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CORRESP
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filename1.htm

    hb_corresp0131.htm

    Via
      EDGAR

    January
      31, 2008

    Mr.
      Kevin
      W. Vaughn

    Accounting
      Branch Chief

    Securities
      and Exchange Commission

    Division
      of Corporation Finance

    100
      F
      Street, NE

    Washington,
      D.C. 20549

    Mail
      Stop
      - 4561

    Re:  Horizon
      Bancorp Form

    10-K
      for
      Fiscal Year Ended December 31, 2006

    Filed
      March 23, 2007,  File No. 000-10792

    Dear
      Mr.
      Vaughn

    This
      correspondence is Horizon Bancorp’s response to the follow-up comment received
      from the Securities and Exchange Commission on January 21, 2008, regarding
      the
      above-referenced filing and Horizon Bancorp's response to the initial comment
      letter dated December 31, 2007.

    As
      we
      have discussed with Michael Volley, we will revise the discussion of Mortgage
      Warehouse Loans in both the Management’s Discussion and Analysis (Item 7) and in
      Note 1 – Nature of Operations and Summary of Significant Accounting Policies in
      Item 8 of future 10-K filings as follows:

    Horizon’s
      mortgage warehousing business line has specific mortgage companies as customers
      of Horizon Bank.  Individual mortgage loans originated by these
      mortgage companies are funded as a secured borrowing with pledge of collateral
      under Horizon’s agreement with the mortgage company.  Each individual
      mortgage is assigned to Horizon until the loan is sold to the secondary market
      by the mortgage company.  In addition, Horizon takes possession of
      each original note and forwards such note to the end investor once the mortgage
      company has sold the loan.  At the time a loan is transferred to the
      secondary market, the mortgage company repurchases the loan under its option
      within the agreement.  Due to the repurchase feature contained in the
      agreement, the transaction does not qualify as a sale under SFAS 140 paragraph
      9
      (c) and therefore is accounted for as a secured borrowing with pledge of
      collateral under paragraph 12 of SFAS 140 pursuant to the agreement with the
      mortgage company. When the individual loan is sold to the end investor by the
      mortgage company the proceeds from the sale of the loan are received by Horizon
      and used to payoff the loan balance with Horizon along with any accrued interest
      and any related fees.  The remaining balance from the sale is
      forwarded to the mortgage company.  These individual loans typically
      are sold by the mortgage company within 30 days and are seldom held more than
      90
      days.  Interest income is accrued during this period and collected at
      the time each loan is sold.  Fee income for each loan sold is recorded
      when collected and no costs are deferred due to the term between each loan
      funding and related payoff is typically less than 30 days.

    Based
      on
      the agreements with each mortgage company, at any time a mortgage company can
      repurchase from Horizon their outstanding loan balance on an individual mortgage
      and regain possession of the original note.  Horizon also has the
      option to request that the mortgage company

      515
        FRANKLIN SQUARE, MICHIGAN CITY, INDIANA  46360

      219-879-0211

              Page
                2

                 January
                  31,
                  2008

    repurchase
      an individual mortgage. Should this occur, Horizon would return the original
      note and reassign the assignment of the mortgage to the mortgage company. Also,
      in the event that the end investor would not be able to honor the sales
      commitment and the mortgage company would not be able to repurchase its loan
      on
      an individual mortgage, Horizon would be able to exercise its rights under
      the
      agreement.

    If
      you
      have any questions regarding the responses above, please contact the undersigned
      at (219) 873-2608.

    Sincerely,

    /s/
James
      H. Foglesong

    James
      H.
      Foglesong

    Chief
      Financial Officer

    Horizon
      Bancorp