Cooperative Housing Loans
Flexible loan terms
Certainty and speed of execution
5 to 30 years
Up to 30 years
Existing stabilized cooperative properties in eligible cooperative property markets
Cooperative corporations with strong management and solid operating history
Limited equity cooperative properties for low- and moderate-income families are also eligible
Overall Property condition rating of two or better
55% (on a market rental basis)
1.0x on actual underwritten operations; 1.55x when utilizing market rate rentals.
The property management company is required to have experience with cooperative properties of like size and market.
Reserve balance must be equal to or greater than 10% of annual maintenance fees.
Maintenance fees must be sufficient to achieve a balanced budget.
High levels of ownership by one sponsor or investor (in excess of 40%) will require additional due diligence.
Supplemental Loans are available.
Loans may be voluntarily prepaid upon payment of yield maintenance.
30- to 180-day commitments. Borrowers may lock a rate with the Streamlined Rate Lock option.
Non-recourse execution is available with standard carve-outs for “bad acts,” such as fraud and bankruptcy.
Replacement reserve, tax, and insurance escrows are typically required.
Standard third-party reports required, including Appraisal, Phase I Environmental Site Assessment and Property Condition Assessment.
Loans are typically assumable, subject to review and approval of the new borrower’s financial capacity and experience.