The most frequently asked questions about Cooperative Ownership
Q. What is Cooperative Homeownership?
A. Co-op ownership is where individuals buy shares in or membership into a corporation, rather than acquiring real property (synonymous with a deed). For tax purposes, in cooperative ownership, the corporation owns the building and there is only one deed for the entire building.
Q. Is there Real Estate Transfer Tax?
A. Cooperative sales are not subject to the local transfer and recordation taxes on the sale of real property.
Q. Can units be purchased by a corporation or trust?
A. Co-ops must be purchased by individuals, and cannot be bought by a corporation or trust. Anonymity in a cooperative, therefore, is not possible.
Q. Can Interest be deducted?
A. One of the great benefits of home ownership is the same – the deductibility of interest on borrowed money.
Q. What contracts are there between owners and the cooperative?
A. Members/owners in the WPH Cooperative have exclusive rights to their particular unit through an occupancy agreement/proprietary lease with the cooperative corporation – often referred to as the cooperative ownership contract. With this contract, the owner agrees to comply with the cooperative’s bylaws and to pay a monthly fee toward the operation and maintenance of the building along with the shareholder’s pro-rated share of the real estate taxes.
Q. Is there an approval process for WPH?
A. The WPH cooperative board of directors reserves the right to approve prospective purchasers for membership/ownership. The board review process is designed to review the purchaser’s application package including financial information.
Q. What is included in the monthly fee?
A. The monthly fee includes almost everything: All utilities including electric, heat, air conditioning, water, a great channel line up, building insurance, all real estate taxes, and maintenance package.
Q. Is there a WPH Co-op board?
A. Co-ops elect a board of directors who oversee operations and annual budgeting. This board manages the affairs of the corporation and handles actual day-to-day management.
Q. Is there approval needed by the board for financing?
A. The co-op board has the right to determine approved financing including required minimum down payments and minimum cash requirements. This can be done to determine if someone has the ability to assume an existing underlying or blanket mortgage or other assessment changes in the future.
Q. Does WPH have to be my primary residence?
A. No, WPH does not have to be your primary residence and can be used as a weekend residence.
Q. Who is the board governed by?
A. Co-op boards are governed by local Fair Housing regulations.
Q. Are pets allowed?
A. WPH does not permit any pets in the building.
Q. What are the closing costs?
A. Since purchasing a cooperative is a stock or membership transaction, the transfer and recordation taxes assessed in many jurisdictions on real estate sales do not apply. Further, title searches are handled through a less expensive Uniform Commercial Code (UCC) search.
Q. Can units be rented out?
A. WPH only has owner occupied units & units may not be rented to anyone.
Q. Are there tax deductions?
A. Like traditional financing, interest on share loans, the portion of the monthly co-op maintenance fee attributed to real estate taxes, and certain closing expenses may be tax deductible.
Q. How often does WPH have assessments?
A. WPH has never had an assessment, ever!
Q. What is the administrative fee for, when is it paid, and can it be financed?
A. The WPH Administrative fee goes towards the reserves of the building for capital improvements. This Administrative fee is paid at time of purchase. We do not believe the Administrative fee can be part of an equity mortgage, but this would be determined by your lender and the type of financing received.
Q. How thick is the concrete between floors?
A. The floors are concrete slabs around 6 inches thick.
Q. How are main improvements handled?
A. Cooperatives have the ability to borrow funds for repairs and capital improvements. A debt of the cooperative is often referred to as an underlying or blanket mortgage. An underlying mortgage may also exist from the time the cooperative purchased the land and building. The interest paid on each cooperative members’ pro rata share of the corporation’s mortgage may be tax deductible.
Q. How much is the pool and fitness center?
A. The Fitness Center is $60 per year, per person. The pool is $100 per year, per person. The pool is open from Memorial Day to Labor day between 10 am and 9 pm
Q. Can Recessed lighting be put in the ceilings?
A. No, the ceilings are cement and cannot accommodate recessed lighting except on the 29th floor.
Q. What is the breakdown of units in the building?
A. There are 536 units at WPH. The breakdown is as follows: 94 efficiencies, 148 one bed one bath units, 118 two bed one bath units, 100 two bedroom and two bath units, 18 three bedroom units, and 58 combo units.
Q. How much is parking?
A. Each unit may valet park 2 cars at $80 per month each.
Q. Can dryers be vented outside?
A. No, dryers can not be vented to the outside of the building.
Q. How are appliances handled?
A. WPH owns all appliances in building. This includes, Refrigerators, Washers, Dryers, Dishwashers and heating and air conditioning units. WPH will maintain these appliances and replace them as required.
Q. Can owners upgrade appliances?
A. Appliances may be upgraded when they are first being ordered by the building. The owner may pay the difference between the allowance and the upgraded model. The building owns all appliances at time of sale. If “State of the Art” appliances are purchased, then the owner will be responsible for maintaining these appliances.
Q. Can units be upgraded?
A. Units can be completely upgraded by owners. There are no bearing walls in the WPH. All renovations must be approved by WPH.
Q. Are taxes prorated when a unit is purchased?
A. Yes, taxes are prorated at time of purchase.
Q. Do owners receive a breakdown of the monthly fee?
A. Yes, all WPH owners receive a statement of a breakdown of the monthly fee annually when the building is audited.
Q. What type of insurance is required?
A. Owners request a HO6 policy from their own insurance carrier. WPH also requires each owner to carry $500,000 of Personal Liability Insurance
Q. Can residents control the heat and air conditioning?
A. Yes, it can be controlled individually.
Q. Is there storage available?
A. No, there is no storage available.
Q. Is there an area for bicycles?
A. There is a bicycle room with limited space and the cost is $50/ year.
Q. What amount do most lenders require as a down payment at WPH?
A. Currently, most lenders require that borrowers put at least 20% of the purchase price down.
Q. Which banks will lend at WPH?