Condo Board Applications

I never heard anything like this. Are you sure it's a Condo not a Condop? Are you buying or renting?

OP here. I am buying a CONDO. There is no doubt that it is a CONDO, not a Condop or Co-op.

When I called my broker, who I specifically told that I am not looking at coops because I don't like the privacy invasion, she just shrugged and claimed that "all of the condos" are doing detailed packages now. Of course, she never mentioned this earlier.

My attorney was astonished by the level of detail the condo board requires. But I think he missed something in his diligence. Shouldn't he have been able to figure out the condos requirements before finalizing the contract?

I beleive the person selling this to you should have definitely informed you of this. I don't see how it would be the responsibility of your attorney. I have to put 100% responsibility on the broker.

Ah, well, the price of living in the city.....

So now you're stuck ! ? ! You did sign the contract but under 'false pretenses' though I guess your complaint is really with your own team not the sellers'. Is there no way out? However, I guess the more important question is, will you face this type of scrutiny regardless of what type of property you want to purchase in NYC. Anyone?

I had the same experience in purchasing a condo. I found that many require this sort of review, although few were as onerous as the original OP's experience. In my experience, the application was always referenced in the contract, so I knew before signing. If you like the condo, I would just suck it up and negotiate the broker's fee down (since he dropped the ball). And remember, as you mentioned, it's just a right of first refusal, and the building only buys the condo if the price is way too low.

To OP. Though some of what you've detailed above seems a little much, it's really not all that unusual for a Condo in NYC these days, particularly for older Condo's (very new construction).

Question.......so the only right the Condo Board has is the right of first refusal, then how can the board or its agent hold up the application or deny the application no matter what you put down, even if it is not to their liking????????

The condo board can deny you however they will have to buy the apartment under the same terms. Unfortunately, most condo purchase packages are very similar to coop packages unless you are purchasing from the sponsor or in a new development, then there is no package at all.

I bought a condo and while it had some elements of these items, it was not as onerous. Only had recent bank statements, commitment letter, 3 letters of reference, and employment letter - no tax returns or paystubs.

I was told mine was pretty typically. Yours sounds very extensive. Generally - I dont think tax returns are standard and the number references cited here sounds onerous.

Why have condos started requiring so much information? Do they really need so much data to decide if they want to exercise right of first refusal? Some people just don't want to share every last detail of their financial life with the condo board, the buildings management agent, and heavens knows who else.

I'm waiting for the day when an identity theft ring starts operating out of a property management company or real estate office. You hand over so much information (social security numbers, bank statements, letters of employment, tax return) that it would be fairly simple to steal someone's identity.

So given the right of first refusal....what happens if you DON'T provide all the info or the correct info....could they deny your application? what are the consequences to the purchaser?

I am really surprised that a Condo would require so much information. While possible that your lawyer could have found out that the application was so stringent during due diligence, I do not think it is his or her fault in this instance.

An option for you may be (consult with your lawyer first) to submitt a deficient application, basically providing only what information you are willing to and be willing to roll the dice about approval. This way you are honoring the terms of your purchase agreement and not putting your deposit at risk but allowing yourself to take a stand as to what you are willing to provide. This strategy only makes sense if you are willing to walk away from the deal.

I just went through the approval process for a coop and they were not as stringent as your coop. What a pain in the butt.

OP--what, you in the mafia? just give the shit they want or shut up. once you buy, its public record anyway.

#14 if you do not provide a completed package the board president will not sign off on the approval and you will not close.Also, the lanquage in the contract may read that you agree to submit a board package in good faith.

OP here. Of course I am not in the mafia. I am simply a private person.

While the purchase price will become public record, my tax returns and bank/brokerage statements do not. This is private information that I do not wish to share with my real estate broker, her manager, her secretary, a half dozen members of the condo board, several representatives of the management company, and whomever else may handle it along the way. Not to mention, I have been given no assurance that this information will be kept private or safeguarded.

Also, I don't like bringing my personal life into my professional life and didn't want to tell my HR rep or several colleagues that I was buying a condo. But I have to in order to get the leters and paystubs required.

If Condo most board packages are this detailed, why didn't my broker or attorney say something when I told them that I was only looking at condos because I wanted to avoid the invasion of privacy of a coop package?

Dems da rules! Anyway yours has a little bit more - i.e. tax returns, but the rest is probably just a comprehensive form of other condos require (some ref letters, some brokerage forms).

Listen - that's life - everyone else had to ask HR etc.!

The milk of human kindness, 19........... Sadly it appears that your team, your lawyer & your broker, dropped the ball; whether it was their not paying attention or their thinking, "She's a nut but we'll railroad her & still get our money', I don't know. Perhaps you'd encounter this situation anywhere you wanted to buy in Manhattan, I'm not sure that's been made clear in the posts. One consolation is that people go through this every day to purchase property in the city & the info seems to be safe even if the process is quite invasive. Sorry this happened to you but I do wonder if it is just part of the process.

OP, a lot of this information is also required for many rentals. When I rented my first apt in the city I had to provide an employer's reference, plus former landlords, and my last 2 months bank statements. And this was 10 years ago. I hear it's gotten worse with such a tight rental market.

I just purchased a coop so I'm familiar with this process; I was told that the board and real estate agents are bound by law to keep your info secret. If course you never know but I did receive additional assurances from the board members I met with - if any info is leaked and they trace it to the board or realter they can be prosecuted. They see so much of this info that nobody really cares. It's prob the same for condos but you should check with your lawyer on this.

Sure it sucks but if you don't like it then move to Cleaveland.

I agree with the OP. I am also a private person and I think that any board requiring this information is ludicrous. I can understand a coop needing additional information, but a condo? Come on. The only institution that should need the OP's financial information is his mortgage lender. We as real estate buyers/owners need to put an end to these intrusions.

I think the condo (and coop's) concern is correct. They want to be certain you can carry the place w/o going into foreclosure at which point there'll be a trail of people viewing the place, asking questions, buyin gon the cheap, renting out to god knows who, and depressing their investment (potentiall). If this intrusion does not appeal to you, sue the attorney and move to Garden City.

They may also want to make sure you earn a legitimate living, not a drug dealer or prostitute. Some condos have had problems with such people residing there, talk about depressing property values!

I've noticed that many condos are requesting more paperwork for individuals taking on a mortgage after the massive problems with subprime mortgages.

#25--Condos where? Subprime mortgages are those for people with extremely poor credit, not just bad credit--generally FICOs less than 550. Highly doubt this applies to manhattan condo purchasers.

#26, it's not just the subprimes affecting Manhattan condos - it's people with less-than-stellar credit who don't fall into the 'subprime' catetory.

These folks wouldn't qualify to purchase coops but may have been able to get mortgages to purchase condos. and previously condo boards didn't care but now there's more concern...what would happen if someone had to foreclose, couldn't pay mgt fees?

To OP - Uh, did you do ANY research on your own??

Would someone who knows what they are talking about with authority answer the question..........opinions are useless.

WHAT CAN THE BOARD DO IF THEY DON"T LIKE THE APPLICATION OR THE APPLICANT, OTHER THAN EXCERCISE THE RIGHT OF FIRST REFUSAL???????

So why is everyone so concerned about giving them more than is absolutely minimal for identification, so the applicant can say he applied.

Condo Declarations don't include any right to approve or deny approval.

Would someone who knows what they are talking about with authority answer the question..........opinions are useless.

WHAT CAN THE BOARD DO IF THEY DON"T LIKE THE APPLICATION OR THE APPLICANT, OTHER THAN EXCERCISE THE RIGHT OF FIRST REFUSAL???????

So why is everyone so concerned about giving them more than is absolutely minimal for identification, so the applicant can say he applied.

Condo Declarations don't include any right to approve or deny approval.

Condobuyer07 - Please stop shouting. These boards can be used for opinions last time I checked. Essentially, who made you god of the board?

As for an answer, here is one: what the board can do - they can simply deny you the right to buy based on you not submitting the appropriate information as is required by their Condo guidelines. Can they do anything else, not really. But, the buyer could lose their deposit if the seller chooses to say that buyer has not compleated the application in good faith. So there you go.

seconding what #31 said--there is a risk of losing your deposit.

The approval appears to require an application. The application includes x, y, z items. I would guess if you do not include x, y, z items - it will delay your application, as they will come back to you for it. And if you do not submit it, your application is incomplete until then. Approvals are granted on complete applications I would guess.

Condo buyer: you MUST contact your lawyer. This message board is not the appropriate place to receive legal advice. What you will receive is everyone's opinion.

This is #31 again. Exactly true #33. They will not approve you, nor do they need to even review your incomplete application. If you don't mind losing your deposit then you can certainly go this route. If I were the seller, I would come after you for this. You are right to be angry at your attorney and broker for not showing you the condo guidlelines prior to your signing the contract. Having said this, you should have also specifically asked for them if this was an are of 'deal breaker' for you. You're definately in a pickle and you need to choose which is worse - losing your deposit or getting reference letters, etc. Sorry, it really does stink.

Separate question - but anyone heard of the condo board exercising their right of first refusal. What were the reasons?

I feel your pain. I am in contract to buy my third condo now. In the past, my application consisted of my executed contract and my committmenet letter from my lender. I was shocked by how much information I had to submit for my latest purchase.

The condo I am selling instituted a more deailed package a few years ago. They have not once invoked their right of first refusal. The board knows full well that unless a buyer is planning on running a daytime meth lab/nightime speed metal rehersal studio/weekend methadone clinic out of their apartment, the building will not tolerate a special assessment to buy the apartment. So why the increased scruity? IMO, it is because as real estate prices have risen, long-term owners have become incerasinly curious as to the source of wealth for new buyers. They are simpyl fascinated by how someone can afford to spend millions on an apartment and are curious as to how the buyers earned/amassed their wealth.

Of course, they don't need this much information. A condo board isn't going to invoke their right of first refusal because you can't afford the apartment. The looses to the condo if you fail to pay your common charges and the potential damange to your neighbor's investment of your apartment is foreclosed is TINY compared to the costs and potential losses your neighbors would face if they exercised right of first refusal.

Think about it: What happens if the board fears that someone buying a $1MM apartment may not be able to pay their mortgage or commin charge and invokes the right of first refusal? They make a special assessment to raise the purchase price and buyer's closign costs. The building then pays the commin charges AND real estate taxes while marketing the apartment for sale (the same expenses they were concerned you wouldn't pay). They then sell the apartment, paying the sellers closign costs. If they can sell the apartment for $1MM, they lose almost $100M in closing closts. Do you know how long somone would have to skip out on their common charges to equal that $100M? A decade? Or maybe the unit sells for less than a million and the neighbors lose a lot more. Compare these costs and risks the likelihood of someone having their apartment foreclosed upon (have you seen the foreclosure rates in Manhattan?).

It sucks. I know. And I would be furious with my lawyer if I were you. Not all condos are like this and you deserved better counsel.

Once she gets this purchase horror behind her(?) what recourse does she have to go after the attorney. I don't know that there would be damages awarded but a strongly worded letter to the legal oversight board (what's the name of that group?)is certainly in order. Better not alienate that blunderer before you get this purchase situation behind you, though.

I don't don't fully understand why it is solely the lawyers fault. When you received the offering memo, didn't you also receive the bylaws and house rules, along with details on board package? I certainly did. Anyway - you can blame lawyer - but not sure sue! I think you can also blame yourself - you didnt look at these items?

There is only an OM if you are buying new construction. Otherwise, the bylaws, financials, and minutes are requested by your attorney when they are doing their due diligence. It is the attorney's responsibility to advise and inform their client.

If the attorney didn't do his/her research or didn't reconcile the buildings's requirements with the client's stated wishes...that's they attorney's failure. Not the buyers.

#39, who exactly was reviewing your application? If you had an offering memo, you were buying new construction. There is no board in place when you buy new construction. So who would make the decision to exercise the right of refusal? The only body who could make that decision would be the sponsor or their managing agent. But the sponsor wouldn't exercise right of refusal, because they are selling the apartments...they have no incentive to purchase their own apartment from themselves. They simply wouldn't sign the contract.

My understanding is that with new construction, you dont even have a board approval required.

It sounds like it was an existing condo then - which would then have house rules, by laws, etc. and would list details for approval package. Suing is drawn out and can lead to failure - we are too damn litigious in this country anyway. Anyway - good luck!

Count your blessings. I am in contract to buy a condo and am currently trying to schedule my closing. I submitted a package. Now the management company won't clear my closing until I sign and send them a lead paint disclosure and an affidavit that the apartment contains the required smoke detectors and carbon monodixe detectors. I keep trying to explain that these are documents that are for the seller to sign and that I (the buyer) can not possibly know if the apartment contains lead paint or smoke detectors (seeing as I am not in possession of the apartment). But they are too stupid to realize their mistake. The sellers have submitted this paperwork, but the management company wants the same paperwork from me.

Lala girl - the same thing happened to me. I had to sign regarding smoke detectors. I got a notary to sign and sent it within hours. Just get it done (sadly) and you will be done. I hear you - it is meant for owners (which you are not until you close i know).

But how can I affirm that the apartment contains smoke and carbond monoxide detectors? I don't know that it currently contains functional smoke detectors. I didn't test them when I viewed the apartment. And even if I had, they could have stopped working between then and now.

If I do sign the affidavit, I will be perjuring myself. Why should I have to do this to please the management company?

You are probably right - I think you will be fine. I took the slight risk and wanted to be done with it. Your route will take longer but it is fair and honest. I hope they dont delay you too much. I remember waiting.

lalagirl... i was told by my future property manager to inspect the property prior to closing. during the inspection, i have to note if a smoke detector is there... if it was working properly... and since it's a new property, no need to worry about lead paint. that's all u need to do. call ur lazy broker to arrange an inspection of the property.

To OP, if you truly want to keep completely private, I recommend getting out of this deal and buying a new contruction condo - that is, if you are able to and if you don't mind giving up the unit you purchased.

#47, I am not buying new construction. The condo I am buying is prewar and it is very possible that there is lead paint in the unit. I did not pay for a special lead paint inspection, because neither my desire for the unit or the price I was willing to pay hinged on the existence of lead. While I will do a walk through, my walk through will be the day before closing. The management company will not allow the closing to be scheduled until I provide an affidavit that the apartment that I don't own and control contains working smoke detectors.

I will not pay for an inspection just so I can verify that a smoke detector exists. First, it is the seller's responsibility to affirm that there is a smoke detector. Second, I won't get anything else out of the inspection. I am in contract. I can't add repair work or modifications to the apartment to the contract.

lalagirl, the affidavidt is for you to confirm that the smoke detectors & lead paint stuff are addressed so that you don't come back & sue if something were to happen.

sounds like a catch-22 here - most people just sign this stuff and assume it's all taken care of. But it's not unusual for a buyer to have access to a new place before the close, for reasons like inspecting for a smoke detector or taking measurements for new furniture. I'd have my lawyer insist you have access to the unit before signing these so you can go ahead & close.

sounds like lalagirl doesnt even want to do that. why dont you get the seller to pay for the inspection? is the cost the issue. if you want to close seriously, i would just do what you have to at this point. you are in contract.

#51 & lalagirl, why would the inspection cost $$? just get access to the place and make sure the smoke detector is working.

as for who pays for the lead paint inspection, should have been worke out in your contract. CALL YOU ATTY.

I would have to pay for an inspection because in real-estate-ese, an inspection is when a professional inspector evaulates the soundness and integrity of a home. You pay for this service. For me to go to the condo to examine it is called a walk-through. I could do a walk through. That would not be a problem.

But I still couldn't sign the affidavit that there is a smoke detector. That document has to be signed and notarized by the grantor (ie: the seller) BEFORE it is signed and notarized by the grantee (ie: the buyer). Because this document is not required of the seller until closing, I will not have a signed and notarized copy before then. So for me to satisfy the management company's requirement BEFORE CLOSING, I would have to countersign a statement that seller has affirmed to me that there is a working smoke detector. Which they have not. See the problem? I wouldn't hold up a closing because of a $10 smoke detector. The issue here is that I can't sign as the grantee until the grantor has signed.

I could not care less about a lead inspection. If I did, I would have had one. I don't care if there is lead paint in the apartment or not. If I have children, I will pay for a lead inspection regardless of what the seller claims about the apartment. If they swore on a stack of bibles that there was no lead paint in the apartment, I would still get a lead inspeaction. The managing agent is requiring me to submit a lead paint disclosure. That is the seller's reponsibility, not the buyer's. I can only make a statement about lead paint based on the disclosure of the seller, which I don't have.

The issue here is not cost. It is that the managing agent is holding up the closing by requiring the buyer to submit paperwork that is the seller's responsibility at CLOSING. They are saying that I can't close until I provide paperwork that is exchanged at the closing. My lawyer has spoken with the managing agent several times. They simply won't admit the mistake.

The only option is for the sellers to do their closing paperwork before the closing is scheduled, for me to countersign, and for the paperwork to be repeated at closing because it is required AT closing. That is just a waste of time and money.

I signed earlier that i had the same issue - but i didn't get in a pickle and took the risk and signed. . .building was 1982 though so not sure if lead paint was an issue.

Do what you need to do - good luck with the closing timing.

So funny and so sorry to hear that lalagirl. Saw the same thing recently for a condo in the LES that my friend purchased.

As onerous as any coop app.

But fortunately, it's usually the exception. I'd say this article explains what a typical condo app and process would look like:

https://www.hauseit.com/the-condo-application-process-in-nyc/