Application Priority Clause Samples

Application Priority. A payment from a Borrower will normally consist of interest, principal, deposits for insurance and taxes and late charges, if applicable. Payments received from Borrowers must be applied in the order provided for in the related Security Instrument. To the extent not inconsistent with the related Security Instrument, such payments shall be applied in the following order: (a) required monthly interest; (b) required monthly principal; (c) deposits for taxes and insurance; (d) prepayment charges; and (e) any fees which may be retained by the Servicer, including late charges, returned check fees, and assumption fees.