DISCLOSURE NOTICE
IMPORTANT TERMS of our HOME EQUITY LINE OF CREDIT
IBM Southeast Employees' Federal Credit Union
P. O. Box 5090, Boca Raton, Florida 33431-0890
(800) 873-5100, Ext. 7722, or (561) 982-7722
www.ibmsecu.org - mortgage@ibmsecu.org
Retention Information : This disclosure contains important information about our Home Equity Line of Credit . 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 you have paid to us or anyone else in connection with your application.
Security Interest : We will take a mortgage on 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 and require you to pay us the entire outstanding balance in one payment, refuse to make additional extensions of credit or
reduce your credit limit if:
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You engage in fraud or material misrepresentation in connection with the line.
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You do not meet the repayment terms.
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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:
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The value of the dwelling securing the line declines significantly below its appraised value for purposes of the line.
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We reasonably believe you will not be able to meet the repayment requirements due to a material change in your financial
status.
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You are in default of a material obligation in the agreement.
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Government action prevents us from imposing the Annual Percentage Rate or impairs our security interest such that the value
of the interest is less than 120 percent of the credit line.
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A regulatory agency has notified us that continued advances would constitute an unsafe, unsound practice.
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The maximum Annual Percentage Rate is reached.
Minimum Payment Requirements : You can obtain advances of credit for 15 years (the "Draw Period"). During the draw period, payments will be due monthly.
If you have an unpaid principal balance, your minimum monthly payment for any month in the draw period will equal the greater of:
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(a) $50.00, or
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(b) either (i) if the outstanding Principal Balance at the end of the last day a credit advance was posted to your line before the
end of that month exceeds $15,000.00, 1.4% of that outstanding Principal Balance, or
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(b) (ii) if that outstanding Principal Balance does not exceed $15,000.00, 2% of that outstanding Principal Balance.
After the draw period ends, you will no longer be able to obtain credit advances and must repay the outstanding Balance (the "Repayment Period"). The length
of the repayment period is indefinite and will depend on when the last credit advance was posted to your line, the outstanding Principal Balance at that time and the Annual
Percentage Rate for your line. During the repayment period, payments will be due monthly. If you have an unpaid principal balance, your minimum monthly payment
for any month in the repayment period will equal the greater of:
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(a) $50.00, or
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(b) either (i) if the outstanding Principal Balance at the end of the last day a credit advance was posted to your line exceeds
$15,000.00, 1.4% of that outstanding Principal Balance, or
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(b) (ii) if that outstanding Principal Balance does not exceed $15,000.00, 2% of that outstanding Principal Balance.
Minimum Payment Example : If you made only the minimum monthly payments and took no other credit advances, it would take 5 years and 10 months to pay off a
credit advance of $10,000.00 at an Annual Percentage Rate of 11.75%. During that period, you would make 69 payments of $200.00, followed by one final payment of
$3.90.
Fees and Charges :
[ ] Option A - You must pay certain fees to third parties to open a line. These fees generally total between $670.00 (for a $7,500.00
line) and $1,650.00 (for a $100,000.00 line). If you ask, we will give you an itemization of the fees you will have to pay to third parties.
[ ] Option B - The Credit Union will pay all Closing Costs.
Insurance : You must carry hazard and flood insurance, if applicable, on the property that secures the line. Other applicable insurances may be required.
Tax Deductibility : You should consult a tax advisor regarding the deductibility of interest and charges for the line.
Variable-Rate Information : The line has a variable-rate feature, and the Annual Percentage Rate (corresponding to the periodic rate) and the minimum monthly
payment can change as a result. 00/span>
The Annual Percentage Rate includes only interest and not other costs.
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The Annual Percentage Rate is based on the value of an index. The Index is the highest Prime Rate published on the first
business day of the quarter in the Wall Street Journal "Monthly Rates" Table.
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Ask us for the current Index Value and Annual Percentage Rate. After you open a credit line, rate information will be
provided on periodic statements that we will send you.
Rate Changes : The Annual Percentage Rate can change quarterly. The Interest Rate will be the highest Prime Rate published on the first business day of the quarter in
the Wall Street Journal "Monthly Rates" Table. The rates available for this line will be posted on the prevailing Rate Sheet, and can change periodically under the program.
The maximum Annual Percentage Rate that can apply is 15.00% . Except for this 15.00% "Cap", there is no limit on the amount by which the rate can change during any
one-year period. The minimum Annual Percentage Rate that can apply is 4.00% .
Credit Limit : Once your credit limit is approved, and your loan closed, the limit will remain fixed for the life of the loan, unless modified.
Maximum Rate and Payment Examples : If you had an outstanding Principal Balance of $10,000.00, the largest minimum monthly payment at the maximum Annual
Percentage Rate of 15.00% would be $200.00. This Annual Percentage Rate could be reached during the first month of the draw period.
Late Charge : If you fail to pay at least the minimum payment within ten (10) days after it is due, a late charge of 5% of the past due payment amount of Principal and
Interest will be assessed.
Surrender Fee : For loan amounts $100,000.00 or less the Credit Union will pay Closing Costs "One Time" on the same property within a three (3)-year period. If the
Credit Union paid the Closing Costs and the Home Equity Line of Credit is paid off and closed within the first three (3) years of the loan, the Borrower will pay a $300.00
Surrender Fee at the time of payoff.
Historical Example : The following table shows how the Annual Percentage Rate and the minimum monthly payments for a single $10,000.00 credit advance would
have changed based on changes in the index over the past 15 years. The Index Values are from April 1 of each year. The table assumes that no additional credit advances
were taken, that only the minimum payments were made each month, and that the rate remained constant during each year. It does not necessarily indicate how the index or
your payments will change in the future.
ANNUAL
Minimum
ANNUAL
Minimum
P
ER CENT AGE
Monthly
PERCENTAGE
Monthly
Year
Index RATE Payments Year Index RATE Payments
(%) (%) ($) (%) (%) ($)
1989
11.50 11.50 200.00 1997 8.50 8.50 200.00
1990
10.00 10.00 200.00 1998 8.50 8.50 200.00
1991
10.00 10.00 200.00 1999 7.75 7.75 200.00
1992
6.50 6.50 200.00 2000 9.00 9.00 200.00
1993
6.00 6.00 200.00 2001 8.00 8.00 200.00
1994
6.25 6.25 200.00 2002 4.75 4.75 200.00
1995
9.00 9.00 200.00 2003 4.00 4.00 200.00
1996 8.25 8.25 200.00
These disclosures are required by Federal law. These disclosures describe a Home Equity Line of Credit in very general terms and do not take into account other charges
that may apply to a Home Equity Line of Credit, such as charges for group credit insurance and late charges. The minimum payment, maximum rate and payment and
historical examples set forth in these disclosures are based on the assumption that the only payments made in connection with the line are minimum monthly payments, that
each minimum monthly payment is made on the date it is billed and that a year consists of 12 months of 30 days each.
I/We acknowledge receipt of this disclosure and a copy of the Home Equity brochure or comparable publication provided by Lender.
(Recipient) (Date) (Recipient) (Date)
White - Credit Union
IBS #A778 (R04/04)
Yellow - Member
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