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

12 Months Ended

Dec. 31, 2017

Receivables [Abstract]

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

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):

	2017		2016
Term loans	$	804,227	$	864,066
Lines of credit	132,012		116,385
Total unpaid principal balance	936,239		980,451
Net deferred origination costs	16,557		19,994
Total loans held for investment	$	952,796	$	1,000,445

During the twelve months ended December 31, 2017, we paid $13.8 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, 2017, 2016 and 2015 we purchased loans in the amount of $523.0 million, $534.1 million and $231.7 million, respectively.

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

	2017			2016			2015
Balance at January 1	$	110,162		$	53,311		$	49,804
Provision for loan losses	152,926			149,963			74,863
Loans charged off	(171,272		)	(100,382		)	(78,485		)
Recoveries of loans previously charged off	17,199			7,270			7,129
Allowance for loan losses at December 31	$	109,015		$	110,162		$	53,311

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, 2017, 2016 and 2015, previously charged-off loans sold accounted for $8.3 million, $4.4 million and $5.5 million, respectively, of recoveries of loans previously charged off.

As of December 31, 2017 and December 31, 2016, our off-balance sheet credit exposure related to the undrawn line of credit balances was $204.6 million and $164.5 million, respectively. The related reserve on unfunded loan commitments was $4.4 million and $3.9 million as of December 31, 2017 and December 31, 2016, 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):

	2017		2016
Non-delinquent loans	$	850,060	$	890,297
Delinquent: paying (accrual status)	49,252		36,073
Delinquent: non-paying (non-accrual status)	36,927		54,081
Total	$	936,239	$	980,451

The portion of the allowance for loan losses attributable to non-delinquent loans was $74.0 million and $59.5 million as of December 31, 2017 and December 31, 2016, respectively, while the portion of the allowance for loan losses attributable to delinquent loans was $35.0 million and $50.7 million as of December 31, 2017 and December 31, 2016, 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):

	2017		2016
By delinquency status:
Non-delinquent loans	$	850,060	$	890,297
1-14 calendar days past due	23,611		25,899
15-29 calendar days past due	12,528		15,990
30-59 calendar days past due	22,059		22,677
60-89 calendar days past due	12,809		13,952
90 + calendar days past due	15,172		11,636
Total unpaid principal balance	$	936,239	$	980,451

Loans Held for Sale

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

	2017		2016
Loans held for sale	$	—	$	370
Net deferred origination costs	—		3
Loans held for sale, net	$	—	$	373