Overview
| Parent Company | MDC Holdings, Inc. |
| Stock Ticker | NYSE: MDC |
| Headquarters | Denver, Colorado |
| Founded | 1972 |
| Affiliated Lender | HomeAmerican Mortgage Corporation |
| FY2024 Closings | Approximately 8,000–9,000 homes |
| FY2024 Revenue (MDC Holdings) | Approximately $5 billion |
| Operating States | CO, AZ, NV, CA, OR, WA, UT, ID, FL, MD, VA |
Richmond American Homes is the homebuilding subsidiary of MDC Holdings, Inc., a publicly traded company on the New York Stock Exchange under the ticker MDC. Founded in 1972 and headquartered in Denver, Colorado, the company builds single-family detached and attached homes across approximately 11 states, with a concentration in western U.S. markets including Colorado, Arizona, Nevada, California, Oregon, Washington, Utah, and Idaho, along with operations in Florida, Maryland, and Virginia.
MDC Holdings operates an affiliated mortgage lender, HomeAmerican Mortgage Corporation, which provides financing to Richmond American buyers. The company also maintains affiliated title and insurance service providers. According to MDC Holdings' SEC filings, buyers are not required to use affiliated service providers as a condition of purchase, though incentive structures may favor their use.
Documented Contract Patterns
The following patterns have been documented in Richmond American Homes purchase agreements. Not every contract contains every clause, and language varies by state and community.
Implied Warranty of Habitability Waiver
Richmond American purchase agreements have included language disclaiming implied warranties, including the implied warranty of habitability, substituting the builder's own limited warranty program. Enforceability varies by state; Colorado courts have recognized an implied warranty of suitability in new residential construction that may limit the effectiveness of such waivers.
Mandatory Binding Arbitration
Richmond American contracts have included mandatory arbitration provisions requiring disputes to be resolved through private arbitration rather than in court. This eliminates the buyer's right to a jury trial and may limit discovery and appeal options available in traditional litigation.
Class Action Lawsuit Waiver
The arbitration provisions in Richmond American contracts may include a waiver of the right to participate in class action proceedings. This forces buyers to pursue claims individually, which can be cost-prohibitive for defects affecting entire communities or subdivisions.
Deposit Forfeiture / Earnest Money Trap
The contract may characterize earnest money deposits as non-refundable upon buyer non-performance. Buyers who fail to close for any reason, including inability to obtain financing through outside lenders after declining HomeAmerican Mortgage, may forfeit their deposits.
Limitation of Liability / No Monetary Damages
The contract may limit the builder's liability for monetary damages resulting from construction defects, delays, or contract breaches. This can restrict buyers' recovery to repair of the specific defect rather than consequential damages such as alternative housing costs or diminished property value.
Daily Closing Penalty
If the buyer cannot close by the contractually specified date, the agreement may impose per-day financial penalties. These charges can accumulate even when delays are attributable to the builder's own affiliated lender, HomeAmerican Mortgage Corporation.
Independent Inspection Restriction
The contract may restrict the timing, scope, or conditions under which buyers may conduct independent inspections. This can limit buyers' ability to identify construction defects before closing or during the warranty period.
Material Substitution at Builder's Discretion
The builder reserves the right to substitute materials, fixtures, or appliances with alternatives deemed equivalent at the builder's sole discretion. Buyers may receive different products than those shown in the model home or specified during the selection process.
Restrictive Limited Warranty Exclusions
Richmond American's warranty program contains extensive exclusion lists that may narrow the scope of covered defects. Common issues such as cosmetic imperfections, drainage, settling, and certain HVAC performance concerns may fall outside the warranty's scope.
Legal History
Selected cases and investigations involving Richmond American Homes construction quality, contract enforcement, and lending practices.
Colorado Construction Defect Litigation — Multiple Homeowner Actions
Richmond American Homes and MDC Holdings have been named in construction defect lawsuits filed by homeowners and homeowners' associations in Colorado. Claims have alleged defective construction including foundation issues, water intrusion, and exterior system failures. Colorado's Construction Defect Action Reform Act (CDARA) governs the pre-litigation notice-and-repair process for these claims.
HomeAmerican Mortgage Corporation — CFPB Settlement
HomeAmerican Mortgage Corporation, the affiliated lender of MDC Holdings, settled with the Consumer Financial Protection Bureau over allegations related to affiliated business arrangement disclosures and referral practices. The settlement addressed concerns about the relationship between the builder's homebuilding and mortgage operations.
MDC Holdings Securities and Regulatory Matters
MDC Holdings has disclosed litigation reserves in its SEC filings related to construction defect claims, warranty disputes, and other matters arising in the ordinary course of its homebuilding operations. The company's annual reports document ongoing legal proceedings across multiple states.
What Buyers Should Know
- Hire an independent home inspector before closing. Most state laws protect a buyer's right to inspect. If the Richmond American contract restricts inspection timing or scope, document any resistance from the builder in writing. Consider pre-drywall, pre-closing, and final walkthrough inspections.
- Understand the arbitration clause before signing. Richmond American contracts have included mandatory arbitration provisions. Know whether the clause in your contract is enforceable under your state's law and whether you can negotiate its removal or modification.
- Know your earnest money refund rights. Richmond American contracts may treat earnest money as non-refundable upon buyer non-performance. Understand under what circumstances — including financing contingencies — you may be entitled to a refund under your state's consumer protection statutes.
- Compare HomeAmerican Mortgage with outside lenders. Richmond American offers incentives for using HomeAmerican Mortgage Corporation. Compare rates, fees, and loan terms with at least two independent lenders. Verify that any quoted monthly payment includes taxes, insurance, and HOA assessments.
- Review the warranty exclusion list carefully. The builder's limited warranty contains extensive exclusions. Identify which defect categories are covered and for how long. Common issues such as cosmetic imperfections, drainage, and HVAC performance may fall outside the warranty's scope.
- Request documentation on material substitutions. If the builder substitutes materials, fixtures, or appliances from what was shown in the model home or specified during selections, request written documentation of what was changed and why. Verify that substitutions meet the same specifications.
- Consider a professional contract review. Whether through a real estate attorney or a contract analysis service, an independent review can identify clauses that limit your remedies or waive rights you may not realize you have — including warranty exclusions and liability caps.
Detailed Clause Analysis
Deep-dive analysis of how Richmond American Homes uses specific contract clauses:
State-Specific Guides
See how Richmond American Homes's contract patterns interact with the laws in your state: