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Can a Board Decline an Apartment Sale Over a Low Price?

April 12, 2018

The Cooperator
By A.J. Sidransky

Several Factors Determine Whether or Not a Transaction Goes Through

The power of a co-op board to approve or reject sales, as well as co-op applicants, is pretty much unlimited — as long as the decision is made within the limits of applicable law. Boards require extensive information and documentation — known generally as “board packages”– from prospective purchasers which can explore everything from an applicant’s financial position to their prior experiences as co-op owners elsewhere. Most board packages routinely require letters of recommendation and personal references for the purchaser(s). But then what accounts for the board’s authority in determining whether an apartment transaction can go through or not, especially if the price offered by the seller is considered low?

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Phyllis Weisberg, a partner at the New York law office of Montgomery McCracken Walker & Rhoads,  says: “A co-op board can turn down any applicant for any reason or no reason, as long as they don’t engage in prohibited discrimination.” Such reasons include price.

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