books -- i.e. a "portfolio lender" -- someone like Astoria Federal.
Your mortgage broker should be able to give you a list of these.
DG Neary Realty
"Your mortgage broker should be able to give you a list of these."
Ali: I hope a mortgage broker would do a bit more than provide a list of portfolio lenders.
With regard to the accounting question, you're probably right that the issue isn't exactly negative P&L. It's more likely insufficient cash flow earmarked for reserves.
Love the thread title. Makes me think of this classic:
Brooks2, we were thinking of putting an offer on an apartment in this building when we asked our Banker to do a "background check" per se. That is when we found out about the no go. So we will definitely open up our search again. I feel sorry for the building. Hopefully, they will be able to sell their apartments, as I am hopeful that my nameless and good bank is one of the few that won't front mortgages for that building.
We will take a look at this scenario and review the building. Feel free to email me.
MortgageMan787, email sent.
front_porch, please clarify for me, "Most co-ops lose money on their P&Ls -- it's a considered way of running the business for tax reasons."
and who are some other "portfolio lenders"??
You need to look at the Statement of Cash Flows, not just the Statement of Income and Expenses.
E.g., for my co-op the latter shows a 2011 loss of $500K, whole the former shows a gain of a few thousand. That's because more than $500K of depreciation counts as an expense, but wasn't actually spent.
But, as Ali and West81st said, the lender would know how the accounting works and was probably put off by some cash-flow problem.
cash flow is always important
Concerned, are you seasoning your personality so you can soon become like str33teasier, or are you senile, reflected by your several short useless posts on numerous threads?