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93- 101401
<br />5, Hazard or Property 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 />Hoods or flooding, for which Lender requires insurance. Thic insurance shall be maintained in'the amounts and for the periods
<br />that Lender requires. The insurance carrier providing the insurance shall be chosen by Borrower subject to ;tinder's approval
<br />which shall not be unreasonably withheld. If Borrower fails to maintain coverage described above, Lender may, at Gender's
<br />option, obtain coverage to protect Lender's rights in the Property in accordance with paragraph 7.
<br />fl;; 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. If Lender requires, Borrower shall promptly give to Gender 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 otherwise agree in writing, insurance proceeds shall be applied to restoration or repair of the
<br />P,,.r - -tv damaged, if the restoration or repair is economically 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 Security Instrument, whether 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 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.;pp*ipal shall not extend or
<br />postpone the due date of the monthly payments referred to in paragraphs 1 and 2 or change the amount of the payments. If
<br />under paragraph 21 the Property is acquired by Lender, Borrower's right to any insurance policies and proceeds resulting from
<br />damage to the Property prior to the acquisition shall pass to Lender to the extent of the sums secured by this Security Instrument
<br />immediately prior to the acquisition.
<br />6. Occupancy, Preservation, Maintenance and Protection or the Property; Porrower's Loan Application; Leaseholds.
<br />Borrower shall occupy, establish, and use the Property as Borrower's principal residence within sixty days after the execution of
<br />this Security Instrument and shall continue to occupy the Property as Borrower's principal residence for at least one year after
<br />the date of occupancy, unless Lender otherwise agrees in writing, which consent shall not be unreasonably withheld, or unless
<br />extenuating circumstances exist which are beyond Borrower's control. Borrower shall not destroy, damage or impair the
<br />Property, allow the Property to deteriorate, or commit waste on the Property. Borrower shall be in default if any forfeiture
<br />action or proceeding, whether civil or criminal, is begun that in Lender's good faith judgment could.result in forfeiture of the
<br />Property or otherwise materially impair the lien created by this Security Instrument or Lender's security interest. Borrower may
<br />cure such a default and reinstate, as provided in paragraph 18, by causing the action or proceeding to be dismissed with a ruling
<br />that, in Lender's good faith determination, precludes forfeiture of the Borrower's interest in the Property or other material
<br />impairment of the lien created by this Security Instrument or Lender's security interest. Borrower shall also be in default if
<br />Borrower, during the !can application process, "gave materially false or inaccurate information or statements to Lender (or failed
<br />to provide Lender with any material information) in connection with the loan evidenced by the Note, including, but not limited
<br />to, representations concerning Borrower's occupancy of the Property as a principal residence. If this Security instrument is on a
<br />leasehold, Borrower shall comply with all the provisions 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 Borro -er fails to perform the covenants and agreements contained in
<br />this Security Instrument, or there is a legal proceeding that may significantly affect Lender's rights in the Property (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 whatever is necessary to protect the value of the Property and Lender's rights in the Property. Lender's actions may
<br />include paying any sums secured by a lier which has priority over this Security instrument, appearing in court, paying
<br />reasonable attorneys' fees and entering on the Property to make repairs. Although Lender may take action under this paragraph
<br />7, Lender does not have to do so.
<br />Arty 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 payment, these amounts -Jiall 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. Mortgage Insurance. If Lender required 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 required 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 litc
<br />cost to Borrower of the mortgage insurance previously in effect, from an alternate mortgage insurer approved by Lender. If
<br />substantially equivalent mortgage insurance coverage is not available, Borrower shall pay to Lender each month a sutra equal to
<br />one - twelfth of the yearly mortgage insurance premium being paid by Borrower when the insurance coverage lapsed or ceased to
<br />be in .rfect, Lender will accept, use and retain these payments as a loss reserve in lieu of mortgage insurance. loss reserve
<br />P"3oi6
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<br />Form 3028 8/80
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