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<br />" . <br /> <br />. , <br /> <br />. <br /> <br />. <br /> <br />. <br /> <br />(a) The payment-to-income ratio of the Mortgagor and the obligations- <br />to-income ratio of the Mortgagor (and of any guarantor) shall be not less <br />than the current underwriti ng requi rements of FHLMC for a conventi ona 1 <br />mortgage on the basis of payments applicable during the first year of the <br />Mortgage Loan taking into account the reduction in the Mortgagor's monthly <br />payments during the first year; <br /> <br />(b) the Developer must deposit money in a trust account with the <br />Seller for the benefit of the Mortgagor with monthly releases scheduled from <br />such account which serve to reduce the Mortgagor's payments during the early <br />years of the term of the Mortgage Loan; <br /> <br />(c) the term of the "buydown" period may not be less than one year or <br />more than three years; <br /> <br />(d) the "buydown" may not haye the effect of reduci ng the Mortgagor's <br />monthly payments by more than an equivalent of reducing the Mortgage Loan <br />interest rate by three percentage points; <br /> <br />(e) any decrease in the amount of the "buydown" must occur annually <br />and no such decrease for anyone year may exceed the greater of one <br />percentage point or 7-1/2% of the previous year's monthly payment; <br /> <br />(f) the trust account must be held by the Seller and must be insured by <br />FSLIC; <br /> <br />(g) the Mortgage Loan may make no reference to the "buydown" and the <br />interest rate and monthly payments provided in the Mortgage Loan may not <br />take into account the "buydown"; <br /> <br />(h) the trust agreement with the Developer must require the Seller to <br />credit monthly payments for the account of the Mortgagor; <br /> <br />(i) the trust agreement must provide for any interest on the trust <br />account to be paid to the Developer or remain in the trust and for reversion <br />of moneys held in the trust account to the Developer if the Residence is <br />sold by the Mortgagor or the Mortgage Loan is prepaid in full, whether <br />voluntarily or involuntarily; <br /> <br />(j) the moneys for the "buydown" must be placed in the trust account <br />prior to purchase of the participation in the Mortgage Loan by the Trustee <br />and must be sufficient (without interest unless interest is to remain in the <br />trust account and the Seller agrees to a fixed rate of interest for the full <br />term of the trust) to make all monthly payments provided under the <br />"buydown"; and <br /> <br />(k) the Mortgagor's only interest in the escrowed moneys is to have <br />them applied to payments due under the Mortgage Loan as provided in this <br />paragraph and such moneys may not be used to pay past due payments of the <br />Mortgagor," <br /> <br />2 <br /> <br />11- ZS- <br /> <br />7A <br />