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Prepayment Option

Loans with the Prepayment Option have prepayment penalties that are due if the loan is prepaid or converted during the designated prepayment period. Due to the prepayment penalty, GreenStone is able to pass savings on to the customer resulting in lower rates. This option is available for 5, 7 and 10 year adjustable rate real estate loans and 10 year fixed rate real estate loans.

This loan option may be appropriate if you have large to midsize loan needs and are willing to give up some flexibility for a lower rate.

Prepayment Premium Period

Loans with the Prepayment Option are subject to a prepayment premium during the following time periods:

Fixed Rate period	Prepayment Premium (PP) Period
5 years	3 years
7 years	3 years
10 years	3 years

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Prepayment Premium

The prepayment premium is equivalent to 2 months of interest on the amount prepaid times the number of years remaining to the end of the Prepayment Premium Period. This premium is charged for both prepayments and conversions. The formula is:

Bill Rate/6 x Yrs Remaining in PP Period x Amount Prepaid

Example:

Bill Rate = 8.5%
Prepaid Amount=$20,000
33 months to end of PP Period

8.5% divided by 6 = 1.42%

1.42% x 2.8 years x $20,000= $795.20

Exceptions

Premium is not charged if the 3 year U.S. Treasury rate on the date of prepayment is higher than it was on the original rate commitment date.

Funds Held Limit

Customers with the Prepayment Option are limited to a maximum 10% of their original loan balance in funds held at any time.

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