Cooperative apartments (“coops”) differ from condominiums (“condos”) in several ways. When you buy a coop, you buy stock in the corporation that owns the apartment building. The building then “leases” the coop to the buyer under a long-term proprietary lease. Coop owners pay monthly maintenance to the building corporation for items such as the expenses of maintaining and operating the building property, property taxes and the underlying mortgage on the building (if any).
When you buy a condo, you buy an individual parcel of real property, like a house or townhouse. The condo building is divided into individual condos and a common area. A condo owner owns its apartment and an undivided interest in the common area and is responsible to pay its own real estate taxes and its share of the common charges for the expenses to maintain and operate the common areas. Unlike a coop building, there is no underlying mortgage on a condo building.
Generally, a condo has a higher value than a comparably sized coop; however, a condo buyer has additional closing costs for title insurance and mortgage recording taxes. Depending on the coop building, the tax deductibility percentage of the monthly maintenance charges may differ.
You should consider consulting with a New York condo attorney or coop lawyer once you find an apartment you want to buy. He or she will guide you through the home buying process by preparing or reviewing the contract of sale, advising you about financing and title insurance, answering your legal and tax questions, and arranging for the documents necessary to complete the purchase.
Manhattan home ownership—whether a condo, coop, or townhouse—can provide you with many benefits, including, a long-term investment and tax advantages. Of course, a home is also a major financial commitment. There are ways to avoid costly pitfalls that can strain your budget and your patience.
At the time of the closing, you will have to pay the price for the home and closing costs. Thereafter, you will need to budget for insurance premiums, maintenance, monthly loan payments, property taxes, utility bills, and repairs. Prior to entering into a contract of sale, it is recommended in some cases that a buyer conducts an inspection of the home, which includes, checking the age and condition of appliances, plumbing, roof, structures and wiring, and other physical elements of the home.
A New York real estate lawyer guides you through the home buying process by preparing or reviewing the contract of sale, advising you about financing and title insurance, answering your legal and tax questions, and arranging for the documents necessary to complete the purchase.
You should not sign a contract of sale unless it protects your rights. Your New York condo lawyer reviews and amends the contract of sale accordingly. Any conditions that must be met before you complete a home purchase should be stated in your contract of sale. For example, many buyers make their home purchase contingent upon obtaining financing.
The “closing” of a contract of sale completes the purchase and takes place at a meeting in the offices of the New York coop attorney representing the seller or lender, if any, or at a location designated by the coop corporation. At the closing, the buyer, seller, and lender sign a deed and mortgage (for a condo or townhouse) or the stock and proprietary lease documents and the security agreement (for a coop), pay the purchase price and exchange documents. At the closing, the buyer may receive a title insurance policy, along with a statement of closing charges and the keys to the home. Your NY real estate lawyer attends the closing to assure that the documents and computation of closing costs are accurate.
