There are two things co-op boards look for:

1.  Good neighbors
2.  The ability of a prospective buyer to meet his/her financial obligations

A co-op board has the right to turn down a potential buyer without giving a reason.  The law bars discrimination only on the grounds of race, creed, color, age, sex or national origin. “Passing the board” may loom as a potential ordeal because, indeed, there is a degree of mystery and a distinct one-sidedness to the ”passing” part.  But, in fact, boards are made up of shareholders whose main interest, like yours, is to keep the building a pleasant and financially sound place to live.

The Process
In general, applications (obtained by your broker or from the building’s managing agent) consist of a personal questionnaire (education, list of family members, pets, musical instruments, etc.) and a financial statement (assets and liabilities, income and employment information).  Reference letters (professional, personal, bank, landlord) and proof of all financial representations (bank and brokerage statements, leases, sales contracts, etc.) are usually required. 

Most boards strive to make prospective shareholders as comfortable as possible and conduct interviews in a cordial, businesslike way.  In many cases, the scheduling of an interview is a sign that the committee is already satisfied with the paperwork submitted by the candidate.

Interviews are usually conducted with the applicant after the application has been reviewed by the board.  Some boards set up interviews as the need arises; some meet only at their regularly scheduled board meetings, usually once a month.  Sometimes there is an admissions committee; sometimes the applicant meets with the whole board.  Many boards want to meet everyone who intends to live in an apartment and, possibly, their pets. 

Be prepared for a certain lack of privacy, and remember that other shareholders, including the interviewers, have been through the process too.  The board, which consists of shareholders who are willing to take on this time-consuming and relatively thankless job, has a responsibility to all the building’s shareholders to keep the building functioning smoothly.  This includes choosing new neighbors who will adhere to the rules and regulations and co-operate in making the building a pleasant place to come home to.

Co-ops don’t like home businesses that put a strain on the building’s facilities.  Many will not allow “live-work” situations at all; many will not permit a business with several employees or daily visitors; some limit the types of businesses.  A free-lance writer may occasionally have a messenger come to the door; a therapist or voice teacher may have a steady stream. 

Musicians who practice at home may attract noise complaints from neighbors.  Many co-ops reject applications from musicians who do not have studios outside their homes.  If you are an amateur musician, and if the subject is raised by a board member, stress that you will carpet, sound-proof, keep windows closed or do whatever it takes to avoid bothering your neighbors.  Also offer that you will abide by whatever hours the proprietary lease sets out.  It is easier to reject an applicant than to correct a noise problem after a shareholder moves in.  If your child takes up the drums after you are living in the building, expect to be asked to do some soundproofing.

Tips for your Interview and Application
 

• Your application should be neat and clean, free of cross-outs or messy  erasures.  It should be easily legible.  Type it if possible.  Answer every question or indicate that it is not applicable. Proofread your application to be sure it is correct and that the board will be able to find easily all the information it has asked for.   Ask your real estate agent to look over it for any “red flags” and to be sure it is easily understood.
• Code financial information to the material that supports your figures so the board can verify them easily.   A bank statement, for example, may contain savings and checking account balances as well as money market accounts.  Brokerage statements may show liquid stocks as well as IRA’s.  There are often different lines in the financial form for each of these categories.  Circle the amount (don’t use a highlighter because photocopies will be hard to read) on the statement.  Number your backup material and, on the assets and liabilities statement, indicate the numbers of the statements which make up the figure you have entered. 
• Reference letters should be on headed note paper or letterhead, addressed to the Co-op Board or Admissions Committee.  They should mention the length of your relationship and give examples of how the writer has reached certain conclusions about you. Personal references should be from personal friends, business references from professional contacts who have known the applicant well for a number of years. If you have a pet, include letters touting his good behavior and quiet, pleasant disposition.  If he has had obedience training, include the graduation certificate.  Aggressive or barking dogs are not popular in apartment buildings.  Some buildings have rules about the size of dogs they accept. References from public figures such as politicians or celebrities may raise the prospect of publicity or controversy. References from shareholders and/or board members in other cooperatives mentioning how much they would like to have you in their co-ops are excellent.   Remember that co-op means cooperative, and that’s what the Board will expect from you.
• Get your questions answered before you meet the board.  Your sales agent should help you with this.  Don’t offer opinions about building issues you may know of or which the Board may bring up.  Answer graciously all questions asked of you, but don’t volunteer information.  Refusal to answer a question is often a red flag that you will not be willing to cooperate once you are in the building.  Praise the building.
• Dress in dignified and conservative clothing.  Do not smoke or request an alcoholic drink. 
• Volunteer to serve on one of the building’s committees.  Don’t volunteer for the Board (it’s possible no one is ready to retire yet) but express willingness if asked.
• Don’t talk too much; resist the urge to joke or be flippant.
• Try to imagine the type of answer you would like to hear if you were talking to a prospective neighbor.