Purchasing a co-op in New York City can be a real odyssey. Even with thousands  of options on the market, securing a place that fits your lifestyle and budget  can leave you with only a handful of viable choices. Factor in each building’s financial requirements and you may be down to just two or three co-ops that  you qualify for. And then there’s the interview with the board, a nerve-wracking process even for the most well  qualified applicant. But even after the stress and paperwork, many applicants  don't make it past the finish line. For a successful admission process for both  boards and applicants, there are several legal and practical matters that both  parties should keep in mind.  

 Who is the Best Applicant?

 Like every business, each co-op board is different, and this individuality  pertains to the admission process as well. When prospective buyers are looking  into purchasing a co-op, they typically complete a board package that is a  complete picture of their financial history. Boards want to see financially  stable individuals who will be able to cover maintenance fees, mortgage  payments and closing costs, while still having reserves. “The one color you can discriminate is green, which is credit,” says attorney Neil Garfinkel of the law firm of Abrams Garfinkel Margolis  Bergson LLP in Manhattan. “Boards want to see where your income is coming from.”  

 In order to make decisions about an applicant’s finances, boards will typically ask for two years of signed income tax returns  and W2 forms, bank statements, and your last three pay stubs. Many boards also  want applicants to include letters of reference from both personal and business  sources. They may even include a questionnaire. A licensed broker can help  applicants assemble the package, ensuring that they include all required  paperwork and turn it in before deadline.  

 Besides finances and personality, boards are limited in their criteria used to  accept or reject applicants. Garfinkel says that the board cannot discriminate  based on the protected categories of age, citizenship, color, familial status,  handicap, marital or partnership status, race, occupation, religion, sex and  source of income. He adds that New York City has the most protected classes,  compared to the state and even the Fair Housing Act of 1968, which is federal  law.  

 The Interview

 If after reviewing the board package the board feels like the applicant meets  their financial and lifestyle criteria, they will invite them over for an  interview. For many applicants, this is the most stressful part of the process.  The board has the power to ask the applicant more questions relating to their  finances or lifestyle, but cannot ask any questions relating to the protected  categories, says Frederick Peters, a licensed broker and president of Warburg  Realty in Manhattan. For example, many boards may ask why your income has  dropped, or if you are planning on doing renovations in the future. Depending  on the co-op and the board, the interview can be short and succinct or lengthy  and thorough almost to the point of feeling intrusive.  

 On several occasions, boards have asked that other family members attend the  interview to see how everybody interacts with each other. If the co-op allows  pets, your furry friends may be invited as well to see how they interact with  the other canines or felines in the building. Once again, there is no limit to  what the board can do or ask as long as it does not overstep any legal  boundaries. Many boards want a clear picture of who they will be living next  door to for the next couple years.  

 Really, being invited for an interview means the worst part is over: you meet  the criteria but the board just wants to see how you will fit in with your  future neighbors. Garfinkel advises applicants to just be themselves. You don’t want to pretend to be someone you are not- more likely than not, the board  will be able to sniff it out anyway.  

 Thumbs Up or Down

 After meeting with an applicant, the board will make a decision. “Boards can take from a few days to a couple weeks when deciding on an applicant,” says Garfinkel. “Also in New York City, the board does not have to give a reason as to why they  did not approve an applicant.”  

 There may be a few possible reasons why boards decide to turn down an applicant.  They may not feel like he or she fits in with the building or believe their  personality or lifestyle is not compatible says Peters. Importantly, they  cannot reject an applicant based on the protected classes for example, deny a  couple because they two college-aged children in a primarily older community.  If the board believes that the college-aged children will be having potentially  disruptive parties, however, they may take a pass on the applicant.  

 Many famous personalities including Madonna, Barbara Walters, Richard Nixon,  Calvin Klein and Mariah Carey—have been rejected from co-ops in the city. Again, this was probably a  lifestyle-based decision. Most co-ops don’t want to have paparazzi-provoking neighbors or stars with disruptive  lifestyles, which potentially explains why stars who clearly pass the financial  criteria are denied admission into the building.  

 Peters adds, “Increasingly boards actually check references, and sometimes the calls they make  reveal traits which the board may believe make the applicant unsuitable for  their community.”  

 Recently, applicants who have made offers that are too low are being turned down  by the board says an October 2012 article in The New York Times. The article explains that “interviews with more than a dozen Manhattan real estate experts, including  brokers, board members and real estate lawyers, suggest that boards are saying  no more often as they seek to maintain the value of the apartments in their  buildings amid a sea of price-conscious buyers.” Not maintaining a certain price range on apartments can negatively affect the  values of other units.  

 Pinning down the exact reason for board rejection is difficult because the board is not required to provide an  explanation and is protected in court by the business judgment rule. Both  Peters and Garfinkel say that a board can reject an applicant for almost any  reason, as long as they do not discriminate illegally.  

 Tips For Boards and Applicants

 While applicants can’t sway the board too much, they do have some power over their presentation. In  order to make a good impression, Peters suggests that buyers “keep their demeanor and questions neutral. We tell our buyers, no one has ever  been turned down for being boring.” This advice may seem counter-intuitive to those wanting to project a reflection  of true self but it doesn’t mean that you don’t have to be yourself, just remember to be professional. Industry experts tell  buyers that boards are looking for a mentally and financially stable new  neighbor, not a class clown or know it all. The co-op admission process is  similar to a job interview-it’s best to err on the side of professionalism, especially when you don’t know how the board will respond to your political jokes or social commentary.  

 Professionalism should be reflected in dress too. “You can’t overdress, if you were sitting on the other side, what would you expect? At  the very least you should dress business casual,” says Garfinkel. Generally no need to wear a tux or even a suit he says but  dress slacks or skirts, a nice shirt or blouse can help show the board that you  are serious about getting in.  

 Completing the board package as required may seem obvious but there have been  dozens of candidates who forget to attach bank statements or turn in their  package past deadline. “Answer the questions and make it look professional. Most brokers are good with  helping the prospective purchasers make a good board package. If they ask for  three years of tax returns, give them three years of tax returns,” Garfinkel says.  

 Peters adds, “the most important thing to do is create a perfect package. Give the Board  exactly what they ask for and make sure the package tells a complete story,  both financial and personal, about who you are. Don’t hold back. This process is invasive, but the buyer must simply yield and  co-operate fully if he or she is to be successful.”  

 On the board side, “they need to fully inform themselves about the New York City fair housing laws  and what they may and may not ask. Many Board members do not possess this  knowledge and can expose themselves and their buildings to liability by asking  inappropriate or illegal questions,” Peters says.  

 The co-op admission process in New York City is rigorous, often requiring a  stack of detailed paperwork and financially and personally invasive interview  questions. While it may seem impossible to secure a decent co-op residency,  applicants who are professional, thorough and honest seem to be the most  successful.  

 Maggie Puniewska is a freelance writer and a frequent contributor to The  Cooperator.