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<br />be paid on such insurance proceeds, Lender shall not be required to pay Borrower any interest or earnings on
<br />such proceeds. Fees for public adjusters, or other third parties, retained by Borrower shall not be paid out of the
<br />insurance proceeds and shall be the sole obligation of Borrower. If the restoration or repair is not economically
<br />feasible or Lender's security would be lessened, the insurance proceeds shall be applied to the sums secured by
<br />this Security Instrument, whether or not then due, with the excess, if any, paid to Borrower. Such insurance
<br />proceeds shall be applied in the order provided for in Section 2.
<br />If Borrower abandons the Property, Lender may file, negotiate and settle any available insurance claim
<br />and related matters. If Borrower does not respond within 30 days to a notice from Lender that the insurance
<br />carrier has offered to settle a claim, then Lender may negotiate and settle the claim. The 30 -day period will
<br />begin when the notice is given. In either event, or if Lender acquires the Property under Section 22 or otherwise,
<br />Borrower hereby assigns to Lender (a) Borrowers rights to any insurance proceeds in an amount not to exceed
<br />the amounts unpaid under the Note or this Security Instrument, and (b) any other of Borrower's rights (other than
<br />the right to any refund of unearned premiums paid by Borrower) under all insurance policies covering the
<br />Property, insofar as such rights are applicable to the coverage of the Property. Lender may use the insurance
<br />proceeds either to repair or restore the Property or to pay amounts unpaid under the Note or this Security
<br />Instrument, whether or not then due.
<br />6. Occupancy. Borrower shall occupy, establish, and use the Property as Borrower's principal
<br />residence within sixty days after the execution of this Security Instrument and shall continue to occupy the
<br />Property as Borrowers principal residence for at least one year after the date of occupancy, unless Lender
<br />otherwise agrees in writing, which consent shall not be unreasonably withheld, or unless extenuating
<br />circumstances exist which are beyond Borrower's control.
<br />7. Preservation, Maintenance and Protection of the Property; Inspections. Borrower shall not destroy,
<br />damage or impair the Property, allow the Property to deteriorate or commit waste on the Property. Whether or
<br />not Borrower is residing in the Property, Borrower shall maintain the Property in order to prevent the Property
<br />from deteriorating or decreasing in value due to its condition. Unless it is determined pursuant to Section 5 that
<br />repair or restoration is not economically feasible, Borrower shall promptly repair the Property if damaged to avoid
<br />further deterioration or damage. If insurance or condemnation proceeds are paid in connection with damage to,
<br />or the taking of, the Property, Borrower shall be responsible for repairing or restoring the Property only if Lender
<br />has released proceeds for such purposes. Lender may disburse proceeds for the repairs and restoration in a
<br />single payment or in a series of progress payments as the work is completed. If the insurance or condemnation
<br />proceeds are not sufficient to repair or restore the Property, Borrower is not relieved of Borrower's obligation for
<br />the completion of such repair or restoration.
<br />Lender or its agent may make reasonable entries upon and inspections of the Property. If it has
<br />reasonable cause, Lender may inspect the interior of the improvements on the Property. Lender shall give
<br />Borrower notice at the time of or prior to such an interior inspection specifying such reasonable cause.
<br />8. Borrower's Loan Application. Borrower shall be in default if, during the Loan application process,
<br />Borrower or any persons or entities acting at the direction of Borrower or with Borrower's knowledge or consent
<br />gave materially false, misleading, or inaccurate information or statements to Lender (or failed to provide Lender
<br />with material information) in connection with the Loan. Material representations include, but are not limited to,
<br />representations concerning Borrower's occupancy of the Property as Borrowers principal residence.
<br />9. Protection of Lender's Interest in the Property and Rights Under this Security Instrument. If (a)
<br />Borrower fails to perform the covenants and agreements contained in this Security Instrument, (b) there is a
<br />legal proceeding that might significantly affect Lenders interest in the Property and /or rights under this Security
<br />Instrument (such as a proceeding in bankruptcy, probate, for condemnation or forfeiture, for enforcement of a
<br />lien which may attain priority over this Security Instrument or to enforce laws or regulations), or (c) Borrower has
<br />abandoned the Property, then Lender may do and pay for whatever is reasonable or appropriate to protect
<br />Lender's interest in the Property and rights under this Security Instrument, including protecting and /or assessing
<br />the value of the Property, and securing and /or repairing the Property. Lenders actions can include, but are not
<br />limited to: (a) paying any sums secured by a lien which has priority over this Security Instrument; (b) appearing in
<br />court; and (c) paying reasonable attorneys' fees to protect its interest in the Property and /or rights under this
<br />Security Instrument, including its secured position in a bankruptcy proceeding. Securing the Property includes,
<br />but is not limited to, entering the Property to make repairs, change locks, replace or board up doors and
<br />windows, drain water from pipes, eliminate building or other code violations or dangerous conditions, and have
<br />utilities turned on or off. Although Lender may take action under this Section 9, Lender does not have to do so
<br />and is not under any duty or obligation to do so. It is agreed that Lender incurs no liability for not taking any or all
<br />actions authorized under this Section 9.
<br />Any amounts disbursed by Lender under this Section 9 shall become additional debt of Borrower
<br />secured by this Security Instrument. These amounts shall bear interest at the Note rate from the date of
<br />disbursement and shall be payable, with such interest, upon notice from Lender to Borrower requesting
<br />payment.
<br />If this Security Instrument is on a leasehold, Borrower shall comply with all the provisions of the lease. If
<br />Borrower acquires fee title to the Property, the leasehold and the fee title shall not merge unless Lender agrees
<br />to the merger in writing.
<br />NEd&Sd Single Famdly— F.,ni.Me/F,eddk Mac UNIPORMINSTRUMF.NT MERSMudMd F- 30281N1
<br />R03 -511
<br />(Page 5 of 10 Pages)
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