Typical Questions Answered:

• What do I need to facilitate the buying process so I do not miss out on a great deal?


• The New York City real estate market is extremely competitive. The most desirable and affordable properties can go to contract in a matter of days. The most important factors in getting a deal to closing include the following:
  
  Annual Income - Generally you can borrow up to about 2xs gross annual income. Monthly mortgage and maintenance payments should not exceed 1 weeks gross salary. If you have significant liquid assets you may be able to borrow more.
  
  Financial Statement - It should lists net worth including assets, liabilities, salary, bonus, etc. The most qualified buyers are usually the ones whose offers are accepted. Having a complete financial statement is very important when there is an apartment or property with multiple bids.
  
  Asset Valuation - A down payment alone does not qualify a buyer for a co-op or a condo in Manhattan. Usually, a co-op board or condo association wants guarantees for mandatory maintenance fees. They want assurances against unexpected loss of income. Many co-ops require liquid assets totaling 1 year's worth of maintenance and mortgage payments after closing. Also, some buildings require liquidity up to three years of combined costs. 


• Why select a real estate attorney?


• The real estate market in New York City is a very dynamic market. Having a real estate attorney who specializes in the NYC market is very important. First, they know the intricacies of the laws and regulations. Second, they can respond quickly to any problems that arise and can therefore expedite the closing.


• What is a closing?


• A closing is where a buyer gives the seller money in exchange for ownership and title to a particular property. This bargained for exchange, or consideration, transfers ownership of the property. The seller also needs to sign different documents including a deed. The place of closing is normally at the bank attorney's office. The parties present will be: seller, bank attorney, brokers, seller's attorney, buyer's attorney and title closer.


• What are the steps in the application process?


• For mortgage applications and for co-op or condo boards, buyers need to gather relevant financial documentation. Required documentation includes 2 months of most recent bank statements, brokerage statements and any other assets. In addition to current income verification, boards and banks require a minimum of 2 years of federal income tax returns. Self-employed buyers need to provide at least 3 years of federal tax returns and a letter from an accountant verifying income.


• When do I need to move?


• Find a target date for moving. If looking to finance, expect to take about 3 months from purchase to close. Buyers, begin your search 4-6 months before prior to an estimate moving date.


• Question: Where do I want to live?


• New York City is a city of diverse neighborhoods, all with their own unique appeal. Before beginning your search, decide what is important. For example, proximity to public transportation or proximity to your job. Are your preferences for a quiet residential neighborhood or a bustling hub of activity and nightlife? Try to be open to different areas as sometimes neighborhoods other than your first choice are more affordable and offer many of the same features.


• What is the best way to win over sellers?


• If you really want to buy a particular property that has a lot of interest, sell the seller on the fact that you are a qualified buyer. It doesn't matter whether you plan to buy a studio or a building, chances are that there is a limited number of properties available in your price range.
  
  Brokers tend to notify serious buyers first. Make sure that you are ready to buy; have all your paperwork in order including financial documentation and pre-approval for a mortgage. Communicate yours needs, budget, timetable, and neighborhood preferences.
  
  Make yourself available to view properties. By being flexible with viewing properties during the work week, you can avoid weekends shoppers, congested open houses and a lot of the best buildings tend to show properties between 10-3, M-F.


• How do I make the deal happen?


• After finding the property you want, immediately make a non-binding offer. There are a lot of different reasons, other than money, that influence a seller in choosing the right buyer. If the offer is accepted, have your broker get confirmation of the offer and acceptance in writing. Once the written offer is accepted, the seller's broker prepares a transaction summary. This is sent to the seller's and to the buyer's attorneys for review. Using the signed offer and acceptance, the seller's attorney then prepares a contract of sale. After the buyer's attorney reviews the contract, negotiates terms and evaluates the property's financial statements, the buyer then signs the contract and transfers the down-payment. Generally, down-payments are 10% of the contract of sale. This money is often held in the selling attorney's escrow account. The seller then executes the contract.
  
  Note*: In the New York City area an offer is not legally binding until both the buyer and the seller sign a contract of sale. Sometimes sellers are tempted by higher offers. To avoid problems, be prepared and have your attorney move quickly through reviewing financials and completing the contract.