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Loans Payable, Senior Notes, and Mortgage Company Loan Facilities | 3 Months Ended
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Jan. 31, 2025
Debt Disclosure [Abstract] |
Loans Payable, Senior Notes, and Mortgage Company Loan Facilities | Loans Payable, Senior Notes, and Mortgage Company Loan Facilities Loans Payable At January 31, 2025 and October 31, 2024, loans payable consisted of the following (amounts in thousands):
| January 31, 2025 |  | October 31, 2024
Senior unsecured term loan | $ | 650,000 |  |  | $ | 650,000 |
Loans payable – other | 410,655 |  |  | 437,969 |
Deferred issuance costs | (1,890) |  |  | (2,152) |
| $ | 1,058,765 |  |  | $ | 1,085,817 |
Senior Unsecured Term Loan At January 31, 2025, we were party to a $650.0 million senior unsecured term loan facility (the “Term Loan Facility”) with a syndicate of banks of which $487.5 million was scheduled to mature on February 14, 2028, $101.6 million was scheduled to mature on November 1, 2025 and the remaining $60.9 million was scheduled to mature on November 1, 2026. As of such date, there were no payments required before these stated maturity dates. Under the Term Loan Facility, we may select interest rates equal to (i) SOFR plus an applicable margin, (ii) the base rate (as defined in the agreement) plus an applicable margin, or (iii) the federal funds/Euro rate (as defined in the agreement) plus an applicable margin, in each case, based on our leverage ratio. At January 31, 2025, the interest rate on the Term Loan Facility was 5.24% per annum. Toll Brothers, Inc. and substantially all of its 100%-owned home building subsidiaries are guarantors under the Term Loan Facility. The Term Loan Facility contains substantially the same financial covenants as the Revolving Credit Facility described below. On February 7, 2025, we entered into an amendment to the Term Loan Facility to extend the maturity date of all $650.0 million of outstanding term loans to February 7, 2030. All other provisions of the Term Loan Facility remained unchanged. In November 2020, we entered into five interest rate swap transactions to hedge $400.0 million of the Term Loan Facility through October 2025. The interest rate swaps effectively fix the interest cost on the $400.0 million at 0.369% plus the spread set forth in the pricing schedule in the Term Loan Facility, which was 0.90% as of January 31, 2025. These interest rate swaps were designated as cash flow hedges. Revolving Credit Facility At January 31, 2025, we had a $1.96 billion senior unsecured revolving credit facility (the “Revolving Credit Facility”) with a syndicate of banks that was scheduled to mature on February 14, 2028. The Revolving Credit Facility provided us with a committed borrowing capacity of $1.96 billion, which we had the ability to increase up to $3.00 billion with the consent of lenders. Under the Revolving Credit Facility, up to 100% of the commitment is available for letters of credit. Toll Brothers, Inc. and substantially all of its 100%-owned home building subsidiaries are guarantors of the borrower’s obligations under the Revolving Credit Facility. Both our Revolving Credit Facility and Term Loan Facility require us to maintain certain financial covenants, which include not exceeding a defined maximum leverage ratio and maintaining a minimum tangible net worth. In addition, our ability to repurchase our common stock and pay cash dividends is limited by these agreements. However, during the three months ended January 31, 2025, these limitations did not meaningfully restrict our ability to pay cash dividends or repurchase stock. We were in compliance with all covenants and requirements as of January 31, 2025. At January 31, 2025, we had no outstanding borrowings under the Revolving Credit Facility and had approximately $182.7 million of outstanding letters of credit that were issued under the Revolving Credit Facility. At January 31, 2025, the interest rate on outstanding borrowings under the Revolving Credit Facility would have been 5.54% per annum. On February 7, 2025, we increased the total amount of revolving loans and commitments available under the Revolving Credit Facility from $1.96 billion to $2.35 billion and extended the maturity date to February 7, 2030. All other provisions of the Revolving Credit Facility remained unchanged. Loans Payable – Other “Loans payable – other” primarily represents purchase money mortgages on properties we acquired that the seller had financed, project-level financing, and various revenue bonds that were issued by government entities on our behalf to finance community infrastructure and our manufacturing facilities. At January 31, 2025, the weighted-average interest rate on “Loans payable – other” was 5.54% per annum. Senior Notes At January 31, 2025, we had four issues of senior notes outstanding with an aggregate principal amount of $1.60 billion. Mortgage Company Loan Facilities During fiscal 2023 and until December 2023, our wholly-owned mortgage subsidiary, Toll Brothers Mortgage Company (“TBMC”), was party to a mortgage warehousing facility that contained substantially the same terms as those described in the paragraph below. On December 5, 2023, TBMC executed a new Warehousing Agreement (“New Warehousing Agreement”) with a bank that provides for loan purchases up to $75.0 million, subject to certain sublimits. In addition, the New Warehousing Agreement, provides for an accordion feature under which TBMC may request that the aggregate commitments under the New Warehousing Agreement be increased to an amount up to $150.0 million for a short period of time. The New Warehousing Agreement is accounted for as a secured borrowing under ASC 860, “Transfers and Servicing.” TMBC is also subject to an under-usage fee based on outstanding balances, as defined in the New Warehousing Agreement. Prior to its scheduled expiration on December 3, 2024, the New Warehousing Agreement was amended to extend the expiration date to December 2, 2025. No other changes were made to the terms of the New Warehousing Agreement as a result of the amendment. The New Warehousing Agreement bears interest at SOFR plus 1.75% per annum (with a SOFR floor of 2.50%). At January 31, 2025, the interest rate on the New Warehousing Agreement was 6.09% per annum.

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