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Paying off Mello Roos

Subdivisions in San Diego built after 1985 often have Mello Roos. Mello Roos is a special tax imposed on property owners through the sales of bonds for the purpose of financing certain public improvements and services such as streets, water sewage, drainage, parks, police, fire, library and schools.

While typically, Mello Roos is spread into payments of 20-30 years, it can be paid off early to save you money in the long term.

For example, new developments in Del Sur and 4S Ranch have 2 Mello Roos bonds each equaling an estimated $50,000. Payments for these bonds (including interest) are $5000 per year for 25 years (numbers are close estimates.)

After 25 years, a homeowners’ total payment will be $125,000. Many homeowners are opting to pay off these bonds early thereby saving as much as $75,000 if the homeowner owns the home for at least 25 years.

Therefor speak with your financial advisor or accountant whether paying off Mello Roos is right for you. If you do not plan on owning the home for more than 10 years, typically, paying off Mello Roos is not worth it. Currently, a paid off Mello Roos does not add to the home’s value therefor you will only save if you own your home for longer than (on average) 10 years.

Lydia Hwang Vosovic
Relocation Specialist
858.472.0608
lydia@411SanDiegoHomes.com

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Refinancing? Have you Considered a Subordination Agreement?

A Subordination Agreement is a legal document used to change the normal priority of any encumbrances that affect your real estate. One of the I’s best uses is when you are considering refinancing your first trust deed. If the holder of the second mortgage does not subordinate to the first mortgage, a new lender might not refinance the first mortgage.

A Subordination Agreement would contain the names of the existing mortgage holder as well as the new lender, describe both the new and present loan, be signed, notarized and recorded in California. There are also some limitations such as time limits, amount and specific purpose for the loan to consider.

If you are thinking about refinancing, your first loan and/or are adding a second loan, it would be advisable to review your Title Report to determine what is already in place. With a call or email, I would be happy to provide a Property Profile or Preliminary Title Report with which to begin your research into the viability of adding Subordination Agreement.

June Kubli, Ph.D.
Broker Associate, Certified Residential Specialist
License #00911089
Coldwell Banker Residential Brokerage
Cell: 858-353-0406
EFax: 858-228-9944
Email: jskubli@gmail.com

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Kathleen Williams
619-944-6520

CalBRE License #00909208

Lydia Hwang Vosovic
858-472-0608

CalBRE License #01445033

June Kubli
858-353-0406

CalBRE License #00911089

Katie Dunahoo
858-775-1239

CalBRE License #00694822

Coldwell Banker
930 Prospect
La Jolla, CA 92037

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