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200411051
<br />BORROWER COVENANTS that Borrower is lawfully seised of the estate hereby conveyed and has the right to grant and convey the Property and that
<br />the Property is unencumbered, except for encumbrances of record. Borrower warrants and will defend generally the title to the Property against all claims
<br />and demands, subject to any encumbrances of record.
<br />Borrower and Lender covenant and agree as follows:
<br />1. Payment of Principal and Interest; Prepayment and Late Charges. Borrower shall promptly pay when due the principal of and interest on
<br />the debt evidenced by the Note and any prepayment and late charges due under the Note.
<br />2. Funds for Taxes and Insurance. At Lender's request and subject to applicable law, Borrower shall pay to Lender on the day monthly payments
<br />are due under the Note, until the Note is paid in full, a sum ( "Funds ") for: (a) yearly taxes and assessments which may attain priority over this Security
<br />Instrument as a lien on the Property; (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) yearly mortgage insurance premiums, if any; and (f) any sums payable by Borrower to Lender,
<br />in accordance with the provisions of paragraph 8, in lieu of the payment of mortgage insurance premiums. These items are called "Escrow Items." Lender
<br />may, at any time, collect and hold Funds in an amount not to exceed the maximum amount a lender for a federally related mortgage loan may require for
<br />Borrower's escrow account under the federal Real Estate Settlement Procedures Act of 1974 as amended from time to time, 12 U.S.C. § 2601 at seq.
<br />( "RESPA "), unless another applicable law that applies to the Funds sets a lesser amount. If so, Lender may, at any time, collect and hold Funds in an
<br />amount not to exceed the lesser amount. Lender may estimate the amount of Funds due on the basis of current data and reasonable estimates of
<br />expenditures of future Escrow Items or otherwise in accordance with applicable law.
<br />The Funds shall be held in an institution whose deposits are insured by a federal agency, instrumentality, or entity (including Lender, if Lender is such
<br />an institution) or in any Federal Home Loan 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 Borrower interest on the Funds and
<br />applicable law permits Lender to make such a charge. However, Lender may require Borrower to pay a one -time charge for an independent real estate tax
<br />reporting service used by Lender in connection with this loan, unless applicable law provides otherwise. Unless an agreement is made or applicable law
<br />requires interest to be paid, Lender shall not be required to pay Borrower any interest or earnings on the Funds. Borrower and Lender may agree in
<br />writing, however, that interest shall be paid on the Funds. Lender shall give to Borrower, without charge, an annual accounting of the Funds, showing
<br />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 all sums
<br />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 for the excess Funds in
<br />accordance with the requirements of applicable law. If the amount of the Funds held by Lender at any time is not sufficient to pay the Escrow Items when
<br />due, Lender may so notify Borrower in writing, and, in such case Borrower shall pay to Lender the amount necessary to make up the deficiency. Borrower
<br />shall make 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 Security Instrument, Lender shall promptly refund to Borrower any Funds held by Lender. If, under
<br />paragraph 21, Lender shall acquire or sell the Property, Lender, prior to the acquisition or sale of the Property, shall apply any Funds held by Lender at the
<br />time of acquisition 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 Lender under paragraphs 1 and 2 shall be
<br />applied: first, to any prepayment charges due under the Note; second, to amounts payable under paragraph 2; third, to interest due; fourth, to principal
<br />due; and last, to any late charges due under the Note.
<br />4. Charges; Liens. Borrower shall pay all taxes, assessments, charges, fines and impositions attributable to the Property which may attain priority
<br />over this Security Instrument, and leasehold payments or ground rents, if any. Borrower shall pay these obligations in the manner provided in paragraph 2,
<br />or if not paid in that manner, Borrower shall pay them on time directly to the person owed payment. Borrower shall promptly furnish to Lender all notices
<br />of amounts to be paid under this paragraph. If Borrower makes these payments directly, Borrower shall promptly furnish to Lender receipts evidencing the
<br />payments.
<br />Borrower shall promptly discharge any lien which has priority over this Security Instrument unless Borrower: (a) agrees in writing to the payment
<br />of the obligation 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,
<br />legal proceedings which in the Lender's opinion operate to prevent the enforcement of the lien; or (c) secures from the holder of the lien an agreement
<br />satisfactory to Lender subordinating the lien to this Security Instrument. If Lender determines that any part of the Property is subject to a lien which
<br />may attain priority over 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 />By initialing, I acknowledge this is page 2 of 6 /r1 rr y I( V
<br />of the Deed of Trust. Initials Initials Initials Initials
<br />© Copyright Compliance Systems, Inc. 1993, 1994, 1995, 1997, 1999 Compliance Systems, Inc.
<br />ITEM 121 NEL2 19902A1 Page 2 of 6 To Order: Call 800968.8522 Fax C16 956.1868
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