It's easier to borrow money when you have money. Toll Brothers recently proved that by pulling off what's been nearly impossible for home builders for the last few years--issuing $400 million worth of bond debt.

"The markets have primarily been closed to our industry for three years," said Joel Rassman, Toll's executive vice president, treasurer, and CFO, "particularly since Lehman [Brothers] in September."

Toll, with roughly $1.5 billion in cash on hand, is in no real need of more liquidity. But that's the right time to seek it, said Rassman. "We don't look to access capital markets when you need money, but when we don't," he said.

So, despite owning one of the strongest balance sheets of all the public home builders, Rassman said the company has been looking for sources of capital. "We have worked patiently and hard," he said. "We monitor the markets virtually every day. I have a guy who spends an hour a day talking to people and looking at it."

But, in the end, an investment banker came to Toll asking if the company was interested in floating some bonds. "Because we have a very strong balance sheet we, at times, have interest," Rassman said.

On April 20, the company closed the offering of $400 million in senior notes due October 2017 with a coupon rate of 8.91%. The offering was underwritten by Citigroup Global Markets Inc., as sole book-running manager, and Banc of America Securities LLC and RBS Securities Inc. as co-managers.

"It got done because the capital markets were respective" of the company's strong balance sheet, Rassman said.

Toll has not specifically announced what it will do with the proceeds, other than that it could be used to repay or repurchase its other outstanding debts.

The money could be used to make the company's balance sheet even stronger by adding five years to the due date of some of its debt, said Rassman.

"Worst-case scenario," said Rassman, the company pays off the $343 million in debt the company has due in 2011, which carries an 8.25% coupon rate, effectively replacing it with the new debt that won't come due until 2017.

Rassman thinks the deal might hint at the possibility that the credit market is beginning to loosen up, saying several other large bond deals have occurred recently.

Shares of Toll (NYSE:TOL) were up 2.7% at $20.23 on normal volume in early afternoon trading.