Exhibit 10.1

THIRD AMENDMENT

CREDIT AGREEMENT

Dated as of April 20, 2004

among

MERITAGE CORPORATION,

as the Borrower

GUARANTY BANK,

as Administrative Agent and Swing Line Lender,

BANK ONE, NA,

as Syndication Agent

FLEET NATIONAL BANK,

as Documentation Agent

and

The Other Lenders Party Thereto

GUARANTY BANK,

as Joint Lead Arranger and Joint Book Manager

and

BANC ONE CAPITAL MARKETS, INC.,

as Joint Lead Arranger and Joint Bank Manager

THIRD AMENDMENT TO CREDIT AGREEMENT

THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this “Third Amendment”), dated as of April 20, 2004, is entered into among MERITAGE CORPORATION, a Maryland corporation (the “Borrower”), the lenders listed on the signature pages hereof as Lenders (the “Lenders”), GUARANTY BANK, as Administrative Agent and Swing Line Lender, BANK ONE, NA, as Syndication Agent, and FLEET NATIONAL BANK, as Documentation Agent.

BACKGROUND

A. The Borrower, certain of the Lenders, the Syndication Agent, the Documentation Agent, the Administrative Agent and the Swing Line Lender are parties to that certain Credit Agreement, dated as of December 12, 2002, as amended by that certain First Amendment to Credit Agreement, dated as of September 8, 2003, and that certain Second Amendment to Credit Agreement, dated as of December 3, 2003 (said Credit Agreement, as amended, the “Credit Agreement”). The terms defined in the Credit Agreement and not otherwise defined herein shall be used herein as defined in the Credit Agreement.

B. The Borrower has requested an amendment to increase the Letter of Credit Sublimit under the Credit Agreement.

C. The Lenders, the Syndication Agent, the Documentation Agent, the Administrative Agent and the Swing Line Lender hereby agree to amend the Credit Agreement, subject to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the covenants, conditions and agreements hereafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are all hereby acknowledged, the Borrower, the Lenders, the Syndication Agent, the Documentation Agent, the Swing Line Lender and the Administrative Agent covenant and agree as follows:

1. AMENDMENT. The definition of “Letter of Credit Sublimit” set forth in Section 1.01 of the Credit Agreement is hereby amended to read as follows:

“Letter of Credit Sublimit” means an amount equal to $150,000,000. The Letter of Credit Sublimit is part of, and not in addition to, the Aggregate Commitments.

2. REPRESENTATIONS AND WARRANTIES TRUE; NO EVENT OF DEFAULT. By its execution and delivery hereof, the Borrower represents and warrants that, as of the date hereof:

(a) the representations and warranties contained in the Credit Agreement and the other Loan Documents are true and correct on and as of the date hereof as made on and as of such date;

(b) no event has occurred and is continuing which constitutes a Default or an Event of Default;

(c) (i) the Borrower has full power and authority to execute and deliver this Third Amendment, (ii) this Third Amendment has been duly executed and delivered by the Borrower, and (iii) this Third Amendment and the Credit Agreement, as amended hereby, constitute the legal, valid and binding obligations of the Borrower, enforceable in accordance with their respective terms, except as enforceability may be limited by applicable debtor relief laws and by general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and except as rights to indemnity may be limited by federal or state securities laws;

(d) neither the execution, delivery and performance of this Third Amendment or the Credit Agreement, as amended hereby, nor the consummation of any transactions contemplated herein or therein, will conflict with any Law or Organization Documents of the Borrower, or any indenture, agreement or other instrument to which the Borrower or any of its properties are subject; and

(e) no authorization, approval, consent, or other action by, notice to, or filing with, any governmental authority or other Person not previously obtained is required for (i) the execution, delivery or performance by the Borrower of this Third Amendment or (ii) the acknowledgement by each Guarantor of this Third Amendment.

3. CONDITIONS TO EFFECTIVENESS. This Third Amendment shall be effective upon satisfaction or completion of the following:

(a) the Administrative Agent shall have received counterparts of this Third Amendment executed by Lenders comprising the Required Lenders;

(b) the Administrative Agent shall have received counterparts of this Third Amendment executed by the Borrower and acknowledged by each Guarantor;

(c) the Administrative Agent shall have received a certified resolution of the Board of Directors of the Borrower authorizing the execution, delivery and performance of this Third Amendment; and

(d) the Administrative Agent shall have received, in form and substance satisfactory to the Administrative Agent and its counsel, such other documents, certificates and instruments as the Administrative Agent shall require.

4. REFERENCE TO THE CREDIT AGREEMENT.

(a) Upon the effectiveness of this Third Amendment, each reference in the Credit Agreement to “this Agreement”, “hereunder”, or words of like import shall mean and be a reference to the Credit Agreement, as affected and amended hereby.

(b) The Credit Agreement, as amended by the amendments referred to above, shall remain in full force and effect and is hereby ratified and confirmed.

5. COSTS, EXPENSES AND TAXES. The Borrower agrees to pay on demand all costs and expenses of the Administrative Agent in connection with the preparation, reproduction,

execution and delivery of this Third Amendment and the other instruments and documents to be delivered hereunder (including the reasonable fees and out-of-pocket expenses of counsel for the Administrative Agent with respect thereto).

6. GUARANTOR’S ACKNOWLEDGMENT. By signing below, each Guarantor (a) acknowledges, consents and agrees to the execution, delivery and performance by the Borrower of this Third Amendment, (b) acknowledges and agrees that its obligations in respect of its Guaranty are not released, diminished, waived, modified, impaired or affected in any manner by this Third Amendment or any of the provisions contemplated herein, (c) ratifies and confirms its obligations under its Guaranty, and (d) acknowledges and agrees that it has no claims or offsets against, or defenses or counterclaims to, its Guaranty.

7. EXECUTION IN COUNTERPARTS. This Third Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which when taken together shall constitute but one and the same instrument. For purposes of this Third Amendment, a counterpart hereof (or signature page thereto) signed and transmitted by any Person party hereto to the Administrative Agent (or its counsel) by facsimile machine, telecopier or electronic mail is to be treated as an original. The signature of such Person thereon, for purposes hereof, is to be considered as an original signature, and the counterpart (or signature page thereto) so transmitted is to be considered to have the same binding effect as an original signature on an original document.

8. GOVERNING LAW; BINDING EFFECT. This Third Amendment shall be governed by and construed in accordance with the laws of the State of Texas applicable to agreements made and to be performed entirely within such state, provided that each party shall retain all rights arising under federal law, and shall be binding upon the parties hereto and their respective successors and assigns.

9. HEADINGS. Section headings in this Third Amendment are included herein for convenience of reference only and shall not constitute a part of this Third Amendment for any other purpose.

10. ENTIRE AGREEMENT. THE CREDIT AGREEMENT, AS AMENDED BY THIS THIRD AMENDMENT, AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

REMAINDER OF PAGE LEFT INTENTIONALLY BLANK

IN WITNESS WHEREOF, this Third Amendment is executed as of the date first set forth above.

MERITAGE CORPORATION


By:	/s/ Larry W. Seay
	Name:	Larry W. Seay
	Title:	Vice President and Secretary

GUARANTY BANK, as Administrative Agent


By:	/s/ Sam A. Meade
	Name:	Sam A. Meade
	Title:	Senior Vice President


By:	/s/ Sam A. Meade
	Name:	Sam A. Meade
	Title:	Senior Vice President

FLEET NATIONAL BANK, as a Lender and Documentation Agent


By:	/s/ Daniel L. Silbert
	Name:	Daniel L. Silbert
	Title:	Director

BANK ONE, NA, as a Lender and Syndication Agent


By:	/s/ Paul Engler
	Name:	Paul Engler
	Title:	First Vice President

WELLS FARGO BANK ARIZONA NATIONAL ASSOCIATION, as a Lender


By:	/s/ Patricia A. Richards
	Name:	Patricia A. Richards
	Title:	Vice President

U.S. BANK NATIONAL ASSOCIATION, as a Lender


By:	/s/ Adrian Montero
	Name:	Adrian Montero
	Title:	Assistant Vice President

CALIFORNIA BANK AND TRUST, as a Lender


By:	/s/ Stephanie Lantz
	Name:	Stephanie Lantz
	Title:	Vice President

COMPASS BANK, as a Lender


By:	/s/ Steven J. Heslep
	Name:	Steven J. Heslep
	Title:	S.V.P.

COMERICA BANK, as a Lender


By:	/s/ Casey L. Ostrander
	Name:	Casey L. Ostrander
	Title:	Vice President

PNC BANK, NATIONAL ASSOCIATION, as a Lender


By:	/s/ Douglas G. Paul
	Name:	Douglas G. Paul
	Title:	Senior Vice President

SOUTHTRUST BANK, as a Lender


By:	/s/ Samuel L. Boroughs
	Name:	Samuel L. Boroughs
	Title:	VP

	ACKNOWLEDGED AND AGREED TO:

	MONTEREY HOMES ARIZONA, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	MONTEREY HOMES CONSTRUCTION, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	MERITAGE HOMES OF ARIZONA, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	MERITAGE PASEO CROSSING, LLC

	By:	Meritage Homes of Arizona, Inc., its Sole
		Member


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary

	MERITAGE HOMES CONSTRUCTION, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	MERITAGE PASEO CONSTRUCTION, LLC

	By:	Meritage Homes Construction, Inc., its Sole
		Member


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	HANCOCK-MTH COMMUNITIES, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	HANCOCK-MTH BUILDERS, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary

	MTH-TEXAS GP, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary

	MTH-TEXAS LP, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	LEGACY/MONTEREY HOMES L.P.

	By:	MTH-Texas GP, Inc., its General Partner


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	MERITAGE HOLDINGS, L.L.C.

	By:	Legacy/Monterey Homes L.P., its Sole
		Member

	By:	MTH-Texas GP, Inc., its General Partner


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary

	LEGACY OPERATING COMPANY, L.P.

	By:	Meritage Holdings, L.L.C., its General
		Partner

	By:	Legacy/Monterey Homes L.P., its Sole
		Member

	By:	MTH-Texas GP, Inc., its General Partner


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	HULEN PARK VENTURE, LLC

	By:	Legacy/Monterey Homes L.P., its Sole
		Member

	By:	MTH-Texas GP, Inc., its General Partner


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary

	MTH-TEXAS GP II, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary

	MTH-TEXAS LP II, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	MTH HOMES-TEXAS, L.P.

	By:	MTH-Texas GP II, Inc., its General Partner


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	MERITAGE HOMES OF CALIFORNIA, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	MTH-HOMES NEVADA, INC.


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary

	MTH-CAVALIER, LLC

	By:	Monterey Homes Construction, Inc., its
		Sole Member


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	MTH GOLF, LLC

	By:	Hancock-MTH Builders, Inc., its Sole
		Member


	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary


	LEGACY-HAMMONDS MATERIALS, L.P.

	By:	Meritage Holdings, L.L.C., its General
		Partner

	By:	Legacy/Monterey Homes L.P., its Sole
		Member

	By:	MTH-Texas GP, Inc., its General Partner

	By:	/s/ Larry W. Seay
		Larry W. Seay
		Vice President and Secretary