My partner and I are buying our first apartment together. I am very excited, but also nervous. It’s the biggest purchase we have ever made together, and quite honestly the biggest purchase I have ever made in my life. My broker told me that I should put the mortgage in my name because my partner’s credit is bad. Are there any precautions we should take? Also, is there any way that the co-op board could refuse our application because we are gay?
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Dear First Time:
First, congratulations on your purchase. I hope it will be a wonderful home and good investment. As Will Rogers said, and as retold through the immortal words of Tony Soprano’s crewmember, “Buy land because they ain’t makin’ any more of it.”
Having said that, there are certainly some issues you want to think out before taking on the substantial liabilities involved with a mortgage. Putting aside some emerging law and assuming that you are not a married couple, it is possible that the law will view your property and your liabilities exactly as you title them. That means that if the co-op is in both your names, you both own it, and if the mortgage is in your name, it is only your credit that is at stake. I would highly recommend that you put together an agreement that addresses the issue regarding mortgage and your expectations and understanding of each of your obligations in the purchase. There are larger issues here to discuss with your attorney, but suffice it to say you should definitely have a long discussion with your partner regarding what exactly your expectations are regarding this acquisition and make sure that they are fully reflected in a signed understanding between both of you. You should also make sure your attorney, broker, and everyone involved in the transaction understand your relationship and these expectations so that they property can be properly titled to reflect it (i.e. tenants in common without rights of survivorship or joint tenants with rights of survivorship).
Finally, you raise an interesting question regarding board approval. It is also a larger issue, but as it stands now, technically, no one can discriminate against you based on your sexual orientation in New York, as well as in many other surrounding states and cities. However, interestingly, co-op boards in New York do not have to disclose their reasons for disapproving applicants. There is currently proposed legislation in New York City Council that would require boards to disclose their reasons for disapproval and therefore potentially limit it being based on discrimination but, unfortunately, it may be some time before that happens.
*This column is not a consultation with an attorney and should in no way be construed as such or as a substitute for such consultation. Anyone with legal issues or concerns should seek the advice of her own attorney.
© 2012 GO NYC MEDIA LLC. All rights reserved. Reprinted with permission. See original here.