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RENEGOTIAHLE RATE RIDER
TBIS RENEGOTIAHI.h' RATE RIDER is made this 28TH day of
JANUARY , 19e1, and is incorporated into and s a 1 be
deeme~ to amend and supplement a iaortqaqe (herein "security
instrument") dated of even date herewith, qiven by the
undersiqned (herein "Borrower") to secure Borrower's Note to
Heritaqe Federal Savinqs and Loan Association (herein "Lender")
and coverinq the proper~y des~ ed s id t aq ~,d
located at lOT 8, TANNER Av~~~, P~T ~T. ~~1 ~, ~L(~RTnA ~
(property adc~ress) .
RENEGOTIABLE RATE COVENANTS. In addition to the covenants
and agreements made in the security instrument, Borrower and
Lender further covenant and agree as follows:
A. TERMS OF NOTE AND MORTGAGE. Borrower and Lender
acknowledqe that the security instrument shall be deemed a
Reneqotia.ble Ltate Mortqage ("RRM" ). The tena of the RR.*i
loan is ~3 years, and tlie tera of the mortqaqe securing
said loan is ~ years. Borrower and Lender agree that
the initial loaa term may be up to six (6) months lonqer
than later terms. '
B. NOTE AOTOMATICALLY RENE'~TABLE. Borrower and Leader
aqree that the Promissory Note ("Yote") secured by the
mortqaqe instrument is automatically renewable for a period
equal to the term of the mortgaqe instrument (up to 30
years). T:~e interest rate may increase or decrease at each
renewal of the short-term ( 3 years) loan, which may
result in an increase or decrease in the amount of the
monthly payment due under the Note.
C. MODIFICATIONS AT ~ENEWAL. Lender aqrees that the
only provision of said note which may be modified at renewai
is the contract interest rate set forth therein, toqether
with any chanqe in the_amount of the monthly installaents o~
principal and interest necessary to amortize a loan with the same
principal and at the same interest rate over the remaining term
of this mortgaqe. Borro~rer and Lender agree that the interest
r3te offered at renewal shall be based upon-a monthly index
rate computed by the Federal Home Loan Bank Board, as set
forth in the Note. Interest rate decreases and increases
are mandatory and are not discretionary or optional with the
Lender. _
D. BORROWER'S RIGH"_' OF REFUSAL. Borrower and Ler.der
acknowledge that Borrower has the right to decline Lender's
offer of =enewal, in which case the reaaininq balance of the
unpaid principal and interest secured by the mortgage becemes
due and payable upon the aaturity day of the Initial Loan
Term, or any Renewal Loan Tera, as the.c~se r~ay be.
E. NOTICE. At least ninety (90) days before the end
of the Initial Loan Term and any Renewal Loan Terms, except
for the final Renewal Loan Term, the Lender must send to the
3orrower a renewal notice which states, among ot~er things,
the renewal interest rate and new monthly instal2aent for
the next Renewal Loan Term.
F. PREPAY?~+II:NT. The unpaid principal balance secured
by the security instrument ~ay be prepaid in full or in Dart
without ~enalty at any time.
G. REMEDZES. If Horrower breaches Borrower's covenants
and agreements hereunder, then Lender mav invoke any remedies
provided undes the security instrument, includinq, but not
limited to, those provided under Uniform Covenant 7.
h.~347 ~~~E1625
LCS -6 9
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