| Loans and Allowance for Loan Losses | Note 6: Loans and Allowance for Loan Losses Classes of loans include: March 31, 2021 June 30, 2020 Real estate loans: One- $ 116,363 $ 128,876 Multi-family 105,895 96,195 Commercial 149,639 145,113 Home equity lines of credit 7,814 8,551 Construction 20,783 22,042 Commercial 103,326 107,581 Consumer 7,498 7,529 Total loans 511,318 515,887 Less: Unearned fees and discounts, net 513 (164 ) Allowance for loan losses 6,351 6,234 Loans, net $ 504,454 $ 509,817 The Company believes that sound loans are a necessary and desirable means of employing funds available for investment. Recognizing the Company’s obligations to its depositors and to the communities it serves, authorized personnel are expected to seek to develop and make sound, profitable loans that resources permit and that opportunity affords. The Company maintains lending policies and procedures designed to focus our lending efforts on the types, locations, and duration of loans most appropriate for our business model and markets. The Company’s lending activity includes the origination of one- Management reviews and approves the Company’s lending policies and procedures on a routine basis. Management routinely (at least quarterly) reviews our allowance for loan losses and reports related to loan production, loan quality, concentrations of credit, loan delinquencies and non-performing The Company’s policies and loan approval limits are established by the Board of Directors. The loan officers generally have authority to approve one- one- one- The Company conducts internal loan reviews that validate the loans against the Company’s loan policy quarterly for mortgage, consumer, and small commercial loans on a sample basis, and all larger commercial loans on an annual basis. The Company also receives independent loan reviews performed by a third party on larger commercial loans to be performed semi-annually. In addition to compliance with our policy, the third party loan review process reviews the risk assessments made by our credit department, lenders and loan committees. Results of these reviews are presented to management and the Board of Directors. The Company’s lending can be summarized into six primary areas; one- One- The Company offers one- non-conforming one- one- The Company offers USDA Rural Development loans which are originated and sold servicing released. The Company also offers FHA and VA loans that are originated through a nationwide wholesale lender. In addition, the Company also offers home equity loans that are secured by a second mortgage on the borrower’s primary or secondary residence. Home equity loans are generally underwritten using the same criteria used to underwrite one- As one- one- Commercial Real Estate and Multi-Family Real Estate Loans Commercial real estate mortgage loans are primarily secured by office buildings, owner-occupied businesses, strip mall centers, churches and farm loans secured by real estate. In underwriting commercial real estate and multi-family real estate loans, the Company considers a number of factors, which include the projected net cash flow to the loan’s debt service requirement, the age and condition of the collateral, the financial resources and income level of the borrower and the borrower’s experience in owning or managing similar properties. Personal guarantees are typically obtained from commercial real estate and multi-family real estate borrowers. In addition, the borrower’s financial information on such loans is monitored on an ongoing basis by requiring periodic financial statement updates. The repayment of these loans is primarily dependent on the cash flows of the underlying property. However, the commercial real estate loan generally must be supported by an adequate underlying collateral value. The performance and the value of the underlying property may be adversely affected by economic factors or geographical and/or industry specific factors. These loans are subject to other industry guidelines that are closely monitored by the Company. Home Equity Lines of Credit In addition to traditional one- one- Commercial Business Loans The Company originates commercial non-mortgage medium-sized The commercial business loan portfolio consists primarily of secured loans. When making commercial business loans, the Company considers the financial statements, lending history and debt service capabilities of the borrower, the projected cash flows of the business and the value of any collateral. The cash flows of the underlying borrower, however, may not perform consistently with historical or projected information. Further, the collateral securing loans may fluctuate in value due to individual economic or other factors. Loans are typically guaranteed by the principals of the borrower. The Company has established minimum standards and underwriting guidelines for all commercial loan types. Real Estate Construction Loans The Company originates construction loans for one- Consumer Loans Consumer loans consist of installment loans to individuals, primarily automotive loans. These loans are underwritten utilizing the borrower’s financial history, including the Fair Isaac Corporation (“FICO”) Loan-to-value Loan Concentration The loan portfolio includes a concentration of loans secured by commercial and multi-family real estate properties amounting to $267,047,000 and $256,015,000 as of March 31, 2021 and June 30, 2020, respectively. Generally, these loans are collateralized by multi-family and nonresidential properties. The loans are expected to be repaid from cash flows or from proceeds from the sale of the properties of the borrower. Purchased Loans and Loan Participations The Company’s loans receivable included purchased loans of $3,701,000 and $4,181,000 at March 31, 2021 and June 30, 2020, respectively. All of these purchased loans are secured by single family homes located out of our primary market area primarily in the Midwest. The Company’s loans receivable also include commercial loan participations of $24,833,000 and $23,950,000 at March 31, 2021 and June 30, 2020, respectively, of which $7,559,000 and $8,126,000, at March 31, 2021 and June 30, 2020 were outside our primary market area. Allowance for Loan Losses The following tables present the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of the three month and nine month periods ended March 31, 2021 and 2020 and the year ended June 30, 2020: Three Months Ended March 31, 2021 Real Estate Loans One- Four-Family Multi- Commercial Home Equity Allowance for loan losses: Balance, beginning of period $ 1,011 $ 1,744 $ 1,782 $ 79 Provision charged to expense (56 ) (3 ) (24 ) — Losses charged off — — — — Recoveries — — — — Balance, end of period $ 955 $ 1,741 $ 1,758 $ 79 Ending balance: individually evaluated for impairment $ — $ — $ — $ — Ending balance: collectively evaluated for impairment $ 955 $ 1,741 $ 1,758 $ 79 Loans: Ending balance $ 116,363 $ 105,895 $ 149,639 $ 7,814 Ending balance: individually evaluated for impairment $ 1,328 $ — $ — $ — Ending balance: collectively evaluated for impairment $ 115,035 $ 105,895 $ 149,639 $ 7,814 Three Months Ended March 31, 2021 (Continued) Construction Commercial Consumer Total Allowance for loan losses: Balance, beginning of period $ 130 $ 1,636 $ 67 $ 6,449 Provision charged to expense 69 (80 ) (7 ) (101 ) Losses charged off — — (7 ) (7 ) Recoveries — 4 6 10 Balance, end of period $ 199 $ 1,560 $ 59 $ 6,351 Ending balance: individually evaluated for impairment $ — $ — $ — $ — Ending balance: collectively evaluated for impairment $ 199 $ 1,560 $ 59 $ 6,351 Loans: Ending balance $ 20,783 $ 103,326 $ 7,498 $ 511,318 Ending balance: individually evaluated for impairment $ — $ 65 $ — $ 1,393 Ending balance: collectively evaluated for impairment $ 20,783 $ 103,261 $ 7,498 $ 509,925 Nine Months Ended March 31, 2021 Real Estate Loans One- Four-Family Multi- Family Commercial Home Equity Allowance for loan losses: Balance, beginning of period $ 1,044 $ 1,514 $ 1,706 $ 87 Provision charged to expense (76 ) 227 52 (8 ) Losses charged off (15 ) — — — Recoveries 2 — — — Balance, end of period $ 955 $ 1,741 $ 1,758 $ 79 Ending balance: individually evaluated for impairment $ — $ — $ — $ — Ending balance: collectively evaluated for impairment $ 955 $ 1,741 $ 1,758 $ 79 Loans: Ending balance $ 116,363 $ 105,895 $ 149,639 $ 7,814 Ending balance: individually evaluated for impairment $ 1,328 $ — $ — $ — Ending balance: collectively evaluated for impairment $ 115,035 $ 105,895 $ 149,639 $ 7,814 Nine Months Ended March 31, 2021 (Continued) Construction Commercial Consumer Total Allowance for loan losses: Balance, beginning of period $ 240 $ 1,583 $ 60 $ 6,234 Provision charged to expense (41 ) 1 10 165 Losses charged off — (40 ) (23 ) (78 ) Recoveries — 16 12 30 Balance, end of period $ 199 $ 1,560 $ 59 $ 6,351 Ending balance: individually evaluated for impairment $ — $ — $ — $ — Ending balance: collectively evaluated for impairment $ 199 $ 1,560 $ 59 $ 6,351 Loans: Ending balance $ 20,783 $ 103,326 $ 7,498 $ 511,318 Ending balance: individually evaluated for impairment $ — $ 65 $ — $ 1,393 Ending balance: collectively evaluated for impairment $ 20,783 $ 103,261 $ 7,498 $ 509,925 Year Ended June 30, 2020 Real Estate Loans One- Four-Family Multi- Commercial Home Equity Allowance for loan losses: Balance, beginning of year $ 1,031 $ 1,642 $ 1,623 $ 89 Provision charged to expense 50 (128 ) 83 (2 ) Losses charged off (40 ) — — — Recoveries 3 — — — Balance, end of year $ 1,044 $ 1,514 $ 1,706 $ 87 Ending balance: individually evaluated for impairment $ — $ — $ — $ — Ending balance: collectively evaluated for impairment $ 1,044 $ 1,514 $ 1,706 $ 87 Loans: Ending balance $ 128,876 $ 96,195 $ 145,113 $ 8,551 Ending balance: individually evaluated for impairment $ 1,336 $ — $ — $ 15 Ending balance: collectively evaluated for impairment $ 127,540 $ 96,195 $ 145,113 $ 8,536 Year Ended June 30, 2020 (Continued) Construction Commercial Consumer Total Allowance for loan losses: Balance, beginning of year $ 213 $ 1,659 $ 71 $ 6,328 Provision charged to expense 27 84 14 128 Losses charged off — (191 ) (37 ) (268 ) Recoveries — 31 12 46 Balance, end of year $ 240 $ 1,583 $ 60 $ 6,234 Ending balance: individually evaluated for impairment $ — $ — $ — $ — Ending balance: collectively evaluated for impairment $ 240 $ 1,583 $ 60 $ 6,234 Loans: Ending balance $ 22,042 $ 107,581 $ 7,529 $ 515,887 Ending balance: individually evaluated for impairment $ — $ 304 $ 5 $ 1,660 Ending balance: collectively evaluated for impairment $ 22,042 $ 107,277 $ 7,524 $ 514,227 Three Months Ended March 31, 2020 Real Estate Loans One- Four-Family Multi- Commercial Home Equity Allowance for loan losses: Balance, beginning of period $ 991 $ 1,562 $ 1,685 $ 90 Provision charged to expense 74 121 (5 ) 2 Losses charged off (27 ) — — — Recoveries — — — — Balance, end of period $ 1,038 $ 1,683 $ 1,680 $ 92 Ending balance: individually evaluated for impairment $ — $ — $ — $ — Ending balance: collectively evaluated for impairment $ 1,038 $ 1,683 $ 1,680 $ 92 Loans: Ending balance $ 129,185 $ 107,107 $ 143,396 $ 9,131 Ending balance: individually evaluated for impairment $ 1,591 $ — $ 4 $ 16 Ending balance: collectively evaluated for impairment $ 127,594 $ 107,107 $ 143,392 $ 9,115 Three Months Ended March 31, 2020 (Continued) Construction Commercial Consumer Total Allowance for loan losses: Balance, beginning of period $ 217 $ 1,610 $ 67 $ 6,222 Provision charged to expense 27 57 6 282 Losses charged off — — (6 ) (33 ) Recoveries — — 3 3 Balance, end of period $ 244 $ 1,667 $ 70 $ 6,474 Ending balance: individually evaluated for impairment $ — $ — $ — $ — Ending balance: collectively evaluated for impairment $ 244 $ 1,667 $ 70 $ 6,474 Loans: Ending balance $ 20,897 $ 83,812 $ 7,154 $ 500,682 Ending balance: individually evaluated for impairment $ — $ 41 $ 7 $ 1,659 Ending balance: collectively evaluated for impairment $ 20,897 $ 83,771 $ 7,147 $ 499,023 Nine Months Ended March 31, 2020 Real Estate Loans One- Four-Family Multi- Commercial Home Equity Allowance for loan losses: Balance, beginning of period $ 1,031 $ 1,642 $ 1,623 $ 89 Provision charged to expense 44 41 57 3 Losses charged off (40 ) — — — Recoveries 3 — — — Balance, end of period $ 1,038 $ 1,683 $ 1,680 $ 92 Ending balance: individually evaluated for impairment $ — $ — $ — $ — Ending balance: collectively evaluated for impairment $ 1,038 $ 1,683 $ 1,680 $ 92 Loans: Ending balance $ 129,185 $ 107,107 $ 143,396 $ 9,131 Ending balance: individually evaluated for impairment $ 1,591 $ — $ 4 $ 16 Ending balance: collectively evaluated for impairment $ 127,594 $ 107,107 $ 143,392 $ 9,115 Nine Months Ended March 31, 2020 (Continued) Construction Commercial Consumer Total Allowance for loan losses: Balance, beginning of period $ 213 $ 1,659 $ 71 $ 6,328 Provision charged to expense 31 (6 ) 28 198 Losses charged off — — (34 ) (74 ) Recoveries — 14 5 22 Balance, end of period $ 244 $ 1,667 $ 70 $ 6,474 Ending balance: individually evaluated for impairment $ — $ — $ — $ — Ending balance: collectively evaluated for impairment $ 244 $ 1,667 $ 70 $ 6,474 Loans: Ending balance $ 20,897 $ 83,812 $ 7,154 $ 500,682 Ending balance: individually evaluated for impairment $ — $ 41 $ 7 $ 1,659 Ending balance: collectively evaluated for impairment $ 20,897 $ 83,771 $ 7,147 $ 499,023 Management’s opinion as to the ultimate collectability of loans is subject to estimates regarding future cash flows from operations and the value of property, real and personal, pledged as collateral. These estimates are affected by changing economic conditions and the economic prospects of borrowers. The allowance for loan losses represents an estimate of the amount of losses believed inherent in our loan portfolio at the balance sheet date. The allowance calculation involves a high degree of estimation that management attempts to mitigate through the use of objective historical data where available. Loan losses are charged against the allowance for loan losses when management believes the uncollectibility of the loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. Overall, we believe the reserve to be consistent with prior periods and adequate to cover the estimated losses in our loan portfolio. The Company’s methodology for assessing the appropriateness of the allowance for loan losses consists of two key elements: (1) specific allowances for estimated credit losses on individual loans that are determined to be impaired through the Company’s review for identified problem loans; and (2) a general allowance based on estimated credit losses inherent in the remainder of the loan portfolio. The specific allowance is measured by determining the present value of expected cash flows, the loan’s observable market value, or, for collateral-dependent loans, the fair value of the collateral adjusted for market conditions and selling expense. Factors used in identifying a specific problem loan include: (1) the strength of the customer’s personal or business cash flows; (2) the availability of other sources of repayment; (3) the amount due or past due; (4) the type and value of collateral; (5) the strength of the collateral position; (6) the estimated cost to sell the collateral; and (7) the borrower’s effort to cure the delinquency. In addition for loans secured by real estate, the Company also considers the extent of any past due and unpaid property taxes applicable to the property serving as collateral on the mortgage. The Company establishes a general allowance for loans that are not deemed impaired to recognize the inherent losses associated with lending activities, but which, unlike specific allowances, has not been allocated to particular problem assets. The general valuation allowance is determined by segregating the loans by loan category and assigning allowance percentages based on the Company’s historical loss experience, delinquency trends and management’s evaluation of the collectability of the loan portfolio. In certain instances, the historical loss experience could be adjusted if similar risks are not inherent in the remaining portfolio. The allowance is then adjusted for qualitative factors that, in management’s judgment, affect the collectability of the portfolio as of the evaluation date. These qualitative factors may include: (1) Management’s assumptions regarding the minimal level of risk for a given loan category; (2) changes in lending policies and procedures, including changes in underwriting standards, and charge-off non-accrual re-evaluated Although the Company’s policy allows for a general valuation allowance on certain smaller-balance, homogenous pools of loans classified as substandard, the Company has historically evaluated every loan classified as substandard, regardless of size, for impairment as part of the review for establishing specific allowances. The Company’s policy also allows for general valuation allowance on certain smaller-balance, homogenous pools of loans which are loans criticized as special mention or watch. A separate general allowance calculation is made on these loans based on historical measured weakness, and which is no less than twice the amount of the general allowance calculated on the non-classified There have been no changes to the Company’s accounting policies or methodology from the prior periods. The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as current financial information, historical payment experience, credit documentation, public information and current economic trends, among other factors. All loans are graded at inception of the loan. Subsequently, analyses are performed on an annual basis and grade changes are made as necessary. Interim grade reviews may take place if circumstances of the borrower warrant a more timely review. The Company utilizes an internal asset classification system as a means of reporting problem and potential problem loans. Under the Company’s risk rating system, the Company classifies problem and potential problem loans as “Watch,” “Substandard,” “Doubtful,” and “Loss.” The Company uses the following definitions for risk ratings: Pass – Watch – Substandard – Doubtful – Loss – Risk characteristics applicable to each segment of the loan portfolio are described as follows. Residential One- one- one- Commercial and Multi-family Real Estate: Construction Real Estate: Commercial: Consumer: The following tables present the credit risk profile of the Company’s loan portfolio based on rating category and payment activity: Real Estate Loans One- to Four- Multi-Family Commercial Home Equity Lines of Credit Construction Commercial Consumer Total March 31, 2021: Pass $ 115,838 $ 105,630 $ 148,491 $ 7,814 $ 20,783 $ 97,042 $ 7,496 $ 503,094 Watch — — 966 — — 6,219 2 7,187 Substandard 525 265 182 — — 65 — 1,037 Doubtful — — — — — — — — Loss — — — — — — — — Total $ 116,363 $ 105,895 $ 149,639 $ 7,814 $ 20,783 $ 103,326 $ 7,498 $ 511,318 Real Estate Loans One- Multi-Family Commercial Home Equity Construction Commercial Consumer Total June 30, 2020: Pass $ 127,279 $ 95,925 $ 143,727 $ 8,402 $ 22,042 $ 105,605 $ 7,524 $ 510,504 Watch 775 — 1,073 134 — 1,651 — 3,633 Substandard 822 270 313 15 — 81 5 1,506 Doubtful — — — — — 244 — 244 Loss — — — — — — — — Total $ 128,876 $ 96,195 $ 145,113 $ 8,551 $ 22,042 $ 107,581 $ 7,529 $ 515,887 The accrual of interest on loans is discontinued at the time the loan is 90 days past due unless the credit is well secured and in process of collection. Past due status is based on contractual terms of the loan. In all instances, loans are placed on non-accrual All interest accrued but not collected for loans that are placed on non-accrual The following tables present the Company’s loan portfolio aging analysis: 30-59 Days 60-89 Days Past Due 90 Days or Total Past Due Current Total Loans Total Loans March 31, 2021: Real estate loans: One- $ 637 $ — $ 224 $ 861 $ 115,502 $ 116,363 $ 121 Multi-family — — — — 105,895 105,895 — Commercial — 399 — 399 149,240 149,639 — Home equity lines of credit — — — — 7,814 7,814 — Construction — — — — 20,783 20,783 — Commercial — — 17 17 103,309 103,326 — Consumer 24 16 — 40 7,458 7,498 — Total $ 661 $ 415 $ 241 $ 1,317 $ 510,001 $ 511,318 $ 121 30-59 60-89 Past Due 90 Days or Total Past Due Current Total Loans Total Loans June 30, 2020: Real estate loans: One- $ 1,034 $ 225 $ 385 $ 1,644 $ 127,232 $ 128,876 $ 304 Multi-family — — — — 96,195 96,195 — Commercial 172 95 — 267 144,846 145,113 — Home equity lines of credit — — — — 8,551 8,551 — Construction — — — — 22,042 22,042 — Commercial — 4 244 248 107,333 107,581 — Consumer 24 43 — 67 7,462 7,529 — Total $ 1,230 $ 367 $ 629 $ 2,226 $ 513,661 $ 515,887 $ 304 A loan is considered impaired, in accordance with the impairment accounting guidance (ASC 310-10-35-16), case-by-case Impairment is measured on a loan-by-loan The Company actively seeks to reduce its investment in impaired loans. The primary tools to work through impaired loans are settlements with the borrowers or guarantors, foreclosure of the underlying collateral, or restructuring. Included in certain loan categories in the impaired loans are $1.3 million in TDRs that were classified as impaired. The following tables present impaired loans: Three Months Ended March 31, 2021 Nine Months Ended March 31, 2021 Recorded Unpaid Specific Average Interest Interest on Average Interest Interest on March 31, 2021: Loans without a specific valuation allowance Real estate loans: One- $ 1,328 $ 1,328 $ — $ 1,331 $ 14 $ 9 $ 1,343 $ 49 $ 42 Multi-family — — — — — — — — — Commercial — — — — — — — — — Home equity line of credit — — — — — — — — — Construction — — — — — — — — — Commercial 65 65 — 67 1 1 73 2 2 Consumer — — — — — — — — — Loans with a specific valuation allowance Real estate loans: One- — — — — — — — — — Multi-family — — — — — — — — — Commercial — — — — — — — — — Home equity line of credit — — — — — — — — — Construction — — — — — — — — — Commercial — — — — — — — — — Consumer — — — — — — — — — Total: Real estate loans: One- 1,328 1,328 — 1,331 14 9 1,343 49 42 Multi-family — — — — — — — — — Commercial — — — — — — — — — Home equity line of credit — — — — — — — — — Construction — — — — — — — — — Commercial 65 65 — 67 1 1 73 2 2 Consumer — — — — — — — — — $ 1,393 $ 1,393 $ — $ 1,398 $ 15 $ 10 $ 1,416 $ 51 $ 44 Recorded Unpaid Specific Average Interest Interest on Cash June 30, 2020: Loans without a specific valuation allowance Real estate loans: One- to $ 1,336 $ 1,336 $ — $ 1,388 $ 61 $ 62 Multi-family — — — — — — Commercial — — — 3 — — Home equity line of credit 15 15 — 18 — — Construction — — — — — — Commercial 304 304 — 382 23 25 Consumer 5 5 — 9 — — Loans with a specific allowance Real estate loans: One- — — — — — — Multi-family — — — — — — Commercial — — — — — — Home equity line of credit — — — — — — Construction — — — — — — Commercial — — — — — — Consumer — — — — — — Total: Real estate loans: One- to four-family 1,336 1,336 — 1,388 61 62 Multi-family — — — — — — Commercial — — — 3 — — Home equity line of credit 15 15 — 18 — — Construction — — — — — — Commercial 304 304 — 382 23 25 Consumer 5 5 — 9 — — $ 1,660 $ 1,660 $ — $ 1,800 $ 84 $ 87 Three Months Ended March 31, 2020 Nine Months Ended March 31, 2020 Recorded Unpaid Specific Average Interest Interest on Average Interest Interest on March 31, 2020: Loans without a specific valuation allowance Real estate loans: One- to four-family $ 1,591 $ 1,591 $ — $ 1,613 $ 13 $ 15 $ 1,641 $ 47 $ 48 Multi-family — — — — — — — — — Commercial 4 4 — 5 — — 11 — — Home equity line of credit 16 16 — 17 — — 19 — — Construction — — — — — — — — — Commercial 41 41 — 44 — — 51 — — Consumer 7 7 — 8 — — 9 — — Loans with a specific valuation allowance Real estate loans: One- to four-family — — — — — — — — — Multi-family — — — — — — — — — Commercial — — — — — — — — — Home equity line of credit — — — — — — — — — Construction — — — — — — — — — Commercial — — — — — — — — — Consumer — — — — — — — — — Total: Real estate loans: One- to four-family 1,591 1,591 — 1,613 13 15 1,641 47 48 Multi-family — — — — — — — — — Commercial 4 4 — 5 — — 11 — — Home equity line of credit 16 16 — 17 — — 19 — — Construction — — — — — — — — — Commercial 41 41 — 44 — — 51 — — Consumer 7 7 — 8 — — 9 — — $ 1,659 $ 1,659 $ — $ 1,687 $ 13 $ 15 $ 1,731 $ 47 $ 48 Interest income recognized on impaired loans includes interest accrued and collected on the outstanding balances of accruing impaired loans as well as interest cash collections on non-accruing impaired loans for which the ultimate collectability of principal is not uncertain. The following table presents the Company’s nonaccrual loans at March 31, 2021 and June 30, 2020: March 31, 2021 June 30, 2020 Mortgages on real estate: One- to four-family $ 103 $ 81 Multi-family — — Commercial — — Home equity lines of credit — 15 Construction loans — — Commercial business loans 17 304 Consumer loans — 5 Total $ 120 $ 405 At March 31, 2021 and June 30, 2020, the Company had a number of loans that were modified in TDRs and that were impaired. The modification of terms of such loans included one or a combination of the following: an extension of maturity, a reduction of the stated interest rate or a permanent reduction of the recorded investment in the loan. The following table presents the recorded balance, at original cost, of troubled debt restructurings, as of March 31, 2021 and June 30, 2020. With the exception of a single one- to four-family residential loans for $121,000, all were performing according to the terms of the restructuring as of March 31, 2021, and with the exception of a single one- to four-family residential loan totaling $127,000, all were performing according to the terms of restructuring as of June 30, 2020. As of March 31, 2021, all loans listed were accruing. All loans listed as of June 30, 2020 were on nonaccrual except for nine one- to four-family residential loans totaling $1.3 million. March 31, June 30, Real estate loans One- $ 1,225 $ 1,256 Multi-family — — Commercial — — Home equity lines of credit — 15 Total real estate loans 1,225 1,271 Construction — — Commercial 48 59 Consumer loans — — Total $ 1,273 $ 1,330 Modifications During the nine month period ended March 31, 2021, no loans were modified as TDRs. During the year ended June 30, 2020, the Company modified one commercial business loan in the amount of $61,000. This modification included a decrease in interest rate and a maturity concession. During the nine month period ended March 31, 2020, no loans were modified as TDRs. See “COVID-19 COVID-19 Under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) that was signed into law on March 27, 2020, certain COVID-19 COVID-19; . COVID-19 months. As of March 31 , 2021 , 147 of these loans totaling $58.1 million have returned to principal and interest payments, leaving 16 loans for $28.6 million still under temporary modifications. TDR’s with Defaults The Company had one TDR, a one- one- Specific loss allowances are included in the calculation of estimated future loss ratios, which are applied to the various loan portfolios for purposes of estimating future losses. Management considers the level of defaults within the various portfolios, as well as the current adverse economic environment and negative outlook in the real estate and collateral markets when evaluating qualitative adjustments used to determine the adequacy of the allowance for loan losses. We believe the qualitative adjustments more accurately reflect collateral values in light of the sales and economic conditions that we have recently observed. We may obtain physical possession of real estate collateralizing a residential mortgage loan or home equity loan via foreclosure or in-substance |
