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<br /> if che amounts heid by Lender for Fscrow Items excet� the amounu permitted to be heid by RFSP�t�__Lender
<br /> shall account to Borrowzr for the excess funds as requir�.by PESPA. If the amounts of functs held 3y L.ender at ac�y
<br /> tinse are not su�ficient to g�y the Fscrow Items whsn due, Lender may notify eh�Borrowez and require Borrowes to
<br /> make up:he shortage as permitted hy RL-:SPA. •
<br /> The Escrow Funds are pledged as add;tional security for al[ sums secured by this Security Inscrument. If
<br /> Borrower tenders to Ixnder the full payruen�of ail su:h sums, gorrowtr's accuunt shall be crediced with the balane� '
<br /> re�na.ir:ing fer a!I installmenc items(a), (b), and(c);.nd any mo:tgage inszerance premium installment that Lender has
<br /> noc become ob�iguai to pay to the Secretary, and I.ender st,alt prompdy refun�l any excess {u$ds to Sotrower.
<br /> [mmediateiy prior ro a forcclosure saEe of �ha Properry or its xquisition by Lender, Borrower's account shall be
<br /> credited wic6 any balance cemaining for a!1 iusealimenes for items(a),(b}, and(e). .
<br /> :i. Application of�yments, qll paymeacs un�+er paragraphs I and 2 sh�ll be�plied by Lender 3s follows:
<br /> Firsc, to che martgage ir,surance premium to bs paid by Lender to the Secretary or to the monthly charge by tne
<br /> Secretary instead of the manthly mortgage insurance prtmium;
<br /> Second, [e any ta�ccs, special assessments, iea�eho?�+ payments or ground rents, and fire, tlood and othcr hazard
<br /> insurance pre*�-�iums, as requimi; . ,
<br /> Third, to inter�t due under the Nc��e;
<br /> Fonrth, to amortization of the princi�.:!�f the Nate; and
<br /> Fifth, to late ct;azgcs due under the Not�.
<br /> a. Fire, Flood and Other fiauird InSUtance.Borrower shall insure all improvements on the Property, whether
<br /> now in ezistenre or subsequen:ly erected, against any hazards,casu;il�rs, and��ntingencies, including fire, for which
<br /> Lender rcquires insurance. This i:LSnranc.r �halj be maintained in the amoknts and for the periods that [.end•_r
<br /> requires. Borrower s5a11 also insure ali iinprovements an ihc Prope;ty, whecher now in ezistcnce or subscquently
<br /> erected, against loss by floods ta tt;�eztent requircd by the Sr,crctary, All insurance shall b�carried w�ith companies
<br /> approved by Lcr.der. The insurancc�olicSes and any renewals shal: be held by L.ender:uid shall include loss payable
<br /> clauses in favor of, and�n a form acceptable to;Lrnder.
<br /> In the event of loss, Borrower shall give Lender immediate notice by mail. Lender may make proof ef Ioss if not
<br /> made promptly by BorrowEr. Each insurance company concerned is herebp authorized aud directed [o make paymant
<br /> for such ioss dircccly to Ixnder, instcad of to BaRn�ver and to Lender joindy. Afl or any part of the insurance
<br /> proceeds may he applied by i,onder, at its option, either(a) to th� reduction of che indebtedness under the Note and
<br /> this Sa:uriry Instrumen[, Frst to any delinquer�t amo.mts applied in tne order in paragraph 3, and then to prepayment
<br /> of princinal, ar (b) to the rescocation or repair o� che damaged pronerty.�Any appiication of the praceeds ro the
<br /> principal shall not eztend or postpone the due date of the monthly payenenu which are refenM to in paragraph 2, or
<br /> change the annocn: of such payments. My ez��s insurance proceeds over an amount required to pay ali autstanding
<br /> indebtedness:uidc-the Note and this Ser.urity Instrument shall be paid to the rntity legally eatitleci thereto. '
<br /> In che event of forcclosure of this Security Insnvment or other cr°�nsfer of tir.le to the Property that extinguishes
<br /> the indeb�edness, all right, �ide and interest of Borrower �n and w insurance policies in force s6at1 pass to the
<br /> purchaser.
<br /> S. Occuganey, Ft-�ervatio�, Mainteaance and Protection of the Property; Borrower's Loan Application;
<br /> Leaseholds. Borrower shall c�ccupy, establish, and use �he Property a,s Bocrower's principa! residence within sizty
<br /> day� after th� eYecutioa of this S�curity Insttumer.t (or within sixty days o�a later sale or transfer of che Property) '
<br /> and shall continue to axupy the Pruperty as gorrower's principa! residence for at Ieast one year aher the date of
<br /> occupancy, unless 1_.ender d�ternunes that rcquiremtnt witl caase und�e hardship for B�rrawer, er unless exrenuating
<br /> circums�ances ezist which are 'txyond Borrower's contml. Borrower shali notify I.ender of any extenuating
<br /> circumscanas. Borrower shall not cariunit waste or destroy,damage or substantially c�angz the Property or�llow the '
<br /> Property to deteriorate, rea,onable wtar and tear ezcept�d. Lender may inspect the Proper,ry if the Property is vacant
<br /> - or abandoned or the loan is in default. Lr_r.der may take reasor.able action to protect �nd prese�ve such vacant or
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