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REAL ESTATE OWNED, NET
 6 Months Ended
Jun. 30, 2016
Real Estate [Abstract]  
REAL ESTATE OWNED, NET
REAL ESTATE OWNED, NET

The following table presents the changes in REO for the three and six months ended June 30, 2016 and 2015 (in thousands):
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2016

 
2015

 
2016

 
2015

Balance, beginning of the period
$
7,207

 
$
4,922

 
$
11,627

 
$
3,352

Additions from loan foreclosures
376

 
1,473

 
378

 
2,141

Additions from acquisitions
—

 
—

 
400

 
2,525

Additions from capitalized costs
—

 
298

 
—

 
298

Proceeds from dispositions of REO
(1,656
)
 
(511
)
 
(6,322
)
 
(2,249
)
Gain on sale of REO
651

 
105

 
700

 
220

Valuation adjustments in the period
(431
)
 
(182
)
 
(636
)
 
(182
)
Balance, end of the period
$
6,147

 
$
6,105

 
$
6,147

 
$
6,105


 
 
 
 
 
 
 
 

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 June 30, 2016, the Company had $1.8 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 $878,000 at June 30, 2016.