Author: Daniel O'Hara

There are times when a New York co-op board or a condo association may want or need to get into a unit….but when? General examples include when there is consent of the occupant, when there is a court order, or when there is an emergency. 

An initial step to gain access is to check the exact language of the governing documents for the property, which may consist of the house rules for the condo or co-op offering plan, or the bylaws of the property, or the proprietary lease of the co-op. For most offering plans, the co-op board may enter for reasons that support appropriate purposes, such as notice for repairs. Additionally, the proprietary leases may allow property managers the right to demand entrance to randomly selected co-op apartments to ensure that residents are following the rules.

Consent

New York law is based on a standard using “reasonableness,” which means that if the co-op gives reasonable notice, the shareholder is required to give access. Reasonable could mean the notice can be 24 hours for an inspection or a week’s notice for a repair issue. Typically, the specifics are found in the bylaws and often they refer to notice for repairs, but it can be for other reasons as well.   

Getting Access Via a Court Order

Sometimes you need to gain access for something other than a repair issue. For example, suppose your co-op receives complaints about odors and infestations coming from a shareholder’s unit, which seems to be cluttered. This could be indicators of hoarding, which is a threat to not only the shareholder, but also to the other building residents because it can create a fire hazard and can help attract pests to the building.    

If you’re in this type of situation, you usually can start with letters and notices to the shareholder so that you can gain access. However, the shareholder might ignore this and after time, you may have to compel access through the court system, which involves getting a court order.   

Emergency

Another time that the board or association may gain access is when there’s an emergency. However, it’s not always obvious, and there is an issue as to what’s considered an “emergency.” You may search the bylaws and not be satisfied with what they say. That’s why it’s important for entities to take the time to clean up any broad language before these incidents happen. 

Some boards or management companies have used so-called emergencies as a sneaky way to enter a unit for other, less exigent reasons. A good way to gauge this is to ask whether the scenario has already existed for a significant length of time. If it’s been weeks, or even months, it’s likely not an emergency. If there is truly an emergency, you would get a government entity involved, such as the police or fire department. This demonstrates that something is currently amiss. And you’re being reasonable and responsible, and this will likely shield everyone from harm, including protection from any legal liability that could occur.    

Speak with an Experienced NY Real Estate Attorney About Co-OP Access 

Typically, you won’t have problems accessing a shareholder’s apartment. However, there are times when the co-op board might have to solve the problem through major action such as an eviction. An attorney can assist you with terminating their lease and removing the tenant if it comes to that. You should speak to one of our MOWK Law attorneys about your options. Contact us right away to learn more.

If you’re ready to take the important step of making a major commercial real estate purchase, you’ve got to figure out the best way to make it happen. While loans for residential real estate are generally assigned to an individual borrower, a commercial loan is generally placed with a business entity. With transactions of this kind, certain legal issues need to be resolved to set up for a successful result. Read on to learn about information about how to finance your New York commercial real estate purchase. 

What are Commercial Property Loans?

The commercial property loan agreement is basically just a contract between the borrower and the lender. While that may seem simple, the loan terms can actually be complicated with the documentation consisting of various clauses with complex language.   

There are various alternatives, but typically the loans can be broken into a few key categories. The first concerns the type of lender.  

Conventional Bank Loans

Most commercial real estate loans are made by traditional banks. Things to know:

• Usually requires a strong credit history
• Offer competitive interest rates
• Likely requires at least 20 percent down
• Doesn’t require the property to be owner-occupied
• A penalty may be charged if the loan is paid off early

Small Business Administration (SBA) Loans

The federal and state governments have programs for eligible borrowers who can’t meet standard commercial loan requirements. The U.S. Small Business Administration (SBA) offers some of the least expensive loans for investing in commercial real estate. Things to know:

• Assists the commercial borrower through increasing their creditability and 
• Makes borrower more favorable by guaranteeing the loan 
• Reduces risks for the lender

Hard Money Loans (aka Bridge Loans)

These are short-term loans with high interest rates and are based on the perceived value of the real estate and not the borrower’s credit history. They are usually short term (for example, for a year or less) and are used temporarily while an investor works to secure a longer-term bank loan.  

Other Types of Loans

Here are some other solutions to commercial real estate financing

• Commercial Mortgage-Backed Securities (CMBS): These loans (aka conduit loan) are commercial real estate loans secured by a first mortgage on a commercial property. 

• Acquisition and Development Loans: This type of loan covers the cost of acquiring the land and the expenses associated with developing it, in addition to interest and sales commissions.  

• Mezzanine Financing: These loans can be used to provide additional money that helps a developer complete a project where a short-term loan is provided to a developer in return for a partial interest in the company as collateral. 

• Construction Loans: A straight forward loan for the financing of construction on a commercial property.

Help for Financing your NY Commercial Real Estate

There are many financing options available for your New York commercial property. You can navigate the complexity of this type of transaction with the helping hand of an attorney familiar with real estate, finance, and securities law. Our experienced MOWK Law lawyers can give you guidance as to your best bets, given your situation. Contact us today for more insight.

You can always expect the unexpected when it comes to the NY co-op landscape. There are constant changes to the laws, so it’s important for co-op board of directors to be up to date with the evolving environment. A recent significant shift deals with reverse mortgages. Up until recently, reverse mortgages were only available to owners of one to four family homes and condominium apartments. However, the law in New York for reverse mortgages has changed to include owners of shares in a co-op. 

What is a Reverse Mortgage?

Before diving into the way that this affects co-op boards, let’s review the specifics of reverse mortgages. Unlike a traditional mortgage, no payments are due for the reverse mortgage until the end of the mortgage term or until the property is sold or until the borrower is deceased. 

The property owner is able to use their real estate interest as collateral for the loan. Prior to the recent legal changes, shareholders in co-ops weren’t allowed to take out reverse mortgages because they weren’t considered as true legal owners of the property by deed. Since they didn’t own a real property interest that could be considered as collateral for the loan, they were ineligible. Now that the law has changed, residents can use their shares or membership interest in a co-op for security for reverse mortgages. 

How it Works 

In addition to some other basic rules, including parameters about maturity events and circumstances for foreclosure defenses, there are key differences between a co-op reverse mortgage and a traditional reverse mortgage:

• Here, the reverse mortgage is secured by either shares or membership in the cooperative unit.
• The minimum age of the tenant who gets the reverse mortgage secured by the co-op apartment is 62, compared to 60 for real property ownership.  
• The co-op unit must be the shareholder’s primary residence. 
• If a reverse mortgage is secured by a co-op apartment, the resident must get it approved by the co-op’s board of directors. 

Co-op Board Approval

Just because the board of directors’ approval is necessary for a resident to secure a co-op reverse mortgage doesn’t mean that the board should necessarily honor the request. While the co-op has priority lien for the monthly maintenance, co-op boards still need to really think about granting permission for a shareholder to obtain a reverse mortgage. 

Cautious contemplation is critical, especially if the shareholder can’t afford the monthly maintenance for the apartment without the loan proceeds. For instance, suppose the shareholder does indeed blow the loan proceeds and isn’t able to pay the monthly maintenance. Then the co-op is in a tough scenario of having to foreclose on a senior who has little or no equity in their unit and probably has limited options for their living situation. 

Ask an Attorney About Reverse Mortgages

The changes in the law that allow co-op shareholders to obtain reverse mortgages may be considered a cause for celebration. However, it’s important for boards to weigh the possible risks of any request. You can discuss this with a lawyer before going forward. Feel free to contact us at MOWK Law to have your questions addressed by an experienced attorney.

If you’re involved in a home purchase, then you might find yourself coming across with a “time is of the essence” provision. You might have heard of this term before but weren’t sure what to make of it. What exactly, is time of the essence and why is it important in your New York real estate contract?

Definition of Time of the Essence

The term “time of the essence” is a legal term of art that is used to state the timeline in which one party must complete their contractual duties. Completing the time is not only a priority but also a necessary part of the completion. If they fail to meet the deadlines agreed to with regard to “time of the essence,” it is considered a breach of the contract. 

Time of the Essence Letters

While this provision can be used in various types of contracts, it is very common in real estate transactions. In this context, it is sometimes applied in a time of the essence letter, instead of explicitly stated in the contract. 

For the court to view the time of the essence letter as valid, it should include the following:

• A reasonable timeline
• Clear conditions
• Information about the consequences if the party doesn’t meet the stated timeline

What Types of Acts Can Be Subject to “Time of the Essence” Deadlines?

Basically, anything that should be completed within a given amount of time in a real estate transaction is ripe for a “time of the essence” provision. For example, this can include notices, document delivery, termination procedures, and the closing date of the transaction. A real estate agreement should include specific completion dates for the tasks that have time contingencies.

What Happens if Time of the Essence Deadlines are Not Met?

If there is a “time is of the essence” clause in the contract, there are consequences for the failure to meet the timeline. For instance, suppose the contract requires you to provide an inspection report in 5 days. If you don’t provide the report to the other party within the 5 days, you would be subject to the consequences, such as facing potential termination of the contract.   

Time is of the Essence Principles 

While the details will differ for each contract, there are certain conditions that should be present: 

• All parties must be aware of its existence: If any party is unaware of their obligations, then it will not be enforceable; everyone involved in the transaction needs to know the deadlines and the consequences of missing them.
• All parties may request a reasonable postponement of closing day: The parties are entitled to ask to postpone the closing day. However, it must be reasonable, and the other party must agree. 
• Amendments are available: If someone breaches, it is still possible to remedy by amending the original clause. If both parties don’t agree to amend the breached provision, the missed time frame can end with major consequences.

Let an Attorney Help with Your “Time is of the Essence” Real Estate Transactions

The purpose of a “time of the essence” clause is to maintain accountability during the real estate transaction. If you want to include this in your agreement, you can work with an experienced MOWK Law real estate attorney. When the deadlines and consequences are determined, both buyer and seller can advance to a satisfying closing day. Contact us today to get started.

Fair housing laws at both the federal and state level have existed for decades to protect disabled tenants from discrimination and harassment. For instance, the law provides safeguards, such as the right to have emotional support animals, even for buildings that have a no-pet or no-animal policy. Additionally, besides providing things like support animals in private housing, these state and federal laws apply in the condominium context and oblige condo associations to make reasonable accommodations and/or modifications for persons with disabilities. These requirements serve to allow everyone the opportunity to use and enjoy their property.

Conscientious condominium boards do their best to navigate this complex area of law, but it can be difficult to follow. You want to keep track of what the law requires, who is responsible for the accommodation and modification costs, and how to stay in compliance with the law. Read on to learn how to avoid violating the reasonable accommodations laws.   

Notice Requirements

Under New York law, cooperatives and landlords of residential building are required to provide written notice to tenants of their right to request reasonable accommodations or modifications if they have a disability. The law also requires “conspicuous posting of the notice.” For any new tenant, they must be provided with the written notice within 30 days from the beginning of their tenancy.

Reasonable Accommodations

Everyone must have an equal opportunity to enjoy and use their property, regardless of disability status.  If a condominium association refuses to make reasonable accommodations or modifications, then it’s considered discrimination; this includes both private units and public and common use areas. This means that they must make changes to policies and buildings if a disabled tenant makes a request. 

To determine whether an accommodation is actually reasonable involves a close analysis of the specifics of the case. Generally, the tenant or unit owner is not responsible for the cost of making the accommodation or modification. And it will be something that you have to take in consideration. 

Although the cost of an accommodation is one of the factors, it alone is not enough to make an accommodation unreasonable. There has to be a discernable connection between the request and the individual’s disability.   

Examples of Reasonable Accommodations/Modifications in New York

Examples of reasonable accommodations or modification can include the following:

• Requests for emotional support animals
• Requests for more disabled parking places
• Requests for wheelchair ramps
• Requests for automatic doors

Discuss How to Comply with Reasonable Accommodations Law with an Attorney

Now that you know what the laws are, you might think that you’re completely in compliance with them. However, there may be a lot of errors on your part. Don’t take this for granted. Get the insight from an experienced attorney on your side, so that you know what to do. Contact one of our MOWK Law attorneys today.