HUD 50112 Construction Loan Rider

Section 184 Case #:

CONSTRUCTION LOAN RIDER

THIS CONSTRUCTION LOAN RIDER is made this __________ day of, 20 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:

(property address)

ADDITIONAL COVENANTS. In addition to the covenants and agreements made in the Security Instrument, Borrower and Lender further covenant and agree as follows:

A. All replacements and additions, and Borrower’s interest in the Construction Escrow Account established in connection with this Security Instrument shall be covered by this Security Instrument.

B. Loan proceeds are to be advanced for the construction of the premises in accordance with the Construction Loan Agreement dated ___________,20___, between the borrower and lender. This agreement is incorporated by reference and made a part of this mortgage. No advances shall be made unless approved by the Assistant Secretary of Public and Indian Housing, Department of Housing and Urban Development.

C. If the construction is not properly completed, performed with reasonable diligence, or is discontinued at any time except for strikes or lockouts, the lender is vested with full authority to take the necessary steps to protect the construction and the property from harm, continue existing contracts or enter into necessary contracts to complete the construction. All sums expended for such protection shall be added to the principal indebtedness, and be secured by the mortgage and be due and payable on demand with interest as set out in the note.

D. If the borrower fails to make any payment or to perform any other obligation under the loan, including the commencement progress, and completion provisions of the Construction Loan Agreement, and such failure continues for a period of 30 days, the loan shall, at the option of the lender, be in default.

BY SIGNING BELOW, Borrower accepts and agrees to the terms of the covenants contained in this Construction Loan Rider.

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Borrower/Date

_______________________________________ Borrower/Date

HUD-50112 (09/2012)