The Rental Process: Know What to Expect
Difference Between Condos, Co-ops and Rental Buildings
While renting a condo can be slightly easier of a process than a co-op, there is still a board package that must be completed. The board package of a condo can sometimes be as thorough as that of a co-op and as long as a purchase application package, however it's typically not required for you to interview with the board. Also keep in mind that there are additional fees associated with the board review, just like in a co-op.
The landlord in a co-op is not exactly a traditional property owner. Unlike a condo, where the owner owns the unit in the building, a co-op owner owns a share of the corporation. As such, the process is a little more complicated than other building types. As well as meeting the landlord's requirements, like rental buildings and condos, applicants must meet the building's requirements as stated in the lease application package. A complete board package is required for co-op rentals. This package is the same whether you are renting or purchasing in a co-op. Once the board reviews the board package, an interview is scheduled, and then the approval will be given to the managing agent.
Something to keep in mind is that typically, co-ops do not allow units to be rented out for a term longer than one or two years. Also, if you're on a time crunch to rent, a co-op may not be the best option, as it often takes at least thirty days to go through the review process.
Rental buildings are not only easier, there are a vast range of price points and building types (new developments, brownstone, multi family, etc.) While condos and co-ops have a board package, rental units are much easier in that they only require an application. You also don't need to interview with a board, and fees are usually less than condos and co-ops. Turnaround is much faster, typically taking around three business days for the entire approval process.
What's a Guarantor?
Also called a co-signer, a guarantor is someone who will guarantee your entire lease. If you do not meet the landlord's financial or credit requirements, or are a student with no income or credit history, a guarantor may be your solution. Students or individuals with no income or credit history. If you think you need a guarantor, make sure to let me as your agent know so I can prepare accordingly.
Fees and Commissions
If a board approval is required, I will hold the landlord and commission fees until leases are signed and board approval is received.
Here are the fees you will be expected to pay:
First month's rent and security deposit
Application fees and credit check fees
Move-in fees (if required)
Broker commission (subject to the terms of the listing agreement with the landlord)
*** Please note that each building varies slightly in their requirements but this list will help you get started.
New York City moves at a very quick pace. It's not uncommon to find the perfect apartment and find that a day later, sometimes even the same afternoon, it's no longer available. Make sure you gather your required documents and have everything ready so when you find what you're looking for, you are first in line.
Credit reports must be run on every applicant and guarantor. The fees for credit checks should not exceed $20 per applicant. You may find that when renting a condo or co-op, as opposed to a rental building, the landlord may require a credit check as well as the one done by the managing agent. Please note that credit reports must be done by the landlord and/or managing agent and that any credit check provided by you as the tenant will not be accepted.
The information in the credit report is extremely important for the approval of an application so make sure you're informed as to what is considered inadequate.
A few old late payments are usually okay. A high revolving balance is not good. Past due payments that are still outstanding are bad. Delinquencies and collections are very bad. If you suspect that your credit is not good, be sure to let me know. This will allow me to prepare accordingly.
Keep in mind that different landlords deal with credit issues in different ways. Some may allow you to use a guarantor, while others may simply reject the application.
Personal Checks Vs. Certified Bank Checks Vs. Cashier's Check Vs. Money Orders
When providing payments as the last step of rental transaction, there's nothing more frustrating than providing checks and then being told that they are the "wrong types of checks". It's important to read carefully what your new landlord is requesting, and make sure that you understand the difference:
This type of check is connected to your bank account which could be a savings or checking account. There are two types of personal bank checks:
One will have your name and address printed on them, as well as your account and routing numbers...
...while the other (also referred to as a "blank check") does not contain your name or address but still contains your account and routing numbers.
In a personal bank check, the funds are taken directly from your bank account. Typically landlords do not accept personal bank checks as payment because the check does not guarantee that your account has the funds, and so it can take a few days for the funds to be released.
Certified Bank Check
This type of check is certified by the bank that you have enough funds and that your signature is genuine. usually, but not always, the bank will set aside the funds. The face of the check bears the word ‘certified’ or ‘accepted,’ and is signed by an official of the bank issuing the check. This is typically the check that landlords require for payment.
***Make sure the check has the word "certified" or "accepted" on it. If it doesn't, it's not a certified bank check.
These types of checks are checks signed and guaranteed by the bank. This means the funds are coming from the bank instead of your account; which usually means they immediately take the money from your account. The depositor pays for the cashier's check with funds from their own account and the bank holds the money is its own account. When it's deposited or cashed, the funds are drawn from the bank's account. This is usually the most secure of the options and usually doesn't have many restrictions. Some landlords may not accept cashier's checks because there are fees involved with retrieving the funds.
This form of payment is similar to a certified check, however it needs to be prepaid. Money orders may also have maximum face values allowed.