Buyer’s GUIDE

Standard Information

In New York City’s diverse real estate market, it is crucial that homebuyers are prepared with the right documentation and information to make the process as smooth as possible. This guide details all buyers should know, from property types to fees.

Standard Information

The Budget: Location, size, amenities, building type, school locations and nearness to public transportation are crucial to determining what a property will cost. We suggest that buyers review financing options to determine what amount of money they can put toward a deposit and then determine what they can afford for a monthly mortgage payment. Some people may want to see if they prequalify for mortgage status in order to know what budget they will be working within.

Type of Property: Determining what type of property you would like to buy is an important step in the process of finding the perfect home in New York City. Whether it is a co-op, condominium, or commercial property, each property type will differ in process. Be sure to work with a SPiRALNY agent who can guide you through the process of buying any of these homes.

Apartments: When purchasing an apartment, there is no approval process, besides normal financial inquiries. Buyers have complete freedom with any renovations they wish to make. Maintenance costs are the sole responsibility an owner and with this the owner gets total control over maintenance and repairs. Transferring deeds or reselling an apartment does not require approval.

Condominiums: When buying a condominium, buyers also own a percentage of the common building areas, i.e. entrance areas, hallways and recreational areas etc. The condominium is considered real property. This means owners have the right to use the property any way they see fit. Owners are subject to pay property taxes which can either be escrowed into a part of a monthly mortgage payment or which are paid annually as an expense. Monthly maintenance fees are generally paid to the building’s condominium association.

Co-operatives: Buying a co-op is tricky, but working with a SPiRALNY agent can help. When purchasing a co-op, the purchaser is actually purchasing shares in a cooperation. The shares correspond to the units in which you live. You also must pay coop fees which include a monthly mortgage payment, as well as maintenance fees for the building. Maintenance fees are sometimes high but both mortgage payments and maintenance fees generally result in higher tax deductibles.

Estimated Fees:

  • Cooperative Apartment:
    Broker’s Fee: Typically 6%
    Buyer’s Attorney: $1700+
    Credit Report Fee: $50 – $100/applicant
    Lead Based Paint Disclosure Fee: 0 – $50
    Move-In Deposit: $500 – $1,000 (usually refundable if no damage)
    Mansion Tax: 1% of entire purchase price where price is $1,000,000 or more.

    MORTGAGE CLOSING COSTS

    NYC Mortgage Tax:
    – If mortgage < $500,000: 1.80%
    – If mortgage > $500,000+ on 1-3 family residential dwelling: 1.925%
    – Mortgage on all other property over $500,000: 2.80%
    Bank Fees: $350-$750
    Application Fee: $350
    Processing Fee: $330
    Appraisal Fee: $300-$1,500 (depending on sales price)
    Bank Attorney: $650
    Lien Search: $250-$350
    UCC-1 Filing: $100
    Recognition Agreement Fee: $200+

    ADDITIONAL REAL ESTATE EXPENSES
    – Miscellaneous Co-op Charges: Vary by building
    – Maintenance Adjustment: Pro-rated for the month of closing
    – Short Term Interest: Equal to interest for balance of month in which you close

  • Condominium/Townhouse:

    Buyer’s Attorney: $1700+
    Application Fee: $350
    Processing Fee: $330
    Credit Report Fee: $50-$100/applicant
    Lead Paint Based Disclosure Fee: $0-$50
    Move-in Deposit: $500-$1,000 (usually refundable if no damage)
    Mansion Tax (if prices over $1 million): 1% of purchase price
    Real Estate Tax Escrow: 2 to 6 months
    Recording Fees: $250-$750
    Municipal Search: $350-$500
    Fee Title Insurance: approximately 0.5% of purchase price

    MORTGAGE ASSOCIATED FEES (If Applicable)
    Origination, Points: 0-3% of loan
    Application, Credit Check: $500+
    Appraisal Fee: $300-$1,500 (depending on sales price)
    Bank Fee: $750
    Bank Attorney: $650
    Mortgage Tax: 0.8%
    Mortgage Title Insurance: Approx. $130 per $100,000
    Of Mortgage amount NYC Mortgage Tax:
    -If mortgage <$500,000: 1.80%
    -If Mortgage >$500,000+ on 1-3 family residential dwelling: 1.925%
    -Mortgage on all other property over $500,000.00: 2.80%

    ADDITIONAL REAL ESTATE EXPENSES
    – Common Charge Adjustment: Pro-rated for the month of closing
    – Real Estate Tax Adjustment: Pro-rated depending on when the tax is collected
    – Miscellaneous Condominium Charges: Vary by building
    – Short Term Interest: Equal to interest for balance of month in which you close

    NEW DEVELOPMENT DIRECT PURCHASES FROM SPONSOR
    For new development condominiums, the purchaser generally pays the NY and NYC
    Transfer Taxes normally paid by the Seller.