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200605645 4 (I) If and so long as said Note of even date and this instrument are insured or are reinsured under the provisions of the National Housing Act, an amount sufficient to accumulate in the hands of the Mortgagee one month prior to its due date the amount mortgage insurance premium, in order to provide such Mortgagee with funds to pay such premium so the Federal Housing Commissioner pursuant to the National Housing Act, as amended, and applicable Regulation thereunder, or (II) If and so said Note of even date and this instrument are held by the Secretary of Housing and Urban Development, a monthly service charge in an amount equal to 1/12 of 1/2% of the average outstanding principal balance due on the Note computed for each successive year beginning with the first day of the month following the date of this instrument, if the Secretary of Housing and Urban Development is the Mortgagee (Beneficiary) named herein, or the first day of the month following assignment, if the Note and this instrument are assigned to the Secretary of Housing and Urban Development, without taking into account delinquencies or prepayment. b. A sum equal to the ground rents, if any, next due, plus the premiums that will next become due and payable on policies of fire and other insurance covering the premises covered hereby, plus water rates, taxes and assessments next due on the premises covered hereby (all as estimated by the Mortgagee) less all sums already paid therefore divided by the number of months to elapse before one month prior to the date when such ground rents, premiums, water rates, taxes and assessments will become delinquent, such sums to be held by Mortgagee in trust to pay said ground rents, premiums, water rates, taxes and special assessments. c. All payments mentioned in the two preceding subsections of this paragraph and all payments to be made under the Note secured hereby shall be added together and the aggregate amount thereof shall be paid each month in a single payment to be applied by Mortgagee to the following items in the order set forth: (I) premises charges under the Contract of Insurance with the Secretary of Housing and Urban Development, acting by and through the Federal Housing Commissioner or service charge; (II) ground rents, taxes, special assessments, water rates, fire and other insurance premiums; (III) interest on the Note secured hereby; (IV) amortization of the principal of said Note; 10. In the event the Mortgagor fails to pay any sums provided for in this Mortgage, the Mortgagee, at its option, may pay the same. Any excess funds accumulated under b. of the preceding paragraph remaining after payment of the items therein mentioned, shall be credited to subsequent monthly payments of the same nature required thereunder; but if any such item shall exceed the estimate therefor, or if the Mortgagor shall fail to pay any other governmental or municipal charge, the Mortgagor shall forthwith make good the deficiency or pay the charge before the same becomes delinquent or subject to interest or penalties and in default thereof the Mortgagee may pay the same. All sums paid by the Mortgagee and nay sums which the Mortgagee may be required to advance to pay mortgage insurance premiums shall be added to eh principal ofthe debt secured hereby and shall bear interest from the date of payment at the rate specified in the Note and shall be due and payable on demand. In case of termination of the contract of Mortgage Insurance by prepayment other Mortgage in full, or otherwise (except as hereinafter provided), accumulations under (a) of the preceding paragraph hereof not required to meet payment due under the Contract of Mortgage Insurance, shall be credited to the Mortgagor. If the property is sold under foreclosure or is otherwise acquired by the Mortgagee after the default, any remaining balance of the accumulations under (b) of proceedings or as of the date the property is Rental - Rider to Mort Restr Mtg 09-15-04