NY Cooperative Application Fees are not Limited by New Law
New York State has clarified that the Housing Stability and Tenant Protection Act does not restrict Cooperative boards from charging more than $20 for purchase applications.
On September 13, 2019, New York State Department of State issued guidance for real estate professionals (the guidance) concerning the Housing Security & Tenant Protection Act of 2019 (the Act). The guidance loosens the application of the $20 limit on application fees and background checks for coops. Therefore, coop boards may charge application fees in excess of $20 in connection with the sale of a coop unit.
It is not clear how this all affects sublet fees and whether they can till be charged above the limit. The other part of the law that still applies to coops is the limit on security deposits to one month’s rent or maintenance. Some coop boards required substantial maintenance escrows as a condition of the approval of the sale. The law prevents this now. Also, the law limits late fees to $50 or 5 percent of monthly maintenance, and has provisions that will make it more expensive and difficult to evict residents who fail to pay their rent or breach the proprietary lease. Stay tuned as we learn more from the State.
