Mortgage Servicing Rights

3 Months Ended

Mar. 31, 2025

Mortgage Servicing Rights

Mortgage Servicing Rights

Note 7: Mortgage Servicing Rights

Mortgage loans serviced for others are not included in the accompanying consolidated balance sheets. The unpaid principal balances of mortgage loans serviced for others was $21,020 and $21,650 at March 31, 2025 and December 31, 2024, respectively.

The following summarizes the activity in mortgage servicing rights measured using the fair value method for the period ended March 31, 2025 and March 31, 2024:

	March 31,		March 31,
	2025		2024
Fair value as of the beginning of period	$	254	$	300
Changes in fair value due to changes in valuation inputs or assumptions		—		—
Fair value at the end of period	$	254	$	300

The estimated fair value of mortgage servicing rights is determined using a valuation model that calculates the present value of expected future servicing and ancillary income, net of expected servicing costs. The model incorporates various assumptions, such as discount rates and prepayment speeds based on market data from independent organizations. Information about the estimated fair value of mortgage servicing rights at March 31, 2025 and December 31, 2024 follows:

	March 31,		March 31,
	2025		2024
Range of discount rates	9.625-12.625	%	9.75-12.25	%
Range of prepayment speeds (1)	91-375		86-282
Weighted average default rate	1.06	%	1.24	%

Management did not utilize a valuation model to calculate the fair value of mortgage servicing rights at March 31, 2025 but Management determined the change in fair value was not significant to the financials as of March 31, 2025.

(1) Prepayment speeds measured in the Public Securities Associate Standard prepayment model (PSA). PSA is the assumed monthly rate of prepayment that is annualized to the outstanding principal balance of a mortgage loan.