4. MORTGAGES RECEIVABLE

The Company offers loans to purchasers in connections with the sale of real estate lots. The loans bear interest at 7.2% per annum and terms generally range from eight to ten years. The loans are secured by a first mortgage lien on the property purchased by the borrower. Mortgages receivable includes the related interest receivable and are presented at amortized cost, less bad debt allowances, in the condensed consolidated financial statements.

Management evaluates each loan individually on a quarterly basis, to assess collectability and estimate a reserve for past due amounts. The total allowance for uncollectable mortgages as of September 30, 2022 and December 31, 2021 was $219,115 and $203,996, respectively. Past due principal amounts of $203,097 and $143,152 are included in mortgages, receivable, current as of September 30, 2022 and December 31, 2021, respectively. In the case of each of the past due loans, the Company believes that the value of the collateral exceeds the outstanding balance on the loan, plus accrued interest.

The following is the maturities of mortgages receivable as of September 30, 2022:

 SCHEDULE OF MATURITIES OF MORTGAGES RECEIVABLE

As of September 30, 2022 and December 31, 2021, no single borrower had loans outstanding representing more than 10% of total balance of mortgages receivable.

The Company recorded interest income of $63,995 and $3,511 for the three months ended September 30, 2022 and 2021, respectively, and recorded interest income of $92,638 and $10,864 for the nine months ended September 30, 2022 and 2021, respectively. As of September 30, 2022 and December 31, 2021, there is $134,557 and $60,843, respectively, of interest receivable included in mortgages receivable on the accompanying condensed consolidated balance sheets.