GLENVIEW STATE BANK
IMPORTANT TERMS OF OUR HOME EQUITY LINE OF CREDIT. INITIAL DISCLOSURE STATEMENT
This disclosure contains important information about our Home Equity Line of Credit (the "Plan"). You should read it carefully and keep a copy for your records.
AVAILABILITY OF TERMS
To obtain the terms described below, you must submit your application within 1 month from the date you received this disclosure. The terms in this disclosure are subject to change, however if any of the 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 paid 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:
Under this Plan, we have the following rights: We can terminate your account, require you to pay us the entire outstanding balance in one payment, and charge you certain fees if:
- You engage in fraud or material misrepresentation in connection with the Plan.
- You do note meet the repayment terms of the Plan.
- Your action or inaction adversely affects the collateral for the Plan or our rights in the collateral.
We can refuse to make additional extensions of credit or reduce your credit limit if:
- The value of the dwelling securing the Plan declines significantly below its appraised value for purposes of the Plan.
- We reasonably believe you will not be able to meet the repayment requirements due to a material change in your financial circumstances.
- You are in default of a material obligation of the Plan.
- Government action prevents us from imposing the annual percentage rate provided for under the Plan or impairs our security interest such that the value of the interest is less than 120 percent of the credit line.
- A government authority has notified us that continued advances would constitute an unsafe business practice.
- The maximum annual percentage rate is reached.
The initial agreement permits us to make changes to the terms of the Plan at specified times or upon the occurrence of specified events.
Fees and Charges.
In order to open and maintain an account, you must pay certain fees and charges.
| Lender Fees. The following fees must be paid to us: | ||
| Description | Amount | When Charged |
|---|---|---|
| Application Fee | $300 to cover the cost of Flood Certification ($10.00), Doc Prep Fees ($40.00), Title Insurance ($55.00), Credit Report ($20.00) and Appraisal ($175.00) |
After preapproval, prior to processing your loan. |
| Annual Fee | $50.00 | Waived during the first year, then annually, beginning one year after the contract date of your loan |
| Administrative Fees: | Variable, as you may have to pay a fee to the Bank in connection with such matters as NSF ("bounced") checks, photocopies of checks and statements; stop payment orders; and printing of checks. These administrative fees may vary from time to time and the amounts would be provided to you upon request. | Upon Each Occurrence |
| Third Party Fees. You must pay certain fees to third parties such as appraisers, credit reporting firms, and government agencies. | ||
| These third party fees generally total between $0.00 and $1,000.00. Upon request, we will provide you with an itemization of the fees you will have to pay to third parties. | ||
PROPERTY INSURANCE.
You must carry insurance on the property that secures the Plan.
MINIMUM PAYMENT REQUIREMENTS
You can obtain advances of credit during the following period: the draw period will be for five (5) years (the "Draw Period"). Your Regular Payment will equal the amount of your accrued FINANCE CHARGES. You will make 59 of these payments. You will then be required to pay the entire balance owing in a single balloon payment. If you make only the minimum payments, you may not repay any of the principal balance by the end of this payment stream. Your payments will be due monthly. Your "Minimum Payment" will be the Regular Payment, plus any amount due and all other charges. An increase in the ANNUAL PERCENTAGE RATE may increase the amount of your Regular Payment.
MINIMUM PAYMENT EXAMPLE
If you made only the minimum payment and took no other credit advances, it would take 5 years to pay off a credit advance of $10,000 at an ANNUAL PERCENTAGE RATE OF 4.500%. During that period, you would make 59 monthly payments ranging from $34.52 to $38.22 and one final payment of $10,038.22.
TRANSACTION REQUIREMENTS
The following transaction limitations will apply to the use of your Credit Line:
Credit Line Preferred Check and HOMEBanker Transfers Limitations:
There are no transaction limitations for the writing of Preferred Checks or accessing by other methods.
TAX DEDUCTIBILITY
You should consult a tax advisor regarding the deductibility of interest and charges for the Plan.
VARIABLE RATE FEATURE
The Plan has a variable rate feature. The ANNUAL PERCENTAGE RATE (corresponding to the periodic rate), and the minimum payment amount can change as a result. The ANNUAL PERCENTAGE RATE does not include costs other than interest.
THE INDEX
The annual percentage rate is based on the value of an Index (referred to in this disclosure as the "Index"). The Index is the prime rate as published in the Money Rates section of the Wall Street Journal for such date (the "Index Rate"). Where the Index Rate is shown on any day as a range of values, the higher rate indicated for such day shall be used as the Index Rate for such day. Should the Prime Rate cease to be quoted in the Wall Street Journal, then the Index Rate shall instead be an index selected by Lender, so long as the historical fluctuations were substantially similar to those of the prime rate which was published in the Wall Street Journal, and produces an interest rate substantially similar to the interest rate that was in effect when the prime rate ceased to be quoted in the Wall Street Journal. If the index selected by Lender is newly establish, it need only meet the latter criteria to become effective. Information about the Index is available or published in the Wall Street Journal. We will use the most recent index value available to us as of daily any annual percentage rate adjustment. If the index is no longer available, we will choose a new index and margin. The new Index will have an historical movement substantially similar to the original index, and the new index and margin will result in an annual percentage rate that is substantially similar to the rate in effect at the time the original index becomes unavailable.
ANNUAL PERCENTAGE RATE
To determine the Periodic Rate that will apply to your account, we add a margin to the value of the Index, then divide the value by the number of days in a year (daily). To obtain the ANNUAL PERCENTAGE RATE, we multiply the Periodic Rate by the number of days in a year (daily). The result is the ANNUAL PERCENTAGE RATE. A change in the index rate generally will result in a change in the ANNUAL PERCENTAGE RATE. The amount that your ANNUAL PERCENTAGE RATE may change also may be affected by the lifetime annual percentage rate limits, discussed below.
Please ask us for the current index value, margin and annual percentage rate. After you open a credit line, rate information will be provided on the periodic statement that we send you.
FREQUENCY OF ANNUAL PERCENTAGE RATE ADJUSTMENTS
Your ANNUAL PERCENTAGE RATE can change on a daily basis. There is no limit on the amount by which the annual percentage rate can change in any one year period. However, under no circumstances will your ANNUAL PERCENTAGE RATE exceed 21.000% per annum or, go below 4.000% per annum at any time during the term of the Plan.
In addition, the margin may be increased in the event you no longer utilize various banking services taken into consideration at the time you applied for the line. Such services include: (a) checking accounts, (b) other deposit accounts and (c) the use of automatic debiting of your accounts for the purpose of making payments due on this line. Upon termination by you of each type of service referred to in (a), (b) and (c), the Margin shall be increased by one-quarter of one percent (.25%). Any increase in Margin will result in an increase in the Annual Percentage Rate.
MAXIMUM RATE AND PAYMENT EXAMPLE
If you had an outstanding balance of $10,000.00, the minimum payment at the maximum ANNUAL PERCENTAGE RATE of 21.000% would be $178.36. This ANNUAL PERCENTAGE RATE could be reached at the time of the 1st payment.
PREPAYMENT
The greater of $300.00 or 0.2% of the commitment amount if you refinance with us, close or terminate your Account for any reason within thirty-six (36) months of the Promissory Note date as an Early Cancellation Fee. You will not be charged an Early Cancellation Fee if the Bank suspends or terminates your Account. You may prepay all or any amount owing under this Account at any time without incurring an Early Cancellation Fee, provided that you do not close or terminate your Account within 36 months of the Promissory Note date. If you open a new credit line account, including refinancing with the Bank of this Account, within thirty (30) days of closing or terminating your Account, the Bank will refund $100.00 of the Early Cancellation Fee.
HISTORICAL EXAMPLE
The example below shows how the ANNUAL PERCENTAGE RATE and the minimum payments for a single $10,000.00 credit advance would have changed based on changes in the Index from 1997 to 2011. The Index values are from the following reference period: The first business day of the month of October for each of the specified years. While only one payment per year is shown, payments may have varied during each year. Different outstanding principal balances could result in different payment amounts.
The table assumes that no additional advances were taken and that only the minimum payment was made. It does not necessarily indicate how the Index or your payments would change in the future.
| INDEX TABLE | ||||
|---|---|---|---|---|
| YEAR (The first business day of the month of October for each of the specified years.) | INDEX (Percent) | MARGIN(1) (Percent) |
ANNUAL PERCENTAGE RATE% | MONTHLY PAYMENT (Dollars) |
| 1997 | 8.500 | -0.500 | 8.000 | 67.95 |
| 1998 | 8.250 | -0.500 | 7.750 | 65.82 |
| 1999 | 8.250 | -0.500 | 7.750 | 65.82 |
| 2000 | 9.500 | -0.500 | 9.000 | 76.44 |
| 2001 | 6.000 | -0.500 | 5.500 | 46.71 |
| 2002 | 4.750 | -0.500 | 4.250 | 36.10 |
| 2003 | 4.000 | -0.500 | 3.500 | 29.73 |
| 2004 | 4.750 | -0.500 | 4.250 | 36.10 |
| 2005 | 6.750 | -0.500 | 6.250 | 53.08 |
| 2006 | 8.250 | -0.500 | 7.750 | 65.82 |
| 2007 | 7.750 | -0.500 | 7.250 | 61.58 |
| 2008 | 5.000 | -0.500 | 4.500 | 38.22 |
| 2009 | 3.250 | +1.000 | 4.250 | 36.10 |
| 2010 | 3.250 | +1.000 | 4.250 | 36.10 |
| 2011 | 3.250 | +1.250 | 4.500 | 38.22 |
| (1) This is a margin we have used recently; your margin may be different | ||||
revised: March, 2012
Equal Housing Lender