Definition of master mortgage loan

the mortgage debt existing on a building used for cooperative housing. While each co-op tenant-shareholder is obligated for a portion of the loan, this debt is separate from the loans that may have been used to purchase the individual co-op shares.

Example: When the Morgans bought a co-op apartment, they became co-mortgagors in the master mortgage loan that was used to buy the building by the co-op organization. They are allowed to deduct a prorated share of mortgage interest on their federal income tax return.