We are looking at this exact situation: buying an SRO and converting to a single family, maybe with one rental on ground floor. We are calling our mort. broker today and r.estate attny.

But, can anyone here give an estimate of how long the wait is, and how much we can expect in fees from the DOB and lawyer? i.e. Is it worth it? We love the bldg and don't mind the wait at all--even if it takes 6 mos to a year. Just concerned about the fees. Will this affect when we can get the mortgage?

Posted by: aroundtheblock at March 7, 2008 8:52 AM in response to converting SRO to 1-2 fam

We didn't buy it yet. Just doing the research. Interesting to hear your experiences so far.

Posted by: aroundtheblock at March 7, 2008 6:06 PM in response to Converting SRO to 1 family: what is certificate of non-harassment?

This is very helpful--thank you. When you went to contract awaiting the certificate, was much of your money tied up for a full year? i.e. What are the financial risks involved when doing this? Or is it more the time factor, that you have to wait for all of it to go through. The time doesn't bother me. The money being tied up might...

Did you have trouble getting the seller to do the paperwork and hire a lawyer to help? Are they required to? We are working with a real estate broker and have not had direct contact with the seller (probably because we haven't made an offer yet).

Posted by: aroundtheblock at March 10, 2008 3:58 PM in response to Converting SRO to 1 family: what is certificate of non-harassment?

We do not own it--we are looking at it. It is vacant and we do not have a cert. of non-harassment yet. I was not aware of the rehab loan option. Is it the same as a construction loan for the most part?

Posted by: aroundtheblock at March 12, 2008 5:09 PM in response to bank to finance SRO to 1 family conversion?

Great to have the name of Mr. Kossow and the tip on Wells Fargo.

Thanks also for the definition of contruction loan.

Posted by: aroundtheblock at March 14, 2008 8:05 AM in response to bank to finance SRO to 1 family conversion?

A certificate of non-harassment is issued by the buildings department and is a complicated process. First you have to file, with documentation, then you have to publish notice to see if any comes forward. After that it still takes a few months. We went to contract on a house awaiting the certificate. All in all it took a full year to get it done. Make sure your seller does the paperwork and hires a lawyer to help. You don't get a mortgage for an SRO, even with a certificate of non-harassment. What you can get is a construction loan, because you are basically buying a commercially- zoned building and then converting it to another use. We used Wells Fargo for our construction loan. Good luck.

Posted by: guest at March 8, 2008 10:56 PM in response to Converting SRO to 1 family: what is certificate of non-harassment?

This is very helpful--thank you. When you went to contract awaiting the certificate, was much of your money tied up for a full year? i.e. What are the financial risks involved when doing this? Or is it more the time factor, that you have to wait for all of it to go through. The time doesn't bother me. The money being tied up might...

Did you have trouble getting the seller to do the paperwork and hire a lawyer to help? Are they required to? We are working with a real estate broker and have not had direct contact with the seller (probably because we haven't made an offer yet).

Posted by: aroundtheblock at March 10, 2008 3:58 PM in response to Converting SRO to 1 family: what is certificate of non-harassment?

Construction loans are actually "new" construction or "rehab" loans. They are the same thing as far as I know and most banks have canceled these products. I was told that at this point SROs are only being bought by investors who have cash to pick them up and carry them through the long profitless build out stage and conversion to 1-4 family. Then they can be sold to end-users like you and me. Banks are forcing us into waiting for the middleman to self-finance and then take their cut when they sell to us.

Posted by: guest at March 12, 2008 5:35 PM in response to bank to finance SRO to 1 family conversion?

Hi, we got a construction loan for an SRO with the non-harassment certificate from Well Fargo, our banker is David Kossow. It was not particularly difficult and we a renovating a 5,000 square foot house into a single family with an accessory apartment.

Also, another friend of mine did the same thing for a house that was not an SRO but had been used commercially on one floor.

Good luck.

Posted by: guest at March 12, 2008 9:58 PM in response to bank to finance SRO to 1 family conversion?

Great to have the name of Mr. Kossow and the tip on Wells Fargo.

Thanks also for the definition of contruction loan.

Posted by: aroundtheblock at March 14, 2008 8:05 AM in response to bank to finance SRO to 1 family conversion?

9:58 --I've tried to find David Kossow's number on google and couldn't find him anywhere. We're considering a gorgeous SRO with a cert of non harrassment but I need info on loans and how long it might take to get a permit to do the work. Any suggestions?

thanks

Posted by: guest at May 5, 2008 5:40 PM in response to bank to finance SRO to 1 family conversion?