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200102226
<br />LN ID #21014356
<br />provisions of the lease. If Borrower acquires fee title to the Property, the leasehold and fee title shall not be
<br />merged unless Lender agrees to the merger in writing.
<br />6. Condemnation. The proceeds of any award or claim for damages, direct or consequential, in
<br />connection with any condemnation or other taking of any part of the Property, or for conveyance in place of
<br />condemnation, are hereby assigned and shall be paid to Lender to (lie extent of the full amount of the
<br />indebtedness that remains unpaid under the Note and this Security Instrument. Lender shall apply such proceeds
<br />to the reduction of the indebtedness under the Note and this Security Instrument, first to any delinquent amounts
<br />applied in the order provided in paragraph 3, and then to prepayment of principal. Any application of the
<br />proceeds to the principal shall not extend or postpone the due date of the monthly payments, which are referred
<br />to in paragraph 2, or change the amount of such payments. Any excess proceeds over an amount required to
<br />pay all outstanding indebtedness under the Note and this Security Instrument shall be paid to the entity legally
<br />entitled thereto.
<br />7. Charges to Borrower and Protection of Lender's Rights in the Property. Borrower shall pay all
<br />governmental or municipal charges, fines and impositions that are not included in paragraph 2. Borrower shall
<br />pay these obligations on time directly to the entity which is owed the payment. If failure to pay would
<br />adversely affect Lender's interest in the Property, upon Lender's request Borrower shall promptly furnish to
<br />Lender receipts evidencing these payments.
<br />If Borrower f<iils to make these payments or the payments required by paragraph 2, or fails to perform any
<br />other c.)venants at .1 agreements contained in this Security Instrument, or there is a lcg;il proceeding that may
<br />significantly affect Lender's rights in the Property (such as a proceeding in bankruptcy. for condemnation or to
<br />enforce laws or regulations), then Lender may do and pay whatever is necessary to protect the value of the
<br />Property and Lender's rights in the Property, including payment of taxes, hazard insurance and other items
<br />mentioned in paragraph 2.
<br />Any amounts disbursed by Lender under this paragraph shall become an additional debt of Borrower and be
<br />secured by this Security Instrument. These amounts shall bear interest from the date of disbursement, at the
<br />Note rate, and at the option of Lender, shall be immediately due and payable.
<br />Borrower shall promptly discharge any lien which has priority over this Security Instrument unless
<br />Borrower: (a) agrees in writing to the payment of the obligation secured by the lien in a manner acceptable to
<br />Lender; (b) contests in good faith the lien by, or defends against enforcement of the lien in, legal proceedings
<br />which in the Lender's opinion operate to prevent the enforcement of the lien; or (c) secures from the holder of
<br />the lien an agreement satisfactory to Lender subordinating the lien to this Security Instrument. If Lender
<br />determines that anv part of the Property is subject to a lien which may attain priority over this Security
<br />Instrument, Lender may give Borrower a notice identifying the lien. Borrower shall satisfy the lien or take c.ne
<br />or more of the act_ons set forth above within 10 days of the givin- of notice.
<br />8. Fees. Lc,ider may collect fees and charges authorized by the Secretary.
<br />9. Grounds for Acceleration of Debt.
<br />(a) Default. Lender may, except as limited by regulations issued by the Secretary, in the case of
<br />payment defaults, require immediate payment in full of all sums secured by this Security Instrument if:
<br />(i) Borrower defaults by failing to pay in full any monthly payment required by this Security
<br />Instrument prior to or on the due date of the next monthly payment, or
<br />(ii) Borrower defaults by failing, for a period of thirty days, to perform any other obligations
<br />contained in this Security Instrument.
<br />(b) Sale Without Credit Approval. Lender shall, if permitted by applicable law (including Section
<br />341(d) of the Garn-St. Germain Depository Institutions Act of 1982, 12 U.S.C. 1701j -3(d)) and with
<br />the prior approval of the Secretary, require immediate payment in full of all sums secured by this
<br />Security Instrument if:
<br />(i) r.11 or part of the Property, or a beneficial interest in a trust owning all or part of' the
<br />Property, is sold or otherwise transferred (other than by devise or descent), and
<br />(ii) I lie Property is not occupied by the purchaser or grantee as his or her principal residence, or
<br />the purchaser or grantee does so occupy the Property but his or her credit has not been approved in
<br />accordance with the requirements of the Secretary.
<br />(c) No Waiver. If circumstances occur that would permit Lender to require immediate payment in
<br />full, but Lender does not require such payments, Lender does not waive its rights with respect to
<br />subsequent events.
<br />(d) Regulations of HUD Secretary. In many circumstances regulations issued by the Secretary will
<br />limit Lender's rights, in the case of payment defaults, to require immediate payment in full and
<br />foreclose if not paid. This Security Instrument does not authorize acceleration or foreclosure if not
<br />permitted by regulations of the Secretary.
<br />(e) Mortgage Not Insured. Borrower agrees that if this Security Instrument and the Note are not
<br />determined to be eligible for insurance under the National Housing Act within 60 days from the date
<br />hereof, L nder may, at its option, require immediate payment in full of all sums secured by this
<br />Security i istrument. A written statement of any authoriz_�d agent of tluc Secretary dated subscctucnt to
<br />60 days I om the date hereof, declining to insure this Security Instrument and the Note, shall be
<br />deemed conclusive proof of such ineligibility. Notwithstanding the foregoing, this option may not be
<br />exercised by Lender when the unavailability of insurance is solely due to Lender's failure to remit a
<br />mortgage insurance premium to the Secretary.
<br />10. Reinstatement. Borrower has a right to be reinstated if Lender has required immediate payment in full
<br />because of Borrower's failure to pay an amount due under the Note or this Security Instrument. This right
<br />applies even after foreclosure proceedings are instituted. To reinstate the Security Instrument, Borrower shall
<br />tender in a lump sum all amounts required to bring Borrower's account current including, to the extent they are
<br />obligations of Borrower under this Security Instrument, foreclosure costs and reasonable and customary
<br />attorneys' fees and expenses properly associated with the foreclosure proceeding. Upon reinstatement by
<br />Borrower, this Security Instrument and the obligations that it secures shall remain in effect as if Lender had not
<br />required immediate payment in full. However, Lender is not required to permit reinstatement if: (i) Lender
<br />has accepted reins :ttement after the commencement of foreclosure proceedings within two years immediately
<br />Initials: AL*-4
<br />NEFM3G - 08041999 Page 3 of 5 Doc Prep Plus, Inc.
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