The Company’s investments in fixed maturity securities held to maturity and equity securities available for sale as of December 31, 2014 are summarized as follows:

The Company’s investments in fixed maturity securities held to maturity and equity securities available for sale as of December 31, 2013 are summarized as follows:

Fixed Maturity Securities

The following tables summarize unrealized losses on fixed maturities securities, which are carried at amortized cost, at December 31, 2014 and 2013. The unrealized losses were primarily related to interest rate fluctuations. The tables set forth unrealized losses by duration and number of investment positions, together with the fair value of the related fixed maturity securities:

	Unrealized Losses for Less than Twelve Months	No. of Investment Positions	Unrealized Losses for More than Twelve Months	No. of Investment Positions	Total Unrealized Loss
At December 31, 2014
Redeemable Preferred Stock	$ -	0	$ -	0	$ -
Obligations of States and
Political Subdivisions	-	0	5,278	1	5,278
Corporate Securities	548,310	21	432,047	11	980,357
Mortgage and other
asset-backed securities	3,966	1	7,928	0	11,894
Total unrealized losses	$ 552,276	22	$ 445,253	12	$ 997,529
Fair Value	$ 7,081,352		$2,777,587		$9,858,939

At December 31, 2013
Redeemable Preferred Stock	$ 5,900	1	$ -	0	$ 5,900
Obligations of States and
Political Subdivisions	7,131	1	2,273	1	9,404
Corporate Securities	1,134,415	72	260,504	10	1,394,919
Mortgage and other
asset-backed securities	3,109	1	8,242	1	11,351
Total unrealized losses	$ 1,150,555	75	$ 271,019	12	$1,421,574
Fair Value	$22,002,277		$2,308,464		$24,310,741

As of December 31, 2014, the average market value of the related fixed maturities was 90.8% of amortized cost and the average market value was 94.5% of amortized cost as of December 31, 2013. During 2014, 2013 and 2012, an other than temporary decline in market value resulted in the recognition of credit losses on fixed maturity securities of $120,000, $120,000 and $165,000, respectively.

On a quarterly basis, the Company reviews its available for sale fixed investment securities related to corporate securities and other public utilities, consisting of bonds and preferred stocks that are in a loss position. The review involves an analysis of the securities in relation to historical values, and projected earnings and revenue growth rates. Based on the analysis, a determination is made whether a security will likely recover from the loss position within a reasonable period of time. If it is unlikely that the investment will recover from the loss position, the loss is considered to be other-than-temporary, the security is written down to the impaired value and an impairment loss is recognized.

Equity Securities

The following tables summarize unrealized losses on equity securities that were carried at estimated fair value based on quoted trading prices at December 31, 2014 and 2013. The unrealized losses were primarily the result of decreases in market value due to overall equity market declines. The tables set forth unrealized losses by duration and number of investment positions, together with the fair value of the related equity securities available for sale in a loss position:

	Unrealized Losses for Less than Twelve Months	No. of Investment Positions	Unrealized Losses for More than Twelve Months	No. of Investment Positions	Total Unrealized Losses
At December 31, 2014
Industrial, miscellaneous and all other	$ 327,389	138	$ 492,744	27	$ 820,133
Total unrealized losses	$ 327,389	138	$ 492,744	27	$ 820,133
Fair Value	$2,162,425		$ 676,706		$2,839,131

At December 31, 2013
Industrial, miscellaneous and all other	$ 119,449	28	$ 405,936	28	$ 525,386
Total unrealized losses	$ 119,449	28	$ 405,936	28	$ 525,386
Fair Value	$ 993,612		$ 772,345		$1,765,957

As of December 31, 2014, the average market value of the equity securities available for sale was 77.6% of the original investment and the average market value was 77.1% of the original investment as of December 31, 2013. The intent of the Company is to retain equity securities for a period of time sufficient to allow for the recovery in fair value. However, the Company may sell equity securities during a period in which the fair value has declined below the amount of the original investment. In certain situations, new factors, including changes in the business environment, can change the Company’s previous intent to continue holding a security. During 2014, 2013, and 2012, an other than temporary decline in the market value resulted in the recognition of an impairment loss on equity securities of $44,240, $100,304, and $247,317, respectively.

On a quarterly basis, the Company reviews its investment in industrial, miscellaneous and all other equity securities that are in a loss position. The review involves an analysis of the securities in relation to historical values, price earnings ratios, projected earnings and revenue growth rates. Based on the analysis a determination is made whether a security will likely recover from the loss position within a reasonable period of time. If it is unlikely that the investment will recover from the loss position, the loss is considered to be other than temporary, the security is written down to the impaired value and an impairment loss is recognized.

The fair values of fixed maturity securities are based on quoted market prices, when available. For fixed maturity securities not actively traded, fair values are estimated using values obtained from independent pricing services, or in the case of private placements, are estimated by discounting expected future cash flows using a current market value applicable to the coupon rate, credit and maturity of the investments. The fair values for equity securities are based on quoted market prices.

The amortized cost and estimated fair value of fixed maturity securities at December 31, 2014, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because certain borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized	Estimated Fair
	Cost	Value
Held to Maturity:
Due in 2015	$ 4,961,596	$ 5,075,769
Due in 2016 through 2019	33,920,182	37,561,840
Due in 2020 through 2024	25,074,149	27,690,447
Due after 2024	66,187,191	75,238,571
Mortgage-backed securities	4,263,206	4,556,693
Redeemable preferred stock	612,023	634,055
Total held to maturity	$ 135,018,347	$ 150,757,375

The cost and estimated fair value of available for sale securities at December 31, 2014, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because certain borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Equities are valued using the specific identification method.

		Estimated Fair
	Cost	Value
Available for Sale:
Common stock	$ 7,179,010	$ 6,752,750
Total available for sale	$ 7,179,010	$ 6,752,750

The Company’s realized gains and losses and other than temporary impairments from investments and other assets are summarized as follows:

	2014	2013	2012
Fixed maturity securities held
to maturity:
Gross realized gains	$ 390,203	$ 97,238	$ 470,874
Gross realized losses	(71,800)	(41,164)	(3,875)
Other than temporary impairments	(120,000)	(120,000)	(165,000)

Securities available for sale:
Gross realized gains	349,207	540,990	392,033
Gross realized losses	(55,222)	(2,678)	(5,705)
Other than temporary impairments	(44,240)	(100,304)	(247,317)

Other assets:
Gross realized gains	1,445,596	824,203	794,346
Gross realized losses	(139,808)	(538)	(223,163)
Other than temporary impairments	-	(115,922)	(795,315)
Total	$ 1,753,936	$ 1,081,825	$ 216,878

The net carrying amount for sales of securities classified as held to maturity was $2,840,709, $1,455,835 and $2,174,300, for the years ended December 31, 2014, 2013 and 2012, respectively. The net realized gain related to these sales was $20,722, $12,533 and $271,364, for the years ended December 31, 2014, 2013 and 2012, respectively. Certain circumstances lead to these decisions to sell.

There were no investments, aggregated by issuer, in excess of 10% of shareholders’ equity (before net unrealized gains and losses on available-for-sale securities) at December 31, 2014, other than investments issued or guaranteed by the United States Government.

Major categories of net investment income are as follows:

	2014	2013	2012
Fixed maturity securities	$ 8,229,451	$ 8,265,949	$ 7,731,051
Equity securities	212,917	210,491	264,063
Mortgage loans on real estate	7,550,110	4,666,910	5,543,777
Real estate	8,433,895	6,658,185	4,927,128
Policy, student and other loans	741,220	799,703	830,683
Short-term investments, principally gains on sale of mortgage loans	12,397,382	8,952,584	8,716,257
Gross investment income	37,564,975	29,553,822	28,012,959
Investment expenses	(9,261,235)	(9,199,820)	(6,097,382)
Net investment income	$ 28,303,740	$ 20,354,002	$ 21,915,577

Net investment income includes net investment income earned by the restricted assets of the cemeteries and mortuaries of $356,369, $341,430 and $352,488 for 2014, 2013 and 2012, respectively.

Net investment income on real estate consists primarily of rental revenue received under short-term leases.

Investment expenses consist primarily of depreciation, property taxes, operating expenses of real estate and an estimated portion of administrative expenses relating to investment activities.

Securities on deposit for regulatory authorities as required by law amounted to $8,886,001 at December 31, 2014 and $9,215,222 at December 31, 2013. The restricted securities are included in various assets under investments on the accompanying consolidated balance sheets.

Mortgage Loans

Mortgage loans consist of first and second mortgages. The mortgage loans bear interest at rates ranging from 2.0 % to 10.5%, maturity dates range from three months to 30 years and are secured by real estate. Concentrations of credit risk arise when a number of mortgage loan debtors have similar economic characteristics that would cause their ability to meet contractual obligations to be similarly affected by changes in economic conditions. Although the Company has a diversified mortgage loan portfolio consisting of residential mortgages, commercial loans and residential construction loans and requires collateral on all real estate exposures, a substantial portion of its debtors’ ability to honor obligations is reliant on the economic stability of the geographic region in which the debtors do business. At December 31, 2014, the Company has 44%, 17%, 13% and 8% of its mortgage loans from borrowers located in the states of Utah, California, Texas and Florida, respectively. The mortgage loans on real estate balances on the consolidated balance sheet are reflected net of an allowance for loan losses of $2,003,055 and $1,652,090 at December 31, 2014 and 2013, respectively.

The Company establishes a valuation allowance for credit losses in its portfolio.

The following is a summary of the allowance for loan losses as a contra-asset account for the periods presented:

Allowance for Credit Losses and Recorded Investment in Mortgage Loans
For the Years Ended December 31, 2014, and 2013

	Commercial	Residential	Residential Construction	Total
2014
Allowance for credit losses:
Beginning balance	$ 187,129	$ 1,364,847	$ 100,114	$ 1,652,090
Charge-offs	-	(38,444)	-	(38,444)
Provision	-	389,409	-	389,409
Ending balance	$ 187,129	$ 1,715,812	$ 100,114	$ 2,003,055

Ending balance: individually evaluated for impairment	$ -	$ 153,446	$ -	$ 153,446

Ending balance: collectively evaluated for impairment	$ 187,129	$ 1,562,366	$ 100,114	$ 1,849,609

Ending balance: loans acquired with deteriorated credit quality	$ -	$ -	$ -	$ -

Mortgage loans:
Ending balance	$ 35,388,756	$ 53,592,433	$ 33,071,938	$ 122,053,127

Ending balance: individually evaluated for impairment	$ -	$ 1,556,182	$ 414,499	$ 1,970,681

Ending balance: collectively evaluated for impairment	$ 35,388,756	$ 52,036,251	$ 32,657,439	$ 120,082,446

Ending balance: loans acquired with deteriorated credit quality	$ -	$ -	$ -	$ -

2013
Allowance for credit losses:
Beginning balance	$ -	$ 4,193,674	$ 46,187	$ 4,239,861
Charge-offs	-	(2,670,794)	(137,629)	(2,808,423)
Provision	187,129	(158,033)	191,556	220,652
Ending balance	$ 187,129	$ 1,364,847	$ 100,114	$ 1,652,090

Ending balance: individually evaluated for impairment	$ -	$ 152,745	$ -	$ 152,745

Ending balance: collectively evaluated for impairment	$ 187,129	$ 1,212,102	$ 100,114	$ 1,499,345

Ending balance: loans acquired with deteriorated credit quality	$ -	$ -	$ -	$ -

Mortgage loans:
Ending balance	$ 41,653,009	$ 49,868,486	$ 12,912,473	$ 104,433,968

Ending balance: individually evaluated for impairment	$ -	$ 1,518,327	$ -	$ 1,518,327

Ending balance: collectively evaluated for impairment	$ 41,653,009	$ 48,350,159	$ 12,912,473	$ 102,915,641

Ending balance: loans acquired with deteriorated credit quality	$ -	$ -	$ -	$ -

The following is a summary of the aging of mortgage loans for the periods presented.

Age Analysis of Past Due Mortgage Loans
Years Ended December 31, 2014 and 2013

	30-59 Days Past Due	60-89 Days Past Due	Greater Than 90 Days 1)	In Foreclosure 1)	Total Past Due	Current	Total Mortgage Loans	Allowance for Loan Losses	Net Mortgage Loans
2014
Commercial	$ -	$ -	$ -	$ -	$ -	$ 35,388,756	$ 35,388,756	$ (187,129)	$ 35,201,627
Residential	1,631,142	1,174,516	5,464,901	1,556,182	9,826,741	43,765,692	53,592,433	(1,715,812)	51,876,621
Residential Construction	-	-	64,895	414,499	479,394	32,592,544	33,071,938	(100,114)	32,971,824

Total	$ 1,631,142	$ 1,174,516	$ 5,529,796	$ 1,970,681	$ 10,306,135	$ 111,746,992	$ 122,053,127	$ (2,003,055)	$ 120,050,072

2013
Commercial	$ -	$ -	$ -	$ 4,973,745	$ 4,973,745	$ 36,679,264	$ 41,653,009	$ (187,129)	$ 41,465,880
Residential	1,646,953	1,604,847	5,867,501	1,518,327	10,637,628	39,230,858	49,868,486	(1,364,847)	48,503,639
Residential Construction	-	-	64,895	-	64,895	12,847,578	12,912,473	(100,114)	12,812,359

Total	$ 1,646,953	$ 1,604,847	$ 5,932,396	$ 6,492,072	$ 15,676,268	$ 88,757,700	$ 104,433,968	$ (1,652,090)	$ 102,781,878

1) There was not any interest income recognized on loans past due greater than 90 days or in foreclosure.

Impaired Mortgage Loans

Impaired mortgage loans include loans with a related specific valuation allowance or loans whose carrying amount has been reduced to the expected collectible amount because the impairment has been considered other than temporary. The recorded investment in and unpaid principal balance of impaired loans along with the related loan specific allowance for losses, if any, for each reporting period and the average recorded investment and interest income recognized during the time the loans were impaired were as follows:

Impaired Loans
For the Years Ended December 31, 2014, and 2013

	Recorded Investment	Unpaid Principal Balance	Related Allowance	Average Recorded Investment	Interest Income Recognized
2014
With no related allowance recorded:
Commercial	$ -	$ -	$ -	$ -	$ -
Residential	-	-	-	-	-
Residential construction	414,499	414,499	-	414,499	-

With an allowance recorded:
Commercial	$ -	$ -	$ -	$ -	$ -
Residential	1,556,182	1,556,182	153,446	1,556,182	-
Residential construction	-	-	-	-	-

Total:
Commercial	$ -	$ -	$ -	$ -	$ -
Residential	1,556,182	1,556,182	153,446	1,556,182	-
Residential construction	414,499	414,499	-	414,499	-

2013
With no related allowance recorded:
Commercial	$ -	$ -	$ -	$ -	$ -
Residential	-	-	-	-	-
Residential construction	-	-	-	-	-

With an allowance recorded:
Commercial	$ -	$ -	$ -	$ -	$ -
Residential	1,518,327	1,518,327	152,745	1,518,327	-
Residential construction	-	-	-	-	-

Total:
Commercial	$ -	$ -	$ -	$ -	$ -
Residential	1,518,327	1,518,327	152,745	1,518,327	-
Residential construction	-	-	-	-	-

Credit Risk Profile Based on Performance Status

The Company’s mortgage loan portfolio is monitored based on performance of the loans. Monitoring a mortgage loan increases when the loan is delinquent or earlier if there is an indication of impairment. The Company defines non-performing mortgage loans as loans 90 days or greater delinquent or on non-accrual status.

The Company’s performing and non-performing mortgage loans were as follows:

Mortgage Loan Credit Exposure
Credit Risk Profile Based on Payment Activity
As of December 31, 2014, and 2013

	Commercial		Residential		Residential Construction		Total
	2014	2013	2014	2013	2014	2013	2014	2013

Performing	$ 35,388,756	$ 36,679,264	$ 46,571,350	$ 42,482,658	$ 32,592,544	$ 12,847,578	$ 114,552,650	$ 92,009,500
Non-performing	-	4,973,745	7,021,083	7,385,828	479,394	64,895	7,500,477	12,424,468

Total	$ 35,388,756	$ 41,653,009	$ 53,592,433	$ 49,868,486	$ 33,071,938	$ 12,912,473	$ 122,053,127	$ 104,433,968

Non-Accrual Mortgage Loans

Once a loan is past due 90 days, it is the policy of the Company to end the accrual of interest income on the loan and write off any income that had been accrued. Interest not accrued on these loans totals $535,000 and $678,000 as of December 31, 2014 and 2013, respectively.

The following is a summary of mortgage loans on a non-accrual status for the periods presented.

	Mortgage Loans on Non-accrual Status
	As of December 31, 2014, and 2013

	2014	2013
Commercial	$ -	$ 4,973,745
Residential	7,021,083	7,385,828
Residential construction	479,394	64,895
Total	$ 7,500,477	$ 12,424,468

Principal Amounts Due

The amortized cost and contractual payments on mortgage loans on real estate and construction loans held for investment by category as of December 31, 2014 are shown below. Expected principal payments may differ from contractual obligations because certain borrowers may elect to pay off mortgage obligations with or without early payment penalties.

		Principal	Principal	Principal
		Amounts	Amounts	Amounts
		Due in	Due in	Due
	Total	2015	2016-2019	Thereafter
Residential	$ 53,592,433	$ 3,748,893	$ 17,225,255	$ 32,618,285
Residential Construction	33,071,938	32,648,470	423,468	-
Commercial	35,388,756	18,652,738	13,279,688	3,456,330
Total	$ 122,053,127	$ 55,050,101	$ 30,928,411	$ 36,074,615

Loan Loss Reserve

When a repurchase demand is received from a third party investor, the relevant data is reviewed and captured so that an estimated future loss can be calculated. The key factors that are used in the estimated loss calculation are as follows: (i) lien position, (ii) payment status, (iii) claim type, (iv) unpaid principal balance, (v) interest rate, and (vi) validity of the demand. Other data is captured and is useful for management purposes; the actual estimated loss is generally based on these key factors. The Company conducts its own review upon the receipt of a repurchase demand. In many instances, the Company is able to resolve the issues relating to the repurchase demand by the third party investor without having to make any payments to the investor.

The following is a summary of the loan loss reserve which is included in other liabilities and accrued expenses:

	Years Ended December 31
	2014	2013
Balance, beginning of period	$ 5,506,532	$ 6,035,295
Provisions for losses	3,053,403	1,846,285
Charge-offs and settlements	(6,841,785)	(2,375,048)
Balance, at December 31	$ 1,718,150	$ 5,506,532

The Company believes the loan loss reserve represents probable loan losses incurred as of the balance sheet date. Actual loan loss experience could change, in the near-term, from the established reserve based upon claims that could be asserted by third party investors. SecurityNational Mortgage believes there is potential to resolve any alleged claims by third party investors on acceptable terms. If SecurityNational Mortgage is unable to resolve such claims on acceptable terms, legal action may ensue. In the event of legal action by any third party investor, SecurityNational Mortgage believes it has significant defenses to any such action and intends to vigorously defend itself against such action.