Note 6. Loans

The Bank reports its loan portfolio based on the primary collateral of the loan. It further classifies these loans by the primary purpose, either consumer or commercial. The Bank’s residential real estate loans include long-term loans to individuals and businesses secured by mortgages on the borrower’s real property and include home equity loans. Construction loans are made to finance the purchase of land and the construction of residential and commercial buildings thereon, and are secured by mortgages on real estate. Commercial real estate loans include construction, owner and non-owner occupied properties and farm real estate. Commercial loans are made to businesses of various sizes for a variety of purposes including property, plant and equipment, working capital and loans to government municipalities. Commercial lending is concentrated in the Bank’s primary market, but also includes purchased loan participations. Consumer loans are comprised of installment loans and unsecured personal lines of credit.

A summary of loans outstanding, by primary collateral, at the end of the reporting periods is as follows:


						Change
(Dollars in thousands)	March 31, 2015		December 31, 2014			Amount	%
Residential Real Estate 1-4 Family
Consumer first liens	$	104,949	$	105,014	$	(65)	(0.1)
Consumer junior liens and lines of credit		37,699		38,132		(433)	(1.1)
Total consumer		142,648		143,146		(498)	(0.3)

Commercial first lien		56,345		56,300		45	0.1
Commercial junior liens and lines of credit		5,556		5,663		(107)	(1.9)
Total commercial		61,901		61,963		(62)	(0.1)
Total residential real estate 1-4 family		204,549		205,109		(560)	(0.3)

Residential real estate - construction
Consumer		1,312		1,627		(315)	(19.4)
Commercial		8,371		8,088		283	3.5
Total residential real estate construction		9,683		9,715		(32)	(0.3)

Commercial real estate		323,675		326,482		(2,807)	(0.9)
Commercial		179,408		179,071		337	0.2
Total commercial		503,083		505,553		(2,470)	(0.5)

Consumer		5,643		6,154		(511)	(8.3)
		722,958		726,531		(3,573)	(0.5)
Less: Allowance for loan losses		(9,210)		(9,111)		(99)	1.1
Net Loans	$	713,748	$	717,420	$	(3,672)	(0.5)

Included in the loan balances are the following:
Net unamortized deferred loan costs (fees)	$	42	$	(76)

Loans pledged as collateral for borrowings and commitments from:
FHLB	$	604,784	$	602,633
Federal Reserve Bank		55,657		56,367
	$	660,441	$	659,000