So what do they look at? 

• Debt-to-income ratio    
• Mortgage lenders generally want no more than 28% of a buyer’s gross monthly income to the mortgage payment (Principal, Interest, Taxes and Insurance), or a maximum of 36% for PITI and recurring debt (loans, credit card payments, child support, etc)
• Co-op Boards usually want to see something closer to 25-30% debt-to-income
• Income – liquid income
• Generally the last 3 years of tax returns are reviewed for gross income and adjusted gross income
• Earning Potential – if your earnings are less than board guidelines, or assets are too weak, but you can show potential for increased income, the board may approve with conditions such as a year’s maintenance held in escrow.
• Debts
• Boards also consider other debts, student loans, car loans, other mortgages.
• Other Factors
• Location – locations such as Brooklyn or Queens may be less likely to look for large assets and permit more financing than a building on Park Avenue in Manhattan
• Building size – larger buildings could be easier to buy into than smaller buildings because one or two arrears owners have less impact in a 200 unit building than a 20 unit building.

Boards want to protect their co-op, choosing people who are the right fit.  They also need to stay within the boundaries of discrimination laws.  Reviewing the financials allows the board to decide whether to move forward or not without violating the discrimination laws.

Excerpted from Habitat article

A few tips to make it through the process:

• The board can be discriminating  (picky if you will) but not discriminate for reasons of race, color, religion, national origin, sex, age, family make up, disability, sexual orientation or citizenship status.
• Appropriate information for basing a decision
• Can you afford to pay maintenance charges
• How many people will live in the unit
• Income, credit, residential history and employment history
• Some boards request a preliminary application which is reviewed by a board screening committee to determine if a purchaser is eligible.  If so they move forward with the full application package.
• Application package
• Residential History
• Bank history
• Employment History
• Hobbies and Interests
• Interest in board or committee service
• Anyone who will live in the apartment
• Full financial disclosures.  See our post: What Co-op Boards look for in your Financials.
• Community Values
• Assess compatibility with the co-op and its character.
• Some boards allow opportunity for you to ask your own questions
• Have pets?  Some boards want to ‘interview’ them as well (Read about it in our article: Co-op Board Interview for Pets!)
• Each board has their own guidelines
• After the Interview
• After review, the committee will give recommendation to the board, who votes on the purchase.
• Letter sent to seller with decision, with copy to purchaser and co-op’s attorney
• Co-op’s attorney will communicate with all attorneys involved to arrange closing.

Excerpted from Habitat article

There are a number of trainers who now specialize in preparing dogs who face the scrutiny by New York City co-op boards.  Ms. Renee Payne, owner of Walk This Way , a canine behavior therapist designed an interactive interview process for co-op buildings to evaluate potential canine residents. 

• Frustration tests to see how easily a dog loses patience and whether or not it acts out if it does not get what they wanted on demand.
• Separation Anxiety tests to determine if the dog can remain calm when the owner is asked to leave during the interview.
• An Elevator test to see a dog’s response riding the elevator and strangers getting on and off.
• Doorbell tests to see how many times the dog will bark when the doorbell is rung. 

Excerpted from New York Times Article by Sarah Kershaw on August 23, 2011.

When a colleague sent me this link reporting the story, I remembered a similar problem that my wife and I  had with an upstairs neighbor (not music- but walking both human and canine). Fortunately, carpeting resolved the problem and our “quiet enjoyment” was restored. If you live in New York City you should expect noise from police cars to fire engine sirens, horns and car alarms, garbage trucks and yes from your neighbors as well.

If you are moving from a quiet suburban neighborhood or if you are particularly sensitive to noise here are some suggestions to test your decibel tolerance before you buy an apartment in Manhattan.

• If the apartment is located near an elevator, public laundry room or trash room make sure mechanical noises can’t be  heard.
• Check to see if the windows have been upgraded to reduce street noises  as well as  energy costs.
• Depending on the floor of the apartment, you may want to listen carefully- especially in rear courtyard facing rooms-for fans and other mechanical noise creating devices on adjacent rooftops.
• Ask the seller’s/showing broker to turn off or lower any music playing in the apartment.
• Before signing the contract, visit the apartment at different times of the day. A morning visit will expose the going to work noises,  an afternoon visit will let you concentrate on street and traffic sounds and the evening visit may give you some insight into the level of noise you can expect from prospective neighbors  are reading or blaring their music or TVs?
• As part of your due diligence, you and/or your attorney should read the  co-op or condo meeting minutes and see if there are any noise issues discussed.

Generally speaking, a co-op board will have more jurisdiction and clout over noise matters. Based on their bylaws a co-op board may be able to levy fines until the offending shareholder complies or, as with Madonna,  threaten and ultimately have the shareholder evicted. Condos generally do not have this power and,  it may be completely up to you to bring any legal pressure on your fellow condo neighbor.