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8orrowes and Lender ooveaent and agree as follows:
I. Payment of Principal and Interest. Borrower shall promptly pay when due the principal of and interest on the iadebtednea
evidenced by the Note, prepayment and late drarga es provided in the Note, and the prindpal of and interest on any Future Advances secured
by this Morfgaga
2 Fsurda for 1`a:ee and Iutsuranee. Subject to applicable law or to a written waiver by Lender, Borrower shall pay to Lender on the day
monthly installments of principal and iatefest are payable under the Note, until the Note is paid in full, a sum (herein "Fonda") equal to oae-
twelfth of the yearly taxes and aasesementa which may attain priority over this Mortgage. and ground renb on the Property. if any, plus ono
twelfth of yearly premium installments for hasard insurance. plus onetweltth of year~jr premium installments for mortgage insurance, if arty,
all as reasonably estimated initially and ltom time to time by Lender on the basis of assessments and biW and reasonable estimates thereof.
The Funds shall be held in an insdtntion the depodts or accounts of which are insured or guaranteed by a Federal or State agency
(inducting Lender U Lender i. such an irutitntionl. Lender shall apply the Funds to pay said taxes, assessments, insurance premiums and
ground rents. Lender may not charge for so holding and applying the Funds, analrung said account, or verifying and eampiliag said
asseswseata and biW. unless Lends pays Borrower interest on the Funds and applicable law permits Leader to make such a charge. Borrower
sad Lender may agree is writing at the time of execution of this Mortgage that intered on the Funds shall be paid to Borrower. and ndess
such agreement is made or applicable law regains such interest to be paid, Lender shall not be required to pay Borrower any intered or
earnings on the Fends. Lender shall give to Borrower. without d?arge, as annual aoceunting of the Fonds showing credits and debits to the
Funds and the purpose for which each debit to the Funds was made. The Funds are pledged as additional security for We sums secured by this
Mortgage.
If the amount of the Funds held by Ler?der, together with the future monthly installments of Funds payable prior to We due dates of tares,
assessments, insurance premiums and grormd rents. shall e:oaed the amount required to pay said taxes. assessments, insurance premiums
and ground reab e. they fall due. such sasses shall be, at Borrower's option. either promptly repaid to Borrows or credited to Borrower on
monthly installments of Ptimds. U the amount of the Farads heW by Lender shall not be suffi~ciart to pay tares, assesmaents. insurance
premiums sad ground rents as they tall due, Borrower shall pay to Lender any amount necessary to make up the deficiency within 30 days
from the date rwtice is mailed by Lender to Borrower requesting payment thereof.
Upon payment in full of all sums secured by this Morlgage. Leader shall pranptly refund to Borrower any funds held by Lender. If under
paragraph 18 hereof the Propez<y? is sold or the Property is otherwise acquirrd by Leader, Lender shall apply, no later than immediately prior
to the sale of the Property or its soquidtion by Lender.say Fends held by Lender at the time of application as a credit against the sums secured
by this Mortgage.
3. Application of Payments. Unless applicable law provides otherwise, all payments received by Lender under We Note and
paragraphs 1 and 2 hereof shall be applied by Lender first in payment of amounts payable to Lender by Borrower under paragraph 2 hereof,
then to interest payable on the Note, then to the principal of the Note, and then to interest and principal on any Future Advances.
4. Charges; Liens. Borrower shall pay all taxes, assessments and other charges, fines and impositions attributable to the Property which
may attain a priority over this Mortgage, and leasehold payments or ground rents. if any, in the manner provided under paragraph 2 hereof or,
if not paid in such manner, by Borrower making payment, when due, directly to the payee thereof. Borrower shall promptly furnish to Lender
all notices of amounts due under this paragraph. and in the event Borrower shall make payment directly, Borrower shall promptly furnish to
Lender receipts evidencing such payments. Borrower shall promptly discharge any lien which has priority over this Mortgage; Provided. that
Borrower shall not be required to discharge any such lien so long as Borrower shall agree in writing to the payment of the obligation secured by .
such lien in a manna acceptable to Lender. or shall in good faith eonteat such lien by, or defend enforcement of such lien in, legal proceedings
which operate to prevent the enforcement of the lien or forfeiture of the Property or any part thereof.
b. Hazard Insurance. Borrows shall keep the improvements now existing or hereafter erected on the Property insured against lose by
fire, hazards inducted within the tam "extended oovsage." and such other hazards as Lender may require and in such amounts and for arch
periods as Leader may require; provided. that Lender shall not require nude oovaage amount exceeding the minimum, as may be required by
state or federal regulations governing activities of I.enda, or that amount of coverage required to pay the soma secured by this Mortgage.
whichever is the greater.
The insurance carries providing the insurance shall be chosen by Borrows subject to approval by Lender, provided, that such approval
shall not be unreasonably withheld. All premiums on insurance policies shall be paid in the manner provided under paragraph 2 hereof or, if
not paid in each manna. by Borrows making payment. when due, directly to the insurance carrier.
All insurance policies and renewals thereof shall be in form acceptable to Lends and shall inducts a standard mortgage douse in favor of
~I and in form acceptable to Lends. Calder shall have the right to hold the policies and renewals thereof, and Borrows shall promptly furnish to
i.enda all renewal notices and all receipts of paid premiums. In the event of toes, Borrower shall give prompt notice to the insurance carris
and Lends. Lends may make proof of loss if not made promptly by Borrows.
Unless Lends and Borrows otherwise agree in writing. insurance proceeds shall be applied to restoration or repair of the Property
damaged, provided such restoration or repair is economically feasible and the security of this Mortgage is not thereby impaired. If such
restoration or repair i8 not economically feasible or if the security of this Mortgage would be impaired, the insurance proceeds shall be applied
to the same secured by this Mortgage. with the exeeas, if any, paid to Borrows. If the Properly is abandoned by Borrows, or if Borrows fails to
respond to Lends within 30 days from We date notice is mailed by Lender to Borrows that the insurance carris oBers to settle a claim for
insurance benefits, Lends is authorized to collect and apply the insurance proooeds at Lender's option either to restoration or repair of the
Property or the sums secured by this Mortgage.
Unless Lends and Borrows otherwise agree in writing, any such application of proceeds to principal shall not extend or postpone the due
date of the monthly installments referred to in paragraphs 1 and 2 hereof or diange the amount of arch installments. If ands paragraph 18
hereof the Property is acquired by Lends. all right, title and interest of Borrows in and to any insurance policies and in and to the proceeds
thereof resulting from damage to Property prior to the sale or acquisition shall pass b Lends to the extent of the soma secured by this
Mortgage immediately prior to snd? sale or acquisition.
6. Plreservadon and 1Ra3ntenanoe of Property; Leaseholds; Condominnma;Planned Unit Developments.BorrowerahaU keep
the Properly in good repair and shall not commit waste or pe:unit impairment or deterioration of the Properly and shall comply with the
provisions of any lease if this Mortgage is on a leasehold. If this Mortgage is on a unit in a condominium or a plarmed unit development,
Borrower shall perform all of Borrower's obligations node the declaration or covenants creatiagor governing the condominium or planned
unit development, the by-laws and regulations of the oondomiruum or planned unit development, and constitneat documents. If a
condominium or planned unit development rids is executed by Borrows sad recorded togeths wiW this Mortgage, the oovarants and
agreements of such rids shall be incorporated into and shall amend and supplement the eovenante and agreements of this Mortgage as if the
rider were a part hereof.
7. Protection of Lender's Security. If Borrows fails to perform the covenants and agreemmts contained in this Mortgage, or if any
action or proceeding is eommenoed which materially a~ecta Lender's interest in the Property. inducting, bet not limited to, eminent domain,
insolvency, code enforcement, or arrangement. or proceedings involving a bankrupt or decedent. they Lender at Lender's option,npon
notion to Borrower may make such sppearanoes, disburse such sums and take sndr action as is necessary to protect Lender's interest,
inducting, but not limited to, disbnnement of reasonable attorney's fees and entry upon the Property to make repairs. If Larder required
mortgage insurance as a condition of making the loan secured by this Mortgage. Borrows shall pay the premiums required to maintain
snc6 insurance is effect until such time as the requirement for such insurance terminates in aceordanoe with Borrower's and Lender's
written agreement or applicable Lew. Borrows shall pay the amount of all mortgage insurance premiums in We manna provided ands
paragraph 2 hereof
Any amonntti disbursed by Lender persuant to this Paragraph 7, with interest thereon, shall become additional indebtedness of
Borrows secured by this Mortgage. Unless Borrows and Lerida agree to other terms of payment, such amounts shall be payable upon
notice from Lwda to Borrows requesting payment thereof. and shall bear interest from the date of disbursement at the rate payable from
time to time on outstanding principal undo the Note unless payment of interest at wch rate would be contrary to applicable law. in which
event such sarounts shall bear interest at the highest rate permissible ands applicable law. Nothing eontained in this paragraph 7, shall
require Lends to incur any expense or take any action hereunds.
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