Home Buyers: Impact of Orleans Homebuilders Bankruptcy?
Orleans Homebuilders Inc - a PA based homebuilder, after failing last month to successfully negotiate an extension on a $350 million line of credit, filed for Chapter 11 bankruptcy protection with the U.S. bankruptcy court in Delaware on March 1, 2010. The U.S. Bankruptcy Court has granted Orleans' request to essentially carry on with business as usual, including the closing of sales agreements which were entered into prior to the bankruptcy filing on March 1st.
Orleans has over 90 home communities in eight states, including Pennsylvania and New Jersey.
For information (e.g., case information, news release, etc.) on the bankruptcy:
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Call 888-215-9315 (Orleans Homebuilders Reorganization Hotline)
For concerns or any questions regarding the impact of the bankruptcy:
Contact Your Attorney. Also, it's probably wise to investigate to your satisfaction what arrangements are being made to ensure Orleans' ability to honor its warranty obligations going forward.
This post is provided for informational purposes only.
If you have any real estate questions, please contact me. Whether buying, selling, or just curious to learn more, I'm here to assist you. Please contact me with your questions. I look forward to hearing from you.
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Laws vary from state to state, and new home building contracts can vary considerably from one builder to another. There's no single format for a New Home Agreement of Purchase and Sale. Many builders develop their own contracts, while others use standard contract documents or they adapt model forms available from a variety of sources, including Home Builders Association.
The contract should be read carefully (including the fine print). I suggest that your friend contact his local real estate attorney to review the signed contract (and addendums) and advise him of his options.