What serves as a lender's collateral for a loan to purchase a cooperative apartment?

A lender's collateral for a loan to purchase a cooperative apartment is the share of stock and the proprietary lease. In a co-op, when you buy an apartment, you are actually purchasing shares in a corporation that owns the building. The shares grant you the right to occupy a specific unit, and the proprietary lease outlines your rights and obligations as a shareholder and tenant.

This structure is different from traditional real estate transactions, where real property is directly secured by a deed and mortgage. In the case of a cooperative, the lender places a lien against the shares and the proprietary lease instead. If the borrower defaults on the loan, the lender can take steps to recover the owed amount through these assets.

The other options suggest forms of collateral that are not applicable in the context of cooperative apartments, highlighting the unique nature of co-op ownership and financing.