Humber/Ontario Real Estate Course 2 Exam Practice

Which statement about an equity housing co-operative is accurate?

1. A unit in an equity housing co-operative is easily financed.

2. A buyer seeking financing for an equity co-operative unit would obtain a mortgage for that unit, similar to a condominium buyer.

3. A mortgage on an equity co-operative is typically a blanket mortgage.

4. A unit in an equity co-operative must be purchased with cash, as mortgage financing is not arranged.

The correct answer is: A mortgage on an equity co-operative is typically a blanket mortgage.

In an equity housing co-operative, the accurate statement is that a mortgage on an equity co-operative is typically a blanket mortgage. This means that the co-operative corporation takes out a mortgage on the entire property, rather than individual unit owners obtaining mortgages on their specific units as with condominiums. This distinction is important because it affects how financing is structured and the potential liability of individual unit owners.