Loans Receivable, Net

9 Months Ended

Sep. 30, 2018

Loans Receivable, Net/Other Receivables [Abstract]

LOANS RECEIVABLE, NET

5. LOANS RECEIVABLE, NET

The monthly interest rates on loan issued at 6% and range from 8% to 30% for the nine months ended September 30, 2018 and 2017, respectively.

As of September 30, 2018 and December 31, 2017, loan receivables from third parties was $2,306,415 and $0, net of provision for loan losses of $23,298, and $0, respectively; loan receivables from related parties was $5,376,830 and $0, net of provision for loan losses of $54,311 and $0, respectively.

Loan receivable consisted of the following as of September 30, 2018 and December 31, 2017:

	September 30,  2018			December 31,  2017
	(Unaudited)
Loans receivable - third parties	$	2,329,713		$	-
Loans receivable - related parties		5,431,141			-
Total loans receivable	$	7,760,854
Allowance for loan losses		(77,609	)		-
Loans receivable, net	$	7,683,245		$	-

The loans primarily consist of factoring loans. According to the outstanding contracts during the reporting period, the maturity terms are 3 months.

The following table represents the aging of loan receivables as of September 30, 2018:

	1-29 days past due		30-59 days past due		60-89 days  past due		Over 90 days past due		Total  past due		Current		Total Loans
Loans receivables	$	2,955,822	$	-	$	-	$	-	$	2,955,822	$	4,805,032	$	7,760,854

The allowance for loan losses is maintained at a level considered adequate to provide for losses that can be reasonably anticipated. Management performs a quarterly evaluation of the adequacy of the allowance. The allowance is based on the Company’s past loan loss history, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of any underlying collateral, composition of the loan portfolio, current economic conditions and other relevant factors. This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant revision as more information becomes available.

The allowance is calculated at portfolio-level since our loans portfolio is typically of smaller balance homogeneous loans and is collectively evaluated for impairment.

Finally, as appropriate, the Company also considers individual borrower circumstances and the condition and fair value of the loan collateral, if any.

While management uses the best information available to make loan loss allowance evaluations, adjustments to the allowance may be necessary based on changes in economic and other conditions or changes in accounting guidance.

For the nine months ended September 30, 2018 and 2017, the allowance for loan losses were $81,937 and nil, respectively.

Loans with modified terms are classified as troubled debt restructurings if the Company grants such borrowers concessions and it is deemed that those borrowers are experiencing financial difficulty. Concessions granted under a troubled debt restructuring generally involve a temporary below market rate reduction in interest rate or an extension of a loan’s stated maturity date. Non-accrual troubled debt restructurings are restored to accrual status if principal and interest payments, under the modified terms, are current for six consecutive months after modification. Loans classified as troubled debt restructurings are designated as impaired. There were no loans considered impaired as of September 30, 2018 and December 31, 2017.