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Thnking it might be nice to live near Central park (UES as far east as Lex, or UWS as far west as Amsterdam). Would be able to put about $300K down on, say, a $1.3M purchase. Earnings of $400K pre-tax per year. Remaining liquidity is in an IRA; even with that and the downpayment, total equity would be less than $750K.
Would this be enough for a co-op, or would the liquidity requirments, down payment requirements, suggest that a condo is more likely?
Things are getting serious in Syria.
Any coop will have an issue if you do not have at least one year of maintenance/mortgage/taxes left in your bank account (rather than IRA). Think for that matter a bank lending for a condo will have an issue as well. If you are in stable income profession such as doctor, some coops may make an exception.
One way to get around this issue is to borrow from family/friend $100K for a few months and keep it in a bank account to show liquidity.
I have about one year of maintenance/mortgage/taxes (~$100K) put away. What I don't have is 100% of the coop's value (ballpark of $1.1-$1.3M) in liquid assets. I might have half of that in retirement funds.
The wide geographical area you stated includes many co-ops that do not have the fussy requirement of having the co-op value after closing readily available in liquid assets.
Thanks mucuk - weird name; informative comment.
UES near the park is full of co-ops that will want: 50 - 100% down payment, 75 - 100% of the value of the unit liquid assets (cash IRA 401k), and 1 - 3 years maintenance in the bank after closing. Along with a monthly housing expense / total income ratio of less than 25%. More liberal terms can be found E of Lex (but is that really 'near the Park'?)
Thanks, Aaron. Is UWS more lenient in this regard? I don't need to live on CPW or on 5th...but I don't want to be on 2nd with a 30 min walk from the park either!
To be clear, i can handle the 25% monthly housing expense/total income and several yrs of maintenance just fine. Can handle a 25% downpayment, and another 25% in liquid assets. But i do not have $1.3M sitting around in cash to throw at a unit.
Not all co-ops will crazy stipulations like liquid assets totaling 100% of purchase price. As you look at listings, check the financing requirements. If the coop says 80% financing is ok, they are probably going to have a much lower bar than some of the fussier boards.
Thanks Tom...are financing requirmements listed on Streeteasy, or are they otherwise easily discernible online?
The broker's listing on their web site will usually mention max. financing allowed. If you see a listing you like, you need to contact the broker (or have your broker do it) to get info on what the board's financial expectations historically have been.
As those expectations are pretty much non-negotiable, you need to get that sorted out first, because you don't want to spend the money and time on lawyers, due diligence, contracts, and board applications only to be rejected at the last step. Nobody wants to bring an unqualified buyer (for the board's idiosyncratic definition of 'unqualified') to the table. Least of all you, since you're paying all the upfront costs.