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Borrower's escrow account under the (ederal Real Estate Settlement Procedures Act of 1974 as amended from time to time, 12 U.S.C.
<br /> 2601 at seq. ("FiESPA"), unless another law that applies to the Funds sets a lesser amount. If so, Lender may, at any time, collect and
<br /> hold Funds in an amount not to exceed the lesser amount. Lender may estimate the amount of funds due on the basis of current da� __._
<br /> and reasonable estimates of expenditures of future Escrow Items or otherwise in eccordance with applicable Iaw.
<br /> The Funds shall be held in an institution whose deposits are insured by a federal agency, instrumentality, or entity (including �
<br /> Lender, ff Lender is such an institution) or in any Federal Home Loan Bank. Lender shall apply the Funds to pay the Escrow items.�
<br /> Lender may not charge Borrower for hoiding and applying the Funds, annually analyzing the escrow accou�t, or verifying the Escrow �
<br /> Items; unless Lender pays Bonawer interest on the Funds and appiicable law permits Lender to make such a charge. However, Lender �
<br /> may require Borrower to pay a one-time charge for an independent real estate tex reporting service used by Lender fn connection with
<br /> this loan, unless applicable law provides otherwise. Unless an agreement is made or applicabie law requires interest to be paid, Lender
<br /> shall not be required to pay Borrower any interest or eamings on the Funds. Borrower and Lender may agree in writing, however, that
<br /> interest shall be paid on the Funds. Lender shall give to BoROwer, wkhout charge, an annual accountfng of the Funds, showing
<br /> credits and debits to the Funds and the purpose for which each debit to the Funds was made. The Funds are pledged as additional W
<br /> security for all sums 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 Borrower for the
<br /> excess Funds in accordance with the requirements of applicable law. If the amount of the Funds held by Lender at any time is not
<br /> sufficient to pay the Escrow Items when due, Lender may so notify Borrower in wrking, and, in such case Borrower shall pay to Lender
<br /> the amount necessary to make up the def�iency. Borrower shall make up the dei�lency in no more than tweNe monthly payments, at
<br /> Lenders sole discretion.
<br /> Upon payment in full of all sums secured by this Securky Instrument, Lender shali prompty refund to Borrower any Funds held by
<br /> Lender. If, under paragraph 21, Lender shall acquire or sell the Property, Lender, prior to the acquisftion or sale of the Property, shall
<br /> apply any Funds held by Lender at the time of acquisition or sale as a credit against the sums secured by this Securky Instnrment.
<br /> 3. Application of Payments. Uniess appiicable law provides othervvise, all payments recelved by Lender under paragraphs
<br /> t and 2 shall be applied: first, to any prepayment charges due under the Note; second, to amounts payable under paragraph 2; third
<br /> to interest due; fourth, to principal due; and Iast, to any late charges due under the Note.
<br /> 4. Chel'g@S; Liens. Borrower shall pay all taxes, assessments, charges, fines and impositions attributable to the Property
<br /> which may attain prior$y over this Security Instrument, and leasehold payments or ground rents, ff any. Borrower shall pay these
<br /> obligations in the manner provided in paragraph 2, or ff not paid in that manner, Borrower shali pay them on time directly to the person
<br /> owed payment. Borrower shall promptly fumish to Lender all not�Ces of amounts to be paid under this paragraph. If Borrower makes
<br /> these payments directly, Borrower shall promptly furnish to Lender receipts evidencing the payments.
<br /> Bonower shall promptly discharge any lien which has priority over this Security Instrument unless Borrower: (a) agrees in wrking to
<br /> the payment of the obligation secured by the lien in a manner acceptable to Lender; (b) contests in good fakh the lien by, or detends
<br /> against enforcement of the lien in, legal proceedings which in the Lender's opinion operate to prevent the enforceme�t of the lien; or (c)
<br /> secures from the holder of the lien an agreement satisfactory to Lender subordinating the lien to this Securfty Instrument. If Lender
<br /> determines that any 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 above within 10 days
<br /> of the giving of notice.
<br /> 5. 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, including floods or
<br /> flooding, for which Lender requires insurance. This insurance shall be maintained in the amounts and for the periods that Lender
<br /> requires. The insurance carrier providing the insurance shall be chosen by Borrower subject to Lender's approval which shall not be
<br /> unreasonably withheld. If Borrower fails to maintain coverage described above, Lender may, at Lender's option, obtain coverage to
<br /> protect Lender's rights in the Property in accordance with paragraph 7.
<br /> All insurance policies and renewals shall be acceptable to Lender and shall include a standard mortgage clause. Lender shall have
<br /> the rght to hoid the policies and renewals. If Lender requires, Bonower shall promptly give to Lender all receipts of paid premiums
<br /> and renewal notices. In the event of loss, Borrower shall give prompt notice to the insurance carrier and Lender. Lender may make
<br /> prooi of loss if not made promptly by Borrower.
<br /> Unless Lender and Bonower otherwise agree in writing, insurance proceeds shall be applied to �estoration or repair of the Property
<br /> damaged, if the restoration or repair is economically feasible and Lender's security is not lessened. If the restoration or repair is not
<br /> economically feasible or Lender's security would be lessened, the insurance proceeds shall be applied to the sums secured by this
<br /> Security Instrument, whether or not then due, with any excess paid to Borrower. If Borrower abandons the Property, or does not
<br /> answer within 30 days a notice from Lender that the insurance carrier has offered to settle a claim, then Lender may collect the
<br /> insurance proceeds. Lender may use the proceeds to repair or restore the Property or to pay sums secured by this Security
<br /> Instrument, whether or not then due. The 30-day period will begin when the notice is given.
<br /> Uniess Lender and Borrower otherwise agree in writing, any application of proceeds to principal shall not extend or postpone the
<br /> due date of the monthly payments referred to in paragraphs 1 and 2 or change the amount ot the payments. If under paragraph 21
<br /> the Property is acquired by Lender, Borrower's right to any insurance policies and proceeds resuking from damage to the Property prior
<br /> to the acquisition shall pass to Lender to the extent of the sums secured by this Security Instrument immediately prior to the
<br /> acquisition.
<br /> 6. Occupancy, Preservation, Maintenance and Protection of the Property; Borrower's Loan
<br /> Appiication; Leaseholds. Bonower shall occupy, establish, and use the Property as Borrower's principa� residence wkhin sbcty
<br /> days after the execution of this Security Instrument and shall continue to occupy the Property as Borrower's prinCipai residence for at
<br /> least one year after the date of occupancy, unless Lender otherwise agrees in writing, which consent shall not be unreasonably
<br /> withheld, or unless extenuating circumstances exist which are beyond Borrower's control. Borrower shall not destroy, damage or impair
<br /> the Property, allow the Property to deteriorate, or commit waste on the Property. Borrower shall be in defauft ff any forfeiture action or
<br /> proceeding, whether civil or criminal, is begun that in Lender's good faith judgment could resuft in forfeiture of the Property or otherwise
<br /> materially impair the lien created by this Security Instrument or Lender's security fnterest. Borrower may cure such a defauR and
<br /> reinstate, as provided in paragraph 18, by causing the action or proceeding to be dismissed with a ruling that, in Lender's good faith
<br /> determination, precludes fodeiture of the Borrower's interest in the Property or other material impairment of the lien created by this
<br /> Security Instrument or Lender's security interest. Borrower shall also be in defauR if Borrower, during the loan application process,
<br /> gave materia�ly false or inaccurate information or statements to Lender (or failed to provide Lender with any material information) in
<br /> connection with the loan evidenced by the Note, inciuding, but not I'rnked to, representations concemhg Borrower's occupancy of the
<br /> Property as a pr�cipal residence. If this Security Instrument is on a leasehold, Borrower shall comply with all the provisions of the
<br /> lease. if BoROwer acquKes (ae title to the Property, the leasehold and the fee title shall not merge unless the Lender agrees to the
<br /> merger in writing.
<br /> Form 3028 9/90
<br /> Ft029.LM0 (10/97) Page 2 of 5
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