Domestic Homebuilding
We build a wide variety of homes, including single family detached units, townhouses,
condominiums and duplexes, with varying prices, models, options and lot sizes.
Since 1990, we have more than quadrupled our annual unit closings, unit orders
and unit backlog levels. Including 2003 settlements of nearly 33,000 homes,
we have closed more than 370,000 homes since our inception.
International Homebuilding
Our International Homebuilding operations are principally conducted through
subsidiaries of International in Mexico, Puerto Rico and Argentina. International
Homebuilding product offerings focus on the demand of first-time buyers and
middle-to-upper income consumer groups. Effective January 1, 2002, International
reorganized its structure within Mexico to create a single company, Pulte Mexico
S. de R.L. de C.V., which ranks as one of the largest builders in the country.
Prior to the reorganization, these operations were conducted primarily through
five joint ventures throughout Mexico.
We select locations for development of homebuilding communities after completing
extensive market research, enabling us to match the location and product offering
with our targeted consumer group. We consider factors such as proximity to developed
areas, population and job growth patterns and, if applicable, estimated development
costs. We historically have managed the risk of controlling our land positions
through use of option contracts and outright acquisition.
We typically control land with the intent to complete sales of housing units
within 24 to 36 months from the date of opening a community, except in the case
of certain active adult developments and our Del Webb operations for which the
completion of community build out requires a longer time period due to typically
larger project sizes. As a result, land is generally purchased after it is properly
zoned and developed or is ready for development. In addition, we dispose of
owned land not required in the business through sales to appropriate end users.
Where we develop land, we engage directly in many phases of the development
process, including land and site planning, obtaining environmental and other
regulatory approvals, as well as constructing roads, sewers, water and drainage
facilities and other amenities.
We use our staff and the services of independent engineers and consultants
for land development activities. Land development work is performed primarily
by independent contractors and local government authorities who construct sewer
and water systems in some areas.
Financial Services Operations
We conduct our financial services business, which includes mortgage and title
operations, through Pulte Mortgage and other subsidiaries.
Mortgage banking
Our mortgage bank arranges financing through the origination of mortgage loans
primarily for the benefit of our domestic homebuyers, but also services the
general public. We also engage in the sale of such loans and the related servicing
rights. We are a lender approved by the FHA and VA and are a seller/servicer
approved by Government National Mortgage Association (GNMA), Federal National
Mortgage Association (FNMA), Federal Home Loan Mortgage Corporation (FHLMC)
and other investors. In our conventional mortgage lending activities we follow
underwriting guidelines established by FNMA and FHLMC.
Our mortgage underwriting, processing and closing functions are centralized
in Denver, Colorado using a mortgage operations center (MOC) concept. We also
use a centralized telephone loan officer concept where loan officers are centrally
located at a mortgage application center (MAC) in Denver. Our sales representatives,
who are the mortgage customers’ main contact, forward the loan applications
to a MAC loan counselor who calls the customer to complete the loan application
and then forwards it to the MOC for processing. We believe both the MOC and
the MAC improve the speed and efficiency of our mortgage operations, thereby
improving our profitability and allowing us to focus on creating attractive
mortgage financing opportunities for our customers.
In originating mortgage loans, we initially use our own funds and borrowings
made available to us through various credit arrangements. Subsequently, we sell
such mortgage loans and mortgage-backed securities to outside investors.