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200306392
<br />Borrower and Lender covenant and agree as follows:
<br />1. PAYMENT OF PRINCIPAL AND INTEREST. Borrower shall promptly pay
<br />when due the Principal of and Interest on the indebtedness evidenced by the Note, and all
<br />prepayment and late charges as provided in the Note or in this Deed of Trust.
<br />2. FUNDS FOR TAXES AND INSURANCE. Subject to applicable law or to a written
<br />waiver by Lender, Borrower shall pay to Lender on each Due Date under the Note, until the Note
<br />is paid in full, a sum (herein "Funds ") equal to one - twelfth of the yearly taxes and assessments
<br />which may attain priority over this Deed of Trust, and ground rents on the Property, if any, plus
<br />one - twelfth of yearly premium installments for the insurance required to be maintained pursuant
<br />hereto, all as reasonably estimated initially and from time to time by Lender on the basis of
<br />assessments and bills or other reasonable estimates thereof.
<br />The Funds shall be held by Lender and commingled with the Lender's other funds and,
<br />further, Lender shall not be liable to Borrower for interest on such Funds. Lender shall apply the
<br />Funds to pay said taxes, assessments, insurance premiums and ground rents. The Funds are
<br />pledged as additional security for the sums secured by this Deed of Trust.
<br />If at any point during the term hereof, the amount of the Funds held by Lender shall
<br />exceed the amount required to pay the taxes, assessments, insurance premiums and ground rents
<br />as they fall due during the next consecutive twelve -month period, such excess shall be, at
<br />Borrower's option, either promptly repaid to Borrower or credited to Borrower on future monthly
<br />payments of Funds. If the amount of the Funds held by Lender shall not be sufficient to pay taxes,
<br />assessments, insurance premiums, and ground rents as they fall due during the next consecutive
<br />twelve -month period, Borrower shall pay to Lender any amount necessary to make up the
<br />deficiency within thirty (30) days from the date notice is mailed by Lender to Borrower requesting
<br />payment thereof.
<br />Upon payment in full of all sums secured by this Deed of Trust, Lender shall promptly
<br />refund to Borrower any Funds held by Lender. If under Paragraph 23 herein the Property is sold
<br />or the Property is otherwise acquired by Lender, Lender shall apply, no later than immediately
<br />prior to the sale of the Property or its acquisition by Lender, any Funds held by Lender at the time
<br />of application as a credit against the sums secured by this Deed of Trust.
<br />3. APPLICATION OF PAYMENTS. Unless applicable law provides otherwise, all
<br />payments received by Lender under the Note and Paragraphs I and 2 hereof shall be applied by
<br />Lender (i) first to interest payable on the Note, (ii) then in payment of amounts payable to Lender
<br />by Borrower under 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,
<br />fines and impositions attributable to the Property which may attain a priority over this Deed of
<br />Trust, and leasehold payments or ground rents, if any, in the manner provided under Paragraph 2
<br />hereof, or, if not paid in such manner, by Borrower making payment, when due, directly to the
<br />payee thereof. Borrower shall promptly furnish to Lender all notices of amounts due under this
<br />paragraph, and in the event Borrower shall make payments directly, Borrower shall promptly
<br />furnish to Lender receipts evidencing such payments. Borrower shall promptly discharge any lien
<br />which has priority over this Deed of Trust; provided, that Borrower shall not be required to
<br />discharge any such lien so long as Borrower shall agree in writing to the payment of the obligation
<br />secured by such lien in a manner acceptable to Lender, or shall in good faith contest such lien by,
<br />or defend such enforcement of such lien in, legal proceedings which operate to prevent the
<br />enforcement of the lien or forfeiture of the Property or any part thereof.
<br />5. INSURANCE COVERAGES. Borrower shall keep the improvements now existing
<br />or hereafter erected on the Property insured against loss by fire, hazards included within the term
<br />"extended coverage ", and such other hazards as Lender may require, in an amount equal to the
<br />full replacement value of the improvements (80% co- insurance clause permitted), as established
<br />by a competent insurance appraiser. Comprehensive general public liability insurance will also be
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