| |
Initial 1 Year Fixed Rate
HOME EQUITY EARLY DISCLOSURE
IMPORTANT TERMS OF OUR HOME EQUITY LINE OF CREDIT PLAN
This disclosure contains important information about our Home Equity Line of
Credit Plan. You should read it carefully and keep a copy for your records.
AVAILABILITY OF TERMS: All of the terms described
below are subject to change. If these terms change (other than the annual
percentage rate) and you decide, as a result, not to enter into an agreement
with us, you are entitled to a refund of any fees that you pay to us or
anyone else in connection with your application.
SECURITY INTEREST: We will take a security
interest in your home. You could lose your home if you do not meet the
obligations in your agreement with us.
POSSIBLE ACTIONS: We can terminate your line,
require you to pay us the entire outstanding balance in one payment, and
charge you certain fees, if (1) you engage in fraud or material misrepresentation
in connection with the plan; (2) you do not meet the repayment terms of
this plan, or (3) your action or inaction adversely affects the collateral
or our rights in the collateral.
We can refuse to make additional extensions of credit or reduce your credit limit
if (1) any reasons mentioned above exist; (2) the value of the swelling securing
the line declines significantly below its appraised value for purposes of the
line; (3) we reasonable believe that you will not be able to meet the repayment
requirements due to a material change in your financial circumstances; (4) you
are in default of a material obligation of the agreement; (5) government action
prevents us from imposing the annual percentage rate provided for in the agreement;
(6) the priority of our security interest is adversely affected by government
action to the extent that the value of the security interest is less than 120
percent of the credit line; (7) a regulator agency has notified us that continued
advances would constitute an unsafe and unsound business practice, or (8) the
maximum percentage rate is reached.
MINIMUM PAYMENT REQUIREMENTS: You can obtain
credit advances for 7 years. This period is called the "draw period." At
our option, we may renew or extend the draw period. After the draw period
ends the repayment period will begin. The length of the repayment period
will depend on the balance at the time of the last advance you obtain before
the draw period ends. You will be required to make monthly payments during
both the draw and repayment periods. At the time you obtain a credit advance
a payoff period of 180 monthly payments will be used to calculate your
payment.
The payoff period will always be the shorter of the payoff period for your outstanding
balance or the time remaining to the maturity date. Your payment will be set
to repay the balance after the advance, at the current annual percentage rate,
within the payoff period. Your payment will be rounded up to the nearest dollar.
Your payment will remain the same unless you obtain another credit advance. You
payment may also change if the annual percentage rate increases. Each time the
annual percentage rate increases we will review the effect the increase has had
on your plan. If the annual percentage rate has increased so much that your payment
is not sufficient to repay the balance within the payoff period, we will adjust
your payment to repay the balance within the original payoff period. Your payment
will include any amounts past due and any amount by which you have exceeded your
credit limit, and all other charges. Your payment will never be less than the
smaller of $100.00, or the full amount that you owe.
MINIMUM PAYMENT EXAMPLE: If you made only the
minimum monthly payment and took no other credit advances it would take 15
years to pay off a credit advance of $10,000 at an ANNUAL PERCENTAGE RATE of
9.25%. During that period, you would make 180 payments of $103.00.
FEES AND CHARGES: In order to open, use and
maintain a line of credit plan, you must pay the following fees to us:
Flood Determination Fee: $17.00 (Due at closing)
You must pay certain fees to third parties to open the plan. These fees generally
total between $500.00 and $1,050.00. If you ask, we will provide you with an
itemization of the fees you will have to pay third parties.
PROPERTY INSURANCE: You must carry insurance
on the property that secures this plan. If the property is located in a
Special Flood Hazard Area we will require you to obtain flood insurance
if it is available.
REFUNDABILITY OF FEES: If you decide not to
enter into this plan within three business days of receiving this disclosure
and the home equity brochure, you are entitled to a refund of any fee you
may have already paid.
TRANSACTION REQUIREMENTS: The minimum credit
advance that you can receive is $5,000.00 for the first advance and $1,000.00
for each subsequent advance.
TAX DEDUCTIBILITY: You should consult a tax
advisor regarding the deductibility of interest and charges for the plan.
ADDITIONAL HOME EQUITY PLANS: Please ask us
about our other available home equity line of credit plans.
VARIABLE RATE FEATURE: This plan has a variable
rate feature and the annual percentage rate (corresponding to the periodic
rate) and the minimum payment may change as a result. The annual percentage
rate includes only interest and no other costs.
The annual percentage rate is based on the value of an index. The index is the
weekly Three Month Treasury Bill Rate (Auction High). Information about the index
is published in the Wall Street Journal and is also available from the Treasury
Dept. website: www.publicdebt.treas.gov.
We will use the most recent index value available to us as of 45 days before
the date of any annual percentage rate adjustment.
To determine the annual percentage rate that will apply to your account, we add
a margin to the value of the Index. If the rate is not already rounded we then
round up to the next .25%.
The initial annual percentage rate is "discounted" - it is not based
on the index and margin used for later rate adjustments. The initial rate will
be in effect for 12 months. Ask us for the current index value, margin and annual
percentage rate. After you open a plan, rate information will be provided on
periodic statements that we send you.
RATE CHANGES: The annual percentage rate can
change quarterly on the first day of January, April, July and October.
There is no limit on the amount by which the annual percentage rate can
change during any one year period. The maximum ANNUAL PERCENTAGE RATE that
can apply is 15% or the maximum permitted by law, whichever is less. However,
under no circumstances will your ANNUAL PERCENTAGE RATE go below
5% at any time during the term of the plan.
MAXIMUM RATE AND PAYMENT EXAMPLES: If you had
an outstanding balance of $10,000, the minimum payment at the maximum ANNUAL
PERCENTAGE RATE of 15% would be $140.00. This annual percentage rate
could be reached at the time of the 13th payment.
HISTORICAL EXAMPLE: The following table shows
how the annual percentage rate and the minimum payments for a single $10,000
credit advance would have changed based on changes in the index over the
past 15 years. The index values are from the first week ending in January
of each year. While only one payment per year is shown, payments may have
varied during each year.
The table assumes that no additional credit advances were taken, that only the
minimum payments were made, and that the rate remained constant during each year.
It does not necessarily indicate how the index or your payments will change in
the future.
Year
(as of the first week ending in January) |
Index
(Percent) |
Margin (1)
(Percent) |
ANNUAL
PERCENTAGE
RATE |
Monthly
Payment
(Dollars) |
| 1987 |
5.680 |
3.50 |
6.00 (2) |
100.00(3) |
| 1988 |
5.730 |
3.50 |
9.250 |
100.00 |
| 1989 |
8.240 |
3.50 |
11.750 |
114.00 |
| 1990 |
7.640 |
3.50 |
11.250 |
114.00 |
| 1991 |
6.520 |
3.50 |
10.250 |
114.00 |
| 1992 |
3.910 |
3.50 |
7.500 |
114.00 |
| 1993 |
3.220 |
3.50 |
6.750 |
114.00 |
| 1994 |
3.100 |
3.50 |
6.750 |
114.00 |
| 1995 |
5.780 |
3.50 |
9.500 |
114.00 |
| 1996 |
5.040 |
3.50 |
8.750 |
114.00 |
| 1997 |
5.080 |
3.50 |
8.750 |
114.00 |
| 1998 |
5.290 |
3.50 |
9.000 |
114.00 |
| 1999 |
4.520 |
3.50 |
8.250 |
114.00 |
| 2000 |
5.360 |
3.50 |
9.000 |
 |
| 2001 |
5.700 |
3.50 |
9.250 |
|
(
|
|
|
