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20�f04720
<br />� Lender may, at any tzme, collect ar�d hold amounts for Escrow Items in an a�gregate amount not to exceed the
<br />�.> • maximum amount thal may be required for Borrower's escrow accaunt under the Rea1 Estate Settlement Procedures
<br />� Act of 1974, 12 U. S. C. Sectian 7_601 et seq. and implementing regulations, 2� CFR Part 3500, as they may be
<br />amended frorn time to time ("RESPA"), except that the cushion or reserve permitted by RESPA for unanticipaied
<br />disbursements or disbursements before the Borrower's payments are available in the acct�unt may not be based on
<br />amounts due for the mortgage insurance premium.
<br />If the amounts held by L,ender for Escrow Items exceed the amounts permitted tQ be held by RESPA, Lender
<br />shall accxwunt to Bc�rrower for the excess funds as required by RESPA. If the amounts of funds held by Lender at any
<br />timc are not svfficient to pay the Escrow Items when dae, Lendar may notify the Borrower and require Borrower to
<br />makc up the shartagc as permitted by RESPA.
<br />The Escrow Funds are pledgad as additional security for all sums securecl by this Security Instrument. If
<br />Borrawer tenders tv Lender the fuli payment qf ali such sums, Borrower's account shal.t be credited with the balance
<br />remaining for all installment items {a}, (1�), and (c) and any mortgage insurance premium installment that L.ender has
<br />not become abligated to pay to the Secretary, and Lender shall promptly refund any excess funds to Borrower.
<br />Immediately priar to a foreclosura sale of the Property or its acquisitian by Lender, Borrawer` s account shall be
<br />credited with any balance remaining for all installments for items (a), (b), and (c}.
<br />3. Application of Payments. .A1i payments undsr paragraphs 1 and � shall be applied by Lender as follows:
<br />�irst, to the mortgage insurance premium ta be paid by Lender to the Secretary or to the monihiy charge by the
<br />Secretary instead of the monthky mortgage insurance premium;
<br />Secand, to any taxes, sgecial assessments, leasehold payments or ground rents, and fire, flood and other hazard
<br />insurance premiums, as required;
<br />Third, tc� iaterest due under the Note;
<br />Fourth, to amorTization of the principal of the Note; and
<br />E'ifth, to late charges due under the Note.
<br />4. F;re, Fload and Other Hazard Insurance. Sorrower shatl insure all improvements on the Properly, whether
<br />now in existence ar subsequently erected, against any hazards, casualties, and wntingencies, including fire, for which
<br />I.ender reyuires insurance. This insurance shall be maintained in tha amounts and far the periods that Lender
<br />requires. Bcarrowcr shall aIso insure all improvements on the Property, whether now zn existence or subsequentlg�
<br />erected, against loss by floods to the extent required by the Secretary. All insurance shall be carried with companies
<br />approved by Lender. The insurance policies and any renewals shall be held by Lender and shall inciude ]oss payable
<br />� clauses in favor of, and in a form acceptable to, Lender.
<br />' In the event c�f loss, Borrower shall give Lender immediate notice by mail. Lender may make proof of loss it not
<br />�, made promptly by Iiorrower. Each insurance company rnncerned is hereby autharized and directed to make payment
<br />! for sach loss directly to Lender, instead of to Sorrower and to Lender jointly. All or any part of the insurance
<br />praceeds may t�e applied by Lender, at its option, either (a) to the reduction of the indebtedness under the Note and
<br />this Security Instrument, first co any delinquent amounts apglied 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 agglication of the proc�eds to the
<br />principal shalI n<�t extend or postpane the due date of the monthly payments which are referred to in paragraph 2, or
<br />change che amount ol such payments. Any excess insurance proceeds over an amouni required to pay all outstanding
<br />indet�tedness under the Note and this Secucity Instrument shall be paid [o the entiTy legally entetled theret�.
<br />In the event of foreclqsure af this Security Instrument or other transfer of title to the Praperty that extinguishes
<br />the indebtedne�.s, all right, title and interest of Borrower in and to insurance policies in force shall pass to the
<br />purchascr.
<br />5. Oceupancy, Preservation, Maintenance and Protection of the Property; Borcower's Loan Application;
<br />I.easeholds. Bc>rrower shall occupy, astablish, and use the Properfy a,a Borrower's principal residence within sixty
<br />days al'ter thc cxccution of this Security Instrument {or within sixty days of a later sale or transfer of the Property)
<br />and shall continuc to occupy the Praperty as Borrower's principal residence for at least one year after the date of
<br />occupancy, unless L.ender determines that requiremani will cause undue hardship for 13orrower, or uniess extenuating
<br />circumslanc:es exisl which are beyand Borrower's cc�ntrol. Borrower sk�all notify Ti,ender of any extenuating
<br />cireumstances. I3orrower shati not commit waste ar destroy, dammage or substantialiy change the Property or allow the
<br />Property to deteriorate, reasonable wear and teaz excepted. L.ender may inspect the Property if the Property is vacant
<br />or abandoned or the loan is in default. Lender may take reasonable actian to protect and preserve such vacant or
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