Gea Elika's Blog, page 126

All you Need to Know about Reference Letters when Buying an NYC Co-op

If you’re looking to buy a co-op apartment in NYC, you may be aware that the typical co-op board package requires several personal and professional reference letters. The co-op board package is something of a rite of passage for anyone wanting to buy into the exclusive cooperative buildings. You not only have to qualify financially. You must also convince the co-op board that you’ll be a valuable asset as a neighbor.

This is where the reference letters come in. With a competent buyer’s agent and a few basic guidelines, it’s not difficult putting together a board package.

 

 

How many reference letters does a co-op board application require?

The first thing to keep in mind is that every co-op board is different. Some will require more reference letters but typically between three and six are required per application. Some board applications have very strict guidelines while others are more flexible. If you’re unsure, ask your buyer’s agent to clarify the requirements with the listing agent.

Each reference letter, whether it’s a personal or private one, should be fully original with its own letterhead and signed at the end.

How long does it take to collect your reference letters?

How soon you can request and assemble your reference letters depends on whether or not you are financing your purchase. If you are making an all-cash purchase it takes less time as you can send in your application straight away. However, if purchasing with a mortgage you will need more time. Until you receive your mortgage commitment letter you won’t be able to submit your board application. For most banks, this typically takes 3 to 5 weeks.

In any case, you should apply for your reference letters as soon as you can. For most people, this means having a fully executed contract and a copy of the co-ops financial requirements.

While you are collecting your references your buyer’s agent will help you through the process. Once everything is in place they will submit the full package to the board from both the buyer and seller.

What should you include in a personal co-op reference letter?

When choosing people to fill out your reference letters, cs people who know you well. They should know enough about you to fill out a full page of information with lots of anecdotes. It also helps if they are co-op owners themselves. A common mistake many people make is in making the letter about themselves rather than the applicant.

Instead, it should be full of anecdotes about how they met the candidate, how long they’ve known them and the nature of their relationship. The whole point of a personal reference letter is to show that the applicant is responsible, trustworthy and ethical.

 

PERSONAL REFERENCE LETTER SAMPLE

March 17th, 2018

Dear; Members of the Board,

I am pleased and honored to provide a personal reference for my good friend Mike Adams, currently of 123 Park Ave, New York, NY, 1111

I have known Mike for seven years. Like most people, I was instantly charmed by his good nature and friendly demeanor, and we soon became close friends. Having shared many a social occasion I have found Mike to be a sincere and dependable friend.

Without reservation, I would endorse Mike to your board. He is a kind, respectful, hard-working professional and a great friend. I know that you will find Mike a good neighbor, and most likely a good friend.

Please feel free to contact me at any time if you would like more information about Mike Adams.

Sincerely,

Stephanie Smith

Manager, Finance Administration

Williams & Co

123 Park Avenue

New York, NY, 11111

555-555-5555

 

What should you include in a professional co-op reference letter?

Like the personal letter, the professional letter should also state how and why they know the applicant professionally. While also giving insight into their character traits it should mention as well how they excel at work. For instance, are they team players, leaders and do they bring a positive attitude to the workplace?

 

PROFESSIONAL REFERENCE LETTER SAMPLE

March 17th, 2018

Dear; Members of the Board,

My name is John Smith, and I am a research analyst for Smith Williams & Co. I have had the pleasure of knowing Mike Adams professionally for over three years. I would be happy to have Mike Adams as a member of my community.

I regularly seek out Mike’s advice on a variety of subjects, he is well read, and all of his opinions are well considered. Mike is a valued member of our research team and on many occasions provides reasoned insight to help solve the most complex task.

I highly recommend Mike Smith as a friend and a good neighbor. Please feel free to contact me should you have any questions at 555-555-5555

John Smith

Research Analyst

123 Park Avenue

New York, NY, 11111

555-555-5555

 

What should you include in a landlord reference letter

A landlord reference letter is made out to show that you have paid your rent obligations on time with your previous landlord. It should include your former address, the length of your stay and the amount of your rent. It’s also good to add the landlord’s assessment of you as a tenant.

 

LANDLORD REFERENCE LETTER SAMPLE

March 17th, 2018

RE: 55 West 12 Street, Apt 12B New York, NY, 1111.

To whom it may concern:

Please accept this letter as confirmation Michelle Smith residency at 55 West 12 Street, Apt 12B New York, NY, 1111. Ms. Smith has been a resident of ours since 10/1/2016 and currently pays a rent of $3,950.

Michelle Smith is an exemplary resident, consistently maintain his rent payments on time and we highly recommend Ms. Smith to any community for residency.

If there is any further information required, please feel free to give me a call.

As agent for

John Adams– 55 West 12 Street, Apt 12B New York, NY, 1111

Please feel free to contact me at landlord@gmail.com or 555-555-5555 should you have any questions. Thank you

Sam Price

Property Manager

Price Management

What if you don’t know enough people to ask for reference letters?

To ensure the application has the best chance of success you should submit a comprehensive board package. Providing less than the required number of references will only result in it being sent back before it has even been reviewed.

If you’re worried that you don’t have enough people to ask for references, ask your buyer’s agent to verify what’s needed. There may be a chance that reference letters from family members may be permitted.

The post All you Need to Know about Reference Letters when Buying an NYC Co-op appeared first on | ELIKA Real Estate.

10 Things to Know about Buying Investment Properties in NYC

While owning your own home has many benefits, there is a way to invest in real estate that can also produce a steady flow of income. However, this oversimplifies the subject. This article discusses the basics of real estate investing.

1. Hire an Attorney

You will need to protect your personal assets in the event of bankruptcy or litigation. Many form a limited liability company (LLC) or limited partnership. There are ways to do it online, or you can consult an attorney. This is one area where it may pay to consult an expert since the cost of not doing it right could be catastrophic to your personal finances.

 

 

2. What type of property?

There are a myriad of investment properties. Will you purchase residential properties? If so, will it be a single condo or co-op unit, or the building? If it is a co-op, the board may have restrictions on subletting. Multi-units or multi-family homes may have more upkeep, but you will still have a cash flow if some of the units remain empty.

A wide range of commercial properties are available, should you choose to go that route. While the tenant typically is responsible to take care of more things, the complexities also rise.

3. Where should I invest?

We won’t repeat the maxim about the three most important rules for real estate, but clearly location matters for your investment.

New York City has very favorable investment characteristics. It is a cultural and commerce powerhouse. Unlike the 1970s, the city has a reputation as a safe city. This blog gives a better explanation of the attractive characteristics of New York’s real estate climate.

But, you must still decide on a neighborhood. In general, economic factors such as income growth, proximity to transportation, and neighborhood characteristics such as the types of shops and restaurants are considerations. A well-informed agent can assist with this task. For a risk-averse real estate asset, we recommend thinking micro markets within New York City.

4. Time Frame

As with most investments, your time horizon is an important consideration. You can buy a fixer-upper, in the hopes of making a fairly quick profit. This can be high risk as hidden problems could get discovered or the real estate market changes direction. However, the potential rewards could also be high. Conversely, your time horizon might be measured in decades, and you will be content collecting stable rents, although potential appreciation could be substantial given the long time frame.

5.  Tenants

This is a broad category to consider, but an important one. If there are existing tenants in place, that provides immediate income. But, contemplate whether the rent is market-rate. In addition, it is important to remember you have not personally done the background check and vetted the tenet.

6. Outside management or go alone?

There are management companies that will lessen your burden. Typical tasks include collecting rent and dealing with troublesome tenants. However, this comes at a price. Most charge a fee that is a percentage of the rent.

7.  Taxes matter

There are special considerations. This is a complex area, with many rules, such as deducting non-cash items like depreciation.

Investors should also be mindful of tax abatements. These buildings have had property taxes lowered for a certain period of time in order to help revitalize an area through development. The cash savings will increase your take-home income, and your property could experience price appreciation, providing things go according to the city’s plan.

8, Inspection

This goes beyond examining for structural issues like the condition of the roof. Since it will be rented, the apartment must be clean. Beyond that, it might have to be spruced up so it includes items such as up-to-date appliances. This could require additional cash outlays, and may cause a loss of rental income until the unit is ready.

9. Financials

If you are investing in a condo or co-op unit, financial stability will be important. There should be sufficient funds put aside for wear and tear items such as a new roof. Otherwise, maintenance fees could increase, which you might have to bear until you can raise the rent sufficiently.

In a multi-unit building, examining the financials is also important to see how the returns are derived. For instance, if there is a large unit that generates a disproportionate share of the rent, this is an important factor.

10. Return on Investment

Needless to say, it is important to measure profitability. However, in isolation, it means very little. Rental income, less monthly expenses such as maintenance, repairs, and financing costs, gives net income. However, it should be compared to the amount invested. The percentage should be compared to other investments. For instance, if you have a 2% return, and the 10 year Treasury bond is yielding 2.8%, you would be much better off in the latter. This is especially true since the risk of losing your principal is extraordinarily small (most consider it a risk-free investment).

There are a couple of other considerations. Although the purchase price is typically determined based on square feet, renters typically look at the number of bedrooms. Therefore, if extra bedrooms can be created, a smaller unit may command a higher rent while costing less to purchase.  In addition, it is important to analyze sales and rental data. The two do not always move in lock-step, and there have been instances where sales prices have risen faster than rents.

In real estate, leverage, or borrowed funds, is often used. This potentially increases returns since you can purchase a property with a down payment and pay the balance over time. Of course, it also increases risk and magnifies losses in a downturn.

Conclusion

This gives an outline for investors to consider. Real estate investing can be profitable through rental income as well as price appreciation. But, as always, it is wise to investigate and consult an exclusive buyers agent before a large investment is made.

The post 10 Things to Know about Buying Investment Properties in NYC appeared first on | ELIKA Real Estate.

Co-Op Boards Debt to Income Ratio Requirement

A co-op board reigns supreme in the home buying process. Their collective judgment is final, and you may find yourself starting over should they reject your application. The long process includes finding an apartment, compiling an offer and the subsequent back-and-forth negotiating, putting together your co-op board application for the board and going through a  board interview.

The board can reject your application for virtually any reason. It cannot violate your civil right, and it is unlawful for your entry to be denied based on your race, creed, color, age, sexual orientation, marital status, origin, handicap, or if you have children. But, anything else is pretty much up for grabs, and they don’t have to give you a reason for their denial decision, either.

In light of this, it is useful to understand a key ratio, debt-income, which boards examine to determine your financial suitability.

 

What is the Debt to Income ratio?

The debt-to-income ratio is the sum of all your monthly debt payments divided by your monthly income. Your debt payments include entire mortgage payment, or principal, interest, taxes, and insurance. Maintenance payments are typically included, but other expenses, such as utilities, are excluded. Lenders will also add other debt payments, such as car loans, student loans, and credit cards.

Generally, lenders will break down the ratio into two parts. One uses just mortgage payments in the numerator, and the other is based on your entire monthly debt payments.

Why is it important?

This is an important measure that helps the lender determine your ability to repay your debts. The higher the ratio, the less wiggle room you have to make your debt payments. This means it is more likely you are to run into financial trouble and potentially default on your loan.

Lenders conduct due diligence to ensure they are repaid. Co-op boards despise defaults, too. It creates vacancies, hurting the building’s reputation and financial position.

What is debt ratio is acceptable?

New York City Co-ops are known for having strict financial standards. In many cases, their debt-to-income ratio is lower than the lender requires. Typically, banks want a maximum 28% of your monthly income going towards your mortgage and 36% of your total debt payments. However, lenders have shown a willingness to allow a much higher ratio.

Many co-op boards want to only see a maximum 25%-30% of your income going towards your mortgage payment. This is in-line with the more conservative approach. Therefore, receiving your lender’s stamp of approval does not mean it is clear sailing.

The ratio relies on gross monthly income, not after-tax. This goes beyond your salary and includes rental income and interest/dividends. Self-employed buyers have more work to do, given they are allowed a certain deduction for tax purposes. This may require you to explain your circumstances.

Other considerations

The Board examines a host of other factors, such as tax returns and salary/bonus history. There might be mitigating factors where the board will pass you through, even if your debt-to-income ratio is slightly below their target. For instance, if you will have more liquidity than they are looking for after closing, or can make a compelling case that your income is temporarily depressed, you may still pass muster.

The post Co-Op Boards Debt to Income Ratio Requirement appeared first on | ELIKA Real Estate.

Favorite Foodie Finds in NYC

Manhattan may be known for its legendary restaurants, late night finds and corner bodegas but occasionally it’s nice to have a night in too. Despite notoriously small kitchens, intrepid home cooks have scoured various parts of the city to find the best markets with the best ingredients to be able to whip up something at home.

From classic New York delicacies like lox and bagels to specialty meats and cheeses, various artisans and stores cater to demanding foodies, no matter where you live. For foodies, even having to schlep groceries from one side of town to the other via bus, subway or taxi is no trouble when they get to enjoy the fruits of their labors. Take a look at some of the most revered places that food lovers shop in New York City:

Chelsea

 

 

Chelsea has no shortage of high-end restaurants and places to grab a quick bite or a nice glass of wine. But it is also home to the Chelsea Market, a collection of specialty shops perfect for finding goodies for your next meal. Check out some favorites, including buonitalia, which sells Italian specialties like meats, cheese and gelato, Lucy’s Whey, a specialty cheese shop and Dickson’s Farmstand Meats, which features a variety of cuts and sausages not found in your typical grocery store.

Midtown

When in Midtown, be sure to check in at Grand Central Market. Yes, there’s the Oyster Bar for a quick snack, but there’s also an indoor farmer’s market type area selling everything from caviar to fresh veggies and flowers.

Also in Midtown, you can get your knives sharpened at JB Prince while you shop for gourmet gadgets and tools that you can’t always find in your typical restaurant supply.

Lower East Side

 

 

The Lower East Side’s food scene is famous thanks to films like Crossing Delancey. While the legendary Gus’s Pickles have moved to Brooklyn, there are still a few other pickle purveyors in the area, including Pickle Guys and some pickle sellers are also available at the local farmer’s market.

Also here is Russ & Daughters, best known for their lox and bagels but they also sell other dishes, from smoked fishes to caviar and they even ship so you can send friends and family a taste of The Big Apple.

Then of course, there’s the Essex Street Market, a collection of specialty food purveyors that includes butchers, cheese shops, Asian specialties, artisanal French bakeries and more.

Greenwich Village

Alongside trendy bars and bakeries, there’s also The Broadway Panhandler, for filling up your kitchen with everything you need to cook up something delicious. And a local long time personal favorite Bar Pitti.

Upper West Side

On the Upper West Side, head to Zabar’s famous for its local specialty items perfect for taking home or going for a picnic in Central Park. The two-story store has food and to-go items downstairs, while upstairs is stocked with kitchenware, gadgets, baking supplies and more to create your own meals at home.

Farmer’s Markets

 

 

The Union Square Greenmarket is the city’s largest farmer’s market and is open year round. It’s a favorite because of the diverse range of produce, meats, dairy and other fine products offered. If you’re not near the original, offshoots have popped up from the Upper West Side to Tribeca.

If you’re looking for a complete list of all the terrific food and specialty stores in the city, visit this link.

The post Favorite Foodie Finds in NYC appeared first on | ELIKA Real Estate.

Questions to Ask Before Hiring a Buyers Agent in NYC

For most people, buying a home is amongst the most significant purchases they will make in their lifetime. Home buying can be an intimidating experience, with a lot of facts and figures and general knowledge to cover. To help you get through the hard stuff, it is recommended that you hire an exclusive buyers agent, especially if you are a first-time homebuyer or relocating to a new city. Finding a buyer agent that best suits your needs can be difficult. Before you hire a buyer’s agent, first ask:

1. How long have they been a full-time buyer’s agent for residential real estate?

While the number of years in real estate isn’t necessarily an indicator of success, working full time in the industry indicates that they have a lot of time on the job, where most useful skills are learned.

2. How familiar are they with the neighborhoods you are interested in? How many homes have they sold there?

Spending time buying homes in the neighborhoods you prefer indicates that the buyer’s agent has a solid understanding of the area, especially if they have already helped buy homes there in the past.

 

 

3. What type of buyer agency do you practice?

There are three different buyer agency types, so if you are looking for a specific realtor, then you will want to ask this question. The types include: Non-exclusive buyer agents (represent buyers and work with brokerages and sellers of their choice, but there can be a conflict of interest if they work with an office that also has selling agents), Designated buyer agents (represent the buyer), Exclusive buyer agent (represents buyers only and doesn’t take seller listings).

4. Can the buyer’s agent recommend service providers for you to help with all aspects of home buying?

A buyer’s agent should be able to recommend mortgage providers, inspection services, and other services that are necessary for buying a home. A good buyer’s agent will be able to give you more than one company and let you know if they have a relationship or receive compensation for their recommendations.

5. Is the buyer’s agent aware of any special programs that can help you buy the home or make improvements after the purchase?

A buyer’s agent familiar with the area you are considering should be familiar with local laws and regulations and be able to point you in the direction of local, regional, state and federal programs that help with home purchases and improvements. Good buyer’s agents may also be aware of alternative programs and even grants and loans as well.

6. Does the buyer’s agent know of any incentives being offered?

Not all markets have hit rock bottom, and homebuilders and sellers may be offering incentives to help sell their property.

7. Does the buyer’s agent have appropriate credentials and certifications?

These include those from the Accredited Buyer Representative (ABR) certification from the National Association of Realtors® and The Certified Buyer Representative (CBR) designation.

8. Are there any fees associated with the buyer’s agent and how do they get paid?

You may want to shop around for the best buyer’s agent fee. The commission for the buyer’s agent is paid by the seller, but as real estate commissions are negotiated differently, be sure you know up front who will be paying the buyer’s agent.

9. How will the buyer’s agent reach you about new homes available, your bids and any questions?

Find out the best way to reach your buyer’s agent and how they communicate so that you can make sure that you are both on the same page at all times, whether text or email is your preference.

10. Ask for a list of previous clients.

As with any service provider, ask for referrals to find out if previous were clients were pleased with all of the above. Websites like Yelp, Google and others can also provide an excellent reference to learn what other home buyers experienced when working with the agent or agency you are considering.

These questions are a good way to start a conversation about home buying. Depending on your needs and preferences, you may also want to choose a buyer’s agent specializing in first-time home buyers, condos, co-ops or townhouse properties.

The post Questions to Ask Before Hiring a Buyers Agent in NYC appeared first on | ELIKA Real Estate.

NYC and L.A. Remain Attractive to Chinese Investors

Juwai.com, a website that provides global property information in Chinese in order for the nation’s citizens to mine international properties. It recently put out data that showed the United State remains an attractive investment destination.

We look at the data closer to see what this means.

 

Image courtesy of juwai.com

 

Diving deeper

The United States the most viewed country and most inquired about foreign destination by Chinese investors, continuing a trend, according to Juwai. The sustained interest comes as the relationship between China and United States has chilled somewhat due to trade concerns and the North Korea saga.

A National Association of Realtors (NAR) survey showed China’s residential property buying has surged. For instance, from April 2015 to March 2016, the Chinese spent $27.3 billion on United States’ real estate, which grew 16% to $31.7 billion the following year. It was the most amongst foreign buyers

A Hurun report, Immigration and the Chinese HNWI 2017 Report, released July 2017, showed the United States rated the most popular emigration destination among high new worth Chinese individuals. This is the third year in a row that the U.S. has been at the top of the list. Los Angles was the most popular North American city, with New York in fourth place.

Looking at the city level data from Juwai, this reveals even more interesting and relevant conclusions for our readership. Based on locality, Los Angeles was the most viewed destination and New York City was in second place, with Seattle in the third spot. These cities occupied the same three spots in 2016.

Is this sustainable?

California and New York have attracted Chinese buyers for several reasons. These include the strong culture, creating familiarity and acceptance. U.S. real estate also serves to diversify their investments beyond China’s border.

Last year, China’s government put in new measures, which are partly designed to restrict currency outflows. The regulation, which went into effect in July 2017, forcing the country’s financial institutions to report cash transactions of more than 50,000 yuan, down from 200,000, and any overseas transfers conducted by individuals in the amount of $10,000 or more. Thus far, the latest regulations do not seem to have stemmed real estate buying, particularly in Los Angeles or New York. Nonetheless, it bears watching to see if this crimps buying.

Political events, particularly given the latest vitriol emanating mostly from the United States, are also a potential headwind. The latest was the implementation of steel and aluminum tariffs, with countries threatening retaliation. China has promised a “necessary response.” No one knows how this will play out, but there is the prospect that the United States will become a less-friendly place for foreigners to invest.

The currency could also play a factor. A weakening yuan makes U.S. property more expensive but also builds in price appreciation for existing property holders.

Final thoughts

The Juwai shows Chinese real estate investors continue to have a strong interest in U.S. real estate. Both Los Angeles and New York City remain prime targets. This means continued strong demand and increased competition for properties.

The post NYC and L.A. Remain Attractive to Chinese Investors appeared first on | ELIKA Real Estate.

NYC Real Estate Offers: When do they become binding?

Real estate contracts tend to differ from state to state. When buying a property in NYC, it’s important to understand how they differ and the basic steps involved. This is especially so if you’ve bought an apartment or home somewhere else before. One of the most common questions brokers receive from clients is when exactly do NYC real estate offers become binding?

As you’ll see, the process involves a bit of back and forth before anything becomes legit, with the seller holding most of the cards.

 

 

When does an offer in NYC become binding?

Unlike many other states, when an offer is made to purchase a home in NYC, nothing legally prevents either side from walking away without reason until both parties have signed the purchase contract. Verbal agreements are not valid nor even written ones unless they are signed by both buyer and seller.

It doesn’t matter what kind of paper the agreement is written on. It could be written on a napkin. Though a napkin would not be very efficient for writing the meticulous details of an agreement. However, to be legally enforceable it must be signed and sealed by both parties.

Another important difference is that upon signing, the buyer must make a down payment, usually 10% of the purchase price. This should not be confused with the downpayment a buyer must also make to their mortgage lender at closing. Which is typically another 10% of the purchase price.

Offers and counteroffers

When someone makes an offer on a New York home it is typically done by filling out a one-page offer form or letter provided by the listing broker. A buyer is not required to sign the document when making the offer or make what’s called an “earnest money deposit” (A deposit typically made to show good fate and their solid intentions to close the deal).

The seller can then either decline, accept the offer or make a counteroffer. However, if the buyer does not accept the counteroffer the contract is still not legally binding. Both parties must reach a full agreement regarding all the terms and sign before the contact becomes legit. Because the seller has the ability to sign last, they have enormous negotiating power. They can use this to test other buyers and choose the best offer. All while holding the current buyer completely captive.

Once an offer is accepted it is vital that the buyer and their attorney move as fast as possible to finalize and sign the contract of sale. The completed contract will lay out all the terms of the deal, such as price, contingencies and closing date.

Delivering the downpayment upon signing

Once the buyer’s attorney has performed due diligence and the buyer signs the purchase contract they will be expected to produce a check for 10% of the purchase price, made out to the sellers’ attorney or firm. This down payment will be deducted from the purchase price and the balance due at closing. Buyers should ensure they have sufficient funds to cover this downpayment. Many contracts allow sellers to cancel the contract if the downpayment check is dishonored.

The check, along with your signature pages, will then be delivered to the sellers’ attorney. Once they have signed and sent copies back to the buyers’ attorney they will officially be “in contract.” Neither side can now walk away without being in breach of the contract and subject to litigation.

The deal is now binding and in the escrow period however not yet complete. If the buyers’ mortgage financing goes through and no outstanding liens are found against the property, the title will be transferred and money exchanged.

The post NYC Real Estate Offers: When do they become binding? appeared first on | ELIKA Real Estate.

Guide to Mortgage Financing for US Residents & Foreigners

Have you decided to finance your real estate purchase, but do not know where to start? Our article outlines all the steps and resources you will need. Start with the section on the benefits of pre-approval for a mortgage below or learn about bad credit mortgages and you will get all the information necessary to help you better understand your financing options.

 

 

Mortgage questions and guide

 

Mortgage Financing Requirements

Prior to beginning your search for a New York City home or investment property it is essential in being aware of the financing requirements for non-cash buyers. Whether choosing to work with a mortgage bank or broker the information below will prepare you in advance. Be prepared with the following documentation:

US Residents & Resident Aliens

Personal data – Full name, address, and Social Security number.

Income – The amount and source(s) of income for all borrowers.

Most recent checking and savings bank statements
Two years of tax returns
Employment letter verifying your start date, annual salary including bonus
If self-employed – letter from your CPA or attorney verifying your salary and net worth

Assets – Information on all assets such as checking and savings accounts, stocks and bonds, retirement plans, and other real estate owned.

List of other liquid or non-liquid assets
Most recent asset portfolio statements (if applicable)
Most recent 401K or retirement fund statements (if applicable)

Debts and obligations – Information on all outstanding debts and any other financial obligations.

Credit references – Information concerning loans or debts that have been paid, plus any other references to good credit use.

Reserves – 6 months of the mortgage payment for loans

Mortgage Loan Programs

30 Years Fixed
3/1, 5/1, 7/1, 10/1 ARM
20% – 35% down payment required


Foreign Nationals

Financing for: Tourists, Visitors, Residents of other Countries, No U.S address, No job in U.S.

Documents Required

Valid (unexpired) Foreign Passport
I-94 (Required only when the Foreign National is in the U.S. at time of application or closing)
International Credit Report

Income and Asset Documentation Requirements

Proof of Income – Tax returns, pay stubs, etc.
Stated Income available
Verification of Deposit

Down payment and closing costs must be verified by U.S. institution
Reserves can be verified in a foreign institution with 6 months history
Statement accounts required

Reserves

6 Months of a mortgage payment for loans
12 Months of mortgage payments for loans >$650k

Mortgage Loan Programs

30 Years Fixed
3/1, 5/1, 7/1, 10/1 ARM
30% – 70% down payment required

 

Note: Information above is a general overview for foreigners seeking to obtain financing for the purchase. Requirements for financing can vary from bank to bank depending on individual buyer qualifications.

 

What are the benefits of mortgage pre-qualification?

Except for when you intend to pay for your purchase in cash, it is essential that you are pre-qualified with a New York City mortgage company. Not many of the major mortgage lenders that exist nationally are available in New York because co-operatives tend to be popular in the city, but as long as there’s a need to be served, you’ll always find a mortgage lender for pre-qualification purposes.

Reasons why it is important to be pre-qualified

A pre-qualified buyer is usually a better option for sellers as they understand that you are serious and prepared to make a purchase. In addition to this, when you are pre-qualified, you also receive preferential access.
Pre-qualification provides a better understanding of the actual price range you can afford, and this helps you focus better regarding what you may want to buy. A lot of buyers can usually afford more than they believe they can.
Buying NYC apartments is a big step, so when you are competing against other buyers and you are armed with a pre-qualification from a recognized mortgage lender, your offer will be treated with preference.
If you are pre-qualified and your offer is accepted, the fact that you are pre-qualified will speed up the rest of the purchasing process; if you are not pre-qualified, your offer will need to undergo much more scrutiny before finally sealing the deal.

Applying for a Mortgage

A mortgage quote will help you get an understanding of the terms of your mortgage, the amount and the interest rate. You can get a quote on any form of variable rate mortgages. The quote can be for any term of six months to thirty years. The decision is yours. However, most lenders try to direct you towards a mortgage that benefits them, so you need to decide in advance which mortgage option works best for you.

 

So how do you determine which type of mortgage is right for you?

Consider the following to help you select the right mortgage:

You should think about a short-term mortgage when interest rates are dropping. If your credit rating and financial situation allow, try to get a mortgage that has one year or less on the term. Check out financial websites to see if interest rates are expected to go down, stay the same or increase and in what period the change is expected to occur. You want to choose to lock in your interest rate or not, for how long and whether you will be better offer with an adjustable or variable rate mortgage.
You should think about a long-term mortgage. Although you shouldn’t lock in your interest rate if it takes you more than five years to pay back the loan. Any more than five years and you will likely pay more on interest rates than when you get a shorter-term mortgage or a variable interest mortgage. You may also miss the chance to lower your interest rate. Again, it is essential to consider your credit rating and financial situation first.
If you can save money, then you should try to get the best pre-payment and payment frequencies available. To get these, you should sacrifice as much interest as possible, or if you are expecting a ‘windfall’ sometime soon. However, be sure not to sacrifice more than you can spare.

When it comes to getting the best mortgage rate quotes your best tool is the internet. Several websites give free mortgage quotes from one or more of the top mortgage lenders. This reduces the hassle and footwork that you have to do.

 

How to find the Best Mortgage Rate?

The interest rate is the most critical part of a mortgage to consider. Your interest rate is negotiated for a particular period of six months to thirty years. During this time, you will have to pay the agreed interest rate.

If you can get a low-interest rate, you will pay less in interest costs for the term of the mortgage. When you first negotiate your mortgage for a New York City apartment, you will be able to save thousands of dollars by lowering your interest rate.

Your mortgage will be at its highest amount when you first buy your property. Your payments at this time will primarily be interest charges while a smaller amount is applied to your ‘principal’ or the actual amount you borrowed. This means you are paying less on the large sum of money due to a lower interest rate and in the end, you will be able to save more money.

So how can you lower your interest rate? Look around and consider various mortgage options. Make sure you negotiate with your lender as the lender relies on your business for success, and they cannot make money without you. The lender may make you think that they are doing you a favor by approving your mortgage, but you are doing them a favor as long as you pay off your debt on time.

Lastly, when it comes to interest rates you need to remember that many mortgage lenders will stack the deck to favor themselves. The interest rate they want to charge will make them money. Lending is by no means a charity business. If you get an interest rate lock for five years, then you will end up paying more for your mortgage. This is because the lender wants to make sure they make money off you even when interest rates go up. Therefore, if you try to reduce your interest rates by locking in your payments at a low rate now, you may end up paying more because you are increasing the lender’s risk.

If you are willing to accept some risk, especially if you have an excellent job with proper credit, then you can benefit by getting a variable rate mortgage. This means your interest rate will change along with the market, which is somewhat risky but it also means that you will be able to save money:

A variable interest rate mortgage will be lower than a locked in interest rate mortgage

If it seems like interest rates are going to go up, then you can often switch to a locked in a rate with no additional penalties.

Ultimately, if you can switch without penalties, then you will often be able to get better deals with a variable interest rate mortgage.

 

I have no credit history, and I’m told I can only get a mortgage loan with high-interest rates

Consider whether you need to buy right away. If you can wait to buy then don’t rush into your purchase. Instead, take the time to get a department store credit card. The other option is to consider a small, short-term loan from a bank or credit union of about six months to a year. Make sure you make regular payments on time; this will enable you to establish good credit in just a few years. While building up your credit history, you can also work on saving money for a down payment, ultimately giving you a better chance when re-entering the property market.

You can expect to pay a higher interest premium if you need to buy right away. This is because your lender doesn’t know how you will handle the loan. Nevertheless, don’t get discouraged, no matter what your credit still try and get the best deal possible. It can be a good idea to try a mortgage broker who you can show your stability like a good job and regular pay to, and there is the possibility of advancement due to their contacts. Be aware that your interest rate may still be higher than those with good credit history.

 

What are Bad Credit Mortgages?

Even if you have financial problems or bad credit, you can still obtain a mortgage, a bad credit mortgage.

You are considered to have “bad credit” if you haven’t been able to build up your credit history yet, and you will have a low credit score if you don’t yet own a credit card or have a loan. If this is the case, a bad credit mortgage may be a good idea.

What exactly is a mortgage for bad credit? These mortgages give you a chance to establish your credit history if you cannot wait. It can also be a refinancing option for those who already own a home.

No matter how you got into your current financial situation, you need to find a lender who will work with those who have bad credit. These lenders often realize that bad credit happens and you likely have a good reason for it. Before talking with a lender, it can be a good idea to see what your credit score is by going online.

When you get a bad credit mortgage, you will enjoy the following benefits:

Clean up your credit history or establish proper credit
Gain relief from a mortgage with a high interest
Consolidate previous bills into one convenient payment each month
Pay off existing creditors to get debt relief
Get the extra money needed to pay for home repairs or emergencies
Help you to avoid bankruptcy

 

How do I know I’m getting the best deal?

Doing your homework is the only way to know you are getting the best mortgage deal. Have you checked free quotes online? Have you talked to other lenders? Have you spoken with a mortgage broker? After reviewing just a few sites, you will acquire a wealth of information about your proposed mortgage deal.

 

I’m buying my first home, and I need help.

When buying a New York City apartment, you will have the free services of a real estate agent since the seller is paying for the agent’s commission. Take the time to interview several real estate agents. Each agent will be able to give you some useful information on the real estate market.

You should also talk with your financial institution or bank; they can provide valuable information from these sources. While talking with them, you can even get mortgage pre-approval. This way you can determine what budget you are working with and whether or not you are ready for the big step of buying a home; including whether or not you are in a realistic financial situation to buy a house.

So what if you found the perfect property and you’re in a hurry to make a purchase? Take a moment to read our section on buying a home. Here you will find valuable information and tips.

If you can take your time when buying a home and inform yourself as much as possible so that you know exactly what you are getting into. Buying a home is probably the biggest purchase you will ever make, so it pays to take the time to look for the best deal.

 

What if I’ve heard bad things about my lender?

It is a good idea that you don’t sign your mortgage papers yet.

Rather take the time to review the consumer feedback from other mortgage lenders. You should also make sure your mortgage lender has the financial stability necessary to offer you a loan by checking with financial rating companies. Sometimes bad customer service can come from financial pressures within an organization.

If you’ve already signed your loan papers and are making payments to the lender, then you still have choices. First, you need to make sure you continue to make on-time payments. Make sure you keep thorough payment records whether you have a reputable lender or not. This way you will have the data you need to back you up in the event of a dispute.

If you are concerned about your lender’s procedures, then you need to get legal advice. For help, you can try a consumer watchdog group. Often when a company is put on the spot or placed in the media, then many lending companies will choose to do the right thing.

 

What is a non-conforming mortgage?

Nonconforming means a mortgage that doesn’t follow the standard underwriting practices of other mortgages. This is often because an individual has either bad credit or no credit history.

If someone mentions this to you, then don’t be concerned. This means you may have to pay greater interest, but you will still be able to get a mortgage.

However, if you are offered a non-conforming mortgage loan, it is important to get several quotes first whether they are from an online source or several mortgage brokers. Be sure to consider all your available options. Remember lenders are competing for your business, and this allows you to get the best possible deal.

 

What are my payment options and what are the differences?

There are various payment options, and they typically allow you to make extra payments or choose to increase the number of your payments. This helps as when you make an additional payment or increase your amount; you will be able to pay off the total amount of your loan sooner.

The difference in payments can be significant. You will have a better chance of making payments if your lender makes your payment plans flexible and achievable.

To understand this let us consider an example. Often banks give you just one day on the anniversary date of your mortgage to make a lump sum payment. Therefore, even if you have extra money you may not be able to make your additional payment. As a result, you spend the money, and they don’t have it when you need to make your lump sum payment. By making lump sum payments at any time, you can significantly reduce how much you pay on your mortgage loan.

Then some lenders allow individuals to increase their payments. Some lenders will only let you make double payments. So what happens if you can afford to pay extra money, but not enough to make a double payment? While just a little bit may not seem like a lot, it can quickly reduce the principal of your mortgage by hundreds of dollars in a year. Over thirty years this will save you thousands of dollars in interest. You may also be able to pay off your mortgage years earlier.

When it comes to a mortgage loan, you need to get the best payment options while not giving up the chance to get the best interest rates.

 

Why should I check the stability of my lender through a rating company?

Should your lender become insolvent, there is the chance that your loan will be due and payable immediately to pay off the creditors of your lender? While you could get a mortgage with another lender to get rid of this problem, you will face a lot of financial strain and stress.

Also, if a lender starts to have financial issues, then they may not keep good records. If good records aren’t kept, then it may appear as if you owe more money than you do and as a result, you may end up paying for the same debt twice.

These problems are a lot less likely to occur if you choose a financially stable lender.

Even if your lender appears financially stable, it is a good idea to keep close records on your mortgage payments. Even the best lenders can lose the occasional record, and you don’t want to be billed for more money than you owe.

 

Is it better to go with my bank even if they have a higher percent?

No, it’s not, while you may prefer your bank you can pay considerably more during the life of your mortgage with as much as one percent difference.

However, it pays to check a few numbers before going somewhere else for a mortgage. If moving your mortgage loan to a new bank cause fees that exceed your savings from a lower interest rate then you may want to stick with your bank. It is also important to consider the payment options available, does one lender offer better payment options? Make sure your payment options are comparable.

You also need to consider the ‘hassle’ factor to an extent. If you go to a new bank, you may have to set up new pre-authorized payment plans or additional paperwork issues.

Therefore, if the options and numbers for a mortgage are in your favor, then you should stay with your same bank. Be sure to tell your bank if you can get better rates somewhere else, tell them why you would prefer to stick with them, and then ask if they can offer a lower rate. You should also make sure you have quotes available from other lenders; if you are a good customer, most banks will want to keep you.

If the bank doesn’t want to keep you then, you will need to be prepared to take the next step.

 

What is PMI Mortgage Insurance?

The market today is full of products related to mortgage insurance. Some of these work to help you save money to purchase a home, others serve to make your mortgage payments in the event of ill health, death or loss of work due to disability.

Often a lender offers mortgage life insurance. This type of mortgage insurance ensures that your mortgage will be completely paid off in the event of your death or the loss of your spouse if you are both named on the actual mortgage.

The best deals on this type of insurance are directly from the insurance companies. Lenders commonly offer package deals that cost you more and don’t offer many benefits. While your bank may try to get you to purchase mortgage life insurance, it is usually more cost effective to buy it from someone else.

Buying mortgage life insurance through your lender can be up to three times the expense of a term life insurance policy in the same amount, yet the effects are the same, In the event of a death, you will be able to pay off your mortgage. If you are going to buy an additional insurance policy to pay off your mortgage in the event of a death, then you want to compare the cost of getting two policies versus a single package policy through your lender.

However, if you have a history of bad credit, your lender may require you to have insurance. If this is the case, then you will need to get additional insurance. This, however, is a different type of insurance. Typically, this type of policy will be for private mortgage insurance. If you don’t have the complete 20% down payment for a New York City apartment, there is another type of insurance you may be required to get. While this insurance policy means you can buy a home, it is an additional cost that will not benefit you.

 

Can I take a larger Mortgage than I need?

Have you qualified for more than you need when it comes to a mortgage? Is your New York City apartment going to need renovation or repair or do you have other financial debts that aren’t getting any smaller?

If any of the above situations apply to you, then you may be able to benefit by taking out a larger mortgage than you need.

If you have a fair amount of money for a down payment, then you may want to take more out of the mortgage and put less money down. This means you will have more cash on hand for use, as you need it. However, why take more out of your mortgage and increase what you owe? Often a mortgage loan is cheaper than all other types of a loan. A mortgage interest rate is 5 to 10% less than other loans depending on who you get your loan through and how high your credit rating is. As of 2009, many mortgages are 5% or less if you are buying from a reputable bank and have good credit. Most consumer loans come with an interest rate of 10% or higher, the interest rate on credit cards is often between 15 to 18% and can be as high as 29% if you don’t have a good payment history. This means you can save a lot of money and get further ahead if you replace your credit card debt with a mortgage payment.

So what if you want to fix up your new home? If you bought a property that needs repairs, then there are two advantages to taking out more mortgage than you need. First, you will be able to add value to your home through renovations. Second, you will be able to get the money needed for repairs at a lower cost. You will also benefit having saved money on the repairs, enabling you to get more value and enjoyment from your new home.

Be aware that you aren’t reducing your down payment about the home purchase price when increasing the amount of your mortgage. Sometimes lenders will require that your mortgage and down payment equal the market value of a home and won’t give you money more than the home value; in this case, you could apply for a home equity loan.

If you are taking out more mortgage money, ensure that that decision is your own. Don’t let your lender or real estate agent push you into making this decision. This can be a hallmark practice of predatory lending, and if you aren’t careful, you can end up with a higher mortgage payment than you can handle. Make sure you consider your specific financial situation before choosing to increase the amount of your mortgage. This option is only right for you if it places you in a financial position that is manageable and benefits you in the end.

 

How can I save money on my Mortgage?

The best option is to get the lowest interest rate available; this allows you to save money over the long term.

However, you should be careful because if you have a shorter amortization, then you will likely have higher payments. While you will be saving money in the end with this option due to lower interest rates, you will also need to make sure you can afford the short-term payments.

One way to lower your risk and still save money is by getting a 25 to 30-year amortization on your mortgage while increasing your payments. Most lenders allow you to do this without charging any penalties. Even if you can only improve your payments by a small amount, you will be able to pay off your mortgage years earlier while also enabling you to reduce your payments back to the original low amount if you need the extra money.

Provided you have the right mortgage; you can quickly increase your payment by as little as five percent. Even though this is a small change in your payment amount, it can make quite a difference in the long term. That extra five percent works to pay off the balance or principal of your loan faster.

If a new baby comes along for example or you have a medical emergency, and you need that five percent; merely reduce your payments back down to the original amount, and you can have the five percent for those other expenses.

Keep in mind that many lenders will have some restrictions on how much you can increase your mortgage payment and the number of times you will be allowed to adjust it.

Another way to reduce the time that you will be paying off your mortgage is making payments in lump sums. If you cannot afford higher fees, then this is a good option. Take your annual bonus from work or your tax return and put it towards your mortgage. Again, this will help reduce the principal of your mortgage and will lower your interest rate in the end. Even if you can only make small payments, every year you will be able to reduce the total time it takes to pay off your mortgage.

Want help?

With over a decade assisting buyers only Elika has established strong relationships with leading lenders such as Wells Fargo, CitiBank, Chase, Bank of America and more. If you would like us to connect you with a qualified mortgage professional, contact us.

The post Guide to Mortgage Financing for US Residents & Foreigners appeared first on | ELIKA Real Estate.

What is the difference between Condo and Co-op in NYC?

Understanding the difference between a Condo vs. Co-op is an essential step before beginning your home search. Home Buyers or investors looking to purchase in New York City face a choice that those interested in other real estate markets don’t have to consider: Condos or Co-ops?

Each choice offers its pros and cons, but many new to the city’s real estate market often ask themselves, “Why on earth do co-ops even still exist?” Those that already own property in the city – whether it be condo or co-op – however, don’t have such a flippant attitude. The coop ownership structure in the New York City effectively added another layer of regulation to the city’s housing industry, thus saving it from the subprime crisis to an extent experienced by no other city in the US.

 

 

In all, somewhere between 70% and 80% of all housing in the New York City is co-op housing. While that share is falling steadily, it is a relatively slow trend, and the market will continue to be dominated by coops for some time to come.

That being said, the co-op ownership structure did not exactly rise from the best of traditions: It was a mechanism for large apartment buildings to screen out unwanted applicants of various types, usually of class or social lines – or even racial lines, though never explicitly.

Co-op boards continue to be somewhat snooty, especially the wealthier ones. The process of applying to live in such a place is often more rigorous than trying to get into an Ivy League college.

Fortunately – and perhaps ironically – this snootiness curbs demands for coops, and so their prices are, on average, 10 – 30 percent less than the typical condo regarding price per square feet.

Another barrier to entry that keeps the average price of coops lower than condos is that they often require more money to be put down up front. Sometimes there are even clauses saying this money cannot be money from a bank loan but has to be the buyer’s pre-existing cash reserves.

One good thing about co-ops, though, is that the money you pay your share of the building’s taxes and mortgages is deductible from your income taxes.

Also, once you are actually in one, the arduous admissions process that you went through will have to be completed by all other potential neighbors, thus saving you from the possibility of living next to Kid Rock or some other similarly lovely character.

Also, some of the oldest, most prestigious buildings in Manhattan are coops. Of course, the same can be said about condos, but the point is that many coops have a certain old-money flare to them that condos often eschew.

Other than those benefits, though, there’s little to say in the way of coops. Condos are especially better as investments. They are easier to buy and sell thus are a considerably more a liquid asset.

 

Comparing New York City Condo vs Co-op


NYC Condos
Estimated time to close a Condo purchase 1-2 months

Below you will find a brief Condo overview, if you would like to learn more please visit our comprehensive guide at:

New York City Condos

 

Condo Closing Costs Learn More

In a co-op, owners only own their unit and common grounds until they decide to move, at which point ownership transfers back to the corporation. They cannot transfer title or ownership at any point and in reality never truly own anything.

Condominiums are a different story. When buyers purchase a condo, they receive a deed and yearly taxes and other ownership fees. They can sublet their condo or sell it outright if they so choose.

Advantages of Condos

Higher visibility and availability for buyers locally and international
Flexible financing options; most condo buyers can finance up to 90% of the condo’s selling price
Easier application process with higher acceptance ratios
Lower common and maintenance charges usually
Condos have flexible sublet policies


Disadvantages of Condos

Closing Costs are generally higher for Condos
Flexible financing and purchasing process can attract less qualified buyers and investors that could be forced to sell at a lower price during distress
Co-ops owners cannot sell for whatever price they want to whomever they want
Most Co-ops charge sellers a flip tax of 1% – 10%
Flexible sublet policies can attract more renters that could cause greater wear and tear on the building

A disadvantage of purchasing a condo is the higher overall cost since there aren’t nearly as many condos as there are co-ops. This is changing quickly as new condo developments pop up all over the New York area.

Condo Overview

As more and more new buildings are constructed in New York, condominiums are fast gaining in number and popularity. It’s not surprising considering the ease of buying a condo rather than a co-op. As opposed to a co-op, a condominium apartment is “real” property. A buyer receives a deed just as though he or she were buying a house on an individual plot of land. Each apartment in a condominium receives its tax bill. There is still a common monthly charge similar to the maintenance charges in a co-operative.

These charges don’t include your real estate taxes and are not tax-deductible. They also tend to be lower than in co-ops because there is no underlying mortgage for a condominium building. The straightforward nature of buying a condo coupled with the fact, that in some cases, you can finance up to 90% of the purchase price and sublet them at will, makes condominiums the number one choice for flexibility. Young buyers, investors, and buyers that choose to use creative financing are urged to consider condominiums.

NYC Co-ops
Estimated time to close a Co-op purchase 3-4 months

Below you will find a brief Co-op overview, if you would like to learn more please visit our comprehensive guide at:

New York City Co-ops

 

Co-op Closing Costs Learn More

With nearly 80% of the ownership opportunities coming from the co-operatives, this method of ownership is the most popular.

Co-ops are owned by an apartment corporation. When you purchase within a co-op building, you’re purchasing shares of the corporation that entitle you, as a shareholder, to a “proprietary lease.” Co-op “shares,” include both the residence and a portion of the common areas of the building, including the laundry or fitness area, lobby, etc.

Advantages of Co-ops

Lower cost to purchase, Co-ops 10%-30% less expensive than like-kind Condos
Owners receive “shares” in the entire building–and therefore own–the building’s common features
Due to strict subletting policies, the majority of a co-op is end user thus take better care of the common areas
Owners may be eligible for a number of tax deductions


Disadvantages of Co-ops

When financing is allowed the minimum downpayment is 20% or higher
Difficult application process with the risk of board rejection
Co-ops impose strict subletting policies
Co-ops owners cannot sell for whatever price they want to whomever they want
Most Co-ops charge sellers a flip tax of 1% – 10%

 

The corporation first pays the real estate taxes, mortgage of the building, salaries, and maintenance; that cost is then split among the owners of the residences, each owner paying an amount that is in relation to the “share” that he or she has in the building.

In a co-op, the building’s Board of Directors decides whether to accept applicants as owners or not. A potential buyer fills out an application and interviews with a representative of the building. Rules and ownership details vary by building, so ask for additional information before agreeing to buy. Also, ask what the corporation’s tax structure is, as owners are sometimes eligible for tax deductions.

One of the disadvantages of living in a co-op is the final down payment expected. Although financing is an option for some, most will be expected to pay quite a bit more than the traditional ten percent down. 50% is not uncommon, and some co-ops don’t finance at all, expecting full payment up front.

Co-op overview

A phenomenon that’s limited almost entirely to New York City, cooperative apartments have been the traditional form of owning an upscale apartment for close to a hundred years. In fact, in New York City, 70%-80% of all apartments available for purchase – and almost 100% of the grand pre-war apartments on Fifth, Park and Central Park West – are in co-operative buildings.

The larger your apartment, the more shares of the corporation you own. Co-op shareholders contribute a monthly maintenance fee to cover the building expenses.

The fee covers such items as heat, hot water, insurance, staff salaries, real estate taxes and the mortgage indebtedness of the building. Portions of the monthly maintenance fees are tax deductible due to the building’s underlying mortgage interest. Also, shareholders can deduct their share of the building’s real estate taxes.

A co-op Board of Directors can determine how much of the purchase price may be financed and minimum cash requirements. Co-op apartments require a more substantial down payment than most condominium apartments, especially in top buildings, whose ownership requirements may be stringent.

Subleasing a co-op can be difficult. Each co-op has its own rules and they should be carefully reviewed prior to application to purchase.

The post What is the difference between Condo and Co-op in NYC? appeared first on | ELIKA Real Estate.

Co-op Board Interview in NYC: Questions & Tips to Pass Your Interview

Living in a co-op comes with its share of advantages ––like you might have a greater chance of knowing at least some of your neighbors, and perhaps even liking a few of them. But getting into a New York City co-op is not an easy feat. Most people who live in co-op apartments have to grin and bear the selection process, which tends to be invasive and often grueling, depending on the board and the building’s address.

Prepare to be grilled by a group of fellow shareholders on everything from finances to how many children you have, or even the breed of your dog. Doing your homework is half the battle, however –– there’s no better way to prepare for a co-op interview than to have a list of questions ahead of time, so you can mentally answer each one before the Q and A.

 

 

These are some of the most frequently asked questions you’ll most likely be asked during a co-op board interview.
Financials

1. Usually, financial questions come before the interview, but, just in case, take a copy of your financial statement with you to prepare for questions.

2. Especially if you’re self-employed, expect to give detailed explanations of your finances.

3. Are you confident that you can afford maintenance and the mortgage comfortably?

Feel-Good Questions

4. What made you choose this building?

5. What made you choose this apartment?

6. Why do you want to live in this neighborhood?

7. How many apartments did you view?

House Rules

8. Do you have questions about the building?

9. Do you have pets?

10. What renovations do you plan to do and how will you afford them?

11. Will you use the apartment for residential purposes only?

12. Do you work from home?

13. Would you run for the board?

Lifestyle Questions

14. Do you play any musical instruments?

15. Do you entertain often?

16. Do you smoke?

Answer questions to the best of your ability and when needed make sure they align with what you have included in your board application. Be honest. Make eye contact, and try and remain as neutral as you can, especially when responding to those more personal questions. Mostly, don’t let the interview get to you –– keep your cool no matter what they ask. Occasionally, boards will push the parameters and table topics that are not allowed legally. Answer these but without giving too much information, if that’s possible. No matter how invasive, do not refuse to answer any question.

If your interviewer asks if you have any questions for the board, the best response is something like, “Not that I can think if right now, but thank you.”

What to wear

Dress well and wear something understated. (Don’t pull out your halter-top in the heat of summer or sweats like you just finished a workout.) Mostly, know that if you made it to the interview, you probably have a very good chance of getting the apartment and passing with flying colors. And if your nerves start to get the best of you, remember that each board member was probably in your shoes once, too.

12 Tips to help ensure your Co-op board interview goes well:

While coops are more plentiful than condos and less expensive, their approval process is far more rigorous. The purpose of the interview can vary widely–some boards view it merely as a formality after approving an application, but others use it as an opportunity to scrutinize candidates and their financials. Here are 12 tips to help ensure your board interview goes well:

1. Dress conservatively. Men should wear a suit and tie, and women should wear a professional dress or suit with minimal jewelry.

2. Be on time. Keeping a board waiting will not serve you well, so try to show up early. Also, understand this is a time-consuming process, so be patient with the board.

3. Expect personal questions. Be prepared to field personal questions without getting defensive. Remember that the board is simply trying to determine what kind of neighbor you’ll make.

4. Familiarize yourself with your finances. Going into the interview, you should know your financial statement like the back of your hand and be prepared to answer questions about it.

5. Solidarity is important. If the board is interviewing you with your husband, wife, or partner, make sure you’re all on the same page, so you don’t interrupt or contradict one another.

6. Don’t ask questions. For the most part, the board should have answered your questions before your signing a contract. Now is their time to ask you questions. .

7. Don’t mention renovations. Unless asked, don’t talk about the work you intend to do, and, even if asked, downplay your plans.

8. Don’t over-share. Limit the personal information you divulge to what the board asks. Don’t volunteer things.

9. Don’t expect an immediate decision. The board usually will conduct a full review, which takes time.

10. Meet post-interview requests. In some cases, approval might be contingent on your holding maintenance in an escrow account.

11. Wait for an answer. Once the board has decided, the managing agent will contact you or your agent. Typically, if approved, notification is given within one week.

12. Don’t worry. Being confident and at ease during the process will help you.

The post Co-op Board Interview in NYC: Questions & Tips to Pass Your Interview appeared first on | ELIKA Real Estate.