Admissions committees of Coop Boards have the right to accept or reject those who apply to become owners of a Coop in their building. The theory here is to make sure that their neighbors are people of good character with the financial ability to keep up with the monthly payments that will be required of them. If you are a prospective purchaser in a coop you want to “put your best foot forward” to maximaize your chances of board approval. The following are red flags on applications that could affect your chances of approval:
1. Don’t fudge your numbers. Make sure you submit sufficient backup documentation such as current bank statements to substantiate your numbers.
2. If you have a pet, make sure pets are allowed. It is also important to make sure the contract indicates that your pet will be occupying the unit as well.
3. Past payment history. The Board will check your past landlord reference to see if you pay your rent on time and to see if there has been any prior litigation with you.
4. If you are in the process of selling your existing Coop or home. The Board will be reluctant to approve someone where you must sell your present home. Their concern here is that if they approve your application and you have not yet sold your present home, you will be financially strapped for a period of time. This may lead to your inability to keep up with your payments.
5. Google yourself. Whatever is out there about you should be addressed. You can be sure that the Board will use this tool to check you out.
6. How good is your credit? The Board will likely run a credit search on you. If your credit is poor, chances are you will be rejected. If it is average, bit you have some judgments against you, make sure you address these and pay off if possible. Proof of satisfaction of judgments should be attached to the application. Letters of explanation can also be helpful to explain circumstances that may put you in a better light with the Board.
The approval process is stressful enough. So keep these issues in mind when applying for Board approval.