| Foreclosed Assets |
Note 6 - Foreclosed Assets Real estate owned activity was as follows: | | | | | | | | | Six Months | | Six Months | | | Ended | | Ended | | | December 31, 2025 | | December 31, 2024 | Balance July 1, | | $ | 2,312,240 | | $ | 2,312,240 | Loans transferred to real estate owned | | | — | | | — | Capitalized expenditures | | | — | | | — | Direct write-downs | | | — | | | — | Sales of real estate owned | | | — | | | — | Balance September 30, | | | 2,312,240 | | | 2,312,240 | Loans transferred to real estate owned | | | — | | | — | Capitalized expenditures | | | — | | — | Direct write-downs | | | — | | — | Sales of real estate owned | | | — | | | — | Balance December 31, | | $ | 2,312,240 | | $ | 2,312,240 | | | | | | | |
Activity in the valuation allowance is as follows: | | | | | | | | | Six Months | | Six Months | | | Ended | | Ended | | | December 31, 2025 | | December 31, 2024 | Balance July 1, | | $ | 1,315,867 | | $ | 937,100 | Provisions/(recoveries) charged (credited) to expense | | | — | | | — | Reductions from sales of real estate owned | | | — | | | — | Direct write-downs | | | — | | | — | Sales of real estate owned | | | — | | | — | Balance September 30, | | | 1,315,867 | | | 937,100 | Provisions/(recoveries) charged (credited) to expense | | | — | | | — | Reductions from sales of real estate owned | | | — | | | — | Direct write-downs | | | — | | | — | Sales of real estate owned | | | — | | | — | Balance December 31, | | $ | 1,315,867 | | $ | 937,100 | | | | | | | |
Expenses related to foreclosed assets include: | | | | | | | | | Six Months | | Six Months | | | Ended | | Ended | | | December 31, 2025 | | December 31, 2024 | Balance July 1, | | $ | — | | $ | — | Net loss (gain) on sales | | | — | | | — | Provisions for unrealized losses | | | — | | | — | Operating expenses, net of rental income | | | 16,235 | | | 17,572 | Sales of real estate owned | | | — | | | — | Balance September 30, | | | 16,235 | | | 17,572 | Net loss (gain) on sales | | | — | | | — | Provisions for unrealized losses | | | — | | — | Operating expenses, net of rental income | | | 13,495 | | 5,228 | Sales of real estate owned | | | — | | | — | Balance December 31, | | $ | 29,730 | | $ | 22,800 | | | | | | | |
During the fiscal year ended June 30, 2023, the Company foreclosed on collateral supporting a construction loan which was valued at $2.3 million and was included in foreclosed assets (OREO), net. The valuation was based on independent appraisals subject to certain discounts less estimated costs to sell. A subsequent independent appraisal was obtained in April 2024 subject to certain discounts less estimated costs to sell. After adjusting for estimated costs to sell, the revised valuation was $1.4 million resulting in a provision for valuation allowance of $937,100 being recorded during the year ended June 30, 2024. An offer to sell the property for $1.1 million was accepted by the Company in August 2025 resulting in a provision for valuation allowance of $378,767 being recorded during the year ended June 30, 2025. The sale contract was terminated during the current quarter and the Company has relisted the property for $1.5 million. The recorded investment in one-to-four-family owner occupied properties that were in the process of foreclosure was $190,013 and $66,645 at December 31, 2025 and June 30, 2025, respectively.
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