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Lender pays 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, Lender shall riot be required 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 in 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 sold 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 Payments. 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 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 />4. 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 promptly 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; (b) contests in good
<br />faith the lien by, or defends against enforcement of the lien m, legal proceedings which in the Lender's opinion 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 give 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 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 give prompt notice to the insurance
<br />carrier and 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
<br />of the Property 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 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 Property 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 otherwise agree in writing, any application of proceeds to principal shall riot 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
<br />under paragraph l9 the Property is acquired by Lender, Borrower's right to any insurance policies and proceeds resulting
<br />from damage to the Property prior ro the acquisition shall pass to Lender io 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 substantially
<br />change the Property, allow the Property to deteriorate or commit waste. If this Security Instrument is nn a ieasehold.
<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 .ignifcantly atrect
<br />Lender's rights m the Property (such as a proceeding in hankruptcy, probate, for condemnation or to enforce laws or
<br />regulations), then Lender may do and pay for whatever is necessary to protect the valtie of the Property and Lender's nahts
<br />in the Property. Lender's actions may include paving any sums secured by a ben which has rrionty oser this Security
<br />Instrument, appearing in court, paying reasonable attorneys' fees and entering on the Property to make repairs Although
<br />Lender rnav take action under this paragraph 7. Lender does not have to do so
<br />Any amounts dishur'sed by Lender ender this paragraph 7 shall hecome additional debt ,,f Borrower secured by this
<br />Security Instrument Unless Borrower and Lender agree to other terms k,f ravniena. these MM-Irs shrill hear interest frotn
<br />the date of dishurscment at the Note rate and shall he payanle, with in!erest, upon notice Iron I ender m Borro%%cr
<br />requesting payment.
<br />If Lender required mortgage insurance as a condition of maKing rile loan secured by this security Instrument.
<br />Borrower shall pay the premiums required to maintain the insurance in etfect unto such eime as the requirement for the
<br />nsurance terminates in accordance with Borrower's and Lender's written agreement or applicable law
<br />R. inspection, i.ender or Its agent may make reasonable entries upon and u»pections of the Property Lender
<br />,hail give Borrower notice at the time of or prior to an nlspectum specifying ieasonable cause for the uispecnun
<br />9. Condemnation. the proceeds of ativ award or clairn for damages. direct or consequential, in connection with
<br />:any , ondemnation or ,xher taking of any pain r >f the Property, or for conveyance ut lieu of , ondenination, ,ire heret,s '
<br />,aasogned Srld shall be paid to Lender
<br />ta't f
<br />Ito the event of a Imal taking of the Property. the ;jra•eeds shall Lr arrhed ro tae sums •.ecuietl kv this �ecunt,
<br />Insrs.uiieai!, whether „r riot then Joe, with any excess pail r,i Nori,wrr In :he e,cnr „I .i ;,art;,il :.akuiti „1 the I'iorerr:
<br />oleos lkrr,•,evrr ,Ind i r rider „therwlse agrr,r in wriung, Ihr .urrl,. aecured by Sits `rrcurity I list rr„nenl t'lail the (educed I„
<br />Pie :usi,nrnt ,f the pry, a_et`', multiplied f,y the ',rhowrnf: 1'ra,:ttrai ;,u the ! ,lei arnouni . , tie sums ,ecurr,t ;rnineiitairl,
<br />°t "• :r ,.lk ng. „•. ,icd l;v rho tfir fair rnarkrt •.ahir ut ifir Prnrer ; rninrrui,ri,•i, hrl t: the- i,iAure 1!.: r,aLur„ hail
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