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02-27-2019, 02:04 PM
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Gold member
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Join Date: Aug 2007
Location: NY, FL, PA, TX, NC, TV
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Quote:
Originally Posted by retiredguy123
The bond is a loan that the builder takes out to pay for the infrastructure to support the houses in a particular area. This is the roads, utilities, etc. that are constructed before the houses are built. The loan is distributed among the homeowners. In other areas of the country, a developer will incorporate the infrastructure costs into the price of the houses, and there is no bond. You can make an argument that the bond concept makes more sense because, the houses are cheaper, and, if you only live in the house for a few years, you only pay for a portion of the infrastructure cost that you actually use, and then you transfer the bond to the new owner.
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It also allows the properties to appraise high enough if you need a mortgage. If they added in the price of infrastructure to the price of the house it might not.
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