(Image courtesy of Nick Youngson)
A common, but infuriating, occurrence in buying into a coop is putting money in escrow. After being subjected to the invasive, coop application and interview process, after their financial information has been exposed and reviews by strangers, buyers are told essentially “welcome to the building but we don’t trust you.” Then they go on to require a deposit of 6-24 months maintenance in an escrow account that will pay you 0% interest until you are financially sound.
Personally, I believe that such demands are unethical even if they are commonplace. But this isn’t what makes me truly crazy. I have seen Seller Attorneys try to write in an escrow clause into a contract – believing that this will make the sale more attractive to passing the building’s board of directors.
I would never advise a client of mine to sign a contract that is basically screaming for the coop to take your money in escrow. Don’t let this happen to you.
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