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Steps to purchasing your building Overview


The Tenant Purchase process starts when residents of a property receive a Notice of Offer of Sale from the owner of their property. The law separates buildings into 3 categories based upon their size; all of which follow slightly different timelines. Below is a description of all three of these categories and their respective timelines. 

Five or More Units | Two to Four Units | Single Family

Five or More Units

If your building is this size, you have 45 days after you receive your Notice of Offer of Sale letter to complete the following 3 tasks to stay in the process (30 days if a tenant association already exists)

hands holding house
  • Incorporate a Tenant Association (TA) — To participate, all tenant associations must be incorporated. This should be done with help from ULS Homeworks or other qualified housing professionals.
  • Registration of TA — A Registration Packet must be submitted, including membership list, corporate documents, and other registration material to the Conversion and Sale Division of the Housing Regulation Administration inside the Department of Housing and Community Development, (DHCD).  Call ULS Homeworks to get a copy of the Registration Packet before you get started.
  • Send a Letter of Interest — The TA must send the landlord, or his agent, a letter of interest expressing its desire to purchase the offered property.

Hire a lawyer

Because the lawyers will play a major role in the process, it is important that they already have tenant purchase experience. ULS Homeworks can provide tenant associations with a list of such lawyers.

Sign A Contract

After incorporating and registering, tenants in a building of five or more units have up to 135 days to do the following;

  • Create and sign a contract to purchase— The TA's contract to purchase may have to match the terms of the existing purchase contract if one exists. Call ULS Homeworks for details.
  • Make a good faith deposit — The TA must make a deposit for the property; this is never more than five percent (5%) of the contract price and there are low cost loan programs that can help.

The TA then has up to 240 days before it must finally purchase the building. But before that can happen, the TA has to do the following:

  • Make a plan with a Developer —The TA should interview, and select a developer or consultant (with their lawyer’s help) and then collaboratively come up with a plan to finance, buy and renovate the building. It is important to consider the choice of developers/consultants carefully. They, along with the lawyer, are the biggest players in any development process.
  • Secure Financing to Buy — Along with their lawyer and development team; the TA must put together a financing package to purchase the building. Usually any loans for purchase are paid over 30 years or more and are always split fairly among residents.

Prepare for the next step— HOMEOWNERSHIP!
Tenants should prepare for the next stage: being owners. That means deciding between a co-op or condo arrangement, selecting a management company and lots of other decisions. It also means getting training on how to manage an valuable asset. Talk to your lawyers or ULS Homeworks on how to find out more information.

Five or More Units | Two to Four Units | Single Family

Two to four units

In a building of two to four (2-4) units a group of tenants do not need to officially form a tenant association, but they can still work as a group. If acting as a group, tenants have 15 days to send a letter of interest to the landlord and to the Conversion and Sale Division of the Housing Regulation Administration inside the Department of Housing and Community Development, (DHCD).  If the group does not submit a letter of interest, individual members then have seven (7) additional days to submit a letter of interest to the landlord and to the Conversion and Sale Office.

Hire a Lawyer

Buildings of two to four units are not required to have a lawyer, but it is highly recommended. ULS Homeworks can provide tenants with a list of such lawyers.

Sign A Contract

For two to four (2-4) unit buildings the tenant group has 90 days to:

  • Create and sign a contract to purchase— The TA's contract to purchase may have to match the terms of the existing purchase contract if one exists. Call ULS Homeworks for details.
  • Make a good faith deposit — Tenants must make a deposit for the property; this is never more than five percent (5%) of the contract price and there are low cost loan programs that can help.

If the group does not act together, the owner must give each individual tenant an additional 30 days to negotiate.

  • Make a plan with a Developer - The tenants should interview, and select a developer or consultant (with their lawyer’s help) and then collaboratively come up with a plan to finance, buy and renovate the building. It is important to consider the choice of developers/consultants carefully. They, along with the lawyer, are the biggest players in any development process.
  • Secure Financing to Buy - Along with their lawyer and development team; the tenant must put together a financing package to purchase the building. Usually any loans for purchase are paid over 30 years or more and are always split fairly among residents.
hands holding key

Prepare for the next step-HOMEOWNERSHIP!
Tenants should also prepare for the next stage: being owners. That means deciding between a co-op or condo arrangement, selecting a management company and lots of other decisions. It also means getting training on how to manage a valuable asset. Talk to your lawyers or ULS Homeworks on how to find out more information.

Five or More Units | Two to Four Units | Single Family

Single Family Homes

In single family homes the tenant has 30 days to submit a letter of interest in purchasing to the owner of the property and the Conversion and Sale Division of the Housing Regulation Administration inside the Department of Housing and Community Development, (DHCD).Conversion and Sales Office.

Hire a lawyer

For TOPA sales involving single family homes there is typically no need for a lawyer. Contact ULS Homeworks for more information.

Sign a Contract

Single family homes work a little differently from the larger buildings:  After expressing interest, the tenant has up to 75 days (60 if there is no 3rd party offer) to do the following;

  • Create and sign a contract to purchase— The TA's contract to purchase may have to match the terms of the existing purchase contract if one exists. Call ULS Homeworks for details.
  • Make a good faith deposit — The tenant must make a deposit for the property; this is never more than five percent (5%) of the contract price.

Buying the Building

The Tenant has up to 90 days after signing the purchase contract to secure financing through private loans, or other sources such as the District’s Home Purchase Assistance Program.

Five or More Units | Two to Four Units | Single Family