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<br />1, Payuseat of Pldaelpal, b1lo at and Late Ckwp. Borrower shall pay when due the principal of, and interest on, the debt
<br />evidenced by the Note and late charges due under the Note.
<br />3. Mwtltly Rafttseats of Taus, Insurance sad Other Chaves. Borrower shall include in each monthly payment, together with
<br />the principal and interest as at forth in the Note and any late charges. an installment of any (a) taxes and special assessments
<br />levied or to be levied against the Property. (b) leasehold payments or ground rents on the Property, and (c) premiums for
<br />four&= required by Paragraph 4.
<br />Each monthly Installment for items (a). (b ) and (c) shall equal one - twelfth of the annual amounts, as reasonably estimated by
<br />Lestder. plus an amount sufficient to maintain an additional balance of not more than one -sixth of the estimated amounts. The
<br />full annual amount for each item shall be accumulated by Lender within a period ending one month before an item would
<br />become delinquent. Lender shall hold the amounts collected in trust to pay items (a), (b) and (c) before they became delinquent.
<br />iIf at any time the total of the payments held by Lender for items (a). (b), and (c), together with the future monthly psaytomrs
<br />for such items payable to Lender prior to the due dates of such items, exceeds by more than one -sixth the esairnated amount of
<br />payments required to pay such items when due, and if payments on the Note are current, then Lender shall either refund the
<br />estotsa over am -sixth of the estimated payments or credit the excess over one -sixth of the estimated payments to subsequent
<br />Payments by Borrower. at the option of Borrower. If the total of the payments made by Borrower for items (a), (b), or (: t is
<br />tinsufi?icind to pay the item when due, then Borrower shall pay to Lender any arrsount necessary to make up the deficiency on or
<br />before the date the item becoomes due.
<br />As used in this Security instrument. "Secretary" means the Secretary of Hawing and Urban Development or his at her
<br />designee. Most Security Instrurssents insured by the Secretary are Insured under programs which require advance payattent of the
<br />entire mortgage insurance premium. If this Security Instrument is or was insured under a program which did not require advance
<br />Payment of the entire mortgage insurance premium, then each monuligy ;payment shall oho include either: (i) an installment of the
<br />annual snort prer�nlum to be paid by Lender to the Secretary, or (ii) a monthly charge instead of a mortgage
<br />} gage Insurance
<br />insurance premium if this Se` i ity Instrument is held by the Secretary. Each monthly installment of the mongaage insurance
<br />premium shall be in an amount sufficient to accumulate the full annual mortgage insurance premium with Lender one month
<br />. prior to the date the full annual mortgage insurance premium is due to the Secretary, or if this Security Instrument is held by the
<br />i Secretary, each monthly charge shall be in an amount equal to one - twelfth of one -half percent of the outstanding principal
<br />balance due on the Note.
<br />1 If Borrower tenders to Lender the full payment of all sums secured by this Security Instrument, Borrower's account shall be
<br />(I credited with the balance remaining for all installments for Items (a). (b) and (c) and any mortgage insurance premium
<br />r installment that Lender has not become obligated to pay to the Secretary, and Lender shall promptly refund any excess funds to
<br />Borrower. Immediately prior to a foreclosure sale of the Property or its acquisition by Lender, Borrower's account shall be
<br />t credked with eiuy balance remaining for ail installments for items (ap, (b) and (c).
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<br />3. Application of Payments. All payments under paragraphs I and 2 shall be applied by Lender as follows:
<br />FJ . to the mortgage insurance premium to be paid by Lender to the Secretary or to the monthly charge by the Secretary
<br />insuad of the monthly mortgage insurance premium. unless Borrower paid the entire mortgage insurance premium when this
<br />Security Instrument was signed;
<br />SECONQ, to any taxes. special assessments, leasehold payments or ground rents, and fire. flood and other hazard insurance ;=
<br />premiums. as required;
<br />to interest due under the Note;
<br />FOURTH, to amortization of the principal of the Note; -
<br />EDTH, to late charges due under the Note.
<br />4. Fine, Flood and Orison Ham d Ittr anum. Borrower shall insure a99 improvements on the Property, whether now in existence
<br />or subsequently erected, against any hazards. casualties, and contingencies, including tire, for which Lender requires insurance.
<br />This insurance shall be maintained in the amounts and for the periods that Lender requires. Borrower shall also insure all
<br />Improvements on the Properag, whether now in existence or subsequently erected. agai nst loss by floods to the extent required by
<br />the Secretary. Ali insurance shall be carried with companies approved by Lender. The insurance policies and any renewals shall
<br />be held by Lender and shall include loss payable clauses in favor of, and in a form acceptable to, .Lender.
<br />In the event of loss, Borrower than give Lender immediate notice by mail. Lender may make proof of loss if not made prompt.
<br />ly by Borrower. Each insurance company concerned is hereby authorized and directed to make payment for such loss directly to
<br />Lender. instead of to Borrower and to Lender jointly. All or any part of the insurance proceeds may be applied by Lender, at its
<br />option. either (a) to the reduction of the indebtedness under the Note and this Security Instrument, first to any delinquent
<br />amounts applied ht the order in Paragraph 3, and then to prepayment of principal. or (b) to the restoration or repair of the
<br />damaged property. Any application of the proceeds to the principal shall not extend or postpone the due date of the moath7y
<br />Payments which are referred to in Paragraph 2, or change the amount of such payments. Any excess insurance proceeds over an
<br />amount required to pay all outstanding indebtedness under the Note and this Security Instrument shall be paid to the entity legal-
<br />ly entitled thereto, i
<br />In the event of foreclosure of this Security Instrument or other transfer of title to the Property that exainguishes the in-
<br />debtedness, all right. title and interest of Borrower in and to insurance policies in force shall pass to the purchaser.
<br />S. Pseaervtstlon and Maiattsum of the Property. 1"mholds. Borrower shall not commit waste or desmoy, damage or
<br />substantially change the Property or allow the Property to deteriorate, reasonable wear and tear excepted. Lender may inspect
<br />the property if the property is v accent or abandoned or the imn is in default. Lender may take reasonable action .Cr protect and
<br />presw.,e sttc : vacant or abandon ed property. If this Secta,,it) 3uauu,rrcni is uu a leasehold. Borrower shall compile wacr zuae >cem4,e-
<br />11011s of the kase. If Borrower acquires fee title to the Property. the leasehold and fee title shall not be merged unless Lender
<br />agrees to the merger in writing.
<br />G. Chagos to Borrower and PnWWO of Leader's Rigbas in the Property. Borrower shall pay all governmental or municipal
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<br />"%M" Hm or _ay..aR.YYiN in r al osa mpaa L. Ous a uvral i,aau Pay a mw uua,a,nauaaa ura uane uarRa ay to the
<br />entity which is owed the payment. If failure to pay would adversely affect Lender's interest in the Property, upon Lender's re-
<br />quest Borrower shall promptly furnish to Lender receipts evidencing these payments.
<br />If Boaowa fails to make these payments or the payments required by Paragraph 2, or rails to perform any other covenants and
<br />agreameau contained in this. Security Instrument, or there is a legal proceeding that may significantly affect Lender's rights in
<br />die PrOPWY (such as a proceeding in bankruptcy. for condemnation or to enforce laws or regulations), then Lender may do and
<br />Pay whatever is necessary to protect the value of the Property and Lender's rights in t he Property, including payment of taxes,
<br />hazard insurance and other Items mentioned in Paragraph 2.
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<br />Any amounts disbursed by lender under this Paragraph shall become an additional debt of Borrower and be secured by this
<br />Security Instrument. These amounts shall bear interest from the date of disbursement, at the Note rate, and at the option of
<br />Lender. shall be immediately due and payable.
<br />7. Condemnation. The proceeds of any award or claim for damages, direct or consequential, in conneoion with any condom-
<br />nation or other taking of any part of the Property, or for in hereby
<br />conveyance place of condemnation, are assigned and shall be
<br />paid to Leader to the extent of the full amount of the indebtedness that remains unpaid under the Note and this Security Instru•
<br />ment. Lender shall apply such proceeds to the reduction of the indebtedness under the Note and this Security Instrument, first to
<br />ti
<br />any delinquent amounts a peed in the order provided in Paragraph 3, and then to prepayment of principal. Any application eat
<br />the proceeds to the principal shall not extend or postpone the due date of the monthly payments. which arc referred to in
<br />Paragraph 2, or change the amount of such payments. Any excess proceeds over an amount required to pay all oolmandtng in
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<br />debtedness under the Note and this Security Instrument shall be paid to the entity Icgall> entitled thereto.
<br />g. Fes. lender may collect fees and charges authorized by the Secretary.
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