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REAL ESTATE OWNED, NET
 3 Months Ended
Mar. 31, 2016
Real Estate [Abstract]  
REAL ESTATE OWNED, NET
REAL ESTATE OWNED, NET

The following table presents the changes in REO for the three months ended March 31, 2016 and 2015 (in thousands):
 
Three Months Ended
March 31,
 
2016

 
2015

Balance, beginning of the period
$
11,627

 
$
3,352

Additions from loan foreclosures
2

 
668

Additions from acquisitions
400

 
2,525

Proceeds from dispositions of REO
(4,666
)
 
(1,738
)
Gain on sale of REO
49

 
115

Valuation adjustments in the period
(205
)
 
—

Balance, end of the period
$
7,207

 
$
4,922


 
 
 
 
 
 
 
 

REO properties are recorded at the estimated fair value of the property, less expected selling costs, establishing a new cost basis.  Subsequently, REO properties are carried at the lower of the new cost basis or updated fair market values, based on updated appraisals of the underlying properties, as received.  Valuation allowances on the carrying value of REO may be recognized based on updated appraisals or on management’s authorization to reduce the selling price of a property. At March 31, 2016, the Company had $2.7 million of foreclosed one- to four-family residential real estate properties held as REO. The recorded investment in one- to four-family residential loans in the process of foreclosure was $2.8 million at March 31, 2016.