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20020'1651
<br />mortgage loan may require for Borrower's escrow account under the federal Real Estate Settlement Procedures Act of 1974 as
<br />,intended from time to time, 12 U.S.C. SS 2601 et seq. ( "RESPA "), unless another law that applies to the Funds sets a lesser
<br />amount. If so, Lender may, at any time, collect and hold funds in an amount not to exceed the lesser amount. Lender may estimate
<br />the amount of Funds due on the basis of current data and reasonable estimates of expenditures of future Escrow Items or otherwise
<br />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
<br />Lender, if Lender is such an institution) or in any Federal Home Loan Bank. Lender shall apply the Funds to pay the Escrow
<br />Items. Lender may not charge Borrower for holding and applying the Funds, annually analyzing the escrow account, or verifying
<br />the Escrow items, unless Lender pays Borrower interest on the Funds, annually analyzing the escrow account, or verifying the
<br />Escrow Items, unless Lender pays Borrower interest on the Funds and applicable law permits Lender to make such a charge.
<br />However, Lender may require Borrower to pay a one -time charge for an independent real estate tax reporting service used by
<br />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
<br />Lender may agree in writing, however, that interest shall be paid on the Funds. Lender shall give to Borrower, without charge, an
<br />annual accounting of the funds, showing credits and debits to the funds and the purpose for which each debit to the funds was
<br />made. The funds are pledged as additional security for all sums 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
<br />for the excess funds in accordance with the requirements of applicable law. If the amount of the funds held by Lender at any time
<br />is not sufficient to pay the Escrow Items when due, Lender may so notify Borrower in writing, and, in such case Borrower shall
<br />pay to Lender the amount necessary to make up the deficiency. Borrower shall make up the deficiency in no more than twelve
<br />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
<br />Funds held by Lender. If, under paragraph 21, Lender shall acquire or sell the Property, Lender, prior to the acquisition or sale of
<br />the Property, shall apply any funds held by Lender at the time of acquisition or sale as a credit against the sums secured by this
<br />Security Instrument.
<br />3. Application of Payments. Unless applicable law provides otherwise, all payments received by Lender under paragraphs
<br />I and 2 shall be applied: first, to any prepayment charges due under the Note; second, to amounts payable under paragraph 2; third,
<br />to interest due; fourth, to principal 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
<br />which may attain priority over this Security Instrument, and leasehold payments or ground rents, if any. Borrower shall pay these
<br />obligations in the manner provided in paragraph 2, or if not paid in that manner, Borrower shall pay them on time directly to the
<br />person owed payment. Borrower shall promptly furnish to Lender all notices of amounts to be paid under this paragraph. If
<br />Borrower makes these payments directly, Borrower shall promptly furnish to Lender receipts evidencing the payments.
<br />Borrower shall promptly discharge any lien which has priority over this Security Instrument unless Borrower: (a) agrees in
<br />writing to the payment of the obligation secured by the lien in a manner acceptable to Lender; (b) contests in good faith the lien by,
<br />or defends against enforcement of the lien in, legal proceeding which in the Lender's opinion operate to prevent the enforcement of
<br />the lien; or (c) secures from the holder of the lien an agreement satisfactory to Lender subordinating the lien to this Security
<br />Instrument. If Lender determines that any part of the Property is subject to a lien which may attain priority over this Security
<br />Instrument, Lender may give Borrower a notice identifying the lien. Borrower shall satisfy the lien or take one or more of the
<br />actions set forth above within 10 days of the giving of notice.
<br />5. Hazard or Property Insurance. Borrower shall keep the improvements now existing or hereafter erected on the
<br />Property insured against loss by fire, hazards included within the term "extended coverage" and any other hazards, including floods
<br />or flooding, for which Lender requires insurance. This insurance shall be maintained in the amounts and for the periods that
<br />Lender requires. The insurance carrier providing the insurance shall be chosen by Borrower subject to Lender's approval which
<br />shall not be unreasonably withheld. If Borrower fails to maintain coverage described above, Lender may, at Lender's option,
<br />obtain coverage to protect Lender's rights in the Property in accordance with paragraph 7.
<br />All insurance policies and renewals shall be acceptable to Lender and shall include a standard mortgage clause. Lender
<br />shall have the right to hold the policies and renewals. If Lender requires, Borrower shall promptly give to Lender all receipts of
<br />paid premiums and renewal notices. in the event of loss, Borrower shall give prompt notice to the insurance carrier and Lender.
<br />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 the
<br />Property damaged, if the restoration or repair is economically feasible and Lender's security is not lessened. If the restoration or
<br />repair is not economically feasible or Lender's security would be lessened, the insurance proceeds shall be applied to the sums
<br />secured by this Security Instrument, whether or not then due, with any excess paid to the Borrower. If Borrower abandons the
<br />Property, or does not answer within 30 days a notice from Lender that the insurance carrier has offered to settle a claim, then
<br />Lender may collect the insurance proceeds. Lender may use the proceeds to repair or restore the Property or to pay sums secured
<br />by this Security Instrument, whether or not then due. The 30 day period will begin when the 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 under
<br />paragraph 21 the Property is acquired by Lender, Borrower's right to any insurance policies and proceeds resulting from damage to
<br />the Property prior to the acquisition shall pass to Lender to the extent of the sums secured by this Security Instrument immediately
<br />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 the
<br />execution of this Security instrument and shall continue to occupy the Property as Borrower's principal residence for at least one
<br />year after the date of occupancy, unless Lender otherwise agrees in writing, which consent shall not be unreasonably withheld, or
<br />unless extenuating circumstances exist which are beyond Borrower's control. Borrower shall not destroy, damage or impair the
<br />Property, allow the Property to deteriorate, or commit waste on the Property. Borrower shall be in default if any forfeiture action
<br />or proceeding, whether civil or criminal, is begun that in Lender's good faith judgment could result in forfeiture of the property or
<br />otherwise materially impair the lien created by this Security Instrument or Lender's security interest. Borrower may cure such a
<br />default and reinstate, as provided in paragraph 18, by causing the action or proceeding to be dismissed with a ruling that, in
<br />NERRAS'KA- Single Family - Fannie Mae /Freddie Mac UMFORM INSTRUMENT Fonn 3028 9190 (page 2 of 5 pages)
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