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2 0�20707� In the event of foreclosure of this Security Instrument or other transfer of title to the Property that extinguishes the indebtedness, all right, title and interest of Borrower in and to insurance policies in force shall pass to the purchaser. 5. Occupancy, Preservation, Maintenance and Protection of the Property; Borrower's Loan Application; Leaseholds. Borrower shall occupy, establish, and use the Properiy as Borrower's principal residence within sixiy days after the execution of this Security Inshument (or within sixty days of a later sale or transfer of the Property) and sha11 continue to occupy the Property as Borrower's principal residence for at least one year after the date of occupancy, unless Lender determines that requirement will cause undue hardship for Borrower, or unless extenuating circumstances exist which are beyond Borrower's control. Borrower shall notify Lender of any extenuating circumstances. Bonower shall not commit waste or desiroy, damage or substantially change the Properly or allow the Property to deteriorate, reasonable weax and tear excepted. Lender may inspect the Properly if the Property is vacant or abandoned or the loan is in default. Lender may take reasonable action to protect and preserve such vacant or abandoned Property. Borrower shall also be in default if Bonower, during the loan application process, gave materially false or inaccurate information or statements to Lender (or failed to provide Lender with any material information) in connection with the loan evidenced by the Note, including, but not limited to, representa.tions concerning Borrower's occupancy of the Property as a principal residence. If this Security Instrument is on a leasehold, B orrower shall comply with the provisions of the lease. If Borrower acquires fee title to the Properly, the leasehold and fee title shall not be merged unless Lender agrees to the merger in writing. 6. Condemnation. The proceeds of any award or claim for damages, direct or consequential, in connection with any condemnation or other taking of any part of the Property, or for conveyance in place of condemnation, are hereby assigned and shall be paid to Lender to the extent of the full amount of the indebtedness that remains unpaid under the Note and this Security Instrument. Lender sha11 apply such proceeds to the reduction of the indebtedness under the Note and this Security Instrument, first to any delinquent amounts applied in the order provided in Paragraph 3, and then to prepayment of principal. Any application of the proceeds to the principal shall not extend or postpone the due date of the monthly payments, which are refened to in Paragraph 2, or change the amount of such payments. Any excess proceeds over an amount required to pay all outstanding indebtedness under the Note and this Security Insttument shall be paid to the entity legally entitled thereto. 7. Charges to Borrower and Protection of Lender's Rights in the Property. Bonower sha.11 pay all governmental or municipal charges, fines and impositions that are not included in Paragraph 2. Borrower shall pay these obligations on time directly to the entity which is owed the payment. If failure to pay would adversely affect Lender's interest in the Properiy, upon Lender's request Borrower shall promptly furnish to Lender receipts evidencing these payments. If Borrower fails to make these payments or the payments required by Paragraph 2, or fails to perform any other covenants and agreements contained in this Security Instrument, or there is a legal proceeding that may significantly affect Lender's rights in the Property (such as a proceeding in bankruptcy, for condemnation or to enforce laws or regulations), then Lender may do and pay whatever is necessary to protect the value of the Properly and Lender's rights in the Properly, including payment of talces, hazard insurance and other items mentioned in Paragraph 2. HCFG00703 FHA Deed oiTrust-NE VMP� Wokeis Kluwer Financial Services 201208234. 7 . 7 .2336J20120529Y Revised M96 OM12 Pege 4 oi 10 5 8 1