Mello-Roos Taxes – Definition
What is or are Mello-Roos? Sometimes misspelled “melarose”, these are special assessment taxes for Community Facilities Districts or CFDs. Typically new communities need additional infrastructures such as police and fire protection services, ambulance and paramedic services, parks, elementary and secondary schools, libraries, museums, and cultural facilities.
These taxes are liens which are usually municipal bonds issued to fund this needed infrastructure before a housing development is built. These are in addition to your regular property taxes. When buying your new home, any unpaid special assessments are paid by the seller.
The buyer (that’s you) will take title of the home subject to the condition that these special assessments will continue to occur in the future. That means you will be paying Mello-Roos taxes for as long as you own the home, or until they expire. The bonds issued for Mello-Roos may expire in 10 to 40 years, depending on the CFD.
There are four Community Facilities Districts in Brentwood for instance, along with various other communities in California.
To find out if the home you are looking to buy is in a Mello-Roos district, you have to know the parcel number of the property.
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Also, the seller must disclose that the property has Mello-Roos taxes before you actually purchase, so you will know in advance either way.
Mello-Roos Tax – Conclusion
Let’s sum this up. Some homes in CFDs have special tax assessments called Mello-Roos. These communities benefit from having additional infrastructures such as new schools, libraries, and other community enhancements. Homebuyers in these districts will have to pay these taxes along with regular property taxes for as long as they own the home, or until the additional tax expires.
You, along with your Real Estate Agent can determine if buying a home with Mellow-Roos is right for you.