Common use of Direct Payment to Contractors and Others Clause in Contracts

Direct Payment to Contractors and Others. After the occurrence of an Event of Default, Lender shall have the right, but not the obligation, to pay any amount of any Advance directly to any contractor, Title Company, any design professional or other Person instead of advancing that money to Borrower, and will notify Borrower in advance and in writing when it has exercised that election on each occasion it does. Any Advance by Lender for such purpose shall be part of the Loan and shall be secured by the Loan Documents. Borrower hereby authorizes Lender to hold, use, disburse, and apply each Loan for payment of costs of construction of the improvements after an Event of Default, expenses incident to such Loan and the Lot or Home, and the payment or performance of any obligation of Borrower hereunder, including, without limitation, interest on the Loans, any reasonable Loan fees owing to Lender, reasonable legal fees of Lender’s attorneys which are payable by Borrower, and such other reasonable sums as may be owing from time to time by Borrower to Lender with respect to the Loan. No further direction or authorization from Borrower shall be necessary to warrant such direct Advances and all such Advances shall satisfy pro tanto the obligations of Lender hereunder and shall be secured by the Loan Documents as fully as if made directly to Borrower. Notwithstanding the other provisions of this paragraph, nothing in this Agreement is intended to be for the benefit of, nor may be enforced by, nor should be relied upon by, any Person other than Borrower.