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201209876 2. Monthly Payment of Taxes, Insuranceand Other Charges.Borrower shall include in each monthly payment,together with the priucipal and iuterest as set forth in the No[e and any late charges,a sum for (a)taxes and special assessmeuts levied or to be levied against the Property, (b)leasehold payments or ground rents on the Property,and(c)premiums for insurance required under paragraph 4. In auy year in which the Lender must pay a mortgage insurance premium to the Secretazy of Housing and Urban Developmeut("Secretary"),or in any year iu which such premium would have been required if Lender still held the Security Instrument, each monthly payment shall also include either: (i)a sum for the annual mortgage insurauce premium to be paid by Lender W the Secretary, or(ii)a monthly charge instead of a mortgage insurance premium if this Security Inshvment 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 are called "Escrow Items"and the sums paid to Lender aze called"Escrow Funds." Lender may, at any time, collect and hold amounts for Escrow Items in an aggregate amount not to exceed the maximtun amount that may be required for Bonower's escrow account uuder the Real Estate Settlement Procedures Act of 1974, 12 U.S.C. Section 2601 et seq. and implementing 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 u¢anticipated disbursements or disb�rsements before the Borrower's payments aze available in the accouat may not be based on amounts due for the mortgage insura¢ce premium. If the amounts held by Lender for Escrow Items exceed the amounts permitted to be held by RESPA, Lender shall account to Borrower for the excess funds as required by RESPA. If the amounts of funds held by Lender at any time aze not sufficieat to pay the Escrow Items when due, Lender may notify the Boirower and require Borrower to make up the s6ortage as permitted by RESPA. The Escrow Fuuds are pledged as additional secwiry for all sums sectued by this Security Iastrument. If Borrower tenders to Lender the full payment of all such sums,Borrower's account shall be czedited with the balance remaining foc all installment items(a), (b),and(c)and auy modgage insurance premium installment that Lender has not become obligated to pay to the Secretary, and Lender shall promptty refund any excess funds to Bonower. Immediately prior to a foreclosure sale of the Property or its acquisition by Lender,Borrower's account shall be credited with auy balauce remaining for all installments for items(a), (b),and(c). 3. Applicationof Payments.All payments under pazagraphs 1 and 2 shall be applied by Lender as follows: Fir ,st to the mortgage insurance premium to be paid by Lender to the Secretary or to the monthly chazge by the Secretary instead of the monthly mortgage insurance premium; on to any taxes, special assessments, leasehold payments or ground rents, and fire, flood and other hazard insurance premiums,as required; Third• to interest due under the Note; Fourth" to amortizatiou of the priucipal of the Note; aud Fifth to late charges due under the Note. 4. Fire,Floodand pEher Hazard Insurance.Borrower shall insure atl improvements on the Property, whether uow in existence or subsequently erected, agaiast any hazazds, casualties,and contingencies, including fire, for which Lender requires insurance. This insurance shall be maintained in the amounts and for t6e periods that Lender requ'ues. Borrower s6a11 also insure all improvements on the Property,whether now in existence or subsequently erected,against loss by floods to the extent required by the Secretary.All iasurance shall be carried with companies approved by Lender. The inswance 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 Martgage WITH MERSIJE Revlsed 6/96 Wo11e�K1uwsrFlrenclal5ervkes IIIII' IIIIIIII IIIII IIIIIII IIIII VMP4N(Np�(1839�00� q03312381356 0233 292 0310 I ✓ /