Building types
Standard condo
A New York City condominium unit: real property conveyed by deed, recorded in ACRIS, with an undivided interest in the common elements.
What is a standard condo and how does a condo closing work?
Quick Answer
What is the property interest, legally?
- The unit is real property created by a declaration under the Real Property Law condominium article
- Ownership is the unit plus an undivided interest in the common elements
- The deed records in ACRIS and the transfer is searchable in the public record
- Common charges are a lien on the unit, with priority rules set by statute and by the declaration
- The board holds a right of first refusal rather than an approval right
How is a purchase of this type financed?
- The loan is a recorded mortgage against real property, so mortgage recording tax applies
- A CEMA is available on a refinance or purchase where the existing lender will assign
- Lenders review the declaration, bylaws, budget, reserve level and owner-occupancy ratio
- A building with heavy investor ownership or pending litigation can be treated as non-warrantable
Which taxes and building fees apply?
- Mortgage recording tax under Tax Law section 253 applies to the recorded mortgage
- NYS transfer tax and NYC RPTT apply to the conveyance
- The mansion tax applies to residential purchases at the statutory thresholds
- Common charges and any assessment are adjusted at closing rather than taxed
What does the approval path look like?
- Contract signed and the board notified under the right-of-first-refusal provision
- Board issues a waiver, or the statutory period runs
- Title search, municipal searches and the condominium questionnaire ordered
- Lender clears conditions and issues the clear to close
- Closing held, then deed and mortgage recorded in ACRIS
Does a condo board have to approve a buyer?
No. A New York condominium board holds a right of first refusal, not an approval right. It either waives the right or exercises it and buys the unit on the same terms. Exercise is rare, so in practice the step is the timing of the waiver, not a decision on the purchaser.
Why does a condo carry title insurance when a co-op does not?
Because a condominium unit is real property with a recorded chain of title, and a title policy insures that chain against defects that existed before the policy date. A co-op interest is personal property with no recorded chain, so the co-op lien and UCC searches do that work instead.
What are unpaid common charges worth to a buyer?
They are a lien on the unit, so they surface in the search and are usually paid out of the seller’s proceeds at closing. The declaration and the statute set how that lien ranks against a first mortgage, which is what decides who bears the loss when the arrears are large.
What else should you read before closing?
In the glossary
- ACRISNew York City's public index of recorded property documents. Deeds, mortgages, satisfactions, easements and many liens are recorded here, which mak...
- Mortgage recording taxThe New York tax due when a mortgage is recorded, computed on the new money secured. A CEMA is the standard structure used to reduce the taxable am...
- CEMA (Consolidation, Extension and Modification Agreement)An agreement in which an existing mortgage is assigned and consolidated with new financing rather than being satisfied and re-recorded. It requires...
- Owner's policyTitle insurance protecting the buyer's ownership interest, issued for the purchase price with a single premium. Coverage continues while the insure...
- Mansion taxA New York State tax paid by the buyer on residential conveyances of one million dollars or more, graduated upward through a series of higher price...
- Transfer tax (RPTT and NYS)Taxes on the conveyance itself, one City and one State. Rates step up at higher prices, and who pays is set by custom and then confirmed by the con...
Questions this raises
- What is title insurance?Title insurance covers defects in a property's past: old liens, recording errors, forged deeds, undisclosed heirs. How the coverage works in New York.
- What is the difference between an owner's policy and a lender's policy?An owner's policy insures the buyer for the purchase price. A lender's policy insures the bank for the loan amount. How the two differ on a New Yor...
- What gets recorded after a NYC closing?Deed, mortgage, assignments and satisfactions record through ACRIS with the City Register, along with transfer tax returns. What is filed instead o...
Building types
- New-development condoA first sale from the sponsor of a newly built condominium, governed by an offering plan, often delivered on a temporary certificate of occupancy.
- Condo in a converted buildingA condominium created by converting an existing rental building, where non-purchasing tenants, the reserve fund and building-wide conditions carry ...
- Mixed-use condo with commercial unitsA condominium holding both residential and commercial units, where the declaration allocates common charges, voting rights and use restrictions bet...
- Standard co-opThe ordinary New York City cooperative: you buy shares in a corporation and receive a proprietary lease to occupy a specific apartment.
- Co-op and condo refinance, and CEMARefinancing an apartment: a condo refinance can use a CEMA to cut mortgage recording tax, a co-op refinance cannot, because there is no recorded mo...
The statute itself
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Legal Disclaimer: This page is general information about New York practice. It is not legal advice, it does not account for the terms of any particular contract, building or transaction, and reading it does not create an attorney-client relationship. This is attorney advertising. Prior results do not guarantee similar outcomes.