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�01106059
<br />Lender may, at any time, collect and hold amounts for Escrow Items in an aggregate amount not to exc�eci the
<br />maximum amount that may be require� for Borrower' s escrow ac�ount under the Real Estate Settlement Procedures
<br />Act of 1974, 12 U.5.C. Se�rion 2601 et seq. and implementing regulations, 24 CFR Pazt 350Q as they may be
<br />amended from time to time ("RESPA"), except that the cushion or reserve permitted by RESPA for tmanticipated.
<br />disbursements or disbursements before the Borrower's payments are available in the aabunt may not be based on
<br />amounts due for the mortgage insurance premium.
<br />If the amounts held by Lender far 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 fuads held by Lender at any
<br />time are not sufficient to pay the Escrow Items when due, Lender may notify the Borrower and re�uire Borrower to
<br />make up the shortage as permitted by RESPA.
<br />The Escrow Fwids are pledged as additional security for all sums secureri by tUis Se�urity Instmm�ent If
<br />Borrower tenders to Lender the full payment of all such sums, Borrower's account shall be credited with the balence
<br />remaining for all installment items (a), (b), and (c) and any mortgage insurance premium insta,llment that Lender bas
<br />not be�ome obligated to pay to the Se�retary, and Lender shall pramptly refimd any excess funds to Boaower.
<br />Immediately prior to a for�losure sale of the Properiy or its acquisitian 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. All payments under paragraphs 1 and 2 shall be applied by Lender as follows:
<br />Firs to the mortgage insurance premium to be paid by Lender to the Secretary or to the monthly chazge by the
<br />Secxetary instead of the monthly mortgage insurance premium;
<br />S�on to any taxes, special ass�ts, leasehold payments or ground rents, and fire, flood and other ha�ard
<br />insurance premiums, as required;
<br />� to interest due under the Note;
<br />Four to amortization of the principat of the Note; and
<br />F� ta late chazges due under the Note.
<br />4. Fire, Flood and Other Hazard Insarance. Borrower shall insure all improvements on the Property, whether
<br />now in existence or subsequently ec'ected, against any hazards, casualties, and contingencies, including fire, for which
<br />I.ender requires insurance. This insurance shall be maintained in the amounts and for the periods tl�t Lender
<br />requires. Boirower shall also insure all improvements on the Progerty, whether now in e�cistence or subsequmtly
<br />erected, against loss by floods to the extent re�uirefl by the Se,cretary. All insurance sha11 be carried with campanies
<br />approved by Lender. The insurance policies and any renewals shall be held by Lender and shall include loss payable
<br />clauses in favor o� 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 promptly by Borrower. Each insuraace company concerned is hereby authorized and directefl to make payment
<br />far such loss dire�tly 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 option, either (a) to the re�iuction of the indebtedness under the Note and
<br />this Security Instrument, first to any delinquent amounts applie� 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 proc�eds to the
<br />principal shall not extend or postpone the due date of the monthly payments w}uch are refened to in paragraph 2, or
<br />c�nge the amount of such payments. Any exce9s insurance proceeds over an amount requirerl to pay all ou�tstanding
<br />indebtedness under the Note and this Sec�mty Instrument shall be paid to the entity legally entitled thereto.
<br />In the eve�t 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 Borrower in and to insiu�ance policies in force sha11 pass to the
<br />purchaser.
<br />5. Occnpancy, Preserval3on, Maintenance and Protection of the Property; Borrower's Loan Applicadon;
<br />Leaseholds. Borrower sha11 occupy, establish, and use the Property as Borrower's principal residence within sixty
<br />days after the execution of this Se�urity Instrument (or within sixty days of a later sale or transfer of the Property)
<br />and shall continue to occupy the Property as Borrower' s principal residence far at least one ye,ar after the date of
<br />occupancy, unless Lender detezmines that requirement will cause undue hazdship for Bonowe�, or unless e,xtenuating
<br />circwnstance.s axist which are beyond Borrower's control. Bonower shall notify Lender of any extenuating
<br />circumstance,s. Bosower shall not commit waste or desdroy, daznage or substantially change the Property or allow the
<br />Property to deteriorate, reasonable we,ar and te,ar excepted. Lender may inspect the Property if the Properiy is vacant
<br />ar abandoned or the loan is in defaul� Lender may talce reasonable action to prote,ct and preserve such vacant or
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