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Important Terms of Our Fixed Rate Draw Period Home Equity Line of

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					                                          P.O. Box 1009
                                    Burlington, VT 05402-1009



                                 Important Terms of Our
                    Fixed Rate Draw Period Home Equity Line of Credit
                     With Variable Rate Ten Year Amortization Option


This disclosure contains important information about our Fixed Rate Draw Period Home
Equity Line Of Credit with a Variable Rate Ten Year Amortization Option (the Plan). You
should read it carefully and keep a copy for your records.

AVAILABILITY OF TERMS. All of the terms described below are subject to change. If any of
these terms change 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.

       Termination and Acceleration. We can terminate the Plan and require you to pay us
       the entire outstanding balance in one payment, and charge you certain fees, if any of the
       following happen:

       a. You commit fraud or make a material misrepresentation at any time in connection
          with the Plan. This can include, for example, a false statement about your income,
          assets, liabilities, or any other aspect of your financial condition.

       b. You do not meet the repayment terms of the Plan.

       c. Your action or inaction adversely affects the collateral for the Plan or our rights in the
          collateral. This can include, for example, failure to maintain required insurance,
          waste or destructive use of the dwelling, failure to pay taxes, death of all persons
          liable on the account, transfer of title or sale of the dwelling, creation of a senior lien
          on the dwelling without our permission, foreclosure by the holder of another lien or
          use of funds or the dwelling for prohibited purposes.

       Suspension or Reduction. In addition to any other rights we may have, we can
       suspend additional extensions of credit or reduce your credit limit during any period in
       which any of the following are in effect:

       a. The value of your dwelling declines significantly below the dwelling’s appraised value
          for purposes of the Plan. This includes, for example, a decline such that the initial
          difference between the credit limit and the available equity is reduced by fifty percent
          and may include a smaller decline depending on the individual circumstances.

       b. We reasonably believe that you will be unable to fulfill your payment obligations
          under the Plan due to a material change in your financial circumstances.

       c. You are in default under any material obligation of the Plan. We consider all of your
          obligations to be material. Categories of material obligations include, but are not
          limited to, the events described above under Termination and Acceleration,
          obligations to pay fees and charges, obligations and limitations on the receipt of
          credit advances, obligations concerning maintenance or use of the dwelling or
          proceeds, obligations to pay and perform the terms of any other deed of trust,
          mortgage or lease of the dwelling, obligations to notify us and to provide documents
          or information to us (such as updated financial information), obligations to comply
          with applicable laws (such as zoning restrictions), and obligations of any guarantor or
          comaker. No default will occur until we mail or deliver a notice of default to you, so
          you can restore your right to credit advances.

       d. We are precluded by government action from imposing the annual percentage rate
          provided for under the Plan.



Fixed-Rate Draw Period Home Equity Line of Credit - Revised 6/1/11                 Page 1 of 6
       e. The priority of our security interest is adversely affected by government action to the
          extent that the value of the security interest is less than 120 percent of the credit
          limit.

       f.   We have been notified by governmental authority that continued advances may
            constitute an unsafe and unsound business practice.

       g. The maximum annual percentage rate under the Plan is reached.

       Change in Terms. We may make changes to the terms of the Plan if you agree to them
       in writing at that time, if the change will unequivocally benefit you throughout the
       remainder of the Plan, or if the change is insignificant (such as changes relating to our
       data processing systems).

FEES AND CHARGES. In order to open and maintain an account, you must pay certain fees
and charges.

       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 $115.00 and $1,675.00. Upon request, we will provide you with an itemization
       of the fees you will have to pay to third parties. Lender may, at its option, provide a credit
       towards some or all of these fees during a marketing campaign.

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: 60 months (the “Draw Period”). During the Draw Period your Regular Payment
will equal the amount of your accrued finance charges. You will make 59 of these payments.
Unless you select the Ten Year Amortization Option described below, you will then be required
to pay the entire balance owing in a single balloon payment. If you make only the minimum
payments during the draw period, you will not repay any of the principal balance by the end of
the Plan. Your payments will be due monthly. Your “Minimum Payment” will be your Regular
Payment, plus any amount past due and all other charges. The Minimum Payment will not fully
repay the principal that is outstanding on your Credit Line and your final payment will be a single
balloon payment.

       Ten Year Amortization Option. If you select this option, at any point up to the end of
       your draw period, the length of your Repayment Period will be 120 months. You will not
       be able to obtain credit advances during this Repayment Period. Your payments will be
       due monthly during the Repayment Period. Your Minimum Monthly Payment will be 120
       equal principal payments plus accrued interest. The Ten Year Amortization Option has a
       Variable Rate Feature. The Annual Percentage Rate may increase during the
       Repayment Period if the rate increases on the Prime Rate as published in the Money
       Rates Section of the Wall Street Journal. The Interest Rate will not go below 3.250% or
       increase above 18.000%. The rate will not increase more often than once every month
       on the first day of each month. Any increase in the rate will take the form of larger
       accrued interest payments.

       To select this Ten Year Amortization Option you must satisfy the following
       condition:

       a. You must execute a Change In Terms Agreement before the end of your Draw
          Period.

MINIMUM PAYMENT EXAMPLES.

       Draw Period. If you made only the minimum payment and took no other credit
       advances, it would take 60 months to pay off a credit advance of $10,000.00 at an
       ANNUAL PERCENTAGE RATE of 5.75%. During that period, you would make 59
       monthly payments of $48.84 and one final payment of $10,048.84.

       Ten Year Amortization Option. If you select the Ten Year Amortization Option and
       made only the minimum payment during the Draw Period and took no other credit
       advances, it would take 180 months to payoff a credit advance of $10,000.00, 60
       monthly payments of $48.84 at an ANNUAL PERCENTAGE RATE of 5.750% during the
       Draw Period, 119 monthly principal plus accrued interest payments ranging from $83.79
       to $110.93 and one final principal and interest payment of $83.56 at the initial ANNUAL
       PERCENTAGE RATE of 3.250% during the Ten Year Amortization Repayment Period.

Fixed-Rate Draw Period Home Equity Line of Credit - Revised 6/1/11                 Page 2 of 6
TRANSACTION REQUIREMENTS. The following transaction limitations will apply to accessing
your Credit Line by writing a HomeLine Check, requesting an advance in person or requesting
an advance by mail.

       Minimum Advance Amount. The minimum amount of any credit advance that can be
       made on your Credit Line is as follows: $500.00. This means any HomeLine Check
       must be written for at least the minimum advance amount.

TAX DEDUCTIBILITY. You should consult a tax advisor regarding the deductibility of interest
and charges for the Plan.

ADDITIONAL HOME EQUITY PROGRAMS. Please ask us about our other available Home
Equity Line of Credit plans.

ANNUAL PERCENTAGE RATE INFORMATION.

       The annual percentage rate under the Plan Draw Period is not based on an Index.
       It is based upon a fixed rate, which will be specified either at the time you receive a loan
       commitment or at the loan closing, and will be based upon the market conditions at that
       time. An ANNUAL PERCENTAGE RATE of 5.750% percentage points is representative
       of a fixed rate recently offered by us under the Plan. The annual percentage rate does
       not include costs other than interest. Please ask us for the current annual percentage
       rate under the Plan.

VARIABLE RATE FEATURE.

       The Ten Year Amortization Option Repayment Period has a variable rate feature.
       The annual percentage rate (corresponding with 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.
               Information about the Index is available or published daily in the Wall Street
               Journal’s Money Rates Section. We will use the most recent Index value
               available to us as of 14 days prior to the payment due date for 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 annual percentage rate that will
               apply to your account, we add a margin to the value of the Index. An ANNUAL
               PERCENTAGE RATE of 3.250% is representative of the recent Prime Rate
               published in the Money Rates Section of the Wall Street Journal and subject to
               the interest rate floor as discussed below. 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 as 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 periodic
               statements that we send you.

       FREQUENCY OF ANNUAL PERCENTAGE RATE ADJUSTMENTS. Your annual
       percentage rate can change on the first day of each month. There is no limit on the
       amount by which the annual percentage rate can change during any one year period.
       However, under no circumstances will your ANNUAL PERCENTAGE RATE go below
       3.250% or exceed 18.000% per annum at any time during the term of the Ten Year
       Amortization Option Repayment Period.

       MAXIMUM PAYMENT AND RATE EXAMPLE. If you had an outstanding balance of
       $10,000.00 at the beginning of the Ten Year Amortization Option Repayment Period, the
       minimum monthly principal plus accrued interest payment at the maximum ANNUAL
       PERCENTAGE RATE of 18.000% would be $236.21. This annual percentage rate
       could be reached at the time of the 1st month of the repayment period.

Fixed-Rate Draw Period Home Equity Line of Credit - Revised 6/1/11                  Page 3 of 6
PREPAYMENT. You may prepay all or any amount owing under the Plan Draw Period or the
Ten Year Amortizing Option Repayment Period, at any time without penalty.

HISTORICAL EXAMPLE. The following Index Table shows how the annual percentage rate
and the minimum payments for a single $10,000.00 credit advance would have changed during
a 60 month period, based on changes in the Index from 1996 to 2010. The Index values are as
of the last business day in July. 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 credit advances were taken and that only the minimum
payment was made. It does not necessarily indicate how the Index or your payments during the
Draw Period of the Plan would change in the future.

                                           INDEX TABLE

                                       Index       Margin (1)      ANNUAL             Monthly
Year (rates as of the last           (Percent)     (Percent)     PERCENTAGE           Payment
business day in July)                                               RATE              (Dollars)

1996……………………………...                      8.250         0.00           5.750 (2)          48.84

1997……………………………...                      8.500         0.00           5.750 (2)          48.84

1998……………………………...                     8.500          0.00           5.750 (2)          48.84

1999……………………………...                     8.000          0.00           5.750 (2)          48.84

2000……………………………...                      9.500         0.00           5.750 (2)          48.84

2001……………………………...                     6.750          0.00            6.750

2002……………………………...                     4.750          0.00            4.750

2003……………………………...                     4.000          0.00            4.000

2004……………………………...                     4.250          0.00            4.250

2005……………………………...                     6.250          0.00            6.250

2006……………………………...                     8.250         0.000            8.250

2007……………………………..                      8.250         0.000            8.250

2008……………………………..                      5.000         0.000            5.000

2009……………………………..                      3.250         0.000            3.250

2010……………………………..                      3.250         0.000            3.250


(1) This is a margin we have recently used for our Home Equity Line of Credit Plan; your margin may be
    different.
(2) This rate is representative of a Fixed Rate we have used recently; your fixed rate may be different.

It is the policy of The Merchants Bank to provide all Home Equity Line of Credit
applicants with the handbook entitled: “When Your Home Is On The Line: What You
Should Know About Home Equity Lines of Credit” in addition to this disclosure.




Fixed Rate Draw Period Home Equity Line of Credit with a Ten Year Amortization Option.



Fixed-Rate Draw Period Home Equity Line of Credit - Revised 6/1/11                   Page 4 of 6
                    WHAT DOES MERCHANTS BANK & MERCHANTS TRUST COMPANY
FACTS               DO WITH YOUR PERSONAL INFORMATION?

Why?                Financial companies choose how they share your personal information. Federal law gives
                    consumers the right to limit some but not all sharing. Federal law also requires us to tell you how
                    we collect, share, and protect your personal information. Please read this notice carefully to
                    understand what we do.
What?               The types of personal information we collect and share depend on the product or service you
                    have with us. This information can include:
                       Social Security number and credit history
                    When you are no longer our customer, we continue to share your information as described in this
                    notice.
How?                All financial companies need to share non public personal information to run their everyday
                    business. In the section below, we list the reasons financial companies can share their non public
                    personal information; the reasons Merchants Bank & Merchants Trust Company choose to
                    share; and whether you can limit this sharing.

Reasons we can share your personal information              Does Merchants Bank          Can you limit this sharing?
                                                                  share?
For our everyday business purposes –
                                                                      Yes                              No
Such as to process your transaction, maintain your
account(s), respond to court orders and legal
investigations, or report to credit bureaus

For our marketing purposes –
                                                                      Yes                              No
To offer our products and services to you

For joint marketing with other financial companies                    Yes                              No

For our affiliates’ everyday business purposes –
                                                                      N/A                             N/A
Information about your transactions and experiences

For our affiliates’ everyday business purposes –
                                                                      N/A                             N/A
Information about your creditworthiness

For nonaffiliates to market to you                                     No                              No


Questions?          Call 800-322-5222 or go to www.mbvt.com

Who we are
Who is providing this notice?               Merchants Bank and Merchants Trust Company
What we do
How does Merchants Bank &                   To protect your personal information from unauthorized access and use,
Merchants Trust Company protect             we use security measures that comply with federal law. These measures
my personal information?                    include computer safeguards and secured files and buildings.

How does Merchants Bank &                   We collect your personal information, for example, when you
Merchants Trust Company collect my           open a deposit account or
personal information?                        apply for a loan, or
                                             open a trust relationship
                                            We also collect your personal information from others, such as credit
                                            bureaus or when verifying information you provide to us.

Why can’t I limit all sharing?              Federal law gives you the right to limit only
                                             sharing for affiliates’ everyday business purposes – information about
                                                your creditworthiness
                                             affiliates from using your information to market to you
                                             sharing for nonaffiliates to market to you
                                            State laws and individual companies may give you additional rights to limit
                                            sharing.
Definitions
Affiliates                                  Companies related by common ownership or control. They can be
                                            financial and nonfinancial companies.
                                             None




         Fixed-Rate Draw Period Home Equity Line of Credit - Revised 6/1/11                       Page 5 of 6
Nonaffiliates                             Companies not related by common ownership or control. They can be
                                          financial and nonfinancial companies.
                                           None

Joint marketing                           A formal agreement between nonaffiliated financial companies that
                                          together market financial products or services to you.
                                           FirstBankcard

Other important information

                                     CREDIT BUREAU REPORTING NOTICE
We may report information about your account to credit bureaus. Late payments, missed payments, or other defaults
on your account may be reflected in your credit report.
                          CUSTOMER IDENTIFICATION PROGRAM NOTICE
            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.




        Fixed-Rate Draw Period Home Equity Line of Credit - Revised 6/1/11                     Page 6 of 6
                                                 P.O. Box 1009
                                           Burlington, VT 05402-1009



                                   Important Terms of Our
                    Variable Rate Draw Period Home Equity Line of Credit
                     With a Variable Rate Ten Year Amortization Option


This disclosure contains important information about our Variable Rate Draw Period
Home Equity Line Of Credit with a Variable Rate Ten Year Amortization Option (the Plan).
You should read it carefully and keep a copy for your records.

AVAILABILITY OF TERMS. All of the terms described below are subject to change. If any of
these terms change 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.

        Termination and Acceleration. We can terminate the Plan and require you to pay us
        the entire outstanding balance in one payment, and charge you certain fees, if any of the
        following happen:

        a. You commit fraud or make a material misrepresentation at any time in connection
           with the Plan. This can include, for example, a false statement about your income,
           assets, liabilities, or any other aspect of your financial condition.

        b. You do not meet the repayment terms of the Plan.

        c. Your action or inaction adversely affects the collateral for the Plan or our rights in the
           collateral. This can include, for example, failure to maintain required insurance,
           waste or destructive use of the dwelling, failure to pay taxes, death of all persons
           liable on the account, transfer of title or sale of the dwelling, creation of a senior lien
           on the dwelling without our permission, foreclosure by the holder of another lien or
           use of funds or the dwelling for prohibited purposes.

        Suspension or Reduction. In addition to any other rights we may have, we can
        suspend additional extensions of credit or reduce your credit limit during any period in
        which any of the following are in effect:

        a. The value of your dwelling declines significantly below the dwelling’s appraised value
           for purposes of the Plan. This includes, for example, a decline such that the initial
           difference between the credit limit and the available equity is reduced by fifty percent
           and may include a smaller decline depending on the individual circumstances.

        b. We reasonably believe that you will be unable to fulfill your payment obligations
           under the Plan due to a material change in your financial circumstances.

        c. You are in default under any material obligation of the Plan. We consider all of your
           obligations to be material. Categories of material obligations include, but are not
           limited to, the events described above under Termination and Acceleration,
           obligations to pay fees and charges, obligations and limitations on the receipt of
           credit advances, obligations concerning maintenance or use of the dwelling or
           proceeds, obligations to pay and perform the terms of any other deed of trust,
           mortgage or lease of the dwelling, obligations to notify us and to provide documents
           or information to us (such as updated financial information), obligations to comply
           with applicable laws (such as zoning restrictions), and obligations of any guarantor or
           comaker. No default will occur until we mail or deliver a notice of default to you, so
           you can restore your right to credit advances.

        d. We are precluded by government action from imposing the annual percentage rate
           provided for under the Plan.



Variable Rate Home Equity Line of Credit     Revised 6/1/11                         Page 1 of 6
        e. The priority of our security interest is adversely affected by government action to the
           extent that the value of the security interest is less than 120 percent of the credit
           limit.

        f.   We have been notified by governmental authority that continued advances may
             constitute an unsafe and unsound business practice.

        g. The maximum annual percentage rate under the Plan is reached.

        Change in Terms. We may make changes to the terms of the Plan if you agree to them
        in writing at that time, if the change will unequivocally benefit you throughout the
        remainder of the Plan, or if the change is insignificant (such as changes relating to our
        data processing systems).

FEES AND CHARGES. In order to open and maintain an account, you must pay certain fees
and charges.

        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 $115.00 and $1,675.00. Upon request, we will provide you with an itemization
        of the fees you will have to pay to third parties. Lender may, at its option, provide a credit
        towards some or all of these fees during a marketing campaign.

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: 120 months (the “Draw Period”). During the Draw Period your Regular
Payment will equal the amount of your accrued finance charges. You will make 119 of these
payments. Unless you select the Ten Year Amortization Option described below, you will then
be required to pay the entire balance owing in a single balloon payment. If you make only the
minimum payments during the draw period, you will not repay any of the principal balance by
the end of the Plan. Your payments will be due monthly. Your “Minimum Payment” will be your
Regular Payment, plus any amount past due and all other charges. The Minimum Payment will
not fully repay the principal that is outstanding on your Credit Line and your final payment will be
a single balloon payment.

        Ten Year Amortization Option. If you select this option, at any point up to the end of
        your draw period, the length of your Repayment Period will be 120 months. You will not
        be able to obtain credit advances during this Repayment Period. Your payments will be
        due monthly during the Repayment Period. Your Minimum Monthly Payment will be 120
        equal principal payments plus accrued interest. The Ten Year Amortization Option has a
        Variable Rate Feature. The Annual Percentage Rate may increase during the
        Repayment Period if the rate increases on the Prime Rate as published in the Money
        Rates Section of the Wall Street Journal. The Interest Rate will not increase above
        18.000% or go below 3.250%. The rate will not increase more often than once every
        month on the first day of each month. Any increase in the rate will take the form of
        larger accrued interest payments.

        To select this Ten Year Amortization Option you must satisfy the following
        condition:

        a. You must execute a Change In Terms Agreement before the end of your Draw
           Period.

MINIMUM PAYMENT EXAMPLES.

        Draw Period. If you made only the minimum payment and took no other credit
        advances, it would take 120 months to pay off a credit advance of $10,000.00 at an
        ANNUAL PERCENTAGE RATE of 3.250%. During that period, you would make 119
        monthly payments of $27.60 and one final payment of $10,027.60.

        Ten Year Amortization Option. If you select the Ten Year Amortization Option and
        made only the minimum payment during the Draw Period and took no other credit
        advances, it would take 240 months to payoff a credit advance of $10,000.00, 120
        monthly payments of $27.60 at an ANNUAL PERCENTAGE RATE of 3.250% during the
        Draw Period, 119 monthly principal plus accrued interest payments ranging from $83.79
        to $110.93 and one final principal and interest payment of $83.56 at the initial ANNUAL
        PERCENTAGE RATE of 3.250% during the Ten Year Amortization Repayment Period.

Variable Rate Home Equity Line of Credit   Revised 6/1/11                           Page 2 of 6
TRANSACTION REQUIREMENTS. The following transaction limitations will apply to accessing
your Credit Line by writing a HomeLine Check, requesting an advance in person or requesting
an advance by mail.

        Minimum Advance Amount. The minimum amount of any credit advance that can be
        made on your Credit Line is as follows: $500.00. This means any HomeLine Check
        must be written for at least the minimum advance amount.

TAX DEDUCTIBILITY. You should consult a tax advisor regarding the deductibility of interest
and charges for the Plan.

ADDITIONAL HOME EQUITY PROGRAMS. Please ask us about our other available Home
Equity Line of Credit plans.

VARIABLE RATE FEATURE.

        The Plan has a variable rate feature during the Draw Period and the Ten Year
        Amortization Option Repayment Period. The annual percentage rate (corresponding
        with 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. Information about the Index is available or
        published daily in the Wall Street Journal’s Money Rates Section. We will use the most
        recent Index value available to us as of 14 days prior to the payment due date for 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 INFORMATION.

        Draw Period Annual Percentage Rate. To determine the annual percentage rate that
        will apply to your account, we add a margin to the value of the Index. An ANNUAL
        PERCENTAGE RATE of 3.250% is representative of the recent Prime Rate published in
        the Money Rates Section of the Wall Street Journal and subject to the interest rate floor
        as described below. 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 as discussed below.

        Ten Year Amortization Option Annual Percentage Rate. To determine the annual
        percentage rate that will apply to your account, we add a margin to the value of the
        Index. An ANNUAL PERCENTAGE RATE of 3.250% is representative of the recent
        Prime Rate published in the Money Rates Section of the Wall Street Journal and subject
        to the interest rate floor as described below. 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 as 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 periodic statements that we send
        you.

        FREQUENCY OF ANNUAL PERCENTAGE RATE ADJUSTMENTS. Your annual
        percentage rate can change on the first day of each month. There is no limit on the
        amount by which the annual percentage rate can change during any one year period.
        However, under no circumstances will your ANNUAL PERCENTAGE RATE go
        below 3.250% or exceed 18.000% per annum at any time during the term of Draw
        Period or the Ten Year Amortization Option Repayment Period.

        MAXIMUM PAYMENT AND RATE EXAMPLE.

        Draw Period. If you had an outstanding balance of $10,000.00 at the beginning of the
        Draw Period, the minimum accrued interest payment at the maximum ANNUAL
        PERCENTAGE RATE of 18.000% would be $152.88. This annual percentage rate
        could be reached at the time of the 1st payment.


Variable Rate Home Equity Line of Credit   Revised 6/1/11                         Page 3 of 6
        Ten Year Amortization Option. If you had an outstanding balance of $10,000.00 at the
        beginning of the Ten Year Amortization Option Repayment Period, the minimum monthly
        principal plus accrued interest payment at the maximum ANNUAL PERCENTAGE RATE
        of 18.000% would be $236.21. This annual percentage rate could be reached at the
        time of the 1st month of the repayment period.

PREPAYMENT. You may prepay all or any amount owing under the Plan Draw Period or the
Ten Year Amortizing Option Repayment Period, at any time without penalty.

HISTORICAL EXAMPLE. The following Index Table shows how the annual percentage rate
and the minimum payments for a single $10,000.00 credit advance would have changed during
a 120 month period, based on changes in the Index from 1996 to 2010. The Index values are as
of the last business day in July. 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 credit advances were taken and that only the minimum
payment was made. It does not necessarily indicate how the Index or your payments during the
Draw Period of the Plan would change in the future.

                                              INDEX TABLE

                                         Index        Margin (1)      ANNUAL      Monthly
Year                                   (Percent)      (Percent)     PERCENTAGE    Payment
(last business day in July)                                            RATE       (Dollars)
1996……………………………..                          8.250            0.00       8.250        70.07

1997……………………………..                          8.500            0.00       8.500        72.19

1998…………………………….                           8.500            0.00       8.500        72.19

1999……………………………..                          8.000            0.00       8.000        67.95

2000……………………………..                          9.500            0.00       9.500        80.68

2001……………………………...                         6.750            0.00       6.750        57.33

2002……………………………...                         4.750            0.00       4.750        40.34

2003……………………………...                         4.000            0.00       4.000        33.97

2004……………………………...                         4.250            0.00       4.250        36.10

2005……………………………...                         6.250            0.00       6.250        53.08

2006……………………………...                         8.250            0.00       8.250        70.07

2007……………………………...                         8.250            0.00       8.250

2008……………………………..                          5.000            0.000      5.000

2009……………………………..                          3.250            0.000      3.250

2010……………………………..                          3.250            0.000      3.250


(1) This is a margin we have recently used for our Home Equity Line of Credit Plan; your margin
    may be different.

It is the policy of The Merchants Bank to provide all Home Equity Line of Credit
applicants with the handbook entitled: “When Your Home Is On The Line: What You
Should Know About Home Equity Lines of Credit” in addition to this disclosure.



Variable Rate Draw Period Home Equity Line of Credit with a Ten Year Amortization Option.




Variable Rate Home Equity Line of Credit   Revised 6/1/11                        Page 4 of 6
                     WHAT DOES MERCHANTS BANK & MERCHANTS TRUST COMPANY
FACTS                DO WITH YOUR PERSONAL INFORMATION?

Why?                Financial companies choose how they share your personal information. Federal law gives
                    consumers the right to limit some but not all sharing. Federal law also requires us to tell you how
                    we collect, share, and protect your personal information. Please read this notice carefully to
                    understand what we do.
What?               The types of personal information we collect and share depend on the product or service you
                    have with us. This information can include:
                        Social Security number and credit history
                    When you are no longer our customer, we continue to share your information as described in this
                    notice.
How?                All financial companies need to share non public personal information to run their everyday
                    business. In the section below, we list the reasons financial companies can share their non public
                    personal information; the reasons Merchants Bank & Merchants Trust Company choose to
                    share; and whether you can limit this sharing.

Reasons we can share your personal information               Does Merchants Bank         Can you limit this sharing?
                                                                   share?
For our everyday business purposes –
                                                                      Yes                              No
Such as to process your transaction, maintain your
account(s), respond to court orders and legal
investigations, or report to credit bureaus

For our marketing purposes –
                                                                      Yes                              No
To offer our products and services to you

For joint marketing with other financial companies                    Yes                              No

For our affiliates’ everyday business purposes –
                                                                      N/A                             N/A
Information about your transactions and experiences

For our affiliates’ everyday business purposes –
                                                                      N/A                             N/A
Information about your creditworthiness

For nonaffiliates to market to you                                     No                              No


Questions?          Call 800-322-5222 or go to www.mbvt.com

Who we are
Who is providing this notice?               Merchants Bank and Merchants Trust Company
What we do
How does Merchants Bank &                   To protect your personal information from unauthorized access and use,
Merchants Trust Company protect             we use security measures that comply with federal law. These measures
my personal information?                    include computer safeguards and secured files and buildings.

How does Merchants Bank &                   We collect your personal information, for example, when you
Merchants Trust Company collect my           open a deposit account or
personal information?                        apply for a loan, or
                                             open a trust relationship
                                            We also collect your personal information from others, such as credit
                                            bureaus or when verifying information you provide to us.

Why can’t I limit all sharing?              Federal law gives you the right to limit only
                                             sharing for affiliates’ everyday business purposes – information about
                                                your creditworthiness
                                             affiliates from using your information to market to you
                                             sharing for nonaffiliates to market to you
                                            State laws and individual companies may give you additional rights to limit
                                            sharing.
Definitions
Affiliates                                  Companies related by common ownership or control. They can be
                                            financial and nonfinancial companies.
                                             None




         Variable Rate Home Equity Line of Credit   Revised 6/1/11                                Page 5 of 6
Nonaffiliates                              Companies not related by common ownership or control. They can be
                                           financial and nonfinancial companies.
                                            None

Joint marketing                            A formal agreement between nonaffiliated financial companies that
                                           together market financial products or services to you.
                                            FirstBankcard

Other important information

                                     CREDIT BUREAU REPORTING NOTICE
We may report information about your account to credit bureaus. Late payments, missed payments, or other defaults
on your account may be reflected in your credit report.
                          CUSTOMER IDENTIFICATION PROGRAM NOTICE
            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.




        Variable Rate Home Equity Line of Credit   Revised 6/1/11                              Page 6 of 6

				
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