A co-op corporation holds title to a co-op project and grants occupancy rights to particular apartments or units to shareholders through proprietary leases or similar arrangements. The co-op interest is the co-op shares or other evidence of an ownership interest in the co-op corporation and the accompanying occupancy rights, excluding the co-op interest’s pro rata share of the debt service of the blanket mortgage. In other words, the co-op interest is the equity portion that is over and above the pro rata share of the blanket mortgage(s).
Note: The lender is required to receive Fannie Mae approval to deliver mortgages secured by units in co-op projects.
|Announcement SEL-2014–03||April 15, 2014|