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<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, asum ( "Funds ") equal toone•twelfth of:
<br />(a) yearly taxes and assessments whichmayattainpriorityoverthisSecurityInstrument;( b) yearlyleaseholdpaymentsorground
<br />rents on the Property, it any; (c)yearly hazard insurance premiums; and (d) yearly mortgage insurance premiums. if any. These
<br />items are called "escrow items." Lender may estimate the Funds due on the basis of current data and reasonable estimates of
<br />r future escrow items.
<br />I The Funds shall be held in an institution the deposits or accounts of which are insured or guaranteed by a federal or state
<br />agency (including Lender if Lender is such an institution). Lender shall apply the Funds to pay the escrow items. Lender may not
<br />charge for holding and applying the Funds, analyzing the account or verifying the escrow items, unless Lender pays Borrower
<br />intereston the Funds and applicable law permits Lender to make such a charge*. Borrower and Lender may agree in writing that
<br />interest shall be paid on the Funds. Unless an agreement is madeor applicable law requires interest to be paid, Lender shall not be
<br />required to pay Borrower any interest or earnings on the Funds. Lender shall give to Borrower, without charge, an annual
<br />accountingot the Funds showing credits and debits to the Funds and the purpose for which each debit to the Funds was made. The
<br />Funds are pledged as additional security for the sums secured by this Security Instrument.
<br />If the amount of the Funds held by Lender, together with the future monthly paymentsof Funds payable prior to the due dates
<br />of these escrow items, shall exceed the amount required to pay the escrow items when due, the excess shall be, at Borrower's .
<br />option, either promptly repaid to Borrower or credited to Borrower on monthly payments of Funds. If the amount of the Funds
<br />held by Lender is notsufficient to pay the escrow items when due, Borrower shall pay to Lender any amount necessary to make up
<br />the deficiency in one or more payments as required by Lender.
<br />Upon payment in full ofall sums secured by this Security Instrument, Lender shall promptly refund to Borrower any Funds
<br />held by Lender. If under paragraph 19 the Property is sold of acquired by Lender, Lender shall apply, no later than immediately
<br />E' prior tothe sale of the Property or its acquisition by Lender, any Funds held by Lender at the time of appl ieation as a creditagainst
<br />the sums secured by this Security Instrument.
<br />S. Application of Payments. Unless applicable law provides otherwise, all payments received by Lender under paragraphs
<br />1 and 2 shall be applied: first, to amounts payable under paragraph 2; second, to interest due; and last, to principal due.
<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 />writingto 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 1 ien in, legal proceedings which in the Lender's opinion operate to prevent the enforcement
<br />of the lien or forfeiture of any part of the Property: or (c) secures from the holder of the I ien an agreement satisfactory to Lender
<br />subordinating the lien to this Security Instrument. If Lender determines that any part of the Property is subject to a lien which
<br />may attain priority over this Security Instrument. Lender may give Borrower a notice identifying the lien: Borrower shall satisfy
<br />the lien or take one or more of the actions set forth above within 10 days of the giving of notice.
<br />5. 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 carrier
<br />providing the insurance shall he 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 shall
<br />have the right to hold the policies and renewals. If Lender requires. Borrower shall promptly give to Lender all receipts of paid
<br />premiums and renewal notices. In the event of loss. Borrower shall give prompt notice to the insurance carrier and Lender. Lender
<br />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 }u
<br />Property damaged, if the restoration or repair is economically feasible and Lenders 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 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 postpone
<br />the due date of the monthly payments referred to in paragraphs 1 and 2 or change the amount of the payments. If under paragraph
<br />19 the Property is acquired by Lender, Borrowers right to any insurance policies and proceedings resulting from damage to the
<br />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. Preservation and Maintenance 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 acquired fee title to the Property, the leasehold and fee title shall not
<br />merge unless Lender agrees to the merger in writing.
<br />7. - Protection 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 of regulations), then Lender may
<br />do and pay for whatever is necessary to protect the value of the Property and Lender's rights in the Property. Lender's actions may
<br />include paying any sums secured by a lien which has priority over this Security Instrument, appearing in court, paying
<br />reasonable attorney's fees and entering on the Property to make repairs. Although Lender may take action under this paragraph
<br />7, Lender does not have to do so.
<br />Any amounts disbursed by Lender under this paragraph 7 shall become additional debt of Borrower secured by this Security
<br />Instrument. Unless Borrower and Lender agree to other terms of payment. these amounts shall bear interest from the date of
<br />L disbursement at the Nate rate and shall be payable, with interest, upon notice from Lender to Borrower requesting payment.
<br />If Lender required mortgage insurance as a condition of making the loan secured by this Security Instrument, Borrower shall
<br />pay the premiums required to maintain the insurance in effect until such time as the requirement for the insurance terminates in
<br />accordance with Borrower's and Lender's written agreement or applicable law. Ito
<br />8. Inspections. Lander or its agent may make reasonable entries upon and inspections of the Property. Lender shall give
<br />Borrower notice at the time of or prior to an inspection specifying reasonable cause for the inspection.
<br />*A hag e a sessed'',, Lendder in c nclectivn with Iiorrowet's me in• int this security
<br />fns ruin nt 1'o a tF' cost of an indeIzendent. tax reporting: erV_ c}tihal� not be a charge
<br />Eor purposes o� be prec:e ing sentence. /1 )
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