On November 10, 2009, Comstock Homes of Raleigh, LLC (the "Borrower") and Comstock Homebuilding Companies, Inc. (the "Company") entered into a Forbearance and Conditional Release Agreement (the "Agreement") with Fifth Third Bank, an Ohio banking corporation (the "Lender") with respect to the $1.3 million outstanding principal under the Borrower's secured Brookfield project loan (the "Loan"). Under the terms of the Agreement, Lender has released the Borrower from its obligations relating to the Loan contemporaneous with the execution by the Borrower of statutory foreclosure waivers allowing for the expeditious foreclosure of the single family building lots secured by the Loan (the "Collateral"). If Lender successfully forecloses on the Collateral on or before February 28, 2010, subject to extension, Lender shall receive a non-interest bearing unsecured deficiency note in the amount of $25,000 with a three year term (the "Deficiency Note") from the Company. The Deficiency Note shall be fully subordinate to the repayment of the secured lenders of the Company's subsidiaries. Should Lender fail to foreclose on the Collateral on or before February 28, 2010, subject to extension, the Company shall not be required to deliver the Deficiency Note but the release issued by Lender will nevertheless remain effective upon its eventual foreclosure of the Collateral.

On November 11, 2009, the Company issued a press release announcing the Modification. A copy of this press release is attached hereto as Exhibit 99.1.

(d) Exhibits

Exhibit
Number                                    Description

99.1         Press Release by Comstock Homebuilding Companies, Inc. dated November
             11, 2009.