Welcome to Part 8 of my ongoing blog series, “Purchasing an Apartment in New York City”.
In Part 7 of the series, “The Package Has Been Delivered, The Baby’s in the Crib…” – I prepared you physically and mentally for the several weeks of loss of control and communication while you waited for the waiver of first refusal (condo) or the request for a board interview (co-op) from the building’s board of directors.
Well, if you are reading this post, I presume you made it through the long wait alive and received that waiver or interview request, so congratulations are in order! If you have a waiver (condo purchase) in hand, feel free to put the Champagne on ice and skip to the next article in the series because the following information does not pertain to you.
However, for the 75% of you purchasing a coop, buckle up and get ready for the next step in your ride. The good news is, the board has reviewed several years of your financial history, proactive adherence to the house rules and best friend’s reference letter demonstrating your solid character and good taste, has gotten you to the one yard line. It’s time to iron your favorite Searsucker and brush up on your interview skills!
Let’s not beat around the bush, the anticipation and anxiety associated with the co-op board interview has been described by buyers in many different ways – very few of them positive. Here are a few of my favorites:
- High school student council elections
- The final interview for a job I no longer wanted
- The ultimate exercise in patience
- Speed dating in hell
- Walking in traffic and kind of hoping you get hit by a car
- A networking mixer at FBI headquarters
After all, can you think of another situation in life in which you spend three months defending your worth (literally and figuratively) to a group of people you don’t know (but who might end up being your next door neighbor) and it all hinges on a 30-60 minute, somewhat awkward meeting in a building basement with a 3-7 adults who can’t agree on whether they should plant hydrangeas or daffodils on the roof deck, but whose authority is boundless when it comes to your home? Me either.
But, let’s do our best to set aside our pent-up anger and frustration with the process and talk about what you can REALLY expect in the board interview. As I mentioned, the fact that the board has requested (or dare I say “granted”) an interview is a HUGE hurdle in your journey to a successful closing. In most cases, this step indicates that the board has deemed you financially (and organizationally) worthy to become a shareholder in their corporation. The interview is just the board’s opportunity to meet you, your spouse and sometimes your pet to make sure you are who you and your friends and work colleagues say you are – a kind, respectful, reasonably quiet, somewhat (but not too) memorable human being who will not disrupt the peace and serenity of their Utopian community.
In an effort to leave as little to chance as possible, here is a list of 10 things to consider when preparing for the “Big Dance”…
- How to respond to the request for an interview: SAY, YES (and “thank you”)! Remember, the board is interviewing you, not the other way around. Just as you would not ask the CEO to change the requested date and time of the final round interview for your dream job, try not to ask the board to offer another date for your board interview. The board members interviewing you may have limited availability, another interview scheduled before or after yours, or perhaps they have chosen to interview you during a regularly scheduled board meeting. In addition, remember that the success of the purchase/sale is far more important to you and the seller than it is to the board. So, do your best to accommodate them!
Note: If for some reason you have a work trip scheduled, my advice would be to have your agent communicate that information to the management company and board in advance. That way they can take that info into account when scheduling your interview, and there is less chance of upsetting them if you cannot accommodate their first choice for an interview date.
- When: Typically interviews will take place on a weekday evening. As I mentioned above, in some cases the board will conduct interviews on the night of their monthly board meeting, but each board is different. It may depend on how many members attend interviews and where they conduct them, but it is safe to assume a start time between 6PM and 8PM, Monday – Thursday.
- How (and when) it will end: It ends when they say it ends! 🙂 In all seriousness, the interview will typically end with the board asking you if you have any further questions for them (if they have a shred of humanity anyway). At that point the board may conclude with one of several statements including – “Congratulations, we look forward to welcoming you to our community!” or “Thanks for coming in, we will be in touch.” or “Have a nice night.” The point is, don’t read into the way the interview ends. It may be the board’s policy to not give a positive or negative indication to the interviewee, so they can discuss as a group to make sure no member had any serious concerns or objections. Thank them for their time and take your leave.
- Do I need to have my package memorized: No. Although, you should certainly know what was in your package and I recommend taking a look at it once your agent completes it. But, you don’t need to memorize each page and line. You don’t even need to have a copy with you, but you are welcome to bring one if you choose. Each board member will have a copy of your package and may or may not bring it to the interview for reference – but it should not be a test.
- How Long: Depending on the board, the schedule for the rest of their evening and/or the amount of “gabbing” that happens (small talk is not a bad thing), your Interview may be over in twenty minutes or two hours. That said, 30-60 minutes is a good rule of thumb. Don’t read anything into the length of your interview (unless they say something like, “OK, I have had just about enough of this. We are done here!”, which may not be a good sign).
- Topics Discussed: Oh, if I only had a crystal ball. All I can say is, keep an open mind and do your best to give the interviewers the benefit of the doubt regarding the reasoning behind their questions. Keep in mind, rarely are board members given guidance or training on what to ask a prospective shareholder and why. Some questions may seem downright strange, but try to avoid getting defensive or aggressive. Bob and weave, side step or pivot…but never jab back or throw a counterpunch.
- Who (your side): In general, the board will want to interview every adult associated with the purchase including purchaser, co-purchaser, guarantor, adult occupant and perhaps even the Yoda bobblehead you intend to keep on your desk. That is certainly something you should clarify to make sure you understand the expectation. In many cases, the family pet or pets (especially dogs) will be asked to make an appearance to make sure they are not aggressive and look like the picture you included in your board package.
Note: It is not common for interviewees to attend a board meeting via Skype, FaceTime or hologram. The expectation is that all requested interviewees will attend in person for the full interview.
- Who (their side): I don’t want to sound like a broken record but…it depends. Some boards will conduct the interview in front of the entire board which may consist of 5-9 (or more) members depending on the size of the building and the co-op bylaws. More likely, the board has a review committee or will choose two or three board members to conduct the interview to make scheduling easier and the interview more streamlined. There are some interviews conducted by a single board member who then reports back to the rest of the board so they can issue the official approval as a group. I recommend asking your real estate professional or the managing agent how many board members will be interviewing you so that you are prepared for the size of the crowd.
- How to prepare: If you are working with a real estate professional, interview preparation is one of the most important benefits they can offer you in the co-op purchase process. They will cover much of what I cover in this article and can potentially offer some advice specifically pertaining to the building in which you are purchasing. As I mentioned previously, knowing what information is in your board package is also helpful.
- Dos and Don’ts: I often start my interview prep on “Dos and Don’ts“ with the following:
a) be yourself
b) treat it like a job interview and answer questions truthfully, but not offensively
c) be affable and professional, but not memorable.
Sample Dos: Show up on time (or actually 10 minutes early is a good idea), dress well (business casual on most cases is sufficient – no t-shirts or jeans) and be cordial, deferential and pleasant. If all else fails, ask the board members to tell you more about themselves and the building and LISTEN, LISTEN, LISTEN!
Sample Don’ts: Most of these go without saying but I will list a few: If you love to play the drums at midnight, I wouldn’t mention it. If you are interested in some day being a board member, your board Interview is not the time to ask about how to run your campaign and unseat the people sitting in front of you. If you are upset or frustrated by the process or length of time it has taken, keep it to yourself for one more day. If you plan to get a pet in the future, wait until you are a shareholder before discussing that process in detail.
OK, I get it. This may seem like a lot of information and effort (and words) for a simple little interview. But, when your this close to the last stage of a long hike – the trek to the summit so to speak – we might as well make sure we don’t slip on some loose rock and tumble back down to the bottom of the mountain.
Although, you will likely leave your interview without the official stamp of approval from the board, you can expect their decision relatively quickly (within the next 24 to 48 hours), which will be communicated by the transfer agent to your real estate professional somewhat anti-climatically given the stakes…
Thanks for sticking with me and I will see you on the other side of the interview – OFFICIAL APPROVAL!
My name is Eirik Davey-Gislason and I work in real estate in New York City. This blog is an opportunity for me to educate everyone who has a horror story or is on the verge of one. By sharing, preparing and advising my audience on what to expect, what is normal, what is right, and what is wrong, I hope to do my part to expose the wrong-doers and shape the future of this dysfunctional thing we call NYC Real Estate.