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Loans (Tables)
 12 Months Ended
Dec. 31, 2021
Secured Loan Principal Transactions

Secured loan transactions for 2021 and 2020 are summarized in the following table ($ in thousands).

 

 

 

2021

 

 

2020

 

Principal, beginning of period

 

$

82,275

 

 

$

70,660

 

Loans funded

 

 

49,182

 

 

 

51,847

 

Principal collected(1)

 

 

(49,008

)

 

 

(36,370

)

Loans transferred from related mortgage fund

 

 

4,672

 

 

 

2,997

 

Loans transferred to related mortgage funds

 

 

(2,560

)

 

 

(237

)

Loans sold to non-affiliate

 

 

(3,464

)

 

 

(6,602

)

Charged off

 

 

—

 

 

 

(20

)

Principal, December 31

 

$

81,097

 

 

$

82,275

 
(1)
Includes principal collected and held in trust at December 31, 2021 of approximately $36,000.
Secured Loans Characteristics

Secured loans had the characteristics presented in the following table ($ in thousands).

 

 

 

December 31,

 

 

December 31,

 

 

 

2021

 

 

2020

 

Number of secured loans

 

 

54

 

 

 

82

 

Secured loans – principal

 

$

81,097

 

 

$

82,275

 

Secured loans – lowest interest rate (fixed)

 

 

6.8

%

 

 

6.8

%

Secured loans – highest interest rate (fixed)

 

 

10.0

%

 

 

10.5

%

 

 

 

 

 

 

 

Average secured loan – principal

 

$

1,502

 

 

$

1,003

 

Average principal as percent of total principal

 

 

1.9

%

 

 

1.2

%

Average principal as percent of members’ capital, net

 

 

2.0

%

 

 

1.3

%

Average principal as percent of total assets

 

 

1.8

%

 

 

1.2

%

 

 

 

 

 

 

 

Largest secured loan – principal

 

$

6,750

 

 

$

6,735

 

Largest principal as percent of total principal

 

 

8.3

%

 

 

8.2

%

Largest principal as percent of members’ capital, net

 

 

8.8

%

 

 

8.5

%

Largest principal as percent of total assets

 

 

8.2

%

 

 

7.9

%

 

 

 

 

 

 

 

Smallest secured loan – principal

 

$

148

 

 

$

104

 

Smallest principal as percent of total principal

 

 

0.2

%

 

 

0.1

%

Smallest principal as percent of members’ capital, net

 

 

0.2

%

 

 

0.1

%

Smallest principal as percent of total assets

 

 

0.2

%

 

 

0.1

%

 

 

 

 

 

 

 

Number of California counties where security is located

 

 

12

 

 

 

14

 

Largest percentage of principal in one California county

 

 

32.1

%

 

 

28.2

%

 

 

 

 

 

 

 

Number of secured loans with prepaid interest

 

 

2

 

 

 

—

 

Prepaid interest

 

$

643

 

 

$

—

 
Secured Loans by Lien Position in the Collateral

At funding, secured loans had the lien positions in the following table ($ in thousands).

 

 

 

December 31, 2021

 

 

December 31, 2020

 

 

 

Loans

 

 

Principal

 

 

Percent

 

 

Loans

 

 

Principal

 

 

Percent

 

First trust deeds

 

 

38

 

 

$

69,327

 

 

 

85

%

 

 

56

 

 

$

61,066

 

 

 

74

%

Second trust deeds

 

 

16

 

 

 

11,770

 

 

 

15

 

 

 

26

 

 

 

21,209

 

 

 

26

 

Total principal, secured loans

 

 

54

 

 

 

81,097

 

 

 

100

%

 

 

82

 

 

 

82,275

 

 

 

100

%

Liens due other lenders at loan closing

 

 

 

 

 

31,338

 

 

 

 

 

 

 

 

 

45,207

 

 

 

 

Total debt

 

 

 

 

$

112,435

 

 

 

 

 

 

 

 

$

127,482

 

 

 

 

Appraised property value at loan closing

 

 

 

 

$

215,683

 

 

 

 

 

 

 

 

$

251,970

 

 

 

 

Percent of total debt to appraised values
   (LTV) at loan closing(2)

 

 

 

 

 

58.0

%

 

 

 

 

 

 

 

 

55.6

%

 

 

 
(2)
Based on appraised values and liens due to other lenders at loan closing. The weighted-average loan-to-value (LTV) computation above does not take into account subsequent increases or decreases in property values following the loan closing nor does it include decreases or increases of the amount of senior liens to other lenders.
Secured Loans by Property Type of the Collateral

Secured loans summarized by property type are presented in the following table ($ in thousands).

 

 

 

December 31, 2021

 

 

December 31, 2020

 

 

 

Loans

 

 

Principal

 

 

Percent

 

 

Loans

 

 

Principal

 

 

Percent

 

Single family(3)

 

 

25

 

 

$

24,236

 

 

 

30

%

 

 

47

 

 

$

30,298

 

 

 

37

%

Commercial

 

 

19

 

 

 

41,923

 

 

 

52

 

 

 

27

 

 

 

43,692

 

 

 

53

 

Multi-family

 

 

9

 

 

 

13,438

 

 

 

16

 

 

 

8

 

 

 

8,285

 

 

 

10

 

Land

 

 

1

 

 

 

1,500

 

 

 

2

 

 

 

—

 

 

 

—

 

 

 

—

 

Total principal, secured loans

 

 

54

 

 

$

81,097

 

 

 

100

%

 

 

82

 

 

$

82,275

 

 

 

100

%
(3)
Single family property type as of December 31, 2021 consists of 7 loans with principal of $4,619,000 that are owner occupied and 18 loans with principal of $19,617,000 that are non-owner occupied. At December 31, 2020, single family property consisted of 8 loans with principal of approximately $5,565,000 that are owner occupied and 39 loans with principal of approximately $24,733,000 that are non-owner occupied.
Secured Loans Distributed within California

The distribution of secured loans by counties is presented in the following table ($ in thousands).

 

 

 

December 31, 2021

 

 

December 31, 2020

 

 

 

Principal

 

 

Percent

 

 

Principal

 

 

Percent

 

San Francisco Bay Area(4)

 

 

 

 

 

 

 

 

 

 

 

 

Santa Clara

 

$

26,064

 

 

 

32.1

%

 

$

23,206

 

 

 

28.2

%

San Francisco

 

 

22,919

 

 

 

28.3

 

 

 

11,340

 

 

 

13.8

 

San Mateo

 

 

4,985

 

 

 

6.1

 

 

 

6,878

 

 

 

8.4

 

Alameda

 

 

5,637

 

 

 

7.0

 

 

 

6,791

 

 

 

8.2

 

Contra Costa

 

 

668

 

 

 

0.8

 

 

 

1,094

 

 

 

1.3

 

Marin

 

 

—

 

 

 

—

 

 

 

1,945

 

 

 

2.4

 

 

 

 

60,273

 

 

 

74.3

 

 

 

51,254

 

 

 

62.3

 

Other Northern California

 

 

 

 

 

 

 

 

 

 

 

 

Placer

 

 

1,500

 

 

 

1.8

 

 

 

—

 

 

 

0.0

 

Monterey

 

 

—

 

 

 

0.0

 

 

 

1,110

 

 

 

1.4

 

Tehama

 

 

405

 

 

 

0.5

 

 

 

405

 

 

 

0.5

 

Butte

 

 

292

 

 

 

0.4

 

 

 

—

 

 

 

0.0

 

Sacramento

 

 

—

 

 

 

0.0

 

 

 

104

 

 

 

0.1

 

 

 

 

2,197

 

 

 

2.7

 

 

 

1,619

 

 

 

2.0

 

Northern California Total

 

 

62,470

 

 

 

77.0

 

 

 

52,873

 

 

 

64.3

 

Los Angeles & Coastal

 

 

 

 

 

 

 

 

 

 

 

 

Los Angeles

 

 

3,621

 

 

 

4.5

 

 

 

11,775

 

 

 

14.3

 

San Diego

 

 

6,043

 

 

 

7.5

 

 

 

10,186

 

 

 

12.4

 

Orange

 

 

8,444

 

 

 

10.4

 

 

 

5,432

 

 

 

6.6

 

Santa Barbara

 

 

—

 

 

 

—

 

 

 

290

 

 

 

0.3

 

 

 

 

18,108

 

 

 

22.4

 

 

 

27,683

 

 

 

33.6

 

Other Southern California

 

 

 

 

 

 

 

 

 

 

 

 

San Bernardino

 

 

519

 

 

 

0.6

 

 

 

1,719

 

 

 

2.1

 

 

 

 

519

 

 

 

0.6

 

 

 

1,719

 

 

 

2.1

 

Southern California Total

 

 

18,627

 

 

 

23.0

 

 

 

29,402

 

 

 

35.7

 

Total principal, secured loans

 

$

81,097

 

 

 

100.0

%

 

$

82,275

 

 

 

100.0

%
(4)
Includes Silicon Valley
Secured Loans Scheduled Maturities

Secured loans scheduled to mature as of December 31, 2021, are presented in the following table ($ in thousands).

 

 

 

Loans

 

 

Principal

 

 

Percent

 

2022

 

 

24

 

 

$

35,708

 

 

 

44

%

2023

 

 

17

 

 

 

32,842

 

 

 

40

 

2024

 

 

3

 

 

 

5,310

 

 

 

7

 

2025

 

 

5

 

 

 

3,741

 

 

 

5

 

2026

 

 

—

 

 

 

—

 

 

 

—

 

Thereafter

 

 

2

 

 

 

1,216

 

 

 

1

 

Total scheduled maturities

 

 

51

 

 

 

78,817

 

 

 

97

 

Matured as of December 31, 2021

 

 

3

 

 

 

2,280

 

 

 

3

 

Total principal, secured loans

 

 

54

 

 

$

81,097

 

 

 

100

%
Past Due Financing Receivables

Secured loans summarized by payment-delinquency status are presented in the following table ($ in thousands).

 

 

 

December 31, 2021

 

 

December 31, 2020

 

 

 

Loans

 

 

Principal

 

 

Loans

 

 

Principal

 

Current

 

 

47

 

 

$

72,116

 

 

 

73

 

 

$

74,042

 

Past Due

 

 

 

 

 

 

 

 

 

 

 

 

30-89 days

 

 

4

 

 

 

7,165

 

 

 

1

 

 

 

190

 

90-179 days

 

 

1

 

 

 

930

 

 

 

5

 

 

 

4,757

 

180 or more days

 

 

2

 

 

 

886

 

 

 

3

 

 

 

3,286

 

Total past due

 

 

7

 

 

 

8,981

 

 

 

9

 

 

 

8,233

 

Total principal, secured loans

 

 

54

 

 

$

81,097

 

 

 

82

 

 

$

82,275

 

In March 2022, one loan, with principal of approximately $586,000, included in the table above as 180 or more days delinquent at December 31, 2021 was paid in full.
Payments in Arrears Past Due Financing Receivables Payments in arrears for non-performing secured loans (i.e., monthly interest and principal payments past due 30 or more days) at December 31, 2021 and 2020, are presented in the following tables ($ in thousands).

 

 

 

Loans

 

 

Principal

 

 

Interest(5)

 

 

 

 

At December 31, 2021

 

Past
maturity

 

 

Monthly
payments

 

 

Past
maturity

 

 

Monthly
payments

 

 

Past
maturity

 

 

Monthly
payments

 

 

Total
payments
in arrears

 

Past due

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30-89 days
   (1-3 payments)

 

 

1

 

 

 

2

 

 

$

1,050

 

 

$

1

 

 

$

—

 

 

$

33

 

 

$

1,084

 

90-179 days
   (4-6 payments)

 

 

1

 

 

 

—

 

 

 

930

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

930

 

180 or more days
   (more than 6
   payments)

 

 

1

 

 

 

2

 

 

 

300

 

 

 

4

 

 

 

—

 

 

 

92

 

 

 

396

 

Total past due(6)

 

 

3

 

 

 

4

 

 

$

2,280

 

 

$

5

 

 

$

—

 

 

$

125

 

 

$

2,410

 
(5)
Interest includes foregone interest of approximately $63,000 on non-accrual loans with monthly payments in arrears. December 2021 interest is due January 1, 2022 and is not included in the payments in arrears at December 31, 2021.
(6)
As of March 2022, one loan included in the table above as 30-89 days past maturity and one loan included in the table above as 180 or more days past due on monthly payments paid in full. Two loans included in the table above as 30-89 days past due on monthly payments, and one loan included in the table above as 180 or more days past due on monthly payments made at least one payment.

 

 

 

 

Loans

 

 

Principal

 

 

Interest(7)

 

 

 

 

At December 31, 2020

 

Past
maturity

 

 

Monthly
payments

 

 

Past
maturity

 

 

Monthly
payments

 

 

Past
maturity

 

 

Monthly
payments

 

 

Total
payments
in arrears

 

Past due

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30-89 days
   (1-3 payments)

 

 

—

 

 

 

1

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

2

 

 

$

2

 

90-179 days
   (4-6 payments)

 

 

1

 

 

 

4

 

 

 

377

 

 

 

1

 

 

 

—

 

 

 

146

 

 

 

524

 

180 or more days
   (more than 6
   payments)

 

 

1

 

 

 

1

 

 

 

1,200

 

 

 

—

 

 

 

105

 

 

 

108

 

 

 

1,413

 

Total past due(8)

 

 

2

 

 

 

6

 

 

$

1,577

 

 

$

1

 

 

$

105

 

 

$

256

 

 

$

1,939

 
(7)
Interest includes foregone interest of $42,000 on non-accrual loans past maturity and approximately $21,000 for monthly payments in arrears. December 2020 interest is due January 1, 2021 and is not included in the payments in arrears at December 31, 2020.
(8)
One loan with principal of approximately $137,000, which was 180 or more days past due, paid in full in January 2021 and so was not designated as non-performing at December 31, 2020, and is not included in the table above.
Secured Loans in Non-Accrual Status

Secured loans in non-accrual status are summarized in the following table ($ in thousands).

 

 

 

December 31, 2021

 

 

December 31, 2020

 

Number of loans

 

 

2

 

 

 

3

 

Principal(9)

 

$

1,576

 

 

$

3,340

 

Advances

 

 

1

 

 

 

10

 

Accrued interest

 

 

35

 

 

 

181

 

Total recorded investment

 

$

1,612

 

 

$

3,531

 

Foregone interest

 

$

67

 

 

$

63

 
(9)
In March 2022, one loan, with principal of approximately $586,000 included in the 2021 table above was paid in full.
Activity in Allowance for Loan Losses

Activity in the allowance for loan losses for 2021 and 2020 are presented in the following table ($ in thousands).

 

 

 

2021

 

 

2020

 

Balance January 1,

 

$

55

 

 

$

87

 

Recovery for loan losses

 

 

—

 

 

 

—

 

Charge-offs

 

 

—

 

 

 

(32

)

Balance December 31,

 

$

55

 

 

$

55

 
Impaired Loans [Member]  
Impaired Financing Receivables

Loans designated impaired and the associated allowance for loan losses is presented in the following table ($ in thousands).

 

 

 

December 31, 2021

 

 

December 31, 2020

 

Number of loans(10)

 

 

4

 

 

 

6

 

Principal

 

$

2,806

 

 

$

7,530

 

Recorded investment(11)

 

 

2,852

 

 

 

7,896

 

Impaired loans without allowance

 

 

2,852

 

 

 

7,896

 

Impaired loans with allowance

 

 

—

 

 

 

—

 

Allowance for loan losses, impaired loans

 

 

—

 

 

 

—

 

Weighted average LTV at origination

 

 

49.5

%

 

 

52.5

%
(10)
In March 2022, one loan included in the 2021 table above with principal of approximately $586,000 paid in full, including accrued interest of approximately $37,000.
(11)
Recorded investment is the sum of the principal, advances, and accrued interest receivable for financial reporting purposes.
Average Balances and Interest Income [Member]  
Impaired Financing Receivables

Loans designated impaired had an average recorded investment and interest income recognized and received in cash as presented in the following table ($ in thousands).

 

 

 

December 31, 2021

 

 

December 31, 2020

 

Average recorded investment

 

$

5,374

 

 

$

6,308

 

Interest income recognized

 

 

167

 

 

 

705

 

Interest income received in cash

 

 

170

 

 

 

361