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99 111516
<br /> Lender may, at any time, collect and hold amounts for Escrow Items in an aggregate amount not to exceed the mexknum
<br /> amount that may be required for Borrower's escrow account under the Real Estate Settlement Procedures Act of 1974, 12 U.S.C.
<br /> � § 2601 et sea• and implementing regulations, 24 CFR Part 3500, as they may be amended irom time to time ("RESPA"), eoccept
<br /> that the cushion or reseroe permitted by RESPA for unanticipated disbursements or disbursements before the Borrower's
<br /> payments are available in the account may not be based on amounts due for the mortgage insurance premium.
<br /> If the amounts held by Lender for Escrow Items e�cceed the amounts pertnitted to be held by RESPA, Lender shall account
<br /> to Borrower for the excess funds as required by RESPA. If the amounts of funds held by Lender at any time are not sufficient to
<br /> pay the Escrow Items when due, Lender may notity the Borrower and require Borrower to make up the shortage as permitted by
<br /> RESPA.
<br /> The Escrow Funds are pledged as additanal security for all sums secured by this Security Instrurnent. If Borrower tenders
<br /> to Lender the full paym�t of ail such sums, Borrowe�s account shall be credited with the balance rernaining for all instelNnent
<br /> kems (a), (b), and (c) and any mortgage insurance premium instalknent that Lender has not become oblipated to pay to the
<br /> Secretary, and Lender shall promptly refund any excess funds to Borrower. Immediatey prior to a forecbsure sale of the Property
<br /> or its acquisition by Lender, Borrower's account shall be cred'Red with any balance remaining for all instalknents for items (a), (b),
<br /> and (c).
<br /> 3. Application of Payments. All payments under Peregrephs 1 and 2 shall be applied by Lender as folbws:
<br /> FIfBt, to the mortgage insurance premium to be paid by Lender to the Secretary or to the monthy charge by the Secretary
<br /> instead of the monthy mortgage insurance premium;
<br /> Second, to any taxes, special assessments, leasehoid payments or ground rents, and fire, flood and other hezard
<br /> insurance premiums, as required;
<br /> Third, to interest due under the Note;
<br /> Fourth, to amortization of the principal of the Note; and
<br /> Fifth, to late charges due under the Note.
<br /> 4. Fire, Flood and Other Hazard Insurance. Borrower snau insure all improvements on the Property, wne�her
<br /> now in existence or subsequenty �ected, against any hezards, casuafties, and contingencies, including fire, for which Lender
<br /> requkes insurance. This insurance shail be maintained in the amounts and for the p�iods that Lender requires. Borrower shall
<br /> also insure all improvements on the Property, whether now in existence or subsequently erected, against bss by fbods to the
<br /> extent required by the Secretary. All insurance shall be carried wkh companies approved by Lender. The insurance policies and
<br /> any renewals shall be held by Lender and shall inctude bss 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 bss if not made
<br /> prompty by Borrower. Each insurance company concemed is hereby authorized and directed to make payment for such bss
<br /> directly to Lender, instead of to Borrower and to Lender Jointy. 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, f'rst to any
<br /> delinquent amounts applied in the order in Paragraph 3, and then to prepeyment of principal, or (b) to the restoration or repair of
<br /> the damaged Property. My application of the proceeds to the principal shall not extend or postpone the due dete of the
<br /> monthty payments which are referred to in Paragraph 2, or change the amount of such payments. My eoccess insurance
<br /> proceeds over an amount required to pay all outstanding indebtedness under the Note and this Security Instrument shall be paid
<br /> to the entity legaly �titled 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, titls and interest of Borrower � and to insurence policies in force shali pass to the purchaser.
<br /> 5. Occupancy, Preservation, Maintenance and Protection of ihe Property; Borrower's Loan
<br /> AppIlC8tl0�; Leaseholds. Borrower shall occupy, establ�h, and use the Property as Borrower's principal residence wkhin
<br /> sbcty days after the execution of this Security Instrument (or within sbcty days of a later sale or transfer of the Property) and shall
<br /> continue to occupy the Property as Borrower's principal residence for at least one year aRer the date of occupancy, unless
<br /> Lender detem�ines that requirement will cause undue hardship for Borrower, or unless extenuating circumstances eocist which are
<br /> beyond Borrower's control. Borrower shall notiFy Lender of any extenuating circumstances. Borrower shall not commit waste or
<br /> destroy, damage or substantialy change the Property or allow the Property to deteriorate, reasonable wear and tear excepted.
<br /> Lender may inspect the Property ff the Property is vacant or abandoned or the ban is in defauR. Lender may take reasonable
<br /> action to protect and preserve such vacant or abandoned Property. Borrower shall also be in defauk if Borrower, during the ban
<br /> application process, gave materially false or inaccurate information or statements to l�der (or failed to provide Lender with any
<br /> material information) in connection wkh the loan widenced by the Note, includ'ng, but not limited to, representations conceming
<br /> Bonower's occupancy of the Property as a principal residence. If this Security Instrument is on a leasehold, Borrower shall
<br /> comply with the provisions of the lease. If Borrower acquires fee title to the Property, the leasehoid and fee titie shall not be
<br /> 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 wkh 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 r�nains unpaid under the Note and this
<br /> Securiry Instrument. Lender shall eppy such proceeds to the reduction of the indebtedness under the Note and this Security
<br /> Instrument, first to any delinquent amounts applied 'm the order provided in Paragraph 3, and then to prepayment of principal.
<br /> My application of the proceeds to the principal shall not extend or postpone the due date of the monthy payments, wh�h are
<br /> referred to in Paragraph 2, or change the amount of such payments. My 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 legaly entitled thereto.
<br /> 7. Charges to Borrower and Protection of Lender's Rights in the Property. BoROwer shall pay au
<br /> govemmental or municipal charges, fines and imposkions that are not included in Paragraph 2. Borrower shall pay these
<br /> obligations on time directy to the entiry which is owed the payment. If failure to pay would adversely affect Lender's interest in
<br /> the Property, upon Lenders request Borrower shall promptly fumish 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 egreements contained in this Security Instrument, or there is a legel proceeding that may significantly effect Lender's riphts in
<br /> the Property (such as a proceeding in bankruptcy, for cond�nnation or to enforce Isws 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 texes,
<br /> hazard insurance and other items mentioned in Paragraph 2.
<br /> F5813.LM0 (2/B9) Paps 2 of 5
<br /> 1171
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