Can a trust buy into a co-op

Not going to be acceptable for most buildings. Doable for some "easier" boards, if handled carefully.

You almost certainly are going to have to limit occupancy -- i.e. "ACME trust owns this apartment, but only John and Jane Doe have occupancy rights."

Be prepared for a lot of negotiation and a lot of paperwork. I am happy to help you if you need it.

ali r.
DG Neary Realty

As Ali points out you will have to limit who lives there. So then the question is if you are going to live there until you pass and then it goes on to say your kids, if they want to live there then almost every coop board out there will force them to submit a package and then interview in order to live there. All that passes on is the shares in a corporation and not the right to actually move in.

You probably *can*, but most boards (including mine) would most likely won't even consider it.

Too many potential legal complications.

Case by case. Just depends on building. Frankly, some of the most prestigious buildings will allow it. But it will be more complex than normal.

This topic recently came up at my board meeting.
Is there any more information to read anywhere on this topic?
A Habitat article maybe?
Particularly the advantages if any and/or disadvantages to the co-op.

One very important question in particular, does a trust ownership work against occupancy rules for banks lending into the building?

We tried to do it (and live there as well), but the management company wanted a $1,500 fee to have their attorney look over the details of the trust. That was enough to make us fuggedaboutit.

1. the appellate court for Manhattan, the First Department, in Strauss v. 345
East 73rd Street Owners Corp., ___ AD2d ___, has expressly approved am
arrangement whereby a Coop Corporation requires purchasers to agree to
a restriction on use and occupancy as a condition of approving their purchase

2. that decision empowers a Coop board to limit use and occupancy of an
apt purchased by a trust to exclude children of the physical occupants

3. but two problems

4. first, the trust beneficiaries will inherit the apartment and be entitled to
its ownership in accordance with Will of Katz, ___ NYS2d ___ (NY Cnty.
Surr. Ct. 1987)

5. second, there are special provisions in almost every post 1982 Coop lease
which provide that children who inherit coops must be issued stock cer-
tificates and proprietary leases as long as they are financially qualified

6. those provisions have also been sustained by the First Department

7. altho the inheritance provisions apply to all shareholders, their applica-
tion is more imminent when people buy an apartment to die for (in)

1. the appellate court for Manhattan, the First Department, in Strauss v. 345
East 73rd Street Owners Corp., ___ AD2d ___, has expressly approved am
arrangement whereby a Coop Corporation requires purchasers to agree to
a restriction on use and occupancy as a condition of approving their purchase

2. that decision empowers a Coop board to limit use and occupancy of an
apt purchased by a trust to exclude children of the physical occupants

3. but two problems

4. first, the trust beneficiaries will inherit the apartment and be entitled to
its ownership in accordance with Will of Katz, ___ NYS2d ___ (NY Cnty.
Surr. Ct. 1987)

5. second, there are special provisions in almost every post 1982 Coop lease
which provide that children who inherit coops must be issued stock cer-
tificates and proprietary leases as long as they are financially qualified

6. those provisions have also been sustained by the First Department

7. altho the inheritance provisions apply to all shareholders, their applica-
tion is more imminent when people buy an apartment to die for (in)

Thank you IsleofL.
Well that kind of makes sense, in essence your including the co-op in your trust, it needs to be reviewed by an attorney.
No different than the other management fees such as reviewing a new buyer board package, etc.

RB345
My building already has a provision that you can pass your apartment's ownership on to your kids. They still will need to go through a a financial review to see if they can REMAIN in the apartment or need to make arrangements to sell.
A side agreement can be executed that this is still the case with the trust.

Still havent been able to find out the effects of trust ownership on owner occupancy threshold.

Any bankers or attorneys....Do financial institutions consider a trust ownership of a property that is occupied by the trustee as owner occupied for building threshold considerations?

I have seen it done recently in my building while browsing through recorded sales. The trust and the individual were both listed as parties on the buyer side. Paid with cash. It was a sponsor sale, though, and so the Board may wanted a different approach but had no real say. Don't know any other details than that.

truthskr10:

Most coops today have sufficient owner occupancy that the legal classification
of a truth should not affect ability to borrow