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NOTES AND INTEREST RECEIVABLE
 3 Months Ended
Mar. 31, 2017
Receivables [Abstract]  
NOTES AND INTEREST RECEIVABLE

NOTE 3. NOTES AND INTEREST RECEIVABLE

 

A portion of our assets are invested in mortgage notes receivable, principally secured by real estate. We may originate mortgage loans in conjunction with providing purchase money financing of property sales. Notes receivable are generally collateralized by real estate or interests in real estate and guarantees, unless noted otherwise, are so secured. Management intends to service and hold for investment the mortgage notes in our portfolio. A majority of the notes receivable provide for principal to be paid at maturity. Below is a summary of our notes receivable as of March 31, 2017 (dollars in thousands):

 

TCI NOTE 3 - NOTES AND INTEREST RECEIVABLE - March 31, 2017 

                     
Borrower   Maturity
Date		   Interest
Rate		     Amount     Collateral
Performing loans:                          
H198, LLC (Las Vegas Land)     01/20     12.00 %     5,907     Secured
Oulan-Chikh Family Trust     03/21     8.00 %     174     Secured
Unified Housing Foundation, Inc. (Echo Station) (1)     12/32     12.00 %     1,481     Secured
Unified Housing Foundation, Inc. (Lakeshore Villas) (1)     12/32     12.00 %     2,000     Secured
Unified Housing Foundation, Inc. (Lakeshore Villas) (1)     12/32     12.00 %     6,368     Secured
Unified Housing Foundation, Inc. (Limestone Canyon) (1)     12/32     12.00 %     4,640     Secured
Unified Housing Foundation, Inc. (Limestone Canyon) (1)     12/32     12.00 %     2,653     Secured
Unified Housing Foundation, Inc. (Limestone Ranch) (1)     12/32     12.00 %     6,000     Secured
Unified Housing Foundation, Inc. (Limestone Ranch) (1)     12/32     12.00 %     1,953     Secured
Unified Housing Foundation, Inc. (Parkside Crossing) (1)     12/32     12.00 %     1,936     Secured
Unified Housing Foundation, Inc. (Sendero Ridge) (1)     12/32     12.00 %     4,812     Secured
Unified Housing Foundation, Inc. (Sendero Ridge) (1)     12/32     12.00 %     4,491     Secured
Unified Housing Foundation, Inc. (Timbers of Terrell) (1)     12/32     12.00 %     1,323     Secured
Unified Housing Foundation, Inc. (Tivoli) (1)     12/32     12.00 %     7,966     Secured
Unified Housing Foundation, Inc. (1)     12/17     12.00 %     1,207     Unsecured
Unified Housing Foundation, Inc. (1)     12/18     12.00 %     3,994     Unsecured
Unified Housing Foundation, Inc. (1)     12/18     12.00 %     6,407     Unsecured
Unified Housing Foundation, Inc. (1)     06/19     12.00 %     5,400     Unsecured
Other related party notes (1)     Various     Various       782     Various unsecured interests
Other non-related party notes     Various     Various       796     Various secured interests
Other non-related party notes     Various     Various       4,658     Various unsecured interests
Accrued interest                   3,733      
Total Performing                 $ 78,681      
                           
Allowance for estimated losses                   (1,825 )    
Total                 $ 76,856      

  

  (1) Related party notes

 

We invest in mortgage loans, secured by mortgages that are subordinate to one or more prior liens either on the fee or a leasehold interest in real estate. Recourse on such loans ordinarily includes the real estate on which the loan is made, other collateral and guarantees.

 

At March 31, 2017, we had mortgage loans and accrued interest receivable from related parties, net of allowances, totaling $76.9 million. We recognized interest income of $2.1 million related to these notes receivables for the three months ending March 31, 2017.

 

The Company has various notes receivable from Unified Housing Foundation, Inc. (“UHF”) and Foundation for Better Housing, Inc. (“FBH”). UHF and FBH are determined to be related parties due to our reliance upon the performance of the collateral secured under the notes receivable. Payments are due from surplus cash flow of operations of the properties. A sale or refinance of any of the properties underlying these notes will be used to repay outstanding interest and principal for the remaining notes for the specific borrower. These notes are cross-collateralized for the specific borrower, but to the extent cash is received from a specific UHF or FBH property, it is applied first against any outstanding interest for the related-property note. The allowance on the UHF notes was a purchase allowance that was netted against the notes when acquired.