The process of buying a condo is just like buying a home. The purchaser owns the apartment outright and receives a deed. The buyer pays a separate tax for their apartment. In addition, there is a monthly common charge that is similar to a co-op’s maintenance fee. Common charges are not tax deductible and do not include your real estate taxes. They are used specifically to cover the buildings maintenance fees.

The monthly combined common charges and real estate taxes for a condo are generally less than a co-op’s monthly maintenance fee, resulting in higher purchase prices. The fact that there are fewer condos on the market and that they are easier to purchase than a co-op also puts them in high demand.

The application process for a condo is simple. An interview with the board is not required because the board cannot reject sales or rentals. Financing for condos is very flexible and usually has the same interest rates as a single-family home. Condos can be financed up to 90% of the purchase price. If a borrower finances 75% of the purchase price or less the bank will not conduct a review of the building’s finances. Banks generally accept condos that are 90% occupied.

Buying a condo is often a smart investment. They are easy to rent/sub-lease and are less expensive to carry with no underlying mortgages. If you’re interested in purchasing a condo, we at Preferred Empire Mortgage will walk you through every step of the financing process, to ensure you get the best loan options to meet your needs.