News About the Cooperative/Condominium Abatement
Recently, the NY State Legislature passed bill S2320/A3354, which amended the Co-op/Condo Abatement. For more information and a description of changes, click here.
Owners of cooperative units and condominiums who qualify for the Co-op/Condo Property Tax Abatement can have their property taxes reduced. The amount of the abatement is based on the average assessed value of the residential units in the building.
Abatement percentages are shown in the following table:
Average Assessed Value Benefit Amount Per Year
2012/2013 2013/2014 2014/2015
$50,000 or less 25% 26.5% 28.1%
$50,001 - $55,000 22.5% 23.8% 25.2%
$55,001 - $60,000 20% 21.2% 22.5%
$60,001 and above 17.5% 17.5% 17.5%
Co-op Tax Benefits Letter
Finance will be mailing a Co-op Tax Benefits Letter outlining each unit's tax savings for personal exemptions and the co-op property tax abatement. For more information and the Co-op Tax Benefit Change Form, click here.
Phase Outs for Owners Currently Receiving the Abatement
If you are an owner who is not using the unit as your primary residence and you received the abatement in 2011/2012, your abatement will be phased out. We mailed you a letter explaining that we think you no longer qualify for the abatement. As the deadline to respond to the letter has been extended, responses must be mailed by July 22, 2013 and sent to:
NYC Co-op/Condo Abatement P.O. Box 1194 Maplewood, NJ 07040
This is how the phase out will work:
Tax Year Phase Out Abatement Amount How You or Your Co-op Board Will
See This on Your Bill
2012/2013 50% of the 2011/2012 abatement You or your board will see an Abatement
percentage you received before the Reversal Charge on your 2013/2014
abatement was amended. Property Tax Bills.
2013/2014 25% of the 2011/2012 abatement You or your board will see a reduced
percentage you received before the abatement amount on your 2013/2014
abatement was amended. property tax bills starting with your July
2013 bill
2014/2015 0% Abatement will no longer appear on
your property tax bill.
How to Apply
Cooperative and condominium developments that are filing for the abatement for the first time should complete the Cooperative and Condominium Property Tax Abatement application. The application must be submitted by the board of directors or managing agent on behalf of the entire development.
Deadline: Applications for new cooperative and condominium developments were due April 1, 2013.
Application for 2014/2015 Coming Soon
Cooperative/Condominium Tax Abatement FAQ
Requirements
The co-op or condo unit must be the owner's primary residence.
Co-op or condo owners cannot own more than three residential units in any one development and one of the units must be the owner’s primary residence.
Co-op or condo owners cannot be receiving any of the following exemptions or abatements:
J-51 Exemption
420c, 421a, 421b, or 421g
Housing Development Fund Corporation (HDFC)
Division of Alternative Management Programs (DAMP)
Limited Divided Housing Companies, Redevelopment Companies
Mitchell-Lama Building
Clergy
Units held by sponsors or their successors in interest are not eligible.
Units owned by a trust are eligible only if the unit is the primary residence of the beneficiary of the trust, trustee, or life estate holder.
For more information on requirements and recent changes to the abatement click here.
Note for Property Owners:
You may also be eligible to receive the following personal exemptions: Basic or Enhanced School Tax Relief (STAR), Disabled Homeowner, Senior Citizen Homeowner and Veterans. The application for these exemptions must be postmarked by March 15. If you own a co-op, contact your management company to find out what exemptions you are receiving in the current tax year (July to June). Call before March so that you will still have time to apply for benefits in the next tax year. If you own a condo, you can find your current exemptions on your Property Tax Bill
.
On January 18, 2013, Fannie Mae and Freddie Mac announced changes to their servicing requirements for short sales. Please see below for some key changes that all parties involved in a short sale should be aware of. These changes apply
to all Fannie Mae and Freddie Mac short sales; with an offer and without an offer.
Title Transfer requirement change:
The buyer is prohibited from selling the property for any sales price for a period of 30 days from the date of the deed.
After a 30 day period, and until 90 days from the date of the deed the buyer is further prohibited from selling the property for a sales price greater than 120% of the short sale price.
Note: The above restrictions will run with the land, which means that the restriction is not
personal to the seller and will pass to the subsequent buyer upon transfer of title.
Below is an example on how to calculate the 120%
Purchase Price is $100,000.00
120% of the purchase price would be $100,000.00 X 1.2 = $120,000.00
Relocation Assistance:
The borrower may be entitled to an incentive payment of $3,000 from Fannie Mae/Freddie Mac to assist with relocation expenses following successful completion of a short sale unless:
1. The borrower is required to contribute funds or execute a promissory note.
2. The borrower has Permanent Change of Station (PCS) orders and receives a Dislocation Allowance (DLA) or other government relocation assistance.
3. The servicer has knowledge that the borrower is receiving relocation assistance from
another source other than the servicer.
Note: If the borrower receives relocation assistance from a source other than Fannie Mae / Freddie Mac or the Servicer, the difference in the relocation assistance amount up to the $3,000 incentive maximum may be provided. If the borrower will receive relocation assistance from a source other than Fannie Mae / Freddie Mac or the Servicer and the amount is equal to or greater than $3,000, no relocation incentive will be provided.
It is vital to have an attorney negotiate and close your short sale transaction. Call THE LAW OFFICES OF JEANNE M. REARDON to assist you with your short sale. Free initial consultation. Call us at (516) 314-8433.
Posted on December 2, 2011 at 11:17 PMThe Home Equity Theft Prevention Act ("HETPA") became effective on February 1, 2007 and now governs certain sales of homes in foreclosure or default. If you are planning to sell a home in foreclosure or default, you should be aware of your rights under the Act, and know what to expect from a legitimate buyer. The Home Equity Theft Prevention Act was passed in response to recent scams which targeted homeowners in financial distress (often elderly or unsophisticated homeowners).
Home equity theft occurs when investors approach a vulnerable homeowner in foreclosure or default and agree to pay off the arrearage owed on the mortgage by the homeowner, and in return, require the homeowner to sign the deed over to them. Often the homeowner through a reconveyance agreement is allowed to continue to live in the property renting it from the investor with the promise that they can buy back the property at some later date. The reality is, however, that the homeowner is often evicted and the investor sells the property to a third-party, keeping all the equity. In other instances, the investor cashes out on the equity in the home with a new mortgage– usually through a cash-out refinance, leaving the homeowner with a mortgage balance larger than the previous and a monthly payment that is completely unaffordable.
Definitions and Covered Transactions
Under the Act, a Covered Contract is defined as a contract or agreement between an Equity Seller and an Equity Purchaser. The homeowner or property owner at the time of the equity sale is referred to as the Equity Seller. An Equity Purchaser is defined as any person who acquires title to any residence in foreclosure or default.
Only transactions involving an Equity Purchaser are covered by the Act. Most real estate transactions between sellers and Purchasers, however, are not covered by the Act because the law excludes from the definition of Equity Purchaser those who purchase a property as follows:
• To use, and then actually uses, the property as his/her primary residence;
• By a deed from a referee in a foreclosure sale;
• At any sale of property authorized by statute;
• By order or judgment of any court;
• From a spouse, or from a parent, grandparent, child, grandchild or sibling of such person or such
person’s spouse;
• As a not-for-profit housing organization or as a public housing agency; or
• As a bona fide purchaser or encumbrancer for value (e.g. a lienholder)
Contract Requirements
In order to protect homeowners, the contract of sale between an equity seller and equity purchaser must meet the following requirements: Contract must be fully completed (i.e., no blank spaces); Font size of the printed contract must be equal to at least 12-point bold type; If Spanish is primary language of the seller, the agreement must be provided in English and in Spanish; Name, address and phone number of the buyer; Address of the subject property; Consideration to be paid; List of all services that buyer has promised; Terms for payment of the consideration; Time at which possession of the property must be surrendered; Terms of any rental or lease agreement; Terms of any reconveyance agreement; Notice of right to cancellation in the immediate proximity of signature line and must be printed in 14-point type on the agreement; and Notice of cancellation form to be attached to the contract.
5-Day Right of Rescission
The Act also gives the equity seller a five-day right to cancel the contract. Once an equity seller cancels the contract, the equity purchaser must return all contracts and other documents signed by the seller within 10 days of cancellation. Cancellation of the contract releases the equity seller of all obligations to the equity purchaser.
Remedies
2-Year Right of Rescission - Generally, a violation of the contractual requirements of the Act makes the conveyance voidable and may be rescinded by the homeowner within 2 years of the date the deed was recorded. The statute then gives the purchaser (or its successor) twenty days to reconvey the property on the condition of repayment of any consideration paid to the seller.
6-Year Statute of Limitations - Within 6 years, a homeowner may bring a cause of action for damages or equitable relief, treble damages and attorneys fees and costs for a violation of HETPA. Additionally, an equity purchaser can be held criminally liable for violations of the law as either a Class E Felony or a Class A misdemeanor and subject to a fine of not more than $25,000.00.
For more information, see New York State Banking Department pamphlet on the Home Equity Theft Prevention Act.