11) Mortgage Servicing Rights

3 Months Ended

Mar. 31, 2017

Notes

11) Mortgage Servicing Rights

11)  Mortgage Servicing Rights

The Company reports these MSRs pursuant to the accounting policy discussed in Note 7.

The following is a summary of the MSR activity for the periods presented.

	As of March 31, 2017	As of December 31, 2016
Amortized cost:
Balance before valuation allowance at beginning of year	$18,872,362	$12,679,755
MSRs proceeds from loan sales	1,357,867	8,603,154
Amortization	(797,236)	(2,410,547)
Application of valuation allowance to write down MSRs    with other than temporary impairment	-	-
Balance before valuation allowance at end of period	$19,432,993	$18,872,362
Valuation allowance for impairment of MSRs:
Balance at beginning of year	$-	$-
Additions	-	-
Application of valuation allowance to write down MSRs    with other than temporary impairment	-	-
Balance at end of period	$-	$-
Mortgage servicing rights, net	$19,432,993	$18,872,362
Estimated fair value of MSRs at end of period	$26,632,996	$25,496,832

The Company collected the following contractual servicing fee income and late fee income as reported in other revenues on the Condensed Consolidated Statement of Earnings:

	Three Months Ended Mar 31
	2017	2016
Contractual servicing fees	$1,835,873	$1,314,285
Late fees	86,338	63,055
Total	$1,922,211	$1,377,340

The following is a summary of the unpaid principal balances of the servicing portfolio for the periods presented:

	As of March 31, 2017	As of December 31, 2016
Servicing UPB	$2,744,354,316	$2,720,441,340

The following key assumptions were used in determining MSR value:

	Prepayment Speeds	Average Life(Years)	Discount Rate
March 31, 2017	3.79%	6.55	10.01
December 31, 2016	3.77%	6.52	10.01