What is the definition of post-closing liquidity and why does it matter in New York City? If you are buying a co-op apartment, post-closing liquidity is one of the co-op financial requirements which the board will review as part of the co-op board application process. So, what is post-closing liquidity? Post-closing liquidity is the amount of liquid funds a buyer will have once the down payment and buyer closing costs are paid at closing. Post-closing liquidity forecasts how many months’ or years’ worth of apartment carrying costs you will have readily available in liquid assets after you close on your apartment. For example, if you have 24 months of post-closing liquidity it means that you have enough liquid assets to pay the monthly co-op maintenance and mortgage bills for 24 consecutive months. It’s important to note that the definition of ‘liquid assets’ varies by co-op. While some buildings may allow a buyer to include vested 401K or IRA assets, other buildings will only allow cash or cash equivalents to be counted towards post-closing liquidity. What is the typical post-closing liquidity rule for co-ops in NYC? A typical New York City co-op will expect buyers to have at least one to two years in post-closing liquidity. Before submitting an offer on a co-op, it’s important to have your buyer’s agent confirm the co-op’s financial requirements. If a building does not specify its post-closing liquidity requirements, a conservative rule of thumb is to have at least two years of post-closing liquidity. Even if the managing agent won’t share the building’s financial requirements, your buyer’s agent may still be able to find out which types of assets the board will count as ‘liquid assets.’ What qualifies as liquid assets when calculating post-closing liquidity? The definition of ‘liquid assets’ is open to interpretation and varies by co-op board. As a general rule of thumb any asset which can be converted to cash in 24 hours is considered ‘liquid.’ Examples of liquid assets include: cash, CDs, stocks and bonds Examples of illiquid assets include: unvested retirement accounts, pensions, real estate and deferred compensation An experienced buyer’s agent can help you research and accurately determine the board’s specific financial requirements for the building you are interested in. A seasoned buyer’s agent will also know how to clearly and convincingly present your financials to a co-op board in your purchase application. Better yet, you can save thousands and reduce your closing costs by requesting a Hauseit Buyer Rebate on your purchase. Requesting a Hauseit Buyer Rebate is a legal and non-taxable way to discreetly save money while also receiving top-notch buyer agent representation throughout your purchase. Because our partner brokers don’t openly discount, you can be assured that requesting a rebate won’t result in the seller or listing agent treating you differently. To request a Hauseit Buyer Rebate, visit www.hauseit.com.