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Mortgage Servicing Rights (Tables)
 9 Months Ended
Sep. 30, 2015
Rollforward of Mortgage Loans Held for Investment

The following table presents the rollforward of mortgage loans held for investment for the periods presented.

 

Three Months Ended September 30

 

 

Nine Months Ended

September 30

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Fair value, beginning of period

$

183,320

 

 

$

-

 

 

$

31,460

 

 

$

-

 

Principal purchased

 

92,982

 

 

 

-

 

 

 

259,752

 

 

 

-

 

Principal repaid

 

(12,153

)

 

 

-

 

 

 

(26,618

)

 

 

-

 

Change in fair value

 

1,132

 

 

 

-

 

 

 

687

 

 

 

-

 

Fair value, end of period

$

265,281

 

 

$

-

 

 

$

265,281

 

 

$

-

 

 
Schedule of Unobservable Inputs Used in Level 3 Valuation of Mortgage Loans Held for Investment

The following table provides information about the significant unobservable inputs used in the Level 3 valuation of the Company’s mortgage loans held for investment at September 30, 2015 and December 31, 2014.

 

 

September 30, 2015

 

December 31, 2014

 

 

 

 

Weighted-

 

 

 

Weighted-

Unobservable Input

 

Range

 

Average

 

Range

 

Average

Discount rate

 

2.0% - 3.3%

 

 

3.1

%

 

 

3.6% - 3.9%

 

 

3.8

%

 

Conditional refinance rate

 

12.8% - 21.1%

 

 

16.4

%

 

 

12.4% - 19.3%

 

 

15.3

%

 

Default rate

 

0% - 2.6%

 

 

0.6

%

 

 

0% - 1.5%

 

 

0.4

%

 

Loss severity

 

0% - 25.6%

 

 

15.2

%

 

 

10.2% - 19.9%

 

 

13.8

%

 

 
Schedule of Mortgage Servicing Income and Mortgage Servicing Expenses

The Company’s mortgage servicing income and mortgage servicing expenses were as follows for the three and nine months ended September 30, 2015 and 2014.

 

Three Months Ended September 30

 

 

Nine Months Ended September 30

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Servicing fee income

$

4,445

 

 

$

-

 

 

$

4,445

 

 

$

-

 

Ancillary fee income

 

117

 

 

 

-

 

 

 

117

 

 

 

-

 

Mortgage servicing fee income

 

4,562

 

 

 

-

 

 

 

4,562

 

 

 

-

 

Mortgage servicing expense

 

(464

)

 

 

-

 

 

 

(464

)

 

 

-

 

Change in representation and warranty obligations

 

(290

)

 

 

-

 

 

 

(290

)

 

 

-

 

Mortgage servicing rights income, net

$

3,808

 

 

$

-

 

 

$

3,808

 

 

$

-

 

 
Mortgage Servicing Rights  
Rollforward of Mortgage Loans Held for Investment

The following table presents the rollforward of MSR for the periods presented.

 

 

Three Months Ended September 30

 

 

Nine Months Ended September 30

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Fair value, beginning of period

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

Purchases

 

170,986

 

 

 

-

 

 

 

170,986

 

 

 

-

 

Settlements

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Change in fair value

 

(539

)

 

 

-

 

 

 

(539

)

 

 

-

 

Fair value, end of period

$

170,447

 

 

$

-

 

 

$

170,447

 

 

$

-

 

 
Schedule of Unobservable Inputs Used in Level 3 Valuation of Mortgage Loans Held for Investment

The following table provides information about the significant unobservable inputs used in the Level 3 valuation of the Company’s MSR at September 30, 2015 and December 31, 2014.

 

 

 

September 30, 2015

 

December 31, 2014

 

 

 

 

Weighted-

 

 

 

Weighted-

Unobservable Input

 

Range

 

Average

 

Range

 

Average

Discount rate

 

10.0% - 11.0%

 

 

10.3

%

 

 

-

 

-

 

Prepayment rate

 

8.5% - 36.1%

 

 

11.1

%

 

 

-

 

-

 

Delinquency rate

 

0% - 1.3%

 

 

0.7

%

 

 

-

 

-