The NYC real estate challenge: getting approved by a Manhattan co-op board

BOO! Did it scare you? Probably not.

On Halloween, all those ghosts, goblins, witches and warlocks (pint-sized and bigger) can look terrifying. But they’re not. You know the ritual, and, along with the rest of society, you agree to view the holiday as an occasion for delight rather than dread.

Turns out, a similar dose of understanding and acceptance can sustain you through the New York City home buyer’s scariest encounter: the much-feared coop board interview. 

This face-to-face meeting can feel like a test of personal worth, rather than an objective assessment of your financial health, but in the vast majority of cases, the conversation turns out just fine. Just another of life’s little tests, it can be aced with the proper preparation, and study, along with some capable coaching from your broker. Truth is, boards are happier than ever before to accept solid newcomers to their communities.

The good news

As for all those news stories about celebrities who were rejected by their buildings? Those are exceptions to the rule.

Former president Richard Nixon, singers Barbara Streisand, Madonna, Mariah Carey, Billy Joel and Cher, and actor Antonio Banderas, newsman Mike Wallace, and Designer Calvin Klein; all discovered that fame and wealth weren’t enough to guarantee admission to, or a peaceful relationship with, an upscale New York City coop board. But unless your presence is likely to generate round-the-clock crowds of paparazzi, you probably won’t face the same kind of grilling these folks did.

Protected areas

Legally, real estate buyers are protected in 14 separate areas.  The Federal Fair Housing act, the Civil Rights Act, and the New York State and New York City Human Rights laws, prohibit discrimination on the basis of:

-age

-alien status

-children (or childless state)

-country of national origin

-creed

-disability

-gender (including gender identity)

-lawful occupation

-marital status

-military status

-partnership status

-race

-religion

-sexual orientation

Once your rights are assured in those areas, though, you basically enter what one NYC real estate attorney describes as the ‘land of anything goes.’

The Real Estate Board of New York (REBNY) and the Council of NY Cooperatives and Condominiums (CNYCC), among others, guarantee the rights of the boards themselves. Made up of shareholders, these governing groups can refuse any applicant, no questions asked, as long as they stay clear of open discrimination.

Singer Mariah Carey was turned down flat by a Manhattan luxury building years ago, most likely because the then-single young women was viewed as a bad credit risk who toiled in a fickle business. Former President Nixon was nixed for sheer notoriety while, more recently, Dominique Strauss-Kahn had a devil of a time finding a place to await his hearing. None of these decisions were completely unexpected, nor were they enormously surprising.

Bank on your broker

With some cooperative boards of directors noted for prickly decision-making, the key to helping a new buyer pass the test on the first try often falls to the real estate broker.. A good realtor will know the peccadilloes of each individual board, and be completely up-to-date on the rules of the building itself.

I always remind my new buyers set aside some prep time, so we can rehearse the upcoming interview process.  Together, we explore the ‘what ifs’ and the ‘must-haves’. If I anticipate a particularly tricky situation, we conduct a mock interview. Because each board – and each board member – has a distinct personality, there’s no one-size-fits-all way strategy.

A good broker will also fully brief the buyer on the building’s guidelines, the ways they have been enforced in the past, and the general rules drawn up by the REDNT and CYNCC for coops. Many building have specific restrictions on pets, noise, and carpeting and renovation guidelines.  Again, provided these regulations don’t violate any civil rights guaranteed under state or federal law, they’re completely permissible.

On the other hand, boards should be open about sharing their meeting schedules, their interview process, and their approval schedule.  If they ask for some time-consuming records (for instance, credit checks from out of state) they can and should understand that it adds time to the approval process.

Thankfully, most buyers pass their test with nary a problem. In fact, 95 per cent of my buyers have survived the initial interview completely unscathed and the few who haven’t gotten the nod the first time out, have been approved soon afterwards. Some people even enjoy the interview process.

Yes, it’s a test. But unlike a driver’s license, a professional certification or an eye exam, it’s a once-in-a-lifetime challenge.

Pass it, and you’re done.