Purchasing a New York City Co-Op

When looking for a new home, you may want to consider a housing co-operative. Unlike a condominium, when you purchase a co-op, you are purchasing a share of the building or property itself. The housing cooperative is categorized as a corporation or limited liability company (LLC). As such, everyone within the complex owns an equal share of the property. No one person owns an individual unit, although each person lives in their own unit. Those who live within a unit in a housing co-operative are subject to an occupancy agreement which functions almost like a leasing agreement. Under the agreement, members have a right to a specific unit within the property. The agreement contains the specifics regarding the rules and regulations of the co-op as well as the rights a shareholder is entitled to. A New York cooperative apartment lawyer can assist you in matters concerning the purchase and ownership of a co-op.

Do you or someone you know wish to purchase a New York City Co-Op? A lawyer can be of assistance. Contact a New York Cooperative Apartment Lawyer today!

There are a variety of different laws in New York that govern the conversion of rental apartments to co-ops as well as other issues relating to cooperative apartments. The acts and laws that regulate co-ops include:

• The Martin Act: The Martin Act (Article 23-A of the General Business Law) applies to the sale of all types of cooperatively owned real estate. The sale of co-op shares, condo units, or interests in homeowners' associations is subject to the Martin Act, as is the sale of other securities, such as stocks and bonds. The law requires that a complete description of these kinds of real estate interests be fully disclosed in an offering plan. No advertising or sales may take place unless the offering plan or prospectus, containing all the detailed information necessary for a purchaser to make a reasoned judgment about the decision to buy or not to buy, has been accepted for filing by the Attorney General. Cooperative corporations carry a building mortgage which allows each co-op owner to obtain less financing
• The Cooperative and Condominium Conversion Act: also part of the General Business Law, specifically regulates the conversion of existing rental buildings to cooperative forms of ownership. One section (352-eeee) governs the conversion of residential apartment buildings in New York City. A second (352-eee) applies to those cities, towns and villages in the counties of Nassau, Rockland and Westchester that have passed resolutions adopting the coverage of the law. A third (352-e(2a)) protects senior citizens and disabled tenants in the municipalities throughout the state that have adopted the law. The board of a cooperative building is legally permitted to discriminate in the selection of new tenant owners
• The Condominium Act: details requirements for condominiums throughout the state (Article 9B of the Real Property Law)

The majority of Manhattan area buildings are cooperatives. Before someone can close on one of them, most cooperatives require board approval, partly to ensure that their investment is protected. A package of specified information regarding a potential shareholder and resident must be reviewed by the board before admission. If a unit will be financed, the board will also require a letter of commitment from the lender. Once the information is reviewed by the board, the shareholder and prospective resident must meet with them for an interview. If everything checks out in favor of the potential buyer, the board will contact the seller and set a closing date with the buyer and their representatives. As such, it is important to have an experienced New York cooperative apartment lawyer to help you with your purchase of a New York City co-op.

Many jurisdictions have created specific laws to address the unique issues that face co-op owners. Since co-op's offer ownership in the form of shares of the entire property rather than ownership of a specific unit, certain guidelines must be created and enforced in order to ensure that every owner is treated fairly and retains their equal share of the property. As such, statutes that address cooperatives are similar to those that address large businesses and corporations. They regulate everything from the operation of a cooperative to how the rights and rules of the shareholders are assembled. In general, each shareholder is given an amount of votes that corresponds with the number of shares they own. For more information regarding the specifics of New York City co-ops, seek the advice of a lawyer who is experienced with housing cooperatives in your area.

Do you or someone you know wish to purchase a New York City Co-Op? A lawyer can be of assistance. Contact a New York Cooperative Apartment Lawyer today!