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200411630
<br />All insurance policies and renewals shall be acceptable to Lender and shall 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 Lender all
<br />receipts of paid premiums and renewal notices. In the event of loss, Borrower shall give prompt notice to the insurance
<br />carrier and Lender. 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
<br />the Property damaged, if the restoration or repair is economically feasible and Lender's security is not lessened. If the
<br />restoration or repair is not economically feasible or Lender's security would be lessened, the insurance proceeds shall be
<br />applied to the sums secured by this Security Instrument, whether or not then due, with any excess paid to Borrower. If
<br />Borrower abandons the Property, or does not answer within 30 days a notice from Lender that the insurance carrier has
<br />offered to settle a claim, then Lender may collect the insurance proceeds. Lender may use the proceeds to repair or restore the
<br />Property or to pay sums secured by this Security Instrument, whether or not then due. The 30 -day period will begin when the
<br />notice is given.
<br />Unless Lender and Borrower otherwise agree in writing, any application of proceeds to principal 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
<br />from damage to the Property prior to the acquisition shall pass to Lender to the extent of the sums secured by this Security
<br />Instrument immediately prior to the acquisition.
<br />6. Occupancy, Preservation, Maintenance and Protection of the Property; Borrower's Loan Application;
<br />Leaseholds. Borrower shall occupy, establish, and use the Property as Borrower's principal residence within sixty days after
<br />the execution of this Security Instrument and shall continue to occupy the Property as Borrower's principal residence for at
<br />least one year after the date of occupancy, unless Lender otherwise agrees in writing, which consent shall not be
<br />unreasonably withheld, or unless extenuating circumstances exist which are beyond Borrower's control. Borrower shall not
<br />destroy, damage or impair the Property, allow the Property to deteriorate, or commit waste on the Property. Borrower shall
<br />be in default if any forfeiture action or proceeding, whether civil or criminal, is begun that in Lender's good faith judgment
<br />could result in forfeiture of the Property or otherwise materially impair the lien created by this Security Instrument or
<br />Lender's security interest. Borrower may cure such a default and reinstate, as provided in paragraph I$, by causing the action
<br />or proceeding to be dismissed with a ruling that, in Lender's good faith determination, precludes forfeiture of the Borrower's
<br />interest in the Property or other material impairment of the lien created by this Security Instrument or Lender's security
<br />interest. Borrower shall also be in default if Borrower, during the loan application process, gave materially false or inaccurate
<br />information or statements to Lender (or failed to provide Lender with any material information) in connection with the loan
<br />evidenced by the Note, including, but not limited to, representations concerning Borrower's occupancy of the Property as a
<br />principal residence. If this Security Instrument is on a leasehold, Borrower shall comply with all the provisions of the lease.
<br />If Borrower acquires fee title to the Property, the leasehold and the fee title shall not merge unless Lender agrees to the
<br />merger in writing.
<br />7. Protection of Lender's Rights in the Property. If Borrower fails to perform the covenants and agreements
<br />contained in this Security Instrument, or there is a legal proceeding that may significantly affect Lender's rights in the
<br />Property (such as a proceeding in bankruptcy, probate, for condemnation or forfeiture or to enforce laws or regulations), then
<br />Lender may do and pay for whatever is necessary to protect the value of the Property and Lender's rights in the Property.
<br />Lender's actions may include paying any sums secured by a lien which has priority over this Security Instrument, appearing
<br />in court, paying reasonable attorneys' fees and entering on the Property to make repairs. Although Lender may take action
<br />under this paragraph 7, Lender does not have to do so.
<br />Any 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 shall 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
<br />Security Instrument, Borrower shall pay the premiums required to maintain the mortgage insurance in effect. If, for any
<br />reason, the mortgage insurance coverage required by Lender lapses or ceases to be in effect, Borrower shall pay the
<br />premiums required to obtain coverage substantially equivalent to the mortgage insurance previously in effect, at a cost
<br />substantially equivalent to the cost to Borrower of the mortgage insurance previously in effect, from an alternate mortgage
<br />insurer approved by Lender. If substantially equivalent mortgage insurance coverage is not available, Borrower shall pay to
<br />Lender each month a sum equal to one - twelfth of the yearly mortgage insurance premium being paid by Borrower when the
<br />insurance coverage lapsed or ceased to be in effect. Lender will accept, use and retain these payments as a loss reserve in lieu
<br />of mortgage insurance. Loss reserve payments may no longer be required, at the option of Lender, if mortgage insurance
<br />coverage (in the amount and for the period that Lender requires) provided by an insurer approved by Lender again becomes
<br />available and is obtained. Borrower shall pay the premiums required to maintain mortgage insurance in effect, or to provide a
<br />loss reserve, until the requirement for mortgage insurance ends in accordance with any written agreement between Borrower
<br />and Lender or applicable law.
<br />Page 3 of 7 NE- 2040 -W4
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