ELECTRONIC FUNDS TRANSFER AGREEMENT AND DISCLOSURE

This Agreement is between the Credit Union member (designated as “you”, “your”) and Michigan Schools and Government Credit Union (designated as “we”, “us”, “our”).

This Electronic Funds Transfer Agreement describes the type of Electronic Funds Transfer (“EFT”) services that we provide. This Agreement should be reviewed carefully, since it informs you of the terms and conditions which apply to these services. The terms of this EFT agreement pertain to consumer accounts only. Different provisions may apply to business accounts and transactions. You are bound by the terms of this agreement if you use the account(s) covered by the disclosure after the receipt of this agreement and/or if you ask us to provide you with an ATM card and/or a PIN and you thereafter use them to make such transactions.

Should any inconsistencies exist between these terms and conditions and the general rules and regulations of your deposit account(s), these terms and conditions govern with regard to EFT services. Please keep this Agreement for future reference.

TYPES OF SERVICES

Accounts Affected: Each of the following types of accounts in the Credit Union can be subject to some kind of “Electronic Funds Transfer” service:

• Regular Share Account
• Regular Checking Account
• Money Market Checking Account
• Silver Share Account
• Gold Share Account
• Holiday Club Account
• Loan Line of Credit

These types of accounts are sometimes referred to in this Agreement as “asset account(s)” or simply as your “account(s)”. You have previously designated which of your account(s) you want to be subject to a particular type of Electronic Funds Transfer service. You may change those instructions in the future, and we will follow your new wishes to the extent our Electronic Funds Transfer programs permit at that time.

Automated Clearing House Transfer Services: We offer preauthorized EFT services through the Automated Clearing House System. We are able to electronically transfer funds from your account(s) to accounts at other financial institutions or receive funds electronically from other financial institutions for deposit in your account. Because you must authorize such transfers in advance, these transfers are called “Preauthorized Transfers”. Some of the services offered as preauthorized transfers are direct deposit of payroll, Social Security and other government payments and automatic bill payment services.

Electronic Funds Transfer Services: At the present time, the following types of Electronic Funds Transfers to or from your account(s) in the Credit Union may be authorized:

Transfers TO your account(s) (credits):
• Deposit of payroll deductions from various employers which have agreed to send such deposits to us.
• Direct deposit of various governmental benefits.
• Deposit(s) from any third party through the facilities of the Automated Clearing House Association.
• Automatic transfers to your account(s) from another person’s account with us.

Transfers FROM your account(s) (debits):
• Electronic check conversion.
• Automatic deduction from your account of premiums for insurance coverage available to our members.
• Payments of your house mortgage payments, insurance payments and utility bills, as well as other types of payments to third parties, through the facilities of the Automated Clearing House Association.
• Automatic transfers from your account(s) to another person’s account with us.
• Automatic transfers from your account(s) to make payments on another person’s loan owing to us.
• As to transactions other than those made at an authorized ATM, there are, at the present time, no limitations as to how often you can make EFTs, nor are there any restrictions as to the dollar amount of any one EFT. However, no transfer or withdrawal from your share account will be made by phone if earlier in the same month, 6 (six) transfers or withdrawals from the account have been made by phone or pursuant to authorization you previously gave us.

Automated Teller Machine (ATM) Transactions:
If you have an VISA Debit card for which we have issued a Personal Identification Number (PIN), you can use it to make any or all of the following transactions at any Automated Teller Machine network which is a part of an Electronic Funds Transfer service network to which we belong (Some transactions listed below may not be available to all networks.)

• Deposits to your Regular Share account, Regular Checking account, Money Market Checking, Silver Share account, Gold Share account and Holiday Club account.
• Transfer of funds between any of the aforementioned accounts.
• Cash withdrawals from any of the aforementioned accounts, (excluding Holiday Club account) plus advances from the Line of Credit to one of the aforementioned accounts.
• Verify balances on any of the aforementioned accounts and any loan account.

In order to assist us in maintaining the security of your account and the terminals, the Card remains our property and may be revoked or canceled at any time without giving you prior notice.

Notice Regarding ATM Fees By Others:
If you use an Automated Teller Machine that is not operated by us, you may be charged a fee by the operator of the machine and/or by an automated transfer network. If we reissue an electronic access card that has been lost, stolen, damaged, or confiscated for improper use we will charge our normal service charge according to our current Fee Schedule. If there are not sufficient funds in your account(s) to pay an EFT from the account we will charge our normal service charge according to our current Fee Schedule.

Point of Sale Transactions:
If you have a VISA Debit card for which we issued you a PIN, you may also use it to purchase goods or services from merchants who have arranged to accept your VISA Debit card as a means of payment. These merchants are referred to as “Participating Merchants” and will display a logo or other symbol which identifies them as a merchant who will accept your card. Purchases made with your VISA Debit card, including any purchases where you receive cash back, are referred to as “point of sale” transactions or “POS” transactions and will cause your Regular Checking account to be debited for the amount of the purchase. Only share draft accounts may be used in connection with point of sale transactions performed with your VISA Debit card.

Telephone Audio Response Services/PC Access: You may also call the Credit Union and, upon furnishing the Credit Union with information to identify yourself, transfer money between your accounts, transfer money from your account to another person’s account, transfer money to make loan payments, and verify balance inquiries in specified accounts.

You have previously told us which of these Electronic Funds Transfer services you want to use. You can discontinue use of any such service whenever you want to. If you begin using a different Electronic Funds Transfer service after receipt of this Agreement, we must be notified of the account(s) to be affected. We may make additional types of Electronic Funds Transfer services available in the future. We may also discontinue one or more of our Electronic Funds Transfer services, but if we do that, we will give you at least twenty-one (21) days advance notice in writing.

Excluded Transactions: We have developed an elaborate electronic data processing system which makes it possible to offer you many electronic services. However, some of these services do not constitute “Electronic Funds Transfers” for the purposes of this Agreement such as, for example, automatic transfers from your account(s) to pay your loan(s) owing to us and automatic services and transfers which are “electronic funds transfers” as described above. They do not apply to other transactions which, although electronic in nature, do not constitute “Electronic Funds Transfers” described above.

SERVICE LIMITATIONS

Minimum Balance: You must always maintain a minimum of $5 in a Regular Share Account to be entitled to make “Electronic Funds Transfers” affecting your account. We reserve the right to increase the minimum balance requirement or to impose other restrictions in the future, but if we do so, we will give you at least twenty-one (21) days advance written notice.

Limitation on Number of Transactions: No limitation on number of transactions or withdrawals per day except as described elsewhere in this disclosure.

Limitation on Dollar Amounts of ATM and Point of Sale Transfers:
• $500 at Proprietary and Network machines per day.
• Daily limit for point of sale purchases is based on the available funds in the member’s default account.

RIGHTS AND RESPONSIBILITIES

Notification of Regulatory Authorities: This Agreement and the EFT services provided in this Agreement are governed by Michigan law. You may notify the Federal or State agency noted below of any violation of law.

The address of this agency is as follows:
Credit Union Division
Office of Financial and Insurance Services
P.O. Box 30224
Lansing, Michigan 30220

Electronic Funds Transfer (VISA Debit) Card: If you have received a VISA Debit card (“Card”) from us for the type of terminal transfers noted previously, the following provisions are applicable.
• You agree not to use your Card for a transaction that would cause your account balance to go below zero. The Card may only be used with your Personal Identification Number (“PIN”), which is used to identify you as an authorized user of the Card. Because the PIN is used for identification
purposes, you will agree to notify us immediately if the Card is lost or if the secrecy of the PIN is compromised.
• We will not be required to complete any such transaction, but if we do, you do agree to pay us the amount of the improper withdrawal or transfer upon request.
• You also agree not to reveal your PIN to any person not authorized by you to use the Card.
• You agree not to write the PIN on the Card or on any item kept with the Card. The security of your account depends upon you maintaining possession of your Card and the secrecy of your PIN.

Documentation of Transfers

Terminal Transfers: You will get a receipt at the time you make any EFT transaction (unless you request otherwise) to or from your account at an ATM terminal or a Participating Merchant.

Preauthorized Transfers: If you have arranged to have direct deposits made to your account at least once every sixty (60) days from the same person or company, you can call or write us to find out whether or not the preauthorized deposit has been made to your account at the telephone number and address appearing on your periodic statement or as shown on this Agreement.

Statements:
• If your preauthorized transfer/ATM terminal transaction affects your Share Draft account, these transactions will be noted on your monthly statement.
• If your preauthorized transfer/ATM terminal transaction affects your Share account, you will receive a monthly statement unless there were no transactions in a particular month, in which case you would receive your normal quarterly statement.

Your Right to Stop Payment of Preauthorized Transfers

Rights and Procedures to Stop Payments: If you have told
us in advance to make regular payments out of your account, you can stop any of these payments. Here’s how:

CALL: (586) 263-8800
OR
WRITE:
Michigan Schools and Government Credit Union
40400 Garfield Road
Clinton Township, MI 48038

Your call or written requests needs to be received by us three (3) business days or more before item is presented for payment. If you call, we may also require you to put your request in writing and get it to us within fourteen (14) days after you call. The fee for handling such stop payment orders is disclosed in a separate Fee Schedule.

Notice of Varying Amounts: If these regular payments may vary in amount the person you are going to pay will tell you, ten (10) days before each payment, when it will be made and how much it will be. You may choose instead to get this notice only when the payment would differ by more than a certain amount for the previous payment, or when the amount would fall outside certain limits that you set.

Liability for Failure to Stop Payment of Preauthorized Transfer: If you order us to stop one of these payments three (3) business days or more before the transfer is scheduled, and we do not do so, we will be liable for your losses or damages.

In Case of Errors or Questions About Your Electronic Funds Transfers: Call us at (586) 263-8800 or write to the address appearing on your periodic statement or as indicated above as soon as you can if you think your periodic statement or receipt is wrong, or if you need more information about a transaction listed on the periodic statement or receipt in order to assert an error. For consumer accounts, we must hear from you no later than sixty (60) days after we send the FIRST periodic statement on which the problem or error appeared. You must do all of the following:

(1) Tell us your name and account number.
(2) Describe the error or transfer you are unsure about and explain as clearly as you can why you believe it is an error or why you need more information.
(3) Tell us the dollar amount of the suspected error. If you tell us orally, we may require that you send us your complaint or question in writing within ten (10) business days.

We will tell you the results of our investigation within ten (10) business days (or twenty (20) business days for claims made within thirty (30) calendar days of the first deposit into an account that is a new account). If we need more time, however, we may take up to forty-five (45) calendar days (ninety (90) calendar days for point of sale transactions, foreign initiated transfers, or for a claim on a new account). If we decide to do this, we will re-credit your account within ten (10) business days (or twenty (20) business days on claims for new accounts) for the amount you think is in error, so you will have the use of the money during the time it takes us to complete our investigation.

We will tell you the results within three (3) business days after completing our investigation. If we decide that there was no error, we will send you a written explanation. You may ask for copies of the documents that we used in our investigation.

Clearing of Deposits: Deposits made at an ATM whether in cash, check, draft or money order are subject to our Funds Availability Policy. The policy is included in this disclosure agreement.

Crediting Payments: Payments made at ATMs whether in cash, check, draft or money order are subject to verification and the posting of such payment to a loan account may be delayed until the funds can be collected.

Responsibility for Overdraft: If you obtain cash from an ATM or withdraw via a Point of Sale transaction which creates an overdraft in your regular share or share draft account(s), the overdraft amount is due and payable the moment you get it and you agree to pay the full amount of it to us, together with the service charge, if applicable. You also authorize us in such a case to apply from any other Share account, Checking account, Club account or Line of Credit you may have in the Credit Union such amount as to be necessary to pay the overdraft amount and service charge.

Notice of Loss or Theft: If you believe your Card has been lost or stolen or that someone has transferred or may transfer money from your account without your permission,

CALL: (586) 263-8800 during business hours OR
(800) 991-4965 after hours
or
WRITE:
Michigan Schools and Government Credit Union
40400 Garfield Road
Clinton Township, MI 48038

Special Liability Protection Rules for VISA Debit Card:
Unless you have been grossly negligent or have engaged in fraud, you will not be liable for any unauthorized transactions made with your lost or stolen VISA Debit Card, when used for POS transactions (excluding transactions made at an ATM), as long as you report the loss or theft of your VISA Debit Card within two (2) business days of when you discover it is missing. If you do not tell us within two (2) business days, your liability is the lesser of $50 or the amount of funds, property, labor or services obtained through the unauthorized use before you notified us. If your card was lost due to your gross negligence, or if you have handled your card fraudulently, these special rules do not apply, and your liability for the unauthorized use of your VISA Debit Card is addressed in the section titled “Consumer Liability”.

Consumer Liability: Tell us AT ONCE if you believe your Card has been lost or stolen. Telephoning is the best way of keeping your possible losses down. You could lose all the money in your account (plus your maximum overdraft line of credit). If you tell us within two (2) business days, you have no liability for fraudulent charges.

If you do NOT tell us within two (2) business days after you learn of the loss or theft of your Card, and we can prove we could have stopped someone from using your Card without your permission if you had told us, you could lose as much as $50.

Also, if your statement shows transfers you did not make, tell us at once. If you do not tell us within sixty (60) days after the statement was mailed to you, you may not get back any money you lost after the sixty (60) days if we can prove that we could have stopped someone from taking the money if you had told us in time.

Reversal of Transaction: We will reverse an EFT transfer resulting from a point of sale transaction at a Participating Merchant in Michigan and re-credit your account for the full amount of the transfer if all of the following occur:

(1) You provide us notice of having made a good faith attempt to seek redress and make an assurance to us of the return to the Participating Merchant of related goods in dispute, where returnable goods are involved.
(2) The amount of the transaction is $50 or more.
(3) Within four (4) calendar days following the transaction, we receive from you during our normal business hours, a written or oral request for the reversal.
(4) You verify the reverse order, notice and assurance in writing within fourteen (14) calendar days following oral notification, on a form to be provided by us for that purpose. If written verification is not furnished, we shall reinstate the original debits and credits involved in the transaction to the extent of the available account balance.

Disclosure of Account Information to Third Parties: We will disclose information to third parties about your account or the transfers you make:
(1) Where it is necessary for completing transfers; or
(2) In order to verify the existence and condition of your account for a third party, such as a credit bureau or merchant;
or
(3) In order to comply with government agency or court orders: or
(4) If you give us your written permission.
(5) If the information relates to improper use of your account(s).

Liability for Failure to Complete EFT Transfers: If we do not properly complete an EFT transfer to or from your account on time or in the correct amount in accordance with the terms of this Agreement, we will be liable for your losses or damages. However, there are some exceptions. We will NOT be liable, for instance:

• If, through no fault of ours, you do not have enough money in your account to make the transfer.
• If we have terminated this Agreement or the transaction would have exceeded your established credit line.
• If the terminal or any part of the system supporting the operation of the terminal was not working properly, and you knew of the breakdown when you began the transaction or at some time during the process of the transaction.
• If the terminal where you attempted to make the transaction did not have enough cash to allow the transaction.
• When your Card has been reported lost or stolen or we have reason to believe that something was wrong with the transaction.
• When, despite reasonable precautions taken by us, an act of God or other circumstance beyond our control interfered with or prevented the transaction.
• When we receive inaccurate or incomplete information needed to complete a transaction.
• If any necessary authorization for completing the EFT transfer has been revoked by an operation of law.
• In the case of preauthorized transfers, we will not be liable where there was a breakdown of the system which would normally handle the transfer at the time the transfer would have occurred.
• There may be other exceptions provided by applicable law.

Amendments: We may change or amend any of the terms and conditions of this Agreement at any time upon at least twenty-one (21) days written notice to you prior to the effective date of any change or amendment. Your failure to timely furnish notice as set forth below shall be deemed to be your acceptance of such change or amendment. If you do not agree to abide by a change or amendment, you must notify us of the fact prior to the effective date of the change or amendment. You must also surrender your Card and cancel this Agreement.

Termination of Prior Agreements: Upon your receipt of this Agreement, this Agreement terminates any earlier Electronic Funds Transfer agreements provided to you from us.