Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2017 | Aug. 15, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | Shepherd's Finance, LLC | |
Entity Central Index Key | 1,544,190 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 0 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,017 |
Interim Condensed Consolidated
Interim Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Assets | ||
Cash and cash equivalents | $ 88 | $ 1,566 |
Accrued interest receivable | 354 | 280 |
Loans receivable, net | 28,972 | 20,091 |
Foreclosed assets | 1,095 | 2,798 |
Property, plant and equipment | 652 | 69 |
Other assets | 84 | 82 |
Total assets | 31,245 | 24,886 |
Liabilities | ||
Customer interest escrow | 829 | 812 |
Accounts payable and accrued expenses | 434 | 377 |
Accrued interest payable | 968 | 986 |
Notes payable secured | 8,820 | 7,322 |
Notes payable unsecured, net of deferred financing costs | 15,574 | 11,962 |
Due to preferred equity member | 29 | 28 |
Total liabilities | 26,654 | 21,487 |
Commitments and Contingencies (Notes 3 and 10) | ||
Redeemable Preferred Equity | ||
Series C preferred equity | 1,033 | |
Members' Capital | ||
Series B preferred equity | 1,160 | 1,150 |
Class A common equity | 2,398 | 2,249 |
Members' capital | 3,558 | 3,399 |
Total liabilities, redeemable preferred equity and members' capital | $ 31,245 | $ 24,886 |
Interim Condensed Consolidated3
Interim Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Interest Income | ||||
Interest and fee income on loans | $ 1,356 | $ 898 | $ 2,530 | $ 1,747 |
Interest expense: | ||||
Interest related to secured borrowings | 215 | 144 | 394 | 261 |
Interest related to unsecured borrowings | 401 | 292 | 768 | 537 |
Interest expense | 616 | 436 | 1,162 | 798 |
Net interest income | 740 | 462 | 1,368 | 949 |
Less: Loan loss provision | 15 | (2) | 26 | 6 |
Net interest income after loan loss provision | 725 | 464 | 1,342 | 943 |
Non-Interest Income | ||||
Gain from foreclosure of assets | 44 | 44 | ||
Gain from sale of foreclosed assets | 77 | |||
Total non-interest income | 44 | 77 | 44 | |
Income | 725 | 508 | 1,419 | 987 |
Non-Interest Expense | ||||
Selling, general and administrative | 456 | 305 | 910 | 655 |
Impairment loss on foreclosed assets | 106 | 155 | ||
Total non-interest expense | 562 | 305 | 1,065 | 655 |
Net Income | 163 | 203 | 354 | 332 |
Earned distribution to preferred equity holders | 57 | 26 | 88 | 52 |
Net income attributable to common equity holders | $ 106 | $ 177 | $ 266 | $ 280 |
Interim Condensed Consolidated4
Interim Condensed Consolidated Statements of Changes in Members' Capital (Unaudited) $ in Thousands | 6 Months Ended |
Jun. 30, 2017USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Members' capital, beginning balance | $ 3,399 |
Net income | 354 |
Contributions from members (preferred) | 10 |
Earned distributions to preferred equity holders | (88) |
Distributions to common equity holders | (117) |
Members' capital, ending balance | $ 3,558 |
Interim Condensed Consolidated5
Interim Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Cash flows from operations | ||
Net income | $ 354 | $ 332 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities | ||
Amortization of deferred financing costs | 121 | 134 |
Provision for loan losses | 26 | 6 |
Net loan origination fees deferred (earned) | 254 | (93) |
Change in deferred origination expense | (71) | (30) |
Impairment of foreclosed assets | 155 | |
Gain from foreclosure of assets | (44) | |
Gain from sale of foreclosed assets | (77) | |
Net change in operating assets and liabilities | ||
Other assets | (2) | (110) |
Accrued interest receivable | (74) | (278) |
Customer interest escrow | 17 | (80) |
Accounts payable and accrued expenses | 39 | 461 |
Net cash provided by (used in) operating activities | 742 | 298 |
Cash flows from investing activities | ||
Loan originations and principal collections, net | (9,090) | (4,057) |
Investment in foreclosed assets | (265) | (375) |
Proceeds from sale of foreclosed assets | 1,890 | |
Property plant and equipment additions | (583) | |
Net cash provided by (used in) investing activities | (8,048) | (4,432) |
Cash flows from financing activities | ||
Contributions from redeemable preferred equity | 1,004 | |
Contributions from members (preferred) | 10 | 50 |
Distributions to preferred equity holders | (58) | (51) |
Distributions to common equity holders | (117) | (235) |
Proceeds from secured note payable | 5,775 | 5,023 |
Repayments of secured note payable | (4,277) | (3,230) |
Proceeds from unsecured notes payable | 9,218 | 2,355 |
Redemptions/repayments of unsecured notes payable | (5,687) | (59) |
Deferred financing costs paid | (40) | (28) |
Net cash provided by (used in) financing activities | 5,828 | 3,825 |
Net increase (decrease) in cash and cash equivalents | (1,478) | (309) |
Cash and cash equivalents | ||
Beginning of period | 1,566 | 1,341 |
End of period | 88 | 1,032 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | 1,062 | 378 |
Non-cash investing and financing activities | ||
Earned but not paid distribution of preferred equity holders | 29 | 26 |
Foreclosure of assets | 1,813 | |
Accrued interest reduction due to foreclosure | 130 | |
Net loan origination fees (earned) due to foreclosure | $ (55) |
Description of Business and Bas
Description of Business and Basis of Presentation | 6 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Basis of Presentation | 1. Description of Business and Basis of Presentation Description of Business Description of Business Shepherd’s Finance, LLC and subsidiary (the “Company”, “we”, or “our”) was originally formed as a Pennsylvania limited liability company on May 10, 2007. We are the sole member of a consolidating subsidiary, 84 REPA, LLC. The Company operated pursuant to an operating agreement by and among Daniel M. Wallach and the members of the Company from its inception through March 29, 2012, at which time it adopted an amended and restated operating agreement. The Company lends money to residential homebuilders to construct single family homes, to develop undeveloped land into residential building lots, and to purchase and improve for sale older homes. The loans are extended to residential homebuilders and, as such, are commercial loans. We lend in 16 states as of June 30, 2017. Basis of Presentation The accompanying (a) condensed consolidated balance sheet as of December 31, 2016 , which has been derived from audited consolidated financial statements, and (b) unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. While certain information and disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), management believes that the disclosures herein are adequate to make the unaudited interim condensed consolidated information presented not misleading. In the opinion of management, the unaudited interim condensed consolidated financial statements reflect all adjustments necessary for a fair presentation of the consolidated financial position, results of operations, and cash flows for the periods presented. Such adjustments are of a normal, recurring nature. The consolidated results of operations for any interim period are not necessarily indicative of results expected for the fiscal year ending December 31, 2017. These unaudited interim condensed consolidated financial statements should be read in conjunction with the 2016 consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K as of and for the year ended December 31, 2016 (the “2016 Statements”). The accounting policies followed by the Company are set forth in Note 2 - Summary of Significant Accounting Policies |
Fair Value
Fair Value | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value | 2. Fair Value Utilizing Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) 820, the Company has established a framework for measuring fair value under U.S. GAAP using a hierarchy, which requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs. Fair value measurements are an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Three levels of inputs are used to measure fair value, as follows: Level 1 – quoted prices in active markets for identical assets or liabilities; Level 2 – Significant other observable inputs for the assets or liabilities Level 3 – Significant unobservable inputs. A financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Fair Value Measurements of Non-Financial Instruments on a Recurring Basis At June 30, 2017 and December 31, 2016, the Company had no non-financial instruments measured at fair value on a recurring basis. Fair Value Measurements of Non-Financial Instruments on a Non-Recurring Basis Foreclosed Assets Foreclosed assets consist of properties obtained through foreclosure or in satisfaction of loans and is recorded at the fair value of the property, less estimated costs to sell. Estimates of fair value are generally based on third-party appraisals of the property and are classified within Level 3 of the fair value hierarchy. The appraisals are sometimes discounted based on management’s knowledge of the property and/or changes in market conditions from the date of the most recent appraisal. Such discounts are typically significant unobservable inputs for determining fair value. Impaired Loans At June 30, 2017, the Company had impaired loans, and on December 31, 2016, it had none. A loan is considered to be impaired when it is probable the Company will be unable to collect all principal and interest payments due in accordance with the contractual terms of the loan agreement. The analysis of impaired loans includes a comparison of estimated collateral value to the principal amount of the loan. If the value determined is less than the principal amount due (less any builder deposit), then the difference is included in the allowance for loan loss. As values change, estimated loan losses may be provided for more or less than the previous period. For homes which are partially complete, we appraise on an as-is and completed basis, and use the one that more closely aligns with our planned method of disposal for the property. For loans that are individually evaluated for impairment, appraisals have been prepared within the last 13 months. There are also broker’s opinions of value (“BOV”) prepared, if the appraisal is more than six months old. The lower of any BOV prepared in the last six months, or appraisal done in the last 13 months, is used, unless we determine a BOV to be invalid based on the comparable sales used. If we determine a BOV to be invalid, we will use the appraised value. Appraised values are adjusted down for estimated costs associated with asset disposal, generally between 0% and 5%, depending on the type of collateral. Fair value estimates for impaired loans are classified as Level 3. The following tables present the balances of non-financial instruments measured at fair value on a non-recurring basis as of June 30, 2017 and December 31, 2016. June 30, 2017 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Estimated Assets Inputs Inputs Amount Fair Value Level 1 Level 2 Level 3 Foreclosed assets $ 1,095 $ 1,095 $ – $ – $ 1,095 Impaired loans $ 1,980 $ 1,980 $ – $ – $ 1,980 December 31, 2016 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Estimated Assets Inputs Inputs Amount Fair Value Level 1 Level 2 Level 3 Foreclosed assets $ 2,798 $ 2,798 $ – $ – $ 2,798 Fair Value of Financial Instruments ASC 825 requires disclosure of fair value information about financial instruments, whether or not recognized on the face of the balance sheet, for which it is practicable to estimate that value. The following methods and assumptions were used by the Company in estimating the fair value of its financial instruments: Cash and Cash Equivalents The carrying amount approximates fair value because of the short maturity of these instruments. Loans Receivable and Commitments to Extend Credit For variable rate loans that reprice frequently with no significant change in credit risk, estimated fair values are based on carrying values at both June 30, 2017 and December 31, 2016. Because the loans are demand loans and therefore have no known time horizon, there is no significant impact from fluctuating interest rates. For unfunded commitments to extend credit, because there would be no adjustment between fair value and carrying amount for the amount if actually loaned, there is no adjustment to the amount before it is loaned. The amount for commitments to extend credit is not listed in the tables below because there is no difference between carrying value and fair value, and the amount is not recorded on the consolidated balance sheets as a liability. Interest Receivable The fair value approximates the carrying value at both June 30, 2017 and December 31, 2016. Customer Interest Escrow The fair value of the customer interest escrow approximates the carrying value at both June 30, 2017 and December 31, 2016. Borrowings under Credit Facilities The fair value of the Company’s borrowings under credit facilities is estimated based on the expected cash flows discounted using the current rates offered to the Company for debt of the same remaining maturities. As all of the borrowings under credit facilities or the Fixed Rate Subordinated Notes issued pursuant to our public offering (the “Notes”) are either payable on demand or at similar rates to what the Company can borrow funds for today, the fair value of the borrowings is determined to approximate carrying value at both June 30, 2017 and December 31, 2016. The interest on our Notes offering is paid to our Note holders either monthly or at the end of their investment, compounded on a monthly basis. For the same reasons as the determination for the principal balances on the Notes, the fair value approximates the carrying value for the interest as well. The interest payable makes up the bulk of our accounts payable and accrued expenses. The table below is a summary of fair value estimates for financial instruments and the level of the fair value hierarchy (as discussed in Note 2) within which the fair value measurements are categorized at the periods indicated: June 30, 2017 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Estimated Assets Inputs Inputs Amount Fair Value Level 1 Level 2 Level 3 Financial Assets Cash and cash equivalents $ 88 $ 88 $ 88 $ – $ – Loans receivable, net 28,972 28,972 – – 28,972 Accrued interest receivable 354 354 – – 354 Financial Liabilities Customer interest escrow 829 829 – – 829 Notes payable secured 8,820 8,820 – – 8,820 Notes payable unsecured, net 15,574 15,574 – – 15,574 Accrued interest payable 996 996 – – 996 December 31, 2016 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Estimated Assets Inputs Inputs Amount Fair Value Level 1 Level 2 Level 3 Financial Assets Cash and cash equivalents $ 1,566 $ 1,566 $ 1,566 $ – $ – Loans receivable, net 20,091 20,091 – – 20,091 Accrued interest receivable 280 280 – – 280 Financial Liabilities Customer interest escrow 812 812 – – 812 Notes payable secured 7,322 7,322 – – 7,322 Notes payable unsecured, net 11,962 11,962 – – 11,962 Accrued interest payable 993 993 – – 993 |
Financing Receivables
Financing Receivables | 6 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
Financing Receivables | 3. Financing Receivables Financing receivables are comprised of the following as of June 30, 2017 and December 31, 2016: June 30, 2017 December 31, 2016 Loans receivable, gross $ 31,421 $ 21,569 Less: Deferred loan fees (872 ) (618 ) Less: Deposits (1,623 ) (861 ) Plus: Deferred origination expense 126 55 Less: Allowance for loan losses (80 ) (54 ) Loans receivable, net $ 28,972 $ 20,091 Roll forward of loans receivable, net: Six Months Ended Year Ended Six Months Ended Beginning balance $ 20,091 $ 14,060 $ 14,060 Additions 16,081 23,184 10,692 Payoffs/sales (6,229 ) (15,168 ) (6,594 ) Moved to foreclosed assets – (1,639 ) (1,639 ) Change in deferred origination expense 71 55 30 Change in builder deposit (762 ) (340 ) (41 ) Change in loan loss provision (26 ) (16 ) (6 ) New loan fees (1,153 ) (1,270 ) (540 ) Earned loan fees 899 1,225 633 Ending balance $ 28,972 $ 20,091 $ 16,595 Commercial Construction and Development Loans Pennsylvania Loans We have three development loans (the “Pennsylvania Loans”) covering two developments. The loans are to the same borrowing group (the “Hoskins Group”). They are cross-defaulted and cross-collateralized with each other. Our total commitment amount under the Pennsylvania Loans is approximately $5,231 as of June 30, 2017, as described in more detail below. As such, we are currently reliant on a single developer and homebuilder for a significant portion of our revenues. As part of our agreement with the Hoskins Group, they invest in our preferred equity in an amount equal to $10 per closing of a lot payoff in the two developments. The loans are secured by several first priority mortgages in residential building lots located in the subdivisions commonly known as the Hamlets of Springdale and the Tuscany Subdivision, both in Peters Township, Pennsylvania, a suburb of Pittsburgh, as well as the Interest Escrow. Commercial Loans – Real Estate Development Loan Portfolio Summary The following is a summary of our loan portfolio to builders for land development as of June 30, 2017. The Pennsylvania loans below are the Pennsylvania Loans discussed above. State Number of Borrowers Number of Loans Value of Collateral (1) Commitment Amount Gross Amount Outstanding Loan to Value Ratio (2) Loan Fee Pennsylvania 1 3 $ 6,298 $ 5,231 (3) $ 4,050 64 % $ 1,000 Total 1 3 $ 6,298 $ 5,231 $ 4,050 64 % $ 1,000 (1) The value is determined by the appraised value adjusted for remaining costs to be paid and third party mortgage balances. Part of this collateral is $1,160 of preferred equity in our Company. In the event of a foreclosure on the property securing certain of our loans, a portion of our collateral is preferred equity in our Company, which might be difficult to sell, which could impact our ability to eliminate the loan balance. (2) The loan to value ratio is calculated by taking the outstanding amount and dividing by the appraised value. (3) The commitment amount does not include letters of credit and cash bonds, as the sum of the total balance outstanding including the cash bonds plus the letters of credit and remaining to fund for construction is less than the $5,231 commitment amount. The following is a summary of our loan portfolio to builders for land development as of December 31, 2016. The Pennsylvania loans below are the Pennsylvania Loans discussed above. State Number of Borrowers Number of Loans Value of Collateral (1) Commitment Amount Gross Amount Outstanding Loan to Value Ratio (2) Loan Fee Pennsylvania 1 3 $ 6,586 $ 5,931 (3) $ 4,082 62 % $ 1,000 Total 1 3 $ 6,586 $ 5,931 $ 4,082 62 % $ 1,000 (1) The value is determined by the appraised value adjusted for remaining costs to be paid and third party mortgage balances. Part of this collateral is $1,150 of preferred equity in our Company. In the event of a foreclosure on the property securing certain of our loans, a portion of our collateral is preferred equity in our Company, which might be difficult to sell, which could impact our ability to eliminate the loan balance. (2) The loan to value ratio is calculated by taking the outstanding amount and dividing by the appraised value. (3) The commitment amount does not include letters of credit and cash bonds, as the sum of the total balance outstanding including the cash bonds plus the letters of credit and remaining to fund for construction is less than the $5,931 commitment amount. Commercial Loans – Construction Loan Portfolio Summary As of June 30, 2017, we have 49 other borrowers, all of whom, along with the Hoskins Group, borrow money for the purpose of building new homes. The following is a summary of our loan portfolio to builders for home construction loans as of June 30, 2017. State Number of Borrowers Number of Loans Value of Collateral (1) Commitment Amount Gross Amount Outstanding Loan to Value Ratio (2) Loan Fee Colorado 3 6 $ 3,113 $ 2,092 $ 1,082 67 % 5 % Connecticut 1 1 715 500 500 70 % 5 % Delaware 1 1 244 171 115 70 % 5 % Florida 11 42 21,930 13,904 8,110 63 % 5 % Georgia 9 22 13,958 8,405 4,991 60 % 5 % Indiana 2 2 995 597 178 60 % 5 % Michigan 3 13 3,254 2,065 1,139 63 % 5 % New Jersey 3 8 2,361 1,652 1,098 70 % 5 % New York 1 7 2,160 1,064 984 49 % 5 % North Carolina 2 7 1,740 1,218 543 70 % 5 % Ohio 2 2 2,116 1,340 777 63 % 5 % Pennsylvania 2 15 12,595 6,407 5,244 51 % 5 % South Carolina 8 14 4,071 2,699 1,350 66 % 5 % Tennessee 1 3 1,080 767 711 71 % 5 % Utah 1 3 1,208 846 353 70 % 5 % Virginia 1 1 408 260 196 64 % 5 % Total 50 (4) 147 $ 71,948 $ 43,987 $ 27,371 61 % (3) 5 % (1) The value is determined by the appraised value. (2) The loan to value ratio is calculated by taking the commitment amount and dividing by the appraised value. (3) Represents the weighted average loan to value ratio of the loans. (4) One builder borrows in multiple states. The following is a summary of our loan portfolio to builders for home construction loans as of December 31, 2016. State Number of Borrowers Number of Loans Value of Collateral (1) Commitment Amount Gross Amount Outstanding Loan to Value Ratio (2) Loan Fee Colorado 1 3 $ 1,615 $ 1,131 $ 605 70 % 5 % Connecticut 1 1 715 500 479 70 % 5 % Delaware 1 2 244 171 40 70 % 5 % Florida 7 15 14,014 8,548 4,672 61 % 5 % Georgia 4 9 6,864 4,249 2,749 62 % 5 % Idaho 1 1 319 215 205 67 % 5 % Michigan 1 1 210 126 118 60 % 5 % New Jersey 1 3 977 719 528 74 % 5 % New York 1 4 1,745 737 685 42 % 5 % North Carolina 2 2 1,015 633 216 62 % 5 % Ohio 1 1 1,405 843 444 60 % 5 % Pennsylvania 2 15 12,725 6,411 5,281 50 % 5 % South Carolina 5 7 2,544 1,591 783 63 % 5 % Tennessee 1 3 1,080 767 430 71 % 5 % Utah 1 2 715 500 252 70 % 5 % Total 30 69 $ 46,187 $ 27,141 $ 17,487 59 % (3) 5 % (1) The value is determined by the appraised value. (2) The loan to value ratio is calculated by taking the commitment amount and dividing by the appraised value. (3) Represents the weighted average loan to value ratio of the loans. Credit Quality Information The following table presents credit-related information at the “class” level in accordance with FASB ASC 310-10-50, Disclosures about the Credit Quality of Finance Receivables and the Allowance for Credit Losses Gross finance Receivables – By risk rating: June 30, 2017 December 31, 2016 Pass $ 25,791 $ 18,275 Special mention 3,643 3,294 Classified – accruing – – Classified – nonaccrual 1,987 – Total $ 31,421 $ 21,569 Gross finance Receivables – Method of impairment calculation: June 30, 2017 December 31, 2016 Performing loans evaluated individually $ 8,978 $ 12,424 Performing loans evaluated collectively 20,456 9,145 Non-performing loans without a specific reserve – – Non-performing loans with a specific reserve 1,987 – Total $ 31,421 $ 21,569 At June 30, 2017 and December 31, 2016, there were no loans acquired with deteriorated credit quality. Impaired Loans The following is a summary of our impaired nonaccrual commercial construction loans as of June 30, 2017 and December 31, 2016. All loans listed have a related allowance for loan losses. June 30, 2017 December 31, 2016 Unpaid principal balance (contractual obligation from customer) $ 1,987 $ – Charge-offs and payments applied – – Gross value before related allowance 1,987 – Related allowance 7 – Value after allowance $ 1,980 $ – Concentrations Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of loans receivable. Our concentration risks for individual borrowers are summarized in the table below: June 30, 2017 December 31, 2016 Percent of Percent of Borrower Loan Borrower Loan City Commitments City Commitments Highest concentration risk Pittsburgh, PA 23 % Pittsburgh, PA 37 % Second highest concentration risk Sarasota, FL 7 % Sarasota, FL 11 % Third highest concentration risk Orlando, FL 5 % Savannah, GA 6 % |
Foreclosed Assets
Foreclosed Assets | 6 Months Ended |
Jun. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Foreclosed Assets | 4. Foreclosed Assets Roll forward of Foreclosed Assets: Six Months Ended Year Ended Six Months Ended Beginning balance $ 2,798 $ 965 $ 965 Additions from loans – 1,813 1,813 Additions for construction/development 265 566 375 Sale proceeds (1,890 ) (463 ) – Gain on sale 77 28 – Impairment loss on foreclosed assets (155 ) (111 ) – Ending balance $ 1,095 $ 2,798 $ 3,153 |
Property, Plant and Equipment
Property, Plant and Equipment | 6 Months Ended |
Jun. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | 5. Property, Plant and Equipment In the first quarter of 2017, we purchased, for $625, a partially completed building. It is our intent to complete the building for operating purposes. As such, we invested $27 in related improvements to the building in the second quarter. No depreciation has been recorded as the building has not been placed in service. We anticipate another $400 in costs associated with this project. |
Borrowings
Borrowings | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Borrowings | 6. Borrowings The following table displays our borrowings and a ranking of priority: Priority Rank June 30, 2017 December 31, 2016 Borrowing Source Purchase and sale agreements 1 $ 8,820 $ 7,322 Secured line of credit from affiliates 2 – – Unsecured line of credit (senior) 3 500 – Other unsecured debt (senior subordinated) 4 279 279 Unsecured Notes through our public offering, gross 5 14,239 11,221 Other unsecured debt (subordinated) 5 713 700 Other unsecured debt (junior subordinated) 6 173 173 Total $ 24,724 $ 19,695 The following table shows the maturity of outstanding debt as of June 30, 2017. Year Maturing Total Amount Maturing Public Offering Other Unsecured Purchase and Sale Agreements 2017 $ 9,693 $ 373 $ 500 $ 8,820 2018 5,133 4,633 500 – 2019 3,569 3,456 113 – 2020 1,943 1,943 – – 2021 4,386 3,834 552 – Total $ 24,724 $ 14,239 $ 1,665 $ 8,820 Purchase and Sale Agreements We have two current purchase and sale agreement relationships where we are the seller of portions of loans we create. The two purchasers are Builder Finance, Inc. and S.K. Funding, LLC (“S.K. Funding”). Generally, the purchasers buy between 50% and 70% of each loan sold. Builder Finance, Inc., a subsidiary of 1st Financial Bank, USA, began purchasing portions of loans effective as of August 1, 2016. Prior to August 1, 2016, 1st Financial Bank, USA had purchased these loans under a separate loan purchase and sale agreement. S.K. Funding, an affiliate of Seven Kings Holdings, Inc. (“7Kings”), was assigned the loan purchase and sale agreement by 7Kings on or about May 7, 2015. The buyers receive interest rates ranging from our cost of funds to the note rate charged to the borrower (interest rates we paid were between 9% and 12% for both 2017 and 2016). The buyers generally receive none of the loan fees we charge. We have the right to call some of the loans sold, with some restrictions. Once sold, the buyer must fund their portion of the loans purchased. We service the loans. Also, there are limited put options in some cases, whereby the purchaser can cause us to repurchase a loan. The purchase and sale agreements are recorded as secured borrowings. The purchase and sale agreements are detailed below: June 30, 2017 December 31, 2016 Book Value of Due From Book Value of Due From Loans which Shepherd’s Loans which Shepherd’s Served as Finance to Loan Served as Finance to Loan Collateral Purchaser Collateral Purchaser Loan purchaser 1st Financial Bank, USA/Builder Finance, Inc. $ 9,507 $ 5,207 $ 5,779 $ 2,517 S.K. Funding, LLC 8,523 3,613 7,770 4,805 Total $ 18,030 $ 8,820 $ 13,549 $ 7,322 At December 31, 2016, the $7,770 of loans which served as collateral for S.K. Funding did not include the book value of the foreclosed assets which also secured their position, which amount was $1,813. At June 30, 2017, the $8,523 of loans which served as collateral for S.K. Funding included no foreclosed assets. Affiliate Loans In December 2011, the Company entered into two secured revolving lines of credit with affiliates, both of whom are members. These loans have an interest rate of the affiliates’ cost of funds, which was 4.41% and 4.19% as of June 30, 2017 and December 31, 2016, respectively. They are demand notes. The maximum that can be borrowed under these notes is $1,500, at the discretion of the lenders. The security for the lines of credit includes all of the otherwise unencumbered assets of the Company. The Company did not borrow on these lines in either 2016 or during the six months ended June 30, 2017. Other Unsecured Loans In August 2015, we entered into an unsecured note with 7Kings, under which we are the borrower. The note has a maximum amount outstanding of $500, of which $500 was outstanding as of both June 30, 2017 and December 31, 2016. Interest on the 7Kings loan accrues annually at a rate of 7.5%. The note was due on February 19, 2016 and was renewed several times. The maturity date is now August 18, 2017 and may be prepaid at any time without penalty. Interest is due at the end of each month and was $19 for both of the six month periods ended June 30, 2017 and 2016. The note is included in Other unsecured debt (subordinated) in the table at the start of this note. In January 2017, we entered into an unsecured line of credit with Builder’s Finance, Inc., under which we are the borrower. The note has a maximum amount outstanding of $500, of which $500 was outstanding as of June 30, 2017. Interest on the loan accrues annually at a rate of 10%. The maturity date is January 28, 2018 and may be prepaid at any time without penalty. Interest is due at the end of each month and was $18 for the six month period ended June 30, 2017. The note is included in Unsecured line of credit (senior) in the table at the start of this note. We have four other unsecured notes, which are listed in the first two tables of this Note 6. The interest rates and priorities vary. We recorded $30 and $6 in interest related to these four notes for the six months ended June 30, 2017 and 2016, respectively. Unsecured Notes through the Public Offering (Notes Program) The effective interest rate on the Notes offered pursuant to our public offering at June 30, 2017 and December 31, 2016 was 8.58% and 8.26%, respectively, not including the amortization of deferred financing costs. There are limited rights of early redemption. We generally offer four durations at any given time, ranging anywhere from 12 to 48 months. The following table shows the roll forward of our Notes program: Six Months Ended June 30, 2017 Year Ended Six Months Ended June 30, 2016 Gross notes outstanding, beginning of period $ 11,221 $ 8,496 $ 8,496 Notes issued 8,105 4,972 2,255 Note repayments / redemptions (5,087 ) (2,247 ) (59 ) Gross notes outstanding, end of period $ 14,239 $ 11,221 $ 10,692 Less deferred financing costs, net 330 411 493 Notes outstanding, net $ 13,909 $ 10,810 $ 10,199 The following is a roll forward of deferred financing costs: Six Months Year Six Months Ended Ended Ended June 30, 2017 December 31, 2016 June 30, 2016 Deferred financing costs, beginning balance $ 1,014 $ 935 $ 935 Additions 40 79 28 Deferred financing costs, ending balance $ 1,054 $ 1,014 $ 963 Less accumulated amortization (724 ) (603 ) (470 ) Deferred financing costs, net $ 330 $ 411 $ 493 The following is a roll forward of the accumulated amortization of deferred financing costs: Six Months Year Six Months Ended Ended Ended June 30, 2017 December 31, 2016 June 30, 2016 Accumulated amortization, beginning balance $ 603 $ 336 $ 336 Additions 121 267 134 Accumulated amortization, ending balance $ 724 $ 603 $ 470 |
Redeemable Preferred Equity
Redeemable Preferred Equity | 6 Months Ended |
Jun. 30, 2017 | |
Equity [Abstract] | |
Redeemable Preferred Equity | 7. Redeemable Preferred Equity Series C cumulative preferred units (“Series C Preferred Units”) were issued to Margaret Rauscher IRA LLC (Margaret Rauscher is the wife of one of our independent managers, Eric A. Rauscher) in March 2017, and to an IRA owned by William Myrick, another one of our independent managers, in April 2017. They are redeemable by the Company at any time, upon a change of control or liquidation, or by the investor any time after 6 years from the initial date of purchase. The Series C Preferred Units have a fixed value which is their purchase price, and preferred liquidation and distribution rights. Yearly distributions of 12% of the Series C Preferred Units’ value (provided profits are available) will be made quarterly. This rate can increase if any interest rate on our Note Program rises above 12%. Dividends can be reinvested monthly into additional Series C Preferred Units. Roll forward of redeemable preferred equity: Six Months Ended Year Ended Six Months Ended Beginning balance $ – $ – $ – Additions from new investment 1,004 $ – $ – Additions from reinvestment 29 – – Ending balance $ 1,033 $ – $ – The following table shows the earliest redemption options for investors in Series C Preferred Units as of June 30, 2017. Year Maturing Total Amount Redeemable 2023 $ 1,033 Total $ 1,033 |
Members' Capital
Members' Capital | 6 Months Ended |
Jun. 30, 2017 | |
Equity [Abstract] | |
Members' Capital | 8. Members’ Capital There are currently two classes of units outstanding: Class A common units and Series B cumulative preferred units (“Series B Preferred Units”). The Class A common units are held by eight members, all of whom have no personal liability. All Class A common members have voting rights in proportion to their capital account. There were 2,629 Class A common units outstanding at both June 30, 2017 and December 31, 2016. On December 31, 2015, an affiliate of 7Kings, S.K. Funding, purchased 4% of our common equity from the Wallach family. In March 2017, S.K. Funding sold its 4% interest in our common equity in equal 1% portions to each of our three independent managers and our Executive Vice President of Operations. The Series B Preferred Units were issued to the Hoskins Group through a reduction in a loan issued by the Hoskins Group to the Company. The Series B Preferred Units are redeemable only at the option of the Company or upon a change or control or liquidation. Ten Series B Preferred Units were initially issued for a total of $1,000. The Series B Preferred Units have a fixed value which is their purchase price, and preferred liquidation and distribution rights. Yearly distributions of 10% of the Series B Preferred Units’ value (provided profits are available) will be made quarterly. The Hoskins Group’s Series B Preferred Units are also used as collateral for that group’s loans to the Company. There is no liquid market for the Series B Preferred Units, so we can give no assurance as to our ability to generate any amount of proceeds from that collateral. In December 2015, the Hoskins Group agreed to purchase 0.1 Series B Preferred Units for $10 at each closing of a lot to a third party in the Hamlets and Tuscany subdivision. As of June 30, 2017, the Hoskins Group owns a total of 11.6 Series B Preferred Units, which were issued for a total of $1,160. There are two additional authorized unit classes, of which no units are outstanding: Class A preferred units and Class B profit units. Once Class B profit units are issued, the existing Class A common units will become Class A preferred units. Class A preferred units will receive preferred treatment in terms of distributions and liquidation proceeds. The members’ capital balances by class are as follows: Class or Series June 30, 2017 December 31, 2016 Series B Preferred Units $ 1,160 $ 1,150 Class A Common Units 2,398 2,249 Members’ Capital $ 3,558 $ 3,399 |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 9. Related Party Transactions The Company has a loan agreement with two of our affiliates, as more fully described in Note 6 – Affiliate Loans. The Company has loan agreements with the Hoskins Group, as more fully described in Note 3. The Hoskins Group has a preferred equity interest in the Company, as more fully described in Note 8. An IRA owned by the wife of Eric A. Rauscher, one of our independent managers, and an IRA owned by William Myrick, also one of our independent managers, each own Series C Preferred Units, as more fully described in Note 7. Each of our three independent managers and our Executive Vice President of Operations own 1% of our Class A common units. The Company has accepted new investments under the Notes program from employees, managers, members and relatives of managers and members, with $1,701 and $2,810 outstanding at June 30,2017 and June 30, 2016, respectively. The larger of these investments are detailed below: Relationship to Amount invested as of Weighted interest Rate as of Interest earned during the Shepherd’s June 30 December 31 June 30, June 30, Investor Finance 2017 2016 2017 2017 2016 David Wallach Parent of Independent Manager 211 111 9.42 % 6 5 R. Scott Summers Son of Independent Manager 275 75 8.00 % 8 12 Wallach Family Irrevocable Educational Trust Trustee is Member 200 200 9.00 % 9 8 Eric A. Rauscher Independent Manager 475 600 10.00 % 21 22 Joseph Rauscher Parent of Independent Manager 195 186 9.33 % 9 8 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 10. Commitments and Contingencies In the normal course of business there may be outstanding commitments to extend credit that are not included in the consolidated financial statements. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon and some of the funding may come from the earlier repayment of the same loan (in the case of revolving lines), the total commitment amounts do not necessarily represent future cash requirements. The financial instruments involve, to varying degrees, elements of credit and interest rate risk in excess of amounts recognized in the consolidated financial statements. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The Company has several Letters of Credit relating to development loans which are part of the unfunded commitment amount. Unfunded commitments to extend credit, which have similar collateral, credit risk and market risk to our outstanding loans, were $17,797 and $11,503 at June 30, 2017 and December 31, 2016, respectively. The Company plans to fund its new loan growth, unfunded commitment, and principal amounts due on its debt using various sources of funding. In July 2017, we sold a participating interest in the Pennsylvania Loans for $3,000 (see note 13), and became the borrower on a secured line of credit for $1,325. The combined $4,325 added to our liquidity. We sell 70% participating interests in most of the loans we create. The portions of loans sold already that has not been funded is $3,356. There are loans that we have designated for sale which, at 70% funding, will eventually provide $4,442 in liquidity, and there are loans we have not designated for sale, which, if sold at 70% funding, would eventually provide $3,387 in liquidity. In addition, the Company receives payoffs on loans, a portion of which is returned to the loan purchaser, if any. Also, the Company receives funds from new public offering sales, and many of the Notes which mature are renewed, reducing the funding needed. |
Selected Quarterly Condensed Co
Selected Quarterly Condensed Consolidated Financial Data (Unaudited) | 6 Months Ended |
Jun. 30, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Condensed Consolidated Financial Data (Unaudited) | 11. Selected Quarterly Condensed Consolidated Financial Data (Unaudited) Summarized unaudited quarterly condensed consolidated financial data for the four quarters of 2017 and 2016 are as follows (in thousands): Quarter 4 Quarter 3 Quarter 2 Quarter 1 Quarter 4 Quarter 3 Quarter 2 Quarter 1 2017 2017 2017 2017 2016 2016 2016 2016 Net Interest Income after Loan Loss Provision $ – $ – $ 725 $ 617 $ 491 $ 442 $ 464 $ 479 Non-Interest Income – – – 77 28 – 44 – SG&A expense – – 456 454 367 297 305 350 Impairment loss on foreclosed assets – – 106 49 111 – – – Net Income $ – $ – $ 163 $ 191 $ 41 $ 145 $ 203 $ 129 |
Non-Interest Expense Detail
Non-Interest Expense Detail | 6 Months Ended |
Jun. 30, 2017 | |
Non-interest Expense Detail | |
Non-Interest Expense Detail | 12. Non-Interest expense detail The following table displays our selling, general and administrative (“SG&A”) expenses: For the Six Months Ended June 30, 2017 2016 Selling, general and administrative expenses Legal and accounting $ 125 $ 112 Salaries and related expenses 583 385 Board related expenses 55 55 Advertising 25 25 Rent and utilities 14 10 Loan and foreclosed asset expenses 26 17 Travel 32 19 Other 50 32 Total SG&A $ 910 $ 655 |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | 13. Subsequent Events On July 24, 2017, we entered into the Sixth Amendment (the “Sixth Amendment”) to our Loan Purchase and Sale Agreement (the “Agreement”) with S.K. Funding, LLC (the “S.K. Funding”). The Agreement was originally entered into between the Company and Seven Kings Holdings, Inc. (“7Kings”). However, on or about May 7, 2015, 7Kings assigned its right and interest in the Agreement to S.K. Funding. The purpose of the Sixth Amendment was to allow S.K. Funding to purchase portions of the Pennsylvania Loans for a purchase price of $3,000 under parameters different from those specified in the Agreement. The Pennsylvania Loans purchased pursuant to the Sixth Amendment consist of a portion of the Hoskins Group loans. We will continue to service the Loans. The timing of the Company’s principal and interest payments to S.K. Funding under the Sixth Amendment, and S.K. Funding’s obligation to fund the Pennsylvania Loans, vary depending on the total principal amount of the Pennsylvania Loans outstanding at any time. The Pennsylvania Loans had a principal amount in excess of $4,000 as of the effective date of the Sixth Amendment. While the total principal amount of the Pennsylvania Loans exceeds $1,000, S.K. Funding must fund (by paying the Company) the amount by which the total principal amount of the Pennsylvania Loans exceeds $1,000, with such total amount funded not exceeding $3,000. The interest rate accruing to S.K. Funding under the Sixth Amendment is 10.5% calculated on a 365/366 day basis. When the total principal amount of the Pennsylvania Loans is less than $4,000, the Company will also repay S.K. Funding’s principal as principal payments are received on the Pennsylvania Loans from the underlying borrowers in the amount by which the total principal amount of the Pennsylvania Loans is less than $4,000 until S.K. Funding’s principal has been repaid in full. S.K. Funding will continue to be obligated, as described in this paragraph, to fund (by paying the Company) the Pennsylvania Loans for any increases in the outstanding balance of the Pennsylvania Loans up to no more than a total outstanding amount of $4,000. The Sixth Amendment has a term of 24 months from the effective date and will automatically renew for additional six month terms unless either party gives written notice of its intent not to renew the Sixth Amendment at least six months prior to the end of a term. Further, no Protective Advances (as such term is defined in the Agreement) will be required with respect to the Pennsylvania Loans. S.K. Funding will have a priority position as compared to the Company in the case of a default by any of the borrowers. |
Fair Value (Tables)
Fair Value (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Non-financial Instruments Measured at Fair Value on Non-recurring Basis | The following tables present the balances of non-financial instruments measured at fair value on a non-recurring basis as of June 30, 2017 and December 31, 2016. June 30, 2017 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Estimated Assets Inputs Inputs Amount Fair Value Level 1 Level 2 Level 3 Foreclosed assets $ 1,095 $ 1,095 $ – $ – $ 1,095 Impaired loans $ 1,980 $ 1,980 $ – $ – $ 1,980 December 31, 2016 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Estimated Assets Inputs Inputs Amount Fair Value Level 1 Level 2 Level 3 Foreclosed assets $ 2,798 $ 2,798 $ – $ – $ 2,798 |
Schedule of Fair Value Measurements, Recurring and Nonrecurring | The table below is a summary of fair value estimates for financial instruments and the level of the fair value hierarchy (as discussed in Note 2) within which the fair value measurements are categorized at the periods indicated: June 30, 2017 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Estimated Assets Inputs Inputs Amount Fair Value Level 1 Level 2 Level 3 Financial Assets Cash and cash equivalents $ 88 $ 88 $ 88 $ – $ – Loans receivable, net 28,972 28,972 – – 28,972 Accrued interest receivable 354 354 – – 354 Financial Liabilities Customer interest escrow 829 829 – – 829 Notes payable secured 8,820 8,820 – – 8,820 Notes payable unsecured, net 15,574 15,574 – – 15,574 Accrued interest payable 996 996 – – 996 December 31, 2016 Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Carrying Estimated Assets Inputs Inputs Amount Fair Value Level 1 Level 2 Level 3 Financial Assets Cash and cash equivalents $ 1,566 $ 1,566 $ 1,566 $ – $ – Loans receivable, net 20,091 20,091 – – 20,091 Accrued interest receivable 280 280 – – 280 Financial Liabilities Customer interest escrow 812 812 – – 812 Notes payable secured 7,322 7,322 – – 7,322 Notes payable unsecured, net 11,962 11,962 – – 11,962 Accrued interest payable 993 993 – – 993 |
Financing Receivables (Tables)
Financing Receivables (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Receivables [Abstract] | |
Schedule of Financing Receivables | Financing receivables are comprised of the following as of June 30, 2017 and December 31, 2016: June 30, 2017 December 31, 2016 Loans receivable, gross $ 31,421 $ 21,569 Less: Deferred loan fees (872 ) (618 ) Less: Deposits (1,623 ) (861 ) Plus: Deferred origination expense 126 55 Less: Allowance for loan losses (80 ) (54 ) Loans receivable, net $ 28,972 $ 20,091 |
Schedule of Roll Forward of Commercial Loans | Roll forward of loans receivable, net: Six Months Ended Year Ended Six Months Ended Beginning balance $ 20,091 $ 14,060 $ 14,060 Additions 16,081 23,184 10,692 Payoffs/sales (6,229 ) (15,168 ) (6,594 ) Moved to foreclosed assets – (1,639 ) (1,639 ) Change in deferred origination expense 71 55 30 Change in builder deposit (762 ) (340 ) (41 ) Change in loan loss provision (26 ) (16 ) (6 ) New loan fees (1,153 ) (1,270 ) (540 ) Earned loan fees 899 1,225 633 Ending balance $ 28,972 $ 20,091 $ 16,595 |
Commercial Loans - Real Estate Development Loan Portfolio Summary | The following is a summary of our loan portfolio to builders for land development as of June 30, 2017. The Pennsylvania loans below are the Pennsylvania Loans discussed above. State Number of Borrowers Number of Loans Value of Collateral (1) Commitment Amount Gross Amount Outstanding Loan to Value Ratio (2) Loan Fee Pennsylvania 1 3 $ 6,298 $ 5,231 (3) $ 4,050 64 % $ 1,000 Total 1 3 $ 6,298 $ 5,231 $ 4,050 64 % $ 1,000 (1) The value is determined by the appraised value adjusted for remaining costs to be paid and third party mortgage balances. Part of this collateral is $1,160 of preferred equity in our Company. In the event of a foreclosure on the property securing certain of our loans, a portion of our collateral is preferred equity in our Company, which might be difficult to sell, which could impact our ability to eliminate the loan balance. (2) The loan to value ratio is calculated by taking the outstanding amount and dividing by the appraised value. (3) The commitment amount does not include letters of credit and cash bonds, as the sum of the total balance outstanding including the cash bonds plus the letters of credit and remaining to fund for construction is less than the $5,231 commitment amount. The following is a summary of our loan portfolio to builders for land development as of December 31, 2016. The Pennsylvania loans below are the Pennsylvania Loans discussed above. State Number of Borrowers Number of Loans Value of Collateral (1) Commitment Amount Gross Amount Outstanding Loan to Value Ratio (2) Loan Fee Pennsylvania 1 3 $ 6,586 $ 5,931 (3) $ 4,082 62 % $ 1,000 Total 1 3 $ 6,586 $ 5,931 $ 4,082 62 % $ 1,000 (1) The value is determined by the appraised value adjusted for remaining costs to be paid and third party mortgage balances. Part of this collateral is $1,150 of preferred equity in our Company. In the event of a foreclosure on the property securing certain of our loans, a portion of our collateral is preferred equity in our Company, which might be difficult to sell, which could impact our ability to eliminate the loan balance. (2) The loan to value ratio is calculated by taking the outstanding amount and dividing by the appraised value. (3) The commitment amount does not include letters of credit and cash bonds, as the sum of the total balance outstanding including the cash bonds plus the letters of credit and remaining to fund for construction is less than the $5,931 commitment amount. |
Commercial Loans - Construction Loan Portfolio Summary | The following is a summary of our loan portfolio to builders for home construction loans as of June 30, 2017. State Number of Borrowers Number of Loans Value of Collateral (1) Commitment Amount Gross Amount Outstanding Loan to Value Ratio (2) Loan Fee Colorado 3 6 $ 3,113 $ 2,092 $ 1,082 67 % 5 % Connecticut 1 1 715 500 500 70 % 5 % Delaware 1 1 244 171 115 70 % 5 % Florida 11 42 21,930 13,904 8,110 63 % 5 % Georgia 9 22 13,958 8,405 4,991 60 % 5 % Indiana 2 2 995 597 178 60 % 5 % Michigan 3 13 3,254 2,065 1,139 63 % 5 % New Jersey 3 8 2,361 1,652 1,098 70 % 5 % New York 1 7 2,160 1,064 984 49 % 5 % North Carolina 2 7 1,740 1,218 543 70 % 5 % Ohio 2 2 2,116 1,340 777 63 % 5 % Pennsylvania 2 15 12,595 6,407 5,244 51 % 5 % South Carolina 8 14 4,071 2,699 1,350 66 % 5 % Tennessee 1 3 1,080 767 711 71 % 5 % Utah 1 3 1,208 846 353 70 % 5 % Virginia 1 1 408 260 196 64 % 5 % Total 50 (4) 147 $ 71,948 $ 43,987 $ 27,371 61 % (3) 5 % (1) The value is determined by the appraised value. (2) The loan to value ratio is calculated by taking the commitment amount and dividing by the appraised value. (3) Represents the weighted average loan to value ratio of the loans. (4) One builder borrows in multiple states. The following is a summary of our loan portfolio to builders for home construction loans as of December 31, 2016. State Number of Borrowers Number of Loans Value of Collateral (1) Commitment Amount Gross Amount Outstanding Loan to Value Ratio (2) Loan Fee Colorado 1 3 $ 1,615 $ 1,131 $ 605 70 % 5 % Connecticut 1 1 715 500 479 70 % 5 % Delaware 1 2 244 171 40 70 % 5 % Florida 7 15 14,014 8,548 4,672 61 % 5 % Georgia 4 9 6,864 4,249 2,749 62 % 5 % Idaho 1 1 319 215 205 67 % 5 % Michigan 1 1 210 126 118 60 % 5 % New Jersey 1 3 977 719 528 74 % 5 % New York 1 4 1,745 737 685 42 % 5 % North Carolina 2 2 1,015 633 216 62 % 5 % Ohio 1 1 1,405 843 444 60 % 5 % Pennsylvania 2 15 12,725 6,411 5,281 50 % 5 % South Carolina 5 7 2,544 1,591 783 63 % 5 % Tennessee 1 3 1,080 767 430 71 % 5 % Utah 1 2 715 500 252 70 % 5 % Total 30 69 $ 46,187 $ 27,141 $ 17,487 59 % (3) 5 % (1) The value is determined by the appraised value. (2) The loan to value ratio is calculated by taking the commitment amount and dividing by the appraised value. (3) Represents the weighted average loan to value ratio of the loans. |
Summary of Finance Receivables by Classification | Gross finance Receivables – By risk rating: June 30, 2017 December 31, 2016 Pass $ 25,791 $ 18,275 Special mention 3,643 3,294 Classified – accruing – – Classified – nonaccrual 1,987 – Total $ 31,421 $ 21,569 |
Schedule of Impairment Calculation Method | Gross finance Receivables – Method of impairment calculation: June 30, 2017 December 31, 2016 Performing loans evaluated individually $ 8,978 $ 12,424 Performing loans evaluated collectively 20,456 9,145 Non-performing loans without a specific reserve – – Non-performing loans with a specific reserve 1,987 – Total $ 31,421 $ 21,569 |
Schedule of Impaired Loans | The following is a summary of our impaired nonaccrual commercial construction loans as of June 30, 2017 and December 31, 2016. All loans listed have a related allowance for loan losses. June 30, 2017 December 31, 2016 Unpaid principal balance (contractual obligation from customer) $ 1,987 $ – Charge-offs and payments applied – – Gross value before related allowance 1,987 – Related allowance 7 – Value after allowance $ 1,980 $ – |
Schedule of Concentration Risk for Individual Borrowers | Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of loans receivable. Our concentration risks for individual borrowers are summarized in the table below: June 30, 2017 December 31, 2016 Percent of Percent of Borrower Loan Borrower Loan City Commitments City Commitments Highest concentration risk Pittsburgh, PA 23 % Pittsburgh, PA 37 % Second highest concentration risk Sarasota, FL 7 % Sarasota, FL 11 % Third highest concentration risk Orlando, FL 5 % Savannah, GA 6 % |
Foreclosed Assets (Tables)
Foreclosed Assets (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Roll Forward of Foreclosed Assets | Roll forward of Foreclosed Assets: Six Months Ended Year Ended Six Months Ended Beginning balance $ 2,798 $ 965 $ 965 Additions from loans – 1,813 1,813 Additions for construction/development 265 566 375 Sale proceeds (1,890 ) (463 ) – Gain on sale 77 28 – Impairment loss on foreclosed assets (155 ) (111 ) – Ending balance $ 1,095 $ 2,798 $ 3,153 |
Borrowings (Tables)
Borrowings (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Borrowings | The following table displays our borrowings and a ranking of priority: Priority Rank June 30, 2017 December 31, 2016 Borrowing Source Purchase and sale agreements 1 $ 8,820 $ 7,322 Secured line of credit from affiliates 2 – – Unsecured line of credit (senior) 3 500 – Other unsecured debt (senior subordinated) 4 279 279 Unsecured Notes through our public offering, gross 5 14,239 11,221 Other unsecured debt (subordinated) 5 713 700 Other unsecured debt (junior subordinated) 6 173 173 Total $ 24,724 $ 19,695 |
Schedule of Maturities of Long-term Debt | The following table shows the maturity of outstanding debt as of June 30, 2017. Year Maturing Total Amount Maturing Public Offering Other Unsecured Purchase and Sale Agreements 2017 $ 9,693 $ 373 $ 500 $ 8,820 2018 5,133 4,633 500 – 2019 3,569 3,456 113 – 2020 1,943 1,943 – – 2021 4,386 3,834 552 – Total $ 24,724 $ 14,239 $ 1,665 $ 8,820 |
Schedule of Purchase and Sale Agreements | The purchase and sale agreements are detailed below: June 30, 2017 December 31, 2016 Book Value of Due From Book Value of Due From Loans which Shepherd’s Loans which Shepherd’s Served as Finance to Loan Served as Finance to Loan Collateral Purchaser Collateral Purchaser Loan purchaser 1st Financial Bank, USA/Builder Finance, Inc. $ 9,507 $ 5,207 $ 5,779 $ 2,517 S.K. Funding, LLC 8,523 3,613 7,770 4,805 Total $ 18,030 $ 8,820 $ 13,549 $ 7,322 |
Schedule of Roll Forward of Notes Outstanding | The following table shows the roll forward of our Notes program: Six Months Ended June 30, 2017 Year Ended Six Months Ended June 30, 2016 Gross notes outstanding, beginning of period $ 11,221 $ 8,496 $ 8,496 Notes issued 8,105 4,972 2,255 Note repayments / redemptions (5,087 ) (2,247 ) (59 ) Gross notes outstanding, end of period $ 14,239 $ 11,221 $ 10,692 Less deferred financing costs, net 330 411 493 Notes outstanding, net $ 13,909 $ 10,810 $ 10,199 |
Schedule of Roll Forward of Deferred Financing Cost | The following is a roll forward of deferred financing costs: Six Months Year Six Months Ended Ended Ended June 30, 2017 December 31, 2016 June 30, 2016 Deferred financing costs, beginning balance $ 1,014 $ 935 $ 935 Additions 40 79 28 Deferred financing costs, ending balance $ 1,054 $ 1,014 $ 963 Less accumulated amortization (724 ) (603 ) (470 ) Deferred financing costs, net $ 330 $ 411 $ 493 |
Schedule of Roll Forward of Accumulated Amortization of Deferred Financing Costs | The following is a roll forward of the accumulated amortization of deferred financing costs: Six Months Year Six Months Ended Ended Ended June 30, 2017 December 31, 2016 June 30, 2016 Accumulated amortization, beginning balance $ 603 $ 336 $ 336 Additions 121 267 134 Accumulated amortization, ending balance $ 724 $ 603 $ 470 |
Redeemable Preferred Equity (Ta
Redeemable Preferred Equity (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Equity [Abstract] | |
Schedule of Roll Forward of Redeemable Preferred Equity | Roll forward of redeemable preferred equity: Six Months Ended Year Ended Six Months Ended Beginning balance $ – $ – $ – Additions from new investment 1,004 $ – $ – Additions from reinvestment 29 – – Ending balance $ 1,033 $ – $ – |
Schedule of Redemption Option for Investors | The following table shows the earliest redemption options for investors in Series C Preferred Units as of June 30, 2017. Year Maturing Total Amount Redeemable 2023 $ 1,033 Total $ 1,033 |
Members' Capital (Tables)
Members' Capital (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Equity [Abstract] | |
Schedule of Capital Units | The members’ capital balances by class are as follows: Class or Series June 30, 2017 December 31, 2016 Series B Preferred Units $ 1,160 $ 1,150 Class A Common Units 2,398 2,249 Members’ Capital $ 3,558 $ 3,399 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | The larger of these investments are detailed below: Relationship to Amount invested as of Weighted interest Rate as of Interest earned during the Shepherd’s June 30 December 31 June 30, June 30, Investor Finance 2017 2016 2017 2017 2016 David Wallach Parent of Independent Manager 211 111 9.42 % 6 5 R. Scott Summers Son of Independent Manager 275 75 8.00 % 8 12 Wallach Family Irrevocable Educational Trust Trustee is Member 200 200 9.00 % 9 8 Eric A. Rauscher Independent Manager 475 600 10.00 % 21 22 Joseph Rauscher Parent of Independent Manager 195 186 9.33 % 9 8 |
Selected Quarterly Condensed 26
Selected Quarterly Condensed Consolidated Financial Data (Unaudited) (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summarized Unaudited Quarterly Condensed Consolidated Financial Data | Summarized unaudited quarterly condensed consolidated financial data for the four quarters of 2017 and 2016 are as follows (in thousands): Quarter 4 Quarter 3 Quarter 2 Quarter 1 Quarter 4 Quarter 3 Quarter 2 Quarter 1 2017 2017 2017 2017 2016 2016 2016 2016 Net Interest Income after Loan Loss Provision $ – $ – $ 725 $ 617 $ 491 $ 442 $ 464 $ 479 Non-Interest Income – – – 77 28 – 44 – SG&A expense – – 456 454 367 297 305 350 Impairment loss on foreclosed assets – – 106 49 111 – – – Net Income $ – $ – $ 163 $ 191 $ 41 $ 145 $ 203 $ 129 |
Non-Interest Expense Detail (Ta
Non-Interest Expense Detail (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Non-interest Expense Detail | |
Schedule of Selling General and Administrative Expenses | The following table displays our selling, general and administrative (“SG&A”) expenses: For the Six Months Ended June 30, 2017 2016 Selling, general and administrative expenses Legal and accounting $ 125 $ 112 Salaries and related expenses 583 385 Board related expenses 55 55 Advertising 25 25 Rent and utilities 14 10 Loan and foreclosed asset expenses 26 17 Travel 32 19 Other 50 32 Total SG&A $ 910 $ 655 |
Fair Value (Details Narrative)
Fair Value (Details Narrative) | 6 Months Ended |
Jun. 30, 2017 | |
Minimum [Member] | |
Estimated costs associated with asset disposal, percentage | 0.00% |
Maximum [Member] | |
Estimated costs associated with asset disposal, percentage | 5.00% |
Fair Value - Schedule of Non-fi
Fair Value - Schedule of Non-financial Instruments Measured at Fair Value on Non-recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 |
Foreclosed assets | $ 1,095 | $ 2,798 | $ 3,153 | $ 965 |
Carrying Amount [Member] | ||||
Foreclosed assets | 1,095 | 2,798 | ||
Impaired loans | 1,980 | |||
Estimated Fair Value [Member] | ||||
Foreclosed assets | 1,095 | 2,798 | ||
Impaired loans | 1,980 | |||
Fair Value, Inputs, Level 1 [Member] | ||||
Foreclosed assets | ||||
Impaired loans | ||||
Fair Value, Inputs, Level 2 [Member] | ||||
Foreclosed assets | ||||
Impaired loans | ||||
Fair Value, Inputs, Level 3 [Member] | ||||
Foreclosed assets | 1,095 | $ 2,798 | ||
Impaired loans | $ 1,980 |
Fair Value - Schedule of Fair V
Fair Value - Schedule of Fair Value Measurements, Recurring and Nonrecurring (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 |
Financial Assets, Cash and cash equivalents | $ 88 | $ 1,566 | $ 1,032 | $ 1,341 |
Financial Assets, Loans receivable, net | 28,972 | 20,091 | 16,595 | 14,060 |
Financial Liabilities, Customer interest escrow | 829 | 812 | ||
Financial Liabilities, Notes payable unsecured, net | 14,239 | 11,221 | $ 10,692 | $ 8,496 |
Carrying Amount [Member] | ||||
Financial Assets, Cash and cash equivalents | 88 | 1,566 | ||
Financial Assets, Loans receivable, net | 28,972 | 20,091 | ||
Financial Assets, Accrued interest receivable | 354 | 280 | ||
Financial Liabilities, Customer interest escrow | 829 | 812 | ||
Financial Liabilities, Notes payable secured | 8,820 | 7,322 | ||
Financial Liabilities, Notes payable unsecured, net | 15,574 | 11,962 | ||
Financial Liabilities, Accrued interest payable | 996 | 993 | ||
Estimated Fair Value [Member] | ||||
Financial Assets, Cash and cash equivalents | 88 | 1,566 | ||
Financial Assets, Loans receivable, net | 28,972 | 20,091 | ||
Financial Assets, Accrued interest receivable | 354 | 280 | ||
Financial Liabilities, Customer interest escrow | 829 | 812 | ||
Financial Liabilities, Notes payable secured | 8,820 | 7,322 | ||
Financial Liabilities, Notes payable unsecured, net | 15,574 | 11,962 | ||
Financial Liabilities, Accrued interest payable | 996 | 993 | ||
Fair Value, Inputs, Level 1 [Member] | ||||
Financial Assets, Cash and cash equivalents | 88 | 1,566 | ||
Financial Assets, Loans receivable, net | ||||
Financial Assets, Accrued interest receivable | ||||
Financial Liabilities, Customer interest escrow | ||||
Financial Liabilities, Notes payable secured | ||||
Financial Liabilities, Notes payable unsecured, net | ||||
Financial Liabilities, Accrued interest payable | ||||
Fair Value, Inputs, Level 2 [Member] | ||||
Financial Assets, Cash and cash equivalents | ||||
Financial Assets, Loans receivable, net | ||||
Financial Assets, Accrued interest receivable | ||||
Financial Liabilities, Customer interest escrow | ||||
Financial Liabilities, Notes payable secured | ||||
Financial Liabilities, Notes payable unsecured, net | ||||
Financial Liabilities, Accrued interest payable | ||||
Fair Value, Inputs, Level 3 [Member] | ||||
Financial Assets, Cash and cash equivalents | ||||
Financial Assets, Loans receivable, net | 28,972 | 20,091 | ||
Financial Assets, Accrued interest receivable | 354 | 280 | ||
Financial Liabilities, Customer interest escrow | 829 | 812 | ||
Financial Liabilities, Notes payable secured | 8,820 | 7,322 | ||
Financial Liabilities, Notes payable unsecured, net | 15,574 | 11,962 | ||
Financial Liabilities, Accrued interest payable | $ 996 | $ 993 |
Financing Receivables (Details
Financing Receivables (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Total commitment amount | $ 5,231 | $ 5,931 |
Pennsylvania Loans [Member] | ||
Total commitment amount | $ 5,231 | |
Invest in preferred equity, per closing of a lot payoff | $ 10 |
Financing Receivables - Schedul
Financing Receivables - Schedule of Financing Receivables (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 |
Receivables [Abstract] | ||||
Loans receivable, gross | $ 31,421 | $ 21,569 | ||
Less: Deferred loan fees | (872) | (618) | ||
Less: Deposits | (1,623) | (861) | ||
Plus: Deferred origination expense | 126 | 55 | ||
Less: Allowance for loan losses | (80) | (54) | ||
Loans receivable, net | $ 28,972 | $ 20,091 | $ 16,595 | $ 14,060 |
Financing Receivables - Sched33
Financing Receivables - Schedule of Roll Forward of Commercial Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Receivables [Abstract] | |||||
Beginning balance | $ 20,091 | $ 14,060 | $ 14,060 | ||
Additions | 16,081 | 10,692 | 23,184 | ||
Payoffs/sales | (6,229) | (6,594) | (15,168) | ||
Moved to foreclosed assets | (1,639) | (1,639) | |||
Change in deferred origination expense | 71 | 30 | 55 | ||
Change in builder deposit | (762) | (41) | (340) | ||
Change in loan loss provision | $ (15) | $ 2 | (26) | (6) | (16) |
New loan fees | (1,153) | (540) | (1,270) | ||
Earned loan fees | 899 | 633 | 1,225 | ||
Ending balance | $ 28,972 | $ 16,595 | $ 28,972 | $ 16,595 | $ 20,091 |
Financing Receivables - Commerc
Financing Receivables - Commercial Loans - Real Estate Development Loan Portfolio Summary (Details) $ in Thousands | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2017USD ($)Loan | Dec. 31, 2016USD ($)Loan | ||||
Real Estate Development Loan Portfolio [Line Items] | |||||
Commitment Amount | $ 5,231 | $ 5,931 | |||
Gross Amount Outstanding | $ 31,421 | $ 21,569 | |||
Pennsylvania [Member] | |||||
Real Estate Development Loan Portfolio [Line Items] | |||||
Number of Borrowers | Loan | 2 | 2 | |||
Number of Loans | Loan | 15 | 15 | |||
Value of Collateral | [1] | $ 12,595 | $ 12,725 | ||
Commitment Amount | 6,407 | 6,411 | |||
Gross Amount Outstanding | $ 5,244 | $ 5,281 | |||
Loan to Value Ratio | [2] | 51.00% | 50.00% | ||
Real Estate Development [Member] | |||||
Real Estate Development Loan Portfolio [Line Items] | |||||
Number of Borrowers | Loan | 1 | 1 | |||
Number of Loans | Loan | 3 | 3 | |||
Value of Collateral | $ 6,298 | [3] | $ 6,586 | [4] | |
Commitment Amount | 5,231 | 5,931 | |||
Gross Amount Outstanding | $ 4,050 | $ 4,082 | |||
Loan to Value Ratio | [5] | 64.00% | 62.00% | ||
Loan Fee | $ 1,000 | $ 1,000 | |||
Real Estate Development [Member] | Pennsylvania [Member] | |||||
Real Estate Development Loan Portfolio [Line Items] | |||||
Number of Borrowers | Loan | 1 | 1 | |||
Number of Loans | Loan | 3 | 3 | |||
Value of Collateral | $ 6,298 | [3] | $ 6,586 | [4] | |
Commitment Amount | 5,231 | [6] | 5,931 | [7] | |
Gross Amount Outstanding | $ 4,050 | $ 4,082 | |||
Loan to Value Ratio | [5] | 64.00% | 62.00% | ||
Loan Fee | $ 1,000 | $ 1,000 | |||
[1] | The value is determined by the appraised value. | ||||
[2] | The loan to value ratio is calculated by taking the commitment amount and dividing by the appraised value. | ||||
[3] | The value is determined by the appraised value adjusted for remaining costs to be paid and third party mortgage balances. Part of this collateral is $1,160 of preferred equity in our Company. In the event of a foreclosure on the property securing certain of our loans, a portion of our collateral is preferred equity in our Company, which might be difficult to sell, which could impact our ability to eliminate the loan balance. | ||||
[4] | The value is determined by the appraised value adjusted for remaining costs to be paid and third party mortgage balances. Part of this collateral is $1,150 of preferred equity in our Company. In the event of a foreclosure on the property securing certain of our loans, a portion of our collateral is preferred equity in our Company, which might be difficult to sell, which could impact our ability to eliminate the loan balance. | ||||
[5] | The loan to value ratio is calculated by taking the outstanding amount and dividing by the appraised value. | ||||
[6] | The commitment amount does not include letters of credit and cash bonds, as the sum of the total balance outstanding including the cash bonds plus the letters of credit and remaining to fund for construction is less than the $5,231 commitment amount. | ||||
[7] | The commitment amount does not include letters of credit and cash bonds, as the sum of the total balance outstanding including the cash bonds plus the letters of credit and remaining to fund for construction is less than the $5,931 commitment amount. |
Financing Receivables - Comme35
Financing Receivables - Commercial Loans - Real Estate Development Loan Portfolio Summary (Details) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | ||
Collateral of preferred equity | $ 1,160 | $ 1,150 |
Commitment amount | $ 5,231 | $ 5,931 |
Financing Receivables - Comme36
Financing Receivables - Commercial Loans - Construction Loan Portfolio Summary (Details) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017USD ($)Loan | Dec. 31, 2016USD ($)Loan | |||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Commitment Amount | $ 5,231 | $ 5,931 | ||
Gross Amount Outstanding | $ 31,421 | $ 21,569 | ||
Colorado [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 3 | 1 | ||
Number of Loans | Loan | 6 | 3 | ||
Value of Collateral | [1] | $ 3,113 | $ 1,615 | |
Commitment Amount | 2,092 | 1,131 | ||
Gross Amount Outstanding | $ 1,082 | $ 605 | ||
Loan to Value Ratio | [2] | 67.00% | 70.00% | |
Loan Fee | 5.00% | 5.00% | ||
Connecticut [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 1 | 1 | ||
Number of Loans | Loan | 1 | 1 | ||
Value of Collateral | [1] | $ 715 | $ 715 | |
Commitment Amount | 500 | 500 | ||
Gross Amount Outstanding | $ 500 | $ 479 | ||
Loan to Value Ratio | [2] | 70.00% | 70.00% | |
Loan Fee | 5.00% | 5.00% | ||
Delaware [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 1 | 1 | ||
Number of Loans | Loan | 1 | 2 | ||
Value of Collateral | [1] | $ 244 | $ 244 | |
Commitment Amount | 171 | 171 | ||
Gross Amount Outstanding | $ 115 | $ 40 | ||
Loan to Value Ratio | [2] | 70.00% | 70.00% | |
Loan Fee | 5.00% | 5.00% | ||
Florida [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 11 | 7 | ||
Number of Loans | Loan | 42 | 15 | ||
Value of Collateral | [1] | $ 21,930 | $ 14,014 | |
Commitment Amount | 13,904 | 8,548 | ||
Gross Amount Outstanding | $ 8,110 | $ 4,672 | ||
Loan to Value Ratio | [2] | 63.00% | 61.00% | |
Loan Fee | 5.00% | 5.00% | ||
Georgia [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 9 | 4 | ||
Number of Loans | Loan | 22 | 9 | ||
Value of Collateral | [1] | $ 13,958 | $ 6,864 | |
Commitment Amount | 8,405 | 4,249 | ||
Gross Amount Outstanding | $ 4,991 | $ 2,749 | ||
Loan to Value Ratio | [2] | 60.00% | 62.00% | |
Loan Fee | 5.00% | 5.00% | ||
Indiana [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 2 | |||
Number of Loans | Loan | 2 | |||
Value of Collateral | [1] | $ 995 | ||
Commitment Amount | 597 | |||
Gross Amount Outstanding | $ 178 | |||
Loan to Value Ratio | [2] | 60.00% | ||
Loan Fee | 5.00% | |||
Michigan [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 3 | 1 | ||
Number of Loans | Loan | 13 | 1 | ||
Value of Collateral | [1] | $ 3,254 | $ 210 | |
Commitment Amount | 2,065 | 126 | ||
Gross Amount Outstanding | $ 1,139 | $ 118 | ||
Loan to Value Ratio | [2] | 63.00% | 60.00% | |
Loan Fee | 5.00% | 5.00% | ||
New Jersey [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 3 | 1 | ||
Number of Loans | Loan | 8 | 3 | ||
Value of Collateral | [1] | $ 2,361 | $ 977 | |
Commitment Amount | 1,652 | 719 | ||
Gross Amount Outstanding | $ 1,098 | $ 528 | ||
Loan to Value Ratio | [2] | 70.00% | 74.00% | |
Loan Fee | 5.00% | 5.00% | ||
New York [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 1 | 1 | ||
Number of Loans | Loan | 7 | 4 | ||
Value of Collateral | [1] | $ 2,160 | $ 1,745 | |
Commitment Amount | 1,064 | 737 | ||
Gross Amount Outstanding | $ 984 | $ 685 | ||
Loan to Value Ratio | [2] | 49.00% | 42.00% | |
Loan Fee | 5.00% | 5.00% | ||
North Carolina [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 2 | 2 | ||
Number of Loans | Loan | 7 | 2 | ||
Value of Collateral | [1] | $ 1,740 | $ 1,015 | |
Commitment Amount | 1,218 | 633 | ||
Gross Amount Outstanding | $ 543 | $ 216 | ||
Loan to Value Ratio | [2] | 70.00% | 62.00% | |
Loan Fee | 5.00% | 5.00% | ||
Ohio [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 2 | 1 | ||
Number of Loans | Loan | 2 | 1 | ||
Value of Collateral | [1] | $ 2,116 | $ 1,405 | |
Commitment Amount | 1,340 | 843 | ||
Gross Amount Outstanding | $ 777 | $ 444 | ||
Loan to Value Ratio | [2] | 63.00% | 60.00% | |
Loan Fee | 5.00% | 5.00% | ||
Pennsylvania [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 2 | 2 | ||
Number of Loans | Loan | 15 | 15 | ||
Value of Collateral | [1] | $ 12,595 | $ 12,725 | |
Commitment Amount | 6,407 | 6,411 | ||
Gross Amount Outstanding | $ 5,244 | $ 5,281 | ||
Loan to Value Ratio | [2] | 51.00% | 50.00% | |
Loan Fee | 5.00% | 5.00% | ||
South Carolina [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 8 | 5 | ||
Number of Loans | Loan | 14 | 7 | ||
Value of Collateral | [1] | $ 4,071 | $ 2,544 | |
Commitment Amount | 2,699 | 1,591 | ||
Gross Amount Outstanding | $ 1,350 | $ 783 | ||
Loan to Value Ratio | [2] | 66.00% | 63.00% | |
Loan Fee | 5.00% | 5.00% | ||
Tennessee [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 1 | 1 | ||
Number of Loans | Loan | 3 | 3 | ||
Value of Collateral | [1] | $ 1,080 | $ 1,080 | |
Commitment Amount | 767 | 767 | ||
Gross Amount Outstanding | $ 711 | $ 430 | ||
Loan to Value Ratio | [2] | 71.00% | 71.00% | |
Loan Fee | 5.00% | 5.00% | ||
Utah [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 1 | 1 | ||
Number of Loans | Loan | 3 | 2 | ||
Value of Collateral | [1] | $ 1,208 | $ 715 | |
Commitment Amount | 846 | 500 | ||
Gross Amount Outstanding | $ 353 | $ 252 | ||
Loan to Value Ratio | [2] | 70.00% | 70.00% | |
Loan Fee | 5.00% | 5.00% | ||
Virginia [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 1 | |||
Number of Loans | Loan | 1 | |||
Value of Collateral | [1] | $ 408 | ||
Commitment Amount | 260 | |||
Gross Amount Outstanding | $ 196 | |||
Loan to Value Ratio | [2] | 64.00% | ||
Loan Fee | 5.00% | |||
Total [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 50 | [3] | 30 | |
Number of Loans | Loan | 147 | 69 | ||
Value of Collateral | [1] | $ 71,948 | $ 46,187 | |
Commitment Amount | 43,987 | 27,141 | ||
Gross Amount Outstanding | $ 27,371 | $ 17,487 | ||
Loan to Value Ratio | [2],[4] | 61.00% | 59.00% | |
Loan Fee | 5.00% | 5.00% | ||
Idaho [Member] | ||||
Summary Of Loan Portfolio To Builders For Home Construction [Line Items] | ||||
Number of Borrowers | Loan | 1 | |||
Number of Loans | Loan | 1 | |||
Value of Collateral | [1] | $ 319 | ||
Commitment Amount | 215 | |||
Gross Amount Outstanding | $ 205 | |||
Loan to Value Ratio | [2] | 67.00% | ||
Loan Fee | 5.00% | |||
[1] | The value is determined by the appraised value. | |||
[2] | The loan to value ratio is calculated by taking the commitment amount and dividing by the appraised value. | |||
[3] | One builder borrows in multiple states. | |||
[4] | Represents the weighted average loan to value ratio of the loans. |
Financing Receivables - Summary
Financing Receivables - Summary of Finance Receivables by Classification (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Loans receivable, gross | $ 31,421 | $ 21,569 |
Pass [Member] | ||
Loans receivable, gross | 25,791 | 18,275 |
Special Mention [Member] | ||
Loans receivable, gross | 3,643 | 3,294 |
Classified - Accruing [Member] | ||
Loans receivable, gross | ||
Classified - Nonaccrual [Member] | ||
Loans receivable, gross | $ 1,987 |
Financing Receivables - Sched38
Financing Receivables - Schedule of Impairment Calculation Method (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total | $ 31,421 | $ 21,569 |
Performing Financial Instruments [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Individually evaluated | 8,978 | 12,424 |
Collectively evaluated | 20,456 | 9,145 |
Non-performing Financial Instruments [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Individually evaluated | ||
Collectively evaluated | $ 1,987 |
Financing Receivables - Summa39
Financing Receivables - Summary of Impaired Loans (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | ||
Unpaid principal balance (contractual obligation from customer) | $ 1,987 | |
Charge-offs and payments applied | ||
Gross value before related allowance | 1,987 | |
Related allowance | 7 | |
Value after allowance | $ 1,980 |
Financing Receivables - Sched40
Financing Receivables - Schedule of Concentration Risk for Individual Borrowers (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Highest Concentration Risk [Member] | ||
Borrower City | Pittsburgh, PA | Pittsburgh, PA |
Percent of Loan Commitments | 23.00% | 37.00% |
Second Highest Concentration Risk [Member] | ||
Borrower City | Sarasota, FL | Sarasota, FL |
Percent of Loan Commitments | 7.00% | 11.00% |
Third Highest Concentration Risk [Member] | ||
Borrower City | Orlando, FL | Savannah, GA |
Percent of Loan Commitments | 5.00% | 6.00% |
Foreclosed Assets - Schedule of
Foreclosed Assets - Schedule of Roll Forward of Foreclosed Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||
Beginning balance | $ 2,798 | $ 3,153 | $ 965 | $ 2,798 | $ 965 | $ 965 | |||
Additions from loans | 1,813 | 1,813 | |||||||
Additions for construction/development | 265 | 375 | 566 | ||||||
Sale proceeds | (1,890) | (463) | |||||||
Gain on sale | 77 | 28 | |||||||
Impairment loss on foreclosed assets | $ (106) | $ (49) | $ (111) | (155) | (111) | ||||
Ending balance | $ 1,095 | $ 2,798 | $ 3,153 | $ 1,095 | $ 3,153 | $ 2,798 |
Property, Plant and Equipment (
Property, Plant and Equipment (Details Narrative) $ in Thousands | 6 Months Ended |
Jun. 30, 2017USD ($) | |
Property, Plant and Equipment [Abstract] | |
Purchased, a partially completed building | $ 625 |
Improvements to building | 27 |
Anticipate cost in project | $ 400 |
Borrowings (Details Narrative)
Borrowings (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2017 | Aug. 31, 2015 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Additions from loans | $ 1,813 | $ 1,813 | |||||
Unsecured note | $ 15,574 | 15,574 | 11,962 | ||||
Interest expense | $ 616 | $ 436 | 1,162 | 798 | 864 | ||
S.K. Funding, LLC [Member] | |||||||
Loans payable | $ 7,770 | ||||||
Four Other Unsecured [Member] | |||||||
Interest expense | $ 30 | $ 6 | |||||
Notes Program [Member] | |||||||
Debt instrument, interest rate, stated percentage | 8.58% | 8.58% | 8.26% | ||||
Notes Program [Member] | Minimum [Member] | |||||||
Debt instrument, term | 12 months | ||||||
Notes Program [Member] | Maximum [Member] | |||||||
Debt instrument, term | 48 months | ||||||
Builder Finance, Inc [Member] | |||||||
Percentage of each loan | 50.00% | ||||||
Borrowings floor interest rate | 9.00% | 9.00% | |||||
S.K. Funding, LLC [Member] | |||||||
Percentage of each loan | 70.00% | ||||||
Borrowings floor interest rate | 12.00% | 12.00% | |||||
Additions from loans | $ 8,523 | ||||||
Affiliate Loans [Member] | |||||||
Debt instrument, interest rate, stated percentage | 4.41% | 4.41% | 4.19% | ||||
Maximum availability | $ 1,500 | $ 1,500 | |||||
7 Kings [Member] | |||||||
Short-term debt, maximum amount outstanding during period | 500 | $ 500 | |||||
Short-term debt, average outstanding amount | $ 500 | $ 500 | |||||
Other Unsecured Loans [Member] | |||||||
Debt instrument, interest rate, stated percentage | 10.00% | 7.50% | |||||
Debt instrument, maturity date | Jan. 28, 2018 | Feb. 19, 2016 | Aug. 18, 2017 | Aug. 18, 2017 | |||
Debt instrument, periodic payment, interest | $ 19 | $ 19 | |||||
Builder's Finance, Inc [Member] | |||||||
Short-term debt, maximum amount outstanding during period | 500 | ||||||
Short-term debt, average outstanding amount | 500 | ||||||
Other Unsecured Loans One [Member] | |||||||
Debt instrument, periodic payment, interest | $ 18 |
Borrowings - Schedule of Borrow
Borrowings - Schedule of Borrowings (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Debt Disclosure [Abstract] | ||
Purchase and sale agreements | $ 8,820 | $ 7,322 |
Secured line of credit from affiliates | ||
Unsecured line of credit (senior) | 500 | |
Other unsecured debt (senior subordinated) | 279 | 279 |
Unsecured Notes through our public offering, gross | 14,239 | 11,221 |
Other unsecured debt (subordinated) | 713 | 700 |
Other unsecured debt (junior subordinated) | 173 | 173 |
Total | $ 24,724 | $ 19,695 |
Borrowings - Schedule of Maturi
Borrowings - Schedule of Maturities of Long-term Debt (Details) $ in Thousands | Jun. 30, 2017USD ($) |
Total Amount Maturing [Member] | |
2,017 | $ 9,693 |
2,018 | 5,133 |
2,019 | 3,569 |
2,020 | 1,943 |
2,021 | 4,386 |
Total | 24,724 |
Public Offering [Member] | |
2,017 | 373 |
2,018 | 4,633 |
2,019 | 3,456 |
2,020 | 1,943 |
2,021 | 3,834 |
Total | 14,239 |
Other Unsecured [Member] | |
2,017 | 500 |
2,018 | 500 |
2,019 | 113 |
2,020 | |
2,021 | 552 |
Total | 1,665 |
Purchase and Sale Agreements [Member] | |
2,017 | 8,820 |
2,018 | |
2,019 | |
2,020 | |
2,021 | |
Total | $ 8,820 |
Borrowings - Schedule of Purcha
Borrowings - Schedule of Purchase and Sale Agreements (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Book Value of Loans which Served as Collateral | $ 18,030 | $ 13,549 |
Due From Shepherd's Finance to Loan Purchaser | 8,820 | 7,322 |
1st Financial Bank [Member] | ||
Book Value of Loans which Served as Collateral | 9,507 | |
Due From Shepherd's Finance to Loan Purchaser | 5,207 | |
S.K. Funding, LLC [Member] | ||
Book Value of Loans which Served as Collateral | 8,523 | 7,770 |
Due From Shepherd's Finance to Loan Purchaser | $ 3,613 | 4,805 |
1st Financial Bank [Member] | ||
Book Value of Loans which Served as Collateral | 5,779 | |
Due From Shepherd's Finance to Loan Purchaser | $ 2,517 |
Borrowings - Schedule of Roll F
Borrowings - Schedule of Roll Forward of Notes Outstanding (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |||
Gross notes outstanding, beginning of period | $ 11,221 | $ 8,496 | $ 8,496 |
Notes issued | 8,105 | 2,255 | 4,972 |
Note repayments / redemptions | (5,087) | (59) | (2,247) |
Gross notes outstanding, end of period | 14,239 | 10,692 | 11,221 |
Less deferred financing costs, net | 330 | 493 | 411 |
Notes outstanding, net | $ 13,909 | $ 10,199 | $ 10,810 |
Borrowings - Schedule of Roll48
Borrowings - Schedule of Roll Forward of Deferred Financing Cost (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Debt Disclosure [Abstract] | ||||
Deferred financing costs, beginning balance | $ 1,014 | $ 935 | $ 935 | |
Additions | 40 | 28 | 79 | |
Deferred financing costs, ending balance | 1,054 | 963 | 1,014 | |
Less accumulated amortization | (724) | (470) | (603) | $ (336) |
Deferred financing costs, net | $ 330 | $ 493 | $ 411 |
Borrowings - Schedule of Roll49
Borrowings - Schedule of Roll Forward of Accumulated Amortization of Deferred Financing Costs (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |||
Accumulated amortization, beginning balance | $ 603 | $ 336 | $ 336 |
Additions | 121 | 134 | 267 |
Accumulated amortization, ending balance | $ 724 | $ 470 | $ 603 |
Redeemable Preferred Equity (De
Redeemable Preferred Equity (Details Narrative) | 6 Months Ended |
Jun. 30, 2017 | |
Change in rate of note interest | 12.00% |
Series C Preferred Units [Member] | |
Unit distribution percentage | 12.00% |
Redeemable Preferred Equity - S
Redeemable Preferred Equity - Schedule of Roll Forward of Redeemable Preferred Equity (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Equity [Abstract] | |||
Redeemable preferred equity beginning balance | |||
Additions from new investment | 1,004 | ||
Additions from reinvestment | 29 | ||
Redeemable preferred equity ending balance | $ 1,033 |
Redeemable Preferred Equity -52
Redeemable Preferred Equity - Schedule of Redemption Option for Investors (Details) - USD ($) $ in Thousands | 6 Months Ended | |||
Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | |
Equity [Abstract] | ||||
Year Maturing | 2,023 | |||
Total Amount Redeemable | $ 1,033 |
Members' Capital (Details Narra
Members' Capital (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 6 Months Ended | |
Dec. 31, 2015 | Jun. 30, 2017 | Dec. 31, 2016 | |
Series B preferred equity | $ 1,160 | $ 1,150 | |
Independent Manager 1 [Member] | |||
Percentage of common equity sold | 1.00% | ||
Independent Manager 2 [Member] | |||
Percentage of common equity sold | 1.00% | ||
Independent Manager 3 [Member] | |||
Percentage of common equity sold | 1.00% | ||
Executive Vice President [Member] | |||
Percentage of common equity sold | 1.00% | ||
Common Class A [Member] | |||
Common stock, outstanding | 2,629 | 2,629 | |
Common Class A [Member] | Seven Kings Holdings, Inc [Member] | Wallach Family [Member] | |||
Percentage of common equity purchased | 4.00% | ||
Common Class A [Member] | S.K. Funding, LLC [Member] | Wallach Family [Member] | |||
Percentage of common equity purchased | 4.00% | ||
Series B Cumulative Preferred Stock [Member] | |||
Preferred stock, value | $ 1,000 | ||
Preferred stock, profit distribution | 10.00% | ||
Number of units agreed to purchase | Hoskins Group agreed to purchase 0.1 Series B Preferred Units for $10 at each closing of a lot to a third party in the Hamlets and Tuscany subdivision. As of June 30, 2017, the Hoskins Group owns a total of 11.6 Series B Preferred Units, which were issued for a total of $1,160. | ||
Invest in preferred equity, per closing of a lot payoff | $ 10 |
Members' Capital - Schedule of
Members' Capital - Schedule of Capital Units (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Members' Equity | $ 3,558 | $ 3,399 |
B Preferred Units [Member] | ||
Members' Equity | 1,160 | 1,150 |
A Common Units [Member] | ||
Members' Equity | $ 2,398 | $ 2,249 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 |
Notes outstanding | $ 14,239 | $ 11,221 | $ 10,692 | $ 8,496 |
Notes And Accounts Payable To Affiliates [Member] | ||||
Notes outstanding | $ 1,701 | $ 2,810 | ||
Class A Common Units [Member] | ||||
Percentage of ownership interest | 1.00% |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Related Party Transactions (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
David Wallach [Member] | |||
Relationship | Parent of Independent Manager | ||
Notes Payable, Related Parties | $ 211 | $ 111 | |
Weighted Average Interest Rate | 9.42% | ||
Interest Expense, Related Party | $ 6 | $ 5 | |
R. Scott Summers [Member] | |||
Relationship | Son of Independent Manager | ||
Notes Payable, Related Parties | $ 275 | 75 | |
Weighted Average Interest Rate | 8.00% | ||
Interest Expense, Related Party | $ 8 | 12 | |
Wallach Family Irrevocable Educational Trust [Member] | |||
Relationship | Trustee is Member | ||
Notes Payable, Related Parties | $ 200 | 200 | |
Weighted Average Interest Rate | 9.00% | ||
Interest Expense, Related Party | $ 9 | 8 | |
Eric A. Rauscher [Member] | |||
Relationship | Independent Manager | ||
Notes Payable, Related Parties | $ 475 | 600 | |
Weighted Average Interest Rate | 10.00% | ||
Interest Expense, Related Party | $ 21 | 22 | |
Joseph Rauscher [Member] | |||
Relationship | Parent of Independent Manager | ||
Notes Payable, Related Parties | $ 195 | $ 186 | |
Weighted Average Interest Rate | 9.33% | ||
Interest Expense, Related Party | $ 9 | $ 8 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Dec. 31, 2016 | |
Letter of credit, amount outstanding | $ 17,797 | $ 11,503 |
Pennsylvania [Member] | July 2017 [Member] | ||
Proceeds from sale of participating interest in loan | 3,000 | |
Proceeds from secured line of credit | 1,325 | |
Combined debt amount | $ 4,325 | |
Percentage of participating interest sold on loans | 70.00% | |
Loan sold already not funded amount | $ 3,356 | |
Designated for sale of debt | 4,442 | |
Non designated for sale of debt | $ 3,387 | |
Debt Instrument, Description | There are loans that we have designated for sale which, at 70% funding, will eventually provide $4,442 in liquidity, and there are loans we have not designated for sale, which, if sold at 70% funding, would eventually provide $ 3,387 in liquidity. |
Selected Quarterly Condensed 58
Selected Quarterly Condensed Consolidated Financial Data (Unaudited) - Summarized Unaudited Quarterly Condensed Consolidated Financial Data (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Net Interest Income after Loan Loss Provision | $ 725 | $ 617 | $ 491 | $ 442 | $ 464 | $ 479 | |||
Non-Interest Income | 77 | 28 | 44 | $ 77 | $ 44 | ||||
SG&A expense | 456 | 454 | 367 | 297 | 305 | 350 | 910 | 655 | |
Impairment loss on foreclosed assets | 106 | 49 | 111 | 155 | $ 111 | ||||
Net Income | 163 | $ 191 | $ 41 | $ 145 | $ 203 | $ 129 | $ 354 | $ 332 | |
Dec 31, 2017 [Member] | |||||||||
Net Interest Income after Loan Loss Provision | |||||||||
Non-Interest Income | |||||||||
SG&A expense | |||||||||
Impairment loss on foreclosed assets | |||||||||
Net Income | |||||||||
Sep 30, 2017 [Member] | |||||||||
Net Interest Income after Loan Loss Provision | |||||||||
Non-Interest Income | |||||||||
SG&A expense | |||||||||
Impairment loss on foreclosed assets | |||||||||
Net Income |
Non-Interest Expense Detail - S
Non-Interest Expense Detail - Schedule of Selling General and Administrative Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Non-interest Expense Detail | ||||||||
Legal and accounting | $ 125 | $ 112 | ||||||
Salaries and related expenses | 583 | 385 | ||||||
Board related expenses | 55 | 55 | ||||||
Advertising | 25 | 25 | ||||||
Rent and utilities | 14 | 10 | ||||||
Loan and foreclosed asset expenses | 26 | 17 | ||||||
Travel | 32 | 19 | ||||||
Other | 50 | 32 | ||||||
Total SG&A | $ 456 | $ 454 | $ 367 | $ 297 | $ 305 | $ 350 | $ 910 | $ 655 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] $ in Thousands | Jul. 24, 2017USD ($) |
Debt face amount | $ 3,000 |
Sixth Amendment [Member] | S.K. Funding, LLC [Member] | |
Interest rate | 10.50% |
Outstanding amount | $ 4,000 |
Minimum [Member] | Pennsylvania Loans [Member] | |
Debt face amount | 1,000 |
Minimum [Member] | Pennsylvania Loans [Member] | S.K. Funding, LLC [Member] | |
Debt face amount | 1,000 |
Minimum [Member] | Sixth Amendment [Member] | |
Debt face amount | 4,000 |
Maximum [Member] | Pennsylvania Loans [Member] | S.K. Funding, LLC [Member] | |
Debt face amount | $ 3,000 |