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<br />UNIFORM COVENANTS, Borrowerand Lender covenant and agree as follows: 87- 10721 2
<br />1. Payment of Principal and Iqterest; Prepayment and Late Charges. Borrower shall promptly pay ~en due
<br />the principal of and interest on the debt evidenced by the Note and any prepayment and late charges due under the Note.
<br />2. FU,nds for Taxes and Insurance. Subject to applicable law or to a written waiver by Lender, Borrower shall pay
<br />to Lender on the day monthly payments are due under the Note, until the Note is paid in full. a sum ("Funds") equal to
<br />o,ne'twelfth of: (a) yearly laxes and assessments which may attain priority over this Security Instrument: (b) yearly
<br />leasehold payments or ground rents on the Property, if any; (c) yearly hazard insurance premiums: and (d) yearly
<br />mongage insurance premiums, if any. These items are called "escrow items." Lender may estimate the Funds due on the
<br />basis of current data and reasonable estimates offuture escrow items.
<br />The Funds shall be held in an institution the deposits or accounts ()fwhichare insured or guaranteed by a federal or
<br />stale agency (including Lender if Lender is such an instilution). Lender shall apply the Funds to pay the escrow ilems.
<br />Lender may not charge for holding and applying Ihe Funds, analyzing the account or-verifying the escrow items, unless
<br />Lender pays Borrower interest on the Funds and applicable law permits Lender to make such a charge. Borro\\'er and
<br />Lender may agree in writing that interest shall be paid on the Funds. 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 eamings on the Funds. Lender
<br />shall give to Borrower, without charge, an annual accounting of the Funds showing credits and debits to the Funds and the
<br />purpose for which each debit to the Funds was made. The Funds are pledged as additional security for the sums secured by
<br />this Security Instrument.
<br />If the amount of the Funds held by Lender, together with the future monthly payments of Funds payable prior to
<br />the due dates of the escrow items, shall exceed the amount required to pay the escrow items when due, the excess shall be,
<br />at Borrower's option, either promptly repaid to Borrower or c.-edited to Borrower on monthly payments of Funds. If the
<br />amount of the Funds held by Lender is not sufficient to pay the escrow items when due, Borrower shall pay to Lender any
<br />amount necessary to make up the deficiency in one or more payments as required by Lender.
<br />Upon payment in full of all sums seCured by this Securily InSlrumenl, Lender shall promptly refund 10 Borrower
<br />any Funds held by Lender: If under paragraph 19 the Property is sold or acquired by Lender, Lender shall apply, no later
<br />than immediately prior to the sale of the Propeny or its acquisition by Lender, any Funds held by Lender at the time of
<br />application as a credit against the sums secured by this Security Instrument.
<br />3. Application of Payments, Unless applicable law provides othen\'ise. all payments received by Lender under
<br />paragraphs I and 2 shall be applied: first, to late charges due under the Note: second, to prepayment charges due under the
<br />Note; third, to amounts payable under paragraph 2; founh, to interest due; and 13..\t, to principal due.
<br />4. Charges; Liens. Borrower shall pay all taxes, assessments. charges. fines and impositions attributable to the
<br />Propeny which may attain priority over this Security Instrument, and leasehold payments or ground rents. if any.
<br />Borrower shall pay these obligations in the manner provided in paragraph 2, l\r if not paid in that manner, Borrower shall
<br />pay them on time directly to the person owed paymen!. Borrower shall promptl~' furnish to Lender all notices of amounts
<br />to be paid under this paragraph. If Borrower makes these payments dir~'Ctly. Borrower shall promptly fumish to Lender
<br />receipts evidencing the payments.
<br />Borrower shall promptly discharge any lien which has priority OWl' this Security Instrument unless Borrower: (a)
<br />agrees in writing to the payment of the obligation secured by the lien in a manner a~'CCptable to Lender; (b) contests in good
<br />faith the lien by, or defends against enforcement of the lien in, legal procC\.'tIings which in the Lender's opinion operate to
<br />prevent the enforcement of the lien or forfeiture of any pan of the Propeny; (lr (c) secures from the holder of the lien :1Il
<br />agreement satisfactory to Lender subordinating the lien to this Security Instrument. If Lender determines that any pan of
<br />the Propeny is subject to a lien which may allain priority over this Security Instrument, lender may g!\'e Borrower a
<br />notice identifying the lien. Borrower shall satisfy the lien or take one or more of the actions set forth above within 10 days
<br />of the giving of notice.
<br />5, Hazard Insurance, Borrower shall keep the improvements now existing or hereafter erected on the Property
<br />insured against loss by fire, hazards included within the ternl "extended coverage" and an)' other hazards for which Lender
<br />requires insurance. This insurance shall be maintained in the amounts and for the periods that Lender requires. The
<br />insurance carrier providing the insurance shall be chosen by Borrower subject to Lender's approval which shall not be
<br />unreasonably withheld.
<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
<br />all receipts of paid premiums and renewal notices. In the event of loss. Borrower shall g!\'e prompt notice to the insuranl'e
<br />c;arrier and Lender. Lender may make proof ofloss ifnot made promptly by Borrower.
<br />Unless Lender and Borrower otherwise agree in writing, insurance proceeds shall be applil'tlto restoration or repair
<br />of the Propeny 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 Propeny, or does not answer "ithin 30 days a notice from lender that the insurance carrier has
<br />offerCd to sellle a claim, then Lender may collect the insurance proceeds. Lender may use the proceeds to repair or restore
<br />the Propeny or to pay sums secured by this Security Instrument, whether or not then due. The 30-day period will begin
<br />when the notice is given.
<br />Unless Lender and Borrower othen\'ise agree in writing, any application of proceeds to principal shall not extend or
<br />postpQne the due date of the monthly payments referred to in paragraphs I and 2 or change the amount of the payments. If
<br />under paragraph 19 the Property is acquired by Lender, Borrower's right to any insurance policies and proceeds resulting
<br />from damage to the Propeny prior to the acquisition shall pass to Lender to the extent of the sums secured by this Security
<br />Instrument immediateI)' prior to the acquisition.
<br />6, Preservation and Maintenance of Property; Leaseholds. Borrower shall not destroy, damage or substantially
<br />change the Property, allow the Propeny to deteriorate or commit waste. If this Security Instrument is on a leasehold,
<br />Borrower shall com pi)' with the provisions of the lease, and if Borrower acquires fee title to the Property. the leasehold and
<br />fee title shall not merge unless Lender agrees to the merger in writing.
<br />7. Protection of Lender's Rights in the Property; Mortgage Insurance. If Borrower fails t,o pcrfornl the
<br />covenants and agreements contained in this Securily Instrument, or there is a legal pnxeeding that may significantly alr~'Ct
<br />Lender's rights in the Propeny (such as a proceeding in bankruptcy, probate, for condemnation or to enforce laws or
<br />regulations), then Lender may do and pay for whatever is necessary to protectlhe value of the Property and Lender's rights
<br />in the Property. Lender's actions may include paying any sums secured by a lien which has priority over this S~'Curity
<br />Instrument, appearing in court, paying reasonable attorneys' fees and entering on the l'ropert)'>to make repairs. Although
<br />Lender may take action under this paragraph 7, Lender does nol have to do so,
<br />Any amounts disbursed by Lender under this paragraph 7 shall become additionalllebt of Borrower secured by this
<br />Security Instrument. Unless Borrower and Lender agree to other terms of paymelll. these amounts shall bear illlerest fwm
<br />the date of disbursement al the Note rate and shall be payable. wilh interest. upon notice fwm Lender 10 Borrower
<br />requestirig paymen!.
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