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SERVICING RIGHTS
 12 Months Ended
Dec. 31, 2020
Transfers and Servicing [Abstract]  
SERVICING RIGHTS SERVICING RIGHTS
The following table presents a composition of total income from servicing rights, which is reported in loan servicing income on the consolidated statements of operations for the periods indicated:
Year Ended December 31,
($ in thousands)202020192018
Servicing fees for sold loans with servicing retained$1,096 $1,291 $5,048 
Losses on the fair value and amortization of servicing rights(591)(612)(1,328)
Total income from servicing rights$505 $679 $3,720 

The following table presents a composition of servicing rights as of the dates indicated:
December 31,
($ in thousands)20202019
Mortgage servicing rights, at fair value$566 $1,157 
SBA servicing rights, at cost888 1,142 
Total$1,454 $2,299 

Mortgage loans sold with servicing retained are subserviced by a third party vendor. The unpaid principal balance of these loans, which are not included in assets, totaled $104.9 million and $150.6 million at December 31, 2020 and 2019. Custodial escrow balances maintained in connection with serviced loans were $138 thousand and $198 thousand at December 31, 2020 and 2019. The unpaid principal balance of the loans underlying our SBA servicing rights at December 31, 2020 and 2019 was $62.7 million and $75.2 million.
Mortgage Servicing Rights
The value of retained MSRs is generally estimated based on a valuation from a third party provider that calculates the present
value of the expected net servicing income from the portfolio based on key factors that include interest rates, prepayment assumptions, discount rate and estimated cash flows. The following table presents the key characteristics, inputs and economic
assumptions used to estimate the fair value of the MSRs as of the dates indicated:
December 31,
($ in thousands)20202019
Fair value of retained MSRs$566 $1,157 
Discount rate13.00 %13.00 %
Constant prepayment rate25.68 %18.96 %
Weighted-average life (in years)3.114.41

The following table presents activity in the MSRs for the periods indicated:
Year Ended December 31,
($ in thousands)202020192018
Balance at beginning of year$1,157 $1,770 $31,852 
Changes in fair value resulting from valuation inputs or assumptions
(309)(265)(1,155)
Sales of servicing rights— — (28,549)
Other—loans paid off(282)(348)(378)
Balance at end of year$566 $1,157 $1,770 

During the first half of 2018, we sold $28.5 million of MSRs on approximately $3.55 billion in unpaid principal
balances of conventional agency mortgage loans for cash consideration of $30.1 million, subject to a prepayment protection
provision and standard representations and warranties. The sale of MSRs resulted in a net loss of $2.3 million for the year ended December 31, 2018, primarily related to transaction costs, provision for early repayments of loans, and expected repurchase obligations under standard representations and warranties.
SBA Servicing Rights
The value of SBA servicing rights is estimated based on a present value of the expected net servicing income from the portfolio based on key factors that include interest rates, prepayment assumptions, discount rate and estimated cash flows. The following table presents the key characteristics, inputs and economic assumptions used to estimate the fair value of the SBA servicing rights as of the dates indicated:
December 31,
($ in thousands)20202019
Servicing rights$888 $1,142 
Discount rate7.25 %8.75 %
Constant prepayment rate8.00 %8.00 %
Weighted-average life (in years)3.363.75
The following table presents activity in the SBA servicing rights for the periods indicated:
Year Ended December 31,
($ in thousands)202020192018
Balance at beginning of year$1,142 $1,658 $1,856 
Additions— — 127 
Amortization, including prepayments(254)(493)(298)
Impairment— (23)(27)
Balance at end of year$888 $1,142 $1,658