Notes Receivable

3 Months Ended

Mar. 31, 2019

Notes Receivable [Abstract]

Notes Receivable

4.  Notes Receivable

The table below provides information relating to our notes receivable and our allowance for loan losses as of March 31, 2019 and December 31, 2018 (dollars in thousands):

	As of
	March 31,		December 31,
	2019		2018
Notes receivable secured by VOIs:
VOI notes receivable - non-securitized	$	150,421	$	124,642
VOI notes receivable - securitized		421,309		447,850
		571,730		572,492
Allowance for loan losses - non-securitized		(33,628)		(28,258)
Allowance for loan losses - securitized		(103,198)		(105,875)
VOI notes receivable, net	$	434,904	$	438,359
Allowance as a % of VOI notes receivable		24%		23%
Notes receivable secured by homesites: (1)
Homesite notes receivable		805		898
Allowance for loan losses		(80)		(90)
Homesite notes receivable, net	$	725	$	808
Allowance as a % of homesite notes receivable		10%		10%
Total notes receivable:
Gross notes receivable	$	572,535	$	573,390
Allowance for loan losses		(136,906)		(134,223)
Notes receivable, net	$	435,629	$	439,167
Allowance as a % of gross notes receivable		24%		23%

(1) Notes receivable secured by homesites were originated through a business, substantially all the assets of which were sold by us in 2012.

The weighted-average interest rate on our notes receivable was 15.1%at both March 31, 2019 and December 31, 2018.  All of our VOI loans bear interest at fixed rates.  The weighted-average interest rate charged on our notes receivable secured by VOIs was15.1% at both March 31, 2019 and December 31, 2018.  Our VOI notes receivable are generally secured by property located in Florida, Missouri, Nevada, South Carolina, Tennessee, and Wisconsin.

Allowance for Loan Losses

The activity in our allowance for loan losses (including with respect to our homesite notes receivable) was as follows (in thousands):

	For the Three Months Ended
	March 31,
		2019		2018
Balance, beginning of period	$	134,223	$	123,791
Provision for loan losses		11,145		8,006
Less: Write-offs of uncollectible receivables		(8,462)		(9,100)
Balance, end of period	$	136,906	$	122,697

We monitor the credit quality of our receivables on an ongoing basis. We hold large amounts of homogeneous VOI notes receivable and assess uncollectibility based on pools of receivables as we do not believe that there are significant concentrations of credit risk with any individual counterparty or groups of counterparties.  In estimating loan losses,  we do not use a single primary indicator of credit quality but instead evaluate our VOI notes receivable based upon a static pool analysis that incorporates the aging of the respective receivables, default trends and prepayment rates by origination year, as well as the FICO scores of the borrowers.

The percentage of gross notes receivable outstanding by FICO score of the borrower at the time of origination, were as follows:

	As of
	March 31,		December 31,
	2019		2018
FICO Score
700+	57.00	%	57.00	%
600-699	39.00		39.00
<600	3.00		3.00
No Score (1)	1.00		1.00
Total	100.00	%	100.00	%

(1) VOI notes receivable attributable to borrowings without a FICO score are primarily related to foreign borrowers.

The following table shows the delinquency status of our VOI notes receivable as of March 31, 2019 and December 31, 2018 (in thousands):

	As of
	March 31,		December 31,
	2019		2018
Current	$	538,368	$	541,783
31-60 days		5,328		5,783
61-90 days		4,511		4,516
Over 91 days (1)		23,523		20,410
Total	$	571,730	$	572,492

(1) Includes$17.4 million and $14.3 million as of March 31, 2019 and December 31, 2018, respectively, related to VOI notes receivable that, as of such date, had defaulted, but the related VOI note receivable balance had not yet been charged off in accordance with the provisions of certain of our receivable-backed notes payable transactions. These VOI notes receivable have been reflected in the allowance for loan losses.