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MORTGAGE SERVICING RIGHTS (Tables)
 6 Months Ended
Jun. 30, 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 June 30, 2017 and December 31, 2016 is as follows (in thousands):

 

 

 

 

 

 

 

 

 

 

June 30, 

 

December 31, 

 

 

 

2017

 

2016

 

Commercial FHA mortgage loans

    

$

3,880,686

    

$

3,811,066

 

Residential mortgage loans

 

 

2,085,634

 

 

1,833,443

 

Total loans serviced for others

 

$

5,966,320

 

$

5,644,509

 

 

 

Changes in our mortgage servicing rights were as follows for the three and six months ended June 30, 2017 and 2016 (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

June 30, 

 

June 30, 

 

 

    

2017

    

2016

    

2017

    

2016

    

Mortgage servicing rights:

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

 

$

72,335

 

$

68,298

 

$

71,710

 

$

67,218

 

Servicing rights acquired – residential mortgage loans

 

 

1,933

 

 

 —

 

 

1,933

 

 

 —

 

Servicing rights capitalized – commercial FHA mortgage loans

 

 

2,107

 

 

569

 

 

3,588

 

 

2,271

 

Servicing rights capitalized – residential mortgage loans

 

 

703

 

 

980

 

 

1,221

 

 

1,639

 

Amortization – commercial FHA mortgage loans

 

 

(639)

 

 

(582)

 

 

(1,278)

 

 

(1,149)

 

Amortization – residential mortgage loans

 

 

(734)

 

 

(870)

 

 

(1,469)

 

 

(1,584)

 

Balance, end of period

 

 

75,705

 

 

68,395

 

 

75,705

 

 

68,395

 

Valuation allowances:

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

 

 

3,778

 

 

2,812

 

 

3,702

 

 

567

 

Additions

 

 

1,650

 

 

2,983

 

 

1,838

 

 

5,228

 

Reductions

 

 

 —

 

 

(208)

 

 

(112)

 

 

(208)

 

Balance, end of period

 

 

5,428

 

 

5,587

 

 

5,428

 

 

5,587

 

Mortgage servicing rights, net

 

$

70,277

 

$

62,808

 

$

70,277

 

$

62,808

 

Fair value:

 

 

 

 

 

 

 

 

 

 

 

 

 

At beginning of period

 

$

68,557

 

$

65,486

 

$

68,008

 

$

66,700

 

At end of period

 

$

70,277

 

$

62,960

 

$

70,277

 

$

62,960

 

 

Schedule of summary of key assumptions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

 

    

 

 

    

 

Remaining

    

 

    

 

 

    

 

 

 

 

Servicing

 

Interest

 

Years to

    

Prepayment

 

Servicing

    

Discount

 

 

Fee

 

Rate

 

 Maturity

    

Rate

 

Cost

    

Rate

June 30, 2017:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial FHA mortgage loans

 

0.13

%

 

3.70

%

 

30.3

 

8.27

%

 

$

1,000

 

10 - 12

%

Residential mortgage loans

 

0.26

%

 

3.93

%

 

23.5

 

10.89

%

 

$

58

 

8 - 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

%