8-KMaterial AgreementsFinancial EventsExhibits & Filings

HORTON D R INC /DE/ 8-K Report, Material Agreement (Feb 28, 2018)

Filed February 28, 2018For Securities:DHI

Summary

D.R. Horton, Inc. (DHI), through its subsidiary DHI Mortgage Company, Ltd., has entered into a Fifth Amendment to its Master Repurchase Agreement with U.S. Bank National Association and other buyers. This amendment, effective February 23, 2018, primarily extends the maturity date of the financing facility by 364 days to February 22, 2019. This extension is crucial for maintaining liquidity and operational flexibility for DHI Mortgage, which utilizes this facility to finance the purchase of eligible loans. The Fifth Amendment also brings favorable terms for DHI Mortgage, including higher advance rates on collateral and lower pricing on the facility. These enhancements are expected to improve the cost-effectiveness of its financing and potentially increase the amount of capital available for its lending activities. The refinancing of this significant credit facility demonstrates DHI's proactive management of its financial resources to support its ongoing business operations and strategic objectives.

Key Highlights

  • 1DHI Mortgage Company, Ltd. entered into a Fifth Amendment to its Master Repurchase Agreement with U.S. Bank and other buyers.
  • 2The amendment extends the maturity date of the repurchase facility by 364 days, to February 22, 2019.
  • 3The facility provides DHI Mortgage with financing and liquidity for the purchase of eligible loans.
  • 4Key improvements in the amendment include higher advance rates on collateral.
  • 5The amendment also secures lower pricing on the repurchase facility.
  • 6The Fifth Amendment was effective as of February 23, 2018.
  • 7This action is reported under Item 1.01 (Entry into a Material Definitive Agreement) and Item 2.03 (Creation of a Direct Financial Obligation) of the 8-K filing.

Frequently Asked Questions

The Master Repurchase Agreement facilitates financing and liquidity for DHI Mortgage Company, Ltd. by allowing it to transfer eligible loans to buyers in exchange for funds, which are then treated as purchased loans under the agreement's terms.

The most significant changes are the extension of the facility's maturity date by 364 days to February 22, 2019, along with beneficial updates such as higher advance rates on collateral and lower pricing for the facility.

The amendment provides D.R. Horton's mortgage subsidiary with continued access to essential financing, potentially at a lower cost and with greater leverage due to higher advance rates. This supports ongoing operations and liquidity management for its mortgage lending activities.

This is an amendment (the Fifth Amendment) to an existing Second Amended and Restated Master Repurchase Agreement that has been in place since February 27, 2015, and has undergone several previous amendments.