Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2012

Note 13 – Fair Value of Financial Instruments

The following table presents the carrying value and estimated fair value of the Company’s financial instruments not carried at fair value on the consolidated balance sheet at September 30, 2012 and December 31, 2011:


	September 30, 2012						December 31, 2011
	Carrying Value			Estimated Fair Value			Carrying Value			Estimated Fair Value
Cash and cash equivalents	$	67,994		$	67,994		$	21,568		$	21,568
Commercial first mortgage loans		104,101			111,886			109,006			116,516
Subordinate loans		196,177			200,427			149,086			154,778
Repurchase agreements		10,975			10,975			47,439			47,415
TALF borrowings		—			—			(251,327	)		(256,171	)
Borrowings under repurchase agreements		(242,970	)		(242,970	)		(290,700	)		(290,700	)

To determine estimated fair values of the financial instruments listed above, market rates of interest, which include credit assumptions, are used to discount contractual cash flows. The estimated fair values are not necessarily indicative of the amount the Company could realize on disposition of the financial instruments. The use of different market assumptions or estimation methodologies could have a material effect on the estimated fair value amounts. The Company’s commercial first mortgage loans, subordinate loans and repurchase agreements are carried at amortized cost on the condensed consolidated financial statements and are classified as Level III in the fair value hierarchy.