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98-1(j4822
<br /> The Funds shall be held in an institution whose deposits are insured by a fecieral agency, instrumentality, or entity
<br /> �including Lender, if Lender is such an institution) or in any Federal Home Loan Bank. Lender shall apply the Funds to pay the
<br /> Escrow Items. Lender may not charge Borrower for holding and applying the Funds, annually analyzing the escrow account, or
<br /> verifying the Escrow Items, unless Lender pays Borrower interest on the Funds and applicable law permits Lender to make such
<br /> a charge. However, Lcnder may require Borrower to pay a one-time charge for an independent real estate tax reporting service
<br /> used by Lender in connection with this loan, unless applicable law provides otherwise. Unless an agreement is made or
<br /> applicable law requires interest to be paid, Lender shall not be required to pay Borrower any interest or earnings on the Funds.
<br /> Borrower and Lender may agree in writing, however, that interest shall be paid on the Funds. Lender shall give to Borrower,
<br /> without charge, an annual accountii�g of the Funds, showing credits and debits to the Funds and the purpose for which each
<br /> debi[ to the Funds was made. The Funds are pledged as additional security for all sums secured by this Security Instrument.
<br /> If the Funds held by Lender exceed the amounts permitted to be held by applicable law, Lender shall account to Borrower
<br /> for the excess Funds in accordance with the requirements of applicable law. If the amount of the Funds held by Lender at any
<br /> time is not sufficient to pay the Escrow Items when due, Lender may so notify Borrower in writing, and, in such case Borrower
<br /> shall pay to Lender the amount necessary to make up the deficiency. Borrower shall make up the deficiency in no more than
<br /> twelve monthly payments, at Lender's sole discretion.
<br /> Upon payment in full of all sums secured by this Security lnstrument, Lender shall promptly refund to Bormwer any
<br /> Funds held by Lender. If, under paragraph 21, Lender shall acquire or sell the Property, Lender, prior to the acquisition or sale
<br /> of the Property, shall apply any Funds held by Lender at the time of acquisition or sale as a credit against the sums secured by
<br /> this Security Instrument.
<br /> 3. Application of Payments. Unless applicable law provides otherwise, all payments received by Lender under paragraphs
<br /> 1 and 2 shall be applied: first, to any prepayment charges due under the Note; second, to amounts payable under paragraph 2;
<br /> third, to interest due; fourth, to principal due; and last, to any late charges due under the Note.
<br /> 4. Charges; Liens. Borrower shall pay all taxes, assessments, charges, fines and impc�sitions attributable to the Property
<br /> which may attain priority over this Security Instrument, and leasehold payments or ground rents, if any. Borrower shall pay
<br /> these obligations in the manner provided in paragraph 2, or if not paid in that manner, Borrower shall pay ihem on time directly
<br /> to the person owed payment. Borrower shall promptly furnish to Lender all notices of amounts to be paid under this paragraph.
<br /> If Borrower naakes these payments directly, Borrower shall promptly furnish to Lender receipts evidencing the payments.
<br /> Borrower shall promptly discharge any lien which has priority over this Security Instrument unless Borrower: (a) agrecs in
<br /> writing to the payment of the obligation secured by the lien in a manner aeceptable to Lender; (b) contests in g��od faith the lien
<br /> by, or defends against enforcement of the lien in, legal proceedings which in the Lender's opinicm operate to prevent the
<br /> enforcement of the lien; or (c) secures from the holder of the lien an agreement satisfactory to Lender subordinati��g the lien to
<br /> this Security Insh•ument. If Lender detennines that any part of the Property is subject to a lien which may a[tain priority over
<br /> this Security instrument, Lender may give Borrower a notice identifying the lien. Borrower shall satisfy the lien or take one or
<br /> more of the actions set forth above within 10 days of the giving of notice.
<br /> 5. Hazard or Propert,y Insurance. Borrower shall keep the improvements now existing or hereafter erected on the
<br /> Property insured against loss by fire, hazards included within the term "extended coverage" and any other hazards, including
<br /> floods or tlooding, for which Lender requires insurancc. This insurance shall be rnaintained in the amounts and for the periods
<br /> that Lender requires. The insurance carrier providing the insurance shall be chosen by Borrower subject to Lender's approval
<br /> �vhich shall not be unreasonably withheld. If Borrower fails to maintain coveragc described above, Lender may, at Lender's
<br /> option, obtain coverage to protect Lendet's rights in the Property in accordance with paragraph 7.
<br /> All insurance policies and renewals shall be acceptable to Lender and shall include a standard mortgage clause. Lender
<br /> shall have the right to hold the policies and renewals. Tf Lender requires, Borrower shall promptly give to Lender all receipts of
<br /> paid premiums and renewal notices. In the event of loss, Borrower shall give prompt notice to the insurance carrier and Lender.
<br /> Lender may make proof of loss if not made promptly by Borrower.
<br /> Unless Lender and Borrower otherwi�e agree in writing, insurance proceeds shall be applied to restc,ration or rep�iir ot�the
<br /> Property damaged, if the restoration or repair is eco►�omically feasible and Lender's security is not lessened. If the restoration or
<br /> repair is not economically feasible or Lender's security would be lessened, the insurance proceeds shall be applied to the sums
<br /> secured by this Securiry Instrument, wl�ether or not then due, with any excess paid to Borrower. If Borrower abandons the
<br /> Property, or does not answer within 30 days a notice from Lender that the insurance carrier has offered to settle a claim, then
<br /> Lender may collect the insurance proceeds. Lender may use the proceeds to repair or restore the Property or to pay sums
<br /> secured by this Security In�trument, tihether or not then due. The 30-day period will begin when the notice is given.
<br /> Unless Lender and Borrower otherwise agree in writing, any application of pr��ceedti to principal shall not exten� or
<br /> postpone the due date of the monthly payments refen•ed to in paragraphs I and 2 or change the anx�unt <�f the paymcnts. lf
<br /> under paragraph 2l the Property is acc�uired by Lender, Borrower's right to any insurance policies and proceecls resulting I�rom
<br /> damage to the Property prior to the acquisition shall pass to Lender to the extent oT the sums secured by d�is Security Instrument
<br /> immediately prior to the acyuisition.
<br /> 6. Occupancy, Preservation, Maintenance and Protection of the Property; Borro�ver's Loan Application; Leaseholds.
<br /> Borro��er shall occupy, establish, and use the Property as Borrower's principal residence within sixty d�rys al�ter the execution of
<br /> this Securit�� Instrument and shall continue to occupy the Property as Borrower's principal residence for at least one year after
<br /> the date uf occupancy, unless Lender otherwise agrees i❑ writing, which consent shalf not be unreasonably withheld, (�r unless
<br /> extenuating circumstances exist which are beyond Borrower's control. Borrower shall not destroy, damage or impair the
<br /> Property, allow the Properry to deteriorate, or commit waste on the Property. &�rrower sh�ill be in defautt if any forfeiture
<br /> action c�r proceeding, whether civil or criminal, is begun that in Lender's good faith jud`�ment could result in forfeiture of the
<br /> Property or otherwise materially itnpair the lien created by this Security Instr�ument or Lender's security interest. B��rrower may
<br /> cure such a default and reinstate, as provided in paragraph 18, by c:ausing the action or proceeding t� be disn�issed with a ruling
<br /> that, in Lender's good faith determination, precludes forfeiture of fhe Borrower's interest in the Property or other material
<br /> impairment of the lien create�l by this Security Instrument or Lender's security interest. Borrower shall also be in default if
<br /> Borrower, during the I�an application pr��cess, gave muterially fatse or inaccurate int'ormation �r statements t�> Lender (��r failed
<br /> ro provide Lender with anv material information) in connection with the loan evidencecl by the Note, inclucling, hut ni�t limited
<br /> t��, representations concerning Borrower's occupancy of the Properry as a principal residencc. If this Security lnstrument is on a
<br /> leasehold, Borrower shall comply with all the provisioi�s of the lease. If Borrower acquires fee title to the Property, the
<br /> leasehold and the fee title shall not merge unless Lender agrees to the merger in writing.
<br /> 7. Protection of Lender's Rights in the Property. If Borrower fails to perform the covenants and agreements contained in
<br /> this Security Instrument, ��r there is a legal proceeding that may significantly affect Lender's rightti in the Pr<�perty (such as a
<br /> proceeding in bankruptcy, probate, for condemnation or forfeiture or to enforce laws or regulations), then Lender may do and
<br /> pay for wh�tever is necessary to protect thc value of' the Property and Lender's rights in the Property. Lender's actions may
<br /> include paying any sums secured by a lien which has priorit�� ��ver this Security Instrumen[, appearing in c<�urt, paying
<br /> reasonable attorneys' fees and entering on the Property to make repairs. Althc�ugh Lender may take action under this paragraph
<br /> 7, Lender does not have to do so.
<br /> Any amounts disbursed by Lender under this paragraph 7 shall become additional debt of Borrower secured by this
<br /> Security Instrument. Unless Borrower and Lender agree to other terms of pay►nent, these ai��ounts shall bear interest from the
<br /> date of disbursement at the Note rate and shall be payable, with interest, upon notice from Lender to Borrower requesting
<br /> payment.
<br /> 8. hlortgage L�surance. IY Lender reyuired mortgage insurance as a condition of making the loan secured by this Security
<br /> Instrument, Borrower shall pay the premiums required to maintain the mortgage insurance in effect. If, for any reason, the
<br /> mortgage insurance coverage reyuired by Lender lapses or ceases to be in effect, Borrower shall pay the premiums required to
<br /> obtain coverage substantially equivalent to the mortgage insurance previously in effect, at a cost substantially equivalent to the
<br /> cost to Borrower of the mortgage insurance previously in effect, frotn an alterna[e mortgage insurer approved by Lender. If
<br /> Page 2 ot a Form 3028 9/90
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