BUSINESS, BASIS OF PRESENTATION AND LIQUIDITY	12 Months Ended
Dec. 31, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
BUSINESS, BASIS OF PRESENTATION AND LIQUIDITY	BUSINESS, BASIS OF PRESENTATION AND LIQUIDITY Our Company IMH Financial Corporation (the “Company”) is a real estate investment and finance company based in the southwestern United States engaged in various and diverse facets of the real estate lending and investment process, including origination, acquisition, underwriting, servicing, enforcement, development, marketing, and disposition. The Company’s focus is to invest in, manage and dispose of commercial real estate mortgage investments or other real estate assets, and to perform all functions reasonably related thereto, including developing, managing and either holding for investment or disposing of real property acquired through acquisition, foreclosure or other means. We acquired certain operating properties through deed-in-lieu of foreclosure which have contributed significantly to our operating revenues and expenses. Our operating properties consist of two operating hotels and restaurants located in Sedona, Arizona, a golf course and restaurant operation located in Bullhead City, Arizona, and a multi-family housing complex in Apple Valley, Minnesota, which commenced leasing operations in the fourth quarter of 2015 and was sold in December 2016. As discussed in Note 15, we sold our two operating hotels in February 2017. The Company will serve as a property manager of the hotels in accordance with a property management agreement between the buyer and the Company. A commercial office building located in Stafford, Texas, which also contributed to operating property revenues and expenses during the year ended December 31, 2015, was sold in the third quarter of 2015. Due to our limited lending activities since 2008 and our declining loan portfolio, these operating properties contributed the majority of our operating revenues in 2016 and 2015. Our History and Structure We were formed from the conversion of our predecessor entity, IMH Secured Loan Fund, LLC (the “Fund”), into a Delaware corporation. The Fund, which was organized in May 2003, commenced operations in August 2003, focusing on investments in senior short-term whole commercial real estate mortgage loans collateralized by first mortgages on real property. The Fund was externally managed by Investors Mortgage Holdings, Inc. (the “Manager”), which was incorporated in Arizona in June 1997 and is licensed as a mortgage banker by the State of Arizona. Through a series of private placements to accredited investors, the Fund raised $875 million of equity capital from May 2003 through December 2008. Due to the cumulative number of investors in the Fund, the Fund registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), on April 30, 2007 and began filing periodic reports with the Securities and Exchange Commission, (“SEC”). On June 18, 2010, following approval by members representing 89% of membership units of the Fund voting on the matter, the Fund became internally-managed through the acquisition of the Manager, and converted into a Delaware corporation in a series of transactions that we refer to as the Conversion Transactions. Basis of Presentation The accompanying consolidated financial statements of IMH Financial Corporation have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The accompanying consolidated financial statements include the accounts of IMH Financial Corporation and the following wholly-owned operating subsidiaries: 11333, Inc. (formerly known as Investors Mortgage Holdings, Inc.), an Arizona corporation, Investors Mortgage Holdings California, Inc., a California corporation, IMH Holdings, LLC, a Delaware limited liability company (“Holdings”), and various other wholly owned subsidiaries established in connection with the acquisition of real estate either through foreclosure or purchase and/or for borrowing purposes, as well as its majority owned or controlled real estate entities and its interests in variable interest entities (“VIEs”) in which the Company is determined to be the primary beneficiary. Holdings is a holding company for IMH Management Services, LLC, an Arizona limited liability company, which provides us and our affiliates with human resources and administrative services, including the supply of employees. Other entities in which we have invested and have the ability to exercise significant influence over operating and financial policies of the investee, but upon which we do not possess control, are accounted for by the equity method of accounting within the financial statements and they are therefore not consolidated. Refer to Note 5 for further details on our equity investments and VIEs. During the second quarter of 2015, the Company, through certain subsidiaries, obtained certain real estate assets and equity interests in a number of limited liability companies and limited partnerships with various real estate holdings and related assets as a result of certain loan and guarantor enforcement and collection efforts. Certain of these entities have been consolidated in the accompanying consolidated financial statements while others have been accounted for under the equity method of accounting based on the extent of the Company’s controlling financial interest in each such entity. See Note 5 for a discussion of equity investments. All significant intercompany accounts and transactions have been eliminated in consolidation. Liquidity As of December 31, 2016, our accumulated deficit aggregated $678.8 million primarily as a result of previous provisions for credit losses recorded relating to the decrease in the fair value of the collateral securing our loan portfolio and impairment charges relating to the value of real estate owned (“REO”) assets acquired primarily through foreclosure, as well as on-going net operating losses resulting from the lack of income-producing assets, the high cost of our previous debt financing and a debt restructuring which resulted in significant debt termination charges. Beginning in 2008, we experienced significant defaults and foreclosures in our mortgage loan portfolio due primarily to the erosion of the U.S. and global real estate and credit markets during those periods. As a result, since that time we have been focused on enforcing our rights under our loan documents, working to repossess the collateral properties underlying those loans for purposes of disposing of or developing such assets, and pursuing recovery from guarantors under such loans. Our liquidity plan has included obtaining additional financing, selling mortgage loans, and selling the majority of our legacy real estate assets. We secured various financings between 2011 and 2016 which, along with proceeds from asset sales, have been our primary sources of working capital. During the year ended December 31, 2015, we completed a series of transactions to, among other things, restructure and refinance our primary senior indebtedness. As more fully described in Note 7, during the first quarter of 2015, we secured $78.8 million in new financing and repaid our prior senior debt balance and certain other bank debt. During the fourth quarter of 2015, we repaid $28.8 million owed under the new senior loans, primarily using funds from a Company custodial account, which were accumulated throughout 2015 through the sale of assets secured by the related loans. During the fourth quarter of 2015, a wholly-owned subsidiary of the Company borrowed $5.4 million pursuant to a non-revolving credit facility with the Banc of California, National Association (the “BOC Facility”), which was repaid in March 2016 upon collection of the mortgage receivable that served as collateral for that loan. During the year ended December 31, 2016, we also secured and drew down a revolving line of credit in the amount of $4.0 million (“SRE Revolver”). During 2014, the Company obtained a $5.0 million unsecured term note payable to a shareholder, SRE Monarch Lending, LLC (“SRE Monarch”), as more fully described in Note 7. During the year ended December 31, 2016, we obtained a series of extensions of the $5.0 million note payable to SRE Monarch. The SRE Monarch $5.0 million note and the SRE Revolver $4.0 million credit line were repaid in December 2016 utilizing proceeds from the asset sales. At December 31, 2016, we had cash and cash equivalents of $11.4 million and funds held by lenders and restricted cash of $2.2 million. As of December 31, 2016, our REO assets with a carrying value totaling $17.8 million and our mortgage loan portfolio with an aggregate carrying value of $0.4 million were held for sale. During the year ended December 31, 2016, we sold certain loans and REO assets generating approximately $48.0 million in cash during 2016. As discussed in Note 15, on February 28, 2017, we sold our two hotel operating properties in Sedona, AZ, in a combined cash transaction for $97.0 million (net of selling costs) resulting in a gain on sale of approximately $7.0 million. In October 2014, the Company and Titan Investments IX, LLC (“Titan”) entered into a joint venture known as Southwest Acquisitions, LLC (“Southwest JV”) for the purpose of holding and developing a multi-family project in Apple Valley, Minnesota to be known as Gabella (“Gabella”). Southwest JV simultaneously created a wholly-owned subsidiary, IMH Gabella LLC, (“IMH Gabella”) to hold the Gabella assets, and in October 2014, IMH Gabella secured a $24.0 million construction loan. The construction loan was subject to a completion and repayment carve-out guarantee by the Company and required the Company to maintain a minimum liquidity balance of $7.5 million. On various occasions during 2016, we fell below the $7.5 million liquidity threshold resulting in a non-compliance event under the terms of the guarantor agreement, and which also constituted a non-compliance event under the terms of our then current Certificate of Designation of Series B-1 Cumulative Convertible Preferred Stock and Series B-2 Cumulative Convertible Preferred Stock (“Original Certificate of Designation”). The lender did not take enforcement action regarding this non-compliance event, and we obtained a waiver from our preferred shareholders for this non-compliance event under the Original Certificate of Designation. In December 2016, Gabella was sold and the construction loan was repaid and we are no longer subject to the liquidity requirement or Company guarantees. We were also subject to a $5.0 million minimum liquidity balance for the calendar year 2016 in connection with a mortgage loan secured by our Sedona hospitality assets. In September 2016, we sought and obtained a temporary reduction of the minimum liquidity covenant to $3.0 million through December 31, 2016. In addition to this minimum liquidity requirement, the lender required our hotel operations to meet certain debt service coverage ratio (“DSCR”) and minimum 12-month rolling net operating income (“NOI”) requirements measured on a quarterly basis. Due to the operational impact of the 2015-2016 capital improvement program at our Sedona hospitality assets, our hotel operations did not meet the mortgage loan’s DSCR and NOI requirements during the quarterly measurement period in the first quarter of 2016, for which the lender provided a one-time forbearance. The hotel operations met the mortgage loan’s DSCR and NOI requirements during the remaining quarterly reporting periods of 2016. The Sedona hospitality assets were sold in the first quarter of 2017 and we repaid the loan. As a result, we are no longer subject to these DSCR and NOI requirements. We require liquidity and capital resources for our general working capital needs, including maintenance, development costs and capital expenditures for our operating properties and non-operating REO assets, professional fees, general and administrative operating costs, loan enforcement costs, financing costs, debt service payments, dividends to our preferred shareholders, as well as to acquire our target assets. We expect our primary sources of liquidity over the next twelve months to consist of our current cash and restricted cash balances, mortgage loan interest income, revenues from operating properties prior to the sale of Sedona hotels in February 2017, revenues from management of the Sedona hotels, proceeds from borrowings, and proceeds from the disposition of our existing loan and REO assets held for sale. We believe that our cash and cash equivalents, and funds held by lender and restricted cash released to us subsequent to December 31, 2016, coupled with our operating revenues, as well as proceeds that we anticipate from the disposition of our loans and real estate held for sale will be sufficient to allow us to fund our operations for a period of one year from the date these financial statements are issued. While we have been successful in securing financing through December 31, 2016 to provide adequate funding for working capital purposes, which has been supplemented by proceeds from the sale of certain REO assets and mortgage receivable collections, there is no assurance that we will be successful in selling our remaining loan and REO assets in a timely manner or in obtaining additional or replacement financing, if needed, to sufficiently fund future operations, repay existing debt or to implement our investment strategy. Our failure to generate sustainable earning assets, and successfully liquidate a sufficient number of our loans and REO assets may have a material adverse effect on our business, results of operations and financial position.

BUSINESS, BASIS OF PRESENTATION AND LIQUIDITY

Our Company

IMH Financial Corporation (the “Company”) is a real estate investment and finance company based in the southwestern United States engaged in various and diverse facets of the real estate lending and investment process, including origination, acquisition, underwriting, servicing, enforcement, development, marketing, and disposition. The Company’s focus is to invest in, manage and dispose of commercial real estate mortgage investments or other real estate assets, and to perform all functions reasonably related thereto, including developing, managing and either holding for investment or disposing of real property acquired through acquisition, foreclosure or other means.

We acquired certain operating properties through deed-in-lieu of foreclosure which have contributed significantly to our operating revenues and expenses. Our operating properties consist of two operating hotels and restaurants located in Sedona, Arizona, a golf course and restaurant operation located in Bullhead City, Arizona, and a multi-family housing complex in Apple Valley, Minnesota, which commenced leasing operations in the fourth quarter of 2015 and was sold in December 2016. As discussed in Note 15, we sold our two operating hotels in February 2017. The Company will serve as a property manager of the hotels in accordance with a property management agreement between the buyer and the Company. A commercial office building located in Stafford, Texas, which also contributed to operating property revenues and expenses during the year ended December 31, 2015, was sold in the third quarter of 2015. Due to our limited lending activities since 2008 and our declining loan portfolio, these operating properties contributed the majority of our operating revenues in 2016 and 2015.

Our History and Structure

We were formed from the conversion of our predecessor entity, IMH Secured Loan Fund, LLC (the “Fund”), into a Delaware corporation. The Fund, which was organized in May 2003, commenced operations in August 2003, focusing on investments in senior short-term whole commercial real estate mortgage loans collateralized by first mortgages on real property. The Fund was externally managed by Investors Mortgage Holdings, Inc. (the “Manager”), which was incorporated in Arizona in June 1997 and is licensed as a mortgage banker by the State of Arizona. Through a series of private placements to accredited investors, the Fund raised $875 million of equity capital from May 2003 through December 2008. Due to the cumulative number of investors in the Fund, the Fund registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), on April 30, 2007 and began filing periodic reports with the Securities and Exchange Commission, (“SEC”). On June 18, 2010, following approval by members representing 89% of membership units of the Fund voting on the matter, the Fund became internally-managed through the acquisition of the Manager, and converted into a Delaware corporation in a series of transactions that we refer to as the Conversion Transactions.

Basis of Presentation

The accompanying consolidated financial statements of IMH Financial Corporation have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The accompanying consolidated financial statements include the accounts of IMH Financial Corporation and the following wholly-owned operating subsidiaries: 11333, Inc. (formerly known as Investors Mortgage Holdings, Inc.), an Arizona corporation, Investors Mortgage Holdings California, Inc., a California corporation, IMH Holdings, LLC, a Delaware limited liability company (“Holdings”), and various other wholly owned subsidiaries established in connection with the acquisition of real estate either through foreclosure or purchase and/or for borrowing purposes, as well as its majority owned or controlled real estate entities and its interests in variable interest entities (“VIEs”) in which the Company is determined to be the primary beneficiary. Holdings is a holding company for IMH Management Services, LLC, an Arizona limited liability company, which provides us and our affiliates with human resources and administrative services, including the supply of employees. Other entities in which we have invested and have the ability to exercise significant influence over operating and financial policies of the investee, but upon which we do not possess control, are accounted for by the equity method of accounting within the financial statements and they are therefore not consolidated. Refer to Note 5 for further details on our equity investments and VIEs.

During the second quarter of 2015, the Company, through certain subsidiaries, obtained certain real estate assets and equity interests in a number of limited liability companies and limited partnerships with various real estate holdings and related assets as a result of certain loan and guarantor enforcement and collection efforts. Certain of these entities have been consolidated in the accompanying consolidated financial statements while others have been accounted for under the equity method of accounting based on the extent of the Company’s controlling financial interest in each such entity. See Note 5 for a discussion of equity investments.

All significant intercompany accounts and transactions have been eliminated in consolidation.

Liquidity

As of December 31, 2016, our accumulated deficit aggregated $678.8 million primarily as a result of previous provisions for credit losses recorded relating to the decrease in the fair value of the collateral securing our loan portfolio and impairment charges relating to the value of real estate owned (“REO”) assets acquired primarily through foreclosure, as well as on-going net operating losses resulting from the lack of income-producing assets, the high cost of our previous debt financing and a debt restructuring which resulted in significant debt termination charges. Beginning in 2008, we experienced significant defaults and foreclosures in our mortgage loan portfolio due primarily to the erosion of the U.S. and global real estate and credit markets during those periods. As a result, since that time we have been focused on enforcing our rights under our loan documents, working to repossess the collateral properties underlying those loans for purposes of disposing of or developing such assets, and pursuing recovery from guarantors under such loans.

Our liquidity plan has included obtaining additional financing, selling mortgage loans, and selling the majority of our legacy real estate assets. We secured various financings between 2011 and 2016 which, along with proceeds from asset sales, have been our primary sources of working capital. During the year ended December 31, 2015, we completed a series of transactions to, among other things, restructure and refinance our primary senior indebtedness. As more fully described in Note 7, during the first quarter of 2015, we secured $78.8 million in new financing and repaid our prior senior debt balance and certain other bank debt. During the fourth quarter of 2015, we repaid $28.8 million owed under the new senior loans, primarily using funds from a Company custodial account, which were accumulated throughout 2015 through the sale of assets secured by the related loans. During the fourth quarter of 2015, a wholly-owned subsidiary of the Company borrowed $5.4 million pursuant to a non-revolving credit facility with the Banc of California, National Association (the “BOC Facility”), which was repaid in March 2016 upon collection of the mortgage receivable that served as collateral for that loan. During the year ended December 31, 2016, we also secured and drew down a revolving line of credit in the amount of $4.0 million (“SRE Revolver”). During 2014, the Company obtained a $5.0 million unsecured term note payable to a shareholder, SRE Monarch Lending, LLC (“SRE Monarch”), as more fully described in Note 7. During the year ended December 31, 2016, we obtained a series of extensions of the $5.0 million note payable to SRE Monarch. The SRE Monarch $5.0 million note and the SRE Revolver $4.0 million credit line were repaid in December 2016 utilizing proceeds from the asset sales. At December 31, 2016, we had cash and cash equivalents of $11.4 million and funds held by lenders and restricted cash of $2.2 million.

As of December 31, 2016, our REO assets with a carrying value totaling $17.8 million and our mortgage loan portfolio with an aggregate carrying value of $0.4 million were held for sale. During the year ended December 31, 2016, we sold certain loans and REO assets generating approximately $48.0 million in cash during 2016. As discussed in Note 15, on February 28, 2017, we sold our two hotel operating properties in Sedona, AZ, in a combined cash transaction for $97.0 million (net of selling costs) resulting in a gain on sale of approximately $7.0 million.

In October 2014, the Company and Titan Investments IX, LLC (“Titan”) entered into a joint venture known as Southwest Acquisitions, LLC (“Southwest JV”) for the purpose of holding and developing a multi-family project in Apple Valley, Minnesota to be known as Gabella (“Gabella”). Southwest JV simultaneously created a wholly-owned subsidiary, IMH Gabella LLC, (“IMH Gabella”) to hold the Gabella assets, and in October 2014, IMH Gabella secured a $24.0 million construction loan. The construction loan was subject to a completion and repayment carve-out guarantee by the Company and required the Company to maintain a minimum liquidity balance of $7.5 million. On various occasions during 2016, we fell below the $7.5 million liquidity threshold resulting in a non-compliance event under the terms of the guarantor agreement, and which also constituted a non-compliance event under the terms of our then current Certificate of Designation of Series B-1 Cumulative Convertible Preferred Stock and Series B-2 Cumulative Convertible Preferred Stock (“Original Certificate of Designation”). The lender did not take enforcement action regarding this non-compliance event, and we obtained a waiver from our preferred shareholders for this non-compliance event under the Original Certificate of Designation. In December 2016, Gabella was sold and the construction loan was repaid and we are no longer subject to the liquidity requirement or Company guarantees.

We were also subject to a $5.0 million minimum liquidity balance for the calendar year 2016 in connection with a mortgage loan secured by our Sedona hospitality assets. In September 2016, we sought and obtained a temporary reduction of the minimum liquidity covenant to $3.0 million through December 31, 2016. In addition to this minimum liquidity requirement, the lender required our hotel operations to meet certain debt service coverage ratio (“DSCR”) and minimum 12-month rolling net operating income (“NOI”) requirements measured on a quarterly basis. Due to the operational impact of the 2015-2016 capital improvement program at our Sedona hospitality assets, our hotel operations did not meet the mortgage loan’s DSCR and NOI requirements during the quarterly measurement period in the first quarter of 2016, for which the lender provided a one-time forbearance. The hotel operations met the mortgage loan’s DSCR and NOI requirements during the remaining quarterly reporting periods of 2016. The Sedona hospitality assets were sold in the first quarter of 2017 and we repaid the loan. As a result, we are no longer subject to these DSCR and NOI requirements.

We require liquidity and capital resources for our general working capital needs, including maintenance, development costs and capital expenditures for our operating properties and non-operating REO assets, professional fees, general and administrative operating costs, loan enforcement costs, financing costs, debt service payments, dividends to our preferred shareholders, as well as to acquire our target assets. We expect our primary sources of liquidity over the next twelve months to consist of our current cash and restricted cash balances, mortgage loan interest income, revenues from operating properties prior to the sale of Sedona hotels in February 2017, revenues from management of the Sedona hotels, proceeds from borrowings, and proceeds from the disposition of our existing loan and REO assets held for sale. We believe that our cash and cash equivalents, and funds held by lender and restricted cash released to us subsequent to December 31, 2016, coupled with our operating revenues, as well as proceeds that we anticipate from the disposition of our loans and real estate held for sale will be sufficient to allow us to fund our operations for a period of one year from the date these financial statements are issued.

While we have been successful in securing financing through December 31, 2016 to provide adequate funding for working capital purposes, which has been supplemented by proceeds from the sale of certain REO assets and mortgage receivable collections, there is no assurance that we will be successful in selling our remaining loan and REO assets in a timely manner or in obtaining additional or replacement financing, if needed, to sufficiently fund future operations, repay existing debt or to implement our investment strategy. Our failure to generate sustainable earning assets, and successfully liquidate a sufficient number of our loans and REO assets may have a material adverse effect on our business, results of operations and financial position.