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201101523
<br />Lender may, at any time, collec[ and hold amounts for Escraw Items in an aggregate amoun� not to exceed the
<br />maximum amount that may be required for Borrower's escrow account under the Real �state Settlement Procedures
<br />Act of 1974, 12 U.S.C. Section 26Q1 et seg. and implementing regulations, 24 CFR Part 3�00, as they may be
<br />amended from time to time ("RESPA"), exeept [hat the cushion or reserve permitted by RESPA for unanticipated
<br />disbursements or disbursements before the Borrower's payments are availabie in rhe account may not be based an
<br />amounts due for the mort�age insurance premium.
<br />If the amounts held by Lender for Escrow Itezns 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 fands hetd by Lender at any
<br />time are not sufficient to pay the Escrow Iterns when due, Lender may notify the Borrower and require Borrowez to
<br />make up the shorta�e as permitted by RESPA.
<br />The Escrow Funds are pledged as additional security for alI sums secured by this Security Instrument. If
<br />Borrower tenders to Lender the full payment of all sueh suzns, Borrower's account shall be czedited with the balance
<br />remaining for ail installment items (a), (b), and (c} and any mongaDe insurance prezriium installment that Lender has
<br />not became obli�ated to Pay co the Secretary, and Lender shall promptiy refund any excess funds to Borrower.
<br />Immediately prior to a foreclosure sale of the Property or its acquisition by Lender, Barrower's account shall be
<br />credited with any balance remaininL for all installments for items (a), (b), and {c}.
<br />3. Application of Payments. All payments under parabraphs 1 and 2 shall be applied by Lender as follows:
<br />First, to the mortgage insurance premium to be paid by Lender to the Secretary or to the znonthly chazge by the
<br />Secretary instead of the monthly mortgage insurance premium;
<br />Second, to any taxes, special assessments, leasehold payments or ground rents, and fire, tload and oEher hazard
<br />insurance premiums, as required;
<br />Third, to interest due under the Nate;
<br />Fourth, to amortization of the principal of the Note; and
<br />Fift , to late charges due under the Note.
<br />4. Fire, Flood and Other Hazard Insurance. Borrower shalt insure 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 insurance. This insarance shall be maintained in the amounts and 1'or the periods that Lender
<br />requires. $orrower shall also insure all improvements on [he Properiy, whether now in existence or subsequently
<br />erected, againsT loss by floods to the exient required by the Secretary. All insurance shall be earried with companies
<br />approved by Lender. The insurance policies and any renewals shai] be held by Lender and shall include loss payable
<br />clauses in favor of and in a forzn acceptable to, Lender.
<br />In the event oti loss, Borrower shall give Lender immediate notice by mail. Lender may rriake proof of loss if not
<br />made promptly by Borrower. Each insurance company concercied is hereby authorized and directed to make payment
<br />for such loss directly to Lender, instead of to Borrower and to Lender jvintly. Ali or any part of the insurance
<br />proceeds may be app3ied by Lender, at its option, either (a) to the reduction of the indebtedness under the Note and
<br />this Security Instrament, first to any delinyuent 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 the due date of the monihly payments which are referred tn in paragraph 2, or
<br />change the amount of such paymenGS. Any excess insurance proceeds over an amount required to pay all outstanding
<br />indebtedness undec the Nate and this Security Instrnment shaii be paid [o the entity IegaEiy 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, aIl right, title and interest of Borrower in and to insurance policies in fozce shall pass to the
<br />purchaser.
<br />5. Occupancy, Presexvation, Maintenance and Proteetion of the Propert,y; Borrower's Loan a,pplication;
<br />Leaseholds. Borrower shall occupy, establish, and use the Property as Borrower's principal residence within szxty
<br />days after the execution of this Security Instrument (or within sixty days of a later sale or [ransfer of the Property)
<br />aad shall corttinue To occupy the Property as Borrower's principal residence for at ieast one year after the date of
<br />occupancy, unless I..ender determines that requirement will cause undue hardship for Borrower, or unless extenuating
<br />circumstances exist which are beyond Borrowez's control. Borrower shall notify Lender ot any extenuating
<br />circumstances. Borrower shall not cornmit waste or destroy, damage oz' substantially change the ProperTy or allow the
<br />Property to deteriorate, reasonable wear and tear excepted. Lender may inspect the Property if the Property is vacant
<br />or abandoned or the loan is in detault. Lender may take reasonable action to protect and preserve such vacant or
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