Fill - Free fillable HMFA 1-4 FAMILY/ TAX-EXEMPT FINANCING RIDER (NJHMFA) PDF form

HMFA 1-4 FAMILY/

TAX-EXEMPT FINANCING RIDER

THIS 1-4 FAMILY/TAX-EXEMPT FINANCING RIDER IS MADE THIS day of

, , and is incorporated into and shall be deemed to amend and supplement the

Mortgage, Deed of Trust or Security Deed ("Security Instrument") of the same date given by the

undersigned ("Borrower") to secure Borrower's Note ("Note") to

("Lender") of the same date and covering the property described in the Security Instrument and located

at:

1) In addition to the covenants and agreements made in the Security Instrument, Borrower and Lender

further covenant and agree that it will be a condition of default by the Borrower and grounds for

acceleration (Lender may require immediate payment in full of all sums secured by this Security

Instrument) if:

A. All or part of the Property is sold or otherwise transferred by Borrower to a purchaser or

other transferee:

(i) Who cannot reasonably be expected to occupy the property as a principal residence

within a reasonable time after the sale or transfer, all as provided in Section 143(c)

and (i)(2) of the Internal Revenue Code; or

(ii) Who has had a present ownership interest in a principal residence during any part

of the three-year period ending on the date of the sale or transfer, all as provided in

Section 143(d) and (i)(2) of the Internal Revenue Code (except that "100 percent"

shall be substituted for "95 percent or more" where the latter appears in Section

143(d)(1); or

(iii) Has an acquisition cost which is greater than 90 percent of the average area

purchase price (greater than 110 percent for targeted area residences), all as

provided in Section 143(e) and (i)(2) of the Internal Revenue Code; or

(iv) Who has a gross family income in excess of the applicable percentage of applicable

median family income as provided in Section 143(f) and (i)(2) of the Internal

Revenue code; or

B. Borrower fails to occupy the property described in the Security Instrument without prior

written consent of Lender or its successors or assigns described at the beginning of this 1-

4 Family Tax Exempt Financing Rider, or

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C. Borrower omits or misrepresents a fact that is material with respect to the provisions of

Section 143 of the Internal Revenue Code in an application for this loan secured by this

Security Instrument.

D. Borrower covenants and agrees that Borrower shall within 60 days from the date hereof

and continually thereafter during the term of this mortgage occupy the Property as

Borrower's principal residence. This paragraph supersedes paragraph 6 of the mortgage

document.

References are to the Internal Revenue Code of 1986, as amended and in effect on the date of

issuance of bonds, the proceeds of which will be used to finance the purchase of the Security

Instrument and are deemed to include applicable Treasury regulations.

2) Mortgage Insurance. If Lender required mortgage insurance as a condition of making the loan

secured by this Security Instrument, Borrower shall pay the premiums required to maintain the mortgage

insurance in effect. If, for any reason, the mortgage insurance coverage required by Lender lapses or

ceases to be in effect, Borrower shall pay the premiums required to obtain coverage substantially

equivalent to the mortgage insurance previously in effect, at a cost substantially equivalent to the cost to

Borrower of the mortgage insurance previously in effect, from an alternate mortgage insurer approved by

Lender. Borrower shall pay the premiums required to maintain mortgage insurance in effect until the

requirement for mortgage insurance ends in accordance with any written agreement between Borrower

and Lender or applicable law. This paragraph supersedes paragraph 10 of the mortgage document.

3) Mortgagee’s Reliance on Borrower's Representations. Borrower hereby warrants and represents that

all affirmations made in the Mortgagor's Affidavit executed by the Borrower hereof, which have been

relied upon by the Mortgagee in the granting of this mortgage loan are true and correct. In the event

during the term of this mortgage loan it is discovered that Borrower has made any false statements on

the aforementioned affidavit, then the entire principal balance together with accrued interest shall, at the

option of the mortgagee, become immediately due and payable.

4) In addition to the covenants and agreements made in the Security Instrument, Borrower and Lender

further covenant and agree that with regard to the 1-4 Family covenants as follows:

A. ADDITIONAL PROPERTY SUBJECT TO THE SECURITY INSTRUMENT. In addition to

the Property described in the Security Instrument, the following items are added to the

Property description, and shall also constitute the Property covered by the Security

Instrument: building materials, appliances and goods of every nature whatsoever, owned

by the borrower, now or hereafter located in, on, or used, or intended to be used in

connection with the electricity, gas, water, air and light, fire prevention and extinguishing

apparatus, security and access control apparatus, plumbing, bath tubs, water heaters,

water closets, sinks, ranges, stoves, refrigerators, dishwashers, disposals, washers,

dryers, awnings, storm windows, storm doors, screens, blinds, shades, curtains and curtain

rods, attached mirrors, cabinets, paneling and attached floor coverings now or hereafter

attached to the Property, all of which, including replacements and additions thereto, shall

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deemed to be and remain a part of the Property covered by the Security Instrument. All of

the foregoing together with the Property described in the Security Instrument (or the

leasehold estate if the Security Instrument is on a leasehold) are referred to in this 1-4

Family/Tax-Exempt Rider and the Security Instrument as the "Property."

B. USE OF PROPERTY; COMPLIANCE WITH LAW. Borrower shall not seek, agree to, or

make a change in the use of the Property or its zoning classification, unless Lender has

agreed in writing to the change. Borrower shall comply with all laws, ordinances,

regulations and requirements of any governmental body applicable to the Property.

C. SUBORDINATE LIENS. Except as mandated by federal law, Borrower shall not allow any

lien inferior to the Security Instrument to be perfected against the Property without Lender's

prior written permission.

D. RENT LOSS INSURANCE. Borrower shall maintain insurance against rent loss for any

rental units in addition to the other hazards for which insurance is required by Uniform

Covenant 5.

E. ASSIGNMENT OF LEASES. Upon Lender's request, Borrower shall assign to Lender all

leases of the Property and all security deposits made in connection with leases of the

Property. Upon the assignment, Lender shall have the right to modify extend or terminate

the existing leases and to execute new leases, in Lender's sole discretion. As used in this

paragraph E, the word "lease" shall mean "sublease" if the Security Instrument is on a

leasehold.

F. ASSIGNMENT OF RENTS; APPOINTMENT OF RECEIVER; LENDER IN POSSESSION.

Borrower absolutely and unconditionally assigns and transfers to Lender all the rents and

revenues ("Rents") of the Property, regardless of to whom the Rents of the Property are

payable. Borrower authorizes Lender or Lender's agents to collect the Rents, and agrees

that each tenant of the Property shall pay the Rents to Lender or Lender's agents.

However, Borrower shall receive the Rents until (i) Lender has given Borrower notice of

default pursuant to paragraph 22 of the Security Instrument and (ii) Lender has given

notice to the tenant(s) that the Rents are to be paid to Lender or Lender's agent. This

assignment of Rents constitutes an absolute assignment and not an assignment for

additional security only.

If Lender gives notice of the breach to Borrower: (i) all Rents received by the Borrower

shall be held by borrower as trustee for the benefit of Lender only, to be applied to the

sums secured by the Security Instrument; (ii) Lender shall be entitled to collect and receive

all of the Rents of the Property; (iii) Borrower agrees that each tenant of the Property shall

pay all Rents due and unpaid to Lender or Lender's agents upon Lender's written demand

to the tenant; (iv) unless applicable law provides otherwise, all Rents collected by Lender

or Lender's agents shall be applied first to the costs of taking control of and managing the

Property and collecting the Rents, including, but not limited to, attorney's fees, receiver's

fees, premiums on receiver's bonds, repair and maintenance costs, insurance premiums,

taxes, assessments and other charges on the Property, and then to the sums secured by

the Security Instrument; (v) Lender, Lender's agents or any judicially appointed receiver

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shall be liable to account for only those Rents actually received; and (vi) Lender shall be

entitled to have a receiver appointed to take possession of and manage the Property and

collect the Rents and profits derived from the Property without any showing as to the

inadequacy of the Property as security.

If the Rents of the Property are not sufficient to cover the costs of taking control of and

managing the Property and of collecting the Rents any funds expended by Lender for such

purposes shall become indebtedness of Borrower to Lender secured by the Security

Instrument pursuant to Uniform Covenant 9.

Borrower represents and warrants that Borrower has not executed any prior assignment of

the rents and has not and will not perform any act that would prevent Lender from

exercising its rights under this paragraph.

Lender, or Lender's agents or a judicially appointed receiver, shall not be required to enter

upon, take control of or maintain the Property before or after giving notice of default to

Borrower. However, Lender, or Lender's agents or a judicially appointed receiver, may do

so at any time when a default occurs. Any application of Rents shall not cure or waive any

default or invalidate any other right or remedy of Lender. This assignment of Rents of the

Property shall terminate when all the sums secured by the Security Instrument are paid in

full.

G. Any amounts received under Uniform Covenant 11, which could otherwise be paid to the

Borrower, shall, as a remedy, which may be exercised by the Lender at the Lender's

discretion, be retained by the Lender and applied to the Borrower's arrears under the Note

and the Security Instrument.

H. CROSS-DEFAULT PROVISION. Borrower's default or breach under any note or

agreement in which Lender has an interest shall be a breach under the Security Instrument

and Lender may invoke any of the remedies permitted by the Security Instrument.

BY SIGNING BELOW, Borrower accepts and agrees to the terms and provisions in this 1-4Family/Tax-

Exempt Financing Rider.

(SEAL)

Borrower

(SEAL)

Borrower

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