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, . ` RE•RECORDED
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<br /> COVENANTS. Borrower and Lender covenant and agree as follows:
<br /> 1. Payment of Principal and In�; Prepayment and Iate (�arges. Bonower shall promptly pay when due the
<br /> principal of and interest on the debt evidenced by the Note and any prepayment and late charges due under the Note.
<br /> 2. Funds for Taxes and I�nsuca�e. Subject to applicable law or to a written waiver by Lender, Borrower shall
<br /> pay to Lender on the day monthly payments are due under the Note, until the Note is paid in full, a sum ("Funds")
<br /> for: (a) yearly taaes and assessments which may attain priority over this Security Instrument as a lien on the Property;
<br /> (b) yearly leasehold payments or ground rents on the Property, if any; (c) yearly hazard or property insurance
<br /> premiums; (d) yearly flood insurance premiums, if any; (e) yeazly mortgage insurance premiums, if any; and (fl any
<br /> sums payable by Bonower to Lender, in accordance with the provisions of paragraph 8, in lieu of the payment of
<br /> mortgage insurance premiums. These items aze called "Escrow Items." Lender may,at any time, collect and hold Funds
<br /> in an amount not to ezceed the maximum amount a lender for a federally related mortgage loan may require for
<br /> Borrower's escrow account under the federal Rea1 Estate Settlement Procedures Act of 1974 as amended from time
<br /> to time, 12 U.S.C.$2601 st sea. ("RESPA"), unless another law that applies to the Funds sets a lesser amount. If
<br /> so, Lender may, at any time, collect and hold Funds in an amount not to exceed the lesser amount. Lender may
<br /> estimate the amount of Punds due on the basis of current data and reasonable estimates of expenditures of future
<br /> Escrow Items or otherwise in accordance with applicable law.
<br /> The Funds shall be held in an insdtution whose deposits are insured by a federal 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
<br /> to pay the Escrow Items. Lender may not charge Borrower for holding and applying the Funds, annually analyzing
<br /> the escrow account, or verifying the Escrow Items, unless Lender pays Borrower interest on the Funds and applicable
<br /> law permits Lender to make such a charge. However, Lender may require Borrower to pay a one-time charge for an
<br /> independent real estate taa reporting service used by Lender in connection with this loan, unless applicable law
<br /> provides otherwise. Unless an agreement is made or applicable law requires interest to be paid, Lender shall not be
<br /> required to pay Bonower any interest or earnings on the Funds. Borrower and Lender may agree in writing,however,
<br /> that interest shall be paid on the Funds. Lender shall give to Borrower, without charge, an annual accounting of the
<br /> Funds, showing credits and debits to the Funds and the purpose for which each debit to the Funds was made. The
<br /> Funds are pledged as additional security for all sums secured by this Securiry Instrument.
<br /> If the Funds held by Lender exceed khe amounts permitted to be held by applicable law,Lender shall account to
<br /> Borrower for the excess Ifi�nds in accordance with the requirements of applicable law.If the amount of the Funds held
<br /> by Lender at any time is not sufficient to pay the Escrow Items when due, I.ender may so nokify Bonower in writing,
<br /> and, in such case Bonower shall pay to Lender the amount necessary to make up the deficiency. Bonower shall make
<br /> up the deficiency in no more than twelve monthly payments, at Lender's sole discretion.
<br /> Upon payment in full of all sums secured by this Securiry Instrument, Lender shall promptly refund to Bonower
<br /> any F�nds held by Lender. If, under paragraph 21, I.ender shall acquire or sell the Property, L.ender, prior to the
<br /> acquisition or sale of the Property, shall apply any Funds held by Lender at the time of acquisition or sale as a credit
<br /> against the sums secured by this Security Instrument.
<br /> 3. Application of Paym�ents. Unless applicable law provides okherwise, all payments received by Lender under
<br /> paragraphs 1 and 2 shall be applied in the following order: first, to any prepayment charges due under the Note;
<br /> second, to amounts payable under paragraph 2; klurd, to interest due; fourth, to principal due; and last, to any late
<br /> charges due under the Note.
<br /> 4. Charges; Liens. Borrower shall perform all of Bonower's obligadons under any mortgage, deed of trust or
<br /> other security agreement wikh a lien which has priority over this Security Instrument, including Borrower's covenants
<br /> to make payments when due. Any default by Borrower under any such mortgage, deed of trust or other security
<br /> agreement shall be a default under this Security Instrument and the Note. Borrower shall pay or cause to be paid all
<br /> t�es,assessments and other charges, fines and impositions attributable zo the Property which may attain a priority over
<br /> this Security Instrument, and leasehold payments or ground rents, if any. Bonower shall pay these obligations in the
<br /> manner provided in Paragraph 2,or,if not paid in that manner, Borrower shall pay them on time directly to the person
<br /> owed payment. Bonower shall promptly furnish to Lender all notices of amounts to be paid under this paragraph.
<br /> If Borrower makes these payments directly, Bonower shall promptly furnish to Lender receipts evidencing the
<br /> payments.
<br /> 5. HaTard or Pmpeity Insurance. Borrower shall keep the improvements now existing or hereafter erected on
<br /> the Property insured against loss by fire,hazards included within khe teim "extended coverage" and any other hazards,
<br /> including floods or flooding, for which Lender requires insurance. This insurance shall be maintained in the amounts
<br /> and for the periods that Lender requires. The insurance carrier providing khe insurance shall be chosen by Borrower
<br /> subject to Lender's approval which shall not be unreasonably withheld. If Bonower fails to maintain coverage described
<br /> above, Lender may,at Lender's option, obtain coverage to protect Lender's rights in the Property in accordance with
<br /> paragraph 7.
<br /> All insurance policies and renewals shall be acceptable to Lender and sha11 include a standard mortgage clause.
<br /> Lender shall have the right to hold the policies and renewals. If Lender requires, Borrower shall promptly give to
<br /> Lender all receipts of paid premiums and renewal notices. In the event of loss,Borrower shall give prompt notice to
<br /> the insurance carrier and Lender. Lender may make proof of loss if not made promptly by Borrower.
<br /> Unless Lender and Bonower otherwise agree in writing,any insurance proceeds sha11 be applied first to reimburse
<br /> Lender for costs and expenses incurred in connection with obtaining any such insurance proceeds, and then, at Lender's
<br /> option, in such order and proportion as it may determine in its sole and absolute discretion, and regazdless of any
<br /> impairment of security or lack thereof: (i) to the sums secured by this Security Instrument, whether or not then due,
<br /> and to such components thereof as Lender may determine in its sole and absolute discretion; andlor (ii) to Bonower
<br /> to pay the costs and eapenses of necessary repairs or restoration of the Property to a condition satisfactory to Lender.
<br /> If Bonower abandons the Property, or dces not answer witlun 30 days a notice from Lender that the insurance carrier
<br /> has offered to settle a claim, Lender may collect the insurance proceeds. Lender may, in its sole and absolute
<br /> discretion, and regardless of any impairment of security or lack thereof, use the proceeds to repair or restore the
<br /> Property or to pay the sums secured by this Security Instrument, whether or not then due. The 30-day period will
<br /> begin when the notice is given.
<br /> NF�R�sx� �rlto�s �v. o3i�
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<br /> Bonower Initials _ _
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