Co-op Mortgage

As New York City’s best co-op loan specialist, we explain what you need to know about purchasing a co-op. With over 28 years of co-op financing experience, GuardHill is well equipped to help you navigate the co-op market and board requirements to make your dream home become a reality.

What is a Co-op?

A co-op (also referred to as housing cooperative) is a type of residential housing in which a cooperative group or corporation owns the real estate building(s) and sells shares (units) to the residents of the community. A co-op resident does not own the unit they live in. Instead, they own shares in the corporation that owns the building(s). Owning shares grants you access to live in the unit you wish to purchase.


What are the Co-op Loan Requirements?

There are some additional requirements to purchase a co-op unit and get a co-op loan.

Complete a Co-op board application
The application may ask questions about your employment and income and reasons for living in the building.

Complete a Co-op board interview
The Co-op board interview will help the board determine if you are a good fit to live in the community. The interview may be in person or via a video conference.

Submit Character References
These references are written letters from people in your personal and professional network. They help the Co-op board better understand your personality.

Submit Financial Documents
The Co-op board will review your employment history and income documents, as well as your credit and asset information. The board will want to ensure that you have a steady job with a stable income and have enough assets to afford the unit’s payments.


What are the Steps in the Co-op Loan Process?

Although the steps may vary depending on the Co-op board’s specific requirements and the lender’s guidelines, the following are common steps in the co-op financing process.

    1. Get Pre-Approved
      1. Speak with a mortgage lender to determine what you can afford. This will help you narrow down your property search and will make you appear as a more competitive buyer.
    2. Find a Property
      1. Search for Co-op buildings in your desired location. We recommend working with a realtor who has experience in the Co-op market.
      2. Begin the Co-op Board Application and Interview Process
      3. As mentioned above, you will need to complete a board application and interview to see if you are the community’s right fit. Once you are approved, you may continue to the next step.
    3. Complete your Co-op Loan
      1. Like how the Co-op board must approve you, the mortgage lender must approve the Co-op building itself. The lender will contact the building’s managing agent to request necessary financial information to review the building’s economic history and strength.


Additionally, the lender will complete the underwriting process to issue your loan approval. You will need to submit documentation to the mortgage lender, such as pay stubs, photo ID, and tax returns.

How is a Co-op Different Than a Condo?

A Co-op typically attracts more permanent long-term residents. Co-ops enforce stricter guidelines regarding subletting, renovations, and more. Typically, a Co-op is less expensive than a condo. There is no interview or approval process for purchasing a condo unit, whereas all the Co-op residents have been selected to live in the building. This may lead to a more tight-knit residential community.


Why Choose GuardHill?

GuardHill has over 29 years of mortgage financing experience and specializes in providing standard and out-of-the-box financing solutions for our customers. GuardHill works with numerous investors and lenders and offers various loan programs to provide borrowers with the best financing solutions possible.