MORTGAGE SERVICING RIGHTS (Tables)

3 Months Ended

Mar. 31, 2017

MORTGAGE SERVICING RIGHTS

Schedule of other mortgage notes serviced and changes in our mortgage servicing rights

A summary of mortgage loans serviced for others as of March 31, 2017 and December 31, 2016 is as follows (in thousands):

	March 31,		December 31,
	2017		2016
Commercial FHA mortgage loans	$	3,860,180	$	3,811,066
Residential mortgage loans		1,828,223		1,833,443
Total loans serviced for others	$	5,688,403	$	5,644,509

Changes in our mortgage servicing rights were as follows for the three months ended March 31, 2017 and 2016 (in thousands):

	Three Months Ended
	March 31,
	2017		2016
Mortgage servicing rights:
Balance at beginning of period	$	71,710	$	67,218
Servicing rights capitalized – commercial FHA mortgage loans		1,481		1,702
Servicing rights capitalized – residential mortgage loans		518		659
Amortization – commercial FHA mortgage loans		(639)		(567)
Amortization – residential mortgage loans		(735)		(714)
Balance at end of period		72,335		68,298
Valuation allowances:
Balance at beginning of period		3,702		567
Additions		188		2,245
Reductions		(112)		—
Balance at end of period		3,778		2,812
Mortgage servicing rights, net	$	68,557	$	65,486
Fair value:
At beginning of period	$	68,008	$	66,700
At end of period	$	68,557	$	65,486

Schedule of summary of key assumptions

					Remaining
	Servicing		Interest		Years to	Prepayment		Servicing		Discount
	Fee		Rate		Maturity	Rate		Cost		Rate
March 31, 2017:
Commercial FHA mortgage loans	0.13	%	3.70	%	30.0	8.29	%	$	1,000	10 - 13	%
Residential mortgage loans	0.26	%	3.89	%	24.1	9.66	%	$	61	9 - 11	%
December 31, 2016:
Commercial FHA mortgage loans	0.13	%	3.72	%	30.2	8.31	%	$	1,000	10 - 13	%
Residential mortgage loans	0.26	%	3.89	%	24.2	9.72	%	$	60	9 - 11	%