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2 �110���9 <br />'t'he Funds shall be held in an institution whose deposits are insured by a federal agency, instnunentality, or entity <br />(including Lender, if Lender is such an institution) or in any Federal Home Loan Bank. Lender shall apply the <br />Funds to pay the Escrow Items. Lender may not charge Borrower for holding and applying the Funds, annually <br />analyzing the escrow account, or verifying the Escrow Items, unless Lender pays Borrower interest on the Funds <br />and Applicable Law permits Lender to make such a charge. However, Lender may require Borrower to pay a one- <br />time charge far an independent real estate tax reporting service used by Lender in connection with this loan, unless <br />Applicable Law provides otherwise. 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. Borrower and Lender may <br />agree in writing, however, that interest shall be paid on the Funds. Lender shall give to Borrower, without charge, <br />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 all suxns secured by this Security Instrument. <br />If the Funds held by Lender exceed the amounts permitted to be held by Applicable Law, Lender shall account to <br />Borrower for the excess Funds in accordance with the requirements of Applicable Law. If the amount of the Funds <br />held by Lender at any time is not sufficient to pay the Escrow Items when due, Lender may so notify Borrower in <br />writing, and, in such case Borrower shall pay to Lender the amount necessary to make up the deficiency. Borrower <br />shall make up the deficiency in no more than twelve monthly payrnents, at Lender's sole discretion. <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 the section titled Acceleration; Remedies, Lender shall acquire or sell the <br />Property, Lender, prior to the acquisition or sale of the Property, shall apply any Funds held by Lender at the time <br />of acquisition or sale as a credit against the sums secured by the Security Instrument. <br />Application of Payments. Unless Applicable Law provides otherwise, all payments received by Lender shall be <br />applied: first, to any prepayrnent charges due under the Note; second, to amounts payable under the section titled <br />Funds for Taxes and Insurance; third, to interest due; fourth, to principal due; and last, to any late charges due <br />under the Note. <br />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 section titled Funds for Taxes and Insurance, or <br />if not paid in that manner, Borrower shall pay them on time directly to the person owed payment. At the request of <br />Lender, 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) <br />agrees in writing to the payment of the obligation secured by the lien in a manner acceptable to Lender; (b) <br />contests in good faith the lien by, or defends against enforcement of the lien in, legal proceedings which in the <br />Lender's opinion operate to prevent the enforcement of the lien; or (c) secures &om the holder of the lien an <br />agreement satisfactory to Lender subordinating the lien to this Security Instrurnent. If Lender determines that any <br />part of the Property is subject to a lien which may attain priority over this Security Instrument, Lender may give <br />Borrower a notice identifying the lien. Borrower shall satisfy the lien or take one or more of the actions set forth <br />above within 10 days of the giving of notice. <br />Hazard or Property Insurance. Borrower shall keep the improvements now existing or hereafter erected on the <br />Property insured against loss by fire, hazards included within the term "extended coverage" and any other hazards, <br />including floods or flooding, for which Lender requires insurance. This insurance shall be maintained in the <br />amounts and for the periods that Lender requires. The insurance carrier providing the insurance shall be chosen by <br />Borrower subject to Lender's approval which shall not be unreasonably withheld. If Borrower fails to maintain <br />coverage described above, Lender may, at Lender's option, obtain coverage to protect Lender's rights in the <br />Properly in accordance with section titled Proteetion of Lender's Rights in the Property. <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 <br />Lender all receipts of paid premiums and renewal notices. In the event of 1oss, Borrower shall give prompt notice <br />to the insurance carrier and Lender. Lender may make proof of loss if not made promptly by Borrower. <br />Unless Lender and Bonower otherwise agree in writing, insurance proceeds shall be applied to restoration or <br />repair of the Property damaged, if the restoration or repair is economically feasible and Lender's security is not <br />lessened. If the restoration or repair is not economically feasible or Lender's security would be lessened, the <br />insurance proceeds shall be applied to the sums secured by this Security Instrument, whether or not then due, with <br />any excess paid to Borrower. If Borrower abandons the Property, or does not answer within the number of days <br />prescribed by Applicable Law as set forth in a notice from Lender to Borrower 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 <br />restore the Property or to pay sums secured by this Security Instrument, whether or not then due. The period of <br />time for Borrower to answer as set forth in the notice 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 <br />or postpone the due date of the payments referred to in the sections titled Payment of Principal and Interest; <br />Late Charges and Funds for Taxes and Insurance or change the amount of the payments. If under the section <br />titled Acceleration; Remedies, the Property is acquired by Lender, Borrower's right to any insurance policies and <br />proceeds resulting from damage to the Property prior to the acquisition shall pass to Lender to the extent of the <br />sums secured by this Security Instrument immediately prior to the acquisition. <br />8 2004-2010 Compliaoa Systems, Inc. EEOB-6CD1 - 2010.03378 <br />Consumer Real Estace - Security Instrument DL2036 Page 2 of 6 www.compliancesystems.com <br />