Thursday, December 4, 2008

Kimball Hill Bankruptcy - What Happens to Kimball Hill Homeowners?

What happens when a builder goes bankrupt?

Several north Texas communities are learning the answer the hard way.
Many are unfinished and are now out of luck. Kimball Hill Homes announced Tuesday that it is shutting down all operations across the country in the next 15 months.
This affects five different developments in Tarrant, Dallas and Collin Counties.
Homeowners here are now very worried that this is going to be a huge financial loss for them too.

Jason Roberts bought his south Arlington home two years ago. It was a long-term investment for his family. But he didn't think he would outlast his homebuilder Kimball Hills.
"It is a bit disappointing to see that at such an early stage in our community development they're pulling out. And they're leaving us sort of high and dry," he said.

A statement released by Kimball Hill's Chief Executive Officer Ken Love says: "We deeply regret the necessity of today's decision, but given the current housing and financial market conditions, we are simply unable to conduct normal operations while the company continues its sale efforts."
The company says homes already under construction will be finished, but they are not building any new homes. They are looking to sell the unfinished lots.

"At this point, we don't know where it's gonna go. So you don't know if right across the street in the new phase if they decide to sell if off to somebody else, are they going to put condominiums in or apartments? At this point we don't know where it's going to go," said Roberts.
This also means homeowners association dues may dramatically increase.

"The community as a whole may suffer. Because we don't have the cash flow coming in to help us with the greenbelts, and the attractiveness and appeal of the area," said Roberts.
Just how much more, remains to be seen.

Warranties on home bought after April 23rd will be honored.

But for home purchased before this date will not have a Kimball Hill warranty.
There are five Kimball Hill properties in Tarrant, Collin and North Texas affected.

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