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201�09350
<br />If the amounts hcld by L.ender for Escrow Items exceed lh� amounts perrnitted to be held by RESPA, Lender
<br />shall account to Borrower far khe excess funds as required by RESPA. If khe amounts of funds held by L�nder at any
<br />time are not sufficient tc� pay the Escrow Items when due, T,end�r rnay notify the Borrower and r�yuire Borrower to
<br />make up the shortage as permitt�d by RESPA.
<br />�lfie Escrow I'unds are pledged as additional security far all sums secured by this S�curity Instrument. If
<br />Borrower tenders to LendCr the full payment of all such sums, Barrow�r's account shall be credited with thc balanc�
<br />remaining for all installment items (a), (b), and (c) and any martgage insurance premium installm�nt that I.,ender has
<br />not become abligat�d to pay to the Secretary, and L.ender shall promptly refund any CXGC55 funds to Borrower.
<br />Tmmediately prior to a foreclosure sale of the Praperty or its acquisition by Lc:nde;r, BDtTPW�T account shall be
<br />Gredited with any balance rc:maining for all installments for items (a), (b), and (c).
<br />3. Application of Payments, All payments under paragraphs 1 and 2 shall be applied by Lender as fcallc�ws:
<br />First, to th� mc7rtgage insurance premium to bc paid by I,ender to the Secretary or to the manthly charge by the
<br />Secretary instead of th� monthly mortgage insurance pr�mium;
<br />Second, to any taxss, special assessments, leas�hold payXnents or ground rents, and fire, flaod and ather hazard
<br />insurance premiums, as required;
<br />'1`hird to interest due under the Note;
<br />Fourth, t� amartic�alion of the principal of the Note; and
<br />Fifth, to latc charges due under the Note.
<br />4. Fir�, Flood and Other Hazard Insuranee. Borrower shall insure all improvcm�nts an the Praperty, whether
<br />now in existence or subsequently erccted, against any hazards, casualties, and contingcncies, including fire, for which
<br />Ixnder requires insurance. This insurance shall be maintained in the amounts and far the periods that L.ender
<br />requires. Borrower shall also insurc all iamprovements on the Property, whether now in c:xistence Ur subsequently
<br />crccted, against loss by tloods to the ex[ent required by the Secretary. All insurance shall be canried with carr�panies
<br />apprav�d by I.ender. The insurance polici�s and any renewals shall be held by Lender and shall includ� lass payable
<br />clauses in favor of, and in a form accep[ak�le ta, I,ender.
<br />In the event of loss, Borrower shall give Lender irnmediate notice by mail. Lcnder may make proof of loss if not
<br />made promptly by Borrower. I:ach insurance company concerned is hereby authorized and directed ta rnake payment
<br />for such loss directly to I.,ender, instead of to Borrower and to I.ender jainlly. All or any part of the insurance
<br />proceeds may be applied by Lender, at its option, either (a) to the reduction af the indebtedness under the Note and
<br />this Security Ins[rum�nt, first to any delinquent amounts applicd in thG arder in paragraph 3, and then to prepayment
<br />of principal, ar (b) ta the restoration or repair of the damaged Property. Any application of the proceeds to the
<br />principal shall not extend or postpone the due dat� c�f the manthly payments which are referred to in paragraph 2, or
<br />chang� [h� amount of such payments. Any excess insurance proceeds over an amount required to pay all outstanding
<br />indebt�:dn�sa under the Note and this Security Instrument shall be paid to the entity legally entitled thereto.
<br />ln the event of foreclasure of this Security Tnstrument or other transfer of titls ta ths Property that extinguishes
<br />the indebtedness, all right, title and interest of T3orrower in and to insurance policies in force shall pass to the
<br />purchaser.
<br />5. Occupancy, Preservation, Maintenance and 1'rotection of the Property; Borrower's Loan Application;
<br />Leaseholds. Borrower shall Ucc:upy, sstablish, and use the Property as Borrower"s principal residencc wilhin sixty
<br />days after the execution of lhis Security Instrument (or within sixty days of a later sale or transfer of the Property)
<br />and shall continue to occupy th� Praperty as Barrawer's principal residence for at least one year after the date of
<br />occupancy, unless Lender determines that rec�uirernent will cause undue hardship for Borrower, or unless extenuating
<br />circurtxstances exist which are beyond Borrower's contral. Barrawear shall notify Lender of any extenuating
<br />circumstances. Borrower shall not cammif wast� �r destroy, damage or substantially change the Property or allow the
<br />Property to deteriorate, reasonablc wear and tear exceptsd. J.,ender may inspect the Property if the Property is vacant
<br />or abandoned or the loan is in d�fault. Lender rnay take reasonable action to protect and preserve such vacant or
<br />� 4RINE) �ssoy� Paqe 3 of 8 inieiais:�
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