$247,244,000
RESIDENTIAL FUNDING MORTGAGE SECURITIES II, INC.
Depositor
HOME EQUITY LOAN TRUST 1996-HS3
RESIDENTIAL FUNDING CORPORATION
Master Servicer
Home Equity Loan-Backed Term Notes, Series 1996-HS3
Supplement dated October 29, 1996
to
Prospectus Supplement dated October 24, 1996
to
Prospectus dated May 23, 1996
Under the heading "Summary-Interest Payments" in the Prospectus
Supplement dated October 24, 1996, the third sentence is replaced in its
entirety by the following:
However, on any Payment Date on which interest accrued on the Notes during the
related Interest Period exceeds an amount equal to one-twelfth of the product of
(a) the ratio of the Security Balance of the Notes to the Security Balance of
the Securities multiplied by (b) the aggregate Principal Balance of the
Revolving Credit Loans multiplied by (c) the Net Loan Rate Cap (as defined
herein), the amount of such difference (any such amount, an "Interest
Shortfall") will not be included as interest payments on the Notes for such
Payment Date and such amount will accrue interest at the Note Rate on the Notes
(as adjusted from time to time) and will be paid on future Payment Dates pro
rata based on the Security Balance thereof only to the extent funds are
available therefor as set forth herein under "Description of the
Securities--Allocation of P&I Collections."
Under the heading "Description of the Securities-Interest on the Notes"
in the Prospectus Supplement, dated October 24, 1996, the third sentence is
replaced in its entirety by the following:
However, on any Payment Date on which interest accrued on the Notes during the
related Interest Period exceeds an amount equal to one-twelfth of the product of
(a) the ratio of the Security Balance of the Notes to the Security Balance of
the Securities multiplied by (b) the aggregate Principal Balance of the
Revolving Credit Loans multiplied by (c) the Net Loan Rate Cap (as defined
herein), the amount of such difference (any such amount, an "Interest
Shortfall") will not be included as interest payments on the Notes for such
Payment Date and such amount will accrue interest at the Note Rate on the Notes
(as adjusted from time to time) and will be paid on future Payment Dates pro
rata based on the Security Balance thereof only to the extent funds are
available therefor as set forth herein under "-Allocation of P&I Collections."
[NY01:234907.1] 16069-00369 10/28/96 9:07pm
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