8-KMaterial AgreementsFinancial EventsExhibits & Filings

HORTON D R INC /DE/ 8-K Report, Material Agreement (Apr 3, 2008)

Filed April 3, 2008For Securities:DHI

Summary

D.R. Horton, Inc. (DHI) subsidiary, DHI Mortgage Company, Ltd., has entered into a new Master Repurchase Agreement (Repurchase Facility) with U.S. Bank National Association and JPMorgan Chase Bank, National Association, among other buyers. This facility, effective March 28, 2008, provides DHI Mortgage with up to $275 million in financing, with an option to increase to $500 million through an accordion feature. The purpose of this agreement is to offer crucial liquidity by facilitating the purchase of eligible loans by DHI Mortgage against transferred funds from buyers. Concurrently, DHI Mortgage has voluntarily terminated its commercial paper conduit facility (CP Facility) with CH Funding, LLC, effective April 1, 2008. This termination is a strategic move, as DHI Mortgage believes the new Repurchase Facility will sufficiently meet its liquidity needs for mortgage operations. The termination of the CP Facility, which had a $600 million capacity and no outstanding balance at the time, signals a shift in DHI Mortgage's financing strategy in response to market conditions or its operational requirements.

Key Highlights

  • 1DHI Mortgage secures a new $275 million Repurchase Facility, expandable to $500 million, to enhance liquidity.
  • 2The Repurchase Facility is designed to finance DHI Mortgage's purchase of eligible loans.
  • 3D.R. Horton, Inc. and its other subsidiaries do not guarantee the amounts outstanding under this new facility.
  • 4The new facility replaces a maturing warehouse loan facility that expired on March 28, 2008.
  • 5DHI Mortgage voluntarily terminated its $600 million commercial paper conduit facility (CP Facility).
  • 6The termination of the CP Facility is based on the confidence that the new Repurchase Facility will provide sufficient liquidity.
  • 7No amounts were outstanding under the terminated CP Facility at the time of its closure.

Frequently Asked Questions

The primary purpose of the Repurchase Facility is to provide financing and liquidity to DHI Mortgage by facilitating purchase transactions where DHI Mortgage transfers eligible loans to buyers in exchange for funds.

The Repurchase Facility has a maximum aggregate commitment amount of $275 million, with an accordion feature that allows for an increase up to $500 million.

No, amounts outstanding under the Repurchase Facility are not guaranteed by D.R. Horton, Inc. or any of its subsidiaries that guarantee their homebuilding debt.

The CP Facility was voluntarily terminated because DHI Mortgage believes that the new Repurchase Facility will provide sufficient liquidity for its mortgage operations. The CP Facility had no amounts outstanding at the time of termination.