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200411280
<br />Borrower and Lender covenant and agree as follows:
<br />1. PAYMENT OF PRINCIPAL AND INTEREST. Borrower shall promptly pay when due the
<br />Principal of and Interest on the indebtedness evidenced by the Note, and all prepayment and late charges as
<br />provided in the Note or in this Security Instrument.
<br />2. FUNDS FOR TAXES AND INSURANCE. Subject to applicable law or to a written waiver
<br />by Lender, Borrower shall pay to Lender on each Due Date under the Note, until the Note is paid in full, a
<br />sum (herein "Funds ") equal to one - twelfth of the yearly taxes and assessments which may attain priority
<br />over this Security Instrument, and ground rents on the Property, if any, plus one - twelfth of yearly premium
<br />installments for the insurance required to be maintained pursuant hereto, all as reasonably estimated
<br />initially and from time to time by Lender on the basis of assessments and bills or other reasonable estimates
<br />thereof.
<br />The Funds shall be held by Lender and commingled with the Lender's other funds and, further,
<br />Lender shall not be liable to Borrower for interest on such Funds. Lender shall apply the Funds to pay said
<br />taxes, assessments, insurance premiums and ground rents. The Funds are pledged as additional security for
<br />the sums secured by this Security Instrument.
<br />If at any point during the term hereof, the amount of the Funds held by Lender shall exceed the
<br />amount required to pay the taxes, assessments, insurance premiums and ground rents as they fall due
<br />during the next consecutive twelve -month period, such excess shall be, at Borrower's option, either
<br />promptly repaid to Borrower or credited to Borrower on future monthly payments of Funds. If the amount
<br />of the Funds held by Lender shall not be sufficient to pay taxes, assessments, insurance premiums, and
<br />ground rents as they fall due during the next consecutive twelve -month period, Borrower shall pay to
<br />Lender any amount necessary to make up the deficiency within thirty (30) days from the date notice is
<br />mailed by Lender to Borrower requesting payment thereof.
<br />Upon payment in full of all sums secured by this Security Instrument, Lender shall promptly
<br />refund to Borrower any Funds held by Lender. If under Paragraph 23 herein the Property is sold or the
<br />Property is otherwise acquired by Lender, Lender shall apply, no later than immediately prior to the sale of
<br />the Property or its acquisition by Lender, any Funds held by Lender at the time of application as a credit
<br />against the sums secured by this Security Instrument.
<br />3. APPLICATION OF PAYMENTS. Unless applicable law provides otherwise, all payments
<br />received by Lender under the Note and Paragraphs 1 and 2 hereof shall be applied by Lender (i) first to
<br />interest payable on the Note, (ii) then in payment of amounts payable to Lender by Borrower under
<br />Paragraph 2 hereof, and (iii) then to the Principal of the Note.
<br />4. CHARGES; LIENS. Borrower shall pay all taxes, assessments and other charges, fines and
<br />impositions attributable to the Property which may attain a priority over this Security Instrument, and
<br />leasehold payments or ground rents, if any, in the manner provided under Paragraph 2 hereof, or, if not
<br />paid in such mariner, by Borrower making payment, when due, directly to the payee thereof. Borrower
<br />shall promptly furnish to Lender all notices of amounts due under this paragraph, and in the event
<br />Borrower shall make payments directly, Borrower shall promptly furnish to Lender receipts evidencing
<br />such payments. Borrower shall promptly discharge any lien which has priority over this Security
<br />Instrument; provided, that Borrower shall not be required to discharge any such lien so long as Borrower
<br />shall agree in writing to the payment of the obligation secured by such lien in a manner acceptable to
<br />Lender, or shall in good faith contest such lien by, or defend such enforcement of such lien in, legal
<br />proceedings which operate to prevent the enforcement of the lien or forfeiture of the Property or any part
<br />thereof.
<br />5. INSURANCE COVERAGES. Borrower shall keep the improvements now existing or
<br />hereafter erected on the Property insured against loss by fire, hazards included within the term "extended
<br />coverage ", and such other hazards as Lender may require, in an amount equal to the full replacement value
<br />of the improvements (80% co- insurance clause permitted), as established by a competent insurance
<br />appraiser. Comprehensive general public liability insurance will also be obtained, with a company
<br />acceptable to the Lender, for an amount not less than $1,000,000.00 combined single limit. Rental value
<br />insurance equal to the rental value for a twelve month period, as established by a competent insurance
<br />appraiser, shall also be carried throughout the term of the loan. The Property, if located in a 100 -year
<br />flood plain, shall also be covered, for the term of the loan, by flood insurance in an amount at least equal to
<br />the outstanding principal balance of the loan, or the maximum limit of coverage made available with
<br />respect to this particular type of property, whichever is less.
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