[The20Percent]

Originally Posted by outlaw

You may want to check with your bond broker. I was looking at villages bonds also. Here is what I found: Most of the bonds have a date far out; yours may be 2030, 2040, 2050. There is also a callable date of maybe 2020 or something like that, when the bond can be called anytime after that date. There is also a provision in most, but not all, of these bonds that allows the bond to be paid off much sooner, even as early as six months or less after you purchased it. It's called something like "extraordinary circumstance", or something like that. Basically, whenever enough people pay the bond off, several of the bonds are called in and paid off. The risk is that if you paid a premium for the bond, which you probably did, then you could lose money if it is paid off in six months, or three months, or whenever, but you can calculate when you would break even. That's the way I understand how these bonds work. If you don't specifically ask the broker about this possibility of early payoff, they may not tell you. I had to talk to a bond broker at USAA to find this out.

Yes, your pretty much correct. Even though my district 11 bonds have a maturity of 2045, Village bonds are always paid off sooner. I bought them knowing they would most likely be paid off in full in 10-15 years. I don't see there being any risk for them being completely paid off in only a few short years though. As you said, when enough people pay off their bonds in a district, the money is divvied up, split and distributed to all the bond investors of that particular district. I have only had this happen once when I was reimbursed only a small amount ($2k) of my initial investment back from some older district 6 Village bonds which I had purchased a year ago.