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20040082"
<br />CASE #: NE3212335781729 DOC ID #: 0004903231501004
<br />required by the Secretary. All insurance shall be carried with companies approved by Lender. The insurance policies and any
<br />renewals shall 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
<br />promptly by Borrower. Each insurance company concerned is hereby authorized and directed to make payment for such loss
<br />directly to Lender, instead of to Borrower and to Lender jointly. All or any part of the insurance proceeds may be applied by
<br />Lender, at its option, either (a) to the reduction of the indebtedness under the Note and this Security Instrument, first to any
<br />delinquent amounts applied in the order in paragraph 3, and then to prepayment of principal, or (b) to the restoration or repair of
<br />the damaged Property. Any application of the proceeds 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
<br />legally entitled thereto.
<br />In the event of foreclosure of this Security Instrument or other transfer of title to the Property that extinguishes the
<br />indebtedness, all right, title and interest of Borrower in and to insurance policies in force shall pass to the purchaser.
<br />5. Occupancy, Preservation, Maintenance and Protection of the Property; Borrower's Loan Application;
<br />Leaseholds. Borrower shall occupy, establish, and use the Property as Borrower's principal residence within sixty days after the
<br />execution of this Security Instrument (or within sixty days of a later sale or transfer of the Property) and shall continue to
<br />occupy the Property as Borrower's principal residence for at least one year after the date of occupancy, unless Lender determines
<br />that requirement will cause undue hardship for Borrower, or unless extenuating circumstances exist which are beyond
<br />Borrower's control. Borrower shall notify Lender of any extenuating circumstances. Borrower shall not commit waste or
<br />destroy, damage or substantially change the Property or allow the Property to deteriorate, reasonable wear and tear excepted.
<br />Lender may inspect the Property if the Property is vacant or abandoned or the loan is in default. Lender may take reasonable
<br />action to protect and preserve such vacant or abandoned Property. Borrower shall also be in default if Borrower, during the loan
<br />application process, gave materially false or inaccurate information or statements to Lender (or failed to provide Lender with
<br />any material information) in connection with the loan evidenced by the Note, including, but not limited to, representations
<br />concerning Borrower's occupancy of the Property as a principal residence. If this Security Instrument is on a leasehold,
<br />Borrower shall comply with the provisions of the lease. If Borrower acquires fee title to the Property, the leasehold and fee title
<br />shall not be 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 connection with any
<br />condemnation or other taking of any part of the Property, or for conveyance in place of condemnation, are hereby assigned and
<br />shall be paid to Lender to the extent of the full amount of the indebtedness that remains unpaid under the Note and this Security
<br />Instrument. Lender shall apply such proceeds to the reduction of the indebtedness under the Note and this Security Instrument,
<br />first to any delinquent amounts applied in the order provided in paragraph 3, and then to prepayment of principal. Any
<br />application of the proceeds to the principal shall not extend or postpone the due date of the monthly payments, which are
<br />referred to in paragraph 2, or change the amount of such payments. Any excess proceeds over an amount required to pay all
<br />outstanding indebtedness under the Note and this Security Instrument shall be paid to the entity legally entitled thereto.
<br />7. Charges to Borrower and Protection of Lender's Rights in the Property. Borrower shall pay all governmental or
<br />municipal charges, fines and impositions that are not included in paragraph 2. Borrower shall pay these obligations on time
<br />directly to the entity which is owed the payment. If failure to pay would adversely affect Lender's interest in the Property, upon
<br />Lender's request 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
<br />and agreements contained in this Security Instrument, or there is a legal proceeding that may significantly affect Lender's rights
<br />in the Property (such as a proceeding in bankruptcy, for condemnation or to enforce laws or regulations), then Lender may do
<br />and pay whatever is necessary to protect the value of the Property and Lender's rights in the Property, including payment of
<br />taxes, 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
<br />this 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 />Borrower shall promptly discharge any lien which has priority over this Security Instrument unless Borrower: (a) agrees in
<br />writing to the payment of the obligation secured by the lien in a manner acceptable to Lender•, (b) contests in good faith the lien
<br />by, or defends against enforcement of the lien in, legal proceedings which in the Lender's opinion operate to prevent the
<br />enforcement of the lien; or (c) secures from the holder of the lien an agreement satisfactory to Lender subordinating the lien to
<br />this Security Instrument. If Lender determines that any part of the Property is subject to a lien which may attain priority over
<br />this Security Instrument, Lender may give Borrower a notice identifying the lien. Borrower shall satisfy the lien or take one or
<br />more of the actions set forth above within 10 days of the giving of notice.
<br />8. Fees. Lender 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 payment defaults,
<br />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 Instrument prior to or
<br />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 contained in this
<br />Security Instrument.
<br />(b) Sale Without Credit Approval. Lender shall, if permitted by applicable law (including Section 341(d) of the
<br />Gam -St. Germain Depository Institutions Act of 1982, 12 U.S.C. 1701j -3(d)) and with the prior approval of the
<br />Secretary, require immediate payment in full of all sums secured by this Security Instrument if-
<br />(i) All or part of the Property, or a beneficial interest in a trust owning all or part of the Property, is sold or otherwise
<br />transferred (other than by devise or descent), and
<br />(ii) The Property is not occupied by the purchaser or grantee as his or her principal residence, or the purchaser or
<br />grantee does so occupy the Property but his or her credit has not been approved in accordance with the requirements
<br />of the Secretary.
<br />Initials: £
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