Actual Liquidity Needed

(I'm not making any kind of statement about the pricing of that particular apartment. I just picked it because the numbers were easy).

Something I didn't take into account was that you can deduct taxes on the interest for the mtge portion. So that would make the mtge+maint actually closer to 30K-60K?

wishhouse, the only caveat that i'd add is that despite what some say here many coop boards do wind up compromising during a downturn. counterintuitive, on some levels, but they may become more concerned about job stability and prospects than savings if they have numerous people who aren't paying the maintenance. Plus, they need to keep a full house, and if someone isn't paying it may be better to "make an exception due to extraordinary times" than not allow a sale.

Sadly, just as many things in life, there is a huge amount of resistance, and then capitulation when things are further down the (problematic) road.

Hold your nose and let it happen.

That's certainly true, but I for one wouldn't feel comfortable putting all my savings into the down payment/closing costs. In my example, you'd have 30-60K in the bank after closing.

I would agree with aboutready, up to a point, having sat on a coop board a few years back. Then, we were less concerned with liquidity than the salary to price ratio and--to some extent--job stability and no fancy newfangled mortgages allowed. Then, however, the employment market was very good. Now, I would probably lean to job security and liquidity over salary. Some Coop boards are more vulnerable to pressure from fellow shareholders to compromise than others, in a small building (for example) you have to answer more directly to your shareholders.

wishhouse, I'm going to run your numbers on an apartment I'm wondering about right now -

$3mn x .25 = 750K. Plus 1.5 years of maint/mortgage = $3250 x 18 = $58,500 +13,300 x 18 =$240,000 = $1,050,000 + closing costs of 3% = $90,000 = $1,140,000. So if you're right I think I'd need about 38% of the purchase price in liquid assets, which is sort of what I've always thought.

The problem I'm finding is that it's not easy to even get a quote on a mortgage for the above scenario right now. Not meaning to highjack your thread here if you were talking about a smaller apartment where the resultant mortgwge wouldn't need to be a jumbo. But can anyone speak with recent experience about getting a mortgage the corresponds with the scenario I outlined above? And of so, at what kind of rates?

wishhouse, in an ideal world everyone would have huge amounts of savings. And I am not a fan of buying now at all. some of it depends on circumstance, family that could help without making you feel awful if needed as an example.

but i'm just saying that you may not be required to have what has been expected the last few years, one to two years.

familyguy, now we live in interesting times. it may become more difficult to find either. or any. coop boards can't be having an easy time of it right now. and you are quite correct in that there is a wide variety of coop board styles and tolerances.

No no, the more examples in different price ranges the better. I just didn't want it to turn into a discussion of the merits of the random apartment I picked. Unfortunately I don't know the answer to your question. On the place I posted, I just used the default mtge rate that came up, 6.5%. That's definitely another factor.

So, to add to your question, what do you all think the range of mtge rates would be on the listings posted? I will recrunch the numbers if someone gives me a range.

In an ideal world, I'd be looking at the kind of places that liquidpaper is looking at ;)

Or maybe to make the question/smore far ranging, even assuming one can get approval for given mortgage, in any of the scenarios what are (non Park avenue ridiculous) buildings looking to over & above this +/-40% of the purchase cost of net worth? I had always assumed that if I had that, and a demonstrable income that indicated I could carry the apartment costs, I wouldn't have a problem with the board, as long as I didn't fall to my knees and bark during the interview. But lately I have heard that while that might have been true once upon a time it no longer is, and that boards of reasonable, ordinary folk buildings are now looking for assets equal to, or close to the entire purchase price. Anyone have experience or comments on this?

wishhouse, you have to take my kids also if you want to have my apartment . . . ;) back atcha.

lp, yes your reports are correct. and good luck to coops looking for that. give it time. they may be barking for you next year.

one friend of ours was told that a cpw coop (2006, not over-the-top prestige) expected liquid assets of two times the purchase price to allow a mortgage. she said why the hell would we buy here if we had that kind of cash? and then found that it wasn't uncommon. now i don't think it will be, so much. tyranny like that can't exist in times like these.

lp, are your kids pretty great?

wishhouse: I know of quite a few co-ops that require 2 years of maintenance after the purchase. Does this info help you?

stakan, that's not the issue. the issue is for how long they'll be able to continue such requirements. wishhouse, does this into help you?

aboutready, yes they're pretty terrific all told thanks, and I actually wouldn't give them to wishhouse for all the tea in China, although he/she seems like a lovely fellow/dame. From some of your posts I think there's a small chance we live in the same building and know each other from riding the (very VERY slow) elevator together from time to time. but that's part of the fun of these type of websites isn't it?

aboutready, I'm not a big fan of buying right now either. But, when you're looking at apartments even casually, it's easy to fall into a trap where you think about what you can afford in terms of the down payment. (I think it's particularly easy to do this when you're talking about the lower end).

liquidpaper, the SO and I are thinking about kids, so maybe we could borrow yours for practice. you know, get our mistakes out of the way ;)

wishhouse, I apologize, i misread some of your post. i think the amount you need to feel comfortable youself depends on your resources, which I mentioned earlier (family that won't make you feel like dirt if you need help, and that have the means to help, are a huge bonus).

It also depends on whether you rely on one or more incomes per family, whether or not the areas are at risk. One of the many reasons I am advocating waiting right now is that it will be much less unnerving once unemployment truly stabilizes, until then it just wears on you psychologically if someone is at a place that has or may start "layoffs". Then you will still not necessarily feel secure, but you'll feel a bit more so, which I think could only be a positive thing. In the meantime, I seriously don't think that prices will rise (although there have been those recently who say that nobody knows anything,so take it with the proverbial grain of salt. Perchance prices will skyrocket in January, proving me wrong).

stakan- I was thinking that, thanks for the confirmation. I don't think it's unreasonable.

wishhouse, i don't think it's unreasonable. but in 1995 i got into a coop with 10% down and not a drop of reserves other than 401k (and two months maintenance in a checking account). things do change, not that i'm saying you should want to be the ultimate recipient of that.

lp, that would be so great. i generally show my better side in the elevator here. although you're very slow comment could apply to the elevator or to my conversational skills, do you live on 14 perchance?

no, eleven. and to the elevator alone my comment was directed. but if, as your last post indicates you're currently living in a coop than I am mistaken for certain.

I've been following this thread, and still wondering, how coop boards respond to potential buyers that don't have jobs. But are all cash buyers, with the purchase being, let's say no more than 25-33% of liquid assets. Anyone?

I`m looking for that $450K type apartment wishhouse was looking for. The goal was to have 90K for a downpayment, 10K for closing and $25K in reserve. Hopefully that gets it done. If not, it'll be another year saving up in Inwood!

no not a coop. that's in my past, sordid. i'm as sunny as can be in the elevator, generally. love the people here.

gaongaon, it's income, not job. Back in 2000 my building allowed a sale to a day-trader. He had to put 33% down, rather the 25% or whatever, and IIRC had to ante up a year or two of maintenance in advance.