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<br />a federally related mortgage loan may require for Borrower's escrow account under the federal Real Estate
<br />Settlement Procedures Act of 1974 as amended from time to time, 12 U.S.C. Section 2601 et seq. ("RESPA"),
<br />unless another law that applies to the Funds sets a lesser amount. If so, Lender may, at any time, collect and
<br />hold Funds in an amount not to exceed the lesser amount. Lender may estimate the amount of Funds due on
<br />the basis of current data and reasonable estimates of expenditures of future Escrow Items or otherwise in
<br />accordance with applicable law.
<br />The Funds shall be held in an institution whose deposits are insured by a federal agency,
<br />instrumentality, or entity (including Lender, if Lender is such an institution) or in any Federal Home Loan
<br />Bank. Lender shall apply the Funds to pay the Escrow Items. Lender may not charge Borrower for holding and
<br />applying the Funds, annually analyzing the escrow account, or verifying the Escrow Items, unless Lender pays
<br />Borrower interest on the Funds and applicable law permits Lender to make such a charge. However, Lender
<br />may require Borrower to pay a one-time charge for an independent real estate tax reporting service used by
<br />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
<br />earnings on the Funds. Borrower and Lender may agree in writing, however, that interest shall be paid on the
<br />Funds. Lender shall give to Borrower, without charge, an annual accounting of the Funds, showing credits and
<br />debits to the Funds and the purpose for which each debit to the Funds was made. The Funds are pledged as
<br />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
<br />account to Borrower for the excess Funds in accordance with the requirements of applicable law. If the amount
<br />of the Funds held by Lender at any time is not sufficient to pay the Escrow Items when due, Lender may so
<br />notify Borrower in writing, and, in such case Borrower shall pay to Lender the amount necessary to make up
<br />the deficiency. Borrower shall make up the deficiency in no more than twelve monthly payments, at Lender's
<br />sole discretion.
<br />Upon payment in full of all sums secured by this Security Instrument, Lender shall promptly refund to
<br />Borrower any Funds held by Lender. If, under paragraph 21, Lender shall acquire or sell the Property, Lender,
<br />prior to the acquisition or sale of the Property, shall apply any Funds held by Lender at the time of acquisition
<br />or sale as a credit against the sums secured by this Security Instrument.
<br />3. Application of Payments. Unless applicable law provides otherwise, all payments received by
<br />Lender under paragraphs 1 and 2 shall be applied: first, to any prepayment charges due under the Note; second,
<br />to amounts payable under paragraph 2; third, to interest due; fourth, to principal due; and last, to any late
<br />charges due under the Note.
<br />4. Charges; Liens. Borrower shall pay all taxes, assessments, charges, fines and impositions
<br />attributable to the Property which may attain priority over this Security Instrument, and leasehold payments or
<br />ground rents, if any. Borrower shall pay these obligations in the manner provided in paragraph 2, or if not paid
<br />in that manner, Borrower shall pay them on time directly to the person owned payment. Borrower shall
<br />promptly furnish to Lender all notices of amounts to be paid under this paragraph. If Borrower makes these
<br />payments directly, Borrower shall promptly furnish to Lender all notices of amounts to be paid under this
<br />paragraph. If Borrower makes these payments directly, Borrower shall promptly furnish to Lender receipts
<br />evidencing the payments.
<br />Borrower shall promptly discharge any lien which has priority over this Security Instrument unless
<br />Borrower: (a) agrees in writing to the payment of the obligation secured by the lien in a manner acceptable to
<br />Lender; (b) contests in good faith the lien by, or defends against enforcement of the lien in, legal proceedings
<br />which in the Lender's opinion operate to prevent the enforcement of the lien; or (c) secures from the holder of
<br />the lien an agreement satisfactory to Lender subordinating the lien to this Security Instrument. If Lender
<br />determines that any part of the Property is subject to a lien which may attain priority over this Security
<br />Instrument, Lender may give Borrower a notice identifying the lien. Borrower shall satisfy the lien or take one
<br />or more of the actions set forth above within 10 days of the giving of notice.
<br />5. Hazard or Property Insurance. Borrower shall keep the improvements now existing or hereafter
<br />erected on the Property insured against loss by fire, hazards included within the term "extended coverage" and
<br />any other hazards, including floods or flooding, for which Lender requires insurance. This insurance shall be
<br />maintained in the amounts and for the periods that Lender requires. The insurance carrier providing the
<br />insurance shall be chosen by Borrower subject to Lender's approval which shall not be unreasonably withheld.
<br />If Borrower fails to maintain coverage described above, Lender may, at Lender's option, obtain coverage to
<br />protect Lender'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
<br />mortgage clause. Lender shall have the right to hold the policies and renewals. If Lender requires, Borrower
<br />shall promptly give to Lender all receipts of paid premiums and renewal notices. In the event of loss, Borrower
<br />shall give prompt notice to the insurance carrier and Lender. Lender may make proof of loss if not made
<br />promptly by Borrower.
<br />Unless Lender and Borrower otherwise agree in writing, insurance proceeds shall be applied to
<br />restoration or repair of the Property damaged, if the restoration or repair is economically feasible and Lender's
<br />security is not lessened. If the restoration or repair is not economically feasible or Lender's security would be
<br />lessened, the insurance proceeds shall be applied to the sums secured by this Security Instrument, whether or
<br />not then due, with any excess paid to Borrower. If Borrower abandons the Property, or does not answer within
<br />30 days a notice from Lender that the insurance carrier has offered to settle a claim, then Lender may collect
<br />the insurance proceeds. Lender may use the proceeds to repair or restore the Property or to pay sums secured
<br />by this Security Instrument, whether 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 proceeds to principal shall
<br />not extend or postpone the due date of the monthly payments referred to in paragraphs 1 and 2 or change the
<br />amount of the payments. If under paragraph 21 the Property is acquired by Lender, Borrower's right to any
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