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                                                                  EXHIBIT 10.197

                  FOURTH AMENDMENT TO FORBEARANCE AGREEMENT AND
               AMENDMENT NO. 9 TO SECOND AMENDED AND RESTATED AND
                    CONSOLIDATED LOAN AND SECURITY AGREEMENT

                  This Fourth Amendment to Forbearance Agreement and Amendment
No. 9 to Second Amended and Restated and Consolidated Loan and Security
Agreement ("Amendment") is made and entered into this 17th day of December, 1999
(the "Effective Date"), by and among FINOVA CAPITAL CORPORATION, a Delaware
corporation ("FINOVA" or "Lender"), PREFERRED EQUITIES CORPORATION, a Nevada
corporation ("Borrower") and MEGO FINANCIAL CORP., a New York corporation
("Guarantor") and has reference to the following facts:

                  A. Lender and Borrower entered into a Second Amended and
Restated and Consolidated Loan and Security Agreement dated as of May 15, 1997
(the "Original Loan Agreement") that evidences a loan from Lender to Borrower.
The Original Loan Agreement was amended by the Hartsel Springs Side Letter dated
February 18, 1998 (the "First Amendment"); by the Letter Agreement [Biloxi
Property] dated March 20, 1998 (the "Second Amendment"); by the Letter Agreement
[Headquarters Readvance] dated September 29, 1998 (the "Third Amendment"), by
the Amendment No. 4 to Second Amended and Restated and Consolidated Loan and
Security Agreement dated November 6, 1998 (the "Fourth Amendment"); by that
certain Forbearance Agreement and Amendment No. 5 to Second Amended and Restated
and Consolidated Loan and Security Agreement dated December 23, 1998, as the
same was amended by a Letter Agreement dated February 8, 1999 (the "Fifth
Amendment"); a First Amendment to Forbearance Agreement and Amendment No. 6 to
Second Amended and Restated and Consolidated Loan and Security Agreement dated
May 7, 1999 (the "Sixth Amendment"); a Second Amendment to Forebearance
Agreement and Amendment No. 7 to Second Amended and Restated and Consolidated
Loan and Security Agreement dated August 6, 1999 (the "Seventh Amendment"); a
September 7, 1999 letter agreement regarding the Additional Advance Note (the
"Additional Advance Letter"); a Third Amendment to Forebearance Agreement and
Amendment No. 8 to Loan and Security Agreement dated November 9, 1999 (the
"Eighth Amendment"); and, a side letter, dated December 3, 1999 between the
Borrower and Lender (the "Receivable Loan Lot Cap Letter"). The Original Loan
Agreement, First Amendment, Second Amendment, Third Amendment, Fourth Amendment,
Fifth Amendment, Sixth Amendment, Seventh Amendment, Additional Advance Letter,
Eighth Amendment and the Receivable Loan Lot Cap Letter are collectively called
the "Loan Agreement." Capitalized terms used in this Amendment which are defined
in the Loan Agreement shall have the same meaning and definition when used
herein.

                  B. Borrower has requested the Lender to make certain
modifications to the Loan Agreement and the Loan, which the Lender is willing to
do, upon and subject to the terms and conditions set forth in this Amendment.



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                  Now, therefore, in consideration of the foregoing and for the
good and valuable consideration provided herein, Lender, Borrower and Guarantor
agree as follows:

                  1. On the Effective Date, the provisions of Article 1 of the
Loan Agreement is amended to add the following definition:

                  "Ninth Amendment": shall mean and collectively refer to the
            Ninth Amendment to Forbearance Agreement and Amendment No. 9 to
            Second Amended and Restated and Consolidated Loan and Security
            Agreement made and entered into on December 17, 1999 among Borrower,
            Lender and Guarantor.

                  2. The provisions of Section 2.2 of the Loan Agreement
provides that the principal amount of any and all indebtedness of Borrower to
Lender, under the Receivable Loan, which is secured by Receivables Collateral
encumbering Lots shall not exceed $35,000,000.00. The Receivable Loan Lot Cap
Letter increased the $35,000,000.00 to $36,000,000.00. As of the Effective Date,
Section 2.2 of the Loan Agreement is amended so that the references to
"$36,000,000.00" shall now refer to "$40,000,000.00". The Borrower acknowledges
that the foregoing amendment to Section 2.2 in no way modifies or increases the
Maximum Loan Amount nor the maximum amount available under the Receivables Loan.

                  3. Under the First Amendment and the Eighth Amendment, the
Lender has advanced to Borrower funds from the Mortgage Loan Facility that are
evidenced by the Hartsel Springs Ranch Note and secured by the Hartsel Springs
Deed of Trust. The Loan Agreement contemplates as Lots are sold, upon the
payment to Lender of a Project Release Fee of $3,600 (the "Hartsel Release
Fee"), the Lender will apply the Hartsel Release Fee to the Hartsel Spring Ranch
Note and will release the Lot from the lien of the Hartsel Springs Deed of
Trust. As of the Effective Date, it is anticipated that the Hartsel Springs
Ranch Note will be fully repaid by the payment of the Hartsel Release Fee prior
to the date that the Borrower has fully Performed and paid all of its other
Obligations. To provide the Lender with additional security for the payment and
Performance of the Obligations, the Borrower hereby agrees that notwithstanding
the payment in full of all principal and interest due to the Lender under the
Hartsel Springs Ranch Note, the Lender will retain its lien on all unsold Lots
at the Hartsel Springs Ranch that are owned by the Borrower, including the
Additional Lots (the Lots encumbered by the Hartsel Spring Deed of Trust at or
contemporaneously with the final payment of all sums due under the Hartsel
Spring Note are called the "Remaining Lots") until such time as the Borrower has
fully Performed and paid all of its Obligations under the Additional Advance
Note. As a Remaining Lot is sold, the Lender agrees to release the lot from the
lien of the Hartsel Spring Deed of Trust upon the payment of the Hartsel Release
Fee. Provided there is no Event of



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Default or Incipient Default, the payments received pursuant to the previous
sentence will be applied to the Lender first against fees, costs and expenses
due to Lender; then against the unpaid principal balance of the Additional
Advance Note and all accrued interest thereon. However, upon the occurrence of
an Event of Default or Incipient Default, the Hartsel Release Fee shall be
applied against the Obligations in such order, as the Lender shall deem
appropriate. The Borrower agrees to execute and deliver to the Lender such
document, as the Lender may deem appropriate to evidence the agreement of the
Borrower under this subparagraph.

                  4. The obligations of the Lender under this Amendment are
conditioned upon the satisfaction of the following conditions:

                           (a) This Amendment has been fully signed by the
         Borrower and Guarantor.

                           (b) Lender has received, on or before December 17,
         1999, the following, all in a form and content acceptable to Lender:

                                    (i) Current updates of the legal opinions
                  received by Lender in connection with the Loan Agreement; and

                                    (ii) An amendment to the Hartsel Springs
                  Deed of Trust addressing the matters described in Paragraph 3
                  of this Amendment executed by the Borrower (the "New Hartsel
                  Amendment").

                           (c) The Borrower, at its sole cost and expense,
         delivering to the Lender and endorsement to the Lender's existing title
         policy for the Hartsel Springs Deed of Trust which (i) adds to the deed
         of trust insured thereby the New Hartsel Amendment, and (ii) "dates
         down" or endorses the date of the policy to the date of the recordation
         of the New Hartsel Amendment.

                           (d) The Borrower executing and delivering to the
         Lender such additional documents or instruments as required and
         approved by the Lender so as to fully perfect the liens and security
         interest of Lender granted under the Loan Agreement

                           (e) Borrower shall have reimbursed Lender for all of
         Lender's out-of-pocket costs and expenses including, without
         limitation, attorney's, engineers' and other consultants' fees and
         costs, incurred in connection with the documentation and closing of
         this Amendment.

                  5. Borrower and Guarantor each represents and warrants that:

                           (a) All financial information and other documents it
         has provided to Lender in connection with this Amendment are true,
         complete and correct as of the date provided and the date hereof;


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                           (b) There exists no Event of Default or Incipient
         Default, after giving effect to the then applicable provisions of this
         Amendment and other than the Existing Events of Default;

                           (c) After giving effect to this Amendment, there has
         been no material adverse change in any real property or in the business
         or financial condition of Borrower and Guarantor since the date of the
         last financial statements submitted to Lender; and

                           (d) After giving effect to this Amendment, all
         representations and warranties by Borrower and Guarantor remain true,
         complete, and correct, in all material respects as of the date hereof.

                  6. Guarantor acknowledges and agrees that (i) the Guarantee
shall remain in full force and effect, (ii) the obligations of the Guarantor
under the Guarantee are joint and several with those of each other Obligor (as
that term is defined in the Guarantee), (iii) Guarantor's liability under the
Guarantee shall continue undiminished by and shall include the obligations of
the Borrower under this Amendment and any other documents and instruments
executed by Borrower in connection with this Amendment and each of the other
Documents, as amended through the date hereof and (iv) all terms, conditions and
provisions set forth in this Amendment and any other documents and instruments
executed by Borrower in connection with this Amendment and each of the other
Documents, as amended through the date hereof, are hereby ratified, approved and
confirmed.

                  7. Borrower and Guarantor acknowledge and agree that they have
no defenses, counterclaims, setoffs, recoupments or other adverse claims or
causes of action in tort, contract or of any other kind existing against Lender
or with respect to the Documents, including without limitation, claims regarding
the amount, validity, perfection, priority and enforceability of the Documents.

                  8. The Documents shall be deemed amended by the provisions of
this Amendment, as and when applicable and any conflict or inconsistency between
this Amendment and the Documents shall be resolved in favor of this Amendment.
Except as so amended, all other consistent terms and conditions of the Documents
will remain in full force and effect, and are hereby ratified and affirmed
(including, but not limiting the generality of the foregoing, Section 14 of the
Fifth Amendment is hereby specifically ratified and affirmed and all references
therein to the term "Amendment" shall be deemed to refer to the Ninth
Amendment).

                  9. Except as may be expressly provided herein, Borrower's and
Guarantor's respective obligations under the Documents shall remain in full
force and effect and shall not be waived, modified, superseded or otherwise
affected by this Amendment. This Amendment is not a novation, nor is it be
construed as a release, waiver, extension of forbearance or modification of any
of the terms, conditions, representations, warranties,

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covenants, rights or remedies set forth in any of the Documents, except as
expressly stated herein.

                  10. This Amendment in no way acts as a waiver of any default
of Borrower or as a release or relinquishment of any of the liens, security
interests, rights or remedies securing payment and Performance of the Borrower's
Obligations or the enforcement thereof. Such liens, security interests, rights
and remedies are hereby ratified, confirmed, preserved, renewed and extended by
Borrower in all respects. Further, Lender's execution of this Amendment shall
not constitute a waiver (either express or implied) of the requirement that any
further forbearance under or modification of the Loan Agreement or any other
Document shall require the express written approval of Lender. No such approval
(either express or implied) has been given as of the date hereof.

                  11. Borrower and Guarantor acknowledge that Lender has
performed, and is not in default of, its obligations under the Documents; that
there are no offsets, defenses or counterclaims in tort, contract or otherwise,
with respect to any of Borrower's or Guarantor's or other party's obligations
under the Documents; and that Lender has not directed Borrower to pay or not pay
any of Borrower's payables.

                  12. Borrower and Guarantor will execute and deliver such
further instruments and do such things as in the judgment of Lender are
necessary or desirable to effect the intent of this Amendment and to secure to
Lender the benefits of all rights and remedies conferred upon Lender by the
terms of this Amendment and any other documents executed in connection herewith.

                  13. If any provision of this Amendment is held to be
unenforceable under present or future laws effective while this Amendment is in
effect (all of which invalidating laws are waived to the fullest extent
possible), the enforceability of the remaining provisions of this Amendment
shall not be affected thereby. In lieu of each such unenforceable provision,
there shall be added automatically as part of this Amendment a provision that is
legal, valid and enforceable and is similar in terms to such unenforceable
provisions as may be possible.

                  14. Any further discussions by and among Borrower, Guarantor
and Lender, if any, and all such discussions in the past, together with any
other actions or inactions taken by and among Borrower, Guarantor and Lender,
shall not cause a modification of the Documents, establish a custom or waive
(unless Lender made such express waiver in writing), limit or condition the
rights and remedies of Lender under the Documents, all of which rights and
remedies are expressly reserved. All of the provisions of the Documents,
including, without limitation, the time of the essence provision, are hereby
reiterated and if ever waived are hereby reinstated (unless Lender made such
express waiver in writing), except as expressly provided herein. Notwithstanding
anything to the contrary contained herein or in any other instrument executed by
the parties and notwithstanding any other action or conduct undertaken by the
parties on or before the date hereof, the

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agreements, covenants and provisions contained herein shall constitute the only
evidence of Lender's agreement to forbear or to modify the Loan Agreement.
Accordingly, no express or implied consent to any further forbearances or
modifications shall be inferred or implied by Lender's execution of this
Amendment. The Loan Agreement and this Amendment, together with the other Loan
Documents, constitute the entire agreement and understanding among the parties
relating to the subject matter hereof, and supersedes all prior proposals,
negotiations, agreements and understandings relating to such subject matter. In
entering into this Ninth Amendment, Borrower acknowledges that it is relying on
no statement, representation, warranty, covenant or agreement of any kind made
by the Lender or any employee or agent of the Lender, except for the agreements
of Lender set forth herein.

                  15. This Amendment shall not be binding upon Lender until
accepted by Borrower and Guarantor as provided for below. This Amendment may be
executed in counterpart, and any number of which have been executed by all
parties shall be deemed to constitute one original. Lender, its attorneys and
agents may also integrate into a single Amendment signature pages from separate
counterpart Amendments. The telecopied signature of a person shall be deemed an
original signature, may be relied upon by others and shall be binding upon the
signer for all purposes provided however that Borrower, Guarantor or any person
otherwise consenting hereto by telecopied signature shall confirm its telecopied
signature by signing and returning to Lender a copy of this Amendment with an
original signature.

                  16. Borrower's and Guarantor's representatives are experienced
and knowledgeable business people and have been represented by independent legal
counsel who are experienced in all matters relevant to this Amendment,
including, but not limited to, bankruptcy and insolvency law. The parties hereto
have accepted and agreed to this Amendment after being fully aware and advised
of the effect and significance of all of its terms, conditions, and provisions.

                  17. Unless otherwise specifically stipulated elsewhere in the
Documents, if a matter is left in the Documents or this Amendment to the
decision, right, requirement, request, determination, judgment, opinion,
approval, consent, waiver, satisfaction, acceptance, agreement, option or
discretion of Lender, its employees, Lender's counsel or any agent for or
contractor of Lender, such action shall be deemed to be exercisable by Lender or
such other person in its sole and absolute discretion and according to standards
established in its sole and absolute discretion. Without limiting the generality
of the foregoing, "option" and "discretion" shall be implied by use of the words
"if" or "may."

                  18. The Recitals in this Amendment are incorporated into the
body hereof as fully set forth herein.

                  19. THIS AMENDMENT HAS BEEN EXECUTED AND DELIVERED AND SHALL
BE PERFORMED IN THE STATE OF ARIZONA. THE PROVISIONS OF THIS AMENDMENT AND ALL
RIGHTS AND OBLIGATIONS OF THE PARTIES


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HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF ARIZONA AND TO THE EXTENT THEY PREEMPT SUCH LAWS, THE LAWS
OF THE UNITED STATES. EACH OF BORROWER, GUARANTOR AND LENDER: (A) HEREBY
IRREVOCABLY SUBMITS ITSELF TO THE PROCESS, JURISDICTION AND VENUE OF THE COURTS
OF THE STATE OF ARIZONA, MARICOPA COUNTY, AND TO THE PROCESS, JURISDICTION, AND
VENUE OF THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA, FOR THE
PURPOSES OF SUIT, ACTION OR OTHER PROCEEDINGS ARISING OUT OF OR RELATING TO ANY
DOCUMENT OR THE SUBJECT MATTER THEREOF, OR, IF LENDER SHALL INITIATE SUCH
ACTION, IN THE COURT IN WHICH SUCH ACTION IS INITIATED PROVIDED THAT SUCH COURT
HAS JURISDICTION, AND THE CHOICE OF SUCH VENUE SHALL IN ALL INSTANCES BE AT
LENDER'S ELECTION; AND (B) WITHOUT LIMITING THE GENERALITY OF THE FOREGOING,
HEREBY WAIVES AND AGREES NOT TO ASSERT BY WAY OF MOTION, DEFENSE OR OTHERWISE IN
ANY SUCH SUIT, ACTION OR PROCEEDING ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT
TO THE JURISDICTION OF THE ABOVE-NAMED COURTS, THAT SUCH SUIT, ACTION OR
PROCEEDING IS BROUGHT IN ANY INCONVENIENT FORUM OR THAT THE VENUE OF SUCH SUIT,
ACTION OR PROCEEDING IS IMPROPER. EACH OF BORROWER, GUARANTOR AND LENDER HEREBY
WAIVE THE RIGHT TO COLLATERALLY ATTACK ANY JUDGMENT OR ACTION IN ANY OTHER
FORUM.

                            [SIGNATURE PAGE FOLLOWS]


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LENDER:

FINOVA CAPITAL CORPORATION,
a Delaware corporation

By:
   ---------------------------------------------
     Its:
         ---------------------------------------


BORROWER:

PREFERRED EQUITIES CORPORATION,
a Nevada corporation

By:   /s/ Jon A Joseph
     -------------------------------------------

     Its: Vice President
          --------------------------------------


Signed in the presence of:

------------------------------------------------


GUARANTOR:

MEGO FINANCIAL CORP.,
a New York corporation

By: /s/ Jon  A. Joseph
   ---------------------------------------------
     Its: Vice President
          --------------------------------------

Signed in the presence of:


---------------------------------------------

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STATE OF NEVADA                     )
                                    ) ss.
County of                           )

                  The foregoing instrument was acknowledged before me this 17th
day of December 1999 by Jon Joseph as Vice President of PREFERRED EQUITIES
CORPORATION, a Nevada corporation, on behalf of the corporation.

                                      -----------------------------------------
                                                 Notary Public

My Commission Expires:

-------------------------

STATE OF NEVADA                     )
                                    ) ss.
County of                           )

                  The foregoing instrument was acknowledged before me this ____
day of December 1999, by ______________ as _______________ of MEGO FINANCIAL
CORP., a New York corporation, on behalf of the corporation.

                                      -----------------------------------------
                                                 Notary Public

My Commission Expires:

-------------------------

STATE OF ARIZONA               )
                               ) ss.
County of Maricopa             )

                  This instrument was acknowledged before me on December __,
1999, by ______________________, as _______________ of FINOVA CAPITAL
CORPORATION, a Delaware corporation.

                                      -----------------------------------------
                                      Notary

                                      My Commission Expires:


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