Best answer: What does it mean to co op with a Realtor?

“Broker-Co-op” is a real estate lingo states that one broker will co operate with other broker by paying a fee if and when selling broker procures (brings) a buyer to purchase the listed property(es). The term does not apply to buyers directly.

What does co-op with a realtor mean?

While each of these sellers was willing to co-op with a real estate agent, “co-op” can be a confusing term to those not in the real estate business each and every day. Simply put, it means to cooperate – you are willing to work with a realtor and pay a buyers’ agent’s commission.

What is a co-op when selling a house?

A co-op, which is short for a housing cooperative (or cooperative housing), is a type of real estate that is significantly different from owning a condo or renting an apartment. In a co-op, residents don’t actually own their housing units or any real property for that matter.

What is the benefit of a co-op housing?

In some cases, co-ops offer a less expensive housing option. They are usually cheaper, per square foot than condos in the same area, with the added benefit of lower closing costs. A future sale of a unit can result in significant financial gains, even though owners aren’t building equity.

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What are the pros and cons of a co-op?

Pros & Cons

  • The main advantage of purchasing a co-op is that they are often cheaper to buy than a condo.
  • Co-ops are typically more financially stable.
  • The instance of foreclosure is rare.
  • Co-ops are typically going to be a higher owner occupancy rate.
  • You can typically get better square footage for your money.

What happens when you pay off your co-op?

When you pay off the cooperative loan, the bank will return the original stock and lease to you and will also forward a “UCC-3 Termination Statement” that must be filed in order to terminate the bank’s security interest in your cooperative shares.

Why are co-ops bad?

Co-op fees tend to be higher than condo fees because co-ops roll all the monthly expenses into one bill, including gas, water and property tax. For example, if a co-op shareholder owns 2 percent of the property, they will pay 2 percent of the electric bill.

Is it difficult to sell a co-op?

Co-ops are governed by stricter rules than are condominiums. … Buyers are subject to intense financial scrutiny when applying to buy into a co-op, making it more difficult to both buy and sell co-op shares, since a seller may invest time and resources to find a buyer, only to have the buyer rejected by the co-op board.

What happens when you sell a co-op?

When you move, you sell your stock in the co-op. In some co-ops, you may have to sell it back to the corporation at the original purchase price, with all the stockholders sharing collectively in whatever profit is made when the shares (unit) are resold. In others, you get to keep the profits.

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How does a co-op building work?

Cooperative housing is where you buy in to become a part-owner of that entire piece of property. “When you buy into a co-op, you become a shareholder in a corporation that owns the property. … Rather than owning a single unit, you become a part-owner of the whole building.

What are the disadvantages of a coop?

The disadvantages of a cooperative society have been defined below:

  • Limited Resources: …
  • Incapable Management: …
  • Lack of Motivation: …
  • Rigid Business Practices: …
  • Limited Consideration: …
  • High Interest Rate: …
  • Lack of Secrecy: …
  • Undue Government Intervention:

What do I need to know before buying a coop?

8 Things To Consider When Buying a Co-op

  • #1: Seek help of a NYC broker.
  • #2: Do not overestimate your financial strength.
  • #3: Get informed about the co-op board.
  • #4: Prepare for the interview with the co-op board.
  • #5: Ensure the co-op is on your mortgage provider’s approved list.
  • #6: Check if there is a lien against the unit.

Can a coop be inherited?

When you inherit a co-op apartment, you are inheriting shares in a corporation that owns real property. You can sell those shares from the estate, or you can keep them. However, in order to be allowed to live in the apartment, the Board of Directors of the cooperative corporation must approve you.

How do co-ops handle maintenance issues?

The mutual obligations between shareholders and the co-op are governed by the co-op’s proprietary lease, house rules and by-laws. … If the co-op makes repairs for which the shareholder is responsible, the co-op is entitled, under most proprietary leases, to charge the shareholder for the cost of those repairs.

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Is buying a coop a good idea?

With double digit annual property value gains like that, it comes to no surprise that coops have made an excellent investment for those that have bought into them and continue to be a great opportunity for those looking to enter the market. For more Manhattan real estate market insights, read the Elliman Report.

Is buying a coop a bad idea?

Buying a co-op may place limits on how much home equity you can accumulate or if you can accumulate equity at all. While market-rate co-ops accumulate equity much like single-family homes, limited- and zero-equity co-ops restrict your ability to profit if and when you sell your shares.