The major problem with this is that boards and managing agents are requiring large sums in legal fees when such requests for clearance are submitted to boards. In my case, the combined fees would surpass the cost of setting up a trust.
This problem raises several questions for me. What changes in deeds or wills must be considered during this process? How are boards to respond when a unit owner indicates that a trust will own the unit? Will a properly executed will allow for family members to inherit the ownership? And finally, why are such extravagant fees being requested of unit owners?
Any clarification on this matter would help immeasurably.
-Great Neck Shareholder
“Historically, co-op boards were reluctant to permit ownership by a trust. Specifically, boards were troubled by such issues as service of process, rights to occupancy, rights to vote shares and lack of personal liability for the payment of maintenance and other charges to the corporation. In order to allay these concerns and adequately protect the co-op, attorneys representing co-op boards may require the execution of certain documents that specify who may live in the apartment, who may vote the shares and act as agent for the service of process and who will be personally responsible for monetary obligations to the co-op. When all of these protections are put into place, boards have been willing to permit trust ownership. The legal fees that are billed to the grantor of the trust relate to the review of the instrument creating the trust, to ensure that it contains nothing detrimental to the co-op’s interest, and to the drafting of the documents mentioned. In addition, the co-op’s transfer agent must prepare and supervise the execution of all of the standard transfer documents and will collect its usual transfer fee.