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U~IFORh1 Covt:NANI'~. I3urrawer and [.ender covenant and agrce as fifltcfws: '
~ 1, !'ayment of Principat and Interest; Prepayment and [.ate Charges. I3orrawcr shall promptly p~~y wn~~~ ~ue ~
the prinripal af and interest on ihe debt evidcnced by the Note and any pre}~ayment and late charges duc uncler the Notc. ~
l. Funds tor Taxes and Insurance. Subject tu applicable law or to a written H~aiver by l.ender, t3orrower shall pay ~
to Lender on the day monthly paymenls are due under the Note, until the Note is paid in full, a sum ("Funds") equal to
one-twelRh of: (a) yearly taxes and assessments which may atlain priority aver this Security Inslrument; (b) yearly
leasehold payments or ground rents on the Property, if any; (c) yearly hazard insurance premiums; and (d) ycarly
mortgage insurance prerniums, if any. "fhese items are caUed "escrow items." Lcnder may estimate the Funds due on thc
basis of current data and reasonable estimates of future escrow items.
'The Funds shall be held in an institution the deposits or accounts of which are insured or guaranteed by a federa! or
state agency (including Le~der if Lender is such an institution). Lende~ s1iaH apply the Funds !o pay the escro+v items.
~ Lender may not charge for holding and applying thc Funds, analyzing the account or verifying the escrow items, unless
Lender pays Qorro~ver interest on the Funds and ap~ficable law permits Lender to make such a charge. I3orro~ver and
Lender may agree in ~vriting that interest shall be paid on the Funds. Unless an agreement is made or applicable law~
' requires interest to be paid, l.ender shall not be required to pay I3orrower any interest or earnings on the Funds. Lender
shall give to Borrower, without charge, an annual accounting of the Funds shawirig 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 the sums secured by ~
this Security lnstruntent.
lf the amaunt of the F~nds held by I.ender, together with the Puture monthly payments of Funds payable prior to
the due datcs of the escrow items, shall exceed the amount required to pav the escrow items when due, the excess shall be,
at [~orrower's option, either promptly repaid to Borrower or credited to Borrower on monthly payments of F~nds. If'the
amaunt oP the Funds held by Lender is not sufllcient to pay the escruw items when due, IIorro~4~er shall pay to Lender any
amount necessary to make up the deficiency in one or more payments as required by Le~der.
Upon payment in Pull oP all sums secured by this Security Instrument, Lender shall propiptly refund to Dorra~ver
any Funds held by Lender. lf under paragraph 19 the Property is sold or acquired by Lender, Lender shall apply, no later
than immediately prior to the sale of'the Property or its acquisitipn by Lender, any Funds held by Lender at the time of ~
application as a credit against the sums secured by this Security Instrument.
3. ApPlieetion of Payments. Unless applicable law provides otherwise, all payme~ts recei~~ed by Lender u~ider
paragraphs 1 and 2 shall be applied: first, to late charges due under the Note; second, to prepayment chargcs duc under the
Note; third, to amounts payable under paragraph 2; fourth, to interest due; and (ast, to principal due.
4. Charges; I.iens. $orrower shall pay all taxes, assessments, charges, fines and impositions attributable to the
Property ~ti~hir.h may attain priority over this Security Instrumenl, and Icasehold payments or ground rents, if any.
E3orrower shall pay tt~ese obligations in the manner provided in paragraph 2, or if not paid in that manner, Borrower shall
pay them on time directly to the person ow•ed ~aS~ment. Barro~ver sha(( prom~?t!y furnish to Lender all notices of amounts
~ to be paid undcr this paragraph. If florrower makes these payments directly, Borrower shall promptly furnish to Lender
C receipts evidencing the payments.
~ Borrower shatt promptly discharge any lien ~vhich has priority over this Security Instrument unless Borrower: (a)
~ agrees in ~~~r+ting to the payment of the obligatian 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
f 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 suhordinating the lien to this Security instrurnent. If' Lender determines that any pan of
the Pro}~erty is subject to a lien which may~ attain priority over this Security Instrument, Lender may give f3urrower a
notice identifying the lien. F3orrower shaU satisfy the lien or take one or more of the actions set forth abo~~e within 10 days
of the giving of notice.
5. Hazard Insurance. I3orrower shall keep the improvements now existing or hereafter erected on th~ Yro~eriy
insured against loss by fire, hazards included within the term "extended coverage" and any other }~azards for which Lender
reyuires insurance. This insurance shall be niaintained in the amounts ancf For the ~riocis that Lender reyuires. The
insurance carrier providing the insurance shall be chosen by Boerower subject to Lender's approval which shall not be
unreasonably withheld.
Al) insurance policies and rene~~als shall be acceptable t~ Lender and shall incluJe a standard mo~tgage clause.
Lender shall have the right to hold the policies and renewals. If Lender requires, Borrower shall promptly gi~•e to Leiider
all receipts of paid premiums and renewal notices. In the event of loss, 13orrower shall give prompt notice to the insurance
~ carrier and Lender. Lender may make proof of loss if not made promptly by I3orrower.
Unless Lender and Eiorrower othenvise agree in writing, insurance proceeds shall be applied to resturation or repair
of the Property damaged, if the restoration or repair is economically feasible and Lender's sccurity is rtot lessened. If the
restoration or repair is not economically feasible or Lender's security woutd be tesseneci, the insuranee proceeds shall be
applied to the sums secured by this Security Instrument, whether or not then due, with any excess paid to Borrower. If ~
Sorrawer abandons the Propecty, or dces not answer within 30 days a notice from L.ender that the insurance carrier has
offered to settle a claim, then Lender may collect the insurance proceeds. Lender may use the proceeds ro repair or restore
the Property or to pay sums secured by this Security Instrument, whether or not then due. The 30-day perioci wiil begin
- when the notice is given.
Unlcss Lender and Borrower otherwise agree in writing, any application of proceeds to principal shall not extend or
postpone the due date of the monthly payn~ents referred to in paragraphs 1 and 2 or change the amount of the payments. If
under paragraph 19 the Property is acquired by Lender, Borrower's right to any insurance policies and pr~xeeds 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. Preservation and Maintenance of Property; I,Qaseholds. Borrower shall not destroy, damage or substantialiy `
change the Property, allow ihe Property ta deteriorate or commit waste. If this Security Instrument is on a leasehold,
F~ Borrower shall comply with the provisions of the lease, and if Borrower acquires fee title !o the Property, the leasehold and
~ fee title shall not merge unless Lender agrees to the merger in writing.
7. Protection of I,ender's Rights in the Property; l~iortgage Insurance. If I3orrower fails to perform the
~ covenants and agreements contained in this Security [nstrument, or there is a le~al proceeding that may significantly af~ect
Lender's rights in the Property (such as a proceeding in bankruptcy, probate, for condemnation or to enforce laws or
regulations), then Lender may do and pay for whatever is necessary to protect the value of the Property and Lender's rights
in the Property. Lender's actions may include paying any s~ms secured by a lien which has priority.over this Security
- Instrument, appcaring in court, paying reasonable attorneys' fees and entering on the Praperty to make repairs. Although
' Lender may take action under this paragraph 7, Lender dces not have to do so.
~ Any amaunts disbursed by Lender under this paragraph 7 shall become additional debt of Borrower secured by this
~ Security Instrument. Unless Borrower and I.ender agree to other terms of payment, these amounls shail bear interest from
the date of disbursement at the Note rate and shall be payable, with interest, upon notice from Let~der to Borrower
_ requesting payment.
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