A mortgage to purchase a co-op differs slightly from a standard mortgage. When you buy into a for-profit co-op you are buying shares in a corporation and the corporation owns the property. What that means in real terms is that the lender is loaning against the value of shares versus a mortgage where the lender is loaning against the value of the subject property. The result is that a select few lenders choose to loan in the co-op niche and their co-op mortgage lending policies differ slightly from those who mortgage conventional properties. Generally, a co-op lender will loan to a maximum of 60% of the value of the unit shares, which means a 40% down payment is required. Also a co-op mortgage will have a maximum amortization period of 25 years.
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