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Our coop has a one year sublet rule with second year special consideration and they have increasing fees for each year. However, some shareholders who have to move out of their own apt for severl months - due to renovation or fixing damages - have been subletting without paying any fee - most of them in one apt of a guy who lives out of state. It has gone way ove the one year limit. Is this irregular? It seems unfair.
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The BOD in our building accepts any and every explanation that a shareholder gives, so we have many illegal sublets. How do you suggest that we require that the BOD enforce our sublet policy, which states that a shareholder can sublet for two years with 10% of the maintenance paid to the corp. as a sublet fee,
The BOD likes to call the illegal sublets, roommates, even though the shareholder is absent. This is a fair and easy way to raise funds, but the BOD would rather raise the maintenance and cost of amenities while allowing illegal subletting. The president of the Board insists that we cannot prove that the shareholder illegally sublets their apartment
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This sounds so familiar, the same is happening in my building. The president of our BOD who always claims fiduciary responsibility and liability, has a signed contract on her apartment and is selling, yet makes decisions on finances and does nothing about illegal sublets. We have illegal sublets for years without any fee. Certain members consistently say it cannot be proved. Yet the shareholder is not living in said apartment. They seem to circumvent our offering plan and by-laws to their advantage. I've spoken to attorney's and was told that the burden of proof is on the shareholder, but certain members of our board insists that the burden is with the co-op. Can anyone shed light on this?
These are short-term sublets in the same apt - over and over - to current shareholders who are renovating . Not sublets to outsiders. They - nor the owner of the apt - pay the usual fee to the coop - is this a bad idea?
Tammy, yes, it's a bad idea without a fee. Even though they are are shareholders, they are not shareholders of the unit in which they are currently living. They are sublets and should be paying the sublet fee.
i had read that to qualify for a roommate status in a coop, the shareholder must be living in the apartment with the roommate.
Similar to the "and" "or" wording in paragraph 14 of the proprietary lease concerning right to occupy.
I have been battling the same issue in this co-op, many of the coops have been occupied by the adult sons or daughters of the new shareholders, plus the prospective shareholder who attended the interview , stated that they were going to occupy the apartment and never mentioned the child, and the apartments were studio or 1 bedrooms.
I had asked this question in the NY times, disguising non-owner occupied apartments as owner occupied for better sale prices, meeting mortgage requirements for banks. The answer was, it is mortgage fraud and to contact your local mortgage fraud unit, in my case the DA
Efy, thanks for the mortgage fraud information. I think my building must go that route as we are out of options and do not have the support of the board. They cover it up.
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Hi,
For my co-op, the issue is about giving the shareholders flexibility while keeping an eye on owner-occupancy. Any sublet decreases owner occupancy and we charge for all. We had a 2 year policy and extended it for a temporary 3rd year when the market tanked. We throttled back to 2 years this year when we learned about the stringent owner occupancy requirements on shareholder mortgages approval that Fannie and Freddy were imposing. We may have to throttle back even one year. My suggestion is to enforce the fee as a deterrent and to explain why (Fannie/Freddy and owner occupancy).
Good luck!
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