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Playing the co-op board game

When it comes to buying a co-op apartment, there's often a

disconnect between how the application process works and how people think it

works. Not surprising, considering "it's a system that prides itself on the

mystery about it," observes Barbara Corcoran, founder of the Corcoran Group.

Unfortunately for buyers hoping for transparency, much of the mystery is

legal. Co-op boards do not have to disclose what they are looking for in a

buyer or why they reject someone - so they don't.

Indeed, a co-op board may not discriminate for race, gender or religion.

"Other than that, the board has discretion," notes real estate lawyer Lisa

Breier Urban of Manhattan.

Prudential Douglas Elliman executive vice president Jacky Teplitzky says,

"Figuring out what a board is looking for is more a mystery game than fact. The

boards won't say because it opens them up to liability. On buildings we have

never sold we are like FBI and CIA agents. We call managing agents and owners.

We compare notes with other brokers. We ask friends."

What about the co-op board scare stories? The couple rejected because of

the wife's Hollywood hair or the husband's gold chain. The dog that failed the

board interview.

"Urban myths," says Corcoran. "Being rejected is a public embarrassment.

You have friends providing references. People will write it off to the board's

unreason. This perpetuates the myth."

When Scott Shuster, former ABC News correspondent and now head of his own

business event planning firm, tapped his best references for his midtown

Manhattan co-op application last spring, he had a face-saving plan. "What would

I have told my references if I had been rejected? I had a strategy in place.

Lie. Lie. Lie."

"The fact is," Corcoran said, "nine out of 10 [applicants] are rejected on

paper for financial reasons and never meet the board."

Sylvia Shapiro, author of "The New York Co-op Bible," sees a more mundane

explanation for initial rejections. "Frequently, applications are incomplete or

inaccurate, requiring the board to request additional information ... a

process that can assume a life of its own," she says.

Although they vary from building to building, most applications require tax

returns, bank statements, documentation of assets and liabilities, credit and

employment history as well as references from colleagues and friends. "Often

neither the buyer nor seller is aware there's a problem with the application,"

Shapiro says. "Many of them don't get actively involved, abdicating the

responsibility to brokers."

Shapiro finds this reliance a problem in the overheated market, "where

there are many relative neophytes who may lack the financial expertise

necessary to fully understand and represent a buyer's financial condition."

What can a buyer do? "Get more involved in the application process,"

Shapiro advises. "If you don't feel qualified, have your lawyer or accountant

look over the application and get it right."

If an application is approved, the next step is the board interview, a

dreaded ritual, but in reality, Teplitzky says, "it's 90 percent a done deal if

someone is invited."

Judy Strauss, managing agent for Sennesh Properties agrees, "The only

reason someone would be rejected is if they show up insane."

Taking no chances, many brokers coach their clients.

Before an interview with an Upper East Side board, Sean Gibbons was sent

tips by Teplitzky's team. "I'm from Boston. We don't have co-ops. I found the

entire process ridiculous," he says. He heeded the tips, however, and zipped

his lip. He closed on his co-op in May.

Says Teplitzky, "No one was ever rejected for being too boring."

The famously rejected

Co-op board silence on rejections has not prevented the gossip mill from

churning, as author Steven Gaines illustrates in his book "The Sky's the Limit:

Passion and Property in Manhattan."

Gaines' list of celebrity real estate smackdowns includes:

Richard Nixon

1979

19 E. 72nd St.

Initially approved by the board, the disgraced president withdrew his offer

after residents rebelled. Nixon then tried to buy a condo - where there would

be no board to turn him down - but withdrew after a group of residents sued to

bar the sale. The condo owner, Democrat millionaire developer Abe Hirschfeld,

refused to refund the humiliated Nixon's $92,500 deposit.

Gloria Vanderbilt

1980

River House,

435 E. 52nd St.

Flush with success from her new line of jeans, the mother of newsman Anderson

Cooper tried to buy a co-op in the River House. Vanderbilt sued. The board

zinged her back by disclosing that her cash assets were not the $7.6 million

claimed in her application but $215,000. Vanderbilt dropped the suit.

Calvin and

Kelly Klein

1986

The San Remo,

145 Central Park W.

According to Gaines, who also has written a biography of Calvin Klein, "Calvin

and Kelly were rejected because The San Remo was afraid they'd throw wild

parties." The Kleins wanted to buy the apartment of Robert Stigwood, the

producer of "Grease" and "Saturday Night Fever." In the mid- 1980s, The Kleins

became the second famous couple rejected by a co-op board. Madonna and Sean

Penn, who were briefly married, were rejected in 1985.

Mariah Carey

1998

Ardsley,

320 Central Park W.

Looking to buy Barbra Streisand's co-op, Mariah Carey met the board in bare

midriff, a style she favored at the time, surrounded by three bodyguards who

she insisted stay for the interview. A board member trying to be hip confused

rap impresario Puff Daddy (Sean Combs) with the then recently slain rapper

Biggie Smalls and asked "if Mr. Biggie might be visiting the building?" Carey

is said to have replied, "Mr. Biggie, he be dead."

Antonio Banderas

and Melanie Griffith

2005

The Dakota, 1 W. 72nd St.

The film-star couple were turned away on paper. The Dakota, Gaines notes, is a

fickle building that has welcomed showbiz residents such as Rex Reed, John

Lennon and Leonard Bernstein, but rejected Billy Joel and Cher. - D.Z. Stone

In meeting the board, less is more

Interviews can range from informal to a formal 'hot' seat. Jacky Teplitzky

offers the following interview pointers:

Prepare for a lack of privacy

Know your application

Couples should decide in advance who will answer which questions

Dress-up and be prompt, as you would for a job interview

Unlike a job interview, do not try to sell yourself

Never volunteer information or engage in unsolicited conversations except for

basic cordial remarks and greetings

Do not ask questions - save these for your broker

Be prepared to answer questions on proposed renovations

Do not expect an answer at the end of the meeting

Remember, a short interview is better than a long one - D.Z. Stone

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