2 questions: 1. Does a buyer of a co-op pay a separate mortgage to the lending bank apart from paying the?

Asked by Jackie, Danbury, CT Sat Jan 31, 2009

maintenance fee for the co-op?

2. Like in a condo or single family, once you have paid off your mortgage entirely you only pay property tax and other fee for maintenance(in condo) of the unit or house, does the same happen in a co-op? Does your monthly co-op 'maintenance' get reduced by the amount of mortgage that has been paid off.

How does this work for a co-op?

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Answers

5
Christopher…, Agent, Tarrytown, NY
Sun Feb 1, 2009
Hi, The monthly maintainence is on top of your mortgage. It does not include your mortgage payment. So that's why your loan officer will need to know that figure because it will affect your debt-to-income ratio, which in turn is an important element to passing the board process and even getting the loan.
As for the second part yes you will pay the $1200 and whatever you will owe on your mortgage. There is also a STAR reduction that you will get. Each building does it in their own way, some reduce it monthly, some shave it off of 3 months worht of maintainence, etc., Figure roughly around $100-$150 off per month.

Hope this answers your questions.

Sincerely,

Christopher Pagli
Associate Broker
Legends Realty Group
914.406.9023
0 votes
Jackie, Home Buyer, Danbury, CT
Sun Feb 1, 2009
As an example, when a listing says 'Estimated monthly maintenance' is 1200 does that estimate include my mortgage payment also or just the building maintenance and property taxes?

Assuming a property is for 250K and the buyer pays 20% down, if it is just maintenance+property tax that would mean a buyer has to pay 1200+ monthly mortgage repayment amount on a loan of 200K? Is that correct?

Thanks
0 votes
Christopher…, Agent, Tarrytown, NY
Sun Feb 1, 2009
Hi Jackie, The maintainence and your loan are separate payments, so your monthly payments need to include both figures to see what you will qualify for. Once you pay off your loan to the bank you continue to pay your maintainence and it doesn't get reduced. The monthly maintenence you are paying takes care of your pro-rata share of the buldings property taxes. You don't pay individual property taxes because you technically don't own the unit, you own shares in the corporation. The stock in the corporation is considered personal property in NY state. The rest of your maintenence will cover the underlying mortgage for the building and operating expenses. As the cost of reairs and operating can go up, so can your maintenence to help offset those costs. There are cases where the building has a very healthy reserve so not all things will result in an additional assessment.

Sincerely,

Christopher Pagli
Associate Broker
Legends Realty Group
914.406.9023
0 votes
Pascual Paul…, Agent, Bronx, NY
Sun Feb 1, 2009
Mortgage and Maintenance are two separate payments. One is to maintain the building expenses and the area. The other is to buy the property. Maintenance also includes your property taxes.
Web Reference:  http://Paulmvpteam.com
0 votes
John Vrooman, Agent, White Plains, NY
Sat Jan 31, 2009
Hi, Take a look at this...It addresses some co-op related issues... http://www.coophousing.org/buying_in.shtml . Mortgage and Maintenance payments are separate payments. When/if you pay off the mortgage...you just have to pay the maintenance charges (plus and extra charges ... special assessments, parking, etc.)
I'm not aware of any situations where your mortgage balance has any affect on your maintenance payment ... However, your maintenance charges are typically affected by the size and terms of the underlying mortgage and other financial obligations that the co-op entity (building/corporation) may maintain. If you have more questions, how about calling/emailing them into me?
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