Important Terms of Our
FlexEquity Line

Minimum Credit Line is $10,000

This disclosure contains important information about our FlexEquity Line. You should read it carefully and keep a copy for your records. If you ask, we will provide you with information on our other available home equity lines.

1. Availability of Terms. All terms are subject to change before the opening of an account and are not guaranteed. 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 have paid to us or anyone else in connection with your application.

2. Security Interest. We will take a deed of trust on your owner-occupied home. You could lose your home if you do not meet the obligations in your agreement with us.

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

If you ask, we will give you more specific information concerning when we take these actions.

4. Minimum Payment Requirements. You can obtain advances of credit during the first ten (10) years (the draw period). During the draw period you will be required to pay interest only; however, principal payments in any amount can be made at any time. Your required minimum monthly payment during the draw period will be the monthly interest accrued on the outstanding balance as of the last calendar day of the previous month. USU Charter Federal Credit Union (Credit Union) may, at its option, renew or extend the draw period. After the draw period ends, you will no longer be able to obtain credit advances and must repay the outstanding balance (the repayment period). During the repayment period, your required minimum monthly payment will be 1.50 percent of the outstanding balance on the last day of each month but not less than $100 (or the outstanding balance if less than $100 plus the finance charges that have accrued on the outstanding balance). The length of the repayment period will depend on the ANNUAL PERCENTAGE RATE and the balance outstanding at the beginning of it. This loan line does not allow for negative amortization. If the minimum payment amount does not pay the monthly accrued interest, your minimum payment amount will be increased in .25 percent increments to cover accrued interest. Examples: (1.) If the interest rate for a quarter is 17.661 percent or lower your minimum monthly payment will be 1.50 percent of the outstanding balance on the last day of each month, but not less than $100. (2.) If the interest rate for a quarter is between 17.662 percent and 18.00 percent your minimum monthly payment will be 1.75 percent of the outstanding balance on the last day of each month, but not less than $100. It is possible to pay only the minimum monthly payment and not repay any or all of the principal balance. All minimum monthly payments during the draw and repayment periods are due on or before the 15th day of each month.

5. Minimum Payment Example. If you made only the minimum monthly payments and took no other credit advances it would take 21.42 years (257 months) to pay off a credit advance of $10,000 at an ANNUAL PERCENTAGE RATE of 8.00 percent. During that period, you would make 256 monthly payments varying between $150 and $66.67 followed by 1 final payment of $91.28. If you only made the minimum payment (interest only) and took no other credit advances, you would have a remaining balance of $10,000 after paying for 10 years on an advance of $10,000.

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

• Conditionally refundable good faith deposit of $200. (See Conditionally Refundable Good Faith Deposit acknowledgment for conditions when this deposit would not be refundable.)
• Maintain a minimum share balance of $25 in a share account with us.
• A $50 fee is assessed if the credit line is not used at least once during the calendar year.
• One free box of checks is provided when the account is opened. You pay for any additional supplies of checks needed.
• You must carry property insurance on the property that secures this agreement. If applicable, you must also carry flood insurance on the property.

We reserve the right to charge fees for late payments, returned checks and stop payments.

A $500 origination fee applies to this account. However, the Credit Union will delay collection of the origination fee until the earlier of your closing of the account or the third (3rd) anniversary date after your home equity credit line account is opened and will waive the origination fee if the account remains open on that date.

7. Minimum Draw, Balance and Access Requirements. There is no minimum credit advance requirement. You can access your line of credit through the use of checks provided by the Credit Union at its discretion, by Telephone Teller, by Web Teller, by telephone pre-arrangements, or by requesting an advance at a Credit Union office, during the first ten years only, the A "draw period". A $50 fee is assessed if the credit line is not used at least once during the calendar year.

8. Five-Year Fixed Interest Rate Option. You may request a fixed interest rate for the first five years of your loan term. If you choose this option, the fixed interest rate will be 200 basis points (2.00 percent) above the rate that you will receive at the time your line of credit is opened.

9. Discounted Rate. If you are applying for a new line of credit (not a refinance of an existing home equity line of credit loan at the Credit Union) and you have not elected the five-year fixed rate option, you may be eligible for a discounted rate of 0.00 percent for the first three months of your loan.

10. Tax Deductibility. You should consult a tax advisor regarding the deductibility of interest and charges for the line of credit.

11. Variable Rate Information. The line has a variable rate feature; consequently, the ANNUAL PERCENTAGE RATE (corresponding to the periodic rate) as well as the minimum payment and the number of months you are making payments 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 lowest Prime Rate charged by banks as published in the Wall Street Journal "Money Rates" table on the last day of each quarter (March 31, June 30, September 30 and December 31). To determine the ANNUAL PERCENTAGE RATE that will apply to your line, which may vary each quarter, we add a margin to the value of the index.

12. Rate Changes. The maximum ANNUAL PERCENTAGE RATE that can apply is 18 percent. The minimum rate that can apply is 3 percent. The annual percentage rate can change quarterly. Except for the 18 percent "cap" and the 3 percent "floor", there is no limit on the amount by which the rate can change during any one-quarter period.

13. 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 percent would be $175. This annual percentage rate could be reached during the first month.

14. Historical Examples. The following tables show 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 June 30 of each year. While only one payment amount per year is shown, payments would have varied during each year. The tables 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. They do not necessarily indicate how the index or your payments will change in the future.

Variable Rate Example

Year	Index	Margin*		ANNUAL PERCENTAGE RATE	Minimum Monthly Payment
	(%)	(%)		(%)	($)
1992	6.50	-.25	Draw Period	0.00**	52.08***
1993	6.00	-.25		5.75	47.92
1994	7.25	-.25		7.00	58.33
1995	9.00	-.25		8.75	72.92
1996	8.25	-.25		8.00	66.67
1997	8.50	-.25		8.25	68.75
1998	8.50	-.25		8.25	68.75
1999	7.75	-.25		7.50	62.50
2000	9.50	-.25		9.25	77.08
2001	6.75	-.25		6.50	54.17
2002	4.75	-.25	Repayment Period	4.50	150.00
2003	4.00	-.25		3.75	130.96
2004	4.00	-.25		3.75	113.47
2005	6.00	-.25		5.75	100.00****
2006	8.25	-.25		8.00	100.00****

*	This is a margin we have used recently; your margin may be different.
**	This rate reflects a “discount” rate we have used recently. This rate applies to new credit lines and is in effect for the first three months of the credit line.
***	This interest only payment reflects the minimum payment after the “discount” rate for the first three months based on a 6.25% ANNUAL PERCENTAGE RATE. The minimum payment while the “discount” rate was in effect for the first three months of the credit line would have been $0.
****	This payment reflects that payments cannot be less than $100.00 per month.

Five-Year Fixed Rate Example

Year	Index	Margin*		ANNUAL PERCENTAGE RATE	Minimum Monthly Payment
	(%)	(%)		(%)	($)
1992	6.50	-.25	Draw Period	10.00**	83.33
1993	6.00	-.25		10.00**	83.33
1994	7.25	-.25		10.00**	83.33
1995	9.00	-.25		10.00**	83.33
1996	8.25	-.25		10.00**	83.33
1997	8.50	-.25		8.25	68.75
1998	8.50	-.25		8.25	68.75
1999	7.75	-.25		7.50	62.50
2000	9.50	-.25		9.25	77.08
2001	6.75	-.25		6.50	54.17
2002	4.75	-.25	Repayment Period	4.50	150.00
2003	4.00	-.25		3.75	130.96
2004	4.00	-.25		3.75	113.47
2005	6.00	-.25		5.75	100.00***
2006	8.25	-.25		8.00	100.00***

*	This is a margin we have used recently; your margin may be different.
**	This rate reflects a fixed-rate option we have used recently for the first five years of the credit line.
***	This payment reflects that payments cannot be less than $100.00 per month.

Other rates and margins may apply depending upon your loan-to-value ratio. 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 will send you.

Important Information About Procedures for Opening a New Account: To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account.

What this means for you: When you open an account, we will ask for your name, address, date of birth and other information that will allow us to identify you. We may also ask to see your driver’s license or other identifying documents.