Co-op Apartment Frustrations !

Typically would would have to resubmit your finances to the board to allow the purchase of your partners shares. Where is this cash for the purchase coming from? If the apartment is going to be fully paid off in cash then you are only worried about covering the maint/cc. Does your income not qualify to cover that? Would that debt-to-income ratio be under 28-30%? This may not be a problem as it will really deoend on how tough the board will be and your relationship with them.

If your financials are weak, it's not unusual at all for the board to reject your application.

We just had this happen in our building. The couple was forced to sell and go their separate ways.

This is why co-op boards are particularly wary of approving couples who aren't married.

Hi. Board president here. I can not say for sure how your board would handle this; but offer the perspecive of how our board would deal with it. A new application would be required. However, since you are already in the building, there would be a relaxed standard, assuming that you have been a good tenant/owner and the maintenance has a history of being paid in a timely manner. NYC Matt's perspective is the other side of the coin. It really is idiosyncratic to the board's philosophy on these issues. Good luck.

PS: I should add that if by "partner" you mean civil union domestic partner, you would be treated as if your were married, and be entitled to automatic ownership without further application or scrutiny.

Thank you both for your comments. I will be receiving outside help for the purchase of the other half of the apartment. When all is said and done, I will have relatively significant savings left - hopefully enough to convince the board. I calculated my DTI ratio for the maintenance alone - it hovers right around 29 to 30%. I do receive NY state STAR credit and my ratio with STAR is 24%. Though I'm assuming they don't count STAR in their calculation. Is that correct?

Oldgreyhair - Regarding your comment, unfortunately no, we won't be considered as such. We were simply in a very long-term relationship and living together for a brief period of time.

Hope to keep the place since I love it there!

One last thing - I'm rather afraid that this situation will look suspicious. The two of us were approved and bought the place literally a few months ago, over the summer. Unfortunately (and obviously) a drastic event that we couldn't have predicted caused us to separate.

I really hope it won't appear that I used her to get in. That certainly wasn't the case. Would you all recommend adding some sort of addendum to explain or will that only cause more suspicion?

NewBuyer,

Life happens. And things are in a constant flux. I do not see the need for you to initiate explanation of the change in circumstances.
If they ask, just state the truth about the separation happening because of personal reasons. Beyond that, the main issues the board should be concerned about are your finances and record as an existing owner resident.

GL. I really hope you get to stay in a place you love. I think that should be communicated (will not hurt for all those hard working board members to hear some positives about the building).

Automatic ownership based on marriage is over a death. Changing to a single ownership from joint is a transfer and most boards will require an application and financial scrutiny.

Someone down the hall in our building is going through this on a divorce and afraid she will not qualify on her own.

If you have a lot of savings cushion, I'd offer a few years into escrow and be totally open about the separation to the board member down the hall.

I think they will let you through, but if they don't, don't let them charge you the flip tax!

I would speak quietly to the board member who is your neighbor, and pose the question as "sadly, X and I are separating, so I'd like to buy him/her out -- what paperwork would the board need to see?"

At that point the board member will probably give you the lay of the land (unless they're relatively new, in which case you'll get a "I have to check in and get back to you."

ali r.
DG Neary Realty

Would this had happen if Newbuyer was in a condo ?

The fact that you've only been there a few months & now you've "separated" looks VERY suspicious. I don't know why they wouldn't want to look at your financials again. I'd be prepared to give them every detail of this separation & hope that they don't feel like they've been duped from the start. Good luck.

>>I will be receiving outside help for the purchase of the other half of the apartment. When all is said and done, I will have relatively significant savings left - hopefully enough to convince the board. I calculated my DTI ratio for the maintenance alone - it hovers right around 29 to 30%.<<

If you are receiving outside help you will likely need to show proof that the funds are a gift and not a loan, since any loan will be considered as debt, even if it is from friends/family. Also, the DTI of 29-30 falls above the standard 25% most co-op boards want to see. That alone could scuttle the deal for you. I think there is also a real concern that your board may look askance at the timeline--original purchase to buy-out request in only a matter of months.

Have you gotten to know your board members? Do you have a good relationship with your neighbors and are you in good standing maintenance-wise? If so your personal history in the building, albeit only a brief one, may be the thing that saves you. An appeal from someone they already know and like will go farther than an application from a complete stranger. If you can come to an agreement be prepared to put a good chunk of change in escrow (possibly as much as two years' worth of maintenance).

Oh, I see from your OP that you're already prepared to offer two years' in escrow. That is a good plan and should be taken very seriously by the board.

Thanks, all for the advice. To answer a few of your questions, yes, during the time I've lived here, maintenance has always been paid on time and without problem. I'm not exactly sure that they have a specific ratio - but I'll try to find out. I do think talking to my neighbor sometime soon would be a good idea.

I hope the money in escrow will work. We'll see. I know the board is also pretty strict on single young males - now that I am one, hope that won't play into it either. Eh, at least my neighbor has seen I don't throw raging parties ...ha.

Well, NewBuyer3, you must make a favorable impression. Look at how this vicious crowd of posters didn't make cruel remarks about your break-up, ask how long you'd been together prior to buying together, or ask what caused the break-up (tiny apartment, for example? renovation differences?).

Why I myself, figuring you were lesbionic, was going to ask what will happen to all the cats and hummus when your partner moves out, and whether she's already "married" the driver of the moving truck (Large Marge).

Godspeed.

Thanks, Alan for a good laugh this evening. lol. Yes, I put "partner" since I figured that would've been taken more seriously than long-term girlfriend. We were together for more than 6 years. Though I certainly do understand your reasoning.

As Matt suggests, the board is pretty liberal given that they let an unmarried couple buy together and rely on joint finances. As front_porch suggests, have some quiet conversations with board members. How big is the unit? How big is the building? What neighborhood is this in?

"To answer a few of your questions, yes, during the time I've lived here, maintenance has always been paid on time and without problem."

That's not saying much, since you haven't even been there a year.

*****

"I'm not exactly sure that they have a specific ratio - but I'll try to find out. I do think talking to my neighbor sometime soon would be a good idea."

It certainly never hurts to talk, but most boards don't have a hard-and-fast ratio number, instead evaluating the whole picture on a case-by-case basis.

*****

"I hope the money in escrow will work. We'll see."

Time will certainly tell. But be aware that even a couple years of maintenance in escrow for someone who ultimately cannot really afford the apartment may not be enough for many boards. What happens after those two years, and you're at your same income level, with your same outsized income to debt ratio? Boards have a fiduciary responsibility to look at the long term, and unfortunately for you, right now is pretty much a now-or-never opportunity to mitigate any future losses and send you on your way.

*****

I know the board is also pretty strict on single young males - now that I am one, hope that won't play into it either. Eh, at least my neighbor has seen I don't throw raging parties ...ha."

Again, time will tell. The board approved you, assuming you were in a stable long-term relationship. It's not even a year, and after purchasing real estate together, you're breaking up. That is a MAJOR red flag for most board members. In a way, it's even worse than if you were a single male from the start. I'm not judging here, I'm only telling you how it looks to outside parties.

So, if the board disapprove of you taking over the whole ownership, will they evict you right the way? Will they buy back your share? Will they be exposed to more risk and incur more financial burden that way?

Thanks again for your responses. Field - yes, I think I'll talk to my neighbor. It's a one-bedroom, not an overly large building with maybe 15 units on each floor (4 floors). Not a trendy or fashionable neighborhood or anything - just normal working people.

Yes, Matt, I do agree that it would look suspicious. This my lawyer's concern as well. We are going to try everything to make it work. Talking with the board, offering escrow, playing up my savings, etc. I agree with you that it might not be enough. Another thing on my side, is the fact that I've grown up near this building. A few people in the building can attest to the fact that I'd been with my partner for many years.

I also just found out that no new application is needed - just send in bank statements, last two years tax returns. Again, income info will look not good, but bank statements are better.

Interesting, Vic. As for eviction, I believe the apartment would go back on the market and I would stay until the place is sold (again, hoping this won't be the case). That is what I understand, at least. For your other questions, maybe someone with more experience would know the answers...? I'd be curious too.

NewBuyer3 - While it is somewhat bad form for me to ask, I can't help myself: Why did you two split up? I attended a second-marriage-wedding not that long ago where the theme of the toasts was that the groom's way of breaking up with someone was getting married because his first marriage lasted less than a year after the couple had dated for eleven years. The toasts were horrific, one of them wishing everyone well until the next reunion at wedding number 3! (Groom was a comedian and the darkest toasts were made by other comedians, but still . . .). I am wondering if your moving in together was an attempt to make something work that was on the rocks at the time of the purchase? Sorry for prying and obviously understand if you prefer not to answer, but the posts beg the question!

Haha - funny story, Novice. Long story short, once everything came together, it all hit her. She realized she didn't want to be tied down and she wanted a different life. In addition, a rather large and sudden event occurred that caused the loss of my trust. Once trust is lost, for me at least, that's it.

So those were the two, rather large, main reasons. What can you do? Life goes on. As I've made clear, I want to stay - I put so much work into it myself (installation, moving furniture, renovation - with board approval of course). I'd hate to throw it all way (yes, I'd get money in return for the sale, but you know what I mean).

I am sorry for your situation and sincerely hope that you will be able to remain in your home. Explanation makes perfect sense. You seem like a straightforward and decent person, which will hopefully sway Board in your favor if they are concerned about borderline finances. Good luck; seems like a number of us are rooting for you!

im pulling for u newbie !!!!

>NewBuyer3 - While it is somewhat bad form for me to ask, I can't help myself: Why did you two split up?

A better question is how you can squeeze her in this situation. Tell her you don't want to buy her stake. Can she compel a sale? Probably not. So let her be your co-owner and finance your ownership. Tell her she'll get an opportunity for her 50% when you move out and sell.

fields, or whoever you are, YES, YES ,YES. Way to go.

NB3 you are probably young and not so experienced (jaded) in these situations, but take it from someone who's been paying alimony for 25 years with no end in sight. Make her work for it!

You don't have to "love" your business partner.

The suggestion is not to be vindictive to her. I don't know either party. But there's no reason you have to lose to ensure she wins. Frankly if you don't go through the ownership change, there's likely no triggering of any action or review by the co-op. That could actually also offer her some modest benefit - if the co-op says you can't stay and you have to sell, you may both be taking a quick but possibly substantial loss as a distressed seller.

I'm fieldschester.

sorry, of course. Just my history catching up with me. But you make a good point, there is a substantial investment here by both parties and maybe something more long term can be worked out.

Liar's Paradox: "I'm fieldschester."

I'm Heisenberg.

Thanks to you all for the advice and support - I appreciate it. I definitely agree about not loving your "business partner" - the past month has been a big lesson with regard to that.I've discussed the option of her remaining a co-owner with my lawyer - and her as well. She'd continue paying her mortgage and I'd pay the maintenance. However, it's not our best scenario - she would much rather get out and I'd much rather not have her hovering over me longer than needed.

I did, however, just have the place appraised - and it was appraised for much lower than the price we bought it for. She may very well not want to sell her half to me once she sees the appraisal and wait out the market until she can make a better profit.

Life sure gets complicated - hah! One moment you're happy and on your way and the next, everything collapses. But as I said, I'd just rather not deal with her longer than needed.

I'm thinking a little Strangers on a Train.

Uhm board president reply to the other board president.....read your co-op rules, in our case it specifically states transfer between spouses not up for co-op debate.

I'd tell them that you've split up, the apt is being transferred into your name without a mortgage and they can come speak with you if they have any questions. You will need to board president etc to contact the co-ops lawyer to initiate stock certificate change but that's it and can be handled in house unless contentious but even then nothing to do with the co-op and or your finances unless there is something specific in the lease.

I agree with rlr689
"Life happens. And things are in a constant flux. I do not see the need for you to initiate explanation of the change in circumstances." It's your personal life and it won't be suspicious any way because you had long term relations, just tell the truth and it's better to talk to the boards memmber that lives next to you maybe he will help.

Just briefly scammed these comments, but if there's a mortgage on the apartment, you would have to refinance the mortgage in order to get 100% ownership on the stock certificate.

Sorry, skim, my ipad inserted the wrong word.