On Nov. 26, 2008, Standard&Poor's Ratings Services lowered its corporate credit and senior note ratings on KB Home to 'BB-' from 'BB'. We also lowered our rating on the company's senior subordinated notes to 'B' from 'B+'. The outlook remains negative. Our recovery ratings of '4' and '6' on the company's senior unsecured and senior subordinated debt, respectively, remain unchanged (see list). The rating actions affect $1.85 billion of rated notes. We lowered our ratings on KB Home because we expect the deteriorating economy to further pressure the company's already challenged key housing markets. Consumer confidence remains low and mortgage lending remains tight, which contributes to stubbornly high inventory levels. These conditions will further stress KB Home's already
