What is the "Buckeye CFD"?
If you are thinking about buying a home in Buckeye, one of the common issues that your loan officer will need to deal with it the Buckeye CFD. This is a VERY important conversation to have with your lender up front, to make sure that they can underwrite the loan on your new home with a CFD because there are lenders that can’t fund the loan if there is a CFD. Here is Why:
CFD stands for Community Facilities District financing. It was put in place when the builders of certain subdivisions like Sundance as a way to finance the acquisition, construction, operation and maintenance of various types of public infrastructure including:
- Roadways and Parking
- Water Systems
- Sewer Systems
- Parks and Open Spaces
- Pedestrian Walk Ways
- Hiking, Biking and Walking Trails
- Drainage Systems
- Public Lighting
- Public Buildings
- Fire Protection
- Public Safety Facilities
- Traffic Safety
- Equipment, Furnishing and Vehicles
The Buckeye CFD is considered a District Assessment Lien Bond which gets paid bi-annually. It is considered a Lien and not a Tax which would be considered a General Obligation Bond. This means that the Underwriter must understand that the loan for the home will be “subordinate” to the CFD just as it would be a General Obligation Bond or Tax. Failure to pay a CFD will result in Foreclosure, so some lenders won’t underwrite the loan. This is why having the right Real Estate Team working with you can mean having a smooth transaction or having a broken heart when you can’t close the loan and loose your dream home!
How Much Does A CFD Cost?
CFD’s vary in cost depending on the size of a lot, the amount of public improvements or the financing terms of the bond but are “usually” a couple hundred dollars per year, paid Bi-Annually.
Does Every Home In Buckeye Have A CFD?
No, it will depend on what subdivision you find a home in as well as if the CFD has been paid off. That’s right, a CFD can be paid in full. So ask your Realtor if they know the status of the CFD on the home you wish to buy so that they can potentially negotiate a payoff for you!