7) Bank and Other Loans Payable

12 Months Ended

Dec. 31, 2020

Debt Disclosure [Abstract]

7) Bank and Other Loans Payable

7)       Bank and Other Loans Payable

Bank and other loans payable are summarized as follows:

	December 31
	2020	2019
2.25% above the monthly LIBOR rate plus 1/16th of the monthly LIBOR rate note payable in    monthly principal payments of $13,167 plus interest, collateralized by real property, paid in    full November 2020.	$               -	$    2,659,769
4.27% fixed note payable in monthly installments of $53,881 including principal and interest,     collateralized by shares of Security National Life Insurance Company stock, due     December 2021.	633,890	1,238,619
Prime rate note payable in monthly installments of $75,108 including principal and interest,    collateralized by shares of Security National Life Insurance Company stock, due    December 2024.	3,257,113	4,000,000
4.40% fixed note payable in monthly installments of $46,825 including principal and interest,     collateralized by real property, paid in full April 2020.	-	7,247,651
4.329% fixed note payable in monthly installments of $9,775 including principal and interest,    collateralized by real property with a book value of approximately $3,174,000, due    September 2025.	1,861,920	1,896,450
2.5% above the monthly LIBOR rate plus 1/16th of the monthly LIBOR rate construction loan    payable in monthly principal payments of $113,000 plus interest, collateralized by real property   with a book value of approximately $50,689,000, due March 2021.	35,091,364	33,811,559
4.7865% fixed interest only note payable in monthly installments, collateralized by real property    with a book value of approximately $17,655,000, due June 2028.	9,200,000	9,200,000
1 month LIBOR rate plus 2.1% loan purchase agreement with a warehouse line availability of    $150,000,000, matures June 2021.	116,598,834	88,509,536
1 month LIBOR rate plus 3% loan purchase agreement with a warehouse line availability of    $175,000,000, matures November 2021.	68,766,572	67,537,600
1 month LIBOR rate plus 2.5% loan purchase agreement with a warehouse line availability of    $90,000,000, matures May 2021.	60,715,374	-
1 month LIBOR rate plus 2.5% loan purchase agreement with a warehouse line availability of    $5,000,000, matures August 2021.	317,582	-
Other short-term borrowings (1)	1,250,000	1,250,000
Finance lease liabilities	104,951	153,439
Other loans payable	26,768	67,989
Total bank and other loans	297,824,368	217,572,612
Less current installments	284,250,996	192,985,602
Bank and other loans, excluding current installments	$   13,573,372	$  24,587,010
(1) Revolving Line of Credit

Sources of Liquidity

Federal Home Loan Bank Membership

The Federal Home Loan Banks (“the FHLBs”) are a group of cooperatives that lending institutions use to finance housing and economic development in local communities.  The Company is a member of the FHLB based in Des Moines, Iowa and based in Dallas, Texas.  As a member of the FHLB, the Company is required to maintain a minimum investment in capital stock of the FHLB and may pledge collateral to the bank for advances of funds to be used in its operations. 

Federal Home Loan Bank of Des Moines

At December 31, 2020, the amount available for borrowings from the FHLB of Des Moines was approximately $39,102,336, compared with $57,727,738 at December 31, 2019. United States Treasury fixed maturity securities with an estimated fair value of $40,729,400 at December 31, 2020 have been pledged at the FHLB of Des Moines as collateral for current and potential borrowings compared with $59,877,900 at December 31, 2019. At December 31, 2020 and 2019, the Company had no outstanding FHLB borrowings. At December 31, 2020, the Company’s total investment in FHLB stock was $786,300 compared with $806,500 at December 31, 2019. The Company’s decreased investment in FHLB stock was a result of its decrease in short-term FHLB borrowings during 2020.

Federal Home Loan Bank of Dallas

The membership of the FHLB of Dallas was acquired with the acquisition of Kilpatrick Life Insurance Company. See Note 20 regarding this acquisition. At December 31, 2020, the Company’s total investment in FHLB stock was $1,720,300 compared with $87,800 at December 31, 2019. The Company does not have any collateral pledged at the FHLB of Dallas or any outstanding borrowings.

Revolving Lines of Credit

The Company has a $2,000,000 revolving line-of-credit with a bank with interest payable at the prime rate minus .75%, secured by the capital stock of Security National Life and maturing September 30, 2021, renewable annually. At December 31, 2020, the Company was contingently liable under a standby letter of credit aggregating $348,183, to be used as collateral to cover any contingency related to additional risk assessments pertaining to the Company's captive insurance program and was contingently liable under standby letters of credit aggregating $1,585,063, to be used as collateral for residential subdivision land developments. The standby letters of credit will draw on the line of credit if necessary. The Company does not expect any material losses to result from the issuance of the standby letters of credit. As of December 31, 2020, there were no amounts outstanding under the revolving line-of-credit.

The Company also has a $2,500,000 revolving line-of-credit with a bank with interest payable at the overnight LIBOR rate plus 2.25% maturing September 30, 2021. As of December 31, 2020, there was $1,250,000 outstanding under the revolving line-of-credit.

Debt Covenants for Mortgage Warehouse Lines of Credit

The Company, through its subsidiary SecurityNational Mortgage, has a $150,000,000 line of credit with Wells Fargo Bank N.A. The agreement charges interest at the 1-Month LIBOR rate plus 2.1% and matures on June 24, 2021. SecurityNational Mortgage is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, the ratio of indebtedness to adjusted tangible net worth, and the liquidity overhead coverage ratio, and a quarterly gross profit of at least $1.00.

The Company, through its subsidiary SecurityNational Mortgage, has a line of credit with Texas Capital Bank N.A. This agreement with the bank allows SecurityNational Mortgage to borrow up to $175,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 3% and matures on November 15, 2021. The Company is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, and minimum combined pre-tax income (excluding any changes in the fair value of mortgage servicing rights) of at least $1.00 on a rolling four-quarter basis.

The Company through its subsidiary SecurityNational Mortgage, has a line of credit with Comerica Bank. This agreement with the bank allows SecurityNational Mortgage to borrow up to $90,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 2.5% and matures on May 27, 2021. The Company is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, and minimum combined pre-tax income (excluding any changes in the fair value of mortgage servicing rights) of at least $1.00 on a rolling twelve months.

The Company, through its subsidiary EverLEND Mortgage, has a line of credit with Texas Capital Bank N.A. This agreement with the bank allows EverLEND Mortgage to borrow up to $5,000,000 for the sole purpose of funding mortgage loans. The agreement charges interest at the 1-Month LIBOR rate plus 2.5% and matures on August 1, 2021. The Company is required to comply with covenants for adjusted tangible net worth, unrestricted cash balance, and minimum combined pre-tax income (excluding any changes in the fair value of mortgage servicing rights) of at least $1.00 on a rolling four-quarter basis.  

The agreements for warehouse lines include cross default provisions in that a covenant violation under one agreement constitutes a covenant violation under the other agreement. As of December 31, 2020, the Company believes that it was in compliance with all debt covenants.

The following tabulation shows the combined maturities of bank and other loans payable:

2021	$  284,242,327
2022	884,383
2023	926,186
2024	937,315
2025	1,634,157
Thereafter	9,200,000
Total	$  297,824,368

Interest expense in 2020 and 2019 was $8,578,810 and $7,386,688, respectively. Interest paid in 2020 and 2019 was $8,385,270 and $7,284,078, respectively.