HomeMy WebLinkAbout2270 Earh monthly installment for items (a), (b), and (c) shall eyual one-t~~elfth of the annual amounts, as reasonahly~ estimated
t~~ Len~ler, plus ar~ amount ~ufficient to maintain an additional batanre of not more than c~ne-sixth of the estimated am~unts.
fh~ full annual amount for each item shall be arcumulated by Lender H~ithin a period ending one month before an item H~ould
h~come delinquent. Lender shall hold the amounts rollected in uust to pay items (a), (b>, and (c) before they become delinquent.
If at an}• time the ro~al of the payments held by Lender for items (a), (b), and (cl, together with the future monthly payments
~ur ~uch i~ems payabtr tu Lender prior to [iie due dates oi such items, exceeds by more than one-si~th the estimated amount
ui pay~ments required to pay such items when due, and if payments on the Note are current, then Lender shall either refund
thc e~cess over one-sixth of the estimated payments or credit the excess over one-sixth of the estimated payments to subsequent
E~a~ments by Borroti~er, at the op[ion of BorroHer. If
the total of the payments made by BorroH~er for i!em (a), (b), or (c)
i, insufficient to pa~• the item when due, then Borrower shall pay to Lender any amount necessary~ to make up the de~ciency
~~n or before the date the item becomes due.
As used in this Security Instrument, "Secretary" means the Secretary o` Housing and Urban De~~elopment or his or her
designee. Most Security Instruments insured b}• the Secretary are insured under programs which require advance payment of
the entire mortgage insurance premium. If this Security Instrument is or H~as insured under a program which did not require
~id~ ance payment of the entire mongage insurance premium, then each monthly payment shall also include either: (i) an installment
ut the annual mortgage insurance premium to be paid by Lender to the Secretary, or (ii) a monthly charee instead nf a mortQaae
~nsurance prem~um if this Security tnstrument is held by the Secretary. Each monthly installment of the mortgage insurance
~remium shall be in an amount sufficient to accumulate the full annual mortgage insurance premium with Lender one month
4~rior to the date the full annual mortgage insurance premium is due to the Secretary, or if this Security lnstrument is held
b~~ the Secretary, each monthly charge shall be in an amount equal to one-twelfth of
one-half percent of the outstanding principal
balance due on the Note.
If Borrower tenders to Lender the full payment of all sums secured by this Security Instrument, Borrower's account shall
he credited with the balance remaining for all installments for items (a), (b), and and any mortgage insurance premium
i?~stallment that Lender has not become obligated to pay to the Secretary, and Lender shall promptly refund any~ excess funds
~o Borrower. lmmediatel}~ prior to a foreclosure sale of the Property or its acquisition by Lender, Borrow~er's account shall
he credited with an}~ balance remaining for all installments for items (a), (b), and (c).
3. Application of Pa~~ments. All payments under paragraphs 1 and 2 shall be applied by Lender as follows:
First, to the mortgage insurance premium to be paid by Lender to the Secretary or to the monthly charge by the Secretary
instead of the monthly mortgage insurance premium, unless Borrower paid the entire mortgage insurance premium when this
Securi[y Instrument ~~~as signed;
Second, to any taxes, special assessments, leasehold paymenu or gro~nd rents, and fire, flood and other hazard insurance
~remiums, as required;
Third, to interest due under the Note;
! Fourth, to amortization of the principal of the Note;
Fifth, to late charges due under the Note.
4. Fire, Flood and Other Hazard Insurance. Borrower shall insure all improvements on the Property, w~hether now in
' ~.~istence or subsequently erected, against any hazards, casualties, and contingencies, including fire, for which Lender requires
' insurance. This insurance shall be maintained in the amounts and for the pe~iods that Lender requires. Borrower shall also
insure al! improvements on the Property, whether now~ in existence or subsequently erected, against loss by floods to the e!ctent
required by the Secretary. All insurance shall be carried with companies approved by Lender. The insurance policies and any
~ renewals shall be held by Lender and shall include loss payable clauses in favor of, and in a form acceptable to, Lender.
( In the e~rent of loss, Borrower shall give Lender immediate notice by mail. Lender may make proof of loss if not made
; promptlv by Borrow•er. Each insurance company concerned is hereby authorized and directed to make payment for such loss
~ directly to Lender, instead of to Borrower and to Lender jointly. AI! or any part of the insurance proceeds may be applied
~ b~~ Lender, at its option, either (a) to the reduction of the indebtedness under the Note and this Security Instrument, first to
E any delinquent amounts applied in the order in Paragraph 3, and then to prepayment of principal, or (b) to the restoration
! or repair of the damaged property. Any application of the proceeds to the principal shall not extend or postpone the ciue date
; of the monthly payments which are referred to in Paragraph 2, or change the amount of such payments. Any excess insurance
~roceeds over an amount required to pay all outstanding indebtedness under the Note and this Security lnstrument shall be
t ~aid to the entity legally entitled thereto.
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~ in the event of foreclosure of this Security instrument or other transfer of title to the Proper~y ihat ex[inguishes the
~ indebtedness, all right, title and interest of Borrovrer in and to insurance policies in force shall pass to the purchaser.
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~ 5. Preservation and Maintenance of the Property, Leaseholds. Borrower shall not commit waste or destroy, damage or
4 >ubstantiatly change the Property or allow the Property to deteriorate, reasonable wear and tear excepted. Lender may inspect
~ che property if the property is vacant or abandoned or the ]oan is in default. Lender may take reasonable action to protect
g and preserve such vacant or abandoned property. If this Security InstrUment is on a leasehold, Borrower shall compty with
the pro~•isions of the lease. If Borrower acquires fee title to the Property, the leasehoid and fee title shall not be merged unless
~ Lencier agrees to the merger in writing.
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5 6. Charges to Borrower and Protection of Lender's Righis in the Propert}~. Borrower shall pay a!1 governmental or mu:~icipal
~ ~harges, fines and impositions that are not in~luded in Paragraph 2. Borrower shall pay these obligations on time directly to
8 tt~e entity which is owed the payment. If failure to pay w~ould adversely affect Lender's interest in the Property, upon Lender's
request Borrower shall promptly furnish to Lender receipts evidencing these payments.
[f Borrower fails to make these pay~ments or the payments required by Paragraph 2, or fails to perform any other covenants
and agreemems contained in this Security Instrument, or there is a legal proceeding that may significantly affect Lender's rights
in the Property (such as a proceeding in bankrupicy, for condemnatio?~ or to enforce laws or regulations), then Lender may
do and pay whatever is necessary to protect the vafue of the Property and Lender's rights in the Propert}~, including payment
~~f .axes, hazard insurance and other items mentioned in Paragraph 2.
Any amour.ts disbursed by Lender under this Paragraph shall become an additional debt af Borrower and be secured
h> this Security instrument. These amounts shall bear interest from the date of disbursement, at the Note rate, and at the
nption of Lender, shall be immediatelv due and payable.
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z 7. Condemnation. The proceeds of any award or daim for damages, direct or consequential, in connection with any
tondemnation or other taking o~ any part of the Property, ar for conveyance in place of condemnation, are hereby assigned
and shall be paid to L~nder to the extent of the full amount of the indebtedness that remains unpaid under the Note and this
~ecurity Instrument. Lender shall apply such proceeds to the reduction of the indebtedness under the Notc and this Security
I r,strument, first to any delinquent amounts applied in the order provided in Paragraph 3, and then to prepayment of principal.
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