A:Hire an experienced real estate lawyer. Your lawyer will perform “due diligence” that includes reviewing the offering plan and amendments, by-laws, proprietary lease (for co-op apartments), house rules, and financial statements for the building. In addition, your attorney should review the board minutes, and review the New York City Department of Buildings’ website for any open building permits. Finally, your attorney should draft and submit a due diligence questionnaire to the building’s property manager to ascertain any physical, financial or legal issues facing the building.

A:It is customary for the Seller’s attorney to prepare the contract. Your attorney will review it with you, and negotiate any revisions necessary with the Seller’s attorney. When the contract is fully negotiated, you will sign and return it to your attorney with the deposit.

A:In most circumstances, the deposit is 10% of the purchase price and is held by the seller’s attorney in a special bank account called an attorney escrow account.

A:If you are purchasing a co-op apartment, you must complete and submit an application to the managing agent for the building. The purchase application generally requires personal and business references, a statement of assets and liabilities, income tax returns and recent bank statements. If you are purchasing a condo apartment, the application is far less extensive. If you are working with a real estate broker, your broker will review your application prior to its submission to the managing agent.

A:No, but most contracts contain provisions that allow the purchaser to cancel the contract and recover the deposit if certain events occur. These provisions are called “contingencies”

A:If you are purchasing a co-op, unconditional approval of the sale by the building’s board of directors is a standard contingency. In a condominium contract, receipt of a waiver of the right of first refusal by the condominium’s board is a standard contingency. Your contract may also contain a financing contingency that allows you to cancel the contract and recover your downpayment if you are unable to obtain a loan commitment from an institutional lender to finance your purchase.

A:You should provide your attorney with a copy of the loan commitment letter along with any correspondence from your lender’s attorney, and discuss any loan conditions with your mortgage company or lender. If you’re purchasing a co-op, you will need to sign and deliver to your real estate broker a document called a “Recognition Agreement” or “Aztech Form” which is prepared by the lender’s attorney. You will also need to sign an authorization to file a UCC-1 financing statement, which will create a lien in favor of the lender.

A:For co-op purchases, the lien search is required to determine if there are any judgments or liens against you, the seller, the apartment or the co-op building. All judgments or liens have to be removed at or prior to closing. For condo purchases, the title report serves the same function and ensures that the purchaser will receive clean and marketable title to the property. Both the lien search and title report are ordered by your attorney.

A:A closing is a meeting (which may be held remotely) between the purchaser and seller where the balance of the purchase price is paid to the seller and the purchaser becomes the new owner of the apartment. It is very important to be aware that although the contract will contain a closing date, that date is a target date only since there are many variables and numerous tasks that must be accomplished between the signing of the contract and the closing. The closing is scheduled when all of the conditions in the loan commitment letter have been satisfied, the UCC-1 has been recorded, the purchaser’s application has been approved (for co-op purchases) or the waiver of the right of first refusal has been issued (for condominium purchases), the seller has removed all title issues and arranged for the payoff of his or her mortgage, if any, and when your attorney, the seller’s attorney, the title company (if condo purchase), the managing agent and the lender’s attorney have arrived at a mutually agreeable closing time, place and date.

A:The law in New York generally allows either party to postpone the closing for up to 30 days beyond the closing date set forth in the contract.

A:Closing costs will vary depending on the type of property purchased, the purchase price and the type of loan selected. Generally, closing costs for a single-family house, brownstone or condominium apartment will be greater than those for a cooperative apartment because you will need to obtain title insurance and pay mortgage recording tax, if you are financing a portion of the purchase price. Purchasing a home from a Sponsor or Developer of a co-op or condo building may also increase your closing costs if you are required to pay the seller’s transfer taxes and legal fees. After you submit your application for financing, your lender will send you a document called a “Closing Disclosure”. This will give you an estimate of your closing costs. You should consult with your attorney to ensure that the estimate costs conform to your understanding of the costs of purchasing and financing.