CREATIVE REFINANCING: THREE BOARDS BEAT THE ODDS TO FIND THE PERFECT MORTGAGE

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THE "5-5-5-5-5" MORTGAGE

99-15 66th Avenue, Rego Park, Queens, 53 units

NEED Among the issues: Local Law 11 work, new security cameras, a new roof, a new boiler, new fencing around the front, new front doors, and the underlying financing coming due.

AMOUNT RAISED AND LOAN DETAILS The building's mortgage was $678,000, which had been a seven-year loan at 5 ¾ percent. The new 30-year mortgage will roll over every five years.

LENDER AND/OR MORTGAGE BROKER Flushing Savings Bank

The so-called "5-5-5-5-5 plan" gave the board more flexibility than a traditional 30-year loan. Every five years, the rate adjusts and the board has the option to get out of the deal with no penalty. The co-op hit on the idea in an unusual way. "I was getting tired of every five to seven years refinancing and spending $50,000 in expenses," recalls Isaac Fuchs, the board president. "I'm in the limousine business. One of the people that I drive once in a while does mortgages in the city. And I was talking to him and told him, ‘I am tired of spending $50,000 every few years, throwing it out the window to refinance. Everyone gets their cut and the building pays for it.' He told me that we could get a 30-year mortgage. Flushing had the ‘5-5-5-5-5 plan,' which seemed to make sense, especially with today's low interest rates."

Photographs by Jennifer Wu

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