Loans Held for Investment, Allowance for Loan Losses and Loans Held for Sale

12 Months Ended

Dec. 31, 2016

Loans Held for Investment, Allowance for Loan Losses and Loans Held for Sale

Loans Held for Investment and Allowance for Loan Losses

Loans held for investment consisted of the following as of December 31 (in thousands):



	2016		2015
Term loans	$	864,066	$	482,596
Lines of credit	116,385		61,194
Total unpaid principal balance	980,451		543,790
Net deferred origination costs	19,994		8,952
Total loans held for investment	$	1,000,445	$	552,742

On June 15, 2016, we paid $6.7 million to purchase term loans that we previously sold to a third party which are included in the unpaid principal balance of loans held for investment.

We include both loans we originate and loans funded by our issuing bank partners and later purchased by us as part of our originations. During the years ended December 31, 2016, 2015 and 2014 we purchased loans in the amount of $534.1 million, $231.7 million and $180.8 million, respectively.

The activity in the allowance for loan losses for the years ended December 31 consisted of the following (in thousands):



	2016			2015			2014
Balance at January 1	$	53,311		$	49,804		$	19,443
Provision for loan losses	149,963			74,863			67,432
Loans charged off	(100,382		)	(78,485		)	(39,638		)
Recoveries of loans previously charged off	7,270			7,129			2,567
Allowance for loan losses at December 31	$	110,162		$	53,311		$	49,804

When loans are charged-off, we may continue to attempt to recover amounts from the respective borrowers and guarantors, or pursue our rights through formal legal action. Alternatively, we may sell such previously charged-off loans to a third-party debt collector. The proceeds from these sales are recorded as a component of the recoveries of loans previously charged off. For the years ended December 31, 2016, 2015 and 2014, previously charged-off loans sold accounted for $4.4 million, $5.5 million and $1.7 million, respectively, of recoveries of loans previously charged off.

As of December 31, 2016 and December 31, 2015, our off-balance sheet credit exposure related to the undrawn line of credit balances was $164.5 million and $89.1 million, respectively. The related reserve on unfunded loan commitments was $3.9 million and $4.2 million as of December 31, 2016 and December 31, 2015, respectively. Net adjustments to the accrual for unfunded loan commitments are included in general and administrative expenses.

The following table contains information, on a combined basis, regarding the unpaid principal balance of loans we originated and the amortized cost of loans purchased from third parties other than our issuing bank partner related to non-delinquent, paying and non-paying delinquent loans as of December 31 (in thousands):



	2016		2015
Non-delinquent loans	$	890,297	$	486,729
Delinquent: paying (accrual status)	36,073		28,192
Delinquent: non-paying (non-accrual status)	54,081		28,869
Total	$	980,451	$	543,790

The portion of the allowance for loan losses attributable to non-delinquent loans was $59.5 million and $27.0 million as of December 31, 2016 and December 31, 2015, respectively, while the portion of the allowance for loan losses attributable to delinquent loans was $50.7 million and $26.3 million as of December 31, 2016 and December 31, 2015, respectively.

The following table shows an aging analysis of the unpaid principal balance related to loans held for investment by delinquency status as of December 31 (in thousands):



	2016		2015
By delinquency status:
Non-delinquent loans	$	890,297	$	486,729
1-14 calendar days past due	25,899		21,360
15-29 calendar days past due	15,990		8,703
30-59 calendar days past due	22,677		10,347
60-89 calendar days past due	13,952		7,443
90 + calendar days past due	11,636		9,208
Total unpaid principal balance	$	980,451	$	543,790

Loans Held for Sale

Loans held for sale consisted of the following as of December 31 (in thousands):



	2016		2015
Loans held for sale	$	370	$	696
Net deferred origination costs	3		10
Loans held for sale, net	$	373	$	706