NY Real Estate Co-ops and Condos Practice Questions

Correct answer: B — A stock certificate and a proprietary lease

In a cooperative, the buyer does not own real property. Instead, they own shares of stock in the cooperative corporation (evidenced by a stock certificate) and receive a proprietary lease giving them the right to occupy a specific unit. There is no deed and no traditional real property mortgage in a co-op purchase.

Correct answer: C — Condo owners hold fee simple title to their unit and an undivided share of common elements

A condominium owner holds fee simple title (real property) to their individual unit and an undivided interest in the common elements. This is conveyed by deed. A co-op owner holds personal property (shares + proprietary lease), not real property. Common charges in a condo do NOT include property taxes — condo unit owners pay their own real estate taxes separately.

Correct answer: B — The owner's proportionate share of the building's mortgage and real estate taxes, plus operating costs

In a co-op, the monthly maintenance fee covers the building's operating expenses AND the shareholders' proportionate share of the underlying building mortgage AND the building's real estate taxes. This is fundamentally different from a condo's common charges, which cover operating expenses but NOT the unit owner's individual taxes or mortgage.