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Is this debt to income ratio normal for UWS coops? - DM May 02, 2022

We did not used to have this but now, it seems, we do.
Basic UWS pre-war coop with no amenities. part-time doorman.

How normal is this?
the building has a debt-to-income ratio requirement of 19%; the combined monthly mortgage and maintenance costs should not exceed 19% of a buyer’s gross monthly income.




> Join the conversation Comments (2)

19% debt-to-income ratio seems rather restrictive, but I doubt it's unprecedented. That board may have had some bad experiences with under-capitalized purchases and the 19% ratio may be a reaction. Have you tried asking the board president or treasurer for a reason? Have you heard any rumors or facts about recent defaults or foreclosures?

I assume the imposition of the 19% ratio is recent. What was it before the change? How did you find out about it, formal notification or word-of-mouth? If yours is a small co-op with few units, financial difficulty in one unit could significantly adversely affect everyone else.

Every co-op is different, and as long as an action taken by the board can be objectively seen as being in the co-op's best interests, the board is protected by the Business Judgment Rule.

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I wrote a long history of what was happening to my Private Coop 2630 Kingsbridge Terrace, Bronx NY. Don't know what happened to it! Basically we were hit with two maintenance increases in two years 13% total. Now we're hit with the bldg needs to raise $1,000,000 in 3 years, and it starts June 1, 2022 To fund some upgrades, and local law 11 requirements, and pay some fines that were discovered. We changed mgmt companies and they found out that the previous mgmt did not pay our vendors. This story is long. The Board has proven to be dysfunctional. They ASSUMED! the bills were being paid by previous mgmt, SO THE SHAREHOLDERS ARE RESPONSIBLE TO PAY! AGAIN1 PLEASE Someone, anyone contact me and tell me what I can do with this mess! I'M DESPERATE! 646 319-7372 OR EMAIL tHANKS!

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> Join the conversation Comments (1)

What you have described about your old managing agent is considered Grand Larceny. With proof in hand I would report this crime to your District Attorney. WHY? It seems your secretary of the board and your executive board members should have known this.
Your new managing agent should have advised the boards lawyer and press charges and hold the old agent responsible for this crime.
Can you inform us of your ex-managing agents name so others boards not hire or have them. Best of Luck

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> Join the conversation Comments (1)

As PC#1 pointed out, you're facing a long list of incompetence and possibly criminal activity. Your board, as the legal representatives of your co-op corporation, needs to contact the co-op's attorney immediately and inform them of what's going on. No individual shareholder nor board member should take any action on their own, except to contact your attorney.

In the event your board can't or won't contact your attorney, you may have to do so independently, but that is a last resort.

How widespread among the shareholders is the knowledge of what's been going on? It is better to work as and with a group on something like this and not individually.

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Solar farm as a revenue enhancer - Robert Apr 28, 2022

Good morning
Does anyone have experience with a roof top solar farm as a revenue source.
Thank you
Robert

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Lost Certificates of Shares - Frank Apr 15, 2022

Hi. My father was a Connecticut resident when he died. He had 2 Coops apartments in Manhattan, NYC. In his last will he left his children (My siblings and I) his shares in the two coops. We don't know where he saved his certificates of shares. We are dealing with the probate process in Connecticut.

What do we need to do to ask the Coops Boards to issue Certificate's duplicates ?

What will the Boards require?

Can the Boards refuse to issue the certificates duplicates or reject us as new shareholders?

> Join the conversation Comments (1)

Sorry to hear about your dad. In order to have a new stock certificate issued, the executor of the estate will typically need to present Letters Testamentary and a death certificate when making the request. Some co-ops may request additional documentation. The fee for reissuance is usually a few hundred dollars.

The certificate will still be in your dad's name. Those who inherit the shares do *not* automatically become shareholders themselves, under most Proprietary Leases. Ordinarily, the only exception is the shareholder's spouse. To become a shareholder, you would need to go through the usual application process. Alternatively, the estate can sell the apartment and the purchaser would need to present a complete and acceptable application.

Even if the board rejects you as a shareholder, the estate will still own the shares and lease, and can sell the apartment to someone else.

Please check with your attorney and your accountant about the tax implications. It is possible that becoming a shareholder yourself will reduce your capital-gains tax burden when you sell to someone else. Only a professional in the field can tell you for sure.

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> Join the conversation Comments (2)

I'm also sorry to hear about your dad's passing.

If your dad was a Connecticut resident but owned property in NY, you may also require a NY probate. Your attorney will advise. If your dad still has a mortgage on either property then the mortgage-holder will probably have the stock certificate(s).

Your attorney should have advised you to get a "date of death" appraisal on both co-ops as soon as possible. The current value of the units will become your new basis for capital gains purposes and will save you a lot on taxes when you do sell the units.

I cannot reiterate enough how important it is for you to follow Carl's suggestions — in particular, letting the attorney who is handling your dad's estate take care of this matter for you as well. My wife was a Trust & Estates attorney in NYC, and she used to say (facetiously) that she billed the most hours from people who tried to save $$$ by taking the DIY approach.

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I asked for a stock certificate duplicate in the name of my deceased father and the Coop Administration is requesting me a Title 9 Eagle Insurance.

Is an insurance neccesary to issue a stock certificate duplicate?

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> Join the conversation Comments (1)

Hi Frank - Search for "Title 9 Eagle Insurance" in your favorite search engine. There are a lot of articles describing what it is, its purpose, and why you are being asked to obtain it.

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broker fee - gary Mar 28, 2022

Hi all,

Is it a common practice in coops for the management company of the coop to charge the coop a 1% brokerage fee of the loan amount for a building's mortgage or re-finance of an existing mortgage.?
Thanks
Gary

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Are you talking about the co-op corporation's underlying building mortgage or an individual shareholder's mortgage? I'm asking because you mention what sounds like taking the 1% fee for brokering an original mortgage for the co-op corp itself. Almost all co-ops have existing mortgages that get refinanced every 10 years.

That being said, if the MA actually brokered the original or refi mortgage then they are entitled to a fee for services.

The best way to find out what is going on is to ask the board treasurer. They should have the most up-to-date information easily available.

--- Steve

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yes thanks for the input, it is the coop underlying mortgage.
Our building just did a refi.

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Hi Gary - Refinancing a co-op's commercial mortgage is almost as complicated as obtaining a new one. It is above and beyond the normal MA services the monthly fee pays for. So IMHO, a 1% commission is not unreasonable.

Congrats on getting the mortgage before the rates go too high

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Questions re language in By-Laws - marym Mar 11, 2022

What does this clause mean: “In the event of an exchange or no-consideration transfer, the flip tax is not triggered?”

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I Am Not A Lawyer, but I believe it means that if the shares are transferred from one owner to another without "consideration" (without money changing hands), the co-op cannot collect any flip tax or transfer fees.

An example of this kind of transfer would be if someone inherits the share of a co-op apartment as a bequest or residuary beneficiary, they would not have to pay the flip tax normally imposed on the purchase transfer of the shares.

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Residency Requirement for Coop Board - Bored Member 1 Mar 04, 2022

Does the meaning of resident in the context of a Coop board eligibility requirement include only shareholders that reside in the coop full time. Are shareholders with a primary residence elsewhere considered residents.

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That's an unusual requirement, in my experience. Check the precise language in your By-Laws. In many cases, there's no restriction on directors at all. In other coops - such as ours - a director must be either a shareholder or the spouse of a shareholder.

If it just says "resident," that seems ambiguous. Obviously a person would be eligible if it's their primary residence, and not eligible if they're subletting and not living there at all. But what about all the situations in between? Someone with a summer home where they spend three months a year? Someone who plans to sublet two months after the election? Someone who says they're a primary resident but the NYC records do not reflect this (a very common problem)? There's no clearly correct answer.

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Mitchell Lama Reform Bill - Gouverneur Gardens Mar 03, 2022

What can be done if the Board of Directors of a Mitchell Lama Coop violates the new Mitchell Lama Reform Law 6412 and inform shareholders of 782 units that until they have a directive from HPD they can swim around the law?

That will continue to use proxies to achieve a quorums not use names of Directors on the minutes when they vote on coop business . Thank you

> Join the conversation Comments (2)

If you don't get any better responses, try using this as a starting point:

https://hcr.ny.gov/ml

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Hi My condo has to do a roof replacement. What is the best way to get it done? Design built or traditional? Anyone dealt with this issue as a board. Open to all suggestions. Thanks!!

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Possible Leaking Roof - NYC Mar 02, 2022

The unit above me has a brown spot on their ceiling. They are new owners and have asked the manager to check the matter. He told them he would but has not made any arrangements for an inspection. I have lived in this building for 25 years and the roof has never been replaced. they have repeatedly asked for someone to check this out but are being ignored. What would the next step be?

> Join the conversation Comments (1)

Here are a few suggestions. Others will probably add to the list.

* You said you asked the manager to check. I assume you mean the Managing Agent? What about board members? Have they been approached about this?

* Do you know if other shareholders are aware of the situation and how they feel about it? If your building is not too large you might try organizing the shareholders to take some action as a group.

* Do you know how long the brown spot has been visible? If it didn't just appear but has been there for months you should call 311 and ask them how to report a possible mold situation.

These are things you can do which have a low impact. Ultimately it's your board who are responsible for the condition and wellbeing of the building. If they're receptive to your notifications they should take over.

If they're hostile to you, tight with the managing agent, haven't raised maintenance in years, they're probably not going to start now. You should run for the board, or better, put together a slate of candidates to replace the entire board. Sometimes the mere threat of opposition or replacement can have a wonderfully motivating effect.

Regardless of what you do, it's going to cost money. Be prepared for an assessment to cover the cost of roof replacement.

Good luck!

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> Join the conversation Comments (1)

Thanks for pointing the direction. :-)

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> Join the conversation Comments (1)

You're welcome

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Hold Harmless agreement - herb zyd Mar 02, 2022

Anyone aware of the pros and cons of a coop board requiring shareholders to agree to a hold harmless agreement for simple contractor work - like carpet cleaning? Thanks.

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The practical uses, requirements, and drawbacks of hold harmless agreements are complex. As a first step, search for "hold harmless" in google, you'll find a ton of articles, After you've have a basic understanding and knowledge of hold harmless agreements, get in touch with you co-op corporation's insurance carrier and speak to your account rep. They should be able to answer your questions and more.

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Mortgage Originators' Requests for Insurance Coverage Increases - Steven424 Feb 23, 2022

Lately, some of my shareholders who are looking to refinance and at least one new purchaser have approached the board with requests to increase insurance coverage limits. What I don't understand is, the increased coverage amounts are minuscule. For example, one ReFi requested an increase in Fidelity Bond (theft and embezzlement) from $435K to $450K. Another was for a D&O increase for some similar small amount.

Has anyone on here been hit with these kinds of requests? If so, how did you handle them with your shareholders, and also with the offending.... errrr... requesting banks? If you said or did something that worked and caused the bank to forego their increase request, please post it on here so the rest of us can benefit.

Thanks!
--- Steve

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