Do I Qualify To Buy A Co-op or A Condo

Since I sell so many co-ops and condos I am always faced with the statement, "I'm not sure if I should buy a co--op or a condo." The fact is, these two types of properties are very different when you go down the list of qualifications to purchase.


Most people don't have a choice between the two because of the requirements for each. Below I will share with you some of the information I share with my buyers.


BASIC QUALIFICATIONS FOR PURCHASING A CO-OP
- PRICE
The price of a co-op is usually much less than a condo


Below is an example of someone wanting to buy a two bedroom unit, but doesn't know if they meet the requirements to buy a co-op or a condo:


-For Co-ops: and your mortgage will automatically be lower than if you purchased a condo in the same area. So if your're mortgage broker pre-approves you for a two bedroom co-op ranging from $200,000 to $225,000 then you cannot go out and get a two bedroom condo that would most likely be $299,000 to $350,000, unless you plan to put down a HUGE down payment so your loan amount is less.


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*DOWN PAYMENT


-For Co-ops: Most co-op buildings require between 10-20% down depending where you live.


-For condos: Lenders usually require a 20% down payment, but some condo complexes are FHA approved and you may only have to put down 3.5% (simply ask your lender if the conod complex you're interested in is on the F.H.A approval list).
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- Credit Score - Lenders are usually pretty strict when it comes to co-ops, so you need to have good credit.


- Income - If the buyer needs a two bedroom, to purchase a co-op the buyer will need to earn at least $80,0000. All the income must be verified with stubs and tax information.


As a buyer looking into purchasing a co-op or a condo you should look at the two scenarios above very carefully. Looking at the requirements for each, it's pretty easy to know up front which one a you qualify for.

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