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Mortgage Servicing Rights
 12 Months Ended
Dec. 31, 2018
Disclosures Pertaining to Servicing Assets and Servicing Liabilities [Abstract]  
Mortgage Servicing Rights
Mortgage Servicing Rights (“MSRs”)

Following is a summary of the changes in the carrying value of MSRs, accounted for at fair value, for the years ended December 31, 2018, 2017 and 2016:

 
 
December 31,
 
December 31,
 
December 31,
(Dollars in thousands)
 
2018
 
2017
 
2016
Balance at beginning of year
 
$
33,676

 
$
19,103

 
$
9,092

Additions from loans sold with servicing retained
 
33,071

 
18,341

 
13,091

Additions from acquisitions
 
13,806

 
—

 
—

Estimate of changes in fair value due to:
 
 
 
 
 
 
Payoffs and paydowns
 
(5,039
)
 
(2,595
)
 
(2,325
)
Changes in valuation inputs or assumptions
 
(331
)
 
(1,173
)
 
(755
)
Fair value at end of year
 
$
75,183

 
$
33,676

 
$
19,103

Unpaid principal balance of mortgage loans serviced for others
 
$
6,545,870

 
$
2,929,133

 
$
1,784,760



The Company recognizes MSR assets upon the sale of residential real estate loans to external third parties when it retains the obligation to service the loans and the servicing fee is more than adequate compensation. The initial recognition of MSR assets from loans sold with servicing retained and subsequent changes in fair value of all MSRs are recognized in mortgage banking revenue. MSRs are subject to changes in value from actual and expected prepayment of the underlying loans. The Company does not specifically hedge the value of its MSRs.

Fair values are determined by using a discounted cash flow model that incorporates the objective characteristics of the portfolio as well as subjective valuation parameters that purchasers of servicing would apply to such portfolios sold into the secondary market. The subjective factors include loan prepayment speeds, discount rates, servicing costs and other economic factors. The Company uses a third party to assist in the valuation of MSRs.