Genesis Financial 10-Q 13 May 16 2016 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2016	May. 06, 2016
Document and Entity Information
Entity Registrant Name	Genesis Financial Inc
Document Type	10-Q
Document Period End Date	Mar. 31, 2016
Amendment Flag	false
Entity Central Index Key	1,183,082
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		17,023,870
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q1
Entity Incorporation, State Country Name	Wyoming
Trading Symbol	gfnl
Entity Incorporation, Date of Incorporation	Jan. 24, 2002

GENESIS FINANCIAL, INC. Balance

GENESIS FINANCIAL, INC. Balance Sheets (Interim period unaudited) - USD ($)		Mar. 31, 2016	Dec. 31, 2015
CURRENT ASSETS:
Cash and cash equivalents		$ 73,199	$ 31,301
Interest and other receivables		74,514	70,909
Investments in real estate limited liability companies		267,206	270,303
Loans held for sale		403,761	503,890
Real estate owned		27,451	27,451
Total current assets		846,131	903,854
NON-CURRENT ASSETS:
Long-term investments		362,619	362,619
Investments - available for sale		13,285	26,570
Real estate leasehold interest, net of accumulated amortization of $55,046 and $49,885, respectively		219,904	225,065
Rental Property, net of accumulated depreciation of $5,267 and $4,733, respectively		79,193	79,729
Office equipment, net of accumulated depreciation of $6,246 and $5,905, respectively		1,686	2,027
Total non-current assets		676,687	696,010
Total assets		1,522,818	1,599,864
CURRENT LIABILITIES:
Line of credit, affiliated company		1,260,000	1,260,000
Line of credit, bank			170,000
Note payable		29,658	30,034
Other current liabilities		6,646	13,040
Total current liabilities		$ 1,296,304	1,473,074
LONG-TERM LIABILITIES:
Convertible note payable to officer			$ 250,000
COMMITMENT AND CONTINGENCIES	[1]
STOCKHOLDERS' EQUITY:
Common stock, $.001 par value; 100,000,000 authorized, 16,923,870 and 16,198,870 issued and outstanding, respectively		$ 16,924	$ 16,199
Additional paid-in capital		8,542,412	8,264,137
Accumulated deficit		(7,846,107)	(7,930,116)
Accumulated other comprehensive income (loss)		(486,715)	(473,430)
Total stockholders' equity		226,514	(123,210)
Total liabilities and stockholders' equity		$ 1,522,818	$ 1,599,864
[1]	Note 6

Statement of Financial Position

Statement of Financial Position - Parenthetical - USD ($)	Mar. 31, 2016	Dec. 31, 2015
Statement of financial position
Preferred Stock, Par Value	$ 1	$ 1
Preferred Stock, Shares Authorized	2,290,000	2,290,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0
Common Stock, Par Value	$ 0.001	$ 0.001
Common Stock, Shares Authorized	100,000,000	100,000,000
Common Stock, Shares Issued	16,923,870	16,198,870
Common Stock, Shares Outstanding	16,923,870	16,198,870
Accumulated depreciation, equipment	$ 6,246	$ 5,905
Accumulated amortization, real estate leasehold interest	55,046	49,885
Accumulated depreciation, rental property	$ 5,267	$ 4,733

GENESIS FINANCIAL, INC. Condens

GENESIS FINANCIAL, INC. Condensed Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
REVENUE:
Interest, processing fees and other income	$ 19,530	$ 19,214
Rental income	5,500	16,500
Total revenues	25,030	35,714
EXPENSES:
Loss (income) on investment in real estate LLC	(138,111)	(48)
(Gain) on sale of loan	(21,258)
Salaries	12,750	12,750
Interest expense, related party	2,155	5,041
Interest expense, other	1,536	1,875
Financing expense, related party	29,000
Depreciation	877	877
Amortization	5,161	5,161
Rental Property expense	2,109	9,122
Office occupancy and other	46,802	34,423
Total operating (income) expenses	(58,979)	69,201
NET INCOME (LOSS)	84,009	(33,487)
COMPREHENSIVE INCOME (LOSS):
Unrealized loss on available for sale securities	(13,285)	(147,608)
COMPREHENSIVE INCOME (LOSS)	$ 70,724	$ (181,095)
BASIC AND DILUTED EARNINGS (LOSS) PER SHARE	$ 0.01	$ 0
WEIGHTED AVERAGE SHARES BASIC AND DILUTED	16,613,156	12,078,176

GENESIS FINANCIAL, INC. Conden5

GENESIS FINANCIAL, INC. Condensed Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Statement of cash flows
CASH FLOWS FROM OPERATING ACTIVITIES	$ (177,660)	$ (24,457)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of real estate limited liability company	389,934
Net cash provided by investing activities	389,934
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings (repayment) line of credit with affiliated company, net		(15,000)
Borrowings (repayment) from line of credit from bank, net	(170,000)	40,000
Payments on notes payable	(376)	(1,599)
Net cash provided (used) by financing activities	(170,376)	23,401
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	41,898	(1,056)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	31,301	64,493
CASH AND CASH EQUIVALENTS AT END OF PERIOD	73,199	63,437
NONCASH INVESTING AND FINANCING TRANSACTIONS
Convertible note payable to officer converted to common stock	$ 250,000
Preferred stock converted to common stock		10,000
Convertible note receivable settled with investment		$ 150,000

Note 1 - Organization and Summa

Note 1 - Organization and Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2016
Notes
Note 1 - Organization and Summary of Significant Accounting Policies:	NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Organization: Genesis Financial, Inc. (“the Company” or “GFI”) was incorporated in Washington State on January 24, 2002 and on January 26, 2016 we moved our corporate domicile to the State of Wyoming. The Company is primarily engaged in the business of purchasing and selling real estate receivable loans and periodically providing bridge capital funding. Loans consist of real estate loans and mortgage notes collateralized by primarily first position liens on residential and commercial real estate. The loans collateralized by real estate are typically non-conventional either because they are originated as a result of seller financing, or the underlying property is non-conventional. The Company invests in loans using investor funds, equity funds and funds generated from external borrowings including a line of credit facility from an affiliated stockholder. Summary of Significant Accounting Policies: Use of estimates Fair value measurements - 1. the fair value measurement; 2. the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets or liabilities (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3); 3. for fair value measurements using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: a. total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earnings are reported in the statement of operations; b. the amount of these gains or losses attributable to the change in unrealized gains or losses relating to those assets or liabilities still held at the reporting period date and a description of where those unrealized gains or losses are reported; c. purchases, sales, issuances, and settlements (net); and d. transfers into and/or out of Level 3. 4. the amount of the total gains or losses for the period in (3)(a) included in earnings that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date and a description of where those unrealized gains or losses are reported in the statement of operations; and 5. in annual periods only, the valuation technique(s) used to measure fair value and a discussion of changes in valuation techniques, if any, during the period. Real estate leasehold interest – Loans held for sale – Real estate owned – Income tax Earnings per share March 31, 2016 2015 Stock options 261,000 261,000 Convertible preferred stock - 4,098,750 Convertible debt - 625,000 Total possible dilution 261,000 4,984,750 Reclassifications

Note 2 - Loans Held For Sale an

Note 2 - Loans Held For Sale and Convertible Note	3 Months Ended
	Mar. 31, 2016
Notes
Note 2 - Loans Held For Sale and Convertible Note:	NOTE 2 — LOANS HELD FOR SALE AND CONVERTIBLE NOTE: The Company's fair value of loans held for sale and convertible notes consisted of the following: March 31, 2016 December 31, 2015 Residential $ 151,788 $ 253,853 Other 10,000 10,000 Commercial 241,973 240,037 Loans held for sale - Total $ 403,761 $ 503,890 The following table presents a reconciliation of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the quarters ended March 31, 2016 and 2015: March 31, 2016 2015 Beginning Balance $ 503,890 $ 611,400 Principal payments received (1,464) (1,529) Proceeds from sale of loans (120,000) - Gain on sale of loan 21,258 - Repossession expenses 77 (858) Ending Balance $ 403,761 $ 610,729 During the quarter ended March 31, 2016, the Company sold one loans with a basis of $98,742 for $120,000 in cash. A gain of $21,258 was recognized.

Note 3- Real Estate Owned

Note 3- Real Estate Owned	3 Months Ended
	Mar. 31, 2016
Notes
Note 3- Real Estate Owned:	NOTE 3- REAL ESTATE OWNED: The Company's REO consisted of the following: March 31, 2016 December 31, 2015 Land $ 23,441 $ 23,441 Commercial 4,010 4,010 Total $ 27,451 $ 27,451

Note 4 - Other Assets

Note 4 - Other Assets	3 Months Ended
	Mar. 31, 2016
Notes
Note 4 - Other Assets	NOTE 4 — OTHER ASSETS: Long term investments: Flyback Energy, Inc.: In December 2015, the Company reduced the carrying value of its Flyback Energy common shares to $0.067 per share, or $212,619, and recorded an impairment change of $1,037,381 based on the last known common share sale. Flyback Energy, Inc. is still a development stage company being financed by outside sources of capital. At this time, Flyback is not assured of future financing capital and is subject to changing world conditions. Digi Outdoor Media, Inc.: In 2014, the Company loaned Placer Creek Mining Company (“Placer”) $150,000. The loan interest rate is 5.0% and the Company has an option to convert any or all of the amount due into an equity private placement of Placer. The Placer transaction is treated as a related party transaction. (See Note 8: Michael Lavigne) On February 24, 2015, the Company converted the loan into 300,000 shares of common stock of Digi Outdoor Media, Inc. (“Digi”), the successor in interest to Placer. The Company determined that the fair value of the shares received on the conversion to be $150,000 based upon the loan balance of $150,000 because Digi is not publicly traded and has had no recent cash sale of its common stock. The fair value was determined using Level 2 inputs under the fair value hierarchy. Digi Outdoor Media, Inc. is a startup company in the business of building and leasing outdoor advertising signs. Investments in Available for Sale Securities: Ambient Water Corporation (Formerly AWG International Water Corp.): The Company purchased 109,906 shares of the AWG International Water Corp, a Nevada corporation, (“AWGI”) common stock for $500,000 ($250,000 each in 2010 and 2011). In July 2012, AWGI was acquired by MIP Solutions, Inc. in a share exchange transaction (the "Acquisition"). In connection with the Acquisition, the Company’s 109,906 shares of AWGI common stock were converted into 7,380,433 shares of AWG International Water Corp (formerly MIP Solutions, Inc.). At March 31, 2016 the quoted market value of AWGI was $0.0018 per share, or $13,285, resulting in an unrealized loss of $13,285 for the quarter ended March 31, 2016. Total unrealized loss on AWGI is $486,715 as of March 31, 2016. The investment is measured using Level 1 fair value inputs. Management has concluded that the unrealized loss is not other-than-temporary because the common stock price per share has only been less than the Company’s cost basis for a short period of time. Investments in Real Estate Limited Liability Companies: At the end of 2012, the Company acquired investments in two Washington state real estate limited liability companies for $225,000. In 2013, the Company contributed its investment in one real estate owned property with a basis of $51,600 to a newly formed limited liability company in exchange for a 12.9% interest in the new company. In 2014, the Company contributed its investment in one real estate owned property with a basis of $47,925 to a newly formed limited liability company in exchange for 31.95% interest in the new company. These companies are 100% controlled and managed by Genesis Finance Corporation and John Coghlan, related parties. (See Note 8) Investments are accounted for using the equity method. During the quarters ended March 31, 2016 and 2015, the Company recorded (income) loss of $(138,111) and ($48), respectively. Losses generally represent our portion of this real estate company’s loss for the same period. During the quarter ended March 31, 2016 one limited liability company was sold for $399,934 resulting in a gain of $139,821. Rental Properties: At the end of 2013, the Company foreclosed on a loan previously held for sale in Lebanon, Oregon through the bankruptcy courts, and is accounting for the company’s carrying value of $85,534 as a rental property. The property was subsequently leased on a three year lease agreement for $1,500 per month. During the quarter ended March 31, 2016 and 2015, the company recognized $4,500 in rental income. This is a commercial building being depreciated over thirty-nine (39) years. The company recorded depreciation of $536 for the quarters ended March 31, 2016 and 2015. Real Estate Leasehold Interest: On May 31, 2013, the Company completed the acquisition of a real property leasehold interest in approximately 63 acres with fifty (50) RV/residential lots located in Dunn County, North Dakota, (the "Halliday Project"). Total consideration for the leasehold interest was $619,250. The Company may place recreational vehicles, mobile homes, or construct cabins on the lots and offer them for rent or lease. In 2015 the Company purchased two travel trailers for $30,000 from JC Housing, LLC, a related party (see Note 8). The Company recorded amortization of $5,161 for the quarters ended March 31, 2016 and 2015, respectively. At March 31, 2016 and 2015, the Company had none and thirteen lots leased and had rental income for the three month ended March 31, 2016 and 2015 of $1,000 and $12,000, respectively. The lease consists of approximately 63 acres in the city of Halliday, North Dakota. The lease term is fifteen years and commenced on September 15, 2012. The Company has an option to renew the lease for an additional fifteen year term. The monthly rent on the lease is Fifty ($50.00) Dollars for each occupied and rented trailer, cabin or lot. The Company is obligated to pay any and all real and personal property taxes, general taxes, special assessments and other charges levied against the property and its improvements. During the lease term, the Company will own title to all of the improvements and personal property. At the expiration of the lease or termination, all improvements and personal property located on the premises will revert to the Lessors. At December 31, 2015, the Company decided to adjust the carrying value of the property to a fair value estimated of $195,065 (not including travel trailers), based on management’s estimate of discounted cash flows received from the property.

Note 5 - Lines of Credit

Note 5 - Lines of Credit	3 Months Ended
	Mar. 31, 2016
Notes
Note 5 - Lines of Credit	NOTE 5 — LINES OF CREDIT: GFI has a $250,000 line of credit with Riverbank. At March 31, 2016 and December 31, 2015 the balance owing is $0 and $170,000. The line has a term of twelve months, and an origination fee of 1/2%, or $1,250. Accrued interest is paid monthly. The Riverbank line of credit is senior to the Coghlan Family Corporation, Inc. (“CFC”) line of credit and is collateralized by the assets of GFI. On June 30, 2015 the line of credit was extended to July 1, 2016 at which time the loan renewed at a four and a half (4.5%) percent interest rate with a renewal fee of ½%, or $1,250. The Riverbank line requires that the CFC line may not be paid down lower than the amount owing to Riverbank at any time during the term of the loan. The line is payable on demand and is personally guaranteed by John R. and Wendy Coghlan, related parties of the Company. The Company has a $2,500,000 Warehouse Line of Credit Promissory Note Agreement with the CFC. At March 31, 2016 and December 31, 2015 the balance owing was $1,260,000 . CFC is an affiliated company controlled by John R. Coghlan. At the time the agreement was made the default interest rate was twelve (12%) percent. Interest was payable monthly. The line had a term of 12 months and an origination fee of 1/2% or $12,500. The credit line is collateralized by all of GFI’s assets and is subordinate to the Riverbank line of credit. The line of credit agreement requires that the Company maintain a debt to equity ratio of no greater than 3.0. Borrowings under the line are personally guaranteed by Michael A. Kirk, the Secretary of the Company. Because of the economic conditions, CFC agreed to waive the interest and origination fees starting October 1, 2010 and also agreed to waive the 3.0 debt to equity ratio requirement as well as the 12% default rate. This waiver agreement is still in effect at March 31, 2016. (See 8-K filed February 8, 2016)

Note 6 - Notes Payable

Note 6 - Notes Payable	3 Months Ended
	Mar. 31, 2016
Notes
Note 6 - Notes Payable	NOTE 6 — NOTES PAYABLE: Convertible Note Payable to Officer On December 15, 2010, the Company entered into a convertible note agreement for $250,000 with John R. Coghlan, a related party (see Note 8). The note accrues interest at eight (8%) percent per annum with interest and balance initially due on December 15, 2012. The note is convertible at any time by Mr. Coghlan into one (1) share of the Company’s Series “B” Preferred stock for every $1.00 outstanding of the note payable and related accrued interest. In connection with the issuance of this note, the Company recognized a beneficial conversion feature of $128,750 that resulted in a discount to the note payable. The discount was amortized into earnings over the initial term of the note and was fully amortized at December 31, 2012. The note is collateralized by 290,000 shares of the Company’s Series “B” Preferred stock. On October 16, 2012, the Company and Coghlan agreed to extend the due date of the note to December 15, 2016. On February 8, 2016, Mr. Coghlan elected to convert his note into shares of the Company’s common stock. The note was originally convertible into 250,000 shares of Series "B", or 625,000 shares of common stock equivalents, at the option of Mr. Coghlan. However, Mr. Coghlan agreed to accept 725,000 common shares in lieu of full payment. The 100,000 additional common shares represents a financing cost to the Company and as such, financing expense of $29,000 was recognized in the quarter ended March 31, 2016. Note Payable: In 2013, the Company assumed a note payable totaling $62,699 relating to a loan it had made in 2005. When the Company funded the loan in 2005, it sold 100% of its interest to various investors. During 2013, the Company began foreclosure proceedings on behalf of the investors because the borrower was delinquent on payments. During the proceedings, it was determined that the Company had failed to obtain first position in the underlying property and that a separate creditor was in first position. To uphold its agreement with the investors, the Company assumed the balance of the note with the creditor and recognized a loss for the entire amount in 2013. The term of the assumed note is 9.5% until paid in full and monthly payments are $832. At March 31, 2016, the balance owing is $29,658.

Note 7 - Series "B" Preferred S

Note 7 - Series "B" Preferred Stock	3 Months Ended
	Mar. 31, 2016
Notes
Note 7 - Series "B" Preferred Stock	NOTE 7 — SERIES B PREFERRED STOCK: On November 11, 2010 the Company filed Articles of Amendment to the Amended and Restated Articles of Incorporation creating 2,000,000 shares of Series B Preferred Stock. The designated Series B Preferred Stock consists of 2,000,000 shares with a par value $1.00; is non-dividend bearing, convertible to Common Stock at $.40 per share subject to any recapitalization. The Company subsequently amended the share amount to 2,290,000. The holders of the Preferred Stock will be entitled to receive, prior and in preference to any Distributions of any assets of the Corporation to the holders of the Common Stock. Each share of the Preferred Stock is convertible into two and one-half common stock shares at the option of the holder. Each share of Series B Preferred Stock can be automatically converted immediately prior to the closing of a firm commitment underwritten initial public offering pursuant to an effective registration statement filed under the Securities Act of 1933 or upon the receipt by the Corporation of a written request for such request for such conversion from the holders of the majority of the Series B Preferred Stock holders. On May 18, 2015, the Company by majority consent of Preferred Shareholder agreed to convert all of the outstanding shares of Series B Preferred to common stock. On June 26, 2015, 1,649,500 shares of Series B Preferred were converted into 4,123,750 common shares. As of March 31, 2016 and December 31, 2015, no shares of Series B Preferred Stock are issued, outstanding or obligated.

Note 8- Related-party Transacti

Note 8- Related-party Transactions	3 Months Ended
	Mar. 31, 2016
Notes
Note 8- Related-party Transactions	NOTE 8— RELATED-PARTY TRANSACTIONS: Related parties are defined as Officers, Directors, and/or those Shareholders owning or controlling more than 5% of the common stock of GFI, or any entities that are owned or controlled by Officers, Directors, and/or those Shareholders owning or controlling more than 5% of the common stock of GFI. Coghlan Family Corporation, Coghlan, LLC and West 3773 Fifth, LLC are controlled by John R. Coghlan, a Company director, CFO and majority shareholder. Coghlan Family Corporation is owned 100% by Coghlan, LLC, which is owned by the Coghlan family members. John R. and Wendy Coghlan (husband and wife) collectively own 35.65% of Coghlan, LLC and are co-managers. West 3773 Fifth, LLC is owned 100% by John and Wendy Coghlan (husband and wife). JC Housing, LLC is owned 33.33% by John R. Coghlan and 33.33% by Clint Lohman. Mr. Lohman is a director of GFI. Genesis Financial Corporation is a company which is owned 100% by Michael Kirk, who is a director and officer of GFI. GFI provides accounting, office services and supplies, and office space for his services provided to Genesis Financial Corporation. The services are valued at $1,500 per month. Genesis Finance Corporation and John R. Coghlan has managing agreement with the real estate limited liability companies. Michael Lavigne is an officer and director of Placer Creek Mining Company. Mr. Lavigne is a director of GFI. In addition to transactions described in Notes 4, 5 and 6, Genesis Financial, Inc. had the following related party transactions for the quarters ended March 31, 2016 and year ended December 31, 2015. John R. Coghlan On June 30, 2015, John R. Coghlan personally guaranteed our Riverbank line of credit. As of March 31, 2016, the Company continues a managing agreement for the investment in real estate limited liability companies. The agreement is stated in the operating agreement of each limited liability companies. On February 8, 2016, John R. Coghlan converted his $250,000 note for 725,000 shares of common stock. (See Note 7) Coghlan Family Corporation “CFC” There was no activity for the year ending December 31, 2015. In February 2016, Coghlan Family Corporation amended the Warehouse Line of Credit. (See Note 5) Coghlan, LLC There was no activity for the years ending December 31, 2015 and quarter ended March 31, 2016. JC Housing, LLC For the year ended December 31, 2015, the Company purchased two travel trailers from JC Housing, LLC for $30,000. West 3773 Fifth, LLC As of March 31, 2016, the Company continues a month-to-month tenancy with monthly rent of $1,250. Genesis Finance Corporation “GFC” As of March 31, 2016, the Company continues a managing agreement for the investment in real estate limited liability companies. The agreement is stated in the operating agreement of each limited liability companies. Michael Lavigne, Director For the year ended December 31, 2015, the Company converted the Placer Creek Mining Company loan of $150,000 to 300,000 shares of Digi Outdoor Media, Inc., the successor to Placer Creek Mining Company. (See Note 4) There was no activity for the quarter ended March 31, 2016. Clint Lohman, Director There was no activity for the quarter ended March 31, 2016.

Noe 9 - Subsequent Events

Noe 9 - Subsequent Events	3 Months Ended
	Mar. 31, 2016
Notes
Noe 9 - Subsequent Events	NOTE 9— SUBSEQUENT ENVENT: On April 12, 2016, the Company granted 100,000 restricted common stock shares to Virginia Walters, executive officer for services. The stock was valued at the bid price of the stock on April 12, 2016, the date of issuance which was $0.15 per share.

Note 1 - Organization and Sum15

Note 1 - Organization and Summary of Significant Accounting Policies: Use of Estimates (Policies)	3 Months Ended
	Mar. 31, 2016
Policies
Use of Estimates	Use of estimates

Note 1 - Organization and Sum16

Note 1 - Organization and Summary of Significant Accounting Policies: Fair Value Measurements (Policies)	3 Months Ended
	Mar. 31, 2016
Policies
Fair Value Measurements	Fair value measurements - 1. the fair value measurement; 2. the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets or liabilities (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3); 3. for fair value measurements using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: a. total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earnings are reported in the statement of operations; b. the amount of these gains or losses attributable to the change in unrealized gains or losses relating to those assets or liabilities still held at the reporting period date and a description of where those unrealized gains or losses are reported; c. purchases, sales, issuances, and settlements (net); and d. transfers into and/or out of Level 3. 4. the amount of the total gains or losses for the period in (3)(a) included in earnings that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date and a description of where those unrealized gains or losses are reported in the statement of operations; and 5. in annual periods only, the valuation technique(s) used to measure fair value and a discussion of changes in valuation techniques, if any, during the period.

Note 1 - Organization and Sum17

Note 1 - Organization and Summary of Significant Accounting Policies: Real Estate, Policy (Policies)	3 Months Ended
	Mar. 31, 2016
Policies
Real Estate, Policy	Real estate leasehold interest –

Note 1 - Organization and Sum18

Note 1 - Organization and Summary of Significant Accounting Policies: Loans held for sale (Policies)	3 Months Ended
	Mar. 31, 2016
Policies
Loans held for sale	Loans held for sale –

Note 1 - Organization and Sum19

Note 1 - Organization and Summary of Significant Accounting Policies: Real estate owned (Policies)	3 Months Ended
	Mar. 31, 2016
Policies
Real estate owned	Real estate owned –

Note 1 - Organization and Sum20

Note 1 - Organization and Summary of Significant Accounting Policies: Income tax (Policies)	3 Months Ended
	Mar. 31, 2016
Policies
Income tax	Income tax

Note 1 - Organization and Sum21

Note 1 - Organization and Summary of Significant Accounting Policies: Earnings Per Share, Policy (Policies)	3 Months Ended
	Mar. 31, 2016
Policies
Earnings Per Share, Policy	Earnings per share March 31, 2016 2015 Stock options 261,000 261,000 Convertible preferred stock - 4,098,750 Convertible debt - 625,000 Total possible dilution 261,000 4,984,750

Note 1 - Organization and Sum22

Note 1 - Organization and Summary of Significant Accounting Policies: Reclassifications (Policies)	3 Months Ended
	Mar. 31, 2016
Policies
Reclassifications	Reclassifications

Note 1 - Organization and Sum23

Note 1 - Organization and Summary of Significant Accounting Policies: Earnings Per Share, Policy: Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Tables)	3 Months Ended
	Mar. 31, 2016
Tables/Schedules
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	March 31, 2016 2015 Stock options 261,000 261,000 Convertible preferred stock - 4,098,750 Convertible debt - 625,000 Total possible dilution 261,000 4,984,750

Note 2 - Loans Held For Sale 24

Note 2 - Loans Held For Sale and Convertible Note: Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Tables)	3 Months Ended
	Mar. 31, 2016
Tables/Schedules
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis	March 31, 2016 2015 Beginning Balance $ 503,890 $ 611,400 Principal payments received (1,464) (1,529) Proceeds from sale of loans (120,000) - Gain on sale of loan 21,258 - Repossession expenses 77 (858) Ending Balance $ 403,761 $ 610,729

Note 3- Real Estate Owned_ Real

Note 3- Real Estate Owned: Real Estate Owned, Disclosure of Detailed Components (Tables)	3 Months Ended
	Mar. 31, 2016
Tables/Schedules
Real Estate Owned, Disclosure of Detailed Components	March 31, 2016 December 31, 2015 Land $ 23,441 $ 23,441 Commercial 4,010 4,010 Total $ 27,451 $ 27,451

Note 1 - Organization and Sum26

Note 1 - Organization and Summary of Significant Accounting Policies (Details)	3 Months Ended
	Mar. 31, 2016
Details
Nature of Operations	Organization: Genesis Financial, Inc. (“the Company” or “GFI”) was incorporated in Washington State on January 24, 2002 and on January 26, 2016 we moved our corporate domicile to the State of Wyoming. The Company is primarily engaged in the business of purchasing and selling real estate receivable loans and periodically providing bridge capital funding. Loans consist of real estate loans and mortgage notes collateralized by primarily first position liens on residential and commercial real estate. The loans collateralized by real estate are typically non-conventional either because they are originated as a result of seller financing, or the underlying property is non-conventional. The Company invests in loans using investor funds, equity funds and funds generated from external borrowings including a line of credit facility from an affiliated stockholder.
Entity Incorporation, Date of Incorporation	Jan. 24, 2002
Entity Incorporation, State Country Name	Wyoming

Note 1 - Organization and Sum27

Note 1 - Organization and Summary of Significant Accounting Policies: Earnings Per Share, Policy: Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Details
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements	261,000	261,000
Incremental Common Shares Attributable to Dilutive Effect of Conversion of Preferred Stock		4,098,750
Incremental Common Shares Attributable to Dilutive Effect of Conversion of Debt Securities		625,000
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	261,000	4,984,750

Note 2 - Loans Held For Sale 28

Note 2 - Loans Held For Sale and Convertible Note (Details) - USD ($)	Mar. 31, 2016	Dec. 31, 2015
Details
Loans and Leases Receivable, Gross, Consumer, Real Estate	$ 151,788	$ 253,853
Loans and Leases Receivable, Gross, Other	10,000	10,000
Loans and Leases Receivable, Gross, Commercial	241,973	240,037
Loans held for sale	$ 403,761	$ 503,890

Note 2 - Loans Held For Sale 29

Note 2 - Loans Held For Sale and Convertible Note: Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Details) - USD ($)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Details
Fair Value Assets Liabilities Measured On Recurring Basis Beginning Balance	$ 503,890	$ 611,400
Debt Instrument, Periodic Payment, Principal	(1,464)	(1,529)
Proceeds from Sales of Assets, Investing Activities	(120,000)
(Gain) on sale of loan	21,258
Foreclosed Real Estate Expense	77	(858)
Fair Value, Assets and Liabilities Measured on Recurring Basis, Gain (Loss) Included in Earnings	$ 403,761	$ 610,729

Note 3- Real Estate Owned_ Re30

Note 3- Real Estate Owned: Real Estate Owned, Disclosure of Detailed Components (Details) - USD ($)	Mar. 31, 2016	Dec. 31, 2015
Details
Land	$ 23,441	$ 23,441
Commercial	4,010	4,010
Property Subject to or Available for Operating Lease, Net	$ 27,451	$ 27,451

Note 4 - Other Assets (Details)

Note 4 - Other Assets (Details) - USD ($)	Feb. 24, 2015	Mar. 31, 2016
Marketable Securities		Investments in Available for Sale Securities: Ambient Water Corporation (Formerly AWG International Water Corp.): The Company purchased 109,906 shares of the AWG International Water Corp, a Nevada corporation, (“AWGI”) common stock for $500,000 ($250,000 each in 2010 and 2011). In July 2012, AWGI was acquired by MIP Solutions, Inc. in a share exchange transaction (the "Acquisition"). In connection with the Acquisition, the Company’s 109,906 shares of AWGI common stock were converted into 7,380,433 shares of AWG International Water Corp (formerly MIP Solutions, Inc.). At March 31, 2016 the quoted market value of AWGI was $0.0018 per share, or $13,285, resulting in an unrealized loss of $13,285 for the quarter ended March 31, 2016. Total unrealized loss on AWGI is $486,715 as of March 31, 2016. The investment is measured using Level 1 fair value inputs. Management has concluded that the unrealized loss is not other-than-temporary because the common stock price per share has only been less than the Company’s cost basis for a short period of time.
Investment Holdings, Other than Securities		Investments in Real Estate Limited Liability Companies: At the end of 2012, the Company acquired investments in two Washington state real estate limited liability companies for $225,000. In 2013, the Company contributed its investment in one real estate owned property with a basis of $51,600 to a newly formed limited liability company in exchange for a 12.9% interest in the new company. In 2014, the Company contributed its investment in one real estate owned property with a basis of $47,925 to a newly formed limited liability company in exchange for 31.95% interest in the new company. These companies are 100% controlled and managed by Genesis Finance Corporation and John Coghlan, related parties. (See Note 8) Investments are accounted for using the equity method. During the quarters ended March 31, 2016 and 2015, the Company recorded (income) loss of $(138,111) and ($48), respectively. Losses generally represent our portion of this real estate company’s loss for the same period. During the quarter ended March 31, 2016 one limited liability company was sold for $399,934 resulting in a gain of $139,821.
Operating Leases of Lessor Disclosure		Rental Properties: At the end of 2013, the Company foreclosed on a loan previously held for sale in Lebanon, Oregon through the bankruptcy courts, and is accounting for the company’s carrying value of $85,534 as a rental property. The property was subsequently leased on a three year lease agreement for $1,500 per month. During the quarter ended March 31, 2016 and 2015, the company recognized $4,500 in rental income. This is a commercial building being depreciated over thirty-nine (39) years. The company recorded depreciation of $536 for the quarters ended March 31, 2016 and 2015.
Leases of Lessee Disclosure		Real Estate Leasehold Interest: On May 31, 2013, the Company completed the acquisition of a real property leasehold interest in approximately 63 acres with fifty (50) RV/residential lots located in Dunn County, North Dakota, (the "Halliday Project"). Total consideration for the leasehold interest was $619,250. The Company may place recreational vehicles, mobile homes, or construct cabins on the lots and offer them for rent or lease. In 2015 the Company purchased two travel trailers for $30,000 from JC Housing, LLC, a related party (see Note 8). The Company recorded amortization of $5,161 for the quarters ended March 31, 2016 and 2015, respectively. At March 31, 2016 and 2015, the Company had none and thirteen lots leased and had rental income for the three month ended March 31, 2016 and 2015 of $1,000 and $12,000, respectively. The lease consists of approximately 63 acres in the city of Halliday, North Dakota. The lease term is fifteen years and commenced on September 15, 2012. The Company has an option to renew the lease for an additional fifteen year term. The monthly rent on the lease is Fifty ($50.00) Dollars for each occupied and rented trailer, cabin or lot. The Company is obligated to pay any and all real and personal property taxes, general taxes, special assessments and other charges levied against the property and its improvements. During the lease term, the Company will own title to all of the improvements and personal property. At the expiration of the lease or termination, all improvements and personal property located on the premises will revert to the Lessors. At December 31, 2015, the Company decided to adjust the carrying value of the property to a fair value estimated of $195,065 (not including travel trailers), based on management’s estimate of discounted cash flows received from the property.
Equity Method Investment Flyback Energy Inc.
Equity Method Investments and Joint Ventures Disclosure		Flyback Energy, Inc.: In December 2015, the Company reduced the carrying value of its Flyback Energy common shares to $0.067 per share, or $212,619, and recorded an impairment change of $1,037,381 based on the last known common share sale. Flyback Energy, Inc. is still a development stage company being financed by outside sources of capital. At this time, Flyback is not assured of future financing capital and is subject to changing world conditions.
Equity Method Investment Digi Outdoor Media, Inc.
Equity Method Investments and Joint Ventures Disclosure		Digi Outdoor Media, Inc.: In 2014, the Company loaned Placer Creek Mining Company (“Placer”) $150,000. The loan interest rate is 5.0% and the Company has an option to convert any or all of the amount due into an equity private placement of Placer. The Placer transaction is treated as a related party transaction. (See Note 8: Michael Lavigne) On February 24, 2015, the Company converted the loan into 300,000 shares of common stock of Digi Outdoor Media, Inc. (“Digi”), the successor in interest to Placer. The Company determined that the fair value of the shares received on the conversion to be $150,000 based upon the loan balance of $150,000 because Digi is not publicly traded and has had no recent cash sale of its common stock. The fair value was determined using Level 2 inputs under the fair value hierarchy. Digi Outdoor Media, Inc. is a startup company in the business of building and leasing outdoor advertising signs.
Loans Receivable, Net		$ 150,000
Conversion of Stock, Shares Converted	300,000
Fair value shares received in transaction	$ 150,000

Note 5 - Lines of Credit (Detai

Note 5 - Lines of Credit (Details) - USD ($)	3 Months Ended
	Mar. 31, 2016	Dec. 31, 2015
Details
Line of Credit Facility, Current Borrowing Capacity	$ 250,000
Long-term Line of Credit	$ 0	$ 170,000
Line of Credit Facility, Asset Restrictions	The Riverbank line requires that the CFC line may not be paid down lower than the amount owing to Riverbank at any time during the term of the loan. The line is payable on demand and is personally guaranteed by John R. and Wendy Coghlan, related parties of the Company.
Line of Credit Facility, Maximum Borrowing Capacity	$ 2,500,000
Line of credit, affiliated company	$ 1,260,000	$ 1,260,000

Note 6 - Notes Payable (Details

Note 6 - Notes Payable (Details) - USD ($)	Mar. 31, 2016	Dec. 31, 2015	Dec. 15, 2010
Details
Convertible note payable to officer		$ 250,000	$ 250,000
Note payable	$ 29,658	$ 30,034

Note 7 - Series "B" Preferred34

Note 7 - Series "B" Preferred Stock (Details) - $ / shares	Jun. 26, 2015	Mar. 31, 2016	Dec. 31, 2015
Details
Preferred Stock, Par Value		$ 1	$ 1
Preferred Stock, Shares Authorized		2,290,000	2,290,000
ConvertiblePreferedStockConvertedToOtherSecurities	1,649,500
Stock Issued During Period, Shares, Conversion of Convertible Securities	4,123,750

Note 8- Related-party Transac35

Note 8- Related-party Transactions (Details)	3 Months Ended
	Mar. 31, 2016
Details
Description of related parties	Related parties are defined as Officers, Directors, and/or those Shareholders owning or controlling more than 5% of the common stock of GFI, or any entities that are owned or controlled by Officers, Directors, and/or those Shareholders owning or controlling more than 5% of the common stock of GFI.
Related parties and relationships	Coghlan Family Corporation, Coghlan, LLC and West 3773 Fifth, LLC are controlled by John R. Coghlan, a Company director, CFO and majority shareholder. Coghlan Family Corporation is owned 100% by Coghlan, LLC, which is owned by the Coghlan family members. John R. and Wendy Coghlan (husband and wife) collectively own 35.65% of Coghlan, LLC and are co-managers. West 3773 Fifth, LLC is owned 100% by John and Wendy Coghlan (husband and wife). JC Housing, LLC is owned 33.33% by John R. Coghlan and 33.33% by Clint Lohman. Mr. Lohman is a director of GFI. Genesis Financial Corporation is a company which is owned 100% by Michael Kirk, who is a director and officer of GFI. GFI provides accounting, office services and supplies, and office space for his services provided to Genesis Financial Corporation. The services are valued at $1,500 per month. Genesis Finance Corporation and John R. Coghlan has managing agreement with the real estate limited liability companies. Michael Lavigne is an officer and director of Placer Creek Mining Company. Mr. Lavigne is a director of GFI.

Noe 9 - Subsequent Events (Deta

Noe 9 - Subsequent Events (Details)	3 Months Ended
	Mar. 31, 2016
Details
Subsequent Event, Description	On April 12, 2016, the Company granted 100,000 restricted common stock shares to Virginia Walters, executive officer for services. The stock was valued at the bid price of the stock on April 12, 2016, the date of issuance which was $0.15 per share.