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UNIFORM CovE~pNTS. Borrower and Lender covenant and agrre ;~ti follow~:
1. Payment of Principal and Interest; Prepayment and I.ste Charges. Borrower tihal) prumptly pay ~vhrn dur
the principal of and interest on the debt evidenced by the Note and any prepay~ment and late ~har~eti due under ~h~ ti~~tr.
2. Furtds for Taxes and Insurance. Subject to applicable law or to a w~ritten waiver b~• Lender, Horruwer shall p3~
to Lender on the day monthly payments are due under the Note, until the Note is paid in full, a sum ("Funds") equal to
one-twelfth of: (a) yearly taxes and assessments which may attain priority over this Security Instrument; (b) yearl}~
leasehold payments or ground rents on the Property, if any; (c) y~early hazard insurance premiums; and (d) yearly
mortgage insurance premiums, if any. These items are called "escroN items." Lender may c~timate the Funds due on the
basis of current data and reasonable estimates of futurr escrow items.
The Funds shall be held in an institution the deposits or accounts of w•hich are insur,.i or gua~ anteed by a federal or
state agency (including Lender if l.ender is such an institution~. Lender shall apply the Funds to ~~y the escro~~ itzms.
Lender may not charge for holding and applying the Funds, analyzing the account or verifying the escrow• items, unless
Lender pays Borrow~er interest an the Funds and applicable law permits Lender to make such a charge. Borrower and
Lender may agree in writing that interest shall be paid on the Funds. Unless an agreement is made or applicable law
requires interest to be paid, Lender shait not be required to pay Borrow•er any interest or earnings on the Funds. Lender
shall give to Borrower, without charge, an annual accounting of [he Fur.ds showing credits and debits to the Funds and the
purpose for which each debit to the Funds w~as made. The Funds are pledged as additional security for the sums secured by
this Security Instrument.
If the amount of the Funds held by Lender, together with the future monthly payments of Funds papable prior to
the due dates of the escrow items, shall exceed the amount required to pay the escrow items when due, the excess shall be,
at Borrower's option, either promptly repaid to Borrower or credited to Borrower on monthly payments of Funds. If the
amount of the Funds held by Lender is not sufficient to pay the escrow items w•hen due, Borrower shall pay to Lender an}•
amount necessary to make up the deficiency in one or more pa~~ments as required by Lender.
Upon payment in ful) of all sums secured by this Security Instrument, Lender shall promptl}~ retund to Borrower
any Funds held b~~ Lender. lf under paragraph 19 the Property is sold or acyuired b~• Lender. Lender shall apply, no later
than immediately prior tu the sale of the Property or its acquisition by Lender, an~• Funds held b}~ Lender at the time of
application as a credit against the sums secured by this Security Instrument.
3. Application ot Payments. Uniess applicable {aw provides otherw~ise, all payments recei~ed by- Lender under
paragraphs 1 and 2 shall be applied: first, to late charges due under the Note; second, to prepayment charges due under the
Note; third, ro amounts payable under paragraph 2; fourth, to interest due; and last, to principal due.
4. Charges; Liens. Borrower shall pay all taxes, assessments, charges, fines and impositions attributable tc~ the
Property which may attain priority over this Security lnstrument, and leasehold payments or ground rents, if any.
8orrower shall pay these obligations in the manner provided in paragraph 2, or if not paid in that manner, Borrow•er shall
pay them on time directly to the person owed payment. Borrower shall promptly~ furnish to Lender all notices of amounts
ro be paid under this paragraph. If Borcow•er makes these pa}•ments directly. Borrow~er shall promptly furnish ta Lender
receipts evidencing the payments.
Borrower shall promptly discharge an}~ lien u~hich has priority over this Security instrument unless Borrower. (a)
agrees in writing to the payment of the obligation secured by the lien in a manner acceptable to Lender, (b) contests in good
faith the lien by, or defends aga~nst enforcement of the lien in, legal proceedings w~hich in the Lender's opinion operate to
prevent the enforcement of the lien or forfeiture of any part of the Property; or (c) secures from the holder of the lien an
agreement satisfactory to Lender subordinating the lien to this Security Instrument. If Lender determines that an~~ part of
the Propert~~ is subject to a lien which may attain priorit~~ o~•er thic Securit}~ Instrument, Lender map gi~~e Borrow•er a
notice identifying the lien. Borrower shall satisfy the lien or take one or more <~f the actions tiet forth above w~ithin 10 days
of tne giving of notice.
5. Hazard Insurance. Borrow~er shall keep the im~ro~ements n<~~r existing or hereafter erected on the Propert;
insured against loss by fire, hazards included w~ithin the term "extended ro~•erage" and any other hazards for w hich Lender
requires insurance. This insurance shall bz maintained in the amountti and for the periods that Lender requires. The
insurance carrier pro~ iding the insurance shall be ch~~sen b~~ Bo~row~er subject t<~ Lender's approval w~hich shall not be
unreasonabl~• withheld.
All insurance policies and renew~als 6ha11 be acceptable t~ Lender and .h~il include a standard mortgage clause.
Lender shall have the right to hold the policies and renewals. If Lender reyuires, Borrower shall promptl~~ give to Lender
all receipts of paid premiums and renewal notices. In the event of I<~sti. Borrow~er shall give prompt notice to the insurance
carrier and Lender. Lender may make proof of Iess if not made promptl~~ b} Bvrrow~er.
E Unless Lender and Borrower otherw~ise agree in writing, insurance proceed` shall be applied to restoration or repair
! of the Propert}~ damaged, if the restoration or repair is economically feasible and Lender's security is not lessened. If the
~ restoration or repair is not economically feasible or Lender's securit}• would be lessened, the insurance proceeds shall be
~ applied to the sums secured by this Security Instrument, w~hether or not then due, with any excess paid to Borr~w•er. If
~ Borrow~er abandons the Propeny, or dces not answer w~ithin 30 days a notice from Lender that the insurance carrier has
: offered to settle a claim, then Lender ma}~ collect the insurance proceeds. Lender ma}~ use the proceeds to repair or restore
~ the Propert}~ or to pa}~ sums secured b~~ this Securit}~ Instrument, w•hether or not then due. The 30-day ~riod will begin
when the notice is gi~~en.
~ Unless Lender and Borrower otheru~ise agree in w~riting, any application of proceeds to principal shall not extend or
~ postpone the due date of the monthly pa}•ments referred to in paragraphs 1 and 2 or change the amount of the pa}'ments. If
under paragraph 19 the Property is acquired by Lender. Borrower's right to any~ insurance policies and proc:eeds resulting
~ from damage to the Property prior to the acquisition shall pass to Lender to the extent of the sums secured b}~ this Securit~~
~ Instrument immediately prior to the acquisition.
~ 6. Preservation and ~laintenance of Property; I.easeholds. Borrow~er shall not destroy~, damage or substantiall}~
~
~ change the Property, allow the Property to deteriorate or commit waste. If this Security Instrument is on a leasehold,
Borrower shall comply with the provisions of the lease, and if Borrower acquires fee title to the Propert}~. the leasehold and
~ fee title shail not merge un(ess Lerider agrees to the merger in writirg.
` 7. Protection of Lender's Rights in the Property; ~tortgage Insurance. If Borrow•er fails to perform the
~ covenants and agreements contained in this Security Instrument, or there i~ a legal proceeding that may significantl~• afi'ect
~ Lender's rights in the Property (such as a proceeding in bankruptcy, probate, for condemnation or to enforce law~s or
~ regulations), then Lender may do and pay for whatever is necessary to protect the ~~alue of tne Propertr• and Lender's rights
~ in the Pro rt Lender's actions ma include a in an sums secured by a lien w~hich has riorit over this Securit ~
F, ~ Y- Y P Y B Y P Y ~
~ Instrument, appearing in court, paying reasonable attorneys' fees and entering on the Property~ to make repairs. Although
~ Lender may take action under this paragraph 7, Lender does not have to do so.
~ Any amounts disbursed by Lender under this paragraph 7 shall become additional debt of Bormw~er secured b}• th+s
~ Security Instrument. Unless Borrower and Lender agree to other terms of pay~ment, these amounts shall bear interest from
~ the date of disbursement at the Note rate and shal! be pay~able, with interest, upon notice from Lender to Borrow~er
~ requesting payment.
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