How D.R. Horton Uses This Clause
D.R. Horton purchase agreements have been documented to include monthly payment suppression / hidden costs provisions. The builder's affiliated lender may present artificially low monthly payment estimates by temporarily buying down the interest rate or omitting escrow costs. Buyers discover the true payment amount only after closing, when the temporary rate expires and taxes and insurance are fully assessed. This clause has been the subject of litigation, including Robinson v. D.R. Horton.
This provision typically appears within the purchase agreement alongside other terms that may limit buyer remedies. This provision is closely connected to D.R. Horton's affiliated lending arm, DHI Mortgage. Because D.R. Horton operates across multiple states, the enforceability and practical impact of this clause varies depending on where the home is located.
D.R. Horton's scale means contract templates are largely standardized across its operations. A clause identified in one market's contract is likely present in other markets' contracts, though local addenda may modify the terms.
Builder-Specific Details
Combined with Deposit Forfeiture
Buyers who discover true costs after signing face forfeiting their deposit if they back out.
Standardized Across Markets
D.R. Horton's scale means contract templates are largely standardized across its operations. This clause identified in one state's contract is likely present in other states' contracts, though local addenda may modify the terms.
Connection to DHI Mortgage
D.R. Horton operates DHI Mortgage as an affiliated lending arm. The builder may offer financial incentives for buyers who use this lender, which creates a direct connection between the lending relationship and the terms of the purchase agreement.
Legal History
The following cases involve D.R. Horton's use of this clause type.
Robinson v. D.R. Horton
A class action in which plaintiffs allege that D.R. Horton and its affiliated lender DHI Mortgage operated a "Monthly Payment Suppression Scheme" that presented buyers with artificially low monthly payment estimates. Plaintiffs are represented by Clarkson Law Firm, Varnell & Warwick, and the National Consumer Law Center.
Santiago v. D.R. Horton
A RICO case in which the plaintiff alleges that monthly mortgage payments increased by nearly $1,000 less than a year after closing. The complaint alleges the builder and affiliated lender structured the transaction to conceal the true cost of homeownership.
State-by-State Enforceability
Enforceability of this clause varies by state. The following reflects D.R. Horton's operating states.
| State | Status | Note |
|---|---|---|
| Texas | Uncertain | Texas does not have a specific statute addressing monthly payment suppression in new construction... |
| Florida | Uncertain | Florida does not have a specific statute addressing monthly payment suppression in builder... |
| South Carolina | Uncertain | South Carolina does not have a specific statute addressing monthly payment suppression in builder... |
| North Carolina | Uncertain | North Carolina does not have a specific statute addressing monthly payment suppression in builder... |
| Arizona | Uncertain | Arizona does not have a specific statute addressing monthly payment suppression in builder... |
| Georgia | Uncertain | Georgia does not have a specific statute addressing monthly payment suppression in builder... |
| Colorado | Uncertain | Colorado does not have a specific statute targeting monthly payment suppression in builder... |
| Nevada | Uncertain | Nevada does not have a specific statute addressing monthly payment suppression in builder marketing.... |
| California | Likely Unenforceable | California has some of the strongest consumer protection statutes in the country, and its Mello-Roos... |
| Virginia | Uncertain | Virginia does not have a specific statute addressing monthly payment suppression in builder... |
| Tennessee | Uncertain | Tennessee does not have a specific statute addressing monthly payment suppression in builder... |
| Alabama | Uncertain | Alabama does not have a specific statute addressing monthly payment suppression in builder... |
| Maryland | Uncertain | Maryland does not have a specific statute addressing monthly payment suppression in builder... |
| Louisiana | Uncertain | Louisiana does not have a specific statute addressing monthly payment suppression in builder... |
| Hawaii | Uncertain | Hawaii does not have a specific statute addressing monthly payment suppression in builder marketing.... |
Related Clauses in D.R. Horton Contracts
This clause often works in combination with other provisions in D.R. Horton's purchase agreements.
Buyers who discover true costs after signing face forfeiting their deposit if they back out.
Closing penalties discourage buyers from delaying to investigate payment discrepancies.
What Buyers Can Do
- Independently verify your projected monthly payment. Do not rely solely on estimates from DHI Mortgage. Get a loan estimate from at least one independent lender for comparison.
- Ask about temporary rate buydowns. Determine whether any quoted rate includes a temporary buydown that will expire, causing your payment to increase after the introductory period.
- Review the Robinson case. The Robinson v. D.R. Horton ruling may be relevant to your situation. If you are buying a D.R. Horton home in a state with similar legal protections, this precedent could affect the enforceability of this clause.
- Have the full contract scanned before signing. This clause is often one of several interconnected provisions in D.R. Horton contracts that collectively limit buyer remedies. A contract scan can identify all of them.