10.

Debt and other financing arrangements

The Company's senior notes are summarized as follows ($000's omitted):


	September 30, 2011		December 31, 2010
8.125% unsecured senior notes due February 2011 (a)	$	—	$	13,900
5.45% unsecured senior notes due August 2012 (b)		96,955		104,823
6.25% unsecured senior notes due February 2013 (b)		62,662		62,617
5.125% unsecured senior notes due October 2013 (b)		116,871		160,212
5.25% unsecured senior notes due January 2014 (b)		335,865		335,848
5.70% unsecured senior notes due May 2014 (b)		311,187		309,048
5.20% unsecured senior notes due February 2015 (b)		244,873		244,839
5.25% unsecured senior notes due June 2015 (b)		402,202		397,700
6.50% unsecured senior notes due May 2016 (b)		468,521		466,644
7.625% unsecured senior notes due October 2017 (a)		149,346		149,265
7.875% unsecured senior notes due June 2032 (b)		299,098		299,065
6.375% unsecured senior notes due May 2033 (b)		398,400		398,344
6.00% unsecured senior notes due February 2035 (b)		299,383		299,363
7.375% unsecured senior notes due June 2046 (b)		150,000		150,000

Total senior notes—carrying value (c)	$	3,335,363	$	3,391,668

Estimated fair value	$	2,963,087	$	3,227,404

(a)

Not redeemable prior to maturity, guaranteed on a senior basis by certain wholly-owned subsidiaries

(b)

Redeemable prior to maturity, guaranteed on a senior basis by certain wholly-owned subsidiaries

(c)

The recorded carrying value reflects the impact of various discounts and premiums that are amortized to interest cost over the respective terms of the senior notes

During the nine months ended September 30, 2011, the Company retired prior to their stated maturity dates $53.0 million of senior notes. Losses on these transactions totaled $3.5 million, including the write-off of unamortized discounts, premiums, and transaction fees, and are reflected in other expense (income), net.

Letter of credit facilities

As a cost-saving measure and to provide increased operational flexibility, the Company voluntarily terminated its $250.0 million unsecured revolving credit facility effective March 30, 2011. The credit facility was scheduled to expire in June 2012, had no borrowings outstanding, and was being used solely to issue letters of credit ($221.6 million outstanding at December 31, 2010). The Company did not pay any penalties as a result of the termination. The termination of the facility also:

•

released the $250.0 million of cash required by the credit facility to be maintained in liquidity reserve accounts;

•

released the Company from the credit facility's covenant requirements, which included, among other things, a maximum debt to tangible capital ratio and a tangible net worth minimum; and

•

resulted in expense of $1.3 million related to the write-off of unamortized issuance costs, which is included within selling, general, and administrative expenses for the nine months ended September 30, 2011.

In connection with the termination of the credit facility, the Company entered into separate cash-collateralized letter of credit agreements with a number of financial institutions. These agreements provide capacity to issue letters of credit totaling up to $192.0 million, of which $89.4 million were outstanding at September 30, 2011. Under these agreements, the Company is required to maintain deposits with these financial institutions in amounts approximating the letters of credit outstanding. Such deposits are included in restricted cash.

The Company also maintains an unsecured letter of credit facility with a bank that expires in June 2014 and permits the issuance of up to $200.0 million of letters of credit by the Company. At September 30, 2011 and December 31, 2010, $155.3 million and $167.2 million, respectively, of letters of credit were outstanding under this facility.

Financial Services

Pulte Mortgage provides mortgage financing for many of the Company's home sales utilizing its own funds and borrowings made available pursuant to certain repurchase agreements. Pulte Mortgage uses these resources to finance its lending activities until the mortgage loans are sold to third party investors, generally within 30 days. Given the Company's current liquidity position and the cost of third party financing relative to existing mortgage rates, Pulte Mortgage allowed each of its third party borrowing arrangements to expire during 2010 and began funding its operations using internal Company resources.