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201206728 2. Monthly Payment of Taxes, insuranceand Other Charges.Borrower shall include in each mo❑thly payment, together with the principal and interest as set fodh in the Note and any late charges,a sum for (a)taxes and special assessments levied or to be levied against the Froperty, (b)leaschold payments or ground rents on the Property,and (c)premiums for insurance requued under pazagraph 4. In a¢y year i� which the Lender must pay a mortgage insurance premium to the Secretary of Housing and Urban Development("Secretary"), or in any yeaz in which such premium would have been required iF Lender still held the Secttrity Iustrumeut, each mont6ly payment shall also include either: (i)a sum for the annual modgage insurance premium to be paid by Lender to the Secretary,or(ii)a monthly charge instead of a mortgage insurance premium if this Security Instrument is held by the Secretary, in a reasonable amount to be determined by the Secretary. Except for the monthly charge by the Secretary,these items aze called "Escrow Items" and the sums paid to Lender are called "Escrow Funds." Lender may,at any time,wllect and hold amounts for Escrow Items in an aggregate amount not to exceed the maximum amount that may be required for Borrower's escrow account under the Real Estate Settlement Procedures Act of 1974, 12 U.S.C. Section 2601 et seq. and implemeuting regulations, 24 CFR Part 3500, as they may be amended from time to time("RESPA"), except that the cushion or reserve permitted by RESPA for unanticipated disbursemeuts or disbursements before the Borrower's payments are available in the account may not be based on amounts due for the mortgage insurance premium. If the amounts held by Lender for Escrow Items exceed the amounts permit[ed to be held by RESPA, Lender shall account to Bonower for the excess funds as requued by RESPA. If the amounts of funds held by Lender at any time are not suf£icien[to pay the Escrow Items when due, Lender may notify the Borrower and require Borrower to make up the shortage as permitted by RESPA. The Escrow Funds are pledged as additional secwity for all sums secured by this Security Instrument. If Borrower teuders to Lender the full payment of all such sums, Borrower's aceount shall be credited with the balance remaining for all installment items(a), (b), and(c)a�d any mortgage insurance premium installmeni that Lender has not become obligated to pay to the Secretary, and Lender shall promptly refund any excess funds to Borrower.Lnmediately prior to a foreclosure sale of the Property or its acquisition by Lender,Borrower's accouut shall be credited with any balance remaining for all installments for items(a), (b),and(c). 3. Applicationof Payments.All payments under paragraphs 1 aud 2 shall be applied by Lender as follows: First" to the mortgage insurance premium to be paid by Lender to the Secretary or to t6e monthly charge by the Secretary instead of the monthly mortgage insurance premium; Secon to any taxes, special assessments, leasehold payments or ground rents, and fae, flood and other hazard insurance premiums,as required; Thu ,d W interest dae under t6e Note; Fourth to amortization of the principal of the Note; and Fifth to late charges due uuder the Note. 4. Fire,Floodand Other Hazard Insurance.Borrower shall insure all improvemeuts on the Property, whether now in existence or subsequeutly erected, against any hazards, casualties,and contingencies, including fue, for which Lender requires insurance. This insurance shall be maintained in the amounts and for the periods that Lender requires.Borro�ver shall also insure all improvements on the Property,whether uow in existence or subsequently erected,against loss by floods to the extent required by the Secretary.All insura�ce shall be carried with companies approved by Lender. The insurance policies and any renewals shall be held by Lender and shall include loss payable clauses in favor of,and in a form acceptable to,Lender. FHA Mortgage W ITH MERS-NE �� ReviseQ 4f98 Amentled 7/04 VMP� VMP4N(NE)(7105).00 �II IIIIIIIIIrIII III�II I III IIIIIII I IIII I I II I'II�III Page 3 ot 70 q03309009325 0233 329 0310