Disaster Fund – Gosic http://gosic.org/ Mon, 21 Nov 2022 05:39:21 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://gosic.org/wp-content/uploads/2021/06/icon-2-150x150.png Disaster Fund – Gosic http://gosic.org/ 32 32 An important catalyst to foster financial inclusion for women MSMEs https://gosic.org/an-important-catalyst-to-foster-financial-inclusion-for-women-msmes/ Mon, 21 Nov 2022 05:39:21 +0000 https://gosic.org/an-important-catalyst-to-foster-financial-inclusion-for-women-msmes/

Enabling the growth of MSMEs through innovation, technology and policy has been a priority for the economy. But this growth story has overlooked a key demographic – women entrepreneurs who represent 20% of the MSME sector. These are mainly one-man businesses, which provide direct employment for a 22 to 27 million people. Bath & Company projects that female entrepreneurs can create 150-170 million jobs for the working-age population by 2030. Instinctively, empowering these MSMEs will lead to positive socio-economic and personal outcomes.

For that, we need to address its most glaring pain point, which according to a study titled “What women MSMEs want”, raises capital. According to data from International Finance Corporation (IFC)the credit gap for women-owned MSMEs currently stands at $158 billion (about Rs 12 lakh crore).

The gender divide in access to cormal finance

An overwhelming majority of women entrepreneurs, 90% to be exact, use informal sources of finance such as loans from family and friends, cash vouchers, informal savings clubs, etc. In most scenarios, compared to their male counterparts, female entrepreneurs end up being disadvantaged. This is the result of certain socio-cultural barriers that they exclusively face:

  • Subconscious bias in formal systems

There is a negative bias that perceives women-owned businesses are riskier and women entrepreneurs have a higher loan application rejection rate. It’s even when to research confirms that women are more disciplined borrowers than men and have a better credit profile.

There is great inequality in the inheritance that women receive and simply the limited access to assets and property so that they can take out a loan against collateral. There are also cultural constraints such as the unequal distribution of unpaid household chores, lack of security and limited mobility that prevent a woman from approaching a physical lender to access credit.

Women MSMEs tend to be unaware of the financing options available, the pros and cons, as well as the costs of the various options, the benefits of borrowing, etc. This lack of knowledge and awareness, especially in small towns, generates reluctance to access funding through formal channels.

How Technology is Bridging the Gap

Technology has undeniably become a key driver of sustainable economic development in businesses and households. This speaks directly to the fact that there is an explosive increase in the number of homebuilders-turned-entrepreneurs, which has been spurred by growing internet penetration and digitalization of supply chain management.

The existence and development of online aggregation platforms has also been a boon for these entrepreneurs. They can manage the majority of their business operations from the comfort of their homes. It is also a factor that gives them the confidence to run their business due to the increased visibility and reach of these platforms in the market, as well as connections from digital providers and lenders. Digital lenders have deep integration into these platforms with a complete digital journey from loan initiation to disbursement, enabling easy access to credit for women entrepreneurs to overcome cultural disparity and their key barriers when it comes to is to begin their credit journey.

Another benefit directly related to access to credit is the information and help they get from these platforms; they can explore and receive information on what’s new in the market, available lenders on platforms, financing options, terms, etc., bridging the financial literacy gap. The digital lenders themselves provide easy and quick access to information in addition to what is available on the platforms through FAQs, self-explanatory videos, chatbots, WhatsApp support, and more. enabling a smooth flow of information through cost-effective channels. dissemination of credit and its information.

Confident in the understanding and usefulness of financial products by women entrepreneurs, digital lenders offer gender-neutral risk assessment through AI-based algorithms and machine learning, avoiding human biases. Second, with cash flow-based lending, the lack of conventional qualifications (which female entrepreneurs do not have) for a loan is no longer an issue. Moreover, the digital This aspect of it proves to be most beneficial for women, as they can avail of credit without having to physically leave their homes and see the process consume a significant amount of their time (for which they are already pressed). Taking advantage of this opportunity, lenders have now launched integrated services in which credit trips can start through platforms like WhatsApp. The process is just to answer a few questions via WhatsApp and send documents to avail the loans.

The path to follow

Addressing the digital divide must be a top priority to realize this potential at scale. In Indiawomen are 15% less likely to own a mobile phone and 33% less likely to use mobile internet.

For technological capabilities to drive full financial inclusion, much remains to be done. Currently, we see that technology can address three of the key touchpoints for growth. It has the potential to level the playing field for female entrepreneurs. Digital loans have been proven to enable scaling for women entrepreneurs running successful businesses. Because of this, it can widen the funnel for other women to engage in entrepreneurship and credit, without worrying about their access to capital.



The opinions expressed above are those of the author.


4 government agencies you may not know will help you pay off your student loan https://gosic.org/4-government-agencies-you-may-not-know-will-help-you-pay-off-your-student-loan/ Fri, 18 Nov 2022 15:07:00 +0000 https://gosic.org/4-government-agencies-you-may-not-know-will-help-you-pay-off-your-student-loan/

of President Joe Biden student loan cancellation plan seemed like a dream come true for millions of borrowers when it was unveiled in August. Now they face the nightmarish possibility that the money they were planning to save will have to be paid back after all.

Discover: 11 companies you may not know will help you pay off your student loan
Student Loan Forgiveness: What to do if you have already applied

A lawsuit filed by six Republican-leaning states challenging the legality of the debt relief program has led to a recent court order that temporarily blocked him. The US Department of Education has stopped accepting applications while legal battles unfold.

Now, there are growing concerns about whether the program will fulfill its mission of canceling up to $20,000 in student loan debt per borrower. James Kvaal, Undersecretary for Education, said in a recent court filing that if the Department of Education cannot provide debt relief, “there could be a historically large increase in the amount of federal student loans in arrears and defaults.”

Whatever happens, the United States will always be home to a huge amount of student loan debt. During the third quarter of 2022, student loan balances were $1.57 trillion, according to a Nov. 15 press release from the Federal Reserve Bank of New York.

If the Biden administration’s debt relief package ends up being permanently stalled, federal student loan borrowers will have to start repaying their loans in early 2023. That’s when the break current refund must end.

The amount of student loan debt in the United States — combined with the number of borrowers at risk of default — will likely reignite conversations about the role employers can play in helping their employees reduce their debt. That might be the best long-term solution, according to Kristen Carlisle, chief executive of improvement at worka provider of 401k benefits and financial wellness.

“Amid all this uncertainty, one thing is clear: Not all student debt will go away anytime soon and it’s time for employers to act,” Carlisle told GOBankingRates in an emailed statement. “The billions of dollars in student debt owed to the United States is a national crisis and an enormous burden on the millions of Americans who carry this debt…Employers must partner with employees to help find solutions .”

A number of leading companies have programs in place to help employees pay off student debt. Many government agencies do the same through loan repayment assistance programs, or LRAPs. These are provided to federal and state government employees and members of the U.S. Armed Forces as a recruitment and retention tool, according to the OPM.gov website.

Annual LRAP payments are capped at $10,000 and cumulative payments are capped at $60,000, although some federal agencies have lower limits, according to the Cappex website. Employees must agree to either continue working for the agency for at least three years or repay the full amount of the loan.

The Ask the Money Coach website lists more than 80 agencies that help with college loans through LRAP, ranging from large federal agencies such as the Departments of Agriculture, Commerce, Defense, Education, and of Energy to smaller independent agencies like the Federal Deposit Insurance Corporation, Federal Elections Commission, Federal Energy Regulatory Commission, Federal Housing Finance Agency, Small Business Administration, and Smithsonian Institution

Federal employees may also be eligible to have their loans forgiven under the Civil Service Loan Forgiveness Program. Under this program, you can get your entire remaining direct loan balance forgiven after making 120 qualifying payments or 10 years’ worth.

To learn more about getting student loan help as a government employee, visit Office of Personnel Management (OPM) website.

Take our poll : Do you think student loan debt should be forgiven?

Here is an example of how four federal agencies provide student loan repayment benefits:

  • Department of Justice PARL: Eligible attorneys can get $6,000 a year in repayment assistance with a lifetime maximum of $60,000, according to Best Colleges. Participating attorneys must sign an agreement with the DOJ and commit to an initial three-year service obligation.
  • Indian Health Service Loan Repayment: Eligible health practitioners can receive up to $20,000 per year in student loan repayment assistance in exchange for a two-year service commitment to practice full-time at a designated Indian Health Program site.
  • National Health Service Corps (NHSC) Rural Community Loan Repayment Scheme: Physicians, nurse practitioners, pharmacists and other healthcare professionals can earn up to $100,000 in student loan repayment assistance in exchange for a three-year service commitment at an NHSC-approved site.
  • State Department: According to the State.gov website, its Student Loan Repayment Program (SLRP) allows employees to reduce student loan debt incurred to support educational programs the employee has already completed or, in the case of Parent Loans. Plus, followed by the employee’s child. Payments are made directly to the lender or the employee’s loan servicer.

More from GOBankingRates

This article originally appeared on GOBankingRates.com: 4 government agencies you may not know will help you pay off your student loan

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

CU Direct Announces Name Change to Origence | New https://gosic.org/cu-direct-announces-name-change-to-origence-new/ Tue, 15 Nov 2022 17:32:20 +0000 https://gosic.org/cu-direct-announces-name-change-to-origence-new/

Irvine, Calif., Nov. 15, 2022 (GLOBE NEWSWIRE) — CU Direct, a leader in financial technology solutions for credit unions, announced that it will rebrand the company as Origin. The change reflects the company’s vision to create the ultimate origination experience and help credit unions win in a digital world.

“Three years ago, CU Direct launched the Origence brand to provide our credit union partners with next-generation financial technology,” said Tony Boutelle, President and CEO of Origence. “The name Origence is significant because it was created by combining the words ‘origin’ + ‘experience’. Origence clearly articulates our vision and the importance that the origination experience plays in the success of our credit unions, particularly in meeting the ever-changing needs of modern borrowers.

The company’s indirect lending solution, CUDL, will remain a sub-brand of Origence, continuing its mission to connect car dealerships to credit union financing. Credit unions using the CUDL network continue to be the largest auto lender in the nation as a whole, helping dealerships sell 1.5 million vehicles with credit union financing (January 1 – September 30, 2022).

All other products, including new Original bow rig composed of arc DX (digital experience portal), arc OS (formerly Lending 360 LOS) and arc MX (formerly Intuvo marketing automation), will unify under the Origence brand. Over the next several months, the company will transition key business touchpoints to reflect Origence’s new name and visual branding. This will include rebranding the company’s web properties, social media channels and digital communications.

CU Direct will remain the CUSO holding company for shareholder and board purposes.

“Through Origence and our many products and services, we have transformed the origination journey for credit unions and their members,” Boutelle said. “Now we will build on this momentum under a strong, industry-recognized brand that reflects our vision to create the ultimate origination experience.”

About Origin

Origence is a credit union service organization (CUSO) that provides financial technology that enhances the origination experience to increase loan volume, create efficiencies, and grow accounts. With Origence, financial institutions can offer consumer and indirect lending with increased levels of productivity and scale while providing a convenient and personalized borrower experience. Solutions also include marketing automation, automatic purchases, loan operations, and more. Origence is headquartered in Irvine, California. For more information, visit www.origence.com and follow us on Twitter and LinkedIn.

# # #

James Flores Origin james.flores@origence.com

Copyright 2022 GlobeNewswire, Inc.

Is a payday advance from a bank better than a personal loan? https://gosic.org/is-a-payday-advance-from-a-bank-better-than-a-personal-loan/ Sat, 12 Nov 2022 12:32:34 +0000 https://gosic.org/is-a-payday-advance-from-a-bank-better-than-a-personal-loan/

Image source: Getty Images

We’ve all come across an unexpected expense from time to time.

Key points

  • 60% of Americans couldn’t cover a $400 emergency expense without going into debt.
  • If you need cash fast and your bank offers payday advances, it might be worth looking into.
  • A personal loan has other advantages, however, such as a higher borrowing limit and a lower interest rate.

Many of us have been there. You had a car accident, and now you have to pay the mechanic to fix it. This unexpected expense will cost you a few hundred dollars, and like 60% of Americans, you are not able to cover it with your savings. Moreover, you only have money left for the bare necessities in your current account, and your next payday is several days away. What should you do?

You have a few options in this situation. Read on to learn more about bank payday advances versus personal loans, and how to decide which is right for you.

What is a salary advance?

A payday advance loan from a bank or box is called a small loan. These are loans generally between $100 and $1,000 granted by a bank to account holders. The intention is to give consumers an alternative to predatory payday loans (see below) when they are in a financial bind. If your bank offers them, you’ll get the money you need quickly and pay it back from your next paycheck via direct deposit, or over a period of weeks or months. You will have to pay a fee (either a fixed dollar amount or a small percentage of what you borrow) and interest for the service.

You may soon hear more about payday advances; a Bloomberg Law report in early October 2022 noted that federal regulators want banks to be able to offer them, but banks need more guidance from regulatory agencies moving forward. Personal loans, on the other hand, are already reliably available for your emergency borrowing needs.

What is a personal loan?

A Personal loan is a fairly easy way to borrow a lump sum of money. They usually come with lower interest rates than many other quick cash solutions, like credit cards or payday loans (and certainly lower than payday loans). However, if your credit is not in top shape, you may not be eligible for the best personal loan rates available.

Personal loans are generally in the amount of $1,000 to $100,000, and can often be funded fairly quickly after your application is approved. In some cases you can get the money the same day or the next day. Is there another way to borrow money fast? Yes, but you probably want to stay away.

Try to avoid payday loans

Although it may seem counterintuitive (after all, there’s “payday” in the name), it’s a good idea to avoid payday loans. And depending on where you live, they may be illegal in your area; they have been banned in 13 states and the District of Columbia. Payday loans are small, short-term loans of $500 or less, usually with a very high interest rate.

As of 2022, typical payday loan rates range from 28% to 1,950%. These loans often trick consumers in a cycle of debt from which they cannot easily escape. Can’t repay your loan on your next payday? That’s fine, the lender will turn it into a new payday loan for you! How nice of them. Your best choice is probably a payday loan or a personal loan.

How do you choose?

There are a few things to consider when choosing between a payday advance and a personal loan.

How much money do you need?

A payday advance loan, if you can get one from your bank or credit union, is probably best for borrowing smaller amounts. If your auto repair bill is $350, but the smallest personal loan amount you can take out is $1,000, that’s not ideal. If your surprise expense is larger, you’ll likely get a better interest rate with a personal loan (plus payday advances from your bank may be capped at $500).

How fast do you need it?

If you can wait a few days and have good credit, you may be better off with a personal loan – again, because of interest rates. That said, if your bank offers payday advance loans, they might approve you fairly quickly if you’re an existing customer in good standing. It has already registered you and can access your finances in the form of your bank account(s). Plus, your bank can easily send the money you borrow directly to your account.

How long do you need to pay it back?

This is where a personal loan probably has the advantage. You will have more time to repay a personal loan (months to years) than a payday loan (weeks to months). But again, a lot depends on the amount of money you need to borrow.

Payday advance loans and personal loans have their place, and if you ever get into trouble and need to borrow a relatively small amount of money, both are worth considering. However, it is definitely in your best interest to avoid payday loans.

The Ascent’s Best Personal Loans for 2022

Our team of independent experts have pored over the fine print to find the select personal loans that offer competitive rates and low fees. Start by reviewing The Ascent’s best personal loans for 2022.

INVESTORS TITLE CO – 10-Q – Management’s Discussion and Analysis of Financial Condition and Results of Operations – InsuranceNewsNet https://gosic.org/investors-title-co-10-q-managements-discussion-and-analysis-of-financial-condition-and-results-of-operations-insurancenewsnet/ Tue, 08 Nov 2022 22:29:52 +0000 https://gosic.org/investors-title-co-10-q-managements-discussion-and-analysis-of-financial-condition-and-results-of-operations-insurancenewsnet/
Investors Title Company's (the "Company") Annual Report on Form 10-K for the
year ended December 31, 2021 (the "2021 Form 10-K") as filed with the Securities
and Exchange Commission (the "SEC") should be read in conjunction with the
following discussion since it contains information which is important for
evaluating the Company's operating results and financial condition.

In addition, the Company may make forward-looking statements in the following
discussion and analysis. Forward looking statements are based on certain
assumptions and expectations of future events that are subject to a number of
risks and uncertainties. Actual results may vary. See "Safe Harbor for
Forward-Looking Statements" at the end of this discussion and analysis, as well
as the sections titled "Risk Factors" in Part I, Item 1A of the 2021 Form 10-K
for factors that could affect forward-looking statements.


The Company is a holding company that engages primarily in issuing title
insurance through two subsidiaries, Investors Title Insurance Company ("ITIC")
and National Investors Title Insurance Company ("NITIC"). Through ITIC and
NITIC, the Company underwrites land title insurance for owners and mortgagees as
a primary insurer. Total revenues from the title segment accounted for 96.1% of
the Company's revenues for the nine-month period ended September 30, 2022.

Title insurance protects against loss or damage resulting from title defects
that affect real property. When real property is conveyed from one party to
another, occasionally there is an undisclosed defect in the title or a mistake
or omission in a prior deed, will or mortgage that may give a third party a
legal claim against such property. If a covered claim is made against real
property, title insurance provides indemnification against insured defects.

There are two basic types of title insurance policies - one for the mortgage
lender and one for the real property owner. A lender often requires the property
owner to purchase a lender's title insurance policy to protect its position as a
holder of a mortgage loan, but the lender's title insurance policy does not
protect the property owner. The property owner has to purchase a separate
owner's title insurance policy to protect its investment.

The Company issues title insurance policies directly and through a network of
agents. Issuing agents are typically real estate attorneys, independent agents
or subsidiaries of community and regional mortgage lending institutions,
depending on local customs and regulations and the Company's marketing strategy
in a particular territory. The ability to attract and retain issuing agents is a
key determinant of the Company's growth in title insurance premiums written.

Revenues from the title insurance segment come mainly from the purchase of new
and existing residential and commercial real estate, refinancing activity and
certain other types of mortgages such as home equity lines of credit.

Title insurance premiums vary from state to state and are subject to extensive
regulation. Statutes generally provide that rates must not be excessive,
inadequate or unfairly discriminatory. The process of implementing a rate change
in most states involves pre-approval by the applicable state insurance

Volume is a factor in the Company's profitability due to fixed operating costs
that are incurred by the Company regardless of title insurance premium
volume. The resulting operating leverage tends to amplify the impact of changes
in volume on the Company's profitability. The Company's profitability also
depends, in part, upon its ability to manage its investment portfolio to
maximize investment returns and to minimize risks such as interest rate changes,
defaults and impairments of assets.

The Company's volume of title insurance premiums is affected by the overall
level of residential and commercial real estate activity, which includes
property sales, mortgage financing and mortgage refinancing. Real estate
activity, home sales and mortgage lending are cyclical in nature. Real estate
activity is affected by a number of factors, including the availability of
mortgage credit, the cost of real estate, consumer confidence, employment and
family income levels, and general United States economic conditions. Interest
rate volatility is also an important factor in the level of residential and
commercial real estate activity.

Company title insurance premiums in future periods may fluctuate
due to these and other factors beyond management’s control.

Historically, the title insurance business tends to be seasonal as well as
cyclical. Because home sales are typically strongest in periods of favorable
weather, the first calendar quarter tends to have the lowest activity levels,
while the spring and summer quarters tend to be more active. Mortgage refinance
activity tends to be influenced less by seasonality and more by economic cycles,
with activity levels increasing during times of falling interest rates.


Services other than title insurance provided by the operating divisions of the
Companies are not reported separately, but rather are reported collectively in a
group called “Everyone else”. These other services include those offered by the
Company and its wholly-owned subsidiaries, Exchange of securities of investors
(“ITEC”), Investors Title Accommodation Corporation (“ITAC”),
Investors Trust Company (“Investor confidence“) and Investor securities management
Services, Inc.

The Company's exchange services division, consisting of the operations of ITEC
and ITAC, provides customer services in connection with tax-deferred real
property exchanges. ITEC acts as a qualified intermediary in tax-deferred
exchanges of property held for productive use in a trade or business or for
investment, and its income is derived from fees for handling exchange
transactions and interest earned on client deposits held by the Company. In its
role as qualified intermediary, ITEC coordinates the exchange aspects of the
real estate transaction, and its duties include drafting standard exchange
documents, holding the exchange funds between the time the old property is sold
and the new property is purchased, and accepting the formal identification of
the replacement property within the required identification period. ITAC
provides services as an exchange accommodation titleholder for accomplishing
"parking transactions" as set forth in the safe harbor contained in Internal
Revenue Procedure 2000-37.  These transactions include reverse exchanges when
taxpayers decide to acquire replacement property before selling the relinquished
property, or "build to suit" exchanges, when improvements must be made to the
replacement property before the taxpayer acquires the improved replacement
property. The services provided by the Company's exchange services division,
ITEC and ITAC, are pursuant to provisions in the Internal Revenue Code. From
time to time, these laws are subject to review and changes, which may negatively
affect the demand for tax-deferred exchanges in general, and consequently, the
revenues and profitability of the Company's exchange services division.

The Trust Services Division of the Company, Investor confidenceprovides investments
management and trust services to individuals, businesses, banks and trusts.

ITMS offers various consulting and management services to provide customers
the technical expertise to successfully start and operate title insurance

Recent Trade Trends and Conditions

The housing market is heavily influenced by government policies and overall
economic conditions. Regulatory reform and initiatives by various governmental
agencies, including the Federal Reserve's monetary policy and other regulatory
changes, could impact lending standards or the processes and procedures used by
the Company. The current real estate environment, including interest rates and
general economic activity, typically influence the demand for real estate.
Changes in either of these areas, in addition to ongoing supply constraints and
volatility in the cost and availability of building materials, could impact the
Company's results of operations in future periods.

COVID-19 - COVID-19 could continue to affect the Company in a number of ways
including, but not limited to, the impact of employees becoming ill,
quarantined, or otherwise unable to work or travel due to illness or
governmental restriction, potential decreases in net premiums written in the
future, and future fluctuations in the Company's investment portfolio.

The current period of inflation, as well as ongoing military conflict between
Russia and Ukraine, has created additional volatile market conditions and
uncertainties in the global economy. These events have impacted and could
continue to impact the Company in a number of ways including, but not limited
to, future fluctuations in the Company's investment portfolio and potential
decreases in net premiums written. The Federal Open Market Committee ("FOMC") of
the Federal Reserve has been highly attentive to the risks that these events
have created, and in response has been raising the target federal funds rate at
recent meetings. Although the federal funds rate does not directly impact
mortgage interest rates, it can have a significant influence as lenders pass on
the costs of rate increases to consumers. Higher mortgage interest rates could
impact the demand and pricing of real estate.

Regulatory environment

The FOMC issues disclosures on a periodic basis that include projections of the
federal funds rate and expected actions. In March 2020, the FOMC lowered the
target federal funds rate twice by a total of 150 basis points in response to
risk posed to economic activity by COVID-19, resulting in a target federal funds
rate range between 0.00% and 0.25%. The FOMC had maintained this target range
until March 2022, when the target federal funds rate range was increased to
between 0.25% and 0.50%. The target federal funds rate range was further raised
at subsequent meetings, with the FOMC's most recent change increasing the target
range in November 2022 to between 3.75% and 4.00%. The FOMC has noted that it
anticipates that ongoing increases in the target range will be appropriate and,
in addition, has decided to continue with balance sheet holdings reductions that
began in May of 2022. In normal economic situations, future adjustments to the
FOMC's stance of monetary policy are expected to be based on realized and
expected economic developments to achieve maximum employment and inflation near
the FOMC's symmetric long-term 2.0% objective.


In 2008, the federal government took control of the Federal National Mortgage
Association ("Fannie Mae") and the Federal Home Loan Mortgage Corporation
("Freddie Mac") in an effort to keep these government-sponsored entities from
failing. The primary functions of Fannie Mae and Freddie Mac are to provide
liquidity to the nation's mortgage finance system by purchasing mortgages on the
secondary market, pooling them and selling them as mortgage-backed securities.
In order to securitize, Fannie Mae and Freddie Mac typically require the
purchase of title insurance for loans they acquire. Since the federal takeover,
there have been various discussions and proposals regarding their reform.
Changes to these entities could impact the entire mortgage loan process and, as
a result, could affect the demand for title insurance. The timing and results of
reform are currently unknown; however, any changes to these entities could
affect the Company and its results of operations.

In recent years, the Consumer Financial Protection Bureau ("CFPB"), Office of
the Comptroller of Currency and the Federal Reserve have issued memorandums to
banks that communicated those agencies' heightened focus on vetting third-party
providers. Such increased regulatory involvement may affect the Company's agents
and approved providers. Further proposals to change regulations governing
insurance holding companies and the title insurance industry are often
introduced in Congress, in state legislatures and before various insurance
regulatory agencies. Although the Company regularly monitors such proposals, the
likelihood and timing of passage of any such regulation, and the possible
effects of any such regulation on the Company and its subsidiaries, cannot be
determined at this time.

The timing and nature of any reforms are currently unknown; however, the CFPB
has taken a significantly more aggressive approach to using its rulemaking,
supervision, and enforcement authorities under President Biden's administration.
Any changes to the CFPB or other governmental entities could affect the Company
and its results of operations.

Real estate environment

The Mortgage Bankers Association's ("MBA") September 19, 2022 Mortgage Finance
Forecast ("MBA Forecast") projects 2022 purchase activity to decrease 13.2% to
$1,618 billion and mortgage refinance activity to decrease 72.6% to $706
billion, resulting in a net decrease in total mortgage originations of 47.6% to
$2,324 billion, all from 2021 levels. In 2021, purchase activity accounted for
42.0% of all mortgage originations and is projected in the MBA Forecast to
represent 69.6% of all mortgage originations in 2022. According to data
published by Freddie Mac, the average 30-year fixed mortgage interest rates in
the United States were 4.9% and 2.9% for the nine-month periods ended
September 30, 2022 and 2021, respectively. The FOMC has noted that it
anticipates that ongoing increases in the federal funds rate will be appropriate
in response to the current inflationary environment, with mortgage rates
typically moving in conjunction with the federal funds rate. Per the MBA
Forecast, mortgage interest rates are projected to stay at or around 5.5% for
the remainder of 2022, before decreasing in both 2023 and 2024. Due to the
rapidly changing environment brought on by COVID-19, supply constraints,
inflationary pressures and geopolitical conflicts, these projections and the
impact of actual future developments on the Company could be subject to material

Historically, activity in real estate markets has varied over the course of
market cycles by geographic region and in response to evolving economic factors.
Operating results can vary from year to year based on cyclical market conditions
and do not necessarily indicate the Company's future operating results and cash

Critical accounting estimates and policies

The preparation of the Company's unaudited Consolidated Financial Statements
requires management to make estimates and judgments that affect the reported
amounts of certain assets, liabilities, revenues, expenses and related
disclosures regarding contingencies and commitments. Actual results could differ
from these estimates. During the nine-month period ended September 30, 2022, the
Company did not make any material changes to its critical accounting policies as
previously disclosed in Management's Discussion and Analysis in the 2021 Form


Operating results

The following table presents certain unaudited Consolidated Statements of
Operations data for the three- and nine-month periods ended September 30, 2022
and 2021:

                                                             Three Months Ended                     Nine Months Ended
                                                                September 30,                         September 30,
(in thousands)                                             2022               2021               2022               2021
Net premiums written                                   $   66,658          $ 72,345          $ 199,409          $ 201,349
Escrow and other title-related fees                         5,963             3,863             17,236             10,148
Non-title services                                          3,852             2,446              9,114              6,932
Interest and dividends                                      1,229               893              3,055              2,807
Other investment income                                     2,173             2,186              4,616              4,610
Net realized investment gains                               2,481               268              6,266                771
Changes in the estimated fair value of equity security
investments                                                (4,635)             (802)           (22,722)             7,266
Other                                                         277               217                924              4,572
Total Revenues                                             77,998            81,416            217,898            238,455

Operating Expenses:
Commissions to agents                                      33,478            37,570             97,161            102,458
Provision for claims                                        1,966             1,993              3,452              5,020
Personnel expenses                                         21,586            15,457             63,738             47,524
Office and technology expenses                              4,274             3,175             12,930              9,128
Other expenses                                              6,606             4,784             19,783             13,285
Total Operating Expenses                                   67,910            62,979            197,064            177,415

Income before Income Taxes                                 10,088            18,437             20,834             61,040

Provision for Income Taxes                                  2,175             3,934              4,457             12,932

Net Income                                             $    7,913          $ 14,503          $  16,377          $  48,108


Insurance income

Insurance revenues include net premiums written and escrow and other
title-related income that includes escrow fees, commissions and settlement fees.
Non-title services revenue, investment-related revenues and other revenues are
discussed separately below.

Net Premiums Written

Net premiums written decreased 7.9% and 1.0% for the three- and nine-month
periods ended September 30, 2022 to $66.7 million and $199.4 million,
respectively, compared with $72.3 million and $201.3 million for the same prior
year periods. The decreases for the three- and nine-month periods ended
September 30, 2022 were primarily driven by an overall decline in the level of
real estate transaction volume following the rise in mortgage interest rates,
partially offset by higher average home prices and increased premiums in our
Texas market.

Total premiums include an estimate of premiums for policies that have been
issued directly and by agents, but not reported to the Company as of the balance
sheet date. To determine the estimated premiums, the Company uses historical
experience, as well as other factors, to make certain assumptions about the
average elapsed time between the policy effective date and the date the policies
are reported. From time to time, the Company adjusts the inputs to the
estimation process as reported transactions and new information becomes
available from direct and agency business. In addition to estimating revenues,
the Company also estimates and accrues agent commissions, claims provision,
premium taxes, income taxes, and other expenses associated with the estimated
revenues that have been accrued. The Company reflects any adjustments to the
accruals in the results of operations in the period in which new information
becomes available.

Title insurance companies typically issue title insurance policies directly or
through title agencies. Following is a breakdown of premiums generated by direct
and agency operations for the three- and nine-month periods ended September 30,
2022 and 2021, with certain balances for 2021 reclassified to conform to the
2022 presentation:

                                                            Three Months Ended                                                             Nine Months Ended
                                                               September 30,                                                                 September 30,
(in thousands, except
percentages)                          2022                  %                2021                 %                 2022                 %                 2021                 %
Direct                            $   21,818                32.7          $ 21,803                30.1          $  68,478                34.3          $  61,619                30.6
Agency                                44,840                67.3            50,542                69.9            130,931                65.7            139,730                69.4
Total                             $   66,658               100.0          $ 72,345               100.0          $ 199,409               100.0          $ 201,349               100.0

Direct Net Premiums - The Company's direct business consists of operations at
the home office, branch offices, and wholly owned title insurance agencies. In
the Company's direct operations, the Company issues a title insurance policy and
retains the entire premium, as no commissions are recognized in connection with
these policies. Net premiums written from direct operations increased 0.1% and
11.1% for the three- and nine-month periods ended September 30, 2022,
respectively, compared with the same prior year periods. The increases for the
three- and nine-month periods ended September 30, 2022 and 2021 were driven by
higher average home prices and increased premiums written by wholly owned
agencies in our Texas market, partially offset by a decline in transaction
volume associated with higher mortgage interest rates.

Agency Net Premiums - When a policy is written through a non-wholly owned title
agency, the premium is shared between the agency and the underwriter. The agent
retains a majority of the premium as a commission and remits the net amount to
the Company. Title insurance commissions earned by the Company's agents are
recognized as expenses concurrently with premium recognition. Agency net
premiums written decreased 11.3% and 6.3% for the three- and nine-month periods
ended September 30, 2022, compared with the same prior year periods. The
decreases for the three- and nine-month periods ended September 30, 2022 were
primarily driven by an overall decline in the level of real estate transaction
volume following the rise in mortgage interest rates, partially offset by higher
average home prices.

Following is a schedule of net premiums written for the three- and nine-month
periods ended September 30, 2022 and 2021 in select states in which the
Company's two insurance subsidiaries, ITIC and NITIC, currently underwrite title

                              Three Months Ended         Nine Months Ended
                                September 30,              September 30,
State (in thousands)          2022           2021       2022           2021
North Carolina            $   23,622      $ 26,118   $  71,392      $  75,527
Texas                         21,081        18,079      60,457         42,317
Georgia                        6,094         7,667      18,819         25,527
South Carolina                 6,407         7,258      17,349         17,940
All Others                     9,632        13,352      32,068         40,413
Premiums Written              66,836        72,474     200,085        201,724
Reinsurance Assumed                -             -           -              -
Reinsurance Ceded               (178)         (129)       (676)          (375)
Net Premiums Written      $   66,658      $ 72,345   $ 199,409      $ 201,349

The increases in net premiums written in the state of Texas for the three- and
nine-month periods ended September 30, 2022 primarily resulted from the
Company's recent acquisitions of title insurance agencies doing business in the
state of Texas. The Company evaluates nonorganic growth opportunities, such as
acquisitions of title insurance agencies, from time to time in the ordinary
course of business.

Escrow and other title fees

Escrow and other title-related fees consists primarily of commission income,
escrow and other various fees associated with the issuance of title insurance
policies including settlement, examination and closing fees. Escrow and other
title-related fee revenues were $6.0 million and $17.2 million for the three-
and nine-month periods ended September 30, 2022, respectively, compared with
$3.9 million and $10.1 million for the same prior year periods. The increases
for the three- and nine-month periods ended September 30, 2022 were mainly due
to a larger share of business in markets that generate escrow income, and fee
income associated with commercial activity.

Revenue from non-securities services

Revenue from non-title services includes trust services, agency management
services and exchange services income. Non-title service revenues were $3.9
million and $9.1 million for the three- and nine-month periods ended
September 30, 2022, respectively, compared with $2.4 million and $6.9 million
for the same prior year periods. The increases for the three- and nine-month
periods ended September 30, 2022 were primarily related to increases in
like-kind exchange revenues.

Investment-related income

Investment-related revenues include interest and dividends, other investment
income, net realized investment gains and changes in the estimated fair value of
equity security investments.

Interest and Dividends

The Company derives a substantial portion of its income from investments in
fixed maturity securities, which are primarily municipal and corporate fixed
maturity securities, and equity securities. The Company's investment policy is
designed to comply with regulatory requirements and to balance the competing
objectives of asset quality and investment returns. The Company's title
insurance subsidiaries are required by statute to maintain minimum levels of
investments in order to protect the interests of policyholders.

The Company's investment strategy emphasizes after-tax income and principal
preservation. The Company's investments are primarily in fixed maturity
securities and equity securities. The average effective maturity of the majority
of the fixed maturity securities is less than 10 years. The Company's invested
assets are managed to fund its obligations and evaluated to ensure long term
stability of capital accounts.


As the Company generates cash from operations, it is invested in accordance with
the Company's investment policy and corporate goals. The Company's investment
policy has been designed to balance multiple goals, including the assurance of a
stable source of income from interest and dividends, the preservation of
principal, and the provision of liquidity sufficient to meet insurance
underwriting and other obligations as they become payable in the
future. Securities purchased may include a combination of taxable or tax-exempt
fixed maturity securities and equity securities. The Company also invests in
short-term investments that typically include money market funds, and, at times,
the Company has or could invest in U.S. Treasury bills, commercial paper and
certificates of deposit. The Company strives to maintain a high quality
investment portfolio. In 2022, the Company has purchased higher levels of
short-term investments due to the downturns in other investment vehicles
utilized by the Company and uncertainty in the investment market.

Interest and dividends were $1.2 million and $3.1 million for the three- and
nine-month periods ended September 30, 2022, respectively, compared with $893
thousand and $2.8 million for the same prior year periods. Interest and
investment income levels are primarily a function of general market performance,
interest rates and the amount of cash available for investments that meet the
Company's investment policy.

Other investment income

Other investment income consists primarily of income related to investments in
unconsolidated affiliates, typically structured as limited liability companies
("LLCs"), accounted for under either the equity method of accounting or the
measurement alternative for investments that do not have readily determinable
fair values. The measurement alternative method requires investments without
readily determinable fair values to be recorded at cost, less impairments, and
plus or minus any changes resulting from observable price changes. The Company
monitors any events or changes in circumstances that may have had a significant
adverse effect on the fair value of these investments and makes any necessary

Other investment income was $2.2 million and $4.6 million for the three- and
nine-month periods ended September 30, 2022, respectively, compared with $2.2
million and $4.6 million for the same prior year periods. Changes in other
investment income are impacted by fluctuations in the carrying value of the
underlying investment and/or distributions received.

Net realized investment gains

Dispositions of equity securities at a realized gain or loss reflect such
factors as industry sector allocation decisions, ongoing assessments of issuers'
business prospects and tax planning considerations. Additionally, the amounts
included in net realized investment gains are affected by assessments of
securities' valuation for impairment. As a result of the interaction of these
factors and considerations, the net realized investment gain or loss can vary
significantly from period to period.

The net realized investment gains were $2.5 million and $6.3 million for the
three- and nine-month periods ended September 30, 2022, respectively, compared
with $268 thousand and $771 thousand for the same prior year periods. The
Company recorded impairment charges of $35 thousand and $162 thousand on certain
fixed maturity securities where the intent to hold has changed in the three- and
nine-month periods ended September 30, 2022. There were no impairment charges
recorded in 2021. Management believes unrealized losses on the remaining fixed
maturity securities at September 30, 2022 are temporary in nature.

The securities in the Company's investment portfolio are subject to economic
conditions and market risks. The Company considers relevant facts and
circumstances in evaluating whether a credit or interest-related impairment of a
fixed maturity security has occurred. Relevant facts and circumstances include
the extent and length of time the fair value of an investment has been below

There are a number of risks and uncertainties inherent in the process of
monitoring impairments and determining if an impairment is other-than-temporary.
These risks and uncertainties include the risk that the economic outlook will be
worse than expected or have more of an impact on the issuer than anticipated;
the risk that the Company's assessment of an issuer's ability to meet all of its
contractual obligations will change based on changes in the characteristics of
that issuer; the risk that information obtained by the Company or changes in
other facts and circumstances leads management to change its intent to sell the
fixed maturity security; and the risk that management is making decisions based
on inaccurate information.

Changes in estimated fair value of equity investments

Changes in the estimated fair value of equity security investments were $(4.6)
million and $(22.7) million for the three- and nine-month periods ended
September 30, 2022, respectively, compared with $(802) thousand and $7.3 million
for the same prior year periods. Such fluctuations are the result of changes in
general market conditions during the respective periods. All major indices have
experienced significant declines in 2022.


Other income

Other revenues primarily include miscellaneous income and gains and losses on
the disposal of fixed assets and real estate. Other revenues were $277 thousand
and $924 thousand for the three- and nine-month periods ended September 30,
2022, respectively, compared with $217 thousand and $4.6 million for the same
prior year periods. The decrease for the nine-month period ended September 30,
2022 was primarily related to a gain on the sale of a property recorded in 2021.


The Company's operating expenses consist primarily of commissions to agents,
personnel expenses, office and technology expenses and the provision for claims.
Operating expenses increased 7.8% and 11.1% for the three- and nine-month
periods ended September 30, 2022, compared with the same prior year periods. The
increases for the three- and nine-month periods ended September 30, 2022 were
primarily due to increases in personnel expenses, title fees, and office and
technology expenses.

Following is a summary of the Company's operating expenses for the three- and
nine-month periods ended September 30, 2022 and 2021. Inter-segment eliminations
have been netted; therefore, the individual segment amounts will not agree to
Note 4 to the unaudited Consolidated Financial Statements in this Quarterly
Report on Form 10-Q.

                                                            Three Months Ended                                                       Nine Months Ended
                                                               September 30,                                                           September 30,
(in thousands, except
percentages)                          2022                  %                2021                 %           2022                 %                 2021                 %
Title Insurance                   $   65,567                96.5          $ 60,599                96.2    $ 188,788                95.8          $ 170,032                95.8
All Other                              2,343                 3.5             2,380                 3.8        8,276                 4.2              7,383                 4.2
Total                             $   67,910               100.0          $ 62,979               100.0    $ 197,064               100.0          $ 177,415               100.0

On a combined basis, the after-tax profit margins were 10.1% and 7.5% for the
three- and nine-month periods ended September 30, 2022, respectively, compared
with 17.8% and 20.2% for the same prior year periods. The decreases for the
three- and nine-month periods ended September 30, 2022 were primarily due to
reductions in the estimated fair value of equity security investments during the
current year periods, a gain on the sale of property in the same prior year
periods, and increases in total expenses that outpaced the changes in revenue.
The Company continually strives to enhance its competitive strengths and market
position, including ongoing initiatives to manage its operating expenses.

Total enterprise

Personnel Expenses - Personnel expenses include base salaries, benefits and
payroll taxes, bonuses paid to employees and contract labor expenses. Personnel
expenses were $21.6 million and $63.7 million for the three- and nine-month
periods ended September 30, 2022, respectively, compared with $15.5 million and
$47.5 million for the same prior year periods. On a consolidated basis,
personnel expenses as a percentage of total revenues were 27.7% and 29.3% for
the three- and nine-month periods ended September 30, 2022, respectively,
compared with 19.0% and 19.9% for the same prior year periods. The increases in
personnel expenses for the three- and nine-month periods ended September 30,
2022 were primarily due to staffing of new offices, hiring to support growth
initiatives, and increased employee benefit costs. Increases in staffing levels
are the result of both organic growth and recent acquisitions of title insurance
agencies, as the Company continues expansion of its geographic footprint.
Employee headcount increased by 40.2% as of September 30, 2022, when compared to
the same prior year period, primarily due to the Company's continued expansion
efforts in the Texas market.

Office and Technology Expenses - Office and technology expenses primarily
include facilities expenses, software and hardware expenses, depreciation
expense, telecommunications expenses, and business insurance. Office and
technology expenses were $4.3 million and $12.9 million for the three- and
nine-month periods ended September 30, 2022, respectively, compared with $3.2
million and $9.1 million for the same prior year periods. The increases for the
three- and nine-month periods ended September 30, 2022 were primarily in support
of expanding the Company's geographic footprint, the result of adding new office
locations due to both organic growth and recent acquisitions of title insurance
agencies, and various ongoing technology initiatives.

Other Expenses - Other expenses primarily include business development expenses,
premium-related taxes and licensing, professional services, title and service
fees, amortization of intangible assets and other general expenses. Other
expenses were $6.6 million and $19.8 million for the three- and nine-month
periods ended September 30, 2022, respectively, compared with $4.8 million and
$13.3 million for the same prior year periods. The increases for the three- and
nine-month periods ended September 30, 2022 were primarily related to increases
in title and service fees, technology fees and business development expenses.


Title insurance

Commissions to Agents - Agent commissions represent the portion of premiums
retained by agents pursuant to the terms of their respective agency contracts.
Commissions to agents decreased 10.9% and 5.2% for the three- and nine-month
periods ended September 30, 2022, respectively, compared with the same prior
year periods. Commission expense as a percentage of net premiums written by
agents was 74.7% and 74.2% for the three- and nine-month periods ended
September 30, 2022, compared with 74.3% and 73.3% for the same prior year
periods. The changes in commission expense, and commission expense as a
percentage of net premiums written, were primarily related to the decreases in
agent premium volume and changes in geographic mix. Commission rates vary by
market due to local practice, competition and state regulations.

Provision for Claims - The provision for claims decreased 1.4% and 31.2% for the
three- and nine-month periods ended September 30, 2022, respectively, compared
with the same prior year periods. The provision for claims as a percentage of
net premiums written was 2.9% and 1.7% for the three- and nine-month periods
ended September 30, 2022, compared with 2.8% and 2.5% for the same prior year
periods. The decrease in the provision for claims for the nine-month period
ended September 30, 2022 was primarily due to changes in the geographic mix for
underwriting risk and higher levels of favorable loss development in 2022.

Title claims are typically reported and paid within the first several years of
policy issuance. The provision for claims reflects actual payments of claims,
net of recovery amounts, plus adjustments to the specific and incurred but not
reported claims reserves, the latter of which are actuarially determined based
on historical claims experience. Actual payments of claims, net of recoveries,
were $2.6 million and $1.8 million for the nine-month periods ended
September 30, 2022 and 2021, respectively.

At September 30, 2022, the total reserve for claims was $37.6 million. Of that
total, approximately $4.0 million was reserved for specific claims, and
approximately $33.6 million was reserved for claims for which the Company had no
notice. Because of the uncertainty of future claims, changes in economic
conditions and the fact that claims may not materialize for several years,
reserve estimates are subject to variability.

Changes from prior periods in the expected liability for claims reflect the
uncertainty of the claims environment, as well as the limited predictive power
of historical data. The Company continually updates and refines its reserve
estimates as current experience develops and credible data emerges. Such data
includes payments on claims closed during the quarter, new details that emerge
on open cases that cause claims adjusters to increase or decrease the case
reserves, and the impact that these types of changes have on the Company's total
loss provision. Adjustments may be required as new information develops, which
often varies from past experience.

Income taxes

The provision for income taxes was $2.2 million and $4.5 million for the three-
and nine-month periods ended September 30, 2022, respectively, compared with
$3.9 million and $12.9 million for the same prior year periods. Income tax
expense, including federal and state taxes, as a percentage of income before
income taxes was 21.6% and 21.4% for the three- and nine-month periods ended
September 30, 2022, respectively, compared with 21.3% and 21.2% for the same
prior year periods. The effective income tax rates for both 2022 and 2021 differ
from the U.S. federal statutory income tax rate of 21% primarily due to the
effect of tax-exempt income and state taxes. Tax-exempt income lowers the
effective tax rate.

The Company believes it is more likely than not that the tax benefits associated
with recognized impairments and unrecognized losses recorded through
September 30, 2022 will be realized. However, this judgment could be impacted by
further market fluctuations.

Cash and capital resources

The Company's material cash requirements include general operating expenses,
contractual and other obligations for the future payment of title claims,
employment agreements, lease agreements, income taxes, capital expenditures,
dividends on its common stock and other contractual commitments for goods and
services needed for operations. All other arrangements entered into by the
Company are not reasonably likely to have a material effect on liquidity or the
availability of capital resources. Cash flows from operations have historically
been the primary source of financing for expanding operations, whether through
organic growth or outside investments. The Company believes its balances of
cash, short-term investments and other readily marketable securities, along with
cash flows generated by ongoing operations, will be sufficient to satisfy its
cash requirements over the next 12 months and thereafter, including the funding
of operating activities and commitments for investing and financing activities,
in addition to potential purchases under the Company's repurchase plan described
below. There are currently no known trends that the Company believes will
materially impact the Company's capital resources, nor is the Company
anticipating any material changes in the mix or relative cost of such resources
except as otherwise disclosed in the Business Trends and Recent Conditions
section of this Management's Discussion and Analysis.

The Company evaluates nonorganic growth opportunities, such as mergers and
acquisitions, from time to time in the ordinary course of business. Because of
the episodic nature of these events, related incremental liquidity and capital
resource needs can be difficult to predict.

The Company's operating results and cash flows are heavily dependent on the real
estate market. The Company's business has certain fixed costs; therefore,
changes in the real estate market are monitored closely, and operating expenses
such as staffing levels are managed and adjusted accordingly. The Company
believes that its significant working capital position and management of
operating expenses will aid its ability to manage cash resources through
fluctuations in the real estate market.

Cash Flows - Net cash flows provided by operating activities were $20.3 million
and $35.7 million for the nine-month periods ended September 30, 2022 and 2021,
respectively. Cash flows provided by operating activities differ from net income
due to adjustments for non-cash items, such as changes in the estimated fair
value of equity security investments, gains and losses on investments and
property, the timing of disbursements for taxes, claims and other accrued
liabilities, and collections or changes in receivables and other assets.

Cash flows from non-operating activities have historically consisted of
purchases and proceeds from investing activities, the issuance of dividends and
repurchases of common stock. Net cash was used in investing activities for the
nine-month period ended September 30, 2022, compared with net cash being
provided by investing activities in the prior year period, due primarily to an
increase in purchases of investments, net of proceeds from investment sales and
maturities, the purchase of a subsidiary during the current year period, and a
decrease in proceeds from the sale of property.

The Company maintains a high degree of liquidity within its investment portfolio
in the form of cash, short-term investments and other readily marketable
securities. As of September 30, 2022, the Company held cash and cash equivalents
of $41.4 million, short-term investments of $80.8 million, available-for-sale
fixed maturity securities of $55.3 million and equity securities of $52.7
million. The net effect of all activities on total cash and cash equivalents was
an increase of $4.2 million in 2022.

Capital Resources - The amount of capital resources the Company maintains is
influenced by state regulation, the need to maintain superior financial ratings
from third-party rating agencies and other marketing and operational

The Company's significant sources of funds are dividends and distributions from
its subsidiaries, primarily its two title insurance subsidiaries. Cash is
received from its subsidiaries in the form of dividends and as reimbursements
for operating and other administrative expenses that it incurs. The
reimbursements are executed within the guidelines of management agreements
between the Company and its subsidiaries.

The ability of the Company's title insurance subsidiaries to pay dividends to
the Company is subject to state regulation from their respective states of
domicile. Each state regulates the extent to which title underwriters can pay
dividends or make distributions and requires prior regulatory approval of the
payment of dividends and other intercompany transfers. The maximum dividend
permitted by law is not necessarily indicative of an insurer's actual ability to
pay dividends. Depending on regulatory conditions, the Company may in the future
need to retain cash in its title insurance subsidiaries in order to maintain
their statutory capital position. As of September 30, 2022, both ITIC and NITIC
met the minimum capital, surplus and reserve requirements for each state in
which they are licensed.


While state regulations and the need to cover risks may set a minimum level for
capital requirements, other factors necessitate maintaining capital resources in
excess of the required minimum amounts. For instance, the Company's capital
resources help it maintain high ratings from insurance company rating agencies.
Superior ratings strengthen the Company's ability to compete with larger, well
known title insurers with national footprints.

A strong financial position provides the necessary flexibility to fund potential
acquisition activity, to invest in the Company's core business, and to minimize
the financial impact of potential adverse developments. Adverse developments
that generally require additional capital include adverse financial results,
changes in statutory accounting requirements by regulators, reserve charges,
investment losses or costs incurred to adapt to a changing regulatory
environment, including costs related to CFPB regulation of the real estate

The Company bases its capitalization levels, in part, on net coverage retained.
Since the Company's geographical focus has been and continues to be concentrated
in states with average premium rates typically lower than the national average,
capitalization relative to premiums will usually appear higher than industry

Due to the Company's historical ability to consistently generate positive cash
flows from its consolidated operations and investment income, management
believes that funds generated from operations will enable the Company to
adequately meet its current operating needs for the foreseeable future. However,
with any continued impact of COVID-19, ongoing inflationary pressures and the
ongoing military conflict between Russia and Ukraine, there can be no assurance
that future experience will be similar to historical experience, since it is
influenced by such factors as the interest rate environment, real estate
activity, the Company's claims-paying ability and its financial strength
ratings. In addition to operational and investment considerations, taking
advantage of opportunistic external growth opportunities may necessitate
obtaining additional capital resources. The Company is carefully monitoring the
COVID-19 situation, inflation, the conflict in Ukraine, and other trends that
could potentially result in material adverse liquidity changes, and will
continually assess its capital allocation strategy, including decisions relating
to payment of dividends, repurchasing the Company's common stock and/or
conserving cash.

Purchase of Company Stock - On November 9, 2015, the Board of Directors of the
Company approved the purchase of an additional 163,335 shares pursuant to the
Company's repurchase plan, such that there was authority remaining under the
plan to purchase up to an aggregate of 500,000 shares of the Company's common
stock pursuant to the plan immediately after this approval. Unless terminated
earlier by resolution of the Board of Directors, the plan will expire when all
shares authorized for purchase under the plan have been purchased. Pursuant to
the Company's ongoing purchase program, the Company purchased 629 shares in the
nine-month periods ended September 30, 2022 and did not repurchase any shares in
the corresponding period in 2021. The Company anticipates increasing its
purchases under the repurchase plan during the remainder of 2022 and first half
of 2023, subject to such factors as the prevailing market price of the Company's
common stock, the Company's available cash and then existing alternative uses
for such cash.

Capital Expenditures - Capital expenditures were approximately $4.0 million for
the nine-month period ended September 30, 2022. In 2022, the Company has plans
for various capital improvement projects, including increased investment in a
number of technology and system development initiatives and hardware purchases
which are anticipated to be funded via cash flows from operations. All material
anticipated capital expenditures are subject to periodic review and revision and
may vary depending on a number of factors.

Contractual Obligations - As of September 30, 2022, the Company had a claims
reserve totaling $37.6 million. The amounts and timing of these obligations are
estimated and not set contractually. Events such as fraud, defalcation, and
multiple property title defects can substantially and unexpectedly cause
increases in both the amount and timing of estimated title insurance loss
payments and loss cost trends whereby increases or decreases in inflationary
factors (including the value of real estate) will influence the ultimate amount
of title insurance loss payments and could increase total obligations and
influence claim payout patterns. Due to the length of time over which claim
payments are made and regularly occurring changes in underlying economic and
market conditions, claim estimates are subject to variability and future
payments could increase or decrease from these estimated amounts in the future.

ITIC, a wholly owned subsidiary of the Company, has entered into employment
agreements with certain executive officers. The amounts accrued for these
agreements at September 30, 2022 and December 31, 2021, were $14.2 million and
$13.4 million, respectively, which includes postretirement compensation and
health benefits, and were calculated based on the terms of the contracts. These
executive contracts are accounted for on an individual contract basis. As
payments are based upon the occurrence of specific events, including death,
disability, retirement, termination without cause or upon a change in control,
payment periods are currently uncertain. Information regarding retirement
agreements and other postretirement benefit plans can be found in Note 5 to the
unaudited Consolidated Financial Statements in this Quarterly Report on Form


The Company enters into lease agreements that are primarily used for office
space. These leases are accounted for as operating leases. A portion of the
Company's current leases include an option to extend or cancel the lease term,
and the exercise of such an option is solely at the Company's discretion. The
total of undiscounted future minimum lease payments under operating leases that
have initial or remaining noncancelable lease terms in excess of one year after
2022 is $6.3 million, which includes lease payments related to options to extend
or cancel the lease term if the Company determined at the date of adoption that
the lease was expected to be renewed or extended. Information about leases can
be found in Note 12 to the unaudited Consolidated Financial Statements in this
Quarterly Report on Form 10-Q.

In the normal course of business, the Company enters into other contracts
commitments of goods and services necessary for operations. Such commitments are
should not have a material adverse effect on the liquidity of the Company.

Off-balance sheet arrangements

As a service to its customers, the Company, through ITIC, administers escrow and
trust deposits representing earnest money received under real estate contracts,
undisbursed amounts received for settlement of mortgage loans and indemnities
against specific title risks. These amounts are not considered assets of the
Company and, therefore, are excluded from the accompanying unaudited
Consolidated Balance Sheets. However, the Company remains contingently liable
for the disposition of these deposits.

In addition, in administering tax-deferred like-kind exchanges pursuant to §
1031 of the Internal Revenue Code, ITEC serves as a qualified intermediary for
exchanges, holding the net sales proceeds from relinquished property to be used
for purchase of replacement property. ITAC serves as exchange accommodation
titleholder and, through LLCs that are wholly owned subsidiaries of ITAC, holds
property for exchangers in reverse exchange transactions. Like-kind exchange
deposits and reverse exchange property held by the Company for the purpose of
completing such transactions totaled approximately $477.9 million and $763.9
million as of September 30, 2022 and December 31, 2021, respectively. These
exchange deposits are held at third-party financial institutions. Exchange
deposits are not considered assets of the Company and, therefore, are excluded
from the accompanying unaudited Consolidated Balance Sheets; however, the
Company remains contingently liable for the disposition of the transfers of
property, disbursements of proceeds and the return on the proceeds at the agreed
upon rate. Exchange services revenue includes earnings on these deposits;
therefore, investment income is shown as non-title services rather than
investment income. These like-kind exchange funds are primarily invested in
money market funds and other short-term investments.

Foreign assets under management of Investors Trust Company are not considered
assets of the Company and, therefore, are excluded from
unaudited consolidated balance sheets.

It is not the general practice of the Company to enter into off-balance sheet
arrangements or issue guarantees to third parties. The Company does not have any
material source of liquidity or financing that involves off-balance sheet
arrangements. Other than items noted above, off-balance sheet arrangements are
generally limited to the future payments due under various agreements with
third-party service providers.

Recent accounting standards

No recent accounting pronouncements are expected to have a material impact on
the Company's financial position and results of operations. Please refer to Note
1 to the unaudited Consolidated Financial Statements included in this Quarterly
Report on Form 10-Q for further information regarding the Company's basis of
presentation and significant accounting policies.


Safe Harbor for forward-looking statements

This Quarterly Report on Form 10-Q, as well as information included in future
filings by the Company with the SEC and information contained in written
material, press releases and oral statements issued by or on behalf of the
Company, contains, or may contain, "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934 (the "Exchange Act"), that reflect management's
current outlook for future periods. These statements may be identified by the
use of words such as "plan," "expect," "aim," "believe," "project,"
"anticipate," "intend," "estimate," "should," "could," "would" and other
expressions that indicate future events and trends. All statements that address
expectations or projections about the future, including statements about the
Company's strategy for growth, product and service development, market share
position, claims, expenditures, financial results and cash requirements, are
forward-looking statements. Without limitation, projected developments in
mortgage interest rates and the overall economic environment set forth in
"Management's Discussion and Analysis of Financial Condition and Results of
Operations - Business Trends and Recent Conditions" constitute forward-looking
statements. Forward-looking statements are based on certain assumptions and
expectations of future events that are subject to a number of risks and
uncertainties. Actual future results and trends may differ materially from
historical results or those projected in any such forward-looking statements
depending on a variety of factors, including, but not limited to, the following:

•changes in interest rates and real estate values;
•changes in general economic, business, and political conditions, including the
performance of the financial and real estate markets;
•the impact of inflation;
•the impact of the ongoing military conflict between Russia and Ukraine;
•potential reform of government sponsored entities;
•the level of real estate transaction volumes, the level of mortgage origination
volumes (including refinancing), the mix of title insurance between markets with
varying real estate values, changes to the insurance requirements of the
participants in the secondary mortgage market, and the effect of these factors
on the demand for title insurance;
•the possible inadequacy of the provision for claims to cover actual claim
•the incidence of fraud-related losses;
•the impact of cyberattacks (including ransomware attacks) and other
cybersecurity events, including damage to the Company's reputation in the event
of a serious IT breach or failure;
•the impact of COVID-19, including its variants, or other pandemics, climate
change, severe weather conditions or the occurrence of another catastrophic
•unanticipated adverse changes in securities markets could result in material
losses to the Company's investments;
•significant competition that the Company's operating subsidiaries face,
including the Company's ability to develop and offer products and services that
meet changing industry standards in a timely and cost-effective manner and
expansion into new geographic locations;
•the Company's reliance upon the North Carolina, Texas, Georgia and South
Carolina markets for a significant portion of its premiums;
•compliance with government regulation, including pricing regulation, and
significant changes to applicable regulations or in their application by
•the impact of governmental oversight of compliance of the Company's service
providers, including the application of financial regulation designed to protect
•possible downgrades from a rating agency, which could result in a loss of
underwriting business;
•the inability of the Company to manage, develop and implement technological
advancements and prevent system interruptions or unauthorized system intrusions;
•statutory requirements applicable to the Company's insurance subsidiaries that
require them to maintain minimum levels of capital, surplus and reserves and
that restrict the amount of dividends they may pay to the Company without prior
regulatory approval;
•the desire to maintain capital above statutory minimum requirements for
competitive, marketing and other reasons;
•heightened regulatory scrutiny and investigations of the title insurance
•the Company's dependence on key management and marketing personnel, the loss of
whom could have a material adverse effect on the Company's business;
•difficulty managing growth, whether organic or through acquisitions;
•unfavorable economic or other conditions could cause the Company to record
impairment charges for all or a portion of its goodwill and other intangible
•policies and procedures for the mitigation of risks may be insufficient to
prevent losses;
•the shareholder rights plan could discourage transactions involving actual or
potential changes of control; and
•other risks detailed elsewhere in this document and in the Company's other
filings with the SEC.


————————————————– ——————————

These and other risks and uncertainties may be described from time to time in
the Company's other reports and filings with the SEC. For more details on
factors that could affect expectations, see the 2021 Form 10-K, including under
the heading "Risk Factors." The Company is not under any obligation (and
expressly disclaims any such obligation) and does not undertake to update or
alter any forward-looking statements to reflect circumstances or events that
occur after the date the forward-looking statements are made. You should
consider the possibility that actual results may differ materially from our
forward-looking statements.
Publici Bank to secure $50m loan from UK lender https://gosic.org/publici-bank-to-secure-50m-loan-from-uk-lender/ Sun, 06 Nov 2022 02:50:00 +0000 https://gosic.org/publici-bank-to-secure-50m-loan-from-uk-lender/

Pubali Bank Ltd is to secure a $50 million fund from British International Investment (BII), the UK’s development finance institution and impact investor, to lend to climate-related projects and boost business development. climate change mitigation in Bangladesh.

BII’s green loan will primarily be used for projects in the renewable energy, green building, textile and manufacturing sectors.

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Pubali Bank will use the facility to provide climate finance loans to its corporate clients, enabling them to purchase key equipment needed for climate projects and implement climate-related technology solutions.

A signing ceremony to that effect was held Thursday at the private commercial bank’s headquarters in Dhaka. The package will help Pubali Bank develop its technical expertise and best practices, strengthen data collection on climate finance and climate risk, and further increase the bank’s ability to launch green projects and structure climate investments. in accordance with international standards, the bank said in a press release. Release.

The BII will also provide a technical assistance program, which will strengthen the private commercial lender’s rapidly growing sustainable financing portfolio. This is BII’s first climate-related investment in Bangladesh.

“This new UK capital, focused on climate action, will direct much-needed climate finance to Bangladeshi businesses and help reduce greenhouse gas emissions,” Robert Chatterton Dickson, UK High Commissioner to Bangladesh, said in a statement. the press release.

“The UK, including the BII, is committed to working with Bangladesh to develop a trade and investment relationship that will benefit sustainable growth in both countries.”

Mohammad Ali, acting managing director of Pubali Bank, said climate change has become an economic shock in Bangladesh.

“We are seeing reduced agricultural yields, damaged infrastructure and increased cost of commodities. Through our existing portfolio of climate-related projects and pipelines, Pubali Bank understands the complex impact of climate change in the country. “

“Our partnership with the BII will allow us to expand our climate finance offering and support a wider range of clients who are preserving the environment and strengthening the economy.”

Mr. Rehan Rashid, BII Country Director, said this landmark climate investment marks the BII’s commitment to play a role in supporting economic and environmental transformation in Bangladesh.

“By helping Pubali Bank become a leading player in climate finance, BII’s capital will facilitate greater resilience and sustainability in communities, businesses and industries in Bangladesh.

Mohammad Ali and Rehan Rashid exchanged the signed documents of the agreement.

KP RE CAPITAL GROUP EXPLORES INVESTMENT AND DEVELOPMENT OPPORTUNITIES IN THE DFW METRO PLEX AS WELL AS THE NORTH TEXAS MARKET https://gosic.org/kp-re-capital-group-explores-investment-and-development-opportunities-in-the-dfw-metro-plex-as-well-as-the-north-texas-market/ Wed, 02 Nov 2022 21:26:00 +0000 https://gosic.org/kp-re-capital-group-explores-investment-and-development-opportunities-in-the-dfw-metro-plex-as-well-as-the-north-texas-market/

COO and Partner at KP RE Capital Group

DALLAS, Texas, USA, November 2, 2022 /EINPresswire.com/ — KP RE Capital Group is a multi-faceted direct lender specializing in residential and investment property. Known for being a quality developer of high-end properties in certain markets, this move to enter the Texas market could also open doors to other verticals such as energy and major land acquisitions.

KP RE has offices in New Jersey and Southern California (both founding partners are located there), as new COO Scott Ward is a current resident of Frisco Texas, so it may be a good idea to get a foothold. KP RE has just secured the initial investments from a group in Irvine CA to begin internal operations, as they have also begun a massive capital raise for their $100 million bridging lending and aggregation REIT, launching also a new FIN TECH platform which they will introduce in the first quarter of 2023.

The NORTH TEXAS development market is extremely hot right now, and with no signs of slowing down, KP RE Capital Group sees this as a stable development bonus for years to come. Statistically, there are some very clear numbers to support this, such as average home prices in Dallas increasing by over 19%, Ft Worth by 24.8%, and Celina/Prosper by over 18.2%. With so many new jobs and businesses in this area of ​​North Texas and the surrounding DFW metro plex, KP RE considers this area a “must-see” MSA both for quality investment and as a benefit to its participants. to the REIT / Debt Fund.

KP RE has also engaged and partnered with heavyweights in the field of private money lending such as Geraci Law (Geraci Law Firm), Armanino (Armanino LLP – Experts in accounting, business consulting and technology solutions) and AppFolio (property management software | AppFolio Property Management) to ensure a modern and fresh approach to investment platforms. Besides creating their own internal tech game, it looks like there’s nothing short of quality investment and solid management going forward. Data from here

Neighborhood Scott
KP RE Capital Group
+1 972-351-6949
write to us here
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80% of homeowners favor loan flexibility: CBA https://gosic.org/80-of-homeowners-favor-loan-flexibility-cba/ Sun, 30 Oct 2022 21:00:41 +0000 https://gosic.org/80-of-homeowners-favor-loan-flexibility-cba/

The flexibility of a mortgage loan is one of the top priorities for mortgagors, according to the Commonwealth Bank of Australia.

Nearly 80% of homeowners cited home loan flexibility, such as recalculation and multiple clearing accounts, and flexible features, including the ability to change repayments in-app or online, were key to their needs.

According to the Commonwealth Bank of Australia (CBA), there were subtle differences in home loan priorities when analyzing the needs of different generations.

Baby boomers and Gen X respondents returned similar data in terms of their top priorities.

Boomers listed a range of different flexible features as top priorities, with one in two saying the ability to redraw was crucial, and a quarter saying multiple clearing accounts were a “must have”.

Additionally, 41% of baby boomers said the general flexibility of home loans, such as the ability to streamline changes in repayments or loan types, would be an important feature when looking for a new loan.

Gen Xers also called home loan flexibility a top priority for their next loan, with two out of five repayment offers a top consideration.

Younger generations of homeowners, while listing mortgage flexibility as a top priority, also cited digital tools and the ability to easily access mortgage specialists as a priority.

For millennials, flexible features, multiple clearing accounts and redesign facilities were priorities, with two in five respondents calling them key factors. Not too different from the digital-focused Gen Z cohort, 25% of millennial homeowners also said having an app to manage home loans in one place was a key feature.

Nearly 60% of homeowners said the ability to instantly change their repayment amount through apps would make a difference, while 61% said it would make it easier for them to manage their mortgage.

The ABC’s Executive Managing Director, Home Buying, Dr Michael Baumann, said: “Often dubbed ‘digital natives’, it’s no surprise to learn that 32% of Gen Z homeowners named a one-stop-shop loan management app as a key feature for their next home loan.

“Interestingly, despite their desire for digital tools and features, this cohort also said that the support of their loan specialist was one of the factors considered when choosing a future home loan.

“It shows the continued demand for a blended experience of digital self-service and expert support and assistance.”

Dr Baumann added that it’s clear from the research that homeowners are “looking for a mortgage and a lender that can grow with them throughout their lifetime”.

“In fact, when homeowners were asked what their biggest concern was when it came to taking out a home loan, over 50% said they would be concerned if their loan was not flexible and ‘they couldn’t make changes to it because necessaryconcluded Dr. Baumann.

“This included concerns about not being able to make changes to their loan if their circumstances changed or that they would not be covered if something happened to their family and they could not make their repayments.”

BOQ Group Chief Executive George Frazis recently announced that all banks under the BOQ brand will have digital mortgages by 2024/25.

This is a continuation of the group’s digitization process, with already $1.5 billion in deposits on the group’s digital platform. BOQ intends to build and test its home loan core and creation before launching “simple” digital mortgages for new customers in 2024.

[RELATED: BOQ Group to roll out digital mortgages in 2024/25]

AMERESCO, INC. : Creation of a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Arrangement of a Registrant (Form 8-K) https://gosic.org/ameresco-inc-creation-of-a-direct-financial-obligation-or-obligation-under-an-off-balance-sheet-arrangement-of-a-registrant-form-8-k/ Thu, 27 Oct 2022 20:30:15 +0000 https://gosic.org/ameresco-inc-creation-of-a-direct-financial-obligation-or-obligation-under-an-off-balance-sheet-arrangement-of-a-registrant-form-8-k/

Section 2.03. Creation of a direct financial obligation or an obligation under an off-balance sheet arrangement.

On October 26, 2022one of Ameresco, Inc. (“Ameresco”) subsidiaries (“RNG Holdings“), a holding company for three renewable natural gas project companies (the “Project Companies”), has entered into a loan agreement (the “RNG Credit Facility”) with HA RNG Lender LLCa subsidiary of Hannon Armstrong Sustainable Infrastructure Capital, Inc. The RNG Credit Facility refinanced and increased borrowings available under a non-recourse credit facility which RNG Holdings
and the Project Companies concluded on October 23, 2020for a principal amount of up to $50 million which was to expire March 31, 2026 (the “Prior Facility”).

The loan must mature on October 26, 2037provides a principal amount of up to $125 million and bears interest at a rate of 6.5% with a residual percentage of the distributable cash flow payable after the maturity date of the loan, until the lender obtains an “IRR” of 8.25% on the funds borrowed under the facility, or discharge from the facility Date of October 26, 2047. Principal and interest payments are due in quarterly installments on a five (5) year amortization schedule, with principal payments adjusted based on the distributable cash flows of the three renewable natural gas projects (“Projects”). ) owned and operated by the Project Companies. No initial, commitment or structuring fees were payable on the credit facility.

At closing, RNG Holdings pulled down $80 million under the RNG credit facility, approximately $26.5 million of which was used to repay all amounts outstanding under the prior facility and the remainder was used to terminate swap obligations, pay transaction costs, make permitted distributions to
Ameresco and for the working capital needs of Project Companies. The facility allows the use of two additional drawdowns, subject to certain conditions, up to the amount of remaining principal, to make distributions to Ameresco.

RNG Holdings is the borrower under the RNG Credit Facility. The obligations under the facility are guaranteed by all RNG Holdings subsidiaries and are guaranteed by RNG Holdings’ and the assets of its subsidiaries as well as from Ameresco
stake in RNG Holdings. Borrowings under the Credit Facility are otherwise non-recourse Ameresco.

All borrowings may be repaid prior to maturity in whole or in part at RNG Holdings
option after three years provided the lender’s IRR is met and against a prepayment of 102% of par for prepayments between October 26, 2025 and October 25, 2027 and 101% of par for early redemptions between October 26, 2027 and October 25, 2029. No call bonus applies for payments on or after October 26, 2029. The facility is subject to mandatory prepayment provisions customary for non-recourse project financings of this type.

The RNG Credit Facility contains positive and negative covenants customary in non-recourse project financings of this type, including covenants restricting the ability to RNG Holdings and the ability of its subsidiaries, subject to negotiated exceptions, to: create liens or warranty obligations; incur additional debt; transfer or lease assets; change business activity; pay dividends and make other distributions; make investments; merge or liquidate; issue additional shares; engage in transactions with affiliates; and edit important project documents. Any breach of the credit facility covenants could prevent RNG Holdings to be able to borrow additional funds and would constitute a default. The RNG credit facility also includes several other customary events of default, including a change of control of RNG Holdings and breach of material project agreements, such as off-take agreements, gas supply agreements, leases and easements. If an event of default occurs and is not cured within the applicable grace period or waived, the lender would be entitled to take various actions, including accelerating amounts due under the RNG Credit Facility, the termination of the Credit Facility and the enforcement of liens against the Collateral.

————————————————– ——————————

© Edgar Online, source Previews

3 things you need to know https://gosic.org/3-things-you-need-to-know/ Mon, 24 Oct 2022 14:58:51 +0000 https://gosic.org/3-things-you-need-to-know/

According to the Fifth Circuit Court of Appeals: the funding structure of the Consumer Financial Protection Bureau (CFPB) is unconstitutional, and the 2017 payday loan rulewhich resulted directly from this unconstitutional financing mechanism, must be cancelled.

Does this mean that the CFPB itself is unconstitutional? What does this mean in the long term for the CFPB? And what does this explosive decision mean for the ARM industry?

To gauge where we’re headed, here are three things you need to know about the October 19, 2022 advisory in Community Financial Services Association of America vs. CFPB (Case No. 21-50826, 5th Cir. 2022):

1. The Court declared that the funding structure of the CFPB was unconstitutional. Does this mean that the CFPB itself is unconstitutional?


The Community Financial Services Association of America (CFSA) argued that the CFPB’s “vague and sweeping” regulatory power is too broad without guiding principles and therefore violates the Constitution’s separation of powers. The Court disagreed. Instead, he argued that while the limits set for the CFPB’s regulatory authority are broad, they exist and are bounded. Further, because Congress’ grant of regulatory power to the CFPB was accompanied by specific purpose, objectives, and definitions to guide its discretion, the grant of power to the CFPB goes the extra mile and is sufficient.


That said, although the CFPB has the power to make rules, the Court ruled that its funding structure was unconstitutional. Under the appropriations clause of the constitution, under our system of checks and balances, congress has “power over the purse.” Most of the other executive agencies rely on annual appropriations for their funding. However, the CFPB is not obliged to resort to credits. Instead, it simply requests an amount from the Federal Reserve that the CFPB Director deems reasonably necessary to carry out CFPB business. As long as this request does not exceed 12% of the Federal Reserve’s total operating expenditures, the request must be granted. According to the Fifth Circuit, this “double insulation of the Congressional purse strings” is unconstitutional.

Regarding the seriousness of the CFPB’s unconstitutional funding mechanism, the Court referenced a quote from Alexander Hamilton and did not mince words, stating: “An expansive executive agency isolated (no, double-insulated) from the cords of the congressional purse, expressly exempt from budget review, and headed by a single director removable at the pleasure of the president is the epitome of the unification of the purse and the sword in the executive – an abomination whose framers have warned that it would “destroy that division of powers on which political liberty is founded”.

2. If the CFPB was funded inappropriately, does that mean that all CFPB rules are invalidated?

Not yet. Jits decision does not mean that every rule created by the CFPB since its inception is automatically invalidated. The Court explicitly stated that although it ruled that the CFPB’s funding structure was unconstitutional, the ACSA was not entitled to a mandatory strike down of the payday loans rule.

Instead, the Court explained that cancel the rule, ACSA must demonstrate that the unconstitutional funding provision caused harm. That said, the Court found that in this case the harm inflicted was straightforward, as a report by the CFPB shows that it spent over nine million dollars on “research, markets and regulation” over the course of the fiscal quarter in which the rule was published. From CFPB lacked other means to promulgate the rule without its unconstitutional funding, ACSA showed sufficient prejudice and the rule was struck down.

3. So what does this mean for the CFPB payday loan rule? If the Bureau had been properly funded, would the rule have survived?

The Court did not say the payday loan rule was unconstitutional or that the CFPB lacked the power to create it.

The Consumer Financial Protection Act (the Act) provides the CFPB with the power to make rules prohibiting “unfair, deceptive or abusive” acts or practices in connection with consumer financial products or services. There are specific definitions in the Act that govern when an act or practice may be considered “unfair” or “abusive”. Under the Act, an act or practice meets the definition of “unfair” if the CFPB has a reasonable basis to conclude that (1) the act or practice causes or is likely to cause substantial harm to customers; (2) is not reasonably avoidable by consumers; and (3) is not outweighed by countervailing benefits to consumers or competition.

As explained in more detail here, the payday loan rule regulates payday loans, vehicle titles, and high-cost installment loans. Its provisions include a ban on attempting to debit an account again after two unsuccessful attempts. While ACSA did not dispute that consumers may suffer injuries from failed payment attempts, it argued that lenders were not the cause of these injuries since the consumer’s bank decides to charge a fee or to close the account. Since lenders do not charge fees for attempted withdrawals, ACSA argued that attempting to withdraw funds repeatedly does not meet the definition of “unfair” and therefore the CFPB does not have the authority to regulate this practice.

The Court disagreed with the CFSA. He concluded that the definition of “unfair” was satisfied because consumers would not be harmed without the repeated initiation of unsuccessful takedown attempts. Although the NSF charge comes from a third party (namely the consumer’s financial institution), the role played by the lenders in causing the harm cannot be erased. The court also rejected ACSA’s arguments that consumers could reasonably avoid fees if they fund their accounts properly or choose not to use these financial products.

You can read the full review here.

Legal Advisory Council Reflections

Here is what some members of the Consumer Relations Consortium Legal Advisory Board had to say.

Joanne NeedlemanMember, Clark Hill, PLC – “Even though the industry didn’t like the CFPB, I don’t think after a decade it was ever about its existence, but how it went about regulating the market for consumer financial services. Financial services regulators are nothing new. It was the sheer scale of power and irresponsibility that was a concern. Because of his irresponsibility, he lost his credibility. was also about its attitude that the only way to protect consumers was to take a totalitarian approach. No one ever believed it was an “independent” agency, and that was certainly true under the law. previous administration when you saw how Congress reacted when they didn’t have “their” person in the CFPB. Since its inception, the CFPB has been political football and the financial services industry just can’t function in this type In the future, I hope the changes s brought to the CFPB will bring more collaboration, more opportunities to build consensus, and more measured approaches so that consumers can get the most out of the benefits of the CFPB’s work. The time has come to bring a commission to the CFPB.”

Brit SuttelShareholder, Barron & Newburger, CP. – “I think the decision is fascinating and the industry will definitely feel the ripple effects. I think right now the focus continues to be on the 5th circuit because it’s the only circuit where the ruling has precedent effect. The outfit will likely be a priority in the case that has been filed against the CFPB by various professional organizations regarding the update of the UDAAP exam regarding fair lending and discrimination. I believe also that it is very likely that it will end up in the Supreme Court.

Stefanie JackmanPartner, Troutman pepper -“An appeal is very likely. Many believe the Fifth Circuit has gone further than necessary with its remedy. If the Supreme Court agrees that the funding process is unconstitutional, but agrees that it is not possible to unwind more than a decade of activity, the easiest solution for the Court might be to simply delete the wording from Dodd-Frank exempting the CFPB from the appropriations process. This should by default be funded by appropriations and would also be in line with Chief Justice Roberts’ position that the Court should not legislate or rewrite the law. »

John Bedard, Bedard Law Group, PC-“I am so happy to see the courts finally listening to the arguments about the [un]constitutionality of the CFPB. Hopefully, this ruling will make other courts across the country think twice before cavalierly dismissing constitutional challenges against the CFPB.”

InsideARM perspective

Only time will tell what the long-term effects of this case will be. The CFPB did not put a “closed for business” sign on its door when the notice was issued. It is also important to note that had the CFPB been properly funded, the payday lenders rule would have survived. With that in mind, it would be unwise to untangle compliance procedures or assume that the CFPB will disappear anytime soon. However, this case may be the catalyst for some change at the CFPB and certainly gives people inside and outside the Fifth Circuit Court of Appeals a reason to move to dismiss the actions of the CFPB.