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<br />1. paysintat of Prtarlpal. lattmsl anti Late Cbutp. Borrower shall pay when due the prindral of. and interest on. the debt
<br />evidenced by the Note and late charges dae under the Note.
<br />3. Mostlity paytt ata of Tax". IatNraseo saA Oth" MUM. Borrower shalt include in each monthly p9 ment, together with
<br />the principal and interest as set forth in the Note and any late charges. an installment of any (a) tares 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 />insurance 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 />Lender, 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 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 tlte. payments made by Borrower for item (a), (b), or W Is
<br />insufficient to pay the item when due. then Borrower shall gay 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 whichh require advance payment 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 monthly payment shail also include either: (i) an installment of the
<br />annual mortgage insurance premium to be paid by Lender to the Secretary. or (it') a monthly charge Instead of a mortgage
<br />insurance premium if this Security instrument is held by the Secretary. Each monflhly 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 Leader the full payment of all sums secured by this Security Instrument, Borrowe 'r, account shall be
<br />credited with the balance remaining for all installments for items (a), (b) and (c) and emy =jrigag: insurance premium
<br />installment that Lender has not become obligated to pay to the Secretary, and Lender shall prrsrsl Y refund any excess funds to
<br />Borrower. Immediat Ay prior to a foreclosure sale of the Property or its acquisition Dy Urj..d•,ac, Borrower's account shall be
<br />credited with any balance remaining for all installments for items (a). (b) and t.0.
<br />3. Appl ctsibn oe Itbsaaents. Ali payments under paragraphs 1 and 2 shall )r aappl ed by Lender as follows:
<br />F,=, to the mcrrygage insur=.r. premium to be paid by Lender to the Secretdry or to the monthly charge by the Secretary
<br />instead of the monthly monSW 6MA-Mce prereium, unless Borrower paid the entire mortgage insurance premium when this
<br />Security Instrument was slsried.
<br />SE , to any taxes. spede a mt s„ Drxthold payments or ground rents. and fire, flood and other hazard insurance
<br />premiums, as required:
<br />THIRp, to inteteest erne under cite Notes.
<br />FOURTH, to ancrtu 'on of t[v principal of the Note;
<br />I`7Efi3, to late ctxWs dire coax the Note.
<br />4, Fite, deed atat tm RM Hazard llasaraace- Borrower shall insure all improvements on the Ciro erty, whether now in existence
<br />or subsequently erw a4n , vgxxtst any hazards, casualties. anti w;,w,geuclp. Li�,vaai:ats = t:. for =hich Lender requires insurance.
<br />This insurance shalC a e stained in the amounts and for the periods that L ceder rcvyuires. Borrower shall also Insure all
<br />improvements on the p ape,'tp, wgether now in existence or subsequently erem�, az ai=t Coss i'17 floods to the extent required by
<br />the Secretary. All insuran,ee ta' bt .carried with companies approved by Lender. 'i'he L- 4mra:=policies and any renewals shall
<br />be held by Lender and shall in$wie. 1tss payable clauses in iaa,or of, and in a form acce,m t-ice :,a. Lender.
<br />l;a the event of toss. Borrower shalt give Lender immediate cid=Cry mail. Lender may rtmkc,tr- lf-ref rasa if not made prompt-
<br />ly by Borrower. Eacb insurance c=pany conyt mad is hereby authorized and d- -vaed to noire Gm.%tert Co* swdt foss their fly to
<br />Lender. instead oe -)a,Lwrrower and to Lender All or any part of the inss, Ce proceeds inay be appll"c i 1,-y Lender, 2: its
<br />option, either lsr vr., ate reduction of the ia�:tedxess under the Note add! zilhis Security Instrument. rust to any delinquent
<br />amounts applied hn the order in Paragraph 10. and then to prepayment of prb—.; ar, ac <<Crir to the restoration or repair of the
<br />damaged property. Any application of the proceeds to the principal shall not extent :ar pocyaone the due date of the monthly
<br />payments which are referred to in Paragraph 2. or change the amount of such paptierr..q. tknr excess insurance proceeds over an
<br />amount required to pay all outstanding indebtedness under the Note and this SwarEt3. i! nsmaaaent shall be paid to the entity legal-
<br />ly entitled thereto.
<br />In the event of foreclosure of this Securitu Gnstrument or other transfer of title to the Property that extinguishes the in-
<br />debtedness, alt dsht, Litle and interest of Borrower in and to insurance potterer an Scree shall pass to the purchaser.
<br />Fv Fmiervation and Matatemammm of tht pirgwrty, LeasNitm ft Sctrawer shall not cv unit waste or destroy, damage or
<br />,4kc .ttitiaUy change the Property or allow the Property to d e,,c-n N a e ce3s^alsa3e wear sad er r excepted. Lender may inspect
<br />the property if *e property is vacant or abamdowed: or the loan is in defadlL L=der may :aloe reasonable action to protect and
<br />preserve such Aamat or abandoned property. CE this Security Instrument is on.t Feasehold, Borrower shall comply with the provi-
<br />sions of the lam. 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 />6. Clamor to Borrower and Protection of Lender's Rights in the Property. Borrower shall 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 famish 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 is 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 Property, 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 due and payable.
<br />7. Cosidemsitation. 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 to the reduction of the indebtedness under the Note and this Security Instrument. first to
<br />any delinquent amounts applied in the order provided in Paragraph 3. and then to prepayment of principal. Any application of
<br />the proceeds to the principal shall not extend or postpone the due date of the monthly payments, 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 />debteditess under the Note and this Security Instrument shall be paid to the entity legally entitled thereto.
<br />t). Fees. Lender may collect fees and charges authorized by the 5ecretaty.
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