Congratulations - you have found your agent I t is impor tant to have a seasoned professional real estate agent representing you. Your agent should be k nowledgeable about the neighborhoods you’re considering, guide your search, provide real time data on past and current sales and get you the best possible price for your new home. We look forward to working with you.
If you are financing the purchase, your ver y first step is to be pre -approved for a mor tgage You may think you can a ord a cer tain payment ever y month, but that doesn’t mean the mor tgage company will agree. Based on your income, assets, employment and credit histor y we can determine a reasonable price for your search. We can connect you to multiple excellent mor tgage bankers
If financing, your lender will schedule an appraisal while you work with your lender to provide necessar y documentation. Once your loan application is processed, you will recieve a commitment letter. 0 6
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IS I T P R O PE R T IE S 0 3 PR E PA R E Y O U R B O AR D PA C K A G E
Once you have selec ted the per fect home, we will work together to craft a fair o er based on the value of comparable homes on the market. The o er is a nonbinding agreement that includes a proposed purchase price, nancing terms, proposed closing date, a shor t bio, your nancial statement (and pre -approval letter if nancing or proof of funds if not). The seller will likely return with a “countero er ” and then negotiations begin ... and conclude with agreed upon terms.
Once your o er has been accepted, your attorney will review and analyze the contrac t of sale and due diligence documents. I t ’s crucial to work with an attorney who specializies in New York City co - op and condo sales Your attorney ’s job is vital to protec ting your interests, so please select an attorney who is familiar with NYC transac tions. We are happy to connect you to the right legal exper t for your transac tion. During this process you may want to consider having a home inspection to make sure the proper ty is in good order We are happy to introduce you to ver y good inspectors
For co - ops and condos only - A board pack age consists of nancial documents including tax returns and bank statements, mor tgage commitment letter from your bank , and letters of reference. After reviewing your Board Pack age and deciding to move for ward, the co - op board will set an inter view date We will prepare your board pack age as well as prepare you for your inter view. While condos do not generally require inter views, you will need to present a purchase application that shows you are nancially quali ed to purchase the apar tment
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For co - ops and condos only, a noti caion is sent via email to your agent.
The letter is issued by your lender - Clearance to Close
The buyer’s and seller’s attorneys will nd a mutually acceptable date. For co-ops and condos, from a the closing is generally around two weeks.
Once you’ve signed the contrac t and your deposit is received, your purchase becomes binding on you and the seller. Your deposit will be kept in an escrow account. 1 3
We will go together to the unit to make sure that ever ything is in good work ing order before closing. We will test all lights, outlets, faucets and appliances with the seller ’s agent present. If anything is not in work ing order, the seller will have to repair it or provide a discount at closing This will be negotiated by the agents and attorneys.
Congratulations! You are now a homeowner
Guideline: Appx 2+ years of monthly debt + maintenance costs in liquid assets after closing
1.8% of loan amount <500K
1.925% of loan amount $500K+
Title ins ~0.45% of purchase price
No requirement
No requirement
L ET US H E L P DEM Y S TIFY THE INDU S T R Y J A R GON
Assessment of the property’s market value, typically done for the purpose of obtaining a mortgage
The initial interest rate is fixed for a period of time (typically between three to 10 years). After this initial period of time, the interest rate resets periodically, at yearly or even monthly intervals.
An assembled document provided to co-op and condo boards prior to board approval, which typically includes income tax returns and W2 forms, references, confirmation of employment and statements for all accounts.
A meeting which may be required by a co-op board prior to board approval, following submission of a board package; an opportunity for the board members to meet you in person and ask questions.
A category of townhouses in New York City, primarily found in Brooklyn, Greenwich Village and the Upper West Side; refers to the type of material used as facing on the building ’s front
A tax on the growth in value of your investments (in this case, the home) at the time of sale. The percentage rate depends on your tax bracket; short-term capital gains apply to assets held less than one year
Various fees related to financing that are incurred at the time of closing, including title and insurance fees, attorney fees, current and future property tax and mortgage insurance payments that are held in escrow
Monthly fee paid by condo owners for common building maintenance. Property taxes are NOT included in the common charge
The formal term for condo, whereby homeowners receive separate individual ownership of their specific unit as well as a percentage ownership of the building ’ s communal space
As it relates to real estate, this refers to a building whose purpose has changed from its original construction; potential conversions: 1) from manufacturing or commercial to residential, 2) within residential: from rental to for-sale
10% of the agreed-upon purchase price paid by the buyer at the time of signing the contract
The formal term for co-op, a type of NYC residential building that accounts for approximately 75% of the for-sale market; cooperatives function as corporations, with each owner becoming a “shareholder ” and signing a lease for their individual unit
Owner of a co-op unit , since what you are purchasing are shares of stock in the cooperative corporation.
The percentage of an individual’s monthly gross income relative to the amount of debt owed, ideally less than 25%.
Ownership that is not in your own name, meaning the actual title is associated with a limited liability company, limited partnership, company, corporation or other person.
A lease provision in which the landlord requires the tenant to pay a higher ag gregate rent by adjusting the annual base rent by an agreed method during the term of the lease agreement
Funds or assets temporarily transferred to and held by a third party, usually on behalf of a buyer and seller to facilitate a transaction. A deposit or down payment will be held in escrow in advance of the closing, and lenders also often hold a portion of future tax and insurance payments in escrow during the life of a loan.
The difference between what you owe on your mortgage and what your home is currently worth. The longer you pay your mortgage, the more equity you earn.
A formal record of all your financial assets, debts, income and liabilities.
An installment loan that has a fixed interest rate for the entire term of the loan.
A tax levied by a co-op and paid by the seller when a sale is made, designed to generate funds for the cash reserve
A person who is willing to pay the rent if a tenant can’t , or if an applicant doesn’t meet a landlord’s requirements. Typically, this person is an immediate family member, but people can use anyone, like a friend or a colleague, who is qualified and willing
An agreement between two entities, whereby a commercial tenant pays a landlord (often a city or state government or private institution) to lease land and build upon it; also referred to as a ground lease. The term is generally between 50 and 99 years.
A business structure that can combine the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation; some purchasers prefer to use an LLC for the personal liability protection and favorable tax treatment
A lender ’ s promise to offer a loan or credit of a specified amount to a borrower ; can be either secured or unsecured.
Fees paid by co-op shareholders that contribute to building operations. Maintenance INCLUDES common charges and real estate taxes.
The interest charged on a loan used to purchase a piece of property Mortgage interest compounds and may be either fixed or variable. The majority of a borrower ’ s payment goes toward mortgage interest in the earlier part of the loan.
An alien who has not passed the green card test or the substantial presence test
“Payment in lieu of taxes”; a payment made to compensate a government for some or all of the property tax revenue lost due to tax exempt ownership or use of real property Some properties may be subject to a PILOT tax as part of common charges; this typically functions similarly to land lease taxes
The amount of cash or liquid assets the buyer should have on hand after deducting the downpayment and closing costs, customarily 3-5 years of monthly mortgage+maintenance. Not relevant for a condo
Advanced approval from a bank or other lending institution for a home mortgage
An estimate for credit given by a lender based on information provided by a borrower ; the first step in a mortgage approval process which should be taken prior to formal home shopping to determine the appropriate budget range
A term for apartments in buildings constructed prior to 1947 with a continuous tenant since 1971, where regulation allows for rents far below market value; leases can be passed on to family members in occupancy prior to the death of the primary tenant; accounts for only 1% of NYC’s rentals and the amount continues to dwindle
The entity responsible for developing a new building or converting an existing rental building to a condo or co-op
Newly constructed buildings sometimes receive abatements so that owners do not have to pay taxes on their units for a specified amount of time
A one-time payment paid at closing that protects you from financial loss and related legal expenses in the event there is a defect (ex: back taxes, liens and conflicting wills) in the title to your property
