As discussed in Note 2, the Company obtains possession of REO as a result of foreclosures on the associated mortgage loans. The following tables detail activity in the Company's carrying value of REO for the three- and nine-month periods ended September 30, 2021 and 2020:


	Three-Month Period Ended
	September 30, 2021			September 30, 2020
	Number of Properties	Carrying Value		Number of Properties	Carrying Value
		(In thousands)			(In thousands)
Beginning Balance (June 30, 2021 and 2020, respectively)	14	$	35,295	13	$	24,044
Transfers from mortgage loans	4	1,479		4	676
Capital expenditures and other adjustments to cost		312			27
Adjustments to record at the lower of cost or fair value		699			147
Disposals	(3)	(783)		(1)	(100)
Ending Balance (September 30, 2021 and 2020, respectively)	15	$	37,002	16	$	24,794


	Nine-Month Period Ended
	September 30, 2021			September 30, 2020
	Number of Properties	Carrying Value		Number of Properties	Carrying Value
		(In thousands)			(In thousands)
Beginning Balance (December 31, 2020 and 2019, respectively)	13	$	23,598	15	$	30,584
Transfers from mortgage loans	7	14,033		9	2,198
Capital expenditures and other adjustments to cost		2,205			153
Adjustments to record at the lower of cost or fair value		(1,406)			(813)
Disposals	(5)	(1,428)		(8)	(7,328)
Ending Balance (September 30, 2021 and 2020, respectively)	15	$	37,002	16	$	24,794

During the three-month period ended September 30, 2021, the Company sold three REO properties, realizing a net gain (loss) of approximately $(50) thousand. During the three-month period ended September 30, 2020, the Company sold one REO property, realizing a net gain (loss) of approximately $(18) thousand. During the nine-month period ended September 30, 2021, the Company sold five REO properties, realizing a net gain (loss) of approximately $(63) thousand. During the nine-month period ended September 30, 2020, the Company sold eight REO properties, realizing a net gain (loss) of approximately $0.1 million. Such realized gains (losses) are included in Realized gains (losses) on real estate owned, net, on the Company's Condensed Consolidated Statement of Operations. As of September 30, 2021 and December 31, 2020 all of the Company's REO had been obtained as a result of obtaining physical possession through foreclosure. Of the Company's total REO holdings, $25.6 million and $22.4 million were measured at fair value on a non-recurring basis as of September 30, 2021 and December 31, 2020, respectively.