WWYD: Coop Board Rejected Third Buyer

Third time isn't the charm.

I have a friend who has been paying 2 mortgages for the past 2 years because his coop board refuse to approve the past 3 buyers (of his coop) including 1 all cash and 1 buyer who is already living in the building at the time... They refuse to give him a reason too.

What recourse does he have, if any? It pains me to see him going through this.

Message edited 12/13/2011 11:39:18 AM.

Re: WWYD: Coop Board Rejected Third Buyer

You never have recourse with a co op board. They can reject whoever they want for no reason at all.

The key is finding someone that has MONEY IN THE BANK.

I had a co-op in Forest Hills. When I sold, I needed to make sure the buyer had not only the money for the apartment (20%) but they money in the bank after closing to be able to pay maintenance and mortgage for a year.

I heard horror stories about boards rejecting buyers, but I got lucky with mine. Her dad acted as the buyer and they combo'ed incomes so that they had enough between the two of them to get thru. That was how I got thru too.

Re: WWYD: Coop Board Rejected Third Buyer

Owning a coop sux then!

Another buyer was also very qualified and had alot of money in the bank but was rejected 'cus apparently his portfolio was losing too much money the past few years - hello! we're in a recession!

Re: WWYD: Coop Board Rejected Third Buyer

Re: WWYD: Coop Board Rejected Third Buyer

I think the coop is well-priced 'cus there's a good share of buyers who want to get it. I don't think price is the issue.

I think the board is just being difficult. The problem is the now the coop board has a reputation has being tough which is going to hurt the chances of getting the unit sold.

Legal action would be ideal but attorneys don't seem to want to touch the case 'cus it's not a half mil or million dollar coop so less potential for $$

Is there a way to take legal action against the board on your own?

Re: WWYD: Coop Board Rejected Third Buyer

Re: WWYD: Coop Board Rejected Third Buyer

I believe under NY state law, a co-op board can reject an applicant for any reason (or no reason), as long as the decision is not based on illegal discrimination (e.g., race, religion).

Even if there was such unlawful discrimination, that is often a hard thing to prove. You could file a Fair Housing claim (under the Fair Housing Act); I believe anyone can file a claim (even if you are not the victim of the discriminatory behavior)... you don't need a lawyer. HUD will investigate the claim, and if there is cause to file suit, the DOJ may file a civil action in federal court.

But keep in mind that litigation is very time consuming and can drag on forever. So if you are looking for a quick fix, this is not it.

If there is no indication of any Fair Housing issues, I don't know that you could even institute a lawsuit. What would be the basis of the claim? You have to have a legal claim (breach of contract, violation of a statute, etc.) in order to file a lawsuit.

Is there anything in writing (in your offering plan or proprietary lease or anything) that provides criteria the co-op board must use in evaluating applicants? If not, then unfortunately I think the co-op board can be as arbitrary as they want to be.

Perhaps you can approach the board or a particular member and explain that you really want/need to sell, you've had several interested buyers who've all been rejected by the board -- perhaps they can explain what they are looking for going forward so that you can find a suitable buyer. I mean, maybe they won't give you the reason why they rejected as specific individual, but perhaps they will be forthcoming about what they are looking for/requiring in general.

Re: WWYD: Coop Board Rejected Third Buyer

That stinks, I'm sorry! We found selling our co-op to be a bigger PITA than buying a house. I hated having to wait until a week before closing to see if they would approve them or not.

Re: WWYD: Coop Board Rejected Third Buyer

which is why I tell everyone who lives in a co-op to be proactive and get involved with the board & possibly run for a board position.

Re: WWYD: Coop Board Rejected Third Buyer

What about the right of first refusal......your friend should read her proprietory lease and see if there is a loop hole for right of refusal......that means that after the first turn down, the board has to buy the apartment.

Re: WWYD: Coop Board Rejected Third Buyer

Thanks all, I'm wondering if anything can be done to make it so the board wants to get rid of you so would approve your next buyer w/o being so strict...