408.01D

Funds as Additional Security for Mortgage Loan

All funds or other collateral held under a Collateral AgreementCollateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. constitute additional security for the Borrower’sBorrower’sPerson who is the obligor per the Note. obligations under the NoteNoteInstrument evidencing a Mortgage Loan obligation, including  Form 6010 series,  any other Fannie Mae-approved note, and  all applicable addenda, schedules, and exhibits.  and the other Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .  In the event of a default under the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. , Fannie Mae reserves the right to apply (or direct the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to apply) the funds or other collateral held under any Collateral AgreementCollateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. in any manner allowed under the terms of such Collateral AgreementCollateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. .  Following a default, unless instructed by Fannie Mae, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must not:

  • release any funds or other collateral held under a Collateral AgreementCollateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. ;
  • apply any funds or collateral to the repayment of the Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. ; or
  • reimburse itself from such funds or collateral for any expenses or losses incurred by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. .