12) Mortgage Servicing Rights

3 Months Ended

Mar. 31, 2014

Notes

12) Mortgage Servicing Rights

12)       Mortgage Servicing Rights

The following is a summary of the MSR activity for the periods presented.

	As of March 31	As of December 31
	2014	2013
Amortized cost:
Balance before valuation allowance at beginning of year	$         4,844,101	$            2,797,470
MSRs proceeds from loan sales	461,301	2,494,254
Amortization	(151,907)	(447,623)
Application of valuation allowance to write down MSRs with other than temporary impairment	-	-
Balance before valuation allowance at year end	$         5,153,495	$            4,844,101
Valuation allowance for impairment of MSRs:
Balance at beginning of year	$                     -	$                        -
Additions	-	-
Application of valuation allowance to write down MSRs    with other than temporary impairment	-	-
Balance at end of period	$                     -	$                        -
Mortgage servicing rights, net	$         5,153,495	$            4,844,101
Estimated fair value of MSRs at end of period	$         5,737,372	$            5,491,270

The Company reports these MSRs pursuant to the accounting policy discussed in Note 8 and Note 9. The following table summarizes the Company’s estimate of future amortization of its existing MSRs carried at amortized cost. This projection was developed using the assumptions made by management in its March 31, 2014 valuation of MSRs. The assumptions underlying the following estimate will change as market conditions and portfolio composition and behavior change, causing both actual and projected amortization levels to change over time. Therefore, the estimates will change in a manner and amount not presently determinable by management.