FAQ

My landlord increase 30% on my free-market apartment. Is it legal?

annechang

Q: Is it legal that my landlord increased much rent on my free-market apt?

Answered by Neil B Garfinkel, Esq. Partner of Abrams Garfinkel Margolis Bergson, LLP  http://agmblaw.com/professionals/bio/neil-garfinkel

A: Free market apartments” or “market rate apartments” are apartments that are not subject to rent regulations.  Accordingly, the landlord of a free market apartment is not legally bound by any limitations on the rent being offered to the existing tenant upon renewal (nor is the landlord even obligated to offer a renewal lease to the existing tenant).  Similarly, the landlord has no limitation on the rent being offered to potential new tenants.  The opposite is true of rent stabilized apartments where landlords are required to offer renewal leases to existing tenants and the rent at which the apartment is offered and renewed is governed by the rent stabilization laws.  (more…)

Homeowner Insurance for cooperative or condominium apartments

annechang

Q: My building already has the insurance.  Why should I purchase a homeowner insurance?

Answered by Ralph Coti, Esq http://jadestonerealestate.com/nyc/ourteam/ralph-coti/

A:  Most coop apartment owners and condo apartment owners are aware that their cooperative corporation (Co-Op) and condominium associations  (Condo) provide insurance which they pay for indirectly through their maintenance and common charges.  That insurance coverage, although very real, also is very limited.

In most Co-Op and Condo buildings, the insurance which is provided through the building management covers only the Afour walls.  If your Co-Op or Condo unit suffers damage as a result of a fire, a hurricane, burst pipes, leaking pipes from a higher floor or the like, the insurance normally will repair a unit owner’s walls, floors and ceilings.  A unit owner’s personal properly will not be covered by the insurance.  That means that the unit owner will have to use his or her own resources to repair or replace the damaged or destroyed carpeting, wall hangings, flat screen TV, etc. (more…)

General mortgage required docs for Self-Employed borrowers

annechang

Q:  General mortgage required docs for Self-Employed borrowers

Answered by Nicole McCarthy http://www.mortgagemaster.com/nmccarthy/

A:  

Business Ownership & Getting a Home Loan

Your federal income tax returns are required for the purposes of documenting ability to repay in securing a new mortgage.   The standard requirement from a lender is to see two or three years’ proof of income, although a few may accept as little as one year in certain circumstances.

Definition of a Self-employed borrower:

  • Sole proprietorship
  • Any business entity where income is derived or lost (including all affiliated corporations)income derived from real estate and dividend income are all included in the self-employed bucket.
  • Bona fide W2 employees who also have an ownership interest in the company can actually be considered self-employed. For example, if you’re a W-2 wage earner employee and you have an ownership interest in the company that employs you – and the interest is more than 25% of the business, this would earmark you as ‘self-employed’ for the purposes of completing a mortgage application. If you happen to be a W-2 wage earner, but you have a percentage of ownership in another business, you would be considered both an employee and self-employed.

Income is determined by using the last two years tax returns and is calculated as follows: (more…)

What is a Non-Warrantable Condominium?

annechang

Q:  What is a Non-Warrantable Condominium?

Answered by Tony Jao http://mortgage.snb.com/TonyJao/

A:   Getting a home loan or mortgage in NYC can be complicated especially if you are trying to purchase a condo that does not meet Fannie Mae and Freddie Mac requirements – also referred to as a non- warrantable condo. This information provides an in-depth explanation of what a non-warrantable condo is and how you can finance one. It details the various requirements and documents necessary for getting a home loan in this sort of unique NYC condo.

What is a Non-Warrantable Condominium?  A Non-Warrantable condo is any condo that does not meet Fannie Mae guidelines. There are many rules and regulations to “Warrant” a condo with Fannie Mae.  The five requirements for Fannie Mae to approve or warrant a loan in condo follow below.

Fannie Mae Requirements for Warrantable Condos (more…)

Tax Consequences of a Sale of a Principal Residence

annechang

Q: Tax Consequences of a Sale of a Principal Residence

 Answered by Ralph Coti, Esq http://jadestonerealestate.com/nyc/ourteam/ralph-coti/

AThe sale of one’s primary residence at a gain is good financial news for the Seller but the gain also is subject to capital gains taxation both by the IRS and by New York State.  Fortunately, there are some significant exclusions which can allow most taxpayers to avoid all or almost all tax liability.

The biggest assistance in reducing the tax liability of sellers of personal residences is the exclusion from taxation of the first $250,000of capital gains on the sale of real property if the owner(s) used that property as a primary residence for two of the five years immediately prior to the date of sale. The two years of residency do not have to be continuous.  The exclusion doubles to $500,000 for owners who file a joint tax return.  (The source of this exemption is Section 121 of the Internal Revenue Code.)  The $250,000 exclusion from capital gains taxation ($500,000 for joint filers) is available to owners of condominiums, co-ops and single-family houses. (more…)

Be the Winner of a Bidding War!

annechang

Q:  Be the winner of a Bidding War

 Answered by Anne Chang http://jadestonerealestate.com/nyc/ourteam/annechang/

ABidding wars are everywhere in Manhattan.   (Including other boroughs like Brooklyn or certain neighborhoods in Queens.)  The  Strong economy and stock markets, Low inventory and historically Low mortgage rates continue to drive our real estate market.  Buyers are often facing strong competition on the properties they like.  Large down-payment buyers with no contingency and/or All-cash buyers!

How can you be the winner of a Bidding War?  Is the offering price the only element that matters?  Not necessarily.  There are other elements that affect a Sellers’ decision.   I’ve represented many buyers and often we are very lucky to win the apartments over the competition.  I’ll sum up the following elements that most sellers use to evaluate and assess the buyers.   The understanding for these elements have worked effectively with my clients and I think they definitely contribute to our successes in the bidding wars as we always come fully prepared!  (more…)

Rent or Buy?

annechang

Q: Rent or Buy in NYC?

 Answered by Tony Jao http://mortgage.snb.com/TonyJao/

A: While the upfront costs of purchasing a home are sometimes intimidating to first-time buyers, homeowners soon discover that buying is usually cheaper than renting.  A new RealtyTrac study has found that many New Yorkers are spending too much to rent an apartment.

According to the analysis, almost half of renters in New York live in a market where the cost of renting a one-bedroom apartment exceeds more than 30 percent of their monthly income.   (more…)

Combine those adjacent units in a Co-Op or Condo ?

annechang

Q: Do you really want to combine those adjacent units in a Co-Op or Condo ?

 Answered by Ralph Coti, Esq http://jadestonerealestate.com/nyc/ourteam/ralph-coti/

A:  Many people who own condominium units often consider whether or not to combine their unit with an adjacent unit which is going on the market.  Those owners believe that there are many practical and financial advantages which come from purchasing an adjacent unit and then combining it with an adjacent unit.  There also are many practical advantages, such as eliminating the moving hassle, continuing the current home and neighboring relationship, scarcity of large unit options on the market and etc.

The financial advantages of combining adjacent units in the same building include: (more…)

tenant is late on rent and unreachable…

annechang

Q:  my tenant has been late on her payment for over a month now and I have not been able to reach her.  I’ve emailed her, called her and left her voice messages.  Her belongings are still in the apartment.  Per my knowledge, she is back to her country and may have some visa issue.  The lease expiration date is in a few months.

Q: Can I clear out her belongings and re-rent the apartment?  what can I do?

Answered by Lucas A. Ferrara, a real-estate attorney and professor at New York Law School  http://www.nfllp.com/Attorney_Profiles/Lucas_A_Ferrara.aspx

 

A: Unless it can be shown that a tenant has unequivocally surrendered or abandoned an apartment, it is never a good idea to evict a tenant without a court order.

Speculating as to the reasons for a tenant’s absence is fraught with peril, as it is very possible that the tenant could return, at any time, seeking to be restored to the unit and/or to recover her personal belongings. (more…)

when leasing to a consulate or to a diplomat?

annechang

Q:  When leasing to a foreign country’s consulate as the lease holder, if the consulate defaults on the rent payment, will the landlord be able to evict the occupants and sue the consulate through the normal court procedure?

Answered by Lucas A. Ferrara, a real-estate attorney and professor at New York Law School  http://www.nfllp.com/Attorney_Profiles/Lucas_A_Ferrara.aspx

A:  If the leased space is a consulate or diplomatic mission, many attorneys recommend that landlords secure waivers of immunity.  But be forewarned that these waivers might not be effective, and a landlord may encounter some resistance recovering possession of its space by way of an eviction proceeding.  (According to international law, diplomatic mission space is “inviolable.” ) (more…)