Home Equity Line Of Credit Disclosure

This disclosure contains important information about our Home Equity Line of Credit. You should read it carefully and keep a copy for your records. After reading, you may continue to the form by clicking the link at the bottom of the screen.

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 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: Under certain circumstances, we can (1) terminate your line and require you to pay us the entire outstanding balance in one payment; (2) refuse to make additional extensions of credit; and (3) reduce your credit limit.

We can terminate your account and require you to pay us the entire outstanding balance in one payment if: (1) you engage in fraud or material misrepresentation in connection with the plan; (2) you do not meet the repayment terms; 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) you engage in fraud or material misrepresentation in connection with the line; (2) you do not meet the repayment terms; (3) your action or inaction adversely affects the collateral or our rights in the collateral; (4) the value of the dwelling securing the line declines significantly below its appraised value for purposes of the line; (5) we reasonably believe you will not be able to meet the repayment requirements due to a material change in your financial circumstances; (6) you are in default of a material obligation of the agreement; (7) 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 than 120 percent of the credit line; (8) a regulatory agency has notified us that continued advances would constitute an unsafe and unsound business practice; or (9) the maximum annual percentage rate is reached.

Minimum Payment Requirements: You can obtain credit advances for 5 year(s). During this period, payments will be due monthly. Your minimum monthly payment will equal the amount of accrued interest only.

The minimum monthly payments will not reduce the principal that is outstanding on your line by the end of 5 year(s). You will then be required to pay the entire balance in a single payment.

Minimum Payment Example: If you made only the minimum monthly payment and took no other credit advances, it would take 5 year(s) to pay off a credit advance of $10,000 at an ANNUAL PERCENTAGE RATE of 9.5%. During that period, you would make 59 payment(s) of $79.17, with a final payment of $10,079.17.

Fees And Charges: You may pay certain fees to third parties such as appraisers, credit reporting firms, and government agencies. These fees generally total $10 to $1,500. If you ask, we will provide you with an itemization of the fees you will have to pay to third parties. You must carry insurance on the property that secures this plan.

Refundability of Fees: If you decide not to enter into this plan within three days of receiving this disclosure and the Home Equity booklet, you are entitled to a refund of any fee you may have already paid.

Minimum Draw Requirements: Any advance made must be a multiple of $100, subject to a minimum advance of $100.

Tax Deductibility: You should consult a tax advisor regarding the deductibility of interest and charges for the plan.

Variable Rate Features: This plan 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. The annual percentage rate includes only interest and not other costs.

The annual percentage rate is based on the value of an index. The index is the Wells Fargo Bank Minnesota N.A. Prime Rate of interest and is found by calling First Security bank at 507-775-2316. To determine the annual percentage rate that will apply to your account, we add a margin to the value of the index.

Ask us for the current index value, margin, and annual percentage rate. After you open a credit line, rate information will be provided on periodic statements that we send you.

Rate Changes. The annual percentage rate can change monthly. There is no limit on the amount by which the rate can change in any one year period. The maximum ANNUAL PERCENTAGE RATE that can apply during the plan is 18%.

Maximum Rate And Payment Examples: If you had an outstanding balance of $10,000, the minimum monthly payment at the maximum ANNUAL PERCENTAGE RATE of 18% would be $158.33. The maximum annual percentage rate could be reached in the first month following an initial hold of one month.

Historical Examples: 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 last 15 years. The index values are from the first business day of August. The table assumes that no additional credit advances were taken, that only the minimum payment was made, and that the rate remained constant during each year. It does not necessarily indicate how the index or your payments would change in the future.

Year Index
2009 3.250 0.000 3.250 27.08
2010 3.250 0.000 3.250 N/A
2011 3.250 0.000 3.250 N/A
2012 3.250 0.000 3.250 N/A
2013 3.250 0.000 3.250 N/A
2014 3.250 0.000 3.250 N/A
2015 3.250 0.000 3.250 N/A
2016 3.500 0.000 3.500 N/A
2017 4.250 0.000 4.250 N/A
2018 5.000 0.000 5.000 N/A
2019 5.250 0.000 5.250 N/A
2020 3.250 0.000 3.250 N/A
2021 3.250 0.000 3.250 N/A
2022 5.500 0.000 5.500 N/A
2023 8.500 0.000 8.500 N/A
(*) The actual index % and APR were less than the floor interest rate


Please review the Consumer Financial Protection Bureau Publication
"What You Should Know About Home Equity Lines Of Credit"



In connection with your application for a home loan, the lender must disclose to you that score that a consumer-reporting agency distributed to users and the lender used in connection with your home, and the key factors affecting your credit scores.

The credit score is a computer-generated summary calculated at the time of the request and based on information that a consumer reporting agency or lender has on file. The scores are based on data about your credit history and payment patterns. Credit scores are important because they are used to assist the lender in determining whether you will obtain a loan. They may also be used to determine what interest rate you may be offered on the mortgage. Credit scores can change over time, depending on your conduct, how your credit history and payment patterns change, and how credit-scoring technologies change.

Because the sore is based on information in your credit history, it is very important that you review the credit-related information that is being furnished to make sure it is accurate. Credit records may vary from one company to another.

If you have questions about your credit score or the credit information that is furnished to you, contact the consumer reporting agency at the address and telephone number provided with this notice or contact the lender, if the lender developed or generated the credit score. The consumer reporting agency plays no part in the decision to take any action on the loan application and is unable to provide you with specific reasons for the decision on a loan application.

Equifax 800-685-111
P.O. Box 740256
Atlanta, GA 30374

We may order an appraisal to determine the property's value and charge you for this appraisal. We will promptly give you a copy of any appraisal, even if your loan does not close. You can pay for an additional appraisal for your own use at your own cost.