######## [APPENDIX XI: tax-exempt financing rider]{.underline}

THIS TAX-EXEMPT FINANCING RIDER is made this \_\_\_\_\_\_\_\_\_\_\_ day
of \_\_\_\_\_\_\_\_\_, 20\_\_, and is incorporated into and shall be
deemed to amend and supplement the Mortgage, Deed of Trust or Security
Deed (\"Security Instrument\") of the same date given by the undersigned
(\"Borrower\") to secure Borrower\'s Note (\"Note\") to
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (\"Lender\") of
the same date and covering the property described in the Security
Instrument and located at:

\[Property Address\]

**ADDITIONAL COVENANTS.** In addition to the covenants and agreements
made in the Security Instrument, Borrower and Lender further covenant
and agree to amend Paragraph 9 of the Security Instrument, entitled
\"Grounds for Acceleration of Debt,\" by adding additional grounds for
acceleration as follows:

Lender, or such of its successors or assigns as may by separate
instrument assume responsibility for assuring compliance by the Borrower
with the provisions of this Tax-Exempt Financing Rider, may require
immediate payment in full of all sums secured by this Security
Instrument if:

(a) All or part of the Property is sold or otherwise transferred by
    Borrower to a purchaser or other transferee:

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1.  Who cannot reasonably be expected to occupy the property as a
    principal residence within a reasonable time after the sale or
    transfer, all as provided in Section 143(c) and (i)(2) of the
    Internal Revenue Code; or

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1.  Who has had a present ownership interest in a principal residence
    during any part of the three-year period ending on the date of the
    sale or transfer, all as provided in Section 143(d) and (i)(2) of
    the Internal Revenue Code (except that \"100 percent\" shall be
    substituted for \"95 percent or more\" where the latter appears in
    Section 143(d)(1)); or

2.  At an acquisition cost which is greater than 90 percent of the
    average area purchase price (greater than 110 percent for targeted
    area residences), all as provided in Section 143(e) and (i)(2) of
    the Internal Revenue Code; or

3.  Who has a gross family income in excess of the applicable median
    family income as provided in Section 143(f) and (i)(2) of the
    Internal Revenue Code; or

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(a) Borrower fails to occupy the property described in the Security
    Instrument without prior written consent of Lender or its successors
    or assigns described at the beginning of this Tax-Exempt Financing
    Rider, or

(b) Borrower omits or misrepresents a fact that is material with respect
    to the provisions of Section 143 of the Internal Revenue Code in an
    application for the loan secured by this Security Instrument.

> References are to the Internal Revenue Code as amended and in effect
> on the date of issuance of bonds, the proceeds of which will be used
> to finance the purchase of the Security Instrument and are deemed to
> include the implementing regulations.^1^
>
> BY SIGNING BELOW, Borrower accepts and agrees to the terms and
> covenants contained in this Tax-Exempt Financing Rider.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (SEAL)

Borrower

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (SEAL)

Borrower

\[ADD ANY NECESSARY ACKNOWLEDGEMENT PROVISIONS.\]

1.  If bond proceeds are used for purposes other than mortgage purchase,
    such as for direct loans to homeowners or as loans to lenders who
    lend to homebuyers, the description of the bonds should be amended
    as needed.