Fidelity Title Calls Off the LandAmerica Merger

Update: Since I wrote this post, Fidelity is back on with the LandAmerica merger (11/26/2008).

LandAmerica has released a statement to the public regarding this recent debacle which has many wondering what will happen to this large title insurance underwriter.   As I write this post, their stock is sitting at $0.54 a share.  LandAm’s 52 week high is $53. 

From Inman News:

The deal was announced on a Friday. The following Monday, LandAmerica detailed record third-quarter losses and said the company was in violation of financial debt covenants of its note-purchase agreement and credit agreement (see story).

LandAmerica said it was in discussion with creditors to obtain waivers. If not waived, the covenant violations “constitute an event of default under the agreements, giving the lenders the right to declare all principal and accrued interest payable immediately,” LandAmerica said at the time.

LandAmerica’s public statement, which is in a question and answer format clearly states that their ability to pay claims is adequately covered by the reserves.   Locally, LandAmerica has joint ventures with Commonwealth of the Puget Sound  (Windermere), Rainier Title (John L. Scott and Coldwell Bank Bain) and Northpoint Title.   From the statement:

What about other LandAmerica entities?

LandAmerica is comprised of many separate legal subsidiaries with separate profit and loss statements.  Some entities are performing well and others are not performing well.  We are working closely with the Nebraska Department of Insurance, which is where major underwriters are domiciled, to resolve our situation in a way that benefits our policyholders.”

This leaves a bigger question of what percentage of ownership does LandAmerica have in these joint ventures and what will happen to these ownership shares?

What is the financial viabililty of LandAmerican underwriters?

The LandAmerica underwriters, Lawyers Title and Commonwealth have over $300 million in combined statutory surplus.  And we have some of the industry’s most stringent requirements for reserves in place to protect our policyholders.  The LandAmerica underwriters’ claims reserves are backed by over $1.1 billion in cash and investments.”

Reserves are mandetory…what about operating expenses?

Moving Forward…

I’ve been a little busy lately, so I haven’t had a lot of time to give an update on some of my favorite conversations around the web… Nonetheless, I’m back for an abrivated version (i.e. only 9 articles instead of the usual 10)…

Beau turned me on to a great article by Jay regarding the 30-year trend for Mortgage Rates… Interesting stuff. Also, don’t miss Jay’s tribute to Harry Ramos

I just got an email from someone at Windermere letting me know about Windermere’s new (beta) mapping platform… This is an update to the beta mapping platform they released a little over a year ago and I think they’ve made some great improvements… Here are some features I like: (1) Simple map-based search, (2) intuitive zoom feature, (3) Simple pop-up interface, (4) the filter tool is relatively straightforward, (5) viewing the details doesn’t require a page reload, (6) same with viewing the “list of homes”, (7) saving, emailing and/or contacting an agent can all be done without leaving the map view (8) simple city, state, zip box allows for easy navigation to distant locations… The only complaint I have is that the design doesn’t feel polished, but considering it is a beta and the technology works well, the design is minor…

Steve Weise also let me know about his map-based appraisal tool he recently released and asked me to solicit feedback from the RCG community… His interface is too GIS-specific for my tastes, but maybe other’s will find it interesting and/or useful.

Clever, but probably too simplistic, Rob let me know about his collection of quotes that compare the great depression to today’s housing market. Any way you look at it, he provides a good read…

Greg picked up the new Move commercials on YouTube… The latest fun news around Move is that my favorite commercial (Search) got picked up by AdForum and is currently displayed on their front page!

I really like how Zachary picked up the ball and started posting videos of his properties… They are not high art, but I think they are darn useful, especially for someone selling land in such a beautiful area!

Sometimes being a great agent means divulging the good with the bad… Osman tells us how people can and do loose money in real estate

I hate homework too!!!

The NYTimes real estate blog is officially dead. (although it is everywhere now, I first saw it on Luxury Sarasota Living). I can’t say I’m particularly sad, because the main editor seemed to have such a thing against real estate agents that his blogging on the subject just wasn’t very interesting… (Marlow also noticed this tendency of Damon).