Mortgage Insurance_Single Family Cooperative Housing

To provide insured financing for the purchase of the Corporate Certificate and Occupancy Certificate for a unit in a cooperative housing project.

Ownership of the corporate certificate carries the right to occupy the unit located within the cooperative project.

Agency - Department of Housing and Urban Development

The Department of Housing and Urban Development's mission is to increase homeownership, support community development and increase access to affordable housing free from discrimination. HUD fulfills this mission through high ethical standards, management and accountability, and by forming partnerships with community organizations.

Office - Persons are encouraged to contact the Homeownership Center serving their State (see or the nearest HUD Office.

See Catalog Address Appendix IV for a list of Offices.

Program Accomplishments

There has been very little activity under this program in recent years.

Uses and Use Restrictions

HUD insures lenders against loss on mortgage loans.

These insured loans may be used to assist individuals or families in acquiring corporate certificates and occupancy certificates in a cooperative housing project that is covered by a blanket mortgage insured under the National Housing Act.

The maximum insurable mortgage loan is limited to the maximum limit under Section 203(b) minus the portion of the unpaid balance of the project mortgage attributable to the dwelling unit.

Eligibility Requirements

Applicant Eligibility

Potential owner-occupant mortgagors are eligible to apply.

Beneficiary Eligibility



Documentation regarding the characteristics of the property and the qualifications of the mortgagor are assembled by the mortgagee and submitted with the application. This program is excluded from coverage under OMB Circular No. A-87.

Aplication and Award Process

Preapplication Coordination


This program is excluded from coverage under E.O.


Application Procedures

Application is submitted for review and approval or disapproval to the HUD Homeownership Center having jurisdiction over the area where the property is located through a HUD approved lending institution. This program is excluded from coverage under OMB Circular Nos. A-102 and A-110.

Award Procedures

See Application Procedure.




National Housing Act; as amended, Section 203(n), Emergency Home Purchase Assistance Act of 1974, Public Law 93-449, 88 Stat. 1364.

Range of Approval/Disapproval Time



HUD will state the reasons for refusing an application. The applicant may reapply subject to concurrence of the lender.


Not applicable.

Assistance Considerations

Formula and Matching Requirements

For most families, the maximum amount of the loan is the same as under 203(b) - program 14.117. The unit's share of the project mortgage is deducted from the maximum potential amount to determine the maximum Section 203(n) loan. As of July 1, 1991, risk-based mortgage insurance premiums will be collected including: 1) an up-front premium which may be financed and 2) a periodic premium which is paid monthly. The origination charge by the mortgagee varies, but may not exceed one percent of the total mortgage amount.

Length and Time Phasing of Assistance

The maximum mortgage term is 30 years or the remaining term of the blanket mortgage covering the cooperative development, whichever is less.

Post Assistance Requirements


Defaults in meeting the mortgage terms must be reported.

Any approved mortgagee, at any time upon request by HUD, must furnish a copy of its latest financial statement.


The Department of Housing and Urban Development reserves the right to audit the account of the mortgagee to determine its compliance and conformance with HUD regulations and standards.


Mortgagees are required to service and maintain records in accordance with acceptable mortgage practices of prudent lending institutions and the HUD regulations.

Financial Information

Account Identification



(Mortgages insured) Reported under program 14.117.

Range and Average of Financial Assistance

See Uses and Use Restrictions.

Regulations, Guidelines, and Literature

HUD 4240.3, Section 203(n) Application Through Insurance (Single Family) no charge; 24 CFR 203.43c and 203.437.

Information Contacts

Regional or Local Office

Persons are encouraged to contact the Homeownership Center serving their State (see or the nearest HUD Office. See Catalog Address Appendix IV for a list of Offices.

Headquarters Office


Criteria for Selecting Proposals

Not applicable.

The Social Incubator North, a £2 million incubator fund spearheaded by Sheffield-based Key Fund in collaboration with the four Northern Social Enterprise Partnerships and Locality, is providing 0% interest loans to North of England’s social entrepreneurs.

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