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201002493
<br />If the amounts held by Lender for Escrow items exceed the amounts perrrzitted to be held by RESPA, Lender
<br />shall account to Borrower for the excess funds as required by RESPA. If the amounts of funds held by Lender at any
<br />time are not sufficient to pay the Escrow Items when due, Lender may notify the Borrower and require Borrower to
<br />make up the shortage as permitted by RESPA.
<br />The Escrow Funds are pledged as additional security for all sums secured by this Security Instrument. If
<br />Borrower tenders to Lender the full payment of all such sums, Borrower's account shakl be credited with the balance
<br />remaining for all instal]llzelzt items (a), (b), and (c) and any mortgage insurance premium installment that Lender has
<br />not become obligated to pay to the Secretary, and Lender shall promptly refund any excess funds to Borrower.
<br />Immediately prior to a foreclosure sale of the Property or its acquisition by Lender, Borrower's account shall be
<br />Credlted Wltll ally balaIlce remalIllIlg for all lilStillltnents for Items (a), (b), aIld (C).
<br />3. Application of Payments. All payments under paragraphs 1 and 2 shall he applied by Lender as follows:
<br />First, to the mortgage ilzsuralzce premium to he paid by Lender to the Secretary or to the monthly charge by the
<br />Secretary instead. of the monthly mortgage insurance premium;
<br />Second, to any taxes, special assessmelzts, leasehold payments or ground rents, and tire, flood and other hazard
<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 shall ilzsure all improvements on the Property, whether
<br />now in existence or subsequently erected, against any hazards, casualties, and contingencies, including fire, for which
<br />Lender requires ilsurance. This insurance shall be maintained in the amounts and for the periods that Lender
<br />requires. Borrower shall also insure all improvements on the Property, whether now in existence or subsequently
<br />erected, agailzst loss by floods to the extent required by the Secretary. All ilsurance shall be carried with compazzies
<br />approved by Lender. The insurance policies and any renewals shall be held by Lender and shall include loss payable
<br />clauses in favor of, and in a form acceptable to, Lender.
<br />In the event of loss, Borrower shall give Lender izmnediate notice by Inail. Lender may make proof of loss if not
<br />rtlade promptly by Borrower. Each insurance company concerned is hereby authorized azld directed to make payment
<br />for such loss directly to Lender, instead of to Borrower and to Lender jointly. All. or any part of the insurance
<br />proceeds nzay he applied by Lender, at its option, either (a) to the reduction of the indebtedness under the Note anal
<br />this Security Instrument, first to any delinquent amounts applied in the order in paragraph 3, and then to prepayment
<br />of principal, or (b) to the restoration or repair of the damaged Property. Any application of the proceeds to the
<br />principal shall not extend or postpone dze due date of the monthly payments which are referred to in paragraph 2, or
<br />change the amount of such payments. Any excess insurance proceeds over an amount required to pay all outstanding
<br />indebtedness under the Note and this Security Instrument shall be paid to the entity legally entitled thereto.
<br />In the event of foreclosure of this Security Instrument or other transfer of title to the Property that extinguishes
<br />the indebtedness, all right, title and interest of Borrower in and to ilLSUrance policies in force shall pass to the
<br />purchaser.
<br />5. Occupancy, Preservation, Maintenance and Protection of the Property; Borrower's Loan Application;
<br />Leaseholds. Borrower sklall occupy, establish, and use the Property as Borrower's principal residence withizl sixty
<br />days after the execution of this Security .Instrument (or within sixty days of a later sale or transfer of the Property)
<br />and shall continue to occupy the Property as Borrower's principal residence for at least one year after the date of
<br />occupancy, unless Lender deterrzzines that requirement will cause undue hardship for Borrower, or ulzless extenuating
<br />circumstances exist which are beyond Borrower's control. Borrower shall notify Lender of any extenuating
<br />circumstances. Borrower shall not comrrlit waste or destroy, damage or substantially change the Property or allow the
<br />Property to deteriorate, reasolable wear and tear excepted. Lender may inspect the Property if the Property .is vacant
<br />or abandoned or dze loan is in default. Lender may take reasonable action to protect and preserve such vacazit or
<br />~~4RINE) (gso11
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