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Borrowers escrow account under the federal qeal Estate Settlement Procedures Act of 1974 as amended from time to time, 12 U.S.C.
<br /> 2601 et seq. ("RESPA"), unless another Iaw 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 cuRent data
<br /> and reasonable estimates of expenditures of future Escrow Items or otherwise in accordance wkh applicable taw.
<br /> The Funds shall be held in an institution whose deposits are insured by a federal agency, instrumentality, or entity (including
<br /> Lender, if Lender is such an institution) or in any Federal Home Loan Bank. Lender shall appiy the Funds to pay the Escrow Items.
<br /> Lender may not charge Borrower for holding and applying the Funds, annually analyzing the escrow account, or verifying the Escrow
<br /> Items, unless Lender pays Borrower interest on the Funds and applicable 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 tax reporting service used by Lender in connection with
<br /> this loan, unless appl'�cable law provides otherwise. Unless an agreement is made or appl(cable law requires interest to be paid, Lender
<br /> shall not be required to pay BoROwer any interest or eamings on the Funds. Borrowe� and Lender may agree in writing, however, that' '�
<br /> interest shall be paid on the Funds. Lender shall give to BoROwer, wRhout charge, an annusl accounting of the Funds, showing �
<br /> credits and debits to the Funds and the purpose for wh�h each debk to the Funds was made. The Funds are pledged as additlonal �
<br /> securky 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 wfth the requirements of applicabie law. If the amount of the Funds held by Lender at any time is not �
<br /> suHicient to pay the Escrow Items when due, Lender may so notify BoROwer in writing, and, in such case BoROwer shatl pay to Lender Q
<br /> the amount necessary to make up the def�iency. Borrower shall make up the deficiency In no more than twelve monthl at
<br /> y payments,
<br /> Lender's soie discretion.
<br /> Upon payment in full of all sums secured by this Security Instrument, Lender shall promptly refund to Borrower any Funds heid by �
<br /> Lender. If, under paragraph 21, Lender shall acquire or sell the Property, Lender, prior to the acquisition or sale of the Property, shall �
<br /> appiy any Funds held by Lender at the time of acquisition or sale as a credit against the sums secured by this Security Instrument.
<br /> 3. Application of Payments. Unless applicable law provides othervvise, all payments received by Lender under paragraphs
<br /> 1 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 last, to any Iate charges due under the Note.
<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, N any. Borrower shali pay these
<br /> obigations in the manner provided in paragraph 2, or 'rf not paid in that manner, Borrower shall 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 shali promptly fumish to Lender receipts evidencing the payments.
<br /> Borrower shall promptly discharge any lien which has prlority over this Security �nstrument unless Borrower: (a) agrees in writing 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 defends
<br /> against enforcement of the lien in, legal proceedings which in the Lender's opinion operate to prevent the enforcement of the lien; or (c)
<br /> secures from the holder of the lien an agreement satisfactory to Lender subordinatlng the lien to th(s Security Instrument. If Lender
<br /> determines that any part of the Property is subject to a lien which may attain priorRy over this Security Instrument, Lender may give
<br /> Borrower a notice identifying the lien. Borrower shali satisy 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, (ncluding floods or
<br /> flooding, for which Lender requires insurance. This insurance shall be maintained in the amounts and for the per(ods that Lender
<br /> requires. The insurance carrier providing the insurance shall be chosen by Borrower subject to Lender's approval which shali not be
<br /> unreasonably withheld. If Borrower fails to maintain coverage described above, Lender may, at Lenders 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 right to hold the policies and renewals. If Lender requires, Borrower 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 canier and Lender. Lender may make
<br /> proof of loss H not made promptly by Borrower.
<br /> Unless Lender and Borrower otherwise agree in writing, fnsurance proceeds shall be applied to restoration or repair of the Property
<br /> damaged, it the restoration or repair is economically feasible and Lender's securfty 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 appl'�ed 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. �ender 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 w(II 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 the
<br /> due date of the monthly payments referred to in paragraphs 1 and 2 or change the amount of the payments. If under paragraph 21
<br /> the Property is acquired by Lender, Borrower's right to any insurance polic°fes and proceeds resufting trom 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, Mafntenance and Protection of the Property; Borrower's Loan
<br /> Application; Leaseholds. Borrower shall occupy, establish, and use the Property as Borrower's principal residence wkhin saty
<br /> days after the execution of this Security Instrument and shall continue to occupy the Property as Borrower's principal 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 Borrowers 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 defauR 'rf any forteiture action or
<br /> proceeding, whether civil or criminal, is begun that in Lender's good faith judgment could resuR in forfekure of the Property or othen�vise
<br /> materially impair the lien created by this Security Instrument or Lender's security interest. BoROwer 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 forfeiture of the Borrower's interest in the Property or other mater�al impairment of the lien created by this
<br /> Security Instrument or Lenders security interest. Bonower shali also be in default if Bonower, during the loan application process,
<br /> gave materially 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, including, but not limited to, representations conceming Borrowers occupancy of the
<br /> Property as a principal residence. It this Security Instrument is on a leasehold, Borrower shall comply with all the provisions of the
<br /> lease. If Borrower acquires fee title to the Property, the leasehold and the fee tkle shall not merge unless the Lender agrees to the
<br /> merger in writing.
<br /> Form 3028 B/90
<br /> F/029.LM� (10/97) Page 2 of 5
<br /> 703
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