Home equity line of credit disclosure

Helpful information and legal disclosures regarding a home equity line of credit.

IMPORTANT TERMS OF HOME EQUITY LINE OF CREDIT ACCOUNT

In this disclosure, the words "you" and "your" mean each person who signs the last page of this disclosure, and the words "we," "us," "our" and the “Bank” mean Ameriprise Bank, FSB.

This disclosure contains important information about our Home Equity Line of Credit Account (the "Account"). You should read it carefully and keep this copy for your records. PLEASE SIGN THE LAST PAGE OF THIS DISCLOSURE AND RETURN IT TO THE BANK AS ACKNOWLEDGMENT OF YOUR RECEIPT OF THIS DISCLOSURE.

1. Availability of Terms
(a) Terms May Change. All of the terms described below are subject to change.
(b) Refund of Fees. If these terms change (other than the variable 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 have paid to us or anyone else in connection with your application.
2. 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.
3. Possible Actions
(a) We Can Terminate Your Account. We can terminate your Account and require you to pay us the entire outstanding balance in one payment, and charge you certain fees if:

(b) We Can Freeze Your Account or Reduce Your Credit Limit. We can refuse to make additional extensions of credit or reduce your credit limit if:

(c) We Can Change Your Account. The initial agreement permits us to make certain changes to the terms of the Account at specified times or upon the occurrence of specified events.

4. Minimum Payment Requirements
(a) Draw Period. Except as described above, you can get loan advances under your Account for 5 or 10 years, depending on your product selection. The period during which you may get loan advances is called the "Draw Period." During the Draw Period, payments will be due monthly.

We may, in our sole discretion, renew your right to get loans under your Account at the end of the Draw Period for an additional 5-year period (the “Renewal Draw Period”). We will give you written notice if we decide not to renew your Draw Period for an additional 5 years. We will not give you more than one Renewal Draw Period.

(b) Draw Period Payment. Your minimum monthly payment during the Draw Period (including any Renewal Draw Period) will equal the greater of all finance charges that have accrued during the prior billing cycle or $50.00, plus any other charges, any credit insurance premiums, and any amounts which are past due or in excess of your credit limit. In addition, balances of less than $50.00 (or $25.00, depending on your product selection) must be paid in full. The minimum monthly payment will not reduce the outstanding principal balance on your Account by the end of the Draw Period (including any Renewal Draw Period).

(c) Repayment Period. After the Draw Period ends, you will no longer be able to get loan advances, and you must pay us all amounts you owe under your Account over a period of 180 months. This 180-month period is called the "Repayment Period."

(d) Payments During the Repayment Period. During the Repayment Period, your minimum monthly payment will be an amount equal to the greater of (i) the sum of (a) the unpaid principal balance divided by the remaining number of scheduled payments in the Repayment Period, plus (b) all finance charges that have accrued during the prior billing cycle, plus (c) any other charges assessed to your Account, any credit insurance premiums, and any amounts which are past due or in excess of your credit limit, or (ii) $50.00. In addition, balances of less than $50.00 must be paid in full.

5. Minimum Payment Example
If you took a single $10,000 advance and the ANNUAL PERCENTAGE RATE was 6.75%, it would take 240 months to pay off the advance if you made only the minimum payments. During that time, you would make 60 monthly payments during the Draw Period of $56.25, followed by 179 monthly payments during the Repayment Period ranging from 88.49 to $52.05, followed by a final payment of $88.28.

6. Fees and Charges
(a) Fees Paid to Us. To open and maintain a line of credit, you must pay the following fees:

Fee	Amount	When You Must Pay Fee
Application Fee		At application
Origination Fee		When account opened
Broker Fee (if any)		When account opened
Flood Cert. Fee	$15.50	When account opened
Registration Fee to M.E.R.S	$3.95	When account opened
Annual Fee	$50	Annually, beginning on 1st anniversary of Account opening

(b) Fees Paid to Third Parties. You may also be required to pay certain fees to third parties, such as appraisers, credit reporting firms, title insurance companies, flood certification companies, overnight couriers, closing agents, attorneys, and recording and government agencies for state taxes and recording fees in order to open an Account. These fees generally range from $50.00 and $2,500.00. If you ask, we will provide you an itemization of the fees you will have to pay third parties. If you engage a broker to arrange a line of credit for you, you may be charged fees by the broker for his/her services.

(c) Property Insurance. You must carry hazard insurance (including flood insurance, if required) on the property that secures your Account.

7. Minimum Draw and Credit Line Requirements
(a) Minimum Draw. The minimum credit advance that you can receive is $100.00 (or $250, depending on your product selection).
(b) Minimum Credit Line. The minimum credit line that you can receive is $10,000 (or $15,000, depending on your product selection).

8. Tax Deductibility
You should consult a tax advisor regarding the deductibility of interest and charges under the Account.

9. Variable Rate Feature
Your Account 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. (See Section 11 below) The Annual Percentage Rate includes only interest and not other costs.
(a) Variable Rate Index. The Annual Percentage Rate is based on the value of an index (the "Index"). The Index is the highest domestic "Prime Rate" listed in the "Money Rates" section of The Wall Street Journal (eastern edition) as of the first business day of the calendar month in which the billing cycle begins.
(b) How We Figure Your APR. We figure the variable Annual Percentage Rate by adding a "margin" to the value of the Index.
(c) Ask Us For Current Information. Ask us for the current Index values, margins and Annual Percentage Rates.
(d) Information On Periodic Statements. After you open an Account, rate information will be provided on periodic statements that we send you.

10. Rate Changes
You may be entitled to receive a “Preferred Rate” under your Account. The Preferred Rate is a reduction of your ANNUAL PERCENTAGE RATE by 0.25%. You will be eligible for the Preferred Rate if you are an Ameriprise Platinum Advantage client of Ameriprise Financial, Inc. If you cease to be an Ameriprise Platinum Advantage client of Ameriprise Financial, Inc. for any reason, your Preferred Rate will be eliminated and your ANNUAL PERCENTAGE RATE will increase by 0.25%.

11. Maximum Rate And Payment Examples
Your ANNUAL PERCENTAGE RATE can change on the first day of each monthly billing cycle, based on the value of the Index published on the first business day of the calendar month in which the billing cycle begins.

The maximum ANNUAL PERCENTAGE RATE that can apply to your Account is 16.00% (the "Rate Cap"). There is no minimum ANNUAL PERCENTAGE RATE that can apply to your Account. Apart from the Rate Cap, there is no limit on the amount by which the rate can change during any one-year period or over the life of your Account.

The ANNUAL PERCENTAGE RATE will change without prior notice to you. Your new ANNUAL PERCENTAGE RATE will apply to your then existing unpaid principal balance and all new loans that you obtain under your Account until the Index changes again. Your daily periodic rate at any time will equal your ANNUAL PERCENTAGE RATE divided by 365.

12. Maximum Rate And Payment Examples
(a) Draw Period. If, at the beginning of the Draw Period, the ANNUAL PERCENTAGE RATE equaled the 16.00% maximum (the Rate Cap) and you had an outstanding balance of $10,000, the minimum monthly payment would be $133.33.
The maximum Annual Percentage Rate (the Rate Cap) could be reached during the first month of the Draw Period.
(b) Repayment Period. If, at the beginning of the Repayment Period, the ANNUAL PERCENTAGE RATE equaled the 16.00% maximum (the Rate Cap) and you had an outstanding balance of $10,000, the minimum monthly payment would be $139.13. The maximum Annual Percentage Rate (the Rate Cap) could be reached during the first month of the Repayment Period.

13. Historical Examples
The following table shows how the Annual Percentage Rate and the minimum monthly 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 business day of January of each year. While only one payment amount per year is shown, payments would have varied during each year.

The table assumes a 5-year Draw Period (with no Renewal Draw Period). The table also assumes that no additional credit advances were taken, that only the minimum payments were made each month, and that the rate remained constant each year. The table does not necessarily indicate how the Index or your payments would change in the future.

	Year	Index (%)	Margin (%)	APR (%)	Min. Monthly Payment (%)
Draw Period	1992	10.50%	.50%	11.00%	$91.67
	1993	9.50%	.50%	10.00%	$83.33
	1994	6.50%	.50%	7.00%	$58.33
	1995	6.00%	.50%	6.50%	$54.17
	1996	8.50%	.50%	9.00%	$75.00
	1997	8.75%	.50%	9.25%	$77.08
	1998	8.25%	.50%	8.75%	$72.92
	1999	8.50%	.50%	9.00%	$75.00
	2000	7.75%	.50%	8.25%	$68.75
	2001	8.50%	.50%	9.00%	$75.00
Repayment Period	2002	9.50%	.50%	10.00%	$83.33
	2003	4.75%	.50%	5.25%	$43.75
	2004	4.25%	.50%	4.75%	$39.58
	2005	6.00%	.50%	6.50%	$54.17
	2006	6.25%	.50%	6.75%	$56.25

¹Index values as of the first business day in January.
²This is a margin we have used recently. Your margin may be different.

For additional information, click below to download a helpful document from the U.S Department of Housing and Urban Development.
When Your Home Is on the Line: What You Should Know about Home Equity Lines of Credit (PDF)
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