Chapter 24 Flashcards
What do bylaws do?
Form the basis for conducting business. Focus on corporate governance and how the board operates.
What are house rules when it comes to co-ops?
Habitations rules.
Day to day activity.
Helps people live together without conflict.
Ex: no baby strollers in the hallway
Common charges is to condos, as house rules are to?
Co-ops
The owner owns shares in a corporation. What does this describe?
A co-op
Which one has to pay a mortgage on their own? Co-op or condo owner?
Condominium
Who has Fee Simple ownership (complete ownership)
Condos
Proprietary lease = condo or co-op?
Co-op
Who has an underlying mortgage?
Co-op
Does the IRS tax co-ops the same way as condos and single family homes?
Yes
Maintenance fees belong to condos or co-ops?
Co-ops
Maintenance fees are to co-ops and blank are to condos.
Common charges
Board of directors go to?
Board of managers go to?
Co-op : board of directors
Condos: board of members
Is a co-op real property/real estate or are they personal property?
Personal property, chattel, they’re movesble
Deed is for co-ops or condos?
Condos because you need fee simple for deeds
What are reserves? (Condos)
Money set aside for future expenses
Money set aside for future expenses
Reserves
What is a letter of intent?
Letter sent out to reserve a unit for possible purchase
The habitations rules that govern all shareholders in a co-op are called what?
House rules
Is yhe income tax treatment (IRS) for an owner of a co-op apartment the same as an owner of a single family home?
Yes
In a co-op, what does each shareholder receive in their ownership?
Stock in a corporation
What is the board package in a co-op?
A person interested in purchasing a unit in a co-op submits their personal and financial information to the board of directors with this package
Can the board of directors deny you for a co-op?
Yes
Unlike a co-op, a condo typically does not have an underlying loan on the land and common elements. Is this true?
Yes
Residents of a building who learn that the building they live in may be converted into condos have the opportunity to read about the conversation in
The red herring
You can express your interested or make an offer for purchasing a unit in a project being developed to become a CONDO through what?
Letter of intent
When I bought a unit for a co-op, I got financing from a bank, which required the board to sign this form acknowledging the bank’s lien interest in the my interest in the shares. What form is this?
Recognition agreement
The 80/20 rule that applies to co-ops restricts the level of
Passive income
