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Fidelity Title Insurer Cuts 1,500 Jobs, Posts Loss PDF Print E-mail
Written by By: Reuters   

Fidelity National Financial, the largest U.S. title insurer, Wednesday said it cut 1,500 jobs in January, and posted a fourth-quarter loss as the housing slump drove down home sales and refinancings.

The company nevertheless said demand for new business soared in December, and in January grew more than 50 percent from December's level, an increase that reflects lower borrowing costs for customers as well as recent acquisitions.

 

The quarterly loss for the Jacksonville, Florida-based company was $1.7 million, or 1 cent per share, compared with a loss of $44.9 million, or 21 cents per share, a year earlier. Revenue fell 21 percent to $1.02 billion.

Analysts on average had expected a loss of 2 cents per share on revenue of $951 million, according to Reuters Estimates.

Results were the first since Fidelity National on Dec. 22 bought three title insurers, includingLandAmerica Financial Group's Commonwealth Land Title Insurance and Lawyers Title Insurance.

LandAmerica filed for bankruptcy protection in November after Fidelity National withdrew an offer to buy the entire company and assume more than $500 million of debt.

Analysts said buying the title businesses alone made more sense.

Fidelity National said it has cut 1,500 of the 5,500 jobs it inherited from the acquisitions and also shut 125 offices.

While more cuts are possible, it said the largest have probably taken place.

Title insurance guarantees that a property owner has title to a property and can legally transfer that title.

Fidelity National said title orders that closed in the quarter fell 17 percent to 245,200.

It said the number opened fell 7 percent to 428,200, despite a 52 percent increase in December from the prior December.

Title and escrow premiums and fees fell 22 percent to $903 million. Shares of Fidelity National closed Tuesday at $15.99 on the New York Stock Exchange. They closed last year at $17.75.

 
Why Did Fidelity terminate the merger? PDF Print E-mail
Written by LandAmerica Financial Group   

Why did Fidelity decide to terminate the merger agreement?

We were informed that the principal reason for their refusal to go forward was the pessimism over the current and foreseeable real estate economy and not because of any negative finds concerning our company.

 

 
What is the financial viability of the LandAmerica underwriters?
The LandAmerica underwriters, Lawyers Title and Commonwealth have over $300 million in combined statutory surplus. And we have some of the industry’s most stringent requirements for reserves in place to protect our policyholders. The LandAmerica underwriters’ claims reserves are backed by over $1.1 billion in cash and investments.
 
Why should I continue to place my title, closing and escrow orders with LandAmerica?
Our talented employees remain available to assist you and service your accounts. And our underwriters have the financial strength to back those orders.
 
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We know you have questions. We have answers. PDF Print E-mail

Courtesy of Google ImagesWhy did Fidelity decide to terminate the merger agreement?  We were informed that the principal reason for their refusal to go forward was the pessimism over the current and foreseeable real estate economy and not because of any negative finds concerning our company.  

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WHAT IS A §1031 EXCHANGE? PDF Print E-mail

Thanks to IRC §1031, a properly structured exchange allows an investor to sell a property, to reinvest the proceeds in a new property and to defer all capital gain taxes. IRC §1031 (a)(1) states:

 "No gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment, if such property is exchanged solely for property of like-kind which is to be held either for productive use in a trade or business or for investment."

 

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