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10-26-2015, 08:34 PM
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Gold member
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Join Date: May 2012
Location: Philadelphia & Lower Gwynedd, PA, Ocean City, NJ, Wesley Chapel, FL and The Village of St. James
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Quote:
Originally Posted by Roaddog53
The bond has nothing to do with the price of a house. It is tied to the type of homes as mentioned above for the infrastructure of those homes. For a simple example, to develop the premier section of homes, it may take $4,000,000 in roads, sewers, utilities... They take the number of lots in that premier section and divide by the $4,000,000. Since there are far less lots in premier sections due to the size of the lots, let's say 100 lots, the bond per lot, no matter the size or price of the home on it would be $40,000. They than amortize the $40,000 over so many years (20 years usually) at a given percent at the time to float the bond and that is the monthly payment. Hope it helps.
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Great explanation except they are for 30 years, not 20.
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