The main difference between a co-op and a condominium is the structure of legal ownership. When buying a co-op, you do not own a specific unit in the building but instead you own stock in the corporation that actually owns the buildings and all the apartments. You lease (the proprietary lease) your apartment or unit from the corporation. The unit’s size, location and the like, determine the number of shares of stock allocated to the apartment. There are monthly fees (maintenance fees) based on the number of shares of stock you own to cover the building’s mortgage payment, taxes, and general operating expenses. As a shareholder, you have a say in electing the Board of Directors who manage the building. To facilitate the sale or purchase of a co-op, a knowledgeable attorney is invaluable. Below is a list of services and activities that are usually involved in the process of buying/selling a co-op.
If you are a seller, attorney representation may include:
‧ Telephone consultation with client, as appropriate
‧ Preparation of the sales contract
‧ Negotiation with buyer’s attorney
‧ Serving as escrow agent with respect to the Down Payment
‧ Title report review
‧ Coordination of pay-off and existing mortgage
‧ Attendance at Closing
‧ Preparation of Closing Statement
If you are a buyer, attorney representation may include:
‧ Telephone consultation with client, as appropriate
‧ Review of the sales contract and Prospectus
‧ Review of coop’s board minutes
‧ Negotiation with seller’s attorney
‧ Title report review
‧ Assist with mortgage commitment
‧ Coordination with buyer’s residential lease termination
‧ Attendance at Closing
‧ Preparation of Closing Statement
If you have any questions, do not hesitate to contact Jeffrey A. Margolis at The Margolis Law Firm.