Online Banking Deferral Disclosures

Acknowledgement of credit management options

Term Loans

Note: Any change you make to the loan will have an impact on the amortization, and will impact the overall cost of borrowing.

Interest-Only Payments – Eligible for Mortgage Loans Only (up to 6 months)**

  • During the deferral period, you will make a payment in the amount equal to the interest accrued.
  • When you make interest only payments, the loan principal balance will remain the same.
  • At the end of the deferral period, blended periodic payments will resume.
  • If you do not make any other changes, the number of blended periodic payments required to fully repay the loan is increased by the number of months when you made interest-only payments.
  • This results in a higher cost of borrowing for you (carrying the principal balance for a longer period of time). Refer to Disclosure Statement which will be sent by mail to your address on file.

Payment Deferral – Eligible for Personal Loans and Mortgage Loans (up to 6 months)**

  • During the deferral period, interest will continue to accrue each day (per diem) on the balance of the loan.
  • At the end of the deferral period blended payments will resume, however payments are applied to the accrued interest first.
  • Depending on the length of the deferral period, the interest rate, the principal balance and the periodic payment amount, the amount of time it will take for the periodic payments to catch up with all accrued interest and resume regular blended payments will vary.
  • If you do not make any other changes, the number of blended periodic payments required to fully repay the loan is increased.
  • This results in a higher cost of borrowing for you. Refer to Disclosure Statement which will be sent by mail to your address on file.

Lines of Credit

Line of Credit Interest Capitalization – Eligible for Personal and Mortgage Lines of Credit (up to six months)**

  • You may request the capitalization of interest payments for your Vancity lines of credit for up to six months.
  • Interest will continue to accrue on the daily closing balance, and will be capitalized on the monthly cycle date (provided there is sufficient room in the revolving credit limit).
  • Capitalization means that Vancity will calculate the accrued interest and add it to the balance at the monthly cycle date.
  • Because you will not make your monthly interest payments during the capitalization period, the principal balance will continue to increase with each monthly interest capitalization.
  • This results in an increased cost of borrowing to you. You will see these updates in your next all-in-one statement.

Vancity encourages members considering either of these options to discuss with their trusted advisor ways to reduce the increased costs of borrowing associated with the above. Vancity will allow borrowers to increase periodic payments in order to catch-up to their original amortization schedule, without penalty*

*Conditions apply

**Subject to approval by Vancity Credit Union

 

Terms and Conditions

In consideration of the Lender approving the Borrower to participate in the Lender’s Mortgage Payment Postponement Program, the Borrower hereby agrees as follows:

1. Defined Terms – In this Acknowledgement:

1.1 “Periodic Payment” means each payment of the Amount of Each Periodic Payment in accordance with the terms of the Loan Agreement;

1.2 “Postponed Payment” means the total amount of all Periodic Payments that have been postponed with respect to a request permitted by the Lender under Section 2;

1.3 “Postponement Period” means, with respect to each request permitted by the Lender under Section 2, the period as approved by the Lender during which the Borrower may postpone making one or more Periodic Payments, provided that each Postponement Period must end on the date of the last Periodic Payment permitted to be postponed;

1.4 “Triggering Event” means, with respect to the Borrower (and without reference to any Covenantor):

  1. a labour dispute affecting the Borrower’s work;
  2. a natural disaster, economic downturn or emergency situation having a general impact on the community in which the Borrower resides or works;
  3. the Borrower suffering a loss of employment or other significant source of income, or a significant reduction in income of the Borrower’s household; or
  4. any other unexpected event that, in the opinion of the Lender acting reasonably, would have a significant impact on the Borrower’s income.

1.5 Except for the definition of “Triggering Event” above, each reference to the “Borrower” is deemed to refer to all persons named above as “Borrower”, including the Covenantor(s).

1.6 Terms with initial capital letters that are used but otherwise not defined in this Acknowledgement have their meanings set out in the Loan Agreement.

2. Postponement

2.1 Borrower’s Request – If a Triggering Event has occurred, then the Borrower may request a postponement of the Periodic Payment by notifying the Lender (either in person at a branch or by calling 604-877-7000) and providing to the Lender the particulars of the Triggering Event and the proposed length and start date of the Postponement Period.

2.2 Lender’s Approval – The Lender may, in its sole discretion, approve or deny the Borrower’s request. If the request is approved, the Borrower may postpone making the Periodic Payment(s) during the Postponement Period, provided that:

  1. within any 60 month period, the total Postponement Period (with respect to all requests permitted by the Lender under Section 2) must not be longer than six months;
  2. the Loan Agreement and the Mortgage are not otherwise in default.

3. Acknowledgement of the Borrower

The Borrower acknowledges and agrees to the terms and conditions set out in this Acknowledgement and that:

  1. this Acknowledgement is not, and each request permitted by the Lender under Section 2 must not be interpreted as, an amendment or modification of the Loan or the Loan Agreement, but each such request if so permitted is deemed to be a waiver (the “Waiver”) from the Lender to permit the Borrower to deviate from the strict performance of the Loan Agreement with respect to the Periodic Payment in accordance with the terms set out in this acknowledgement; and
  2. during the Postponement Period, interest will continue to accrue on the Loan in accordance with the Loan Agreement, and that the Waiver, if granted:
  3. is only effective: (i) with respect to the postponement permitted in that Waiver, and (ii) so long as the Borrower complies with the terms of this Acknowledgement and the Borrower is not otherwise in default under the Loan Agreement and the Mortgage; and
  4. may be withdrawn at any time by the Lender in its sole discretion, in which case the postponement so permitted will cease being effective and the Borrower will resume making the Periodic Payment in accordance with the terms of Loan Agreement.

4. Loan Agreement

Except as adjusted and waived in this Acknowledgement, the Loan Agreement continues to be in full force and effect and secured by the Mortgage. Please refer to the Disclosure Statement for the adjusted Loan issued in accordance with Part 5 of the Business Practices and Consumer Protection Act (British Columbia).