Most people are familiar with the concept of a co-op board but not a Condo Board Package. The media commonly depicts the former as a snooty hierarchy of residents keeping the undesirables out by enforcing an extreme and discretionary vetting process. If you are buying a condo, however, the process was traditionally far less severe. This may be changing.
Most condos do still require buyers to submit a board package. In the past, this was typically a box-checking exercise where a basic application was signed and a few documents such as mortgage commitments were submitted.
Recently though, potential condo residents in some NYC buildings have complained about increasingly invasive condo sales application packages. It’s always a good idea to check what the application looks like before deciding to buy a condo. If you refuse to fill out the application, the board can delay your closing indefinitely.
Is there a Condo Board Package Fee?
Yes. This is usually between $300 and $1000. In this respect, it works in a similar fashion to a rental. Buildings usually ask for a move-in fee and/or a move-in deposit as well as a move-out fee and/or deposit from the seller.
Expect the pricier condos to charge pricier fees. In NYC, these can be quite exorbitant, so plan ahead.
Check out Marketproof New Development for the most information anywhere on NYC condos.
What information are you required to submit?
Customary applications ask for basic information about the proposed transaction such as the sales price and the down payment. See below for specific elements:
- Signed Purchase Contract
- Loan Application
- Mortgage Commitment Letter
- Tax Returns – Past 2 or 3 Years
- Bank Statements – 2 to 6 Months
- Landlord Reference Letter
- Income Verification Letter
- REBNY Financial Statement
- Personal Reference Letters – 1 to 3
- Professional Reference Letters – 1 to 3
The contact info of the buyer and sellers as well as the brokers and lawyers involved in the deal will also be required. Some applications may also ask about your residence and employment history. It may also ask for details pertaining to the potential occupants of the unit, emergency contacts, and references, including letters.
The signature pages of a condo board application mirror those of a rental application. They can consist of the following signature pages:
- Pet/Wildlife Rider
- Bed Bug Disclosure
- Window Guard Disclosure
- Lead Paint Disclosure
- Occupancy Rider
- Notification of Legal Mailing address
- Emergency contact information form
- Signed Financial Statement
- Credit Check Authorization
- House Rules Acknowledgment
- Condo Power of Attorney
- Fire Safety Acknowledgment Rider
The main difference between a condo and co-op board application
Unlike a co-op, a condo board cannot reject your purchase unless the building itself agrees to buy the apartment for the same or a greater price than your proposed purchase. This is known as a first right of refusal. It’s rare in New York, as condos are so expensive.
When should I prepare my condo board application?
Generally, you will not be asked to submit your condo board package until the bank has issued a commitment letter. If there are not many conditions, this usually takes about three weeks.
If you have a good indication that that your lender will approve you for a loan, it’s probably wise to get an early look at the application and start putting your documents together so the process doesn’t take longer than it has to.
How long does a condo board approval take in NYC?
It usually takes about four weeks after first submitting a package for the condo board to waive their first right of refusal and approve your application.
However, if your package is incomplete, the clock can reset and the board is entitled to take another four weeks to get back to you. It’s unlikely this would happen, but it is worth bearing in mind.
Always submit paperwork by certified mail and asked for a confirmation of receipt of e-mails by the managing agent.
Getting started with Marketproof
With Marketproof New Development, you can easily search both publicly listed properties and unlisted off-market properties not available on popular listing sites. Marketproof can increase the inventory you see by 9-10x what you may see on other sites. Create an account today, and get a 7-day free trial.
Top photo courtesy of Austin Nichols House.