Sample Mortgage Form
Any amounts disbursed by Lender pursuant to this paragraph 7, with interest thereon.
shall b ecome additi o nal in debtedness of Borr ower secured by this M ort g age. U nl e ss
Borrower and Lender agree to other terms of payment, such amounts shall be payable
upon notice from Lender to Borrower requesting payment thereof. and shall bear interest
from the date of dis bursem ent a t the r ate payable from tim e to ti me o n outs t an di ng
principal under the Note unless payment of interest at such rate would be contrary to
applicable law , in which event such a m oun ts shall bear interest at the high e st rate
permissible under a p plicab le law . Nothin g con tai ned in this para gra ph 7 shall requi re
Lender to incur any expense or take any a ction hereunde r.
8. Inspection. Lender may mak e or ca use t o be m ade reas onable entrie s up on and
inspecti o ns of the Property, provi de d th at Le nder shall give Borrow e r no tice p r i or to an y
such inspection specifying reasonable cause therefor relat ed to Lender's interest in the
Property.
9. Condemnation. The proceeds of an y award or claim for damages, direc t or
conse q uent ial. in con nec tion with a ny c o ndemnati o n or o t her taking of the P rop e rty, or
part thereof. or for conveyance in lieu of condemnation. are hereby assigned and shall be
paid to Lender.
In the event of a total taking of the Property. the proceeds shall be applied to the sums
secu red by this Mortgage. With the excess. if any, paid to Borrower. In the event of a
partial taking of the Property, unless Borrower and Lende r otherwise agree in writin g.
there shall be app li e d to the s ums secure d by this Mortga ge s u ch p roportio n of the
proceeds as is equal to that proportion which the amount of the sums sec ured by this
Mortgage immediately pri or t o t he date of taking bea rs to t h e fair mar ket val ue of the
Property immediately prio r t o t he dat e of taking. with the bala nce of the pro ceeds paid to
Borrower.
If the Prope rty is aban doned by Bo rrower . or if. after notice by Lender to Borrower that
the condemnor offers to make an award or settle a claim for damages. Borrower fails to
respond to Lender within 30 days after the date such notice is mailed . Lender is
authorized to collect and apply the proceeds. at Lender's option. either to restoration or
repair of the Property or to the sums secured by this Mortgage.
Unless Lender and Borrower otherwise agree in writing. any such application of
proceeds to princi pal shall not extend or postpone the due date of the monthl y
installments referred t o in para graphs 1 and 2 hereof or change the am ount of such
installments.
10. Borrower Not Released. Extensio n of the time for pa yment o r mo di ficat i o n of
amortization of the sums secured by this Mortgage granted by Lender to any successor in
interest of Borrower shall not operate to release. in any manner, the liability of the
original Borrower and Borrower's successors in interest. Lender shall not be required to
commence proceedings aga i nst such successor or refuse to extend time for payment or
otherwise modify amortization of t he sum s se cured by t his Mort ga ge by r easo n of a ny
demand ma de b y the ori gin al B or r o w er and Borrower's successors in interest.
Page 7/17
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