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UNIFORM CovEt~~VTS. B~rrower and Lcnder cove~ant and agreeas follows: ;
l. Payment ot Principal and Interest; Prepaymeat and Late C6irges. Borrower shall promptly pay when due
the principal of and interest on the dcbt evidenccd by the Note and any prepayment and late charga due under the Note.
2. Funds (or Tuss and lnsunace. Subject to applicable law or to a writte~ waiver by L,ender, Borrower shal! pay
to l.ender on the day monthly payments are due under the Note, unti! the Note is paid in full, a sum ("Funds") cqual to
one•twelRh of: (a) yearly taxes and assessmenis which may aitain priority over this Security Instrument; (b) yearly
leaschold payments or ground rents on the Property, if any; (c) yearly hazard insurance premiums; and ~~~riy
mortgage insurance premiums, if any. These items are called "escrow it~ms." l.ender may estimate thc Funds due on the
basis of current data and rcasonable estimates of future escrow items.
The Funds shall be htld in an institution the deposits or accounts of which arc insured or guarantecd by a frdecal or
state agency (inctuding Lender if Ltnder is such an institution). Lender shall apply the Funds to pay the rscrow items.
l.eader may not charge for holding ar~d applying the Funds, analyzing the account or veritying th~ escrow items, unicss
• l.endet pays Borrower interest on the Funds and applicable law permits L,ender 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 ~ paid, L.tnder shall not be required to pay Borcower any inierest or earnings on the Funds. Lender
' shall give to Borrower, without charge, an annual accounting of the Funds showing credits and debits to th~ Funds and the
purpose for which each debit to the Funds was made. The Funds are pledged as additional security for the sums secured by
this Security Instrument.
If the amount of the Funds held by Lxnder, together with the future monthty payments of Funds payable prior to
the due dates of the escraw items, shall exceed the amount required to pay the escrow itcros whtn due, tne ezcess shall be,
at Borrower's option, either promptly repaid to Borrower or credited to Borrower on monthly payments of Funds. If the
amount of tht Funds held by I.~nder is not suti'icient to pay the escrow items when due, Borrower shail pay to Lender any
amount necasary to make up the deficiency in one or more payments as required by Lender.
Upon payment in full of ali sums secured by this Security Instrument, Lender shall promptiy refund to Borrower
any Funds held by L.ender. If under paragraph 19 the Property is sold or acqu~red by lxnder, Lender shall apply, no fater
than immediately prior to the salt of the Property or its acquisition by I.ender, any Funds held by L,endcr at the time of
application as a credit against the sums secured by this Security lnstrument.
3, Applicstion of Payments. Uniess applicable law provides otherwise, all payments received 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, to amounts payable under paragraph 2; fourth, to interest due; and last, to Qrincipal ~ue.
4, Charges; Liens. Borrower shall pay all taxes, assessmtnts, charges, fines and impositions attributable to the
Properiy which may attain ,priority over this Security Instrument, and leasehold payments or ground rents, if any.
Borrower shall pay these obligations in the manner provided in paragraph 2, or if not paid in that manner, Borrower shalt
pay them on time directly to the person owed payment. Borrower shall promptty turnish to Lender ati notices of amounts
to be paid ~nder this paragraph. If Bonower makes these payments directly, Borrower shall promptly furnisn to Lender
receipts evidencing the pay^~ents_
Borrower shall promptly discharge any lien which h~~ 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 against enforcement of the lien in, legal proceedings which in the Lender's opinion operate to
prevent the enforcemeni 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 th~ lien to this Security Instrument. If Lender determines that any part of
the Properly is sub,ject to a lien which may attain priority over this Security Instrument, Lender may give Borrower a
notice identifying ihe lien. Borrower shall satisfy the lien or take one or more of the actions set torth above within 10 days
of the giving of notice,
5, . Hazard Insurance. Borrower ~hail keep the improvements now existing or hereafter erected oa~ the Property
insured against loss by fire, hazards included withiR ihe term "extended coverage" and any other hazards for which Lender
requires ins~rance. This insurance shall be maintained in the amounts and for the periocls that Lender requires. The
insurance carrier providing the insurance shafl be chosen by Borrower subject to Lender's approval which shall not be
unreasonably withheld.
All insurance policies and renewals shall be acceptabte to L,ender and shall include a standard mortgage clause.
Lender shalt have the right to hold the policies and renewals. If Lender requires. Borrower shall promptly give to Lender
all receipts of paid premiums and renewal notices. In the event of loss, Borrower shall give prompt notice to the insurance
carrier and I.ender. I.ender may make proof of loss if not made promptly by Borrower.
Uniess Lender and Borrower otherwise agree in writing, insurance proceeds shall be applied to restoration or repair
of the Property damaged, if the restoration or repair is economicaliy feasible and Lender's security is not lessened. If the
restoration or repair is not economically feasibie or Lender's security would be lessened, the insurance proceeds shali be
applied to the sums secured by this Security Instrument, whether or not then due, with any excess pai~ to Borrower. If
Borrower abandons the Property, or dces not answer within 30 days a notice from Lender that the insurance carrier has
offered to settle a claim, then I.ender may colleet the insurance pra:eeds. Lender may use the proceeds to repair or restore
the Property or to pay sums secured by this Security Instrument, whether or not then due. The 30-day period wil! begin
when the notice is given.
Unless Lender and Borrower otherwise agree in writing, any application of proceeds to principal shall not extend or
~?os?pone the due date of the monthly payments referred to in paragraphs 1 and 2 or change t~?e amount of the payments. If
under paragraph 19 the Property is acquired by Lender, Borrower's right to any insurance poticies and proceeds resulting
from damage to the Property prior to the acquisition shall pass to Lender to the extent of the sums secured by this Security
Instrument immediately prior to the acquisition.
6. Prrservatioe and Maintenance of Property; Lesseholds. Borrower shall not destroy, damage or substantiaUy
change the Property, allow the Properiy to deteriorate or commit waste. If this Security Ir~strument is on a leasehold,
Borrower shail comply with the provisions of the teast, and if Borrower acquires fee title to the Property, the leasehold and
fee title shall not merge unless I.ender agree.c to the merg~r in writing.
'I. Protection ot Lender's Rights in t6e Property; Mortgage Insurance. If Borrower fails to perfarr ~ the
covenants and agreements ~ontained in this Security Instrument, or there is a legal proceeding that may significantly aH'ect
I,ender's rights in the Property (such as a proceeding in bankruptcy, probate, for condemnation or to enforce laws or
regulations), then I.ender may do and pay for whatever is necessary to prottct the value of the Property and Lender's rights
in thz Property. Lender's actions may include paying any sums secured by a lien which has priority over this Security
Instrument, appearing in court, paying reasonable attorneys' fees and er~tering on the Property to make repairs. Although
Gender may take action under this paragraph 7, Lender doa not have to do so.
Any amounts disbursed by Lender under this paragraph 7 shall become additional debt of Borrower secured by this
Security Instrument. Ur.less Borrower and Lender agree to other terms of payment, these amounts shall b~ar interest from
the dat~ of disbursement at the Note rate and shall be payable, with interest, upon notice from Lender t~ Borrower
requesting payment.
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