The dollar amount you pay for money borrowed is called a finance charge. The finance charge begins on the date of each advance.
This plan has a variable-rate feature, and the annual percentage rate (corresponding to the periodic rate) and minimum payment can 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 Prime Interest Rate.
The index is published in the money rates section of the Wall Street Journal. The annual percentage rate is the index.
The annual percentage rate can change monthly on the first day of the month following change in the index value. The maximum ANNUAL PERCENTAGE RATE that can apply is 18.00%. Under no circumstances will your ANNUAL PERCENTAGE RATE go below 3.00% during the term of the Plan.
You must pay certain fees to third parties to open the Plan. These fees generally total between $0 and $500.00. You must also carry insurance on the property that secures this Plan. If the property is located in a Special Flood Hazard area, you will be required to obtain flood insurance.
If your payment is 15 or more days past due, you will be charged $15.00.
We figure the finance charge on your account by applying the periodic rate to the “daily balance” of your account for each day in the billing cycle. To get the “daily balance” we take the beginning balance of your account each day, add any new advances, and subtract any unpaid finance charges and any payments or credits. This gives us the daily balance.
We can terminate your line, require you to pay us the entire outstanding balance in one payment if: You engage in fraud or material misrepresentation in connection with the line. You do not meet the repayment terms. 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: the value of the dwelling securing the line declines significantly below its appraised value for purposes of the line. We reasonably believe you will not be able to meet the repayment due to a material change in your financial circumstances. You are in default of a material obligation in the agreement. Government action prevents us from imposing the annual percentage rate provided for or impairs our security interest such that the value of the interest is less the 120 percent of the credit line. A regulatory agency has notified us that continued advances would constitute an unsafe and unsound practice. A maximum annual percentage rate is reached.
You can obtain credit advances for ten (10) 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 and you will no longer be able to obtain advances. The length of the repayment period is determined by the amount of your outstanding balance after your last advance. The payoff period will always be shorter of the payoff period for your outstanding balance or the time remaining to the maturity date. Periodically, we will review the effect interest rate increases have had on your account. If the annual percentage rate has increased so much that your payment is no longer sufficient to repay the balance within the payoff period payment plus any past due amount plus any amount in excess of your credit limit and all other charges. You agree to always pay the minimum amount due on or before the due date.
The minimum amount of the first credit advance and all advances thereafter is $250.00.
You should consult a tax advisor regarding the deductibility of interest and charges for the line.
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.
YOUR BILLING RIGHTS: KEEP THIS NOTICE FOR FUTURE USE
This notice contains important information about your rights and our responsibilities under the Fair Credit Billing Act.
NOTIFY US IN CASE OF ERRORS OR QUESTIONS ABOUT YOUR BILL.
If you think your statement is wrong, or if you need more information about a transaction on your bill, write us [on a separate sheet] at [the address listed on your bill]. Write to us as soon as possible. We must hear from you no later than 60 days after we sent you the first bill on which the error or problem appeared. You can telephone us, but doing so will not preserve your rights. In your letter, give us the following information:
Your name and account number. The dollar amount of the suspected error. Describe the error and explain, if you can, why you believe there is an error. If you need more information, describe the item you are not sure about.
YOUR RIGHTS AND OUR RESPONSIBILITIES AFTER WE RECEIVE YOUR WRITTEN NOTICE
We must acknowledge your letter within 30 days, unless we have corrected the error by then. Within 90 days, we must either correct the error or explain why we believe the bill was correct. After we receive your letter, we cannot try to collect any amount you question, or report you as delinquent. We can continue to bill you for the amount you question, including finance charges, and we can apply any unpaid amount against your credit limit. You do not have to pay any questioned amount while we are investigating, but you are still obligated to pay the parts of your bill that are not in question. If we find that we made a mistake on your bill, you will not have to pay any finance charges related to any questioned amount. If we didn't make a mistake, you may have to pay finance charges, and you will have to make up any missed payments on the questioned amount. In either case, we will send you a statement of the amount you owe and the date that it is due. If you fail to pay the amount that we think you owe, we may report you as delinquent. However, if our explanation does not satisfy you and you write to us within ten days telling us that you still refuse to pay, we must tell anyone we report you to that you have a question about your bill. And, we must tell you the name of anyone we reported you to. We must tell anyone we report you to that the matter has been settled between us when it finally is. If we don't follow these rules, we can't collect the first $50 of the questioned amount, even if your bill was correct.