Marc A. Landis in Board Operations on November 20, 2012
The cooperative corporation did not have sufficient reserves to reinstate or satisfy the payment obligations. The corporation did not have access to mortgage financing; nor could the shareholders afford to satisfy their financial obligations through assessments.
Legal Lesson
While this particular circumstance involves an HDFC co-op, the actions taken apply to co-ops generally: communicate, educate, negotiate and get the community and local politicians on your side. Also, more obviously, avoiding payment defaults in the first place.
This co-op board was able to address HPD's concerns and enter into a new regulatory agreement and a restructured payment agreement as a result of the following strategic actions:
Marc A. Landis is a partner at Phillips Nizer.
Photo by Jennifer Wu
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