[Pessemist]

The question you are asking is better rephrased as,

“What’s the total balance left on the Bond on a particular home?”

At the start bonds can be hefty. $20-$40k

Over time that’s paid off just like your mortgage at whatever interest rate was assigned at the time.

No bond means it has been paid off and a zero balance remains.

It’s important to know the balance (if any) on the bond remaining in a home you are interested in. Otherwise you could be in for an unpleasant surprise at the total monthly mortgage/bond you have to fork out.

Each home is unique in amount of their bond balance. Some owners accelerate bond payments or even pay it off early to make the home more attractive when selling it.

So ask

[frayedends]

Originally Posted by Pessemist

The question you are asking is better rephrased as,

“What’s the total balance left on the Bond on a particular home?”

At the start bonds can be hefty. $20-$40k

Over time that’s paid off just like your mortgage at whatever interest rate was assigned at the time.

No bond means it has been paid off and a zero balance remains.

It’s important to know the balance (if any) on the bond remaining in a home you are interested in. Otherwise you could be in for an unpleasant surprise at the total monthly mortgage/bond you have to fork out.

Each home is unique in amount of their bond balance. Some owners accelerate bond payments or even pay it off early to make the home more attractive when selling it.

So ask

More like 20-80k now. Mine in lake Denham was ~48K

[Altavia]

Originally Posted by Bill14564

Let me type this more slowly this time: If the bond is not paid in full in advance then the remaining amount of the bond is directly related to the age of the home. One could say the numbers on a calendar have nothing to do with the age of a home, except that as the numbers get higher the home gets older. Likewise, the balance on the bond has nothing to do with the age of a home, except that as the balance gets lower the home gets older.

"It's a mortgage with a different name, folks. Nothing more, nothing less."
- Except the mortgage is directly related to the value of the home - the bond is not
- Except the mortgage on my home is likely different than the mortgage on my neighbor's - the bond is the same
- Except principal on the mortgage can be paid early - principal on the bond cannot
- Except the mortgage must be satisfied for the home to change hands - the bond does not
- Except I can refinance the mortgage to obtain a better rate - I have no ability to refinance the bond
- Except I can itemize interest paid on the mortgage - I cannot itemize interest paid on the bond

Perhaps you meant to say, "It's a mortgage with a different name... except when it isn't"

There are different ways to think about the bond and some are more correct than others.

So they are the same thing only different?

Does a bond impact your credit score?

[biker1]

I don't believe you can accelerate bond payments. In other words, I don't believe you can make extra payments towards the principal. You can payoff the entire bond whenever you wish but there is a cutoff date to avoid the bond payment on your November tax bill.

Originally Posted by Pessemist

The question you are asking is better rephrased as,

“What’s the total balance left on the Bond on a particular home?”

At the start bonds can be hefty. $20-$40k

Over time that’s paid off just like your mortgage at whatever interest rate was assigned at the time.

No bond means it has been paid off and a zero balance remains.

It’s important to know the balance (if any) on the bond remaining in a home you are interested in. Otherwise you could be in for an unpleasant surprise at the total monthly mortgage/bond you have to fork out.

Each home is unique in amount of their bond balance. Some owners accelerate bond payments or even pay it off early to make the home more attractive when selling it.

So ask

[Normal]

So it all boils down to:

Be aware of increased maintenance and upgrade desires if you buy an older house. Those can way outweigh those bond prices on a brand new home.

Be aware of bond payments if you buy a newer house. They can exceed 40 K.

The commission driven salesman/realtors that solely uses the pitch, “There’s no bond” for their pitch can be naive of so many other factors that their light heads could carry them away.

[BrianL99]

Originally Posted by Bill14564

Let me type this more slowly this time:

....

"It's a mortgage with a different name, folks. Nothing more, nothing less."


- Except the mortgage is directly related to the value of the home - the bond is not
- Except the mortgage on my home is likely different than the mortgage on my neighbor's - the bond is the same
- Except principal on the mortgage can be paid early - principal on the bond cannot
- Except the mortgage must be satisfied for the home to change hands - the bond does not
- Except I can refinance the mortgage to obtain a better rate - I have no ability to refinance the bond
- Except I can itemize interest paid on the mortgage - I cannot itemize interest paid on the bond

Perhaps you meant to say, "It's a mortgage with a different name... except when it isn't"

There are different ways to think about the bond and some are more correct than others.

I'm not sure it matters how fast or slow you type, if what you're typing is wrong.

The Bond is directly related to the value of your property. Not to the home, but to the lot.

Bonds are not the same for everyone. As for mortgages, you get to choose how much your mortgage is, as does your neighbor. It's not fixed by anyone but the mortgagor.

You absolutely can pre-pay the Bond.

As I've said, it differs from a Mortgage, in that it is "assumable". It does not have to be paid off to sell the property.

You absolutely can refinance your Bond, anytime you wish Call your bank and if you're credit worthy, you're good to go.

As for the deducting the interest? See above. If you opt to refinance your Bond with a 2nd Mortgage on your Primary Residence, that Interest now becomes Tax Deductible (with some limitations).

No, there are no different ways to look at a Bond. It is what it is. The Bond was a loan to the developer to build the infrastructure. When he was done and started building houses, he added up all his costs, split them between all the lots and a mechanism was set up for the buyer's to pay their share. This document explains it: VCDD Pay Off Bond.

The bottom line is the same. If you have a BOND, you do not own your land "free & clear". You have a loan against it that is transferable. It is a debt to the land, not the person. Essentially, the Town/Collector of Taxes/Bond Holder holds an interest in that land, as shown on your Tax Bill. It is different than taxes, as taxes accrue yearly and is not a fixed amount.


(If someone wants to nit pick and talk about the difference between the Note, the Mortgage, a Lien or any general encumbrances, I get it. But to simplify the discussion, I'm lumping them all in together as "mortgage".)

[BrianL99]

....

[Bill14564]

Originally Posted by BrianL99

I'm not sure it matters how fast or slow you type, if what you're typing is wrong.

Very good point.

The Bond is directly related to the value of your property. Not to the home, but to the lot.

Nope. My neighbor's property appraises for more than mine but our bond amounts and bond payments are exactly the same (or were the same before I paid mine)

Bonds are not the same for everyone. As for mortgages, you get to choose how much your mortgage is, as does your neighbor. It's not fixed by anyone but the mortgagor.

Nope. All the bonds in a particular "Unit" are exactly the same. I didn't get to choose how much my bond was and neither did my neighbors.

You absolutely can pre-pay the Bond.

Nope. You can pay the balance in full or you can pay the installment but what you CANNOT do is pay an extra $3,000 on the principal of the bond in order to lower the installment payments. I certainly CAN do that with my mortgage.

As I've said, it differs from a Mortgage, in that it is "assumable". It does not have to be paid off to sell the property.

Yep. An example of how the bond is not just a mortgage.

You absolutely can refinance your Bond, anytime you wish Call your bank and if you're credit worthy, you're good to go.

Nope. You can pay the bond in full but you cannot refinance it. Sure, you can possibly take out a home equity loan or second mortgage to obtain the funds required to pay the balance of the bond. With a "true" refinance, the same collateral used for the original loan is used for the refinanced loan but that would not be the case with a "refinance" of the bond. I guess in a sense it is a form of refinance, but this changes the nature of the loan and the need for additional collateral makes it significantly different from a typical refinance.

As for the deducting the interest? See above. If you opt to refinance your Bond with a 2nd Mortgage on your Primary Residence, that Interest now becomes Tax Deductible (with some limitations).

Well.... *Maybe* you could deduct the interest from a 2nd mortgage (limitations apply) but that is not deducting the interest from the bond, it is deducting the interest from a separate loan which might be in the same amount as the bond balance.

No, there are no different ways to look at a Bond. It is what it is. The Bond was a loan to the developer to build the infrastructure. When he was done and started building houses, he added up all his costs, split them between all the lots and a mechanism was set up for the buyer's to pay their share. This document explains it: VCDD Pay Off Bond.

I kind of agree here except you insist it is the same as a mortgage when it clearly is not.

The bottom line is the same. If you have a BOND, you do not own your land "free & clear". You have a loan against it that is transferable. It is a debt to the land, not the person. Essentially, the Town/Collector of Taxes/Bond Holder holds an interest in that land, as shown on your Tax Bill. It is different than taxes, as taxes accrue yearly and is not a fixed amount.


(If someone wants to nit pick and talk about the difference between the Note, the Mortgage, a Lien or any general encumbrances, I get it. But to simplify the discussion, I'm lumping them all in together as "mortgage".)

And some people look at the tax bill and lump the county property tax, the school tax, the WMD tax, the fire assessment, the maintenance fee, and the bond together and refer to them as simply the "annual property tax." (see the argument over the 33% increase a few years ago) Just because they do that doesn't make it right. Just because you want to use the word "mortgage" doesn't make it the same as a mortgage.

[Ksfirefighter]

Originally Posted by CoupleNCA

We visited the Brownwood TS to introduce ourselves and interest. But the realtor we were assigned on our first in-person visit has refused to answer one of our most basic of questions multiple times (she seems to keep copy/pasting the same answer to my very direct question).

My simple question is this: We've seen several really nice properties that promote the fact that they're "NO BOND". As if it was some huge savings or advantage. I just want to know: "What is the average real-world saving on a property with a bond vs. no-bond?"

The sales brochures shows the monthly fees as "bond+maintenance+fire" so you can't gauge what percentage each makes up.

I totally understand the concept of the bond and I totally understand why each "Villages" bond may differ in terms of price. But we're merely trying to ascertain if a property being highly-promoted as "NO BOND" is really that significant and should be given priority in our choices.

Can anybody please answer this question honestly? My assigned realtor can't or won't.

Sellers think that if they pay off the bond then their house should be worth 30k more than one that is not.
That makes sense….. kind of.
It you buy the home and move 2 years later you only paid 2 payments of the bond and will remarket your house a little less than one that potentially has their bond paid.
My experience is get the home that you want, in the area you want, with the sun exposure you want, so you can enjoy the lanai in the afternoon, pool, no pool but you could put one in, privacy, no kissing lanai’s, golf course but not right up on the cart path. Model 10 is so much more space.
I would never offer 30k more for a house that the bond is paid, but I would for the right home, with all the right things.

[CoachKandSportsguy]

Originally Posted by Bill14564

If the bond is not paid in full in advance then the remaining amount of the bond is directly related to the age of the home. One could say the numbers on a calendar have nothing to do with the age of a home, except that as the numbers get higher the home gets older. Likewise, the balance on the bond has nothing to do with the age of a home, except that as the balance gets lower the home gets older.

spurious correlation, a negative one, on the basis of time, that's all.

[Garywt]

I look at my bond as $129 a month which is built into my escrow account with my mortgage. I don’t see it or feel it. I just pay my mortgage each month and the bank takes care of the rest. So in my case a paid bond would save you $129 a month.

[manaboutown]

Originally Posted by BrianL99

I'm not sure it matters how fast or slow you type, if what you're typing is wrong.

The Bond is directly related to the value of your property. Not to the home, but to the lot.

Bonds are not the same for everyone. As for mortgages, you get to choose how much your mortgage is, as does your neighbor. It's not fixed by anyone but the mortgagor.

You absolutely can pre-pay the Bond.

As I've said, it differs from a Mortgage, in that it is "assumable". It does not have to be paid off to sell the property.

You absolutely can refinance your Bond, anytime you wish Call your bank and if you're credit worthy, you're good to go.

As for the deducting the interest? See above. If you opt to refinance your Bond with a 2nd Mortgage on your Primary Residence, that Interest now becomes Tax Deductible (with some limitations).

No, there are no different ways to look at a Bond. It is what it is. The Bond was a loan to the developer to build the infrastructure. When he was done and started building houses, he added up all his costs, split them between all the lots and a mechanism was set up for the buyer's to pay their share. This document explains it: VCDD Pay Off Bond.

The bottom line is the same. If you have a BOND, you do not own your land "free & clear". You have a loan against it that is transferable. It is a debt to the land, not the person. Essentially, the Town/Collector of Taxes/Bond Holder holds an interest in that land, as shown on your Tax Bill. It is different than taxes, as taxes accrue yearly and is not a fixed amount.


(If someone wants to nit pick and talk about the difference between the Note, the Mortgage, a Lien or any general encumbrances, I get it. But to simplify the discussion, I'm lumping them all in together as "mortgage".)

Disinformation. A bond is debt on the property but it is NOT a mortgage.

[BrianL99]

Originally Posted by manaboutown

Disinformation. A bond is debt on the property but it is NOT a mortgage.

Just stop paying it and see what happens.

Now I'm beginning to understand how The Villages has been able to convince 160,000 retired old people, to move to former swampland in the middle of no where.

It's amazing their marketing folks could convince so many people, that a $50,000 lien against their property, which will ultimately cost over $100,000 to pay off monthly, isn't real money.

[BrianL99]

....

[retiredguy123]

Originally Posted by BrianL99

Just stop paying it and see what happens.

As I understand it, they can foreclose on the property, but they cannot sue you for other assets that you own, like they can with a mortgage. That is because the bond is not a personal debt.