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The co-op board rejection. While the notion strikes fear into prospective buyers’ hearts, if you’ve made it as far as the board interview in the approval process, you should know that it’s extremely rare to be denied at that stage—Most boards just want to make sure you’re not a raving lunatic.
That said, occasionally, seemingly attractive would-be shareholders are turned away, both pre- and post-interview. (Case in point: Brick Underground heard an anecdote about a potential buyer that was denied because the board of a small co-op with a handful of units thought she was too rich. They were afraid she’d slowly buy up the building, gain majority voting power, and kick them out!)
Inspired by that unusual anecdote, we asked around for some of the weirdest tales of rejection by New York City co-op boards. Here’s what agents shared.
"I had a listing that we thought would be difficult to sell but to our surprise someone quickly made an offer and it was accepted. They had great financials and a really nice board package. It was submitted and they were immediately turned down. We were absolutely stunned, but I finally found out that one of their reference letters came from a prior shareholder in the building, and that shareholder was a total nuisance: Constantly flouting board rules, short-term renting their apartment like a hotel, you name it. The moment the board saw that name they must have thought: 'Oh no, not this again.'" —Victoria A. Matus, Brown Harris Stevens
Too close for comfort
"I had a board turndown because the [adult] daughter of the buyers did not want her parents to move into the same building [where she was living]. [There was a] common lobby. [She] saw to it they were turned down!...The parents never knew what happened or why they were turned down." —Doug Russell, Brown Harris Stevens
“I’ve had exactly one turndown in my 16 years in real estate. I take personal pride in creating excellent board packages even when a buyer presents a difficult challenge. But this time, the would-be buyer seemed ideal. He was the owner of three restaurants in Manhattan, had very low debt, a net income of $750,000 and a great credit score. To my surprise, he was turned down because if one of his restaurants were to go under, the board feared that he would not be able to carry his monthly expenses. To them, the restaurant business was too volatile, even though he owned the three restaurants for over 20 years!” —Michelle Sedlitz, Licensed Real Estate Salesperson, Citi Habitats
"The only time one of my buyers was turned down was in a 'laid back' co-op because he, a self-made super successful entrepreneur, was only 27 years old. Every shareholder was in their 50s or 60s…They didn’t want a younger guy in the building." —Sophie P. Ravet, Brown Harris Stevens
You can't dump me, I dump you!
"Applicant told the board he just lost his job. Board turned him down. Seller subsequently learned that applicant had not lost his job, but used it as an excuse to back out of the deal." —Alan Brasunas, Brown Harris Stevens
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