coop/condo financing
From: Judy (BAXTER%EPIVAXvx.cis.umn.edu)
Date: Fri, 11 Jun 93 10:33 CDT
june 11,'93
Our group (Monterey Cohousing) just outside Minneapolis, MN, is currently a
coop, owning the building that currently houses our common space and 8
in-process apartments.  We basically went coop so that we could get a blanket
mortgage and do equity sharing, so our low-income members didn't have to
qualify separately (we needed a total 30% downpayment on the $330,000 sale
price).  
        It is my understanding that the major advantages of coop are the 
ability to
do a blanket mortgage, and the ability to require approval from the  group 
(Board of Directors) for whoever buys shares.  I.e. more control over
membership.  The disadvantages seem to be difficulty in getting financing and
limited sources of share loans for resale of units and possibly higher interest
rates.
        The disadvantage of condo financing is that it appears (I am quoting 
David
Thompson, a developer type who visited with us recently, very committed to
coops, did some work w/ muir Commons at Davis, ) when push comes to shove, and
someone really wants/needs to sell their property, all the covenants you make
probably can't stop them, and the community can be diluted with people who
really aren't interested in CoHousing. 
        Advntages are : more accepted by banks, maybe easier to get, possibly 
lower
interest rates, financing of resale is more normal.

DOES ANYONE KNOW ANY OTHER COHOUSING GROUPS CURRENTLY USING/PLANNING COOP
FINANCING? WE are moving into phase 2, construction of 10-15 more units, and
will face this same decision again. 

I WOULD ALSO APPRECIATE FEEDBACK ON THE CONDO/COOP ISSUE.

Judy Baxter, Monterey Cohousing Community, Twin Cities Area, Mpls/St.Paul MN
        (Mococo)                baxter%epivax [at] vx.acs.umn.edu

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