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<br /> If the amounts held by Lender for Escrow Items exceed the amounLs permitted to be held by RESPA, Lender
<br /> shall account to Borrower for the excess funds as required by RESPA. IF Ihe amounts of funds held by Lender al any
<br /> time are not sufticient to pay the Escrow Iteros when due, Lender may notify the Borrower and require Borrower to
<br /> make up the shortage as permitted by RESPA.
<br /> The Escrow Funds aze pledged as additioual security for all sums secured by this Securiry InstrumenL If
<br /> Borrower tenders to Lender the full payment of all such sums, Borrower's accoant shall be credited with the 6alance
<br /> remaining for all installment items (a), (b), and (c) and any mortgage insurance premium installment tha[ Lender has
<br /> not become obligated to pay to the Secretary, and Lender shall prompUy refund any excess funds to Borrower.
<br /> Immediately prlor to a foreclosure sale of the Property or its acquisition by Lender, Borrower's account shall be
<br /> credited with any halance remaining for all installments for Items (a), (b), and (c).
<br /> 3. Applicatian of Payments. All payments uuder paragraphs 1 and 2 shall be applied by Lender as follows:
<br /> First, to the mortgage insurance premium to be paid by Lender to the Secretary or to the monthly charge 6y the
<br /> Secretary instead of the manUily mortgage insurance premlwn;
<br /> Second, to any tvices, special assessments, leasehold paymenis or ground rents, and fire, flood and other hazard
<br /> insurance premiums, as required;
<br /> Third, to interest due under the Note;
<br /> Fonrih, to amortizaflon of the principal of the Note; and
<br /> Fifth, to late charges due under the Note.
<br /> 4. Fira, Flood and Other Hazard Insurance. Borrawer shall insure all impravements on the Property, whelher
<br /> now in existence or subsequendy erected,against any hazards, casaalties, and contingencies, including fire, for which
<br /> Lender requires insurance. This insurance shall be maintained in the amounts and for tLe periods that Lender
<br /> requires. Borrower shall also insure all improvements on We Property, whether now in existence or su6sequenUy
<br /> erecled, against loss by floods lo the eactent required by the Secretary. All insurance shall be canied with companies
<br /> approved by Lender. The insurance policies and any renewals shall be held by Lender and shall include loss payable
<br /> clauses in fawr of, and in a form acceptable to, Lender.
<br /> In lhe event of loss, Borrower shall give Lender immedia[e notice by mail. Lender may make proof of loss if no[
<br /> made promptly by Borrower. Each insurance company concerned is hereby authorized and directed to make payment
<br /> for such loss directly ro Lender, instead of to Borrower and to Lender jointly. All or any parl of ihe insurance
<br /> proceeds may be applied by Lender, at its opflon, either (a) lo ihe reduction of the inde6tedness under the Note and
<br /> tlils Security Instrument, first to any delinquent amounts appl3ed in the order in para�aph 3, and then to prepayment
<br /> of principal, or (b) to �he restoration or repair of lhe damaged Property. My application of the proceeds [o the
<br /> principal shall not extend or postpone tLe due date of the monthly payments which aze referred to in paragraph Z, or
<br /> change the amoun[ of such paymenis. Any excess insurance proceeds over an amount required to pay all outstanding
<br /> indebtedness under the Note and tLis Security Instrument shall be paid to the entity legally enflUed thereto.
<br /> In the event of foreclasure of this Security Inshvment or other transfer of dtle to the Property that e�rtinguishes
<br /> the indebtedness, all right, dtle and interest of Borrower in and to insurance policies in force shall pass to lhe
<br /> purchaser.
<br /> 5. Occupancy, Preservation, Mamtenance and Prot�tion of the Property; Borrower's Loan Application;
<br /> Leaseholds. Borrower shall occupy, establish, and use ttie Property as Borrower's principal residence within sixty
<br /> days after [he execuUon of this Security I�strument (or within sixty days of a later sale or transfer of the Properly)
<br /> and shall continue to occupy Ihe Property as Borrower's principal residence for at least one year after fLe date of
<br /> occupancy, unless Lender determines that requirement will cause undue hardship for Borrower, or unless e�c[enuating
<br /> circumstances eatist which are beyond Borrower's control. Borrower shall nofify Lender of any e�ctenuating
<br /> circumstances. Borrower shall not commit waste or des[roy, damage or substanHally change the Properly or allow the
<br /> Properly to deteriorate, reasonable wear and tear excepted. Lender may inspect the Property If the Property is vacant
<br /> or abandoned or the loan is in default. Lender may take reasonable action to proted and preserve such vacant or
<br /> 89704688 �� ���
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