Common use of ARMs Clause in Contracts

ARMs. The Servicer shall enforce each ARM in accordance with its terms and shall timely calculate, record, report and apply all interest rate adjustments in accordance with the related Promissory Note. The Servicer's records shall, at all times, reflect the then Loan Interest Rate and monthly payment and the Servicer shall timely notify the Borrower of any changes to the Loan Interest Rate or the Borrower's monthly payment. If the Servicer fails to make either a timely or accurate adjustment to the Loan Interest Rate or monthly payment or to notify the Borrower of such adjustments, the Servicer shall pay from its own funds any shortage. If the Servicer's failure to make a scheduled change affects the Trust's rights to make future adjustments under the terms of the ARM, the Servicer shall purchase the ARM, in accordance with the provisions of the last sentence of Section 3.08(b). Any amounts paid by the Servicer pursuant to this Section shall not be an advance and shall not be reimbursable from the proceeds of any Loan.