If you’re planning on buying a home in Southern California, you’re going to find out that you will also have to pay Mello-Roos.
In this article, we will break down what exactly Mello-Roos is and provide you with information on if it will actually expire or not.
What Is Mello-Roos?
The term “Mello-Roos” actually refers to areas in Southern California where a special tax has been imposed on homeowners who fall within a “Community Facilities District”. These districts are “developing areas” and can seek financing via the sale of bonds for building parks, police stations, drainage, infrastructure, water, streets and electricity infrastructure.
How Is Mello-Roos Paid?
Mello-Roos will be paid with your annual tax bill so it’s actually due two times per year and is based on the value of the property so this tax can range anywhere from a total of $500 to $10,000 per year depending on the home and the district where it’s located.
A homeowners Mello-Roos payment is used towards paying the principal and interest payment on the bond.
When you view your property tax bill you will see that Mello-Roos is listed as a “Notice of Special Tax Lien” on your property and it does have to be paid on time or the Communities Facilities District that obtained the lien may pursue a judicial foreclosure against you.
Can Mello-Roos Expire?
Most homeowners in California who pay this bond always want to know one thing, does it expire? The answer to this question is yes. Most Mello-Roos bonds average between 25-30 years but it’s not uncommon for this bond to last up to 40 years unless it’s canceled in accordance with the law.
Contact the Fred Sed Group
To learn more about buying a home in Southern California that may have Mello-Roos, contact the Fred Sed Group today by calling us at (800) 921-9231 or connect with us online.