In June 2019, New York State passed a sweeping reform of landlord/tenant laws called the Housing Stability and Tenant Protection Act (“HSTPA”). The blanket reforms of the HSTPA, whether intentional or not, included New York Cooperative apartments since Co-Op apartments create a landlord/tenant relationship by virtue of the proprietary lease between the Cooperative Corporation (landlord) and Shareholder (tenant). We have previously documented the consequences for landlords who fail to follow the HSTPA and our proprietary platform RezCue which assists with HSTPA compliance obligations, in a prior update available HERE. By being included in the HSTPA reforms, notoriously tough New York Co-Ops lost some of their power over prospective and current shareholders. Now New York Co-Op’s have their “teeth” back by virtue of S-5105(C). Under S-5105(C), which was passed by the New York State Assembly and Senate on June 10th and signed by Governor Kathy Hochul on December 23rd, Co-Ops now have been carved out of certain requirements of the HSTPA as follows: Co-Ops may collect more than one month’s maintenance as security (a protection previously available to Co-Op’s for purchasers who may not have the strongest financials when applying for their Co-Op board approval). However, all other landlords may still not collect more than one month’s rent as a security deposit. Co-Ops may charge up to 8% of the monthly maintenance as a late fee. Previously late fees were capped at $50 and is still capped at $50 for all other landlords. Co-Ops may charge fees for conducting a background and credit check as well as processing fees by a managing agent/transfer agent, while all other landlords have application fees which are capped at $20. Text of the law is available HERE If you would like to discuss your specific circumstances or more information about RezCue, please feel free to contact us at (212) 625-8505. |
