The activity in the mortgage servicing rights (MSR) is detailed in the table below for the periods presented ($ in thousands):

	Three Months Ended March 31,
	2019			2018
Balance at beginning of period	$	95,596		$	84,269
Origination of servicing assets		2,507			3,567
Change in fair value:
Due to market changes		(8,863	)		9,521
Due to run-off		(2,398	)		(2,507	)
Balance at end of period	$	86,842		$	94,850

Trustmark determines the fair value of the MSR using a valuation model administered by a third party that calculates the present value of estimated future net servicing income. Trustmark considers the conditional prepayment rate (CPR), which is an estimated loan prepayment rate that uses historical prepayment rates for previous loans similar to the loans being evaluated, and the discount rate in determining the fair value of the MSR. An increase in either the CPR or discount rate assumption will result in a decrease in the fair value of the MSR, while a decrease in either assumption will result in an increase in the fair value of the MSR. At March 31, 2019, the fair value of the MSR included an assumed average prepayment speed of 10.19 CPR and an average discount rate of 10.04% compared to an assumed average prepayment speed of 7.25 CPR and an average discount rate of 10.28% at March 31, 2018.

During the first three months of 2019 and 2018, Trustmark sold $208.9 million and $237.2 million, respectively, of residential mortgage loans. Pretax gains on these sales were recorded as noninterest income in mortgage banking, net and totaled $3.6 million for the first three months of 2019 compared to $4.6 million for the first three months of 2018. The table below details the mortgage loans sold and serviced for others at March 31, 2019 and December 31, 2018 ($ in thousands):

	March 31, 2019		December 31, 2018
Federal National Mortgage Association	$	4,205,947	$	4,204,336
Government National Mortgage Association		2,554,666		2,537,238
Federal Home Loan Mortgage Corporation		77,742		71,343
Other		21,238		21,957
Total mortgage loans sold and serviced for others	$	6,859,593	$	6,834,874

Trustmark is subject to losses in its loan servicing portfolio due to loan foreclosures. Trustmark has obligations to either repurchase the outstanding principal balance of a loan or make the purchaser whole for the economic benefits of a loan if it is determined that the loan sold was in violation of representations or warranties made by Trustmark at the time of the sale, herein referred to as mortgage loan servicing putback expenses. Such representations and warranties typically include those made regarding loans that had missing or insufficient file documentation, loans that do not meet investor guidelines, loans in which the appraisal does not support the value and/or loans obtained through fraud by the borrowers or other third parties. Generally, putback requests may be made until the loan is paid in full. However, mortgage loans delivered to Federal National Mortgage Association (FNMA) and Federal Home Loan Mortgage Corporation (FHLMC) on or after January 1, 2013 are subject to the Lending and Selling Representations and Warranties Framework updated in May 2014, which provides certain instances in which FNMA and FHLMC will not exercise their remedies, including a putback request, for breaches of certain selling representations and warranties, such as payment history and quality control review.

When a putback request is received, Trustmark evaluates the request and takes appropriate actions based on the nature of the request. Trustmark is required by FNMA and FHLMC to provide a response to putback requests within 60 days of the date of receipt. The total mortgage loan servicing putback expenses are included in other expense.

Changes in the reserve for mortgage loan servicing putback expense for mortgage loans were as follows for the periods presented ($ in thousands):

	Three Months Ended March 31,
	2019			2018
Balance at beginning of period	$	1,000		$	1,000
Provision for putback expenses		—			—
Other (1)		(125	)		—
Balance at end of period	$	875		$	1,000

(1)	Includes fair value adjustments for loans transferred due to underwriting issues as well as adjustments based on Trustmark’s mortgage loan servicing putback reserve analysis.

There is inherent uncertainty in reasonably estimating the requirement for reserves against potential future mortgage loan servicing putback expenses. Future putback expenses are dependent on many subjective factors, including the review procedures of the purchasers and the potential refinance activity on loans sold with servicing released and the subsequent consequences under the representations and warranties. Trustmark believes that it has appropriately reserved for potential mortgage loan servicing putback requests.