Down Payment requirement

for some coops you also need to show a X amount money in your account after the transaction, to prove you can handle mt. and mortgage payments.-each coop is different basically, talk to the seller broker.

Every board has their own rules. Most will count ALL loans (from all sources) towards the maximum financing.

You will also need to prove liquidity after the down payment (usually at least 2 years of mortg and maint payments). If the 25% down is a problem, then a coop may not be for you.

When you buy into a co-op you are actually buying shares of a corporation (the building) so that is why the co-op boards are so careful about scrutinizing your finances & lifestyle & also why they are such a good investment; the investors have been vetted. Imagine going in to business with someone who had sloppy habits, was irresponsible & was always late with their payments. You could lose the business so, again, that's why the boards are so careful about your financial history. Now all the social stuff in the top top buildings, that's another story.

If it is a non mortgage loan from parents you could take the gamble and try to get in, I don't think they can find out where the money came from. But most want 1 some even 2 years of cash in the bank to cover mortgage&maintenance.
If your income is sort of low though they may wonder how you saved the 25% and question that.
Some Condops allow 10% and most condos do too. That might be better for you even though the pricetag is higher.

I think it's fine to borrow from parents for a down payment.

why are coops only for old ladies?

why can't kids save money themselves and stop relying on their parents??

Let's do some basic math. Figure a decent UES/UWS 1Br Co-Op sells for $550,000 and the maintenance is $1,000/month. 25% down is $137,500. At 6.5% 30 Yr Fixed the mortgage is $2,607/Month plus Maintenance is $3,607/month. 24 Months of payments is $86,568. So a person would need to have LIQUID assets of over $224,000 before even being considered for a entry level 600-700 sq ft apartment. That's great if you have the money but how apartment poor do you really want to be and do you really think it's worth it?

This is why I don't fully understand when people say condos are more expensive- full stop. I find in many ways while the purchase price is typically 25% more than a co-op, then less stringent requirements on liquid assets can make them more affordable than a coop.

Do all buildings require 24 months liquid in addition to the down payment?

How does this impact the original question - whether you can borrow for the down payment.

to comment #11 - you don't seem to understand the distinction between being less expensive and being less affordable. One has to do with cost, the other with cash flow. Condos may require less cash flow, but that doesn't make them less expensive. It just makes them more affordable for people who are liquidity-constrained.

I am #11 - i understand the distinction - i didn't write/describe it correctly. Yes it is a matter of liquidity. At any rate - i purchased a condo and then used my liquid assets to make renovations. I liked not having it tied into a larger downpayment.

...also remember closing costs. which are higher for condos.

As for loans from parents, many coop boards allow 'gifts'. the way it works, parents give their kids $$ and sign a noterized statement confirming that the amount is indeed a gift and not a loan. This is standard and most RE agents have a form you can fill out. The trick is to have the parents deposit the $$ in their child's bank account as soon as possible so it will sit there for a while and therefore look like a 'gift' and not a 'loan'. Then, after the close you can do whatever you want.

why can’t kids save money themselves and stop relying on their parents??-
agreed 100%. I think it shows a sad state of out country and future when younger people need their parents to help them buy their residences while they don't think anything of spending $300 a week on booze.

#18 it's not uncommon for parents - anywhere in the country - to help their kids with a downpayment, a loan or otherwise. You can still teach kids value - this time of buying property and building equity.

I bought a place with help from my folks with every intention of paying them back...knowing full well that I will have to forgo my monthly supply of minalo's. And it sure beats throwing my money away on rent. And my folks, who are retired and have the funds, were more than happy to do it.

Do coop boards count 401ks in the post-down payment liquid asset formula? And if yes, is it discounted for early withdrawal penalty and income taxes (discount about 50% total)?

Unfortunately, 401ks, IRAs and the like tend NOT be counted as liquid assets by coop boards.

#19, don't even worry about paying them back dude, cause its really like a down payment on their inheritance that you'll receive anyway. If they really wanted to teach you "value" they woulda had your ass out working and saving from the get go~thats why there are 21 year old adults and 36 year old kids, and its the kids who are fucking this city up btw, because everywhere i look there is a new bank branch opening,( i.e. the death of the 2nd Avenue Deli) so you can get that cash transfer from your old folks shopping at Wal-Mart while you buy shoes at Barneys

#22 you're not making any sense.

city is being ruined by trustafarians and self entitled schumucks that decide to move here from fly over country