REAL ESTATE OWNED

9 Months Ended

Sep. 30, 2018

REAL ESTATE OWNED

REAL ESTATE OWNED

4.REAL ESTATE OWNED

Activity in real estate owned, net was as follows (in thousands):

	Nine Months Ended
	September 30,
	2018		2017
Beginning of year	$	2,404	$	1,824
Additions		201		1,897
Capitalized Expenditures		74		—
Sales		(1,675)		(911)
Fair value adjustments		—		(141)
End of period	$	1,004	$	2,669

Activity in the valuation allowance was as follows (in thousands):

	Nine Months Ended
	September 30,
	2018		2017
Beginning of year	$	777		$	803
Fair value adjustments		—			141
Reductions from sale		(364)			(46)
End of Period	$	413		$	898

Expenses related to foreclosed assets include (in thousands):

	Nine Months Ended
	September 30,
		2018		2017
Net gains on sales, included in other income on income statement	$	(149)	$	(11)
Fair value adjustments		—		141
Operating expenses, net of rental income		76		148
Repossession expense, net		76		289
Net expense, net of gain or loss on sales, for the period	$	(73)	$	278

	Three Months Ended
	September 30,
		2018		2017
Net (gains) losses on sales, included in other income on income statement	$	(34)	$	6
Fair value adjustments		—		103
Operating expenses, net of rental income		19		1
Repossession expense, net		19		104
Net expense, net of gain or loss on sales, for the period	$	(15)	$	110