Pros & Cons
There are many pros and cons to weigh when deciding whether to buy or lease a co-op. Here is look at some of the overarching issues one should consider:
- The main advantage of purchasing a co-op is that they are often cheaper to buy than a condo.
- Co-ops are typically more financially stable.
- The instance of foreclosure is rare.
- Co-ops are typically going to be a higher owner occupancy rate.
- You can typically get better square footage for your money.
- Most co-ops require a 10 to 20 percent down payment.
- The rules for renting your co-op are often quite restrictive.
- Because there are a limited amount of lenders who do co-op loans, your loan options are restricted.
- Typically it is harder to rent your co-op with the restrictions that most co-ops have.
If you are trying to rent a co-op it is harder to do a shorter amount of time with the approval process. If you are looking to buy a home as an investment property that you plan to rent, then buying a co-op is probably not the right property to choose. If you need to rent a home in two to three days or sooner, a co-op is not going to be the best choice.
But if you are looking for a primary home that you would like to live in for several years, a co-op can be a wonderful option.
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