In a cooperative, the occupant holds:
Correct Answer
D) Shares in the corporation and a proprietary lease
Why this is correct: In a cooperative (co-op), a corporation holds the fee simple title to the real estate. The occupant owns shares in that corporation and receives a proprietary lease for a specific unit. This is the defining legal structure. Why the other choices are wrong: A life estate is a possessory interest for a person's lifetime, not typical for co-ops. Fee simple title to the individual unit describes a condominium. An undivided fee interest in the whole building describes a tenancy-in-common, not a co-op. Exam tip: Co-op = Shares + Lease. Condo = Fee Simple to Unit + Share of Common Elements.
Why This Is the Correct Answer
Why this is correct: In a cooperative (co-op), a corporation holds the fee simple title to the real estate. The occupant owns shares in that corporation and receives a proprietary lease for a specific unit. This is the defining legal structure. Why the other choices are wrong: A life estate is a possessory interest for a person's lifetime, not typical for co-ops. Fee simple title to the individual unit describes a condominium. An undivided fee interest in the whole building describes a tenancy-in-common, not a co-op. Exam tip: Co-op = Shares + Lease. Condo = Fee Simple to Unit + Share of Common Elements.
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