You are a real asset to this forum. :ho:

I appreciate the useful info posted. Using a bond to finance infrastructure is better that burying the cost into the home value as it's done in other jurisdictions.

Out here in Oregon, those system development costs are hidden in the selling price of a home, and stay with the home forever. New starter homes here in the Portland Metro area start at $400K, with yards that make TV yards seem big.

For my new home purchased in Marsh Bend, the bond was quite clear, and the amortization easy to understand. The interest rate on the bond seems fair, too. Nice to have the option to pay it off at any time.

Excellent post.
 

Originally Posted by Goldwingnut
The developer has no interest in the bond or the collection of the bond assessments. Their interest ended when the construction efforts ended and they were paid for their infrastructure work.

These bonds are managed by the respective CDDs, in your case CDD-9. The bond rates were established by the underwriters when the bonds were issued and it is just like a loan you take out on a car or your home. The P&I paid are determined by the amortization schedule, with the interest paid each year decreasing as the principal decreases each year. Check your mortgage amortization schedule if you have one and you will see it looks the same.

You are not paying interest to The Villages, you are paying it to the bond holders. You may actually have some of these bonds in your investment portfolio.

If you have specific questions about you bond contact the Finance Department at 352-753-0421.

Since you're new to The Villages I highly recommend you attend the Resident Academy. It is a 5 hour class held once per quarter and is free. Go to the districtgov.org to sign up. The class covers may of the areas that new residents, like yourself, do not understand about how and why the community runs as it does. It is time well spent.

Debt bad, Pay it off. You are getting ripped off. Only thing to consider is if you are planning to sell in a few years. Not us....done moving!
If you can't afford the total, get a home equity loan with a lower interest and pay it off. JMHO.

Yep, we figured that out the first time we got our taxes;paid it off immediately ane have enjoyed the savinging since 2010

My husband and I attended the resident academy with the presentation given by Mr. Rohan and there was an additional talk on how to save water when sprinkling your lawn. They did not mention bonds and who the interest is paid to. This might be a good slide to add to the presentation. I would like to be an investor and buy some of these bonds. It is hard to make this type of interest. Does anyone know where I can buy these bonds. I want to get rich quick (LOL).

I called about getting bond at a lower interest rate & was told the developer is only one that can apply for a lower interest rate after 10 years. We got a good rate for our mortgage but are paying almost double interest on bond. You definately are paying interest on bond. We are paying high bonds & now hit with huge increase in taxes for massive Village expansion & seem to have no say in anything.

Some posters have said that the interest rate on the bonds is 7 percent, but it depends on when your bond was originated. My bond was originated in 2015, and the interest rate is only 4.3 percent.

If John Rohan was the primary speaker then you were probably attending the CDD Orientation held on Thursdays at Lake Sumter Landing. The Resident Academy is a much more detailed presentation and is given only once a quarter, last about 5 hours, and has about 250 PowerPoint slides in the presentation. Far more detailed than CDD Orientation.

Not to get too far off topic...I have owned various Villages CDD and Utility bonds for 10 years. They are a good tax-free investment.


When they are initially offered, big institutional investors gobble them up at par value (like the 7% in CDD 9 and 10). Eventually, some come up for resale on the secondary market. The price you pay may be adjusted to reflect current market values. Those 7% bonds might cost you 117 so your effective yield is closer to 4% which is more the going rate. The initial rate is guaranteed for 10 years at which time the issuer (the CDD) can call them in and refinance them at the going rate...which has been done for CDD 5,6,7 and probably 8.



A good reseller is FMS Bonds out of Boca Raton. Edie Nasello, 1-800-367-2663.


To tie back in to the OP, the Developer sets up the initial financing but then the CDD manages the flow in and out from there. The CDD makes the decision to refinance them and lower your bond cost after year 10, if market conditions indicate it is prudent to do so.

The decision to pay off your bond should be based on a number of factors.
Are your investments earning (long term basis) more than the interest rate on the bond? If yes don’t pay
How long do you intend on hanging on to your home? A short time frame generally implies the bond should not be paid.

2016 Bond Interest was 3.9%

https://www.districtgov.org/departme...0Unit%201F.pdf

2018 Bond Interest is 4.3%

https://www.districtgov.org/departme...f%20Villas.pdf

Any idea why is there is a maintenance fee when the bond is paid off? What are they maintaining.? Love to hear a reply.....besides they can..

We paid off our bond last year and we did not see any bond 'maintenance fee' on our new tax bill.

Watch this video for an explanation of the maintenance assessment.

The Villages 6-19-19 Construction Update and Maintenance Assessment discussion. - YouTube

Bottom line is that the Bond paid for the infrastructure to be built and the maintenance assessment pays to maintain some of the infrastructure and keep the community looking nice.