Common use of Application of Buydown Funds Clause in Contracts

Application of Buydown Funds. On or before the closing date if there are any buydown mortgage loans in the Trust Fund, CitiMortgage will open the buydown account with the Depository in the name of the Trustee, on behalf of the mortgagors. For each buydown mortgage loan, on the business day following receipt of the mortgagor’s required monthly payment under the buydown agreement, CitiMortgage will withdraw from the buydown account and deposit in immediately available funds in the certificate account an amount which, when added to the mortgagor’s payment, will equal the full monthly payment due under the mortgage note. No later than the fifth business day before the last business day of each month, CitiMortgage will deposit in the buydown account in immediately available funds an amount equal to interest at the rate per annum specified in the buydown agreement compounded monthly on the buydown funds for each buydown mortgage loan. If a buydown mortgage loan is fully prepaid while buydown funds remain in the buydown account, the unpaid principal balance of the buydown mortgage loan will be reduced by the amount of the buydown funds (which reduction will constitute a principal prepayment) and, on the business day following the date of the principal prepayment, CitiMortgage will deposit the buydown funds in the certificate account. If the property securing a buydown mortgage loan is sold in liquidation of the buydown mortgage loan (either by CitiMortgage or the insurer under any related primary mortgage insurance policy) while buydown funds remain in the buydown account, the buydown funds will be (i) deposited in the certificate account on the business day following the liquidation as a reduction of the unpaid principal balance of the buydown mortgage loan or (ii) to the extent required under an applicable primary mortgage insurance policy, paid to the insurer of the mortgage loan.