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Anybody Buying a Beazer Home?

Posted by triciae (My Page) on
Sat, Sep 8, 07 at 8:08

This may be of interest if you're either under contract or considering purchasing a Beazer Home in the near future...

"Beazer Homes Receives Notice of Default
13 hours ago

ATLANTA (AP) Homebuilder Beazer Homes USA Inc. says it has received default notices for five senior notes due between 2011 and 2016, though the company denies it is in default on that debt.

Shares fell $1.41, or 13 percent, to $9.50 Friday, a little more than two weeks after Beazer had asked a federal court to stop U.S. Bank National Association from demanding the builder repay $1.38 billion in loans.

Minnesota-based U.S. Bank is the trustee for the loans, meaning it must ensure that the borrower is in compliance with the lending terms. The bank also enforces any default declaration by the lenders.

The notices from U.S. Bank concerning the debt said Beazer had gone into default because it hasn't filed its 10-Q report with the Securities and Exchange Commission for the quarter that ended June 30 and thus failed to deliver those files to the trustee.

It gives the company 60 days to do so.

But Beazer said in a statement that it believes the notices are invalid because the company is only required to give the trustee copies of its report 15 days after delivering it to the SEC.

Beazer spokesman Leslie Kratcoski declined to comment further Friday afternoon.

"We are not speculating on any possible outcomes," she said, adding the litigation is ongoing.

U.S. Bank spokesman Steve Dale declined to comment Friday.

In the complaint filed in August in U.S. District Court in Atlanta, Beazer said many of its noteholders have bought company bonds at depressed prices in the market and are trying to make "a windfall by demanding accelerated repayment in full."

Beazer delayed filing its fiscal third-quarter results after the company discovered accounting irregularities that may force it to restate financial results. Most corporate loans depend upon the company being up-to-date with its regulatory filings, mainly quarterly and annual financial statements."

This is a "Covenant Default" & U.S. Bank has called the senior notes. If I were under contract on a Beazer home & they had a nice fat deposit check from me...I'd be concerned.

/t


Follow-Up Postings:

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RE: Anybody Buying a Beazer Home?

It looks like nobody is under contract with Beazer which is a good.

/t


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RE: Anybody Buying a Beazer Home?

I'd never heard of them but then today out driving around I saw a sign into a new subdivision with Beazer on it and I thought of this post.


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RE: Anybody Buying a Beazer Home?

Beazer is not long for this world. I wrote over a month ago (I believe in response to someone's post that homebuilders would never go bankrupt) that BZH was little better than a dot com at the time and that their financials were horrific.


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RE: Anybody Buying a Beazer Home?

There was a post in March about them being investigated, then another in July that they were being sued. Thankfully they didn't have any communities by us and if they did and we walked them, it didn't leave an impression like a few other builders did.

Very glad we didn't have the chance to buy from them!


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RE: Anybody Buying a Beazer Home?

Before You Buy a Beazer Home, Consider the Number of Complaints filed against Beazer Homes, Beazer does not provide quality work and many of the homes that are built are of very poor quality.

For the most part just say no to beazer homes and seek out another reputable home builder, other than beazer.

Do Your own reaserch about beazer and I am sure you will find many complaints against beazer homes.

Beazer also hires people from the 7-11 parking lots to build houses and charges premium prices and gets cheap labor and passes the inexperience off to you.

The Beazer promise holds no water, it is just part of a sales pitch to get non-informed consumers to purchase their homes.

If you know anyone looking for a new home, tell them to avoid beazer, Beaser Homes, at all costs.

Here is a link that might be useful: Beazer Homes


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RE: Anybody Buying a Beazer Home?

So Tricia, what happens if someone does buy a beazer home or a home from another builder that goes out of business? What happens to the homeowner and the subdivision? We're looking at a subdivision where the builder, while known for their good quality, looks like it's having some trouble paying debt and is selling off parts of the (mostly finished) subdivision. What could that mean for a buyer and what does it mean for the residents?


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RE: Anybody Buying a Beazer Home?

Many stories have appeared recenty of subdivisions with only a few homes built..and those few owners deal with unfinshed roads...empty lots..no neighbors...no amenities that may have been offered..such as to lots, etc.

One also risks that a new builder who buys the property may build homes that are not in character with those already constructed.

It also would make it much harder if not impossible to have any defects repaired by the builder, if the builder has gone out of business..leaving one without recourse in the event of repairs...which could be a nightmare in the event of major construction errors in terms of water intrusion, etc.

In essence, it is buying a pig in a poke in terms if an when the development will be finished...and how....which can all greatly impact the value of the few homes already finshed and occupied.

Here is a link that might be useful: Abandoned House in a Lost Subdivision


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RE: Anybody Buying a Beazer Home?

In one of the subdivisions I'm interested in, some of the lots are being sold off. I'd say the neighborhood is about 75% complete and is about 4 years old, all amenities in place.

How much control would an existing HOA have in controlling what kind of homes are built on the sold-off lots? How do you find out about about stuff like that? Where would one even look?


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RE: Anybody Buying a Beazer Home?

"How much control would an existing HOA have in controlling what kind of homes are built on the sold-off lots?"

The HOA in many case usually does not get authorized until the entire devlopment is completed. The best thing to do is read the by-laws...as I believe the HOA may only be able to dictate to homeowners...and not a builder.

Each case is different..and even then, a potential developer could sue for the right to build what he pleases...and that could go on for years...draining the HOA coffers, and that means draining the residents pockets as they fund the HOA.

In additon, most townships would be amenable to changes of the original plan, in order to get the development completed, and get homes on the tax rolls.

Best bet would be to consult a knowledgeable real estate attorney..however, IMO, he/she would not be able to provide the equivocal answers that you seek, as there are way too many unknowns and variables at play...and it would probably cost a pretty penny to have an attorney research all of it...

Even so, in the end, IMO he or she would simply advise you to just buy in a comlpeted development..and avoid all of the unknowns, expense and aggravation of an uncompleted development.


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RE: Anybody Buying a Beazer Home?

There's a small subdivision here experiencing this type of situation. DH & I looked at a home in the subdivision late last winter or early spring...very nice house. But, of the 9 lots only 3 had houses. We were told that if the builder failed anybody coming in new would have to abide by the existing approvals. Hahahaha, they must have thought we were just born yesterday!

The builder lost the sites to foreclosure mid-summer. The lender sold them off in bulk. Now, there are two new homes up in that subidivision...each about half the size of the one we looked at and of much inferior quality. They are selling for $400K less than those first 3 houses. The original houses' value will be pulled down.

logic is right. Buying into an incomplete PUD is always a risk. Just like the above situation here...the town can and often does change subdivision approvals to match current marketing conditions. Having empty lots & unfinished roads/utilitites/amenities does nobody any good.

/tricia


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RE: Anybody Buying a Beazer Home?

Wow, logic and tricia, y'all are worth your weight in gold! Thanks!

We list this house monday, it'll be interesting to see what happens from here. I feel like the more I know, the better decisions we can make :)


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RE: Anybody Buying a Beazer Home?

We closed on our new townhouse 3 weeks ago. When we contracted in May, about 45 of 82 total to be build were sold. Today there are 2 homes left to be sold.
Buyers need to know the local real estate market when making a decision to purchase, anything else can cost them lots of money and agravation.


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RE: Anybody Buying a Beazer Home?

Never Buy a Beazer Home, They are the Kings of Bait and Switch, maybe you did not read my last post where, it said they use workers from 7-11 parking lots to build homes. Don't get me wrong but, doesn't that mean they really don't care about the quality of the houses, their primary focus is making money and conning innocent, hard working people out of their money, avoid Beazer at all costs, also there will be a live video on you tube shortly detailing what they did to a brand new neighborhood, in woodbridge, virginia, Beazer of Virginia is based in Chantilly, Va and should be avoided by any means necassary. Numerous complaints have been filed against this home builder, shoddy construction, mold in homes, Beazer just does not do enough after you are in their poorly built homes. They take your money and run. I hope the new president wether it is Obama or McCain, does something. It's time Americans demanded more from the companies that build our homes. It's 2008 almost 2009 and there is no reason homes should be built this poorly. It's Buyer beware when buying from beazer. USA, Virgina, Maryland, Washington DC, New York, Atlanta Real Estate Buyers Beware. Beazer

Here is a link that might be useful: Beazer


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