Company: LEN
Filing Date: 2025-10-03
Form Type: 10-Q
Source: 0001628280-25-044086
Chunk: 130

Company: LENNAR CORP /NEW/
Filing Date: 2025-10-03
Form: 10-Q
Item: Item 8
Chunk 130
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rose, the Company paid $584.0 million of option deposits to Millrose at the spin-off. Subsequently, on February 10, 2025, Millrose acquired Rausch’s land assets (except for any homesites with homes under construction which were acquired by the Company) and Lennar paid Millrose an additional $90.4 million in option deposits. As of August 31, 2025, total deposits and pre-acquisition costs on real estate relating to option contracts with Millrose were $969.3 million.

(11)Commitments and Contingent Liabilities

The Company is party to various claims, legal actions and complaints relating to homes sold by the Company arising in the ordinary course of business. In the opinion of management, the disposition of these matters will not have a material adverse effect on the Company’s condensed consolidated financial statements. From time to time, the Company is also a party to various lawsuits involving purchases and sales of real property. These lawsuits often include claims regarding representations and warranties made in connection with the transfer of properties and disputes regarding the obligation to purchase or sell properties.The Company does not believe that the ultimate resolution of these claims or lawsuits will have a material adverse effect on its business or financial position. However, the financial effect of litigation concerning purchases and sales of property may depend upon the value of the subject property, which may have changed from the time the agreement for purchase or sale was entered into.Product WarrantyWarranty and similar reserves for homes are established at an amount estimated to be adequate to cover potential costs for materials and labor with regard to warranty-type claims expected to be incurred subsequent to the delivery of a home. Reserves are determined based on historical data and trends with respect to similar product types and geographical areas. The activity in the Company’s warranty reserve, which is included in Homebuilding other liabilities, was as follows:

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Lennar Corporation and SubsidiariesNotes to Condensed Consolidated Financial Statements (Unaudited) (Continued)

Three Months EndedNine Months EndedAugust 31,August 31,(In thousands)2025202420252024Warranty reserve, beginning of the period$442,058 403,448 446,240 414,796 Warranties issued62,241 76,653 185,873 211,001 Adjustments to pre-existing warranties from changes in estimates(11,260)18,768 3,126 15,483 Payments(70,154)(76