NOTE 5. VARIABLE INTEREST ENTITIES

As discussed in Note 1, “Summary of Significant Accounting Policies,” we have determined that we are the primary beneficiary of certain securitization trusts. The following table presents a summary of the assets and liabilities of our consolidated securitization trusts as of December 31, 2019 and December 31, 2018:


	December 31,		December 31,
	2019		2018
	(in thousands)
Residential mortgage loans held-for-investment through consolidated securitization trusts	$	458,348	$	549,016
Accrued interest receivable		1,495		1,792
Total assets	$	459,843	$	550,808
Accrued interest payable	$	1,448	$	1,746
Asset-backed securities issued by securitization trusts		448,987		539,651
Total liabilities	$	450,435	$	541,397

Our risk with respect to each investment in a securitization trust is limited to our direct ownership in the securitization trust. We own the most subordinated classes on all of the trusts. The residential mortgage loans held by the consolidated securitization trusts are held solely to satisfy the liabilities of the securitization trusts and the investors in the securitization trusts have no recourse to the general credit of the Company for the ABS issued by the securitization trusts. The assets of a consolidated securitization trust can only be used to satisfy the obligations of that trust. ABS are not paid down according to any schedule but rather as payments are made on the underlying mortgages. The final distribution dates for the three trusts are all at various dates in 2045. We are not contractually required and have not provided any additional financial support to the securitization trusts for the year ended December 31, 2019.

Residential Mortgage Loans Held-for-Investment Through Consolidated Securitization Trusts

Residential mortgage loans held-for-investment through consolidated securitization trusts are carried at unpaid principal balances net of any premiums or discounts and allowances for loan losses. The residential mortgage loans are secured by first liens on the underlying residential properties. As we still retain the most subordinated tranches in these trusts, we continue to be the primary beneficiary of these trusts and believe that we are still required to consolidate these trusts. During the years ended December 31, 2019 and December 31, 2018, we did not sell any of our investment in these trusts.

The following table details the carrying value for residential mortgage loans held-for-investment through consolidated securitization trusts at December 31, 2019 and December 31, 2018:


	December 31,		December 31,
	2019		2018
		(in thousands)
Principal balance	$	456,768	$	545,881
Unamortized premium and costs		1,755		3,321
Allowance for loan losses		(175)		(186)
Carrying value	$	458,348	$	549,016

The following table provides a reconciliation of the carrying value of residential mortgage loans held-for-investment through consolidated securitization trusts at December 31, 2019 and December 31, 2018:


	Year Ended
	December 31,
	2019		2018
	(in thousands)
Balance at beginning of period	$	549,016	$	639,351
Deductions during period:
Collections of principal		(89,113)		(88,338)
Principal paydowns and other deductions		(1,566)		(2,014)
Charge-offs, net		11		17
Balance at end of period	$	458,348	$	549,016

The following table details various portfolio characteristics of the residential mortgage loans held-for-investment through consolidated securitization trusts at December 31, 2019 and December 31, 2018:


	December 31,			December 31,
	2019			2018
	(dollar amounts in thousands)
Portfolio Characteristics:
Number of loans		704			829
Current principal balance	$	456,768		$	545,881
Average loan balance	$	649		$	658
Net weighted average coupon rate		3.87	%		3.85	%
Weighted average maturity (years)		24.3			25.3
Weighted average FICO score		762			761
Current Performance:
Current	$	452,875		$	543,328
30 days delinquent		2,122			—
60 days delinquent		726			896
90+ days delinquent		1,045			1,066
Bankruptcy/foreclosure		—			591
Total	$	456,768		$	545,881

The following table summarizes the geographic concentrations of residential mortgage loans held-for-investment through consolidated securitization trusts at December 31, 2019 and December 31, 2018, based on principal balance outstanding:


	December 31,		December 31,
State	2019		2018
California	43	%	43	%
Florida	7		7
Other states (none greater than 5%)	50		50
Total	100	%	100	%

Allowance for Loan Losses on Residential Mortgage Loans Held by Consolidated Securitization Trusts

As discussed in Note 1, “Summary of Significant Accounting Policies,” the Company establishes and maintains an allowance for loan losses on residential mortgage loans held by consolidated securitization trusts based on the Company’s estimate of credit losses.

The following table summarizes the activity in the allowance for loan losses for the years ended December 31, 2019 and December 31, 2018:


	Year		Year
	Ended		Ended
		December 31,		December 31,
	2019		2018

Balance at beginning of period	$	186	$	203
Charge-offs, net		(11)		(17)
Balance at end of period	$	175	$	186

Asset-Backed Securities Issued by Securitization Trusts

Asset-backed securities issued by securitization trusts are recorded at principal balances net of unamortized premiums and discounts. Asset-backed securities issued by securitization trusts are issued in various tranches and have a principal balance of $449.0 million at December 31, 2019 and $539.7 million at December 31, 2018. The investors in the asset-backed securities are not affiliated with the Company and have no recourse to the general credit of the Company.