Buying New Construction In Central Florida: CDD Fees, Incentives And Your Mortgage
New communities in Orange, Osceola, Seminole, Lake and Polk counties often come with builder incentives, CDD assessments and long build timelines. Each one affects your mortgage. Here is what to compare before you sign.
Look Past The Purchase Price
A new home can look affordable at the list price and still cost more each month than a resale home. Your payment includes principal and interest, property taxes, homeowners insurance, association dues and, in many new communities, CDD assessments. Lenders count these costs when they figure how much you can borrow.
Insurability matters too. Newer construction often qualifies for better windstorm terms, but quotes still vary by address, so get an insurance estimate for the specific home before you commit.
What To Ask Before You Sign
CDD Assessments
CDDs are special districts that fund community infrastructure. Assessments usually appear on the property tax bill and can run for many years, until the bonds are repaid. Ask for the annual amount and the payoff schedule.
HOA And Dues
Association fees can rise over time. Ask what they cover, how often they have increased and whether a builder-controlled board has set them.
Builder Incentives
Incentives may include closing cost credits, upgrades or a rate buydown. Value each one in dollars and compare it with a price reduction.
Build Time, Rate Locks And Appraisals
A home that is not finished yet has a different mortgage timeline. Plan for these points.
- Choose a lock that covers the expected completion date, and ask about extension costs
- Expect the appraisal to compare the contract price with similar homes, so incentives built into the price can matter
- Seller concessions have limits that depend on the loan type and down payment
- Do the final walk-through before closing and keep a written punch list
- Confirm the certificate of occupancy and the closing date with the builder in writing
Compare At Least Two Quotes
Get a loan estimate from the builder’s preferred lender and from an independent lender. Compare the rate, points, fees, credits and the monthly payment, not just the incentive’s headline number.
New Construction Mortgage FAQs
What is a CDD and how does it affect my mortgage?
A Community Development District is a special-purpose local government that finances roads, drainage and other infrastructure, often with bonds repaid by assessments on the homes it serves. Those assessments are usually billed with your property taxes and count as a housing cost when a lender figures your monthly obligations, so ask for the exact amount before you buy.
Are builder incentives worth it?
Sometimes. Compare the total cost, not the headline: the purchase price, the interest rate, any temporary buydown, closing cost credits and what you give up if the incentive requires the builder’s lender. Get an outside quote so you have something to compare it with.
What is a temporary rate buydown?
It lowers your payment for the first year or two, for example with a 2-1 or 3-2-1 structure, and then the payment steps up to the full amount. It does not lower the note rate for the life of the loan, so check that you can afford the full payment.
How long should my rate lock be on a home that is not built yet?
Long enough to cover the expected completion date, plus a cushion. Construction delays are common, and extending a lock can cost money. Ask your lender about lock length, extension fees and any float-down option before you sign the contract.
Can I use any lender with a builder?
You can usually get a quote from any lender, but builders often tie their best incentives to their preferred or affiliated lender. Read the contract terms, compare the full cost of each offer and choose the lender that gives you the better overall deal.
Ask William To Walk Through Your Numbers
William “Will” Willis, Branch Manager (NMLS #1514031), has more than 27 years of Florida mortgage experience. Call (904) 615-7720, email william@neomtg.com or use the form on our homepage.
Related guide: Orange County down payment assistance guide.
Related guide: Central Florida first-time buyer guide.
Related guide: Central Florida pre-approval checklist.
This page is general information, not legal or tax advice, a loan offer or a commitment to lend. Builder incentives, CDD terms and lender guidelines vary, so review your contract with an attorney and confirm details with a lender. Loans are subject to credit approval and property eligibility. Mortgage services are provided by William Willis, NMLS #1514031. Verify licensing at the NMLS Consumer Access portal.