Closings glossary
Proprietary lease
The occupancy lease a co-op corporation grants a shareholder for a specific unit. It is assigned at closing together with the stock certificate for the allocated shares, and its amendments, rather than the original text, carry the building's current rules.
What is a proprietary lease in a co-op?
Quick Answer
The full definition
The occupancy lease a co-op corporation grants a shareholder for a specific unit. It is assigned at closing together with the stock certificate for the allocated shares, and its amendments, rather than the original text, carry the building's current rules.
Which related terms should you know?
These are the terms that come up alongside proprietary lease in the same file.
- Stock certificate (co-op)
- The certificate evidencing the shares allocated to a co-op apartment. Shares and the proprietary lease travel together and cannot be sold separately from each other.
- Aztech recognition agreement
- The agreement in which a co-op corporation acknowledges a lender's security interest in a shareholder's shares and proprietary lease. The Aztech form is the version most New York co-ops accept.
- Maintenance (co-op)
- The monthly charge a co-op levies on each shareholder, covering building operations plus that shareholder's share of real estate taxes and the underlying mortgage.
- Co-op lien search
- The search performed on a co-op purchase covering UCC filings, judgments, liens and unpaid building charges tied to the shares and to the selling shareholder. It supports no policy of insurance, so the protection comes from clearing what it reports before the closing rather than from insuring around it.
- Offering plan
- The sponsor's filed disclosure document for a co-op or condominium, carrying its budget, share or common interest allocation, building rules and sponsor commitments.
Where does proprietary lease come up in a New York City closing?
A Sunnyside co-op closing transfers 285 shares and the proprietary lease for apartment 4C, with no deed and nothing recorded in ACRIS.
What else should you read before closing?
Questions this raises
- What is an alteration agreement?An alteration agreement governs renovation in a NYC co-op or condo: plans, permits, insurance, deposits, work hours and liability. What buyers shou...
- Can you sublet a co-op in NYC?Most NYC co-ops allow subletting only under strict limits: waiting periods, board approval, term caps and sublet fees. What the lease and house rul...
- What documents do I sign at closing?Note, mortgage, title affidavit, settlement statement and transfer tax returns for buyers; deed and releases for sellers. What each document actual...
Building types
- Standard co-opThe ordinary New York City cooperative: you buy shares in a corporation and receive a proprietary lease to occupy a specific apartment.
- HDFC co-opAn affordable cooperative formed under Article XI of the Private Housing Finance Law, with an income cap on purchasers and a flip tax that runs to ...
- CondopA building split into two condominium units, one commercial and one residential, where the residential unit is owned by a cooperative corporation.
- Land-lease co-opA cooperative that owns its building but leases the ground beneath it from a separate landowner, on a lease with a reset schedule and an expiry date.
Have a closing coming up?
Tell us about the transaction. An attorney reads every intake form and responds the same business day.
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.