Lincoln Crossing Mello Roos Explained by Lincoln California Real Estate Agent Jesse Coffey.
What is Mello Roos?
The Community Facilities District Act (more commonly known as Mello-Roos) was a law enacted by the California State Legislature in 1982. The name Mello-Roos comes from its co-authors, Senator Henry J. Mello(D-Watsonville) and Assemblyman Mike Roos (D-Los Angeles). The Act enabled "Community Facilities Districts" (CFDs) to be established by local government agencies as a means of obtaining community funding.
A Mello-Roos District is an area where a special property tax on real estate, in addition to the normal property tax, is imposed on those real property owners within a Community Facilities District. These districts seek public financing through the sale of bonds for the purpose of financing public improvements and services.These services may include streets, water, sewage and drainage, electricity, infrastructure, schools, parks and police protection to newly developing areas. The tax paid is used to make the payments of principal and interest on the bonds.
Mello-Roos is not tax deductible.
Mello Roos is most commonly seen in newer developments like Lincoln Crossing. These bonds are used to pay for the infrastructure needed for new communities throughout the State of California. The majority of homes built in the past 20-25 years often have Mello Roos. I have seen Mello Roos range for $30 per month all the way up to $375 per month. It is an expense that should be expected when buying a newer home. Mello Roos bonds typically mature in 15 or 30 year increments.
How does Mello Roos affect my Lincoln Crossing home?
1. As a homeowner it is an annual bill which you must pay. If you do not the City of Lincoln CFD could potential take ownership of your home. Most homeowners have their Mello Roos calculated in their monthly payment.
2. The higher than usual Mello Roos has had a negative affect on Lincoln Crossing home values. The average sold price per square foot is lower in Lincoln Crossing compared to Twelve Bridges or Foskett Ranch. Although impacted negatively Lincoln Crossing is still a very desirable place to live with quality homes.
3. Although Lincoln Crossing home prices have been negatively affected by the high Mello Roos it is still a great value compared to most of Placer County. Based on the quality of home that you own and the quality of life Lincoln Crossing is a wonderful place.
4. If you plan to live in your Lincoln Crossing home for more than 15 years it might be worth paying your Mello Roos off early. It could save you a substantial amount of money.
How does Mello Roos in Lincoln Crossing affect home buyers?
1. Many Lincoln home buyers do not understand Mello Roos and surprisingly many Realtors do not either. The Mello Roos can be a deterrent for many home buyers especially those in the lower price range. Mello Roos will be calculated into your monthly payment and could reduce your purchasing power. A $120 per month Mello Roos payment will reduce your purchasing power by approximately $20,000. For those looking to purchase a home in excess of $200,000 you will likely still be able to buy more home in Lincoln Crossing than in Roseville or Rocklin even with the higher Mello Roos.
2. Many home buyers looking in Lincoln Crossing can qualify to buy with zero down and no mortgage insurance through the USDA loan program. The monthly savings in mortgage insurance will typically offset the Mello Roos making Lincoln Crossing affordable for those that qualify for USDA financing.
3. Lincoln home buyers will be able to enjoy the new community and infrastructure that is currently in place. Eventually the City of Lincoln will finish all the projects in Lincoln Crossing once funding allows.
4. If home buyers plan to stay in Lincoln crossing for more than 15 years they can drastically reduce the amount they will pay for Mello Roos if they choose to prepay.
5. Although Lincoln Crossing home prices have been negatively affected by the high Mello Roos it is still a great value compared to most of Placer County.
How much is Lincoln Crossing Mello Roos annually?
These are the City of Lincoln CFD 2003-1 Lincoln Crossings rates based on square footage of a home located in Lincoln Crossing.
< 1,400 $1,183.90
> 3,000 $3,679.40
Can I pay my Lincoln Crossing Mello Roos of early?
1. Prepayment can be made for any homes, at any time, through the year 2034.
2. This prepayment is only for the City of Lincoln CFD 2003-1 Lincoln Crossings.
3. Prepayments are increments of 25%, 50%, 75% or 100% and will reduce all future
payments based on the percentage prepaid.
4. It does not include any amounts already placed on the tax rolls for the current year. Such
amounts shall be paid prior to the issuance of a lien release for 100% prepayments.
5. Anyone can make a prepayment at any time.
6. Rates are calculated each August for the current Fiscal Year, July through June.
7. Any Prepayments received after May 31 of any year will be credited to and receive a tax
levy the next Fiscal Year.
8. For the School CFD, you will need to contact the School directly for their information.
These are the payoff amounts as of June 1, 2012. The current payoff amounts will be a little lower.
This is for a 100% payoff. You can choose to payoff in increments of 75%, 50% or 25%.
< 1,400 $18,600
> 3,000 $56,900
In addition to Lincoln Crossing real estate I am a very knowledgeable Twelve Bridges real estate agent, Foskett Ranch real estate agent, Sun City Lincoln Hills real estate agent, and Catta Verdera real estate agent. Contact me for all of your Lincoln CA real estate needs.
As a Lincoln CA real estate agent I also assist Lincoln home owners with getting top dollar for their homes. Please contact me for a confidential consultation if you are considering selling your Lincoln home. I am an experienced Lincoln Crossing Real Estate Agent.
Here are links to my Lincoln home sales.