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201108354
<br />Lender may, at any time, collect and hold amounts for Escrow Items in an aggregate amount not to acc�ed the
<br />maximum aznount that may be required for Bonower' s escrow account under the Real Estate Settlement Proce�ures
<br />Act of 1974, 12 U. S. C. Section 2601 et seq. and implementing regulations, 24 CFR Part 3500, as they may be
<br />amended from time to time ("RESPA"), �cept 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 baseri on
<br />amounts due for the mortgage insurance premium.
<br />If the amounts held by Lender for Escrovv Items �ceed the amounts permitted to be held by RESPA, Le,nder
<br />shall account to Bonower for the excess fiznds 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 require Borrower to
<br />make up the shortage as permitted by RESPA.
<br />The Escrow Funds are pledged as additional 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 installment that Lender has
<br />not bec;ome obligated to pay to the Se�retary, and Lender shall promptly refund any excess funds to Borrower.
<br />Imme�iately 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. 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 charge 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, flood and other hazard
<br />insurance preiniums, as required;
<br />Third, to interest due under the Note;
<br />Fourth, to amortization of the principal of the Note; and
<br />F� to late charges due under the Note.
<br />4. I�re, Flood and Other Hazard Insurance, Borrower shall insure all improvements on the Property, whether
<br />now in existence or subsequently erected, against any hazards, casualties, and contingencies, including fire, for wluch
<br />Lender requires insurance. This insurance sha11 be maintained in the amounts and for the periods that Lender
<br />requires. Borrower shall also insure all improvements on the Property, whether now in existence or subsequently
<br />erected, against loss by floods to the e�ctent required by the Secretary. All insurance shall be carried with comPar►ies
<br />approved by L�der. The insurance policies and any renewals shall be held by Lender and shall 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 norice by mail. Lender may make proof of loss if not
<br />made promptly by Borrower. Each insurance company concerned is hereby authorized and dire�te� to make payment
<br />for 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 reduction of the indebtedness under the Note and
<br />this Security Instrument, first to any delinquent 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 tha
<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 require� to pay all outstanding
<br />indebtedness under the Note and this Se�urity Instrument shall be paid to the entity legally entitle� 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 Borrower in and to insurance policies in force shall pass to the
<br />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 Borrower' s principal residence within sixty
<br />days a,fter the �ecution of this Security Instrument (or within sucty days of a later sale or transfer of the Property)
<br />and shall continue to occupy the Property as Borrower' s principal residence for at least one year after the date of
<br />occupancy, unless Lender determines that re�uirement will cause undue hardship for Borrower, or unless eYtenuating
<br />circumstances e�cist which are beyond Borrower' s control. Borrower shall notify Lender of any e�enuatin8
<br />circumstances. Bortower shall not commit waste or destroy, damage or substantially change the Property or allow the
<br />Property to deteriorate, reasonable wear and tear excepted. Lender may inspect the Properiy if the Property is vacant
<br />or abandoned or the loan is in default. Lender may take reasonable action to protect and preserve such vacant or
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