NOTE 8 Loan Servicing

Loans serviced for others are not included in the accompanying consolidated balance sheets. The unpaid principal balances of loans serviced for others totaled $541.9 million and $591.6 million at December 31, 2019 and 2018, respectively. Servicing loans for others generally consists of collecting mortgage payments, maintaining escrow accounts, disbursing payments to investors and collection and foreclosure processing. Loan servicing income is recorded on an accrual basis and includes servicing fees from investors and certain charges collected from borrowers, such as late payment fees, and is net of fair value adjustments to capitalized mortgage servicing rights.

The following table summarizes the Company’s activity related to servicing rights for the years ended December 31, 2019, 2018, and 2017:


	Year ended
	December 31,
(dollars in thousands)	2019		2018		2017
Balance, beginning of period	$	4,623	$	4,686	$	4,777
Additions		342		534		745
Amortization		(987)		(669)		(822)
(Impairment)/Recovery		(133)		72		(14)
Balance, end of period	$	3,845	$	4,623	$	4,686

The amount of loan servicing obligations included in other liabilities was $0 and $92 thousand as of December 31, 2019 and 2018, respectively.

The following is a summary of key data and assumptions used in the valuation of servicing rights as of December 31, 2019 and 2018. Increases or decreases in any one of these assumptions would result in lower or higher fair value measurements.


	December 31,			December 31,
(dollars in thousands)	2019			2018
Fair value of servicing rights	$	3,845		$	4,623
Weighted-average remaining term, years		20.1			20.8
Prepayment speeds		11.8	%		7.8	%
Discount rate		9.4	%		10.5	%