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an-406669
<br />1. Payisseal of Priaelpal, latemt *sit Late Charge. 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 />2. Monti* ftyinevits of Taxes, laaarime and Other Charges. Borrower shall include in each monthly payment, together with
<br />the Levi principal or to be leleviedd interest
<br />agasnstethe Property,l(b) lea Eelioldspaym nets or Installment of
<br />rents on the Property. and ripecial
<br />Insurance rrquireA by Paragraph 4.
<br />E3aeh tnrutllrly installment for Items (a), (b) and (c) shall equal one - twelfth of the annual amounts. as reasonably estimated by
<br />Lender, pin. ^w amount sufficient to maintain an additional balance of not more than one- sixth of the estimated amounts. The
<br />full annua =cunt for each item shall be accumulated by Lender within a period ending one month before an item would
<br />become d -tlinquent. Lender shall hold cite amounts collected in trust to pay items (a). (b) and (c) before they become delinquent.
<br />If at any time the total of the payments held by Lender for items (a). (b), and (c), together with the future monthly payments
<br />for such items payable to Lender prior to the due dates of such items, exceeds by more than one -sixth the estimated 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 />excess over one -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 item (a). (b). or (c) is
<br />insufficient to pay the item when due. then Borrower shall pay to Lender any amount necessary to make up the deficiency on or
<br />before the date the item becomes due.
<br />As used in this Security Instrument, "Secretary" means the Secretary of Housing and Urban Development or his or her
<br />designee. Most Security Instruments insured by the Secretary are insured under programs which require advance payment of the
<br />entire morn {age 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 monthly payment shall also include either: (i) an installment of the
<br />annual mortgage insurance premium to be paid by Lender to the Secretary. or (ii) a monthly charge instead of a mortgage
<br />insurance premium if this Security Instrument is held by the Secretary. Each monthly installment of the mortgage 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 />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 />If Borrower tenders to Lender the full payment of all sums secured by this Security Instrument. Borrower's account shall be
<br />credited with the balance remaining for all installments for items (a), (b) and (c) and any mortgage insurance premium
<br />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 />credited with any balance remaining for all installments for items (a), (b) and (c).
<br />3. Application of Payments. All payments under psxagraphs 1 and 2 shall be applied by Lender as follows:
<br />E=. to the mortgage insurance pre:yiunt to be paid by tender to the Secretary or to the monthbr charge b,$ the Secretary
<br />instead of the monthly mortgage insuran, ce premium. unless Borrower paid the entire mortgage L119 sce presmium when this
<br />Security instrument was signed;
<br />SEC ON , to any taxes, special ascessmems, leasehold payments or ground rents, and fire, %cod and other hazard insurance
<br />premiums, as required;
<br />W , to interest due under the Note;
<br />, to amortization of the principal of the Note;
<br />FIFTH to late charges due under the Mote.'
<br />4. Fire. Flood and Other Hazard Insurance. Borrower shall insure all improvements on the Property, whether now in existence
<br />or suCSequendy erected, against any him"b, :esualve;, and contingencies, inciud5:o 1—D•e, for which Lender requires insurance.
<br />This insurance shall be maintained in the amounts and for the periods that Leudx requires. Borrower shaft t!so insure all
<br />improvements on the Property, whether now in existence or subsequently erected. against loss by floods to the extent required by
<br />the Secretary. All 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 shall 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 joint:1. AB 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, Post to any delinquent
<br />amounts applied in 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 griweeds to the principal shall not extend or postpone the due date of the monthly
<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.
<br />In the event of foreclosure of this Security Insuument or other transfer of title to the Property that extinguishes 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. Preservation said Maintenance of the Property, Leaseholds. Borrower shall not commit waste or destroy, 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 vacant o: abandoned or the loan is in default. lender may take reasonable action to protect and
<br />preserve such vacant or abandoned property. if this Security Instrument is on a leasehold. Borrower shall comply with the provi-
<br />sions of the lease. if Borrower acquires fee title to the Property, the leasehold and fee title shall mot be merged unless Lender
<br />agrees to the merger In writing.
<br />6. Charles to Bormwer and Protection of Lender's Rights in the Property. Borrower shalt pay all governmental or municipal
<br />charges. fines and impositions that are not included in Paragraph 2. Borrower shall pay these obligations on time directly 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 Borrower fails to make these payments or the payments required by Paragraph 2. or fails to perform any other covenants and
<br />agreements contained in this Security Instrument, or there ie a legal proceeding that may significantly affect Lender's rights in
<br />the Property (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 the Propeny, including payment of taxes.
<br />hazard insurance and other items mentioned in Paragraph 2.
<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 dbe and payable.
<br />7. Condemnation. The proceeds of any award or claim for damages. direct or consequential. in connection with any condem-
<br />nation or other taking of any part of the Property, or for conveyance in place of condemnation, are hereby assigned and shall be
<br />paid to Lender 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 io zhe reduction of the indebtedness under the Note and this Security Instrument, first to
<br />any delinquent amounts applied in t.':e order provided in Paragraph 3, and then to prepay mem of principal. Any application of
<br />the proceeds to the principal shaut not extend or postpone the due date of the monthly paymems, which are referred to in
<br />Paragraph 2, or change the amount of such payments. Any excess proceeds over an amount required to pay all outstanding in-
<br />debtedness under the Note and this Security instrument shall be paid to the entity legally entitled thereto.
<br />S. Fees. Lender may collect fees and charges authorized by the Secretary.
<br />Page 2 of 4
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<br />an-406669
<br />1. Payisseal of Priaelpal, latemt *sit Late Charge. 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 />2. Monti* ftyinevits of Taxes, laaarime and Other Charges. Borrower shall include in each monthly payment, together with
<br />the Levi principal or to be leleviedd interest
<br />agasnstethe Property,l(b) lea Eelioldspaym nets or Installment of
<br />rents on the Property. and ripecial
<br />Insurance rrquireA by Paragraph 4.
<br />E3aeh tnrutllrly installment for Items (a), (b) and (c) shall equal one - twelfth of the annual amounts. as reasonably estimated by
<br />Lender, pin. ^w amount sufficient to maintain an additional balance of not more than one- sixth of the estimated amounts. The
<br />full annua =cunt for each item shall be accumulated by Lender within a period ending one month before an item would
<br />become d -tlinquent. Lender shall hold cite amounts collected in trust to pay items (a). (b) and (c) before they become delinquent.
<br />If at any time the total of the payments held by Lender for items (a). (b), and (c), together with the future monthly payments
<br />for such items payable to Lender prior to the due dates of such items, exceeds by more than one -sixth the estimated 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 />excess over one -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 item (a). (b). or (c) is
<br />insufficient to pay the item when due. then Borrower shall pay to Lender any amount necessary to make up the deficiency on or
<br />before the date the item becomes due.
<br />As used in this Security Instrument, "Secretary" means the Secretary of Housing and Urban Development or his or her
<br />designee. Most Security Instruments insured by the Secretary are insured under programs which require advance payment of the
<br />entire morn {age 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 monthly payment shall also include either: (i) an installment of the
<br />annual mortgage insurance premium to be paid by Lender to the Secretary. or (ii) a monthly charge instead of a mortgage
<br />insurance premium if this Security Instrument is held by the Secretary. Each monthly installment of the mortgage 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 />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 />If Borrower tenders to Lender the full payment of all sums secured by this Security Instrument. Borrower's account shall be
<br />credited with the balance remaining for all installments for items (a), (b) and (c) and any mortgage insurance premium
<br />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 />credited with any balance remaining for all installments for items (a), (b) and (c).
<br />3. Application of Payments. All payments under psxagraphs 1 and 2 shall be applied by Lender as follows:
<br />E=. to the mortgage insurance pre:yiunt to be paid by tender to the Secretary or to the monthbr charge b,$ the Secretary
<br />instead of the monthly mortgage insuran, ce premium. unless Borrower paid the entire mortgage L119 sce presmium when this
<br />Security instrument was signed;
<br />SEC ON , to any taxes, special ascessmems, leasehold payments or ground rents, and fire, %cod and other hazard insurance
<br />premiums, as required;
<br />W , to interest due under the Note;
<br />, to amortization of the principal of the Note;
<br />FIFTH to late charges due under the Mote.'
<br />4. Fire. Flood and Other Hazard Insurance. Borrower shall insure all improvements on the Property, whether now in existence
<br />or suCSequendy erected, against any him"b, :esualve;, and contingencies, inciud5:o 1—D•e, for which Lender requires insurance.
<br />This insurance shall be maintained in the amounts and for the periods that Leudx requires. Borrower shaft t!so insure all
<br />improvements on the Property, whether now in existence or subsequently erected. against loss by floods to the extent required by
<br />the Secretary. All 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 shall 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 joint:1. AB 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, Post to any delinquent
<br />amounts applied in 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 griweeds to the principal shall not extend or postpone the due date of the monthly
<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.
<br />In the event of foreclosure of this Security Insuument or other transfer of title to the Property that extinguishes 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. Preservation said Maintenance of the Property, Leaseholds. Borrower shall not commit waste or destroy, 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 vacant o: abandoned or the loan is in default. lender may take reasonable action to protect and
<br />preserve such vacant or abandoned property. if this Security Instrument is on a leasehold. Borrower shall comply with the provi-
<br />sions of the lease. if Borrower acquires fee title to the Property, the leasehold and fee title shall mot be merged unless Lender
<br />agrees to the merger In writing.
<br />6. Charles to Bormwer and Protection of Lender's Rights in the Property. Borrower shalt pay all governmental or municipal
<br />charges. fines and impositions that are not included in Paragraph 2. Borrower shall pay these obligations on time directly 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 Borrower fails to make these payments or the payments required by Paragraph 2. or fails to perform any other covenants and
<br />agreements contained in this Security Instrument, or there ie a legal proceeding that may significantly affect Lender's rights in
<br />the Property (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 the Propeny, including payment of taxes.
<br />hazard insurance and other items mentioned in Paragraph 2.
<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 dbe and payable.
<br />7. Condemnation. The proceeds of any award or claim for damages. direct or consequential. in connection with any condem-
<br />nation or other taking of any part of the Property, or for conveyance in place of condemnation, are hereby assigned and shall be
<br />paid to Lender 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 io zhe reduction of the indebtedness under the Note and this Security Instrument, first to
<br />any delinquent amounts applied in t.':e order provided in Paragraph 3, and then to prepay mem of principal. Any application of
<br />the proceeds to the principal shaut not extend or postpone the due date of the monthly paymems, which are referred to in
<br />Paragraph 2, or change the amount of such payments. Any excess proceeds over an amount required to pay all outstanding in-
<br />debtedness under the Note and this Security instrument shall be paid to the entity legally entitled thereto.
<br />S. Fees. Lender may collect fees and charges authorized by the Secretary.
<br />Page 2 of 4
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