Quote:
Originally Posted by Stu from NYC
Thank you so much for the insight and info.
Understand there is very little reason for the homeowner to pay off the bond early. I believe we were given the discount info when we moved in but do not remember. By any chance does anyone know?
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It is very complicated. There is no discount for the principal amount of the bond. The interest is calculated against the loan on October 1 for an entire year in advance, but it is paid to the lender in two equal installments. For homeowners, if you pay off the bond by September 16, you will save a year of interest. If you pay off the bond after September 16, but before March 21 of the next year, you will save 50 percent of the annual interest. If you pay off the bond after March 21, you will still pay the entire annual interest amount. The bond also has an administration charge. If you pay off the bond by July 17, you will eliminate the administration fee for a year. There is no proration of the administration fee. You cannot make partial payments of the principal. I "think" I got that correct.