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BUYER CHECKLIST Here below is a summary of the main guidline of the purchasing process :
We have detailed this purchasing process in 14 steps : 1. Decide the time that is right for you to purchase. The New York City real estate market has been so robust for so long, owning property in Manhattan has proven to be a solid investment. For many purchasers, the time is right when they have the funds on hand to cover the down payment and closing costs. For others the decision to purchase may be related to mortgage rates, home sale prices, or changing events like marriages, career demands, or children. 2. Find a broker you like and stick with them. As licensed Real Estate broker of New York Department of State, Harmonycity has access to virtualy all of the apartments on the market. And we share and exchange listing information with over 150 cooperating brokerage firms in Manhattan which give us access to thousands of homes for sale. Apart from the technologic support, we are also experts in neighborhoods, price ranges, market values, and Manhattan lifestyles. Because Manhattan brokers work together and share listings now more than ever before, registering with numerous brokers confuses things when scheduling apointments and touring prospective homes. Let your harmonycity agent do all of the prep work, and if you notice a listing on the market that interests you, let us know and we can schedule your private viewing ! 3. Seek pre-approval for a mortgage: You must know how much you can spend before you spend it. Condominium apartments require at least 10% down; cooperative apartments generally require at least 25% down. However, every building is different. 15% of Manhattan's buildings are condominium buildings and the other 85% are cooperatives. If you plan to finance your purchase, speak to a mortgage professional as soon as you begin your search for a new home. Mortgage brokers and bankers can help you determine what you can afford, and they will issue pre-qualification letters which indicate what you will be able to borrow based on your financial profile. Consider the monthly loan payment plus the monthly maintenance or common charges when determining what you can afford to spend. 4. Schedule apointments with your agent and visit properties: Remember to always give your agent the most complete information about your exact needs and wishes before going out and look at properties ! At Harmonycity we will never waste your time showing you properties that are not for you : Losing your time is losing ours ! Ask your agent to organize customized Open House tours on week-ends or showing by appointment only. 5. Start organizing your financial documents. When apply for a mortgage, you will be asked to prove your annual income along with all of your assets and liabilities. 6. Identify a real estate attorney Chose preferably one who is very familiar with the Manhattan coop and condo market, to represent you in the sale. You will need an attorney to represent you at closing as well as to review the contract and building financials. In a condominium or building transaction, the purchaser’s attorney will also handle te search. 7. Identify a property and make an offer ! Communicate the purchase price, financing terms, and proposed closing dates to your agent, and your agent will prepare and submit the offer to the seller or seller’s agent on your behalf. Your agent will be helpful in presenting your offer in the best possible light to a given seller. 8. Negotiate through your agent Arriving at an acceptable price for both seller and buyer is only part of the work. In manhattan, because of strict coop board guidelines, sellers have to consider the financial condition of a purchaser as well as their proposed purchase price. Sellers want to feel confident that the buyer they accept will pass the coop board application and interview. During the negocation, expect to furnish more personal financial details and individual backgroud information. 9. Go to contract. Once a buyer and seller have agreed upon terms of a sale, the seller’s attorney will prepare the contract of sale and submit it to the purchaser’s attorney for review. As part of the review, the purchaser’s attorney must review and endorse the financial condition of a coop, a building or a condo. They will need to consider the offering plan and recent financial statements. When the attorney is comfortable with the contract and other diligence, he will have the purchaser sign the document and pay 10% of the purchase price as a down payment. That deposit is held in escrow by the seller’s attorney. Upon receipt of the executed contract and deposit, the seller’s attorney should return a fully countersigned document to the purchaser’s attorney. 10. Complete the mortgage application Work with your mortgage mortgage broker or banker to fill out and submit an application for a home loan, if you are financing your purchase. Usually, you will have to report your application with bank statements and recent tax returns. Keep copies of your loan application and financial backup information-you will need them for your coop and condo board package. 11. Complete the coop or condo application. Work with your agent to complete the purchase application. Coop board’s take application packages very seriously. Your agent will advise you about what to include, how to arrange the package, and can help coordinate the all important Statement of Financial Condition included in almost every package. 12. Follow up on your home loan. Stay in touch with your mortgage broker about the progress of your application to borrow. Once your loan is approved, your broker will need to get you a commitment letter from the lender, and you will have to sign and return recognition agreements to the lender before a closing will be scheduled. Copies of the loan commitment letter and your signed recognition agreements must be included in your coop board application to purchase if you are financing. 13. Finalize and submit your board application to purchase. This package will be collated by your agent and submitted first to the managing agent for the building, and then it will be passed on to the boar of directors. If a coop board interview is required, your agent will arrange the apointments and they can help you prepare for the meeting. 14. Schedule a closing Once the board has approved your application, a closing can be scheduled. Attorneys for both sides, seller and purchaser, the lending bank for the present owner (if there is an outstanding mortgage) and the lending bank for the new buyer must all be present at the closing. You can also expect your agent to attend. At the closing, the purchase price is paid to the seller, and shares or title transfer from the seller to the purchaser. The attorneys will handle any other distributions necessary, including prorated taxes, utilities and broker fees. How long will it take for me to purchase property from A to Z ? 1. Sign a Contract: Typical time frame: 1-3 weeks. Generally, in a sales transaction, a New York City real estate attorney represents each buyer and seller. The seller's attorney draws up the contract for the buyer's attorney; the buyer's attorney does 'due diligence'-reading minutes, financial statements of buildings etc. The buyers sign the contract and forward the contract with a 10% deposit; the sellers execute the contract. Possible contingencies: Financing, Board Approval, closing dates. (See our list of closing costs associated with buying and selling condominiums and cooperatives.) The quicker the contract can be signed, the better. A contract is binding only after both parties sign it. 2. Apply for a mortgage: Receive Commitment Letter from Lender. Typical time frame: 6 - 9 weeks. Mortgage applications cannot be processed without an executed contract. If an apartment is being financed, the board requires a commitment letter from a lender. These letters are generally the last items to complete a board package/condo application. 3. Complete a Board Package or Condominium Application: Typical time frame: 3 - 9 weeks Cooperative apartment buildings require board approval before a closing can take place. Condominiums require an information packet to be completed before a closing can take place. In order to review a potential purchaser, the Board of Directors for a Coop demand extensive information in a Board Package. Most Boards request the following information: full financial disclosure (net worth) with supporting documentation, employment history, current salary, personal and business references, tax returns for the previous 3 years, credit history, etc. If a purchaser cannot or does not want to supply this information, he/she should buy a condominium. Board packages/Condo applications are given to potential purchasers to fill out after a contract has been executed. If there is no financing, it usually takes about 2-4 weeks to gather the information for the board condominium application. 4. Submit Board Package or Condo Application for the managing agent's review: Typical time frame: 1-4 weeks After the buyer's real estate agent completes the Board package, he/she will forward the package to the managing agent of the building. The managing agent will inspect the package to ensure it is complete. The package will then be forwarded to the Board of Director's of the Coop. After the Board reviews the package, they will decide if they would like to meet the potential purchaser. 5. Meet the Coop Board for an Interview. Typical time frame: 30 minutes - 1 hour Coop Boards typically meet once a month, and some Boards do not meet in August. Every Board is different, but generally a Board Meeting will be held in the evening on a weeknight. Although a board interview may be granted, this does not guarantee board approval. 6. Receive Approval from Board: Typical time frame: 1 day - 1 week after board interview The managing agent will generally alert the seller's broker whether a potential purchaser has passed the board. 7. Schedule a Closing. Typical time frame: 1-2 weeks after board approval. Managing agents generally set the date for closings, and lawyers for sellers and buyers coordinate with the appropriate banks on available dates and times. Typical Time Frame from the time an apartment is found, to the time an apartment closes: 3-5 mos. Helpful hints for completing your board package In order to review a potential purchaser, the Board of Directors reviews extensive information from the buyer in what is called a Board Package. Most coop boards typically request financial disclosure with supporting documentation, employment history, current salary, personal and business references, tax returns and credit history. The following tips will be helpful in preparing your board package.
Helpful hints for your board interview The interview provides the board with the opportunity to meet you and discuss your application in further detail. Board interviews can range from an informal meeting to a formal interview. The following tips will help you prepare.
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