Loans and Allowance for Credit Losses | Note 5: Loans and Allowance for Credit Losses Table 5.1 presents total loans outstanding by portfolio segment and class of financing receivable. Outstanding balances include a total net reduction of $4.3 billion and $4.4 billion at March 31, 2017 , and December 31, 2016 , respectively, for unearned income, net deferred loan fees, and unamortized discounts and premiums. Table 5.1: Loans Outstanding (in millions) Mar 31, Dec 31, Commercial: Commercial and industrial $ 329,252 330,840 Real estate mortgage 131,532 132,491 Real estate construction 25,064 23,916 Lease financing 19,156 19,289 Total commercial 505,004 506,536 Consumer: Real estate 1-4 family first mortgage 274,633 275,579 Real estate 1-4 family junior lien mortgage 44,333 46,237 Credit card 34,742 36,700 Automobile 60,408 62,286 Other revolving credit and installment 39,285 40,266 Total consumer 453,401 461,068 Total loans $ 958,405 967,604 Our foreign loans are reported by respective class of financing receivable in the table above. Substantially all of our foreign loan portfolio is commercial loans. Loans are classified as foreign primarily based on whether the borrower’s primary address is outside of the United States. Table 5.2 presents total commercial foreign loans outstanding by class of financing receivable. Table 5.2: Commercial Foreign Loans Outstanding (in millions) Mar 31, Dec 31, Commercial foreign loans: Commercial and industrial $ 56,987 55,396 Real estate mortgage 8,206 8,541 Real estate construction 471 375 Lease financing 986 972 Total commercial foreign loans $ 66,650 65,284 Loan Purchases, Sales, and Transfers Table 5.3 summarizes the proceeds paid or received for purchases and sales of loans and transfers from loans held for investment to mortgages/loans held for sale at lower of cost or fair value. This loan activity also includes participating interests, whereby we receive or transfer a portion of a loan. The table excludes PCI loans and loans for which we have elected the fair value option, including loans originated for sale because their loan activity normally does not impact the allowance for credit losses. Table 5.3: Loan Purchases, Sales, and Transfers 2017 2016 (in millions) Commercial Consumer (1) Total Commercial (2) Consumer (1) Total Quarter ended March 31, Purchases $ 1,159 2 1,161 24,646 — 24,646 Sales (287 ) (62 ) (349 ) (223 ) (272 ) (495 ) Transfers to MHFS/LHFS (479 ) — (479 ) (32 ) (3 ) (35 ) (1) Excludes activity in government insured/guaranteed real estate 1-4 family first mortgage loans. As servicer, we are able to buy delinquent insured/guaranteed loans out of the Government National Mortgage Association (GNMA) pools, and manage and/or resell them in accordance with applicable requirements. These loans are predominantly insured by the Federal Housing Administration (FHA) or guaranteed by the Department of Veterans Affairs (VA). Accordingly, these loans have limited impact on the allowance for loan losses. (2) Purchases include loans and capital leases from the 2016 GE Capital business acquisitions. Commitments to Lend A commitment to lend is a legally binding agreement to lend funds to a customer, usually at a stated interest rate, if funded, and for specific purposes and time periods. We generally require a fee to extend such commitments. Certain commitments are subject to loan agreements with covenants regarding the financial performance of the customer or borrowing base formulas on an ongoing basis that must be met before we are required to fund the commitment. We may reduce or cancel consumer commitments, including home equity lines and credit card lines, in accordance with the contracts and applicable law. We may, as a representative for other lenders, advance funds or provide for the issuance of letters of credit under syndicated loan or letter of credit agreements. Any advances are generally repaid in less than a week and would normally require default of both the customer and another lender to expose us to loss. These temporary advance arrangements totaled approximately $76 billion and $77 billion at March 31, 2017 and December 31, 2016 , respectively. We issue commercial letters of credit to assist customers in purchasing goods or services, typically for international trade. At both March 31, 2017 , and December 31, 2016 , we had $1.1 billion of outstanding issued commercial letters of credit. We also originate multipurpose lending commitments under which borrowers have the option to draw on the facility for different purposes in one of several forms, including a standby letter of credit. See Note 10 (Guarantees, Pledged Assets and Collateral) for additional information on standby letters of credit. When we make commitments, we are exposed to credit risk. The maximum credit risk for these commitments will generally be lower than the contractual amount because a significant portion of these commitments is expected to expire without being used by the customer. In addition, we manage the potential risk in commitments to lend by limiting the total amount of commitments, both by individual customer and in total, by monitoring the size and maturity structure of these commitments and by applying the same credit standards for these commitments as for all of our credit activities. For loans and commitments to lend, we generally require collateral or a guarantee. We may require various types of collateral, including commercial and consumer real estate, automobiles, other short-term liquid assets such as accounts receivable or inventory and long-lived assets, such as equipment and other business assets. Collateral requirements for each loan or commitment may vary based on the loan product and our assessment of a customer’s credit risk according to the specific credit underwriting, including credit terms and structure. The contractual amount of our unfunded credit commitments, including unissued standby and commercial letters of credit, is summarized by portfolio segment and class of financing receivable in Table 5.4 . The table excludes the issued standby and commercial letters of credit and temporary advance arrangements described above. Table 5.4: Unfunded Credit Commitments (in millions) Mar 31, Dec 31, Commercial: Commercial and industrial $ 316,794 319,662 Real estate mortgage 7,448 7,833 Real estate construction 17,794 18,840 Lease financing 11 16 Total commercial 342,047 346,351 Consumer: Real estate 1-4 family first mortgage 33,594 33,498 Real estate 1-4 family junior lien mortgage 41,070 41,431 Credit card 104,630 101,895 Other revolving credit and installment 27,814 28,349 Total consumer 207,108 205,173 Total unfunded credit commitments $ 549,155 551,524 Allowance for Credit Losses Table 5.5 presents the allowance for credit losses, which consists of the allowance for loan losses and the allowance for unfunded credit commitments. Table 5.5: Allowance for Credit Losses Quarter ended March 31, (in millions) 2017 2016 Balance, beginning of period $ 12,540 12,512 Provision for credit losses 605 1,086 Interest income on certain impaired loans (1) (48 ) (48 ) Loan charge-offs: Commercial: Commercial and industrial (253 ) (349 ) Real estate mortgage (5 ) (3 ) Real estate construction — — Lease financing (7 ) (4 ) Total commercial (265 ) (356 ) Consumer: Real estate 1-4 family first mortgage (69 ) (137 ) Real estate 1-4 family junior lien mortgage (93 ) (133 ) Credit card (367 ) (314 ) Automobile (255 ) (211 ) Other revolving credit and installment (189 ) (175 ) Total consumer (973 ) (970 ) Total loan charge-offs (1,238 ) (1,326 ) Loan recoveries: Commercial: Commercial and industrial 82 76 Real estate mortgage 30 32 Real estate construction 8 8 Lease financing 2 3 Total commercial 122 119 Consumer: Real estate 1-4 family first mortgage 62 89 Real estate 1-4 family junior lien mortgage 70 59 Credit card 58 52 Automobile 88 84 Other revolving credit and installment 33 37 Total consumer 311 321 Total loan recoveries 433 440 Net loan charge-offs (805 ) (886 ) Other (5 ) 4 Balance, end of period $ 12,287 12,668 Components: Allowance for loan losses $ 11,168 11,621 Allowance for unfunded credit commitments 1,119 1,047 Allowance for credit losses $ 12,287 12,668 Net loan charge-offs (annualized) as a percentage of average total loans 0.34 % 0.38 Allowance for loan losses as a percentage of total loans 1.17 1.23 Allowance for credit losses as a percentage of total loans 1.28 1.34 (1) Certain impaired loans with an allowance calculated by discounting expected cash flows using the loan’s effective interest rate over the remaining life of the loan recognize changes in allowance attributable to the passage of time as interest income. Table 5.6 summarizes the activity in the allowance for credit losses by our commercial and consumer portfolio segments. Table 5.6: Allowance Activity by Portfolio Segment 2017 2016 (in millions) Commercial Consumer Total Commercial Consumer Total Quarter ended March 31, Balance, beginning of period $ 7,394 5,146 12,540 6,872 5,640 12,512 Provision (reversal of provision) for credit losses (89 ) 694 605 714 372 1,086 Interest income on certain impaired loans (15 ) (33 ) (48 ) (5 ) (43 ) (48 ) Loan charge-offs (265 ) (973 ) (1,238 ) (356 ) (970 ) (1,326 ) Loan recoveries 122 311 433 119 321 440 Net loan charge-offs (143 ) (662 ) (805 ) (237 ) (649 ) (886 ) Other (5 ) — (5 ) 4 — 4 Balance, end of period $ 7,142 5,145 12,287 7,348 5,320 12,668 Table 5.7 disaggregates our allowance for credit losses and recorded investment in loans by impairment methodology. Table 5.7: Allowance by Impairment Methodology Allowance for credit losses Recorded investment in loans (in millions) Commercial Consumer Total Commercial Consumer Total March 31, 2017 Collectively evaluated (1) $ 6,281 3,691 9,972 499,565 421,619 921,184 Individually evaluated (2) 859 1,454 2,313 5,076 16,475 21,551 PCI (3) 2 — 2 363 15,307 15,670 Total $ 7,142 5,145 12,287 505,004 453,401 958,405 December 31, 2016 Collectively evaluated (1) $ 6,392 3,553 9,945 500,487 428,009 928,496 Individually evaluated (2) 1,000 1,593 2,593 5,372 17,005 22,377 PCI (3) 2 — 2 677 16,054 16,731 Total $ 7,394 5,146 12,540 506,536 461,068 967,604 (1) Represents loans collectively evaluated for impairment in accordance with Accounting Standards Codification (ASC) 450-20, Loss Contingencies (formerly FAS 5), and pursuant to amendments by ASU 2010-20 regarding allowance for non-impaired loans. (2) Represents loans individually evaluated for impairment in accordance with ASC 310-10, Receivables (formerly FAS 114), and pursuant to amendments by ASU 2010-20 regarding allowance for impaired loans. (3) Represents the allowance and related loan carrying value determined in accordance with ASC 310-30 , Receivables – Loans and Debt Securities Acquired with Deteriorated Credit Quality (formerly SOP 03-3) and pursuant to amendments by ASU 2010-20 regarding allowance for PCI loans. Credit Quality We monitor credit quality by evaluating various attributes and utilize such information in our evaluation of the appropriateness of the allowance for credit losses. The following sections provide the credit quality indicators we most closely monitor. The credit quality indicators are generally based on information as of our financial statement date, with the exception of updated Fair Isaac Corporation (FICO) scores and updated loan-to-value (LTV)/combined LTV (CLTV). We obtain FICO scores at loan origination and the scores are generally updated at least quarterly, except in limited circumstances, including compliance with the Fair Credit Reporting Act (FCRA). Generally, the LTV and CLTV indicators are updated in the second month of each quarter, with updates no older than December 31, 2016 . See the “Purchased Credit-Impaired Loans” section in this Note for credit quality information on our PCI portfolio. COMMERCIAL CREDIT QUALITY INDICATORS In addition to monitoring commercial loan concentration risk, we manage a consistent process for assessing commercial loan credit quality. Generally, commercial loans are subject to individual risk assessment using our internal borrower and collateral quality ratings. Our ratings are aligned to Pass and Criticized categories. The Criticized category includes Special Mention, Substandard, and Doubtful categories which are defined by bank regulatory agencies. Table 5.8 provides a breakdown of outstanding commercial loans by risk category. Of the $20.4 billion in criticized commercial and industrial loans and $5.7 billion in criticized commercial real estate (CRE) loans at March 31, 2017 , $2.9 billion and $712 million , respectively, have been placed on nonaccrual status and written down to net realizable collateral value. Table 5.8: Commercial Loans by Risk Category (in millions) Commercial and industrial Real estate mortgage Real estate construction Lease financing Total March 31, 2017 By risk category: Pass $ 308,652 126,215 24,450 17,881 477,198 Criticized 20,423 5,153 592 1,275 27,443 Total commercial loans (excluding PCI) 329,075 131,368 25,042 19,156 504,641 Total commercial PCI loans (carrying value) 177 164 22 — 363 Total commercial loans $ 329,252 131,532 25,064 19,156 505,004 December 31, 2016 By risk category: Pass $ 308,166 126,793 23,408 17,899 476,266 Criticized 22,437 5,315 451 1,390 29,593 Total commercial loans (excluding PCI) 330,603 132,108 23,859 19,289 505,859 Total commercial PCI loans (carrying value) 237 383 57 — 677 Total commercial loans $ 330,840 132,491 23,916 19,289 506,536 Table 5.9 provides past due information for commercial loans, which we monitor as part of our credit risk management practices. Table 5.9: Commercial Loans by Delinquency Status (in millions) Commercial and industrial Real estate mortgage Real estate construction Lease financing Total March 31, 2017 By delinquency status: Current-29 days past due (DPD) and still accruing $ 325,001 130,566 24,969 18,946 499,482 30-89 DPD and still accruing 1,088 119 30 114 1,351 90+ DPD and still accruing 88 11 3 — 102 Nonaccrual loans 2,898 672 40 96 3,706 Total commercial loans (excluding PCI) 329,075 131,368 25,042 19,156 504,641 Total commercial PCI loans (carrying value) 177 164 22 — 363 Total commercial loans $ 329,252 131,532 25,064 19,156 505,004 December 31, 2016 By delinquency status: Current-29 DPD and still accruing $ 326,765 131,165 23,776 19,042 500,748 30-89 DPD and still accruing 594 222 40 132 988 90+ DPD and still accruing 28 36 — — 64 Nonaccrual loans 3,216 685 43 115 4,059 Total commercial loans (excluding PCI) 330,603 132,108 23,859 19,289 505,859 Total commercial PCI loans (carrying value) 237 383 57 — 677 Total commercial loans $ 330,840 132,491 23,916 19,289 506,536 CONSUMER CREDIT QUALITY INDICATORS We have various classes of consumer loans that present unique risks. Loan delinquency, FICO credit scores and LTV for loan types are common credit quality indicators that we monitor and utilize in our evaluation of the appropriateness of the allowance for credit losses for the consumer portfolio segment. Many of our loss estimation techniques used for the allowance for credit losses rely on delinquency-based models; therefore, delinquency is an important indicator of credit quality and the establishment of our allowance for credit losses. Table 5.10 provides the outstanding balances of our consumer portfolio by delinquency status. Table 5.10: Consumer Loans by Delinquency Status (in millions) Real estate 1-4 family first mortgage Real estate 1-4 family junior lien mortgage Credit card Automobile Other revolving credit and installment Total March 31, 2017 By delinquency status: Current-29 DPD $ 240,508 43,422 33,868 59,064 38,885 415,747 30-59 DPD 1,612 286 238 1,007 154 3,297 60-89 DPD 635 137 183 243 95 1,293 90-119 DPD 253 80 160 87 89 669 120-179 DPD 289 99 292 6 33 719 180+ DPD 1,534 275 1 1 29 1,840 Government insured/guaranteed loans (1) 14,529 — — — — 14,529 Total consumer loans (excluding PCI) 259,360 44,299 34,742 60,408 39,285 438,094 Total consumer PCI loans (carrying value) 15,273 34 — — — 15,307 Total consumer loans $ 274,633 44,333 34,742 60,408 39,285 453,401 December 31, 2016 By delinquency status: Current-29 DPD $ 239,061 45,238 35,773 60,572 39,833 420,477 30-59 DPD 1,904 296 275 1,262 177 3,914 60-89 DPD 700 160 200 330 111 1,501 90-119 DPD 307 102 169 116 93 787 120-179 DPD 323 108 279 5 30 745 180+ DPD 1,661 297 4 1 22 1,985 Government insured/guaranteed loans (1) 15,605 — — — — 15,605 Total consumer loans (excluding PCI) 259,561 46,201 36,700 62,286 40,266 445,014 Total consumer PCI loans (carrying value) 16,018 36 — — — 16,054 Total consumer loans $ 275,579 46,237 36,700 62,286 40,266 461,068 (1) Represents loans whose repayments are predominantly insured by the FHA or guaranteed by the VA. Loans insured/guaranteed by the FHA/VA and 90+ DPD totaled $9.2 billion at March 31, 2017 , compared with $10.1 billion at December 31, 2016 . Of the $3.2 billion of consumer loans not government insured/guaranteed that are 90 days or more past due at March 31, 2017 , $838 million was accruing, compared with $3.5 billion past due and $908 million accruing at December 31, 2016 . Real estate 1-4 family first mortgage loans 180 days or more past due totaled $1.5 billion , or 0.6% of total first mortgages (excluding PCI), at March 31, 2017 , compared with $1.7 billion , or 0.6% , at December 31, 2016 . Table 5.11 provides a breakdown of our consumer portfolio by FICO. The March 31, 2017 FICO scores for real estate 1-4 family first and junior lien mortgages reflect a new FICO score version we adopted in first quarter 2017 to monitor and manage those portfolios. In general the impact for us is a shift to higher scores, particularly to the 800+ level, as the new FICO score version utilizes a more refined approach that better distinguishes borrower credit risk. Most of the scored consumer portfolio has an updated FICO of 680 and above, reflecting a strong current borrower credit profile. FICO is not available for certain loan types, or may not be required if we deem it unnecessary due to strong collateral and other borrower attributes. Substantially all loans not requiring a FICO score are securities-based loans originated through retail brokerage, and totaled $7.9 billion at March 31, 2017 , and $8.0 billion at December 31, 2016 . Table 5.11: Consumer Loans by FICO (in millions) Real estate 1-4 family first mortgage (1) Real estate 1-4 family junior lien mortgage (1) Credit card Automobile Other revolving credit and installment (1) Total March 31, 2017 By FICO: < 600 $ 6,260 2,123 3,352 9,906 947 22,588 600-639 4,256 1,501 2,943 6,393 1,009 16,102 640-679 8,081 2,934 5,371 9,763 2,158 28,307 680-719 16,503 5,663 7,080 10,826 3,899 43,971 720-759 28,250 7,106 7,339 8,525 5,407 56,627 760-799 51,813 7,993 5,823 7,945 6,614 80,188 800+ 124,534 16,237 2,792 6,720 8,682 158,965 No FICO available 5,134 742 42 330 2,643 8,891 FICO not required — — — — 7,926 7,926 Government insured/guaranteed loans (2) 14,529 — — — — 14,529 Total consumer loans (excluding PCI) 259,360 44,299 34,742 60,408 39,285 438,094 Total consumer PCI loans (carrying value) 15,273 34 — — — 15,307 Total consumer loans $ 274,633 44,333 34,742 60,408 39,285 453,401 December 31, 2016 By FICO: < 600 $ 6,720 2,591 3,475 9,934 976 23,696 600-639 5,400 1,917 3,109 6,705 1,056 18,187 640-679 10,975 3,747 5,678 10,204 2,333 32,937 680-719 23,300 6,432 7,382 11,233 4,302 52,649 720-759 38,832 9,413 7,632 8,769 5,869 70,515 760-799 103,608 14,929 6,191 8,164 8,348 141,240 800+ 49,508 6,391 2,868 6,856 6,434 72,057 No FICO available 5,613 781 365 421 2,906 10,086 FICO not required — — — — 8,042 8,042 Government insured/guaranteed loans (2) 15,605 — — — — 15,605 Total consumer loans (excluding PCI) 259,561 46,201 36,700 62,286 40,266 445,014 Total consumer PCI loans (carrying value) 16,018 36 — — — 16,054 Total consumer loans $ 275,579 46,237 36,700 62,286 40,266 461,068 (1) The March 31, 2017 , amounts reflect updated FICO score version implemented in first quarter 2017. (2) Represents loans whose repayments are predominantly insured by the FHA or guaranteed by the VA. LTV refers to the ratio comparing the loan’s unpaid principal balance to the property’s collateral value. CLTV refers to the combination of first mortgage and junior lien mortgage (including unused line amounts for credit line products) ratios. LTVs and CLTVs are updated quarterly using a cascade approach which first uses values provided by automated valuation models (AVMs) for the property. If an AVM is not available, then the value is estimated using the original appraised value adjusted by the change in Home Price Index (HPI) for the property location. If an HPI is not available, the original appraised value is used. The HPI value is normally the only method considered for high value properties, generally with an original value of $1 million or more, as the AVM values have proven less accurate for these properties. Table 5.12 shows the most updated LTV and CLTV distribution of the real estate 1-4 family first and junior lien mortgage loan portfolios. We consider the trends in residential real estate markets as we monitor credit risk and establish our allowance for credit losses. In the event of a default, any loss should be limited to the portion of the loan amount in excess of the net realizable value of the underlying real estate collateral value. Certain loans do not have an LTV or CLTV due to industry data availability and portfolios acquired from or serviced by other institutions. Table 5.12: Consumer Loans by LTV/CLTV March 31, 2017 December 31, 2016 (in millions) Real estate 1-4 family first mortgage by LTV Real estate 1-4 family junior lien mortgage by CLTV Total Real estate 1-4 family first mortgage by LTV Real estate 1-4 family junior lien mortgage by CLTV Total By LTV/CLTV: 0-60% $ 121,653 16,024 137,677 121,430 16,464 137,894 60.01-80% 101,956 14,651 116,607 101,726 15,262 116,988 80.01-100% 16,506 8,312 24,818 15,795 8,765 24,560 100.01-120% (1) 2,459 3,339 5,798 2,644 3,589 6,233 > 120% (1) 1,025 1,482 2,507 1,066 1,613 2,679 No LTV/CLTV available 1,232 491 1,723 1,295 508 1,803 Government insured/guaranteed loans (2) 14,529 — 14,529 15,605 — 15,605 Total consumer loans (excluding PCI) 259,360 44,299 303,659 259,561 46,201 305,762 Total consumer PCI loans (carrying value) 15,273 34 15,307 16,018 36 16,054 Total consumer loans $ 274,633 44,333 318,966 275,579 46,237 321,816 (1) Reflects total loan balances with LTV/CLTV amounts in excess of 100%. In the event of default, the loss content would generally be limited to only the amount in excess of 100% LTV/CLTV. (2) Represents loans whose repayments are predominantly insured by the FHA or guaranteed by the VA. NONACCRUAL LOANS Table 5.13 provides loans on nonaccrual status. PCI loans are excluded from this table because they continue to earn interest from accretable yield, independent of performance in accordance with their contractual terms. Table 5.13: Nonaccrual Loans (in millions) Mar 31, Dec 31, Commercial: Commercial and industrial $ 2,898 3,216 Real estate mortgage 672 685 Real estate construction 40 43 Lease financing 96 115 Total commercial 3,706 4,059 Consumer: Real estate 1-4 family first mortgage (1) 4,743 4,962 Real estate 1-4 family junior lien mortgage 1,153 1,206 Automobile 101 106 Other revolving credit and installment 56 51 Total consumer 6,053 6,325 Total nonaccrual loans (excluding PCI) $ 9,759 10,384 (1) Includes MHFS of $145 million and $149 million at March 31, 2017 , and December 31, 2016 , respectively. LOANS IN PROCESS OF FORECLOSURE Our recorded investment in consumer mortgage loans collateralized by residential real estate property that are in process of foreclosure was $7.8 billion and $8.1 billion at March 31, 2017 and December 31, 2016 , respectively, which included $4.7 billion and $4.8 billion , respectively, of loans that are government insured/guaranteed. We commence the foreclosure process on consumer real estate loans when a borrower becomes 120 days delinquent in accordance with Consumer Finance Protection Bureau Guidelines. Foreclosure procedures and timelines vary depending on whether the property address resides in a judicial or non-judicial state. Judicial states require the foreclosure to be processed through the state’s courts while non-judicial states are processed without court intervention. Foreclosure timelines vary according to state law. LOANS 90 DAYS OR MORE PAST DUE AND STILL ACCRUING Certain loans 90 days or more past due as to interest or principal are still accruing, because they are (1) well-secured and in the process of collection or (2) real estate 1-4 family mortgage loans or consumer loans exempt under regulatory rules from being classified as nonaccrual until later delinquency, usually 120 days past due. PCI loans of $1.8 billion at March 31, 2017 , and $2.0 billion at December 31, 2016 , are not included in these past due and still accruing loans even when they are 90 days or more contractually past due. These PCI loans are considered to be accruing because they continue to earn interest from accretable yield, independent of performance in accordance with their contractual terms. Table 5.14 shows non-PCI loans 90 days or more past due and still accruing by class for loans not government insured/guaranteed. Table 5.14: Loans 90 Days or More Past Due and Still Accruing (in millions) Mar 31, 2017 Dec 31, 2016 Total (excluding PCI): $ 10,525 11,858 Less: FHA insured/guaranteed by the VA (1)(2) 9,585 10,883 Less: Student loans guaranteed under the Federal Family Education Loan Program (FFELP) (3) — 3 Total, not government insured/guaranteed $ 940 972 By segment and class, not government insured/guaranteed: Commercial: Commercial and industrial $ 88 28 Real estate mortgage 11 36 Real estate construction 3 — Total commercial 102 64 Consumer: Real estate 1-4 family first mortgage (2) 149 175 Real estate 1-4 family junior lien mortgage (2) 42 56 Credit card 453 452 Automobile 79 112 Other revolving credit and installment 115 113 Total consumer 838 908 Total, not government insured/guaranteed $ 940 972 (1) Represents loans whose repayments are predominantly insured by the FHA or guaranteed by the VA. (2) Includes mortgages held for sale 90 days or more past due and still accruing. (3) Represents loans whose repayments are largely guaranteed by agencies on behalf of the U.S. Department of Education under the FFELP. All remaining student loans guaranteed under the FFELP were sold as of March 31, 2017. IMPAIRED LOANS Table 5.15 summarizes key information for impaired loans. Our impaired loans predominantly include loans on nonaccrual status in the commercial portfolio segment and loans modified in a TDR, whether on accrual or nonaccrual status. These impaired loans generally have estimated losses which are included in the allowance for credit losses. We have impaired loans with no allowance for credit losses when loss content has been previously recognized through charge-offs and we do not anticipate additional charge-offs or losses, or certain loans are currently performing in accordance with their terms and for which no loss has been estimated. Impaired loans exclude PCI loans. Table 5.15 includes trial modifications that totaled $261 million at March 31, 2017 , and $299 million at December 31, 2016 . For additional information on our impaired loans and allowance for credit losses, see Note 1 (Summary of Significant Accounting Policies) in our 2016 Form 10-K. Table 5.15: Impaired Loans Summary Recorded investment (in millions) Unpaid principal balance (1) Impaired loans Impaired loans with related allowance for credit losses Related allowance for credit losses March 31, 2017 Commercial: Commercial and industrial $ 4,833 3,508 3,158 571 Real estate mortgage 1,722 1,393 1,393 236 Real estate construction 134 73 73 14 Lease financing 149 102 102 38 Total commercial 6,838 5,076 4,726 859 Consumer: Real estate 1-4 family first mortgage 15,891 13,872 9,075 996 Real estate 1-4 family junior lien mortgage 2,339 2,106 1,628 326 Credit card 308 308 308 107 Automobile 146 80 29 7 Other revolving credit and installment 117 109 99 18 Total consumer (2) 18,801 16,475 11,139 1,454 Total impaired loans (excluding PCI) $ 25,639 21,551 15,865 2,313 December 31, 2016 Commercial: Commercial and industrial $ 5,058 3,742 3,418 675 Real estate mortgage 1,777 1,418 1,396 280 Real estate construction 167 93 93 22 Lease financing 146 119 119 23 Total commercial 7,148 5,372 5,026 1,000 Consumer: Real estate 1-4 family first mortgage 16,438 14,362 9,475 1,117 Real estate 1-4 family junior lien mortgage 2,399 2,156 1,681 350 Credit card 300 300 300 104 Automobile 153 85 31 5 Other revolving credit and installment 109 102 91 17 Total consumer (2) 19,399 17,005 11,578 1,593 Total impaired loans (excluding PCI) $ 26,547 22,377 16,604 2,593 (1) Excludes the unpaid principal balance for loans that have been fully charged off or otherwise have zero recorded investment. (2) Includes the recorded investment of $1.5 billion at both March 31, 2017 and December 31, 2016 , of government insured/guaranteed loans that are predominantly insured by the FHA or guaranteed by the VA and generally do not have an allowance. Impaired loans may also have limited, if any, allowance when the recorded investment of the loan approximates estimated net realizable value as a result of charge-offs prior to a TDR modification. Commitments to lend additional funds on loans whose terms have been modified in a TDR amounted to $630 million and $403 million at March 31, 2017 and December 31, 2016 , respectively. Table 5.16 provides the average recorded investment in impaired loans and the amount of interest income recognized on impaired loans by portfolio segment and class. Table 5.16: Average Recorded Investment in Impaired Loans Quarter ended March 31, 2017 2016 (in millions) Average recorded investment Recognized interest income Average recorded investment Recognized interest income Commercial: Commercial and industrial $ 3,675 33 2,766 19 Real estate mortgage 1,394 27 1,772 32 Real estate construction 84 1 130 2 Lease financing 119 — 75 — Total commercial 5,272 61 4,743 53 Consumer: Real estate 1-4 family first mortgage 14,132 190 16,911 221 Real estate 1-4 family junior lien mortgage 2,131 31 2,382 34 Credit card 302 8 297 9 Automobile 83 3 101 3 Other revolving credit and installment 106 2 82 1 Total consumer 16,754 234 19,773 268 Total impaired loans (excluding PCI) $ 22,026 295 24,516 321 Interest income: Cash basis of accounting $ 78 95 Other (1) 217 226 Total interest income $ 295 321 (1) Includes interest recognized on accruing TDRs, interest recognized related to certain impaired loans which have an allowance calculated using discounting, and amortization of purchase accounting adjustments related to certain impaired loans. TROUBLED DEBT RESTRUCTURINGS (TDRs) When, for economic or legal reasons related to a borrower’s financial difficulties, we grant a concession for other than an insignificant period of time to a borrower that we would not otherwise consider, the related loan is classified as a TDR, the balance of which totaled $20.1 billion and $20.8 billion at March 31, 2017 and December 31, 2016 , respectively. We do not consider loan resolutions such as foreclosure or short sale to be a TDR. We may require some consumer borrowers experiencing financial difficulty to make trial payments generally for a period of three to four months, according to the terms of a planned permanent modification, to determine if they can perform according to those terms. These arrangements represent trial modifications, which we classify and account for as TDRs. While loans are in trial payment programs, their original terms are not considered modified and they continue to advance through delinquency status and accrue interest according to their original terms. Table 5.17 summarizes our TDR modifications for the periods presented by primary modification type and includes the financial effects of these modifications. For those loans that modify more than once, the table reflects each modification that occurred during the period. Loans that both modify and pay off within the period, as well as changes in recorded investment during the period for loans modified in prior periods, are not included in the table. Table 5.17: TDR Modifications Primary modification type (1) Financial effects of modifications (in millions) Principal (2) Interest rate reduction Other concessions (3) Total Charge- offs (4) Weighted average interest rate reduction Recorded investment related to interest rate reduction (5) Quar |