Sarah Martinez is purchasing a co-op apartment in Manhattan for $750,000. Her lender explains the financing structure for cooperative units. What type of loan will Sarah receive for this co-op purchase?
Correct Answer
C) A share loan secured by the cooperative shares and proprietary lease
Co-op financing in New York involves a share loan (also called a co-op loan) because the buyer is purchasing personal property (shares in the corporation) rather than real property. The loan is secured by the cooperative shares and the proprietary lease, not by real estate.
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