This disclosure contains important information about your Home Equity Combination Line of Credit Account and/or your Home Equity Loan Account (Account). You should read it carefully and keep a copy for your records.

1. Availability of Terms. All of the terms described below are subject to change. If any of these terms change (other than the ANNUAL PERCENTAGE RATE) and you decide, as a result, to not enter into an agreement with us, you are entitled to a refund of any fees that you paid in connection with your application.
2. Security Interest. We will take a deed of trust on your home. You could lose your home if you do not meet the obligations in your agreement with us.
3. Possible Actions. We may take the following actions with respect to your Account under the circumstances listed below;
a. Termination and Acceleration. We may terminate your Account and require you to pay us the entire outstanding balance immediately, and charge you certain fees if any of the following happen:

(1) You engage in any fraud or material misrepresentation in connection with your Account. For example, if there are false statements or omissions on your application or financial statements.
(2) Your action or inaction adversely affects the collateral or our rights in the collateral. For example, if you fail to: maintain insurance, pay taxes, transfer title to or sell the collateral, prevent the foreclosure of any items or waste of the collateral.
(3) You do not meet the repayment terms of the Account.

b. Suspension of Credit/Reduction of Credit Limit. We may refuse to make additional advances on your line or reduce your credit limit during any period in which the following exist or occur:

(1) Any of the circumstances listed in a., above.
(2) The value of your dwelling securing the Account declines significantly below its appraised value for purposes of the Account.
(3) We reasonably believe that you will not be able to meet the repayment requirements of the Account due to a material change in your financial circumstances.
(4) You are in default under any material obligation of your Account. All of your obligations under the Account (Agreement and Deed of Trust) are material to maintaining this Account.

The categories of your obligations are set forth in the following paragraphs of these Agreements.

Home Equity Combination Line Agreement. 1. Payment; 2. Credit Line Access; 3. Security; 4. Property Maintenance/Insurance; 9. Other Costs and Charges; 14. Possible Actions; and 16. Credit Information/Financial Statements.
Deed of Trust. 1. Payments and Performance; 2. Possession and Maintenance of Property; 3. Taxes and liens; 4. Property Damage Insurance; 5. Expenditures by Credit Union; 7. Condemnation; 10.1. Consent by Credit Union; 10.2. Effect of Consent; 11. Security Agreement; Financing Statements; 14. Actions Upon Termination; 14.5. Attorneys Fees and Expenses; 16.2 Unit Ownership Power of Attorney; 16.3. Annual Reports; 16.5. Joint and Several Liability; 16.8 Waiver of Homestead Exemption; and 17.3. No Modifications.

(5) The maximum ANNUAL PERCENTAGE RATE under your Account is reached.
(6) Any 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.
(7) We have been notified by government agency that continued advances would constitute an unsafe and unsound practice.

c. Change in Terms. The 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 Draw. There is no minimum initial draw for the account.

5. Minimum Payment Requirements.
a. Home Equity Combination Line of Credit. You can obtain credit advances for five (5) years (the "draw period"). The Credit Union reserves the right to renew the draw period. During the draw period, payments will be due monthly. Your minimum monthly payment will be interest only, one percent (1%) or one and one half percent (1.5%) of the outstanding balance, adjusted after each advance. We will tell you the minimum payment percentage on the Advance Voucher, before you become obligated under the plan. Your minimum monthly payment will remain constant as the balance declines. After the draw period ends, you will no longer be able to obtain credit advances and must repay the outstanding balance (the "repayment period"). The length of the repayment period will depend on the amount of your outstanding balance, but will not exceed 15 years. During the repayment period, payments will be due monthly. Your minimum monthly payment will equal interest only, one percent (1%) or one and one half percent (1.5%) of the outstanding balance, computed as of the most recent advance. At the end of the 15-year repayment period, you will be required to repay any remaining balance in a single "balloon" payment.
b. Home Equity Loan. You must repay the outstanding balance over the repayment period. The repayment period will be up to a maximum of (180) months. We will tell you the minimum monthly payment on the Advance Voucher, before you become obligated under the plan. Your minimum monthly payment will be the amount necessary to amortize the initial outstanding balance over the repayment period at the interest rate in effect at the beginning of the repayment period. During the repayment period, you may request further loan advances up to the amount of your original balance subject to our credit and security verification. During the repayment period, payments will be due monthly.

6. Minimum Payment Example.
a. Home Equity Combination Line of Credit. If you took a single $10,000 advance at an ANNUAL PERCENTAGE RATE of 4.25% and made only the minimum monthly payments, it would take 124 months to pay off your account. During that period you would make 123 payments of $100.00 and one final payment of approximately $68.89.
b. Home Equity Loan. If you took a single $10,000 advance at an ANNUAL PERCENTAGE RATE of 4.75% and made only the minimum monthly payments, it would take 180 months to pay off your account. During that period you would make 179 payments of $77.80 and one final payment of approximately $77.69.

7. Fees and Charges. In order to open and maintain the Account, you must pay certain fees and charges.
a. Credit Union Fees. The following fees must be paid to us:

Home Equity Combination Line of Credit Annual Fee: $45.00 due on the annual anniversary of your credit line.

Prepayment Penalty: You agree to pay a fee of $500.00 if, for any reason, the loan is closed on your Home Equity Loan before the second year anniversary from your initial advance.

b. Third Party Fees. You must pay certain fees to third parties such as appraisers, credit reporting firms, and government agencies. The amount of these fees depends on the amount of the credit limit or loan amount. In addition, you must carry insurance on the property that secures this plan. The estimated total fees you must pay to third parties (i.e. title insurance, recording, flood determination, property tax tracking, etc.) is $200.00. If we require an appraisal, you must pay the appraisal fee ranging from $250.00-$450.00, in addition to the third party costs listed above. If you ask, we will give you an itemization of the fees you will have to pay to third parties. For example, for a Home Equity Combination Line of Credit or Home Equity Loan the following estimated fees must be paid to third parties:

Home Equity Loan Amount or Line of Credit: $200.00
Appraisal Fee (if required): $250.00-$450.00

8. Appraisal Report. You have the right to a copy of any real estate appraisal we use in connection with your credit application. To receive a copy, your request must be in writing to: SELCO Community Credit Union, PO Box 7487, Eugene, Oregon, 97401. We must hear from you no later than 90 days after we notify you about the action taken on your credit application or you withdraw your application.

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

10. Annual Percentage Rate. Your Account has a variable rate feature and the ANNUAL PERCENTAGE RATE (corresponding to the periodic rate) may change as a result. Any increase or decrease in the ANNUAL PERCENTAGE RATE will affect the number of monthly payments, or the amount of your balloon payment. However, we may increase your minimum monthly payment in order to avoid negative amortization. The ANNUAL PERCENTAGE RATE includes only interest and not other costs.

11. Variable Rate Features. The ANNUAL PERCENTAGE RATE is based on the value of an index. The index is the Prime Interest Rate in effect as of the 28th day of the month published in the Federal Reserve Statistical Release H.15 (519). To determine the ANNUAL PERCENTAGE RATE that will apply to your line, 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 line, rate information will be provided on periodic statements that we will send you.

12. Rate Changes. The ANNUAL PERCENTAGE RATE can change monthly on your Home Equity Line of Credit or annually on your Home Equity Loan. For Home Equity Lines of Credit there is no limit on the monthly rate adjustment. However, for either the Home Equity Line of Credit or the Home Equity Loan, during the course of a calendar year, the ANNUAL PERCENTAGE RATE cannot increase more than six percentage points (6%) and over the life of the Account, the ANNUAL PERCENTAGE RATE will not exceed eighteen percentage points (18%).

13. Maximum Rate and Payment Examples. If you had an outstanding balance of $10,000 at the beginning of your Account, the minimum monthly payment at the maximum ANNUAL PERCENTAGE RATE of 18.00% would be $151.00 (to avoid negative amortization). This ANNUAL PERCENTAGE RATE could be reached during the first month of the draw period. If you had an outstanding balance of $10,000 at the beginning of the repayment period, the minimum monthly payment at the maximum ANNUAL PERCENTAGE RATE of 18.00% would be $151.00 (to avoid negative amortization) with a final balloon payment of approximately $9,168.57 on your Home Equity Line of Credit. This ANNUAL PERCENTAGE RATE could be reached during the first month of the repayment period.

14. Historical Example The following tables show how the ANNUAL PERCENTAGE RATE and the minimum monthly payments for a single $10,000 credit advance on Home Equity Lines of Credit and Home Equity Loans under this Account would have changed based on changes in the index over the last 15 years. The index values are from December of each year. The table assumes that no additional credit advances were taken, that only the minimum payment was made each month, 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.

ANNUAL HELOC Minimum Equity Loan Minimum
PERCENTAGE Monthly Monthly
RATE Payment** Payment***
Year Index Margin*
(%) (%) (%) ($) ($)

Draw Period 1988 10.50 0.5 11.00 100.00 – 150.00 114.00
Repayment Period1989 10.50 0.5 11.00 100.00 – 150.00 114.00
1990 10.00 0.5 10.50 100.00 – 150.00 114.00
1991 6.50 0.5 7.00 100.00 – 150.00 114.00
1992 6.00 0.5 6.50 100.00 – 150.00 114.00
1993 6.00 0.5 6.50 100.00 – 150.00 114.00
1994 8.50 0.5 9.00 100.00 – 150.00 114.00
1995 8.50 0.5 9.00 100.00 – 150.00 114.00
1996 8.25 0.5 8.75 100.00 – 150.00 114.00
1997 8.50 0.5 9.00 100.00 – 150.00 114.00
1998 7.75 0.5 8.25 100.00 – 150.00 114.00
1999 8.50 0.5 9.00 100.00 – 150.00 114.00
2000 9.50 0.5 10.00 100.00 – 150.00 114.00
2001 4.75 0.5 5.25 100.00 – 150.00 114.00
2002 4.25 0.5 4.75 110.00 – 150.00 114.00

* This a margin we have used recently. Your margin may be higher, depending on the loan-to-value and your credit score.
** Your payment may be interest only, 1% or 1.5%, depending on your credit score and loan-to-value at the time we approved your loan.
*** Monthly payment is based on the index and a margin we have offered recently and a 15-year maximum repayment period based on the ANNUAL PERTENTAGE RATE in effect as of the initial advance.