Chapter 15: Condominiums & Cooperatives

Question 1

A dwelling unit owned by a corporation in which an owner owns stock commensurate with the value of his or her apartment compared to the value of the building as a whole. The stockholder has a proprietary lease to the apartment.

Answer 1

Cooperative

Question 2

A loan in which shares of stock are used as collateral. Typically found in cooperative purchases.

Answer 2

Share Loan

Question 3

A lease given by a corporation to another. It is often used in a co-op context, where the owner is given a certain number of shares in the co-op, along with a proprietary lease for one of the residences in the building.

Answer 3

Proprietary Lease

Question 4

Monthly payments by a shareholder to a cooperative corporation.

Answer 4

Maintenance

Question 5

The developer or owner organizing and offering for sale a condominium or cooperative development.

Answer 5

Sponsor

Question 6

A series of documents submitted for the review by a cooperative board.

Answer 6

Board Package

Question 7

Describes the terms under which the cooperative gives permission to a shareholder before making any changes or improvements to the unit the shareholder occupies.

Answer 7

Alteration Agreement

Question 8

A form of fee simple ownership of part of a structure having multiple units. Owners have title to their own units plus a share of the common elements.

Answer 8

Condominium

Question 9

A residential establishment that includes both a condominium and cooperative ownership structures. Typically the condop refers to the residential portion of a building which is treated as a single condominium unit owned through a cooperative-ownership structure.

Answer 9

Condop

Question 10

The owner’s rights and obligations for a condominium.

Answer 10

By-Laws

Question 11

Also known as Common Areas; refers to the spaces in a building shared by residents of the building. Common areas include lobbies, corridors, stairs, elevators, etc.

Answer 11

Common Elements

Question 12

Limitations and rules on a group of homes by a builder, developer, neighborhood association and/or homeowner associations; when living in a building, a buyer gives up certain freedoms to be part of a shared community.

Answer 12

Covenants, Conditions and Restrictions (CCRs)

Question 13

Also known as a Master Deed, is a fundamental document that establishes the existence of and further governs the use and maintenance of a condominium property.

Answer 13

Declaration

Question 14

Rules in a cooperative that cover common issues including garbage disposal, maintenance, noise, and conflict resolution.

Answer 14

House Rules

Question 15

Generally an agreement to agree. It outlines the terms between parties who have not formalized an agreement into a contract. LOIs are generally not binding and unenforceable.

Answer 15

Letter of Intent (LOI)

Question 16

A document prepared by the attorneys representing the builders of a newly constructed condominium building. The statement includes information about the number and type of units in the building, the Homeowners Association rights and duties to owners, and a list of any easements or liens affecting the title of the building. In most cases, buyers looking to purchase a new construction condo get the Offering Statement from their agent before they make an offer on a unit.

Answer 16

Offering Statement

Question 17

The agreement between the cooperative building and the bank lending money for purchase of shares of stock in the cooperative.

Answer 17

Recognition Agreement

Question 18

A fee paid by a seller or buyer on a housing co-op transaction typically in New York City. It is not a tax, and not deductible as a property tax. It is a transfer fee payable upon the sale of an apartment to the co-op.

Answer 18

Flip Tax

Question 19

A term used for buying a home and then turning around and reselling it for a profit.

Answer 19

Flipping