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RESIDENTIAL MORTGAGE LOAN SECURITIZATION TRUSTS
 9 Months Ended
Sep. 30, 2016
Residential Mortgage [Member]  
Variable Interest Entity [Line Items]  
Variable Interest Entity Disclosure [Text Block]
NOTE 7 – RESIDENTIAL MORTGAGE LOAN SECURITIZATION TRUSTS
 
The Company has elected the fair value option on the assets and liabilities of the CSMC 2014-OAK1 Trust, which requires that changes in valuations of the trust be reflected in the Company’s statements of operations. The Company’s net investment in the trust is limited to the Non-Agency RMBS comprised of subordinated and first loss securities, IO securities and excess servicing rights acquired by the Company in 2014 with an aggregate net carrying value of $6,050,612 at September 30, 2016 and $31,535,741 at December 31, 2015. The Company previously consolidated the assets and liabilities of the JPMMT 2014-OAK4 Trust, but based on the sale of subordinated and first loss securities during the second quarter of 2016, has determined that it is no longer the primary beneficiary of the trust, and accordingly no longer consolidates the assets and liabilities of this trust.
 
The condensed consolidated balance sheets of the residential mortgage loan securitization trusts at September 30, 2016 and December 31, 2015 are set out below:
 
Balance Sheets
 
September 30, 2016
 
 
December 31, 2015
 
Assets
 
 
 
 
 
 
 
 
Residential mortgage loans held in securitization trusts
 
$
153,356,678
 
 
$
411,881,097
 
Receivables
 
 
501,423
 
 
 
1,446,120
 
 
 
 
 
 
 
 
 
 
Total assets
 
$
153,858,101
 
 
$
413,327,217
 
 
 
 
 
 
 
 
 
 
Liabilities and Equity
 
 
 
 
 
 
 
 
Residential securitized debt obligations
 
$
147,407,885
 
 
$
380,638,423
 
Payables
 
 
399,604
 
 
 
1,153,053
 
 
 
$
147,807,489
 
 
$
381,791,476
 
Equity
 
 
6,050,612
 
 
 
31,535,741
 
 
 
 
 
 
 
 
 
 
Total liabilities and equity
 
$
153,858,101
 
 
$
413,327,217
 
 
The residential mortgage loans held in securitization trusts had an unpaid principal balance of $149,638,891 at September 30, 2016 and $411,650,562 at December 31, 2015. The residential mortgage loan securitized debt obligations had an unpaid principal balance of $149,638,891 at September 30, 2016 and $411,650,562 at December 31, 2015.
 
The condensed consolidated statements of operations of the residential mortgage loan securitization trusts for the three and nine months ended September 30, 2016 and September 30, 2015 are as follows:
 
Statements of Operations
 
Three Months Ended

September 30, 2016
 
 
Three Months Ended

September 30, 2015
 
Interest income
 
$
1,582,090
 
 
$
4,641,887
 
Interest expense
 
 
1,210,186
 
 
 
3,137,247
 
Net interest income
 
$
371,904
 
 
$
1,504,640
 
General and administrative fees
 
 
(13,653
)
 
 
(146,574
)
Unrealized gain (loss) on residential loans held in securitization trusts
 
 
(764,599
)
 
 
(1,323,697
)
Net income (loss)
 
$
(406,348
)
 
$
34,369
 
 
 
 
 
 
 
 
 
 
Statements of Operations
 
Nine Months Ended

September 30, 2016
 
 
Nine Months Ended

September 30, 2015
 
Interest income
 
$
9,143,343
 
 
$
15,573,046
 
Interest expense
 
 
6,978,474
 
 
 
9,894,956
 
Net interest income
 
$
2,164,869
 
 
$
5,678,090
 
General and administrative fees
 
 
(254,424
)
 
 
(495,094
)
Unrealized gain (loss) on residential loans held in securitization trusts
 
 
80,511
 
 
 
(7,655,902
)
Net income (loss)
 
$
1,990,956
 
 
$
(2,472,906
)
 
The geographic concentrations of credit risk exceeding 5% of the total loan balances related to the residential mortgage loan securitization trusts as of September 30, 2016 are as follows:
 
 
 
September 30, 2016
 
California
 
 
38.7
%
Washington
 
 
14.6
%
Massachusetts
 
 
8.9
%
Florida
 
 
5.7
%