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201100699
<br />Lender may, at any time, collect and hold amounts for Escrow Ttems in an aggregate amount not to exceed the
<br />maximum amount that may be required for Borrower` s escrow account under the Real Estate Settlement Procedures
<br />Act of I974, 12 U.S.C. Section 2601 et seq. and imptementing reguiations, 24 CFR Part 350U, as they may be
<br />amended from time to time ("RESPA"), except that the cushion or reserve permitted by RESPA for unanticipated
<br />disbursements or disbursements before the Borrower` s payments are available in the account may not be based on
<br />amounts due for the mortgage insurance premium.
<br />If the amounts held by Lender for Escrow Items exceed the amounts permitted 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 requ�re Borrower to
<br />make up the shortage as permitted by RESPA.
<br />The Escrow Funds are pledged as additionaE 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 shall be credited with the balance
<br />remaining for all installment items (a), (b), and (c) and any mortgage insurance premium mstallment that Lender has
<br />nat 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 T.ender, Borrower` s account shall be
<br />credi#ed with any balance remaining for all installments for items (a), {b), and (c).
<br />3. Application of Payments. All payments under paragraphs � and 2 shall be applied by Lender as follows:
<br />First, to the mortgage msurance premium to be paid by Lender to the Secretary or to the monthly charge by the
<br />Secretary instead of the monthly morCgage insurance premium;
<br />Second, to any ta�ces, spec�al assessments, leasehold payments or ground rents, and fire, flood and other hazard
<br />insurance premiums, as reGuired;
<br />Third, to interest due under the Note;
<br />Fourth, to amortization of the principal of the Note; and
<br />Fifth, to late chazges due under the Note.
<br />4. Fire, Flood and Other Hazard Insnrance. Borrower shall insure ali improvements on the Property, whether
<br />now in existence or subsequently erected, against any hazards, casualties, and contmgencies, including fire, for which
<br />Lender requires insura�ice. This insurance shall be maintained in the amounts and for the periods that Lender
<br />requires. Borrower shall aiso insure all improvements on the Property, whether now in existence or subsequently
<br />erected, against loss by floods to the extent requued by fhe Secretary. All insurance shall be cazried with companies
<br />approved by Lender. The msurance policies and any renewats shall be held by Lender and sha(t 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 immediate notice by mail. Lender may make proof of loss if not
<br />made promptfy by Borrower. Each insurance company concerned is hereby author►zed and direc#ed to make payment
<br />far such loss directly to Lender, instead of to Borrower and to Lender jointty. AI1 or any part of the insurance
<br />proceeds may be applied by Lender, at its option, either (a) to the reduckion of the indebtedness under the Note and
<br />this SecuriYy Instrument, first to any delinquent amounts applied in the order in paragraph 3, and then to prepayment
<br />of principak, or (b) to the restoration or repair of the damaged Property. Any application of the proceeds to the
<br />principal shali not extend or postpone the 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 Borrawer in and to insurance policies in force shall pass to the
<br />purchaser.
<br />5. Occupancy, Yreservation, Maintenance and T'rotection of the Property; Barrower`s Loan Application;
<br />Leaseholds. Borrower sha11 occupy, establish, and use the Property as Borrower` s princ�pal residence within 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 Froperty as Borrower` s principal residence for at teast one year after the date of
<br />occupancy, unless Lender determmes that requirement will cxuse undue hardship for Borrower, or unless extenuating
<br />circutnstances exist which are beyond Borrower` s control. Borrower shall notify Lersder of any extenuating
<br />circumstances. Borrower shali not commit waste or destroy, damage or substantially change the Property or allow the
<br />Pronerty to deteriorate, reasonable wear and tear excepted. Lender may �nspect the Property if the Property is vacant
<br />or abandoned or the loan is in default. Lender may take reasonable actFOn to protect and preserve such vacant or
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