Is it possible to circumvent a co-op's 20% downpayment requirement?

Look for a condo!

yes many mortgage brokers can give you a silent second mortgage you need to talk to a mortgage broker

mcfm85a, how does a 'silent second mortgage' work? and how would it get past the coop board?

The down payment requirement all depends on what the coop board requires. Buying a coop you're buying shares in a company that entitles you to occupy your apt. the reason why coops require 20% is to ensure that all shareholders are in stable financial shape...this is because in the event you default on your mortgage/maintenance the remaining shareholders will have to pick up the slack. And this would therefore decrease the overall value of all units in the building.

if you don't have enough for the down payment you shuld probably stick with a condo, which has less financing restrictions. just be aware that condos more expensive and the closing costs are higher (could be as much as the add'l 10% down payment you could have made on the coop). in which case you may consider saving your $$ until you can afford to buy.

THere are some coops that only require 10% but they are few & far between. Also the low requirement could raise a red flag as to how well the building manages its finances. This may not seem important to you as a buyer but it will once you become a shareholders. good luck!

Also, most coop boards require that you have X month's payments (mortgage plus maintenance) available, in case you lose your income or whatever. The thing that frustrates me to no end is that when doing this calculation, they often disregard your IRA and 401k holdings. Arrgh. That's where I stash my savings, because its tax advantaged!! Bummer.

btw. X is usually equal to 24, in my experience.

I have not seen any coops that allow less than 25% down payment. Many require 50%. Where have you found one for 20%?

do a search on this site. you will find many coops with a 20% down requirement.

Thomas 3425 lots of coops require minimum 20%. I think it depends on the neighborhood...I understand that ones on park ave, for example, require more. But as a buyer those buildings are out of my price range.