Company: LEN
Filing Date: 2025-01-23
Form Type: 10-K
Source: 0001628280-25-002404
Chunk: 40

Company: LENNAR CORP /NEW/
Filing Date: 2025-01-23
Form: 10-K
Item: Item 8
Chunk 40
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 lending activities.Substantially all of the residential loans the Financial Services segment originates are sold within a short period in the secondary mortgage market on a servicing-released, non-recourse basis. After the loans are sold, the Company retains potential liability for possible claims by purchasers that it breached certain limited industry-standard representations and warranties in the loan sale agreements. Purchasers sometimes try to defray losses by purporting to have found inaccuracies related to sellers’ representations and warranties in particular loan sale agreements. Mortgage investors could seek to have the Company buy backmortgage loans or compensate them for losses incurred on mortgage loans that the Company has sold based on claims that the Company breached its limited representations or warranties. The Company’s mortgage operations have established accruals for possible losses associated with mortgage loans previously originated and sold to investors. The Company establishes accruals for such possible losses based upon, among other things, an analysis of repurchase requests received, an estimate of potential repurchase claims not yet received and actual past repurchases and losses through the disposition of affected loans as well asprevious settlements. While the Company believes that it has adequately reserved for known losses and projected repurchase requests, given the volatility in the residential mortgage industry and the uncertainty regarding the ultimate resolution of these claims, if either actual repurchases or the losses incurred resolving those repurchases exceed the Company’s expectations, additional recourse expense may be incurred. The provision for loan losses was immaterial for both the years ended November 30, 2024 and 2023. Loan origination liabilities were $16.7 million and $17.6 million, as of November 30, 2024 and 2023, respectively, and included in Financial Services’ liabilities in the Company's consolidated balance sheets.

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Table of ContentsLENNAR CORPORATION AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

LMF Commercial - loans held-for-saleLMF Commercial originated commercial loans as follows:Years Ended November 30,(Dollars in thousands)20242023Originations (1)$568,520 466,043 Sold$522,647 430,707 Securitizations13 10 (1)During both years ended November 30, 2024 and 2023, the commercial loans originated were recorded as loans held-for-sale, which are held at fair value.Investments held-to-maturity At November 30, 2024 and 2023, the Financial Services segment held commercial mortgage-backed