WHAT IS A COOPERATIVE?
and how it works at Gramercy Park IGH
Cooperative housing combines the advantages of home ownership with the convenience of community living.
Although there are different types of cooperatives, all have certain principles in common such as joint ownership of the property.
The key to Gramercy's success is democracy in action and fiscal responsibility. Members have equal voting status in electing a Board of Directors. The Board decides all policy and budget matters and determines the level of oversight, accounting and legal expertise that is required.
At Gramercy Park Cooperative, each member purchases a share in their own common-interest corporation. These shares provide the equity necessary for the corporation to secure a mortgage.
Unlike a condominium, where each buyer must qualify for and obtain individual financing from
a variety of lenders, the cooperative has one mortgage with payments and operating expenses shared by all members.
Gramercy Park Cooperative was built
to provide affordable senior housing. This non-profit corporation holds an FHA insured mortgage. FHA requirements mean each cooperative must conform to rigorous quality, operational, and financial standards.
The cooperative holds title to the property, assuming mortgage and tax obligations and relieving members of direct liability for these items. Members support the
cooperative through their occupancy agreements, membership share purchases and monthly fees.
Under State and Federal law, cooperative members are homeowners, entitled to deduct a proportionate amount of the building’s mortgage interest and real estate taxes from individual tax returns.
Cooperative housing has been successful because it creates an “owner attitude” among members who
take pride in their property as well as in directing the affairs of the community.