Step 1:
Set the Foreground color to #925f2d, and the Background color to #694018. Fill the Background with the Foreground color (#925f2d), then go to Filter - Render - Fibers. Type in the value (22) for Variance, and (5.0) for Strength.

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Step 2:
Go to Filter - Render - Lighting Effects, and create the effect below:

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Step 3:
- Now, we are going to use the Brushes to add some texture to the Background.
Create a new layer, call it "grunge - bottom", and from the first Brushes set (Grunge Brushes by ~Aramisdream), choose the brush highlighted below. Using the color #a5a4ac, place the brush the way you like on one of the corners of the Background.

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Change the layer "grunge - bottom" Blend Mode to "Vivid Light".

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- From the same Brushes set, choose the brush below, and change the color to #c2bdad. Create a new layer and call it "grunge - top". Place the brush at the top of the layer.

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Change the layer "grunge - top" Blend Mode to "Multiply".

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- Finally, using the same color (#c2bdad), but the second Brushes set (grunge.28 Brushes by *ShadyMedusa stock), create a new layer and call it "grunge - BG", and use the brushes highlighted below to scatter some texture on the Background.

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Change the "grunge _ BG" layer Blend Mode to "Multiply" as well.

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Step 4:
Now, it's time to create the text. Grab the color #f6f1e0, and create your text using a bold font. I'm using the font "Trumania EEN", and the size is (206) px.

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Step 5:

Double click on the text layer to apply the following layer styles:

- Apply a Drop Shadow. Change the color to #533416, the Distance to (0), the Spread to (6), and the Size to (20).

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- Add an Inner Shadow. Change the color to #be7d0c, the Distance to (0), the Choke to (20), and the Size to (30). Some Noise will add a nice effect to the text, so go ahead and adjust the Noise value until you're satisfied with the result.

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- To intensify the burning effect, we are going to mess a little bit with the Outer Glow. Change the Blend Mode to Multiply, using the color #bfa68e, and the size value of (18)px.

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- And finally, we will be using the Inner Glow to add the burning effect for the inner side of the text. Again, change the Blend Mode to Multiply, (we're burning it up! remember?), change the color to #af641a, and the Size to (8)px.

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Step 6:
Now to the fun part. Know the shaking hand you get when using the "Lasso Tool"? Yeah! we're gonna make use of that! So grab the Lasso Tool, and start creating some "shaky" jagged edges around the letters. Choose the Add to Selection option to create the selection for all the letters at the same time.

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Step 7:
Once you're done drawing the selection, you can duplicate the text layer to keep a backup, then go to the current layer you're working on, right click on it, and click on Rasterize Type.
Then, go to Select - Inverse to inverse the selection, (or just press Shift + Ctrl + I), and hit Delete to remove the outer edge.

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Finally, change the Layer Blend Mode to Soft Light, and the Fill value to 85%. Notice that we do NOT change the Opacity value, but rather the Fill value, as the Opacity will reduce the Styles opacity along with the fill.

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Result

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