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Lender pars Borrower interest on the Funds and applicable law permits Lender to make such a charge. Borrower 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, Leader shall not be requited to pay Borrower any interest or earnings 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 credited 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 to one or more payments as required by Lender.
<br />Upon payment in full of all sums secured by this Security Instrument, Lender shall promptly refund to Borrower
<br />any Funds held by Lender. if under paragraph 19 the Property is soid or acquired by Lender. Lender shall apply, no later
<br />than 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 Paytneats. Unless applicable law provides otherwise, all payments received by Lender under
<br />paragraphs 1 and 2 shall be applied: first, to late charges due under the Vote; second, to prepayment charges due under the
<br />'.Vote, third. to amounts pavable under paragraph 2; fourth, to interest due: and last, to principal due.
<br />3 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.
<br />Borrower shall pay these obligations in the manner provided in paragraph 2. or if not paid in that manner. Borrower shall
<br />pay them on time directly to the person owed payment. Borrower shall promptly furnish to Lender all notices of amounts
<br />to be paid under this paragraph. If Borrower makes these payments directly. Borrower shall promptiv furnish to Lender
<br />receipts evidencing the payments.
<br />Borrower shall promptly discharge any lien which has priority over this Security instrument unless Borrower: (a)
<br />agrees in writing to the payment of the obligation secured by the lien in a manner acceptable to Lender, i b i contests in good
<br />faith the lien by. or defends against enforcement of the lien in, legal proceedings which in the Lenders option operate to
<br />prevent the enforcement of the lien or forfeiture of any part of the Property; or (c) secures from the holder of the lien an
<br />agreement satisfactory to Lender subordinating the lien to this Security Instrument. If Lender determines that any part of
<br />the Property is subject to a lien which may attain priority over this Security Instrument, Lender may grog 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 />S. 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 term "extended coverage" and any other hazards 'or which Lender
<br />requires insurance. This insurance shall he maintained in the amounts and for the periods that Lender .requires. The
<br />insurance carrier providing the insurance shall be chosen b% Borrower subject to Lender's approval which shall not be,
<br />unreasonabiy withheld.
<br />All insurance policies and renewa s 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 gne prompt nonce to the insurance
<br />earner and Lender. Lender may make proof of loss if not made promptly b% Borrou er.
<br />Unless Lender and Borrower otherwise agree in writing, insurance proceeds shall be applied to restoration or repair
<br />of the Property damaged, if the restoration or repair is economically feasible and Lenders security is not lessened. if the
<br />restoration or repair is not economica lily feasible or Lender's security would be lessened, the insurance proceeds shall be
<br />applied io the sums 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 collect the insurance proceeds. Lender may use the proceeds to repair or restore
<br />the Propene or to pay sums secured by this Secunt_v Instrument, whether or not :hen due T re C-das period will begin
<br />when the notict is given. -
<br />Unless Lender and Borrower oche. -wise agree in wnting, any application of proce_ds to principal shall not extend or
<br />postpone the due date of the monthly payments referred to in paragraphs 1 and _' ar �harr_e the amount of the payments. If
<br />under paragraph to the Proper-,v 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. Preservation and Maintenance of Property; Leaseholds. Borrower shall not destroy. damage or substantialiy
<br />change the Property, allow the Property to deteriorate or commit waste. If this Security Instrument is on a leasehold,
<br />Borrower shall comply 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 to perform the
<br />covenants and agreements contained in this Security Instrument. or there is a legal proceeding that may significantly affect
<br />Lender's rights in the Property isuch 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 protect the value of the Property and Lender', rizhis
<br />in the Property. Lender's actions may include paying any sums secured b% a lien which has pncri :p otter this Security
<br />Instrument, appeanng in court. paying reasonable attorneys' fees and entering on the Property to make repairs Although
<br />Lender may take action under this paragraph 7. Lender does not have to do s,,
<br />Any amounts disbursed by Lender under this paragraph 7 shall become additional dent _s Borrower secured n� :.. ^.a
<br />Security Instrument. Unless Borrower and Lender agree to other terms of payment, these arr.uun,is shall bear interest inn
<br />the date of disbursement at the Note rate and shall t>e payable. with Interest. upon n.ouce ;Ton; Lender io Horrower
<br />requesting payment.
<br />If Lender required mortgage insurance as a condition of making ttie loan secured by this Security Instrument,
<br />Borrower shall pay the premiums required to maintain the insurance in effect until such time as the requirement for :re
<br />insurance ierminairs in accordance with Borrower's and Lender's written agreement or applicable law.
<br />S. Inspection. Lender or :is agent may make reasonable entries upon and inspections o :he Proper -% Lende-
<br />,hail give Borrower n=otice at the time of or prior to an inspection spec:fymg reasonable cause for the inspection.
<br />9. Condemnation. The proceeds of any award or claim for damages, direct or consequential, to connection ,viii
<br />any condemnation ?r other taking Jan) pan of the Properi,. or for conveyance in lieu of can +emnanor., are hear,
<br />assigned and shall t)e paid io Lender
<br />in the event 4 a total taK:ne the Pronenv, the prxeeds .hjli e „pF lied ,.n}; r;•,j
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