7) Bank and Other Loans Payable

12 Months Ended

Dec. 31, 2017

Notes

7) Bank and Other Loans Payable

7)         Bank and Other Loans Payable

Bank and other loans payable are summarized as follows:

	December 31
	2017	2016
1.65% above the monthly LIBOR rate note payable in monthly installments of $13,741 including principal and interest, collateralized by  real property with a book value of approximately $498,000, paid in full in November 2017.	$               -	$       147,346
Mark to market of interest rate swaps (discussed below) adjustment, terminated in November 2017	-	3,308
6.50% note payable in monthly installments of $1,702 including principal and interest, collateralized by real property with a book value of approximately $271,000, due October 2041.	246,847	251,072
2.25% above the monthly LIBOR rate (1.56% at December 31, 2017) plus 1/16th of the monthly LIBOR rate note payable in monthly principal payments of $13,167 plus interest, collateralized by real property with a book value of approximately $4,457,000, due September 2021.	2,975,781	3,133,787
3.85% fixed note payable in monthly installments of $85,419 including principal and interest, collateralized by shares of Security National Life Insurance Company stock, due January 2018.	85,419	1,093,349
4.27% fixed note payable in monthly installments of $53,881 including  principal and interest, collateralized by shares of Security National Life Insurance Company stock, due November 2021.	2,372,690	2,904,354
4.40% fixed note payable in monthly installments of $46,825 including principal and interest, collateralized by real property with a book value of approximately $11,837,000, due January 2026.	7,712,854	7,927,526
4.329% fixed note payable in monthly installments of $9,775 including principal and interest, collateralized by real property with a book value of approximately $3,004,000, due September 2025.	1,961,573	1,992,056
2.5% above the monthly LIBOR rate (1.56% at December 31, 2017) plus 1/16th of the monthly LIBOR rate construction loan payable, collateralized by real property with a book value of approximately $45,406,000, due August 2019.	28,343,684	8,777,941
2.25% above 90 day LIBOR rate (1.69% at December 31, 2017) note payable in monthly installments of  approximately $125,000, collateralized by real property with a book value of approximately $34,431,000, due October 2019.	26,773,058	27,377,114
1 month LIBOR rate (1.56% at December 31, 2017) plus 3% loan purchase agreement with a warehouse line availability of $100,000,000, matures June 2018	61,298,220	76,843,180
1 month LIBOR rate (1.56% at December 31, 2017) plus 3% loan purchase agreement with a warehouse line availability of $100,000,000, matures September 2018	25,538,378	21,578,951
Other loans payable	142,421	110,695
Total bank and other loans	157,450,925	152,140,679
Less current installments	88,437,940	101,177,574
Bank and other loans, excluding current installments	$   69,012,985	$  50,963,105

Revolving Lines of Credit

The Company has a $2,000,000 revolving line-of-credit with a bank with interest payable at the prime rate minus .75% (3.75% at December 31, 2017), secured by the capital stock of Security National Life and maturing September 30, 2018, renewable annually. At December 31, 2017, the Company was contingently liable under a standby letter of credit aggregating $625,405, to be used as collateral to cover any contingency related to additional risk assessments pertaining to the Company's captive insurance program and under a standby letter of credit aggregating $48,220 issued as a security deposit to guarantee payment of final bills for electric and gas utility services for a commercial real estate property owned by the Company in Wichita, Kansas. These standby letters of credit will draw on the line of credit if necessary. The Company does not expect any material losses to result from the issuance of the standby letter of credit because claims are not expected to exceed premiums paid. As of December 31, 2017, there were no amounts outstanding under the revolving line-of-credit.

The Company also has a $2,500,000 revolving line-of-credit with a bank with interest payable at the overnight LIBOR rate plus 2.25% (3.68% at December 31, 2017) maturing September 30, 2018. At December 31, 2017, SecurityNational Mortgage was contingently liable under a standby letter of credit aggregating $1,250,000, to be used as collateral to cover any contingency relating to claims filed in states where SecurityNational Mortgage is licensed. This standby letter of credit will draw on the line of credit if necessary. The Company does not expect any material losses to result from the issuance of the standby letters of credit. As of December 31, 2017, there were no amounts outstanding under the revolving line-of-credit.

Mortgage Warehouse Lines of Credit

The Company, through its subsidiary SecurityNational Mortgage, has a $100,000,000 line of credit with Wells Fargo Bank N.A. The agreement charges interest at the 1-Month LIBOR rate plus 3% and matures on June 16, 2018.  SecurityNational Mortgage is required to maintain an adjusted tangible net worth of $19,000,000, unrestricted cash of $10,000,000, indebtedness to adjusted tangible net worth of 12:1, liquidity overhead coverage of 1.75:1, and a quarterly gross profit of at least $1.

The Company, through its subsidiary SecurityNational Mortgage, also uses a line of credit with Texas Capital Bank N.A.   This agreement with the bank allows SecurityNational Mortgage to borrow up to $100,000,000 for the sole purpose of funding mortgage loans.  SecurityNational Mortgage is currently approved to borrow $30,000,000 of the $100,000,000 available.  The agreement charges interest at the 1-Month LIBOR rate plus 3% and matures on September 7, 2018.  The Company is required to maintain an adjusted tangible net worth of $70,000,000, unrestricted cash of $15,000,000, and no two consecutive quarters with a net loss.

In addition to financial covenants of these agreements, the Company is required to carry insurance policies for errors and omissions and general liability and was in compliance with all debt covenants as of December 31, 2017.

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

2018	$    88,437,940
2019	55,674,420
2020	1,085,699
2021	3,456,607
2022	326,923
Thereafter	8,469,336
Total	$  157,450,925

Interest expense in 2017 and 2016 was $6,037,332 and $5,111,868, respectively.