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HDFC coop

Started by 911turbo
22 days ago
Posts: 158
Member since: Oct 2011
Discussion about
This maybe a silly question, but are there asset requirements for purchasing a HDFC coop in NYC? I understand there are income requirements, so you are not eligible if you make over a certain amount of income, but if one were retired and had $3-5 million in assets, and was essentially living off dividends and interest and/or had modest rental income that was still below the maximum income threshold, could one actually purchase a HDFC coop?
Response by UptownSpecialist
22 days ago
Posts: 136
Member since: May 2013

In most HDFC's there aren't any formal asset requirements. There are some relatively newly formed HDFC's that do have maximum asset requirements stated clearly (i.e. 3593 Broadway)- but these are few and far between. That said- at least some of these HDFC boards are going to look at your assets may say amongst themselves if this buyer has such significant assets- then they can afford to buy a market rate apartment- resulting in a rejection.

After working with a lot of HDFC's - I won't work this market anymore. There are far too many HDFC co-op boards that are just unreasonable.

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Response by front_porch
20 days ago
Posts: 5249
Member since: Mar 2008

911, the HDFC co-ops will generally require that you "not have another residence" or "you not have another residence within X miles" depending on which building you're dealing with. They might well also impute a rate of return to your portfolio -- If you have $4mm in assets and had $80K in income from that, they might argue that you could reasonably and prudently be making $160K in income from that.

UptownSpecialist, I'm shocked because I think of that as such a specialty of yours -- will follow up offline.

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Response by 30yrs_RE_20_in_REO
19 days ago
Posts: 9768
Member since: Mar 2009

Not based on any real statistical analysis, but it seems in some HDFC Coops it's routine to go through several Board rejections before getting to a closing

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Response by UptownSpecialist
18 days ago
Posts: 136
Member since: May 2013

Sounds about right from my experience as well. I have encountered more than a few HDFC's that reject about 75%-80% of buyers. This is a component that weighed in my decision to stop working with HDFC clients. I have encountered far too many problems and headaches to make it worthwhile- and it's not the buyer's or sellers..it's the boards that are typically the issue. When you factor these unreasonable issues that I don't typically encounter in market rate buildings, and the lower price point, not to mention additional variables associated with these buildings - i.e. high flip taxes, can improvements be factored into lowering the flip tax, income restriction amounts (particularly when the building uses the maintenance in calculating the restriction amount- and it's often a fictious number), etc...I was doing a lot more work, as well as spending a lot more of my time plus a lot more drama for a lot less money. I wanted to help these clients - but it was burning me out and after one particularly outrageous board requirement I just had enough- though I did manage to get the deal closed.

Within my firm, I am happy to provide some initial guidance for agents that pick up HDFC business- but it's not something I can work with beyond a teaching capacity.

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Response by 30yrs_RE_20_in_REO
18 days ago
Posts: 9768
Member since: Mar 2009

I have always recommended against buying HDFC Coops to my clients.

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Response by Krolik
15 days ago
Posts: 1213
Member since: Oct 2020

@30 why?

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