Company: LGIH
Filing Date: 2025-04-30
Form Type: 10-Q
Source: 0001580670-25-000043
Chunk: 71

Company: LGI Homes, Inc.
Filing Date: 2025-04-30
Form: 10-Q
Item: Part I, Item 8
Chunk 71
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. As of March 31, 2025, the 2024 Credit Agreement’s carrying value approximates market value since it has a floating interest rate, which increases or decreases with market interest rates and our leverage ratio.In order to determine the fair value of each of the 2028 Senior Notes, the 2029 Senior Notes and the 2032 Senior Notes, the future contractual cash flows are discounted at our estimate of current market rates of interest, which were determined based upon the average interest rates of similar senior notes within the homebuilding industry (Level 2 measurement).The following table below shows the level and measurement of liabilities at March 31, 2025 and December 31, 2024 (in thousands):March 31, 2025December 31, 2024Fair Value HierarchyCarrying ValueEstimated Fair ValueCarrying ValueEstimated Fair Value2028 Senior Notes (1)Level 2$400,000 $435,252 $400,000 $436,783 2029 Senior Notes (1)Level 2$300,000 $276,314 $300,000 $274,692 2032 Senior Notes (1)Level 2$400,000 $421,643 $400,000 $421,247 

(1)See Note 4 for more details regarding the offerings of the 2028 Senior Notes, the 2029 Senior Notes and the 2032 Senior Notes. 

10.     COMMITMENTS AND CONTINGENCIES

ContingenciesIn the ordinary course of doing business, we are subject to claims or proceedings from time to time relating to the purchase, development and sale of real estate and homes and other aspects of our homebuilding operations. Management believes that these claims include usual obligations incurred by real estate developers and residential home builders in the normal course of business. In the opinion of management, these matters will not have a material effect on our consolidated financial position, results of operations or cash flows.We have provided unsecured environmental indemnities to certain lenders and other counterparties. In each case, we have performed due diligence on the potential environmental risks including obtaining an independent environmental review from outside environmental consultants. These indemnities obligate us to reimburse the guaranteed parties for damages related to environmental matters. There is no term or damage limitation on these indemnities; however, if an environmental matter arises, we may have recourse against other previous owners. In the ordinary course of doing business, we are subject to regulatory