Short sales are homes that are in the foreclosure process and the initial lawsuit (Lis Pendens) has begun.  During the foreclosure process, the lenders holding the lien are willing to sell at a discounted rate, i.e., they will sell the home “short” of the actual mortgage amount.  These transactions often take a little longer to close because the process requires negotiating between all parties: the buyer, the seller and lender. These homes are best suited for the primary homeowner that is looking for a turnkey home at a discount, and is willing to wait.  For the lender, it is most advantageous to sell the home in a short sale because it costs more to foreclose on the property.

REO’s, on the other hand, are properties that have already gone through the complete foreclosure process and are now owned by the lender or bank that held the mortgage. REO’s usually sell at the lower end of the home value spectrum, in comparison to other homes on the market.  Generally, they are not in the best condition, and are in need of repair. These repairs can be as extensive as a new roof or as minor as new paint and carpet.

Because of the condition of most REO’s, they are best suited for investors and a purchaser that is looking for a renovation or remodel for primary purposes.  Because of the condition of the home, many banks will not lend for purchasing, making many of these transactions cash deals.  REO closings tend to be quicker, typically occurring within weeks.

When purchasing REO’s or Short Sale homes, make sure you understand the title policy and that it is clear, marketable, and free of all existing liens.

You’ve found me!  I’ve been in the real estate business for over 15 years and have a broad range of knowledge in the real estate field.  Negotiating skills are invaluable when it comes to real estate, and that skill set is one that has brought years of satisfaction to my clients. I can direct you to the right financial representative, lawyer, and any other contact you may need, even after closing.

Step 2: Initial visit

While I get acquainted with you and your home I will present to you a list of the services that my company and I provide.  During the visit, I will also suggest some recommendations to make the home buyer friendly.

Step 3: Price evaluation and marketing plan

I will present you with a Comparative Market Analysis (CMA) with comparables that are similar to yours in location, size and type, whether it is a condo, co-op or townhome.  This will lead us to price your unit according to market value.  *Note that the closer your home is to market value, the larger your buyer pool is.  If your home is priced higher than market value, there will be far less activity.  I will monitor this activity level for the first 30 days; if I don’t see activity, than a price adjustment will be recommended.

Step 4: Signing an exclusive agreement

With this type of listing agreement you have a particular agent and firm that will market your property. In this agreement: price, length of listing and commission is written and adhered to.  If you choose me and my firm to represent you, I will be your point of contact, and I will handle all marketing, arrange showing appointments, oversee the board process and handle the negotiations.  * The commission agreed upon will be shared with any other firm that brings the buyer.

An open listing is another agreement in which you manage the process and do not give an exclusive agreement to any firm.  Commission is paid solely to the firm that brings the buyer.  Often for the same amount of commission dollars you are performing all the work yourself.  There is no one marketing your home, advertising it and negotiating on your behalf.

Step 5: Marketing the property

Each property and owner has their own set of needs that are completely different than the next; therefore, a marketing plan has to be tailored to those specific needs.  In general the marketing plan will consist of listing the property on On-Line Residential, REBNY and the Manhattan MLS.  We will also co-broke with every Real Estate Firm in Manhattan which includes visibility to 28,000 agents.  In addition, the property will be listed on various websites, including our Charles Rutenburg site.

Digital pictures, virtual tours and strategically planned open houses are standard.

Step 5: Providing feedback

During your listing’s timeline, I will be in communication with you providing buyer feedback, information regarding changes in the market, and new and creative ideas on how to attract a viable offer.

Step 6: Qualifying buyers

In order not to waste valuable time, I will ensure that any prospective buyer is financially qualified to purchase the unit.

Step 7: Negotiating the offer

At the point when you have received an offer, I will discuss the negotiation strategy that will take place.  I will then convey any counter offers to the buyer or buyer’s agent.  They may “counter” your “counter” during this process; we will agree to price, terms and closing date.

Step 8: Signing the contract

In all New York City real estate transactions an attorney is needed.  Your attorney will write the contract with all the specified terms and conditions.

Once the contract is reviewed by the buyer’s attorney, and everyone is comfortable with the conditions, the buyer will then sign the contract and place a standard deposit of 10% of the purchase price. The deposit will be held with your attorney escrow account until the day of closing.

Step 9: Board package and approval

I will work closely with the buyer’s agent so that all required documents such as: co-op or condo financial statements, by-laws, board meeting minutes, offering plan, etc, are all received and reviewed within the specified time.

Step 10: Closing

I will confirm closing date, location and settlement with you and the attorney’s.

Step 12: Closed – transaction completed

Congratulations!

Note: Every contract is unique and provides a timeline with a step-by-step guide for you to keep track of.  Most items are time sensitive, so strict guidelines will be followed throughout the process.

You’ve found me!  I’ve been in the real estate business for over 15 years and have a broad range of knowledge in the real estate field.  Negotiating skills are invaluable when it comes to real estate and that skill set is one that has brought years of satisfaction to my clients. I can direct you to the right financial representative, lawyer, home inspector, and any other contact you may need; even after closing.

Step 2: Buyer consultation

This is where we meet to discuss your real estate needs.  Our initial meeting will help me determine what you are looking for by evaluating what you want and need in a home in the Manhattan real estate market.

Step 3: Mortgage pre-approval

The pre-approval process will let you know how much you can spend so that you don’t go over your budget. You will be referred to a mortgage broker or direct lender for this part.  If you have a banker you like doing business with, maybe ask them to refer a loan officer. Usually takes 1 to 2 days.

In this step you should start putting together all the documents you need to apply for a mortgage, i.e. bank statements, last 2 years of your taxes, last 2 paystubs.

Many agents think that this should be your first step.  But I think even if you cannot purchase at the moment, maybe we can start evaluating your wants and needs and get you familiar with the real estate market and when you’re ready, the process would already be familiar and not overwhelming.

Step 4: Viewing property

From the information collected in step 2, I start your search and give you access to my Manhattan listings search system in order for us to start looking at potential homes.  This step will depend on your schedule.

Step 5: Making an offer

At the point when you have found a suitable property, I will then discuss the negotiation strategy that will take place.  I will then convey your offer to the seller or seller’s agent.  They may “counter” thereby beginning the negotiation process, where we agree to price, terms and closing date.  Usually 1 day or more, depending on buyer and seller

Step 6: Signing the contract

In all New York City real estate transactions an attorney is needed.  The sellers’ attorney will write the contract with the specified terms and conditions and your attorney will review them, in addition, your attorney will also review the co-op or condo financial statements, by-laws, review board meeting minutes, offering plan, etc.

Once these things are reviewed and everyone is comfortable with the findings, you will then sign the contract and place a standard deposit of 10% of the purchase price. The deposit will be held with the sellers attorney escrow account until the day of closing.  Usually 1 day or more, depending on buyer and seller

Step 7: Apply for the mortgage

You already have a pre-approval letter, now you have to apply for the mortgage.   In step 3 you started putting your documentation together, now you deliver all the documents to the loan officer.  Within several weeks you should receive a commitment letter from the bank. Usually takes a few weeks.

Step 8: Complete the board package

I will look into what is required for this step as co-op and condo boards may work differently.  You may have to submit the same documentation that you provided for the loan process including the sales contract, letters of personal and business references and the commitment letter.

For co-ops in New York, once your application has been reviewed and it meets initial approval, you will then be asked to attend an interview.

For Manhattan Condos, once your application has been reviewed your approval is generally granted.   Usually takes a few weeks.

Step 9: Board Meeting

For a board meeting, please make your schedule available as a meeting is usually held certain times and days of the month.  Please treat this as an interview; some boards are strict as to who lives in their buildings.  Usually takes less than an hour.

Step 10: Board Approval

Usually comes within days of the board meeting.

Step 11: Closing

I will confirm closing date, location and settlement with you, as well as the attorney’s.

Step 12: Closed – Transaction completed

You receive keys and schedule move in.

Congratulations!  You now own a Manhattan apartment!

*This is a general list – note that a few items will get done at once when you’re in contract.  These items depend on the terms of the contract (i.e.  If a home inspection or appraisal are contingent to the contract.)  If they are, they will be added as additional steps to be taken.  Every contract is unique and provides a timeline with a step by step guide for you to keep track of.  Most items are time sensitive, so strict guidelines will be followed throughout the process.

In the New York real estate market, cooperatives (co-ops) have been around for a long time; in fact they are the majority of the inventory in Manhattan real estate.  Co-ops account for about 75-80% of the inventory for sale, while condominiums and townhouses make up the other 20-25% of the market share.  

Cooperatives are different than condominiums in that condos owners own real property and co-op owner don’t.  When you purchase a co-op you are purchasing shares of an apartment corporation.  The shares in the corporation entitle you to a long term lease in that unit.  Expenses such as real estate taxes, building upkeep, and employee salaries are split between the shareholders.  The number of shares owned by the tenant-owner is usually determined by the size and floor level of the co-op, usually larger co-ops located on top floors have a larger share than those on lower levels with a smaller square footage.     

Things to keep in mind when purchasing a co-op:

·         Cooperatives board approvals are more stringent than that of a condo; board has more control of who becomes part of the building.  

·         Cooperatives buildings boards decide the amount of money that is used to finance the unit.  Verify the down payment that you will need to purchase into the cooperative, in Manhattan down payments are usually between 20–50%.

·         Because of the buildings tax structures, coop owners have great tax breaks, such as tax deductions due to real estate taxes, interest on the mortgage and the monthly expenses.

·         Co-ops boards frown upon investors, so more often than not they only approve primary owners.

·         If you intend on subletting your unit, be sure to check the board guidelines and rules, many boards only let you sublet for a year with a certain time period.

·         Verify that the building is well maintained with high standards, security and quality of services.

Happy co-op shopping!

Note: These numbers may vary depending on the loan type and negotiation of the transaction

Note: These numbers may vary depending on the loan type and negotiation of the transaction.

Typical Closing Cost for a condominium purchase

Many people prefer purchasing a condo over a cooperative (coop) because financing for condos are more flexible and require less of a down payment.  Also, when applying to the building board, rejection is significantly less, coop boards are more stringent. Condos make for a relatively good rental property as some coop boards frown on subletting or leasing your unit, for this reason it also makes for a better investment for a non- U.S. citizen to have assets in the United States.

Many condo residents get to enjoy the ease and convenience of having common areas maintained by the condo board rather than doing it themselves as they would if they owned a single family home.

More importantly condo residents have access to many building amenities. In New York City, condominium buildings have amenities that include but are not limited to gyms, laundries, storage facilities, concierge, gardens, roof top decks, pools, etc.

Things to look for when purchasing a condo, ensure building upkeep, inquire about the amenities, confirm the common charges and most importantly make sure the building and board has liquidity for future projects or renovations.

The reason many sellers and banks would prefer to do a short sale over letting the home foreclose is because for sellers their credit will not be as impacted and for banks it costs less to sell as a short sale rather than foreclose.

In order for a seller to qualify for a short sale they must be experiencing financial hardship. These transactions typically take several months; however there have been a few occasions where it has closed within a couple of weeks from contract.

Earlier in 2010 the listing provider, “On-Line Residential” instituted a new software that allows customers the opportunity to view all Manhattan listings from the Real Estate Board of New York’s (REBNY) database from one web site. The system called VOW, which stands for Virtual Office Web site, is a way for real estate firms to provide its prospective customers with access to search all New York sales and rentals. It is the closest model Manhattan has to a Multiple Listing Service (MLS) system.

It is definitely a big step forward for New York. Being familiar with the MLS system in the state of Florida, I was stunned to see that New York did not provide a shared centralized listing system. In fact the status quo is exclusive listings for real estate offices, which is an extreme disservice to the seller. The extra exposure a listing gets when it’s shared amongst thousands of brokers is the possibility of the property being either sold or rented much sooner – it’s marketing at its best.

It’s hard to believe that a city such as New York, with all its infamous landmarks and most expensive addresses in the world continued to thrive under such old traditional ways of selling property until just recently; although it’s a step forward we still need to improve on this technology. New York Real Estate firms have to do away with exclusives – it’s about exposure. Come on REBNY, Manhattan needs an MLS.

What will it take to convert New York’s established ways to a more modern system like MLS?

This fee helps to raise the overhead expenses for the building without imposing additional fees on the residents; the fee is normally used to make capital improvement to the building. The flip tax fee is based on the sales price or the net profit from the sale of the unit. It can also be an amount based on the number of shares in the cooperative or just simply a flat fee.