Queens Real Estate Transaction Overview
It is difficult to estimate how long the process will take, from acceptance of an offer to closing. Assuming a loan can be secured in a timely fashion, one can move from contract to closing on a condo/residential home in about 60 days. However, the cooperative process is more involved, and 60 to 90 days is not unusual. The steps to purchase or sell a co-op or condo/residential home are very similar and outlined below.
Once an Offer is Accepted
After an offer is accepted, the seller's attorney will begin preparation of the contract of sale. During that time, the Buyer's attorney will perform ‘due diligence’ by examining the offering documents and financial condition of the subject premises to determine if there are any legal or financial problems with the building where the apartment is located.
- Offering Plan
- House Rules
- Financial Statements
- Title Report (Condo/Residential)
- Minutes - reviewed at the managing agent’s office (Co-op)
- Proprietary Lease (Co-op)
Financing Contingency Provision
A contract, lacking a financing contingency provision, does not allow for a purchaser to receive a refund of the contract down payment if they are unable to procure financing. As lenders use appraisal value in determining whether they will issue a loan, a purchaser should be wary of making any representation about their ability to obtain a loan even though they have completed a pre-qualification process. Should the appraisal value be less than the sales price, the purchaser would be responsible to fulfill obligations of the contract by providing the difference out of their own funds.
Purchaser will sign four copies of the contract and provide a personal check payable to the order of the seller's attorney (usually equal to 10% of the purchased price). The contract deposit can be negotiated between the parties on a case by case basis. The contracts and the down payment check are then delivered to the seller's attorney for seller’s signature.
The sellers' attorney will hold purchaser’s down payment in his trust or escrow account until closing. Thereafter, the seller counter-signs the contract, the seller's attorney signs the contract acknowledging receipt of the down payment and two fully executed copies are returned to purchaser’s attorney. It is important to note that until all parties have signed the contract, and it has been delivered, the seller can still entertain and accept other offers.
- financial statement with all requisite supporting documents
- two years of tax returns
- bank statements
- letters of personal
- letter of financial reference,
- letters of professional reference
- the contract of sale
- loan commitment letter (if financing) indicating that your loan is in place, etc.
When the "package" is complete, it will be reviewed by your real estate broker, and then, assuming it is accurate, it will be forwarded to the managing agent for review. Upon determination that it is in order and that credit checks were acceptable, the package will be forwarded to the Board of Directors. No applications will be accepted by a Managing Agent unless they are complete. The approval process can take approximately 3 to 8 weeks after submission of the "board package".
Condo Board Approval
The sale of a condominium is conditional upon the Board of Manager’s issuing a Waiver of the Right of First Refusal, unless you are purchasing directly from the developer. Your purchase contract provides that you promptly submit your application for board approval after issuance of a financing commitment, if any. You must cooperate with the condo board requests and provide any documentation it requires to issue the waiver.
Co-Op Board Approval
Preparing for Closing
- Seller & Seller’s Attorney
- Purchaser & Purchaser’s Attorney
- Purchaser’s Lender’s Attorney
- Real Estate Agents Involved,
- Title Company Attorney (condo only)
- Seller’s Bank Attorney (co-op only)
- Representative of Managing Agent (co-op only).
- The purchaser receives title to the condominium/residential home or the stock certificate and proprietary lease of a cooperative corporation
- Purchaser’s bank closes its loan and issues its loan proceeds to the purchaser, who in turn transfers them to the seller as part of the balance of purchase price
- Purchaser pays the remaining balance, if any, of the contract price due
- Seller and purchaser pay their respective closing costs
- Title company guarantees both the bank and the purchaser that the purchaser is obtaining good and marketable title free of all judgments, mortgage and other items (condo/residential)
- Any liens on the co-op shares, reflected on the UCC search, are satisfied (co-op).
After the closing, you will receive a Closing Statement from your attorney detailing the financial aspects of the closing and copies of the documents executed at the closing.
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Whether you are looking to buy, or sell a home in Queens NY, the truth is that it can be a very complicated process and a small mishap along the way can kill a deal. From Condo/Co-Op Board Applications to Inspections, Appraisals, Negotiations, Board Interviews, Liens, Illegal Extensions, etc. That's why it's important to have a local Queens real estate expert and true advocate in your corner throughout the process. Now, being that there are good & bad Realtors out there, it is also very important to do your research so you find the right Queens Realtor for you and your family.