Expand Your Education with These Courses from
Time Management: Skills for Sales Success: Part Two.
The Psychology of Consultative Selling: Skills for Sales Success: Part Four.
Negotiating Skills: Skills for Sales Success: Part Six.
Bundle 1: CIPS Core Courses (Non-US Version).
Bundle 2: CIPS Elective Courses (US Version).

Real Estate Q&A: Banks Cut Back on Lending for Co-Ops

Have a comment on this article? Share on Facebook!

By Gary M. Singer

declined_rejected_words(MCT)—QUESTION: I bought a co-op apartment unit in January 2010 with a conventional mortgage. I am trying to refinance it and have found that big banks are not willing to work with me. Can you please explain what’s happening here?


ANSWER: When you buy a home in a community, there are several ways that you can own it. In a “fee simple” arrangement, you own the land and home outright and the community association has a lien against the property. You also can own a property through a condominium association. In this arrangement, you own the unit to the interior walls and share ownership in the rest of the building and grounds with all of the other owners in the project.

Finally, there is a cooperative or co-op in which you own stock in the corporation that owns the building and have a long-term lease on your apartment unit. When a bank lends money for a co-op, you give it a lien on your lease and stock certificate. If the lender needs to foreclose, the legal steps are complicated. Also, the resale of the foreclosed unit is extremely difficult for the lender because it needs to get the help of the corporation’s board of directors.

Because of all this, most banks have curtailed lending on co-ops in the wake of the housing bust. Still, there are some specialty lenders that do make these loans. You should be able to find several with the help of an experienced mortgage broker or directly through the internet.

Gary M. Singer is a Florida attorney and board-certified as an expert in real estate law by the Florida Bar. He is the chairperson of the Real Estate Section of the Broward County Bar Association and is an adjunct professor for the Nova Southeastern University Paralegal Studies program.

The information and materials in this column are provided for general informational purposes only and are not intended to be legal advice. No attorney-client relationship is formed. Nothing in this column is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction

©2013 Sun Sentinel (Fort Lauderdale, Fla.)
Distributed by MCT Information Services (http://www.mctdirect.com)

Have a comment on this article? Share on Facebook!

Join RISMedia on Twitter and Facebook to connect with us and share your thoughts on this and other topics.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Copyright© 2016 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

Content on this website is copyrighted and may not be redistributed without express written permission from RISMedia. Access to RISMedia archives and thousands of articles like this, as well as consumer real estate videos, are available through RISMedia's REsource Licensed Content Solutions. Offering the industry’s most comprehensive and affordable content packages. Click here to learn more! http://resource.rismedia.com

Our Latest News >>