Loans Receivable, Net (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of Accounts, Notes, Loans and Financing Receivable

Loans receivable, net, at December 31, 2019 and 2018 are summarized below.



	December 31,
	2019				2018
	Balance		% of Total Gross Loans		Balance		% of Total Gross Loans
Residential Real Estate Loans	$	86,404,304	18.4	%	$	83,965,416	18.9	%
Consumer Loans	56,331,013		12.0	%	56,907,555		12.8	%
Commercial Business Loans	22,234,189		4.8	%	28,086,686		6.3	%
Commercial Real Estate Loans	303,550,905		64.8	%	275,960,438		62.0	%
Total Loans Held For Investment	468,520,411		100.0	%	444,920,095		100.0	%
Loans Held For Sale	3,990,606				1,781,985
Total Loans Receivable, Gross	472,511,017				446,702,080
Less:
Allowance For Loan Losses	9,225,574				9,171,717
Loans in Process	9,957,140				7,225,271
Deferred Loan Fees	469,568				251,575
	19,652,282				16,648,563
Total Loans Receivable, Net	$	452,858,735			$	430,053,517

Financing Receivable Credit Quality Indicators

The following tables summarize the loan grades used by the Company to measure the credit quality of gross loans receivable, excluding those held for sale, by loan segment at December 31, 2019 and 2018.



December 31, 2019	Pass		Caution		Special Mention		Substandard		Total Loans
Residential Real Estate	$	76,674,539	$	4,612,182	$	1,155,802	$	3,961,781	$	86,404,304
Consumer	44,294,400		9,617,301		624,248		1,795,064		56,331,013
Commercial Business	16,140,592		5,486,393		301,462		305,742		22,234,189
Commercial Real Estate	230,810,756		56,025,352		14,285,015		2,429,782		303,550,905
Total	$	367,920,287	$	75,741,228	$	16,366,527	$	8,492,369	$	468,520,411



December 31, 2018	Pass		Caution		Special Mention		Substandard		Total Loans
Residential Real Estate	$	75,558,544	$	3,369,776	$	958,354	$	4,078,742	$	83,965,416
Consumer	46,948,251		6,899,912		567,682		2,491,710		56,907,555
Commercial Business	22,670,318		4,708,036		339,533		368,799		28,086,686
Commercial Real Estate	204,197,354		45,653,796		18,492,785		7,616,503		275,960,438
Total	$	349,374,467	$	60,631,520	$	20,358,354	$	14,555,754	$	444,920,095

Past Due Financing Receivables

The following tables present an age analysis of past due balances by category at December 31, 2019 and 2018.



	December 31, 2019
	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Total Past Due		Current		Total Loans Receivable
Residential Real Estate	$	—	$	355,290	$	144,209	$	499,499	$	85,904,805	$	86,404,304
Consumer	422,443		217,542		81,736		721,721		55,609,292		56,331,013
Commercial Business	147,959		76,515		20,316		244,790		21,989,399		22,234,189
Commercial Real Estate	3,849,424		—		1,352,716		5,202,140		298,348,765		303,550,905
Total	$	4,419,826	$	649,347	$	1,598,977	$	6,668,150	$	461,852,261	$	468,520,411



	December 31, 2018
	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Total Past Due		Current		Total Loans Receivable
Residential Real Estate	$	—	$	332,000	$	497,713	$	829,713	$	83,135,703	$	83,965,416
Consumer	555,798		247,894		1,120,462		1,924,154		54,983,401		56,907,555
Commercial Business	205,613		106,163		18,648		330,424		27,756,262		28,086,686
Commercial Real Estate	1,556,863		424,103		1,634,770		3,615,736		272,344,702		275,960,438
Total	$	2,318,274	$	1,110,160	$	3,271,593	$	6,700,027	$	438,220,068	$	444,920,095

Schedule of Financing Receivables, Non Accrual Status

The following table shows non-accrual loans by category at December 31, 2019 compared to 2018.



	December 31, 2019				December 31, 2018				Decrease
	Amount		Percent ⁽¹⁾		Amount		Percent ⁽¹⁾		$			%
Non-accrual Loans:
Residential Real Estate	$	1,520,485	0.3	%	$	2,084,870	0.5	%	$	(564,385	)	(27.1	)%
Consumer	319,280		0.1		1,274,673		0.3		(955,393		)	(75.0	)
Commercial Business	122,605		—		124,458		—		(1,853		)	(1.5	)
Commercial Real Estate	1,474,036		0.3		3,564,494		0.8		(2,090,458		)	(58.6	)
Total Non-accrual Loans	$	3,436,406	0.7	%	$	7,048,495	1.6	%	$	(3,612,089	)	(51.2	)%

^{(1) PERCENT OF GROSS LOANS RECEIVABLE HELD FOR INVESTMENT, NET OF DEFERRED FEES AND LOANS IN PROCESS.}

Schedule of Credit Losses Related to Financing Receivables, Current and Noncurrent

The following tables show the allowance for loan losses by loan category for the years ended December 31, 2019, 2018 and 2017.



	For the Year Ended December 31, 2019
	Residential Real Estate			Consumer			Commercial Business			Commercial Real Estate			Total
Beginning Balance	$	1,191,443		$	1,203,593		$	923,600		$	5,853,081		$	9,171,717
Provision	227,624			324,394			(392,817		)	215,799			375,000
Charge-Offs	(34,599		)	(432,003		)	(1,132		)	(517,583		)	(985,317		)
Recoveries	6,126			114,865			15,113			528,070			664,174
Ending Balance	$	1,390,594		$	1,210,849		$	544,764		$	6,079,367		$	9,225,574



	For the Year Ended December 31, 2018
	Residential Real Estate			Consumer			Commercial Business			Commercial Real Estate			Total
Beginning Balance	$	1,233,843		$	1,144,815		$	1,011,227		$	4,831,733		$	8,221,618
Provision	2,411			173,235			(55,109		)	804,463			925,000
Charge-Offs	(46,419		)	(224,954		)	(32,518		)	(351,894		)	(655,785		)
Recoveries	1,608			110,497			—			568,779			680,884
Ending Balance	$	1,191,443		$	1,203,593		$	923,600		$	5,853,081		$	9,171,717



	For the Year Ended December 31, 2017
	Residential Real Estate			Consumer			Commercial Business			Commercial Real Estate			Total
Beginning Balance	$	1,360,346		$	996,620		$	882,999		$	5,116,266		$	8,356,231
Provision	82,909			257,180			261,599			(301,688		)	300,000
Charge-Offs	(211,780		)	(184,161		)	(133,371		)	(301,260		)	(830,572		)
Recoveries	2,368			75,176			—			318,415			395,959
Ending Balance	$	1,233,843		$	1,144,815		$	1,011,227		$	4,831,733		$	8,221,618

Allowance for Credit Losses on Financing Receivables

The following tables summarize the impaired loans evaluated individually and collectively for impairment within the allowance for loan losses and loans receivable balances at December 31, 2019 and 2018.



	Allowance For Loan Losses						Loans Receivable
December 31, 2019	Individually Evaluated For Impairment		Collectively Evaluated For Impairment		Total		Individually Evaluated For Impairment		Collectively Evaluated For Impairment		Total
Residential Real Estate	$	—	$	1,390,594	$	1,390,594	1,086,433		$	85,317,871	$	86,404,304
Consumer	—		1,210,849		1,210,849		184,402		56,146,611		56,331,013
Commercial Business	—		544,764		544,764		64,406		22,169,783		22,234,189
Commercial Real Estate	—		6,079,367		6,079,367		1,894,642		301,656,263		303,550,905
Total	$	—	$	9,225,574	$	9,225,574	$	3,229,883	$	465,290,528	$	468,520,411

(4) Loans Receivable, Net, Continued

Impaired Financing Receivables

The following tables present information related to impaired loans by loan category as of and for the years ended December 31, 2019, 2018 and 2017.



	December 31, 2019
Impaired Loans	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With No Related Allowance Recorded:
Residential Real Estate	$	1,086,433	$	1,086,433	$	—	$	1,322,609	$	—
Consumer	184,402		192,702		—		1,106,795		—
Commercial Business	64,406		959,406		—		71,422		—
Commercial Real Estate	1,894,642		2,066,862		—		3,893,786		54,372
Total
Residential Real Estate	1,086,433		1,086,433		—		1,322,609		—
Consumer	184,402		192,702		—		1,106,795		—
Commercial Business	64,406		959,406		—		71,422		—
Commercial Real Estate	1,894,642		2,066,862		—		3,893,786		54,372
Total	$	3,229,883	$	4,305,403	$	—	$	6,394,612	$	54,372

(4) Loans Receivable, Net, Continued



	December 31, 2018
Impaired Loans	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With No Related Allowance Recorded:
Residential Real Estate	$	1,700,861	$	1,700,861	$	—	$	1,743,906	$	31,853
Consumer	986,380		994,680		—		502,479		—
Commercial Business	77,206		972,206		—		85,020		—
Commercial Real Estate	5,084,458		6,116,761		—		8,052,817		212,186
With an Allowance Recorded:
Consumer	73,662		73,662		73,662		6,139		—
Commercial Real Estate	1,441,558		1,441,558		665,000		636,387		84,881
Total
Residential Real Estate	1,700,861		1,700,861		—		1,743,906		31,853
Consumer	1,060,042		1,068,342		73,662		508,618		—
Commercial Business	77,206		972,206		—		85,020		—
Commercial Real Estate	6,526,016		7,558,319		665,000		8,689,204		297,067
Total	$	9,364,125	$	11,299,728	$	738,662	$	11,026,748	$	328,920



	December 31, 2017
Impaired Loans	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With No Related Allowance Recorded:
Residential Real Estate	$	1,883,741	$	2,333,741	$	—	$	2,889,065	$	24,273
Consumer	181,617		209,427		—		279,183		—
Commercial Business	100,401		950,401		—		141,940		—
Commercial Real Estate	6,276,547		7,583,847		—		7,483,035		189,373
Total
Residential Real Estate	1,883,741		2,333,741		—		2,889,065		24,273
Consumer	181,617		209,427		—		279,183		—
Commercial Business	100,401		950,401		—		141,940		—
Commercial Real Estate	6,276,547		7,583,847		—		7,483,035		189,373
Total	$	8,442,306	$	11,077,416	$	—	$	10,793,223	$	213,646

Troubled Debt Restructurings on Financing Receivables

In the course of resolving delinquent loans, the Bank may choose to restructure the contractual terms of certain loans. A troubled debt restructuring ("TDR") is a restructuring in which the Bank, for economic or legal reasons related to a borrower’s financial difficulties, grants a concession to a borrower that it would not otherwise consider (FASB ASC Topic 310-40). The concessions granted on TDRs generally include terms to reduce the interest rate, extend the term of the debt obligation, or modify the payment structure on the debt obligation. The Bank grants such concessions to reassess the borrower’s financial status and develop a plan for repayment.

At the date of modification, TDRs are initially classified as nonaccrual TDRs. They are returned to accruing status when there is economic substance to the restructuring, there is documented credit evaluation of the borrower's financial condition, the remaining balance is reasonably assured of repayment in accordance with its modified terms, and the borrower has demonstrated sustained repayment performance in accordance with the modified terms for a reasonable period of time (generally a minimum of six months).

The Bank had five TDRs with a total balance of $825,000 included in impaired loans at December 31, 2019 compared to seven TDRs totaling $1.4 million at December 31, 2018. There were no TDRs restructured during the years ended December 31, 2019, 2018 and 2017. At December 31, 2019, there were no TDRs in default. At December 31, 2018 and 2017, one previously restructured loan with a balance of $374,000 and two previously restructured loans with a total balance of $610,000, respectively, were in default, none of which had been restructured during the same period. The Bank considers any loan 30 days or more past due to be in default.