[billlaur]

Does the bond interest rate change at all during its term? Is it a fixed rate for lenght of loan?

[villagetinker]

I believe this is a fixed rate (the reason I paid ours off), however you can call District Customer Service to get to the correct party to give you the exact answer, as there is a possibility different bonds have different terms. Ours was fixed at around 6%, way too high especially this is not tax deductible.

[retiredguy123]

It is a fixed rate for the entire term. But, other properties may have a different interest rate, based on the market when the bond is initiated.

[biker1]

It could change as some CDDs have refinanced their bond. However, it probably won't change.

Originally Posted by billlaur

Does the bond interest rate change at all during its term? Is it a fixed rate for lenght of loan?

[retiredguy123]

Originally Posted by biker1

It could change as some CDDs have refinanced their bond. However, it probably won't change.

If the CDD refinances the bond, I don't think it will change the current property owner's amortization schedule or their interest rate. It could affect new property owners interest rate.

[biker1]

You know that for sure? The bond follows the house. Why wouldn't the property owners benefit from a refinance of the bond?

Originally Posted by retiredguy123

If the CDD refinances the bond, I don't think it will change the current property owner's amortization schedule or their interest rate. It could affect new property owners interest rate.

[biker1]

The interest rates vary as the CDDs were developed at different times. They are all 30 year amortizations, as far as I can tell. The terms for each CDD are available on districtgov.org.

Originally Posted by villagetinker

I believe this is a fixed rate (the reason I paid ours off), however you can call District Customer Service to get to the correct party to give you the exact answer, as there is a possibility different bonds have different terms. Ours was fixed at around 6%, way too high especially this is not tax deductible.

[retiredguy123]

Originally Posted by biker1

You know that for sure? The bond follows the house. Why wouldn't the property owners benefit from a refinance of the bond?

No, but The Villages publishes an amortization schedule for every property, and I have not received any notice that this schedule is anything but a payback schedule based on a fixed rate loan. If they want to reduce the payments, that is fine with me, but I don't see any reason or obligation for them to do so. They definitely could not increase the interest rate. I could understand the CDD refinancing the bond, and pass the savings on to future buyers. My opinion.

[biker1]

As I stated previously, some CDDs have refinanced their bond (to a lower interest rate, they wouldn't refinance to a higher rate). I am assuming they passed the savings onto the residents and modified the amortization schedule. I could be wrong. My CDD (10) has not refinanced. I believe it was some of the more northern CDDs that refinanced. The rate on my bond wasn't that high, 5.25% IIRC. I did pay it off upon settling on the house. In retrospect, it may have been better to put the money in equities. I wrote a check for $20K and don't have a $1600 line item on my tax bill. It is what it is.

Originally Posted by retiredguy123

No, but The Villages publishes an amortization schedule for every property, and I have not received any notice that this schedule is anything but a payback schedule based on a fixed rate loan. If they want to reduce the payments, that is fine with me, but I don't see any reason or obligation for them to do so. They definitely could not increase the interest rate. I could understand the CDD refinancing the bond, and pass the savings on to future buyers. My opinion.

[retiredguy123]

Originally Posted by biker1

As I stated previously, some CDDs have refinanced their bond (to a lower interest rate, they wouldn't refinance to a higher rate). I am assuming they passed the savings onto the residents and modified the amortization schedule. I could be wrong. My CDD (10) has not refinanced. I believe it was some of the more northern CDDs that refinanced. The rate on my bond wasn't that high, 5.25% IIRC. I did pay it off upon settling on the house. In retrospect, it may have been better to put the money in equities. I wrote a check for $20K and don't have a $1600 line item on my tax bill. It is what it is.

You are correct. After 10 years the bond will be evaluated, and possibly refinanced to a lower rate. In that case, the property owners will get a revised amortization schedule that will be based on a lower interest rate. This is according to The Villages bond assessment office.

[retiredguy123]

Originally Posted by billlaur

Does the bond interest rate change at all during its term? Is it a fixed rate for lenght of loan?

I thought it was fixed, but it is not. It could go down if the bond is refinanced. See Post No. 10.

[Mortal1]

, James Bond

[DAVES]

Originally Posted by billlaur

Does the bond interest rate change at all during its term? Is it a fixed rate for lenght of loan?

If, you have a mortgage, you can ask your bank. If, not the Villages offices can tell you who to call. It is not the same on all properties. Does it make sense to pay it off, like most things it is endless debate. Some will say you will not recover it, if you pay it off. My view, on a resale one has a paid off bond the other ??? nicer landscaping-both have value and the seller or salesperson needs to understand and explain it.

For all, it depends. Where would the money come from and what is that money producing for you now. It is not a reversible decision. You cannot pay off the bond and then decide you want to put the bond back on your property. The bond as an investment. Check it out. It has changed. You could at one time buy the bonds, the interest was tax free and the bond is secured by a home in the villages. I believe the bonds were called and it is no longer tax free to the bond holder.

[DAVES]

Originally Posted by retiredguy123

You are correct. After 10 years the bond will be evaluated, and possibly refinanced to a lower rate. In that case, the property owners will get a revised amortization schedule that will be based on a lower interest rate. This is according to The Villages bond assessment office.

Confusing to say the least. Interest rates are currently very low. I expect the supplied information that a new bond has a clause to renegotiate interest in 10 years, is correct.
It could well go up in ten years. My view. Mortgage was 3.5%, It is lower now. Bond is/was roughly 20,000 at 5%. If, that money/cost was in the house, the interest would have been 3.5%. Would you would we have bought our home for 20,000 more than we paid?

[DeanFL]

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We got another 'reminder', when getting our tax bill, to check out the bond etc.

Our bond (district 9) is about $20K. Decided to NOT pay it off early. Bought new house in 2015, so 6 years paid already.

Reviewing the online ammort schedule, over the 29 years life of the bond - the total INTEREST paid would be MORE than the net bond$$$. Approx $20K Principle and $21K Interest. Rate is 5.507%.

So back in 2015, for us, it made sense to NOT pay the bond...at that time. NOW, we will pay off the bond.
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