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I have seen a lot of recent co-op apartment sales listed recently as "no guarantors or parents buying for children".
What are the board positions/arguments/justification in these cases?
AdC is, as usual, right on target.
Here are some of the reasons boards ask for the things AdC suggests.
* Usually the children are in their 20's, often just a year or two out of college. Many are reliable, honest and mature adults. Some, however, are not, and believe that their apartment can be treated as a dorm or a rental unit with an absentee landlord -- who happens to be Mommy & Daddy.
* Some of them believe that paying the maintenance is optional. Or they say that it's their parents' responsibility (even if it isn't).
* They may decide to have friends stay the summer while they're out of town; you & I consider that subletting, which requires an application, a fee, maybe an interview; the young person who lives there may think he/she is just being helpful to a friend in need anda that the board should butt out.
* The child may not be prepared to understand the importance of following the rules of communal living.
* Some may have roommates who change every year.
Again, some children are wonderful subtennants; our building has wonderful examples of young people who live in apartments their parents bought for them. Part of the reason is that they are responsible people. But another part is because parents and child attended the board interview, and because parents and child filled out purchase applications.
Steve
What is becoming more popular though is the ability to purchase under a Corporation or a Living Trust, which somewhat negates the whole guarantors or parents thing because the children are named as beneficiary of the Trust.
I do not care for this much because it is harder to sue the Trust than it is a physical shareholder.
~AR
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Or guarantors???
Again... there are many ways to help children. Even when we are grown up children, we never get old for our parents!. We used to buy brand new cars to children; why not an apartment or our house now while alive?
But, what is the maturity of the occupant and the ability to pay that is important in your case.
Position:
(1) The child has to appear with the parent as co-shareholder if you have a sublet policy in place with occupancy limits before being able to sublet.
(2) Your child and parents must comply with financial and references. Everyone that would live in the unit must be interviewed by the admissions committee.
(3) Why is the parent buying for a child? To attend the university, to provide the first home for a child as the child is trying to start a career in NYC or suburb?
(4) Any roommates from the onset must be interviwed for rules and character references must be provided.
AdC
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