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201102�72
<br />and sell the Property; and to take any action required of Lender including, but not lnnited to, releasing or canceling
<br />this Security Instrument.
<br />BORROLVER COVENANTS that Borrower is lawfully seised of the estate hereby conveyed and has the right to
<br />grant and convey the Property and that the Property is uncncumbered, except for encumbrances of record. Borrower
<br />warrants and will defend generally the title to the Property against all ciaixns and demands, subject to any
<br />encumbrances of record.
<br />THIS SECURITY INSTRLJMENT combines uniform covenants for national use and non-uniform covenants with
<br />limited vaziations by jurisdiction to constitute a uniform security instrument covering real property.
<br />UNIFORM COVETIANTS. Borrower and Lender covenant and agree as follows:
<br />1. Payment of Principal, Interest and Late Charge. Borrower shall pay when due the principal of, and
<br />interest on, the debt evidenced by the Note and late charges due under the Note.
<br />2. Monthly Payment of Taxes, Insurance, and Other Charges. Borrower shall include in each monthly
<br />payment, together with the principal and interest as set forth in the Note and any late charges, a sum for (a) taxes and
<br />special assessments levied or to be levied against the Property, (b) leasehold payments or ground rents on the
<br />Property, and (c) premiums for insurance required under pazagraph 4. In any year in which the Lender must pay a
<br />mortgage insarance premium to the Secretary of Housing and Urban Development (" Secretary"), or in any yeaz in
<br />which such premium wouid have been required if Lender still held the Security Instrument, each monthly payment
<br />shall also include either: (i) a sum for the annual mortgage insurance premium to be paid by Lender to the Secretary,
<br />or (ii) a monthly charge instead of a mortgage insurance premium if this Security Instrument is held by the Secretary,
<br />in a reasonable amount to be determined by the Secretazy. Except for the monthiy charge by the Secretary, khese items
<br />are called "Escrow Items" and the sums paid to Lender aze called "Escrow Funds."
<br />Lender xnay, at any time, collect and hold amounts for Escrow Items 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 Procedwes
<br />Act of 1974, 12 U. S.C. §2601 et sea. and implementing regulations, 24 CFR Part 3500, as they may be amended
<br />from tune to time ("RESPA"), except that the cushion or reserve pernutted by RESPA for unanticipated disbursements
<br />or disbursements befote the Bonower's payments are available in the account may not be based on amounts due for
<br />the mortgage insurance premium.
<br />If the amounts held by Lender for Escrow Itexns exceed the amounts pernvtted to be held by RESPA, Lender shall
<br />account to Borrower for the excess funds as required by RESPA. If the amounts of funds held by Lender at any time
<br />are not sufficient to pay the Escrow Items when due, Lender may notify the Borrower and require Borrower to make
<br />up the shortage as permitted by RESPA.
<br />The Escrow Funds are pledged as additional securiry 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 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 />credited with any balance remaining for all installments for items (a), (b), and (c).
<br />3. Application of Payments. AIl payments under paragraphs 1 and 2 shall be applied by Lender as follows:
<br />FIRST, to the mortgage insurance pramium to be paid by Lender to the Secretary or to the monthly chazge by
<br />the Secretary instead of the monthly mortgage insurance premium;
<br />SECOND, to any taxes, special assessments, leasehold payments or ground rents, and fire, flood and other hazard
<br />insurance premiums, as required;
<br />THIRD to interest due under the Note;
<br />FOURTfI, to amortizarion of the principal of the Note; and
<br />FIFTA, to late charges due under the Note.
<br />4. Fire, F'lood and Other Hazard Insurance. Bonower shall insure all anprovements on the Property,
<br />whether now in existence or subsequently erected, against any hazards, casualries, and contiagencies, including fire,
<br />for which Lender requires insurance. Ttris insurance shall be maintained in the amounts and for the periods that
<br />Lender requires. Borrower shatl also insure a11 improvements on the Property, whether now in e�cistence or
<br />subsequently erected, against loss by floods to the extent required by the Secretary. All insurance shall be cazried with
<br />companiea approved by Lender. The insurance policies and any renewals shall be held by Lender and shall include
<br />loss payable clauses in favor of, and in a form acceptable to, Lender.
<br />In the event of loss, Borrower shall give Lender immediate norice by mail. Lender may make proof of loss if not
<br />made promptly by Borrower. Each insurance company concemed is hereby authorized and 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 may be applied by Lender, at its oprion, either (a) to the reduction of the indebtedness under the Note and
<br />this Security Instrument, first to any delinquent amounts applied in the order in pazagraph 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 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 Inshument 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 the
<br />indebtadnass, all right, title and interest of Borrower in and to insurance policies in force shall pass to the purchaser.
<br />5. Occupancy, Preservation, Maintenance and Protection of the Property; Borrower's Loan Application;
<br />Leaseholds. Borrower shall occupy, establish, and use the Property as Bonower's principal residence within sixty
<br />days after the execurion of this Security Instrument (or within sixty days of a later sale or transfer of the Property)
<br />Borrower Initials:
<br />TRUST - MERS
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