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<br />UN1F-_R t COVENANTS. Borrower and Lender cover-ant and agree as follow :
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<br />1. Payment or Pdadpal and Interest; Prepayment and Late Charges. Borrower shall promptly pay when due the
<br />principal of and interest on the debt evidenced by the Note and any pspayment and late charges due under the Note. i
<br />2. Funds for Taxes and Insurance. Subject to applicable law or to a written waiver by Lender, Borrower shall pay to
<br />Lender on the day monthly payments are due under the Note, until the Note is paid in full, a sum ( "Funds ") equal to One-
<br />twelfth of: (a) yearly taxes and assessments which may attain priority over this Security Instrument; (b) yearly teasehold
<br />payments or ground rents on the Property, if any; (c) yearly hazard insurance premiums; and (d) yearly mortgage insurance
<br />premitms, if any. These items are tailed "escrow items." Lender may estimate the Funds due on the basis of current data
<br />and reasonable estimates of future escrow items.
<br />The Funds shall be held in an institution the deposits or accounts of which are insured or guaranteed by a federal or
<br />state agency (including Lender if Lender is such an institution). Lender shall apply the Funds to pay the escrow items. Lender
<br />may not charge for holding and applying the Funds, analyzing the account or verifying the escrow items, unless Lender pays
<br />Borrower interest on the Funds and applicable law permits Lender to snake such a charge. Borrower and Lender may agree in
<br />writing that interest shall be paid on the Funds. Unless an agreement is made or applicable law requires interest to be paid,
<br />Lender shall not be required to pay Borrower any interest or earnings on the Funds. Lender shall give to Borrower, without
<br />charge, an annual accounting of the Funds showing credits and debits to the Funds and the purpose for which each debit to
<br />the Funds was made. The Funds are pledged as additional security for the sums secured by this Security Instrument.
<br />r If the amount of the Funds held by Lender, together with the future monthly payments of Funds payable prior to the
<br />° due dates of the escrow items, shall exceed the amount required to pay the escrow items when due, the excess shall be, at
<br />Borrower's option, either promptly repaid to Borrower or credited on monthly payments of Funds. If the amount of the
<br />Funds held by Lender is not sufficient to pay the escrow items when due, Borrower shall pay to Lender any amount
<br />necessary to make up the deficiency in one or ,: gre na,,nents as required by Lender.
<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 19 the Property is sold or acquired by Lender, Lender shall apply, no later than
<br />immediately prior to the sale of the Property 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 otherwise, 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; fourth, to interest due; and last, to principal due.
<br />a. Charges; Liens. Borrower shall pay all taxes, assessments. charges, fines and impositions attributable to the
<br />Property which may attain priority over this Security Instrument, and leasehold payments or ground rents, if any. Borrower
<br />shall pay these obligations in the manner provided in paragraph 2, or if not paid in that manner, Borrower shall pay them on
<br />time directly to the person owed payment. Borrower shall promptly furnish to Lender all notices of amounts to be paid under
<br />this paragraph. If Borrower makes these payments directly, Borrower shall promptly furnish to Lender receipts evidencing the
<br />payments. - --
<br />Borrower shall promptly discharge any Gen which has priority over this Security Instrument unless Borrower: (a) agrees
<br />in writing to the payment of the obligation secured by the lien in a manner acceptable to Lender; (b) contests in good faith
<br />the Gen by, or defends against enforcement of the lien in, legal proceedings which in the Lender's opinion operate to prn--ent
<br />the enforcement of the Gen of forfeiture of any part of the Property; or (c) secures from the holder of the lien an agreement
<br />satisfactory to Lender subordinating the lien to this Security Instrument. If Lender determines that any part of the Property is
<br />subject to a Gen which may attain priority over this Security Instrument, Lender may give Borrower a notice identifying the
<br />Gen. Borrower shall satisfy the lien or take one or more of the actions set forth above within 10 days of the giving of notice
<br />S. Hazard Insurance. Borrower shall keep the improvements now existing or hereafter erected on the Property insured
<br />against loss by fire, hazards included within the term "extended coverage" and any other hazards for which Lender requires
<br />insurance. This insurance shall be maintained in the amounts and for the periods that Lender requires. The insurance carries
<br />providing the insurance shall be chosen by Borrower subject to Lender's approval which shall not be unreasonably withheld_
<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 aIl receipts
<br />of paid premiums and renewal notices. In the event of loss. Borrower shall give prompt notice to the insurance carrier and
<br />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 Iessened. If the
<br />restoration or repair is not cconomicalty feasible or Lender's security would be lessened, the insurance proceeds shall be
<br />applied to the sum 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 collet- the insurance proceeds. Lender may use the proceeds to repair or restore
<br />the Property or to pay sums secured by this Security Instrument, whether or not then due. The 30-day period will begin when
<br />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 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 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- — Mvervation and Nsatateasace of Property; Leaseholds. Borrower shall not destroy, damage or substantially change _
<br />the Property, allow the Property to deteriorate or commit waste. If this Security Instrument is on a leasehold, Borrower shall
<br />comply with the provisions of the lease, and if Borrower acquires fee title to the Property, the leasehold and fee title shall not
<br />merge unless Lender agrees to the merger in writing.
<br />7. PrOU0100 of Lender's Rights in the Property; Mortgage Insurance. If Borrower fails to perform the covenants and
<br />agreements contained in this Security Instrument, or there is a legal proceeding that may significantly affect Lender's rights in
<br />the Property (such as a proceeding in bankruptcy, probate, for condemnation or to enforce laws or regulations), then Lender
<br />may do and pay for whatever is necessary to protect the value of the Property and Lender's rights in the Property. Lender's t
<br />L actions may include paying any sums secured by a lien which has priority over this Security Instrument, appearing in court,
<br />paying reasonable attorney's fees and entering on the Property to make repairs. Although Lender may take action under this
<br />,paragraph 7 Lender does not have to do so. Any amounts disbursed by Lender under this paragraph 7 shall become
<br />additional debt of Borrower secured by this Security Instrument. Unless Borrower and Lender agree to other terms of
<br />Payment, these amounts shall bear interest from the date of disbursement at the Note rate and shall be payable, with interest,
<br />upon notice from Lender to Borrower requesting payment. a
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