What are my rights when applying for approval by a COOP Board

You have the right to remain silent. Anything you say can and will be used against you in a court of law.
You have the right to an attorney present during questioning. If you cannot afford an attorney, one will be appointed for you.
Do you understand these rights, because if you are seriously purchasing in a co-op, the rest of your life, instead of having your own home you will have to answer to this co-op board who has already proven unfriendly?
Do you understand that when you purchase a co-op you are not purchasing real property? Why would you purchase shares and a lease in a co-op when you could actually own real property?

One month is a fairly short time , especially in the summer when the full board or even a majority is unlikely to be around. In re: your rights, you have none. The board holds all of the cards. They will move at their own pace and make a decision that you may love or loathe. Unless you have videotape of their discussion of your race, sex , or some other federally stipulated civil rights violating attribute, you cannot do shizzle about it. Just one more reason to avoid coops.

"you cannot do shizzle about it."

Fo' shizzle, dizzle...

But what about mortgage issues? presumably a buyer could find themselves with their board package not being reviewed and the time running out on their bank/mortgage situation...?

tough luck....

to answer an earlier question, the reason ppl buy coops is that they are less expensive than comparable condos. I guess you get a discount for putting up w. all that BS...

You may come to the point where you realize that the foot dragging board has made your life easier by either rejecting you or causing your financing to fall apart (if you were sharp enough to keep the mortgage contingency clause !). If either of these happen, you've got another chance at avoiding the coop trap. Remember, if it's hard for you to get in, it's even worse when you decide to sell. Look for a well run pre-war condo.

Girl - all it says that you haven't heard anything is that your broker is not doing their job. Boards are typically 5-7 people who have full time jobs doing something else. Factor in summer travel schedules and it is very challenging for boards to quickly review and respond to your application. That said, your broker should be putting pressure on the board through the managing agent (good brokers know how to do this without being a pest). I have purchased 2 co-ops in NYC and while the process was nerve-wracking at the time (clock running on mortgage commitment, will they like me insecurity, etc.), in retrospect it was a blip on the radar of life and I have greatly enjoyed both apartments.

Despite what some others have said on this thread, the coop has limited impact on your life once you are in. You can generally undertake any reasonable renovation to your property and are free to enjoy your property as you see fit without imposing any negative impact on anyone else's right to do the same. I have sat on 2 boards and we have always made an effort to make a decision and schedule an interview within 4 weeks, max 6. 90% of the decision is around your ability to afford the property and demonstrate significant assets for the shareholders to go after should you default on any financial obligation to the coop. The interview, in most cases, is typically a formality. Congratulations, and good luck!

"Rights"?? Not so many.... As OTNYC says, somebody should be asking about the status, but some boards and Managing Agents are sticklers about such contact. Your agent should check with seller's agent to find out best way to inquire-without-being-irritating. Sometimes it is a simple inquiry from one of the agents to the Managing Agent; sometimes it is best for the seller to informally ask a friendly board member when you will hear something about timing; sometimes you will be told nothing because someone is struggling to get a pain-in-the-butt board member to review the materials and sign off.

You particularly want someone from the coop to state that your application is complete, instead of waiting 5 weeks for someone to ask you for another month's bank statements (or something simple). At the end of the day, the seller should be as anxious as you to move things along, and is usually better positioned to do so. Your agent should be all over the seller's agent until you hear something. Good luck, indeed!

Too much bs to contend with. I would never, ever buy a Coop, I don't care how much less expensive they are.

How much time does a condo board usually take to decide whether to waive its right of first refusal?

Right on OTNYC.

I love my co-op, I love my co-op board, I love my building's staff, I love my building, I love the flowers outside my building, I love the fake flowers inside my building, so I always get a little sad when people dis co-ops :(

If you love pre-war buildings on the Upper East Side, you might very well end up in a co-op, too. There are a lot of lovely ones.

girlincontract, get after thy agent! That person is supposed to do the checking and whatnot. Ideally said agent already had a working relationship with that board before you ever submitted your package.

{Manhattan real estate agent.}

Be careful -- if you are capable of using the word "rights" here, your attitude might lead you to a board rejection.

None of the board members is paid to do an extremely time-consuming job which includes vetting your financial and ethical character AFTER the managing agent has thoroughly checked your references and your employment letter to make sure they aren't fake. They are volunteering their time in the service of the building, and they don't owe a potential purchaser anything other than courtesy -- which one month certainly doesn't violate. Have your broker press the seller to check in with the board, but just be patient and give it another month.

Take heart in the old college application rule that rejections come quickly and approvals come slowly.

ali r.
{downtown broker}

i would check first with the managing agent. had one that didn't bother checking the board package for 6 weeks because the next meeting was in 8 weeks. this was right at this time point. the board had to schedule the "interview" the day off because of the delay in receipt of the package.

i would have the seller, nicely, inquire from one of the board members in they received the package and take it from there...

Signed contract and submitted board package for a Coop beginning of Feb, have not heard anything from the board yet...Broker suggested to wait, because the board might feel "pestered" if asked for their opinion. The apartment needs gut renovation and by now I'm very pessimistic about this process..How long will I have to wait until they decide about my renovation plans..Also, if I want to sell this apartment in the future, how long would it take when even in my case (all cash buyer) they can't make up their mind.
The whole process has been terrible, their demands have been extremely intrusive, my first (and last) attempt to buy into a Coop, what an unpleasant experience.
Now my broker tells me that the board will meet end of next week to discuss my application for the first time!
If I could only would walk away and search for a Condo instead, but as far as I know I'm not entitled to leave..

Those who bash coops know little about coops as evidenced by the statements posted above. In fact, there are many advantages of owning a coop over a condo as was pointed out in many articles including a NY Times article last year. Search them out for yourself and do your own research- do not rely on these unsubstantiated claims made by others. Forget theses losers and once you buy, you will be happy you did and the board will protect your interests.

There are most definitely advantages to coops for many buyers leading many to exclude condos from what they would consider purchasing. On the other hand, a building with a slow board may not be one you want to be in. This is a case by case thing and not one given to broad generalizations. That said, over 2 months of waiting is excessive and I would push to get some indication of when a response might be expected. This time of year there are not holidays to delay things, summer vacations, and for most buildings this is not board-election time of year. This should really be the time of year to see the quickest turn around time. You have no "rights" to speak of for the most part, but I do think pressing for some indication of the application's status is appropriate, and I am not someone given to hot-headed actions. Good luck. If you anticipate a gut reno, brace yourself: they are full of such frustrations, but then again, the payoff of an incredible customized home can make it all worth while in the end.

Thank you, kylewest. I guess I'll have to wait now until after their meeting next Friday.
I'm certainly a bit nervous about the gut reno, especially since it's the first time for me:)
Btw, does it require another board meeting to get approval for that?
I know it's the contractor who will take care of it, but I'm concerned about the waiting time..

It will require another board meeting and a full review of the plans by the building architect. Be prepared, it's a long wait and everything you do will be carefully watched for everyone’s benefit.

To clarify, the board may have to meet again, but not with you present. Your plans will be submitted by your architect to the building engineer for review. The engineer will go back and forth with architect to clarify/tweak some things, and then refer matter back to board when all back and forth with architect is done. Board will then approve or disapprove plans with remarks on necessary alterations to plans and sometimes (in most buildings) with explanations if requested for their positions. For example, an engineer may say the plans are sound from engineering standout, but the board will have to decide if expanding the wet areas (bath or kitchen) to incorporate an existing closet. The board may then say it has a fixed policy of no wet over dry so despite engineer's ok, they are declining to approve expansion of bathroom.

Kyle, thanks for the explanation. This is supposed to be my first NYC apartment, so I appreciate the heads up.
I would not worry about this process so much if I had the impression that this board is somewhat reasonable and responding in a timely manner, but in this case I guess there's no way I could move in before 2011..
But there's still a chance it won't work out and then I'll know what to avoid next time.

153, what's the seller's role in all of this? Is the seller eager to get out, or might they be dragging their feet for some reason? Can the seller press the board a little bit?

Are you dealing with a small building or a large building? Professionally managed or self-managed? Anything contentious come up in your lawyer's review of the past board minutes?

lad, the seller is very eager to get out (tenant left in December and maintenance is high). He was happy to find a cash buyer and tried to press the board twice, as far as I know.
It's a small building (50 units), professionally managed, but the broker had a hard time to get a response from the management several times.
My lawyer didn't report anything contentious to me.

"Despite what some others have said on this thread, the coop has limited impact on your life once you are in. You can generally undertake any reasonable renovation to your property and are free to enjoy your property as you see fit without imposing any negative impact on anyone else's right to do the same. I have sat on 2 boards and we have always made an effort to make a decision and schedule an interview within 4 weeks, max 6. 90% of the decision is around your ability to afford the property and demonstrate significant assets for the shareholders to go after should you default on any financial obligation to the coop. The interview, in most cases, is typically a formality. Congratulations, and good luck!"

WORD.

I'd also like to remind applicants that in this day and age of immediate gratification thanks to technology (email, texting, cell phones, etc.) to keep things legal boards still need to meet IN PERSON to discuss your application.

As I've posted before, I allow 48 hours to pass after I receive an application before I gently prod my fellow board members into setting up a date to discuss. If we're less than two weeks away from a regular board meeting, that's when it will be. If we've just had the board meeting and worse comes to worse, we'll discuss it a month later at the next board meeting.

90% of the holdup with "the board" most often is incomplete or vague information in the application. It's your broker's responsibility to ensure all the i's are dotted, the t's are crossed, and any potential red flags avoided before sending the application onto our managing agent, who then distributes it to us (this process alone can take up to two weeks).

"I would not worry about this process so much if I had the impression that this board is somewhat reasonable and responding in a timely manner, but in this case I guess there's no way I could move in before 2011.. "

Don't be such a drama queen. It's barely been three months.

*****

"signed contract and submitted board package for a Coop beginning of Feb, have not heard anything from the board yet...The whole process has been terrible, their demands have been extremely intrusive ..."

If you haven't heard anything from the board, how can they have been making "intrusive demands"?

NYCMatt, first you give me hope ("the coop has limited impact on your life once you are in"), then you call me a drama queen :)
Apparently you're doing a very good job as a board member, avoiding unnecessary delays. But on the other hand you don't seem to find it unusual that " It's barely been three months" until the board I'm dealing with decides to meet to discuss my application.
Since this apartment would need a gut renovation (and summer is ahead, the slow months for board meetings I've been told) I think it's only realistic not to expect to be moving in in 2010.
You can call me naive if you wish, for not expecting the whole process to take so long. For me it's rather difficult right now to adapt my plans accordingly.

"If you haven't heard anything from the board, how can they have been making "intrusive demands"?"
It's my first board application. I found several questions on the forms I received in the beginning unnecessary and intrusive.

153, if they're truly meeting to discuss your app next week and your app is complete, you should expect word (either request for an interview or rejection) a few days after that. Have your agent follow up if you don't hear anything.

Your interview date will probably be about a month after that, and approval usually comes within a couple of days. After that, you can close within a week if all stars are aligned. You will almost definitely close within 30 days of board approval. You can submit your renovation plans to the board on the day you close.

So, as frustrating as this process has been, you're probably 40-60 days away from ownership. As for the renovation, that's anyone's guess. Good luck!

Thanks for the encouragement, lad.
I don't have access to the apartment before closing though, so there's no way I could submit my renovation plans on the day I close.
My other option was a renovated Condo, and while I favored the prewar charm of the Coop in December, I was way too optimistic about the implications of this decision.

"I found several questions on the forms I received in the beginning unnecessary and intrusive."

Questions like what?

Who else (other than the owner) would receive a key and have access to the apartment?

"Who else (other than the owner) would receive a key and have access to the apartment?"

Well, as someone who would be sharing a roof with you, I find this to be one of the LEAST obtrusive questions. It's MY building too, and I have a right to know who will be roaming the halls just a door's thickness away from my wife and children.

O.k., good for you. But unfortunately I am the applicant in this case and I don't appreciate this kind of "protection".

And I have a right not to know ANYTHING about your so-called "wife and children" lurking only a door's thickness away. What you do in the privacy of your own bedroom is your business, but I don't see why you need to flaunt it in front of everybody else.

Besides, don't you mean "husband and children"?

it's not for the protection of the applicant, it's for the protection of the other tenants currently in the building who are all paying hundreds to thousands of dollars a month for maintenance.

I know, alharris, there's no protection for the applicant. He has to reveal everything and hope to be accepted be "the club", his future neighbors, he knows nothing about. Only then, when it's too late to leave, he will learn what kind of club he joined.

Just read some of your other comments, alanhart (this one made me curious), and thanks to your humor the sun is shining again.
I'll have to tell the board that I plan to hang a flag out the window:
"I <3 alanhart"

"I (heart) alanhart"

"I know, alharris, there's no protection for the applicant. He has to reveal everything and hope to be accepted be "the club", his future neighbors, he knows nothing about."

It's not anything the OTHER members of the "club" haven't gone through.

You're not so special that you can circumvent the process.

Cycle of abuse: It's not anything the OTHER members of the "club" haven't gone through.

I prefer "rite of passage".

And if the OP doesn't like it, he can stick with condos or houses.

alanhart just nailed it.

Kylewest, what are the advantages of owning a coop over a condo? I can't think of any (other than pre-war design). Are there financial or transaction cost advantages?

"what are the advantages of owning a coop over a condo?"

On the practical side, you have a degree of control (through your co-op board, on which you are free yourself to participate) over who your neighbors are.

On the financial side, there are a number of advantages to the apartment not being "real" property.

We did not rule out either, but preferred co-op to condo, primarily because we are debt-averse people who didn't want to buy into a building with overleveraged borrowers.

It's nice to know your neighbors have at least 20% of the purchase price down, a regular mortgage, and some post-closing liquidity. The chances of default and a "fire sale" in the building are much lower. In the case of default, any past due co-op maintenance is paid before even the lender, meaning you're not dealing with having to absorb months of unpaid common charges in the event of a default. Strict sublet policies preserve the owner-occupancy ratio, and therefore buyers' ability to get mortgages (and your ability to sell).

Some would also view a co-op's ability to take on debt as a plus, though I do not. (I think underlying mortgages, which are often interest-only balloon mortgages and which frankly most buildings have no realistic plan to ever pay off, are actually a disadvantage to co-ops.)

The selectiveness over neighbors is, except in extreme cases, not a concern of mine nor something I'd consider a benefit.

In terms of transaction costs, no mortgage recording tax (for the time being) is nice.

@ downtownsnob: I think there are distinct advantages in terms of quality of life in a coop where greater control is exercised over the environment in which all "cooperate" to live. I do not like open-door policies to renters. I did not pay an arm and a leg to live next to short-term tenants, students, drug addicts, chronic party throwers, discourteous or inconsiderate people. When you have no "skin in the game" you don't care as much about a place, and renters have no skin in the game. They are more apt to drop wrappers in the elevator, toss newspapers all over in the garbage chute closet rather than take time to stack them up. I could go on. Condos permit endless rentals by every owner if that is the desire. Coops do not. Coops are for owners primarily with very few exceptions. Owners tend to be mmore considerate of one another and make for better neighbors.

If a problem emerges, a coop board can take action more easily and quickly in terms of imposing fines or taking other corrective legal action. Condos have less control.

Now, someone is sure to pipe up about an out of control coop they once lived in, but in truth most are well-run and without significant drama. At least the coops I've lived in. I enjoy the selectivity and feel happy and safe when I come home and love the environment of the building. For me coops are a good fit. That said, for a variety of reasons, condos are better for other people. I don't think one size fits all.

@downtownsnob,

you're on the other thread where there's this poster who wants to spend $4.5 mm, but doesn't want to be in a building overrun by renters? Well, what condo could promise that? That's a major advantage of a co-op, the population of the building is stable and you get long-term neighbors. Living in a condo (I've owned both) can feel more like living in a dorm.

ali r.
DG Neary Realty

some people are slobs; some people are inconsiderate of others. i am neither nor was I when i was renting. i have lived in a coop with many inconsiderate slobs. ownership does not miraculously change people's habits.

Ownership is not a "miracle cure" CC, but it is one way to hedge bets. I like there being checks (as in "checks and balances") in place when it comes to who my neighbors/fellow owners will be. Coops are a good fit for me. I would be very uncomfortable with the permissiveness of condo rules as they don't serve me and my living/financial situation in any discernable way and in fact carry risks I would rather live without.

fair enough.

I'm thankful I've never had any bad experiences as a renter. I made it a point, however, to avoid buildings that allow temporary walls, are close to the big universities, or have floorplans obviously designed to accommodate as many students/starving artists as possible.

Renter or owner, I think most people want to live among people like themselves. Although I preferred co-op to a condo, even more important was finding a unit with an average number of shares in a building with a relatively low variation in square footage. I didn't want to be either the runt or the chief shareholder, or deal with the politics that come from odd share allocation. (We saw more than a few buildings where the maintenance differential seemed punitive to either larger or smaller units.)