Comment on CFPB-2012-0046-0001

Altura State Bank is a small rural bank in Minnesota that has been in existence for over 100 years. Throughout our history we have only offered balloon loans for consumer real estate loans. We have had very few foreclosures in our history and none of them were a result of an interest rate repricing or a maturing balloon loan. Due to the size and loan volume of our bank we do not offer secondary market loans (FNMA & Freddie Mac). Since the government has artifically driven down secondary market loan rates we have watched our consumer real estate loan portfolio shrink. In fact, the only consumer real estate loan requests we receive are loans which do not qualify for a secondary market loan due to one factor or another. We provide credit to community members that would not otherwise have access to credit. We plan to cease offering consumer real estate loans if the proposed regulation provides any additional burden or legal exposure to the bank. We also are not able to price many of our loans appropriately due to the burdemsome HPML rules because we do not escrow for taxes and insurance and must stay below the rate table threshold. Remember, these are loans that do not qualify for the secondary market and "unwanted" by the government yet the government tells us what interest rate we can charge the customer. We are located in a small community and if we didn't treat our customers fairly we would not be in business. Our bank and community would be better off if the government stayed out of our business and let us serve our community like we have for over 100 years. The proposed rules serve no relevant purpose in relation to our business model and the community that we serve. I believe small banks that hold balloon loans in their portfolios should be exempt from the proposed rules.