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Exhibit 99.3

First Alliance Mortgage Company  
                                  Series 1997-3
                             1997 - Annual Statement
                              DISTRIBUTION DOLLARS
                                                                 ENDING
PERIOD     CLASS      CUST     INTEREST        PRINCIPAL         BALANCE
 199710     A-1              $202,270.83      $497,040.24     $34,502,959.76
 199711     A-1              $199,398.35      $399,429.85     $34,103,529.91
 199712     A-1              $197,089.98      $709,943.24     $33,393,586.67
Total by Class               $598,759.16    $1,606,413.33
                                                                 ENDING
PERIOD     CLASS      CUST     INTEREST        PRINCIPAL         BALANCE
 199710     A-2              $195,541.67      $531,932.96     $49,468,067.04
 199711     A-2              $248,556.43      $857,082.64     $48,610,984.40
 199712     A-2              $254,829.58      $984,971.94     $47,626,012.46
Total by Class               $698,927.68    $2,373,987.54

Total Class R:                     $0.00

Factor Information Per $1,000
             PRINCIPAL       INTEREST     ENDING NOTE    INIT NOTE  CURR NOTE
  CLASS     DISTRIBUTION   DISTRIBUTION     BALANCE           RATE       RATE

   A-1       45.89752371   17.10740457    954.10247629     6.93500%   6.93500%

   A-2       47.47975080   13.97855360    952.52024920     5.86625%   5.89750%

                                                          Per $1,000
NOTE DISTRIBUTION:                         $5,278,087.71     62.10

SCHEDULED PRINCIPAL:                         $164,487.73
PREPAYMENTS:                               $3,257,771.97
SUBORDINATION INCREASE:                      $558,141.17
                                           -------------

TOTAL PRINCIPAL DISTRIBUTION:              $3,980,400.87     46.83

TOTAL INTEREST DISTRIBUTION:               $1,297,686.84

INSURED PAYMENT
   CLASS A-1:                                       0.00
   CLASS A-2:                                       0.00


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CODE INFORMATION:                                 NONE

LOAN PURCHASE PRICES
  GROUP I:                                        0.00
  GROUP II:                                       0.00

SUBSTITUTION AMOUNTS
  GROUP I:                                        0.00
  GROUP II:                                       0.00
SUBORDINATION REDUCTION AMOUNT
  GROUP I:                                        0.00
  GROUP II:                                       0.00

CURRENT REALIZED LOSSES
  GROUP I:                                        0.00
  GROUP II:                                       0.00

CUMULATIVE REALIZED LOSSES
  GROUP I:                                        0.00
  GROUP II:                                       0.00

LOAN BOUGHT PURSUANT TO
SECTION 3.4, 3.6 AND 8.10
  GROUP I:                                        0.00
  GROUP II:                                       0.00

AVAILABLE FUNDS CAP CARRY-FORWARD AMOUNT
  GROUP I:                                        0.00
  GROUP II:                                       0.00

POOL FACTOR
  CLASS A-1:                                0.95410248
  CLASS A-2:                                0.95252025

DELINQUENT MORTGAGE LOANS(includes loans in foreclosure and bankruptcy):

         GROUP I:
                                  AGGREGATE
            CATEGORY    NUMBER   LOAN BALANCE   PERCENTAGE
           30-59 DAYS      8      $726,983.61      2.16%
           60-89 DAYS      3      $221,144.02      0.66%
            90+ DAYS       5      $249,299.94      0.74%

         GROUP II:
                                  AGGREGATE
            CATEGORY     NUMBER  LOAN BALANCE   PERCENTAGE
            30-59 DAYS    10      $553,201.35      1.15%
            60-89 DAYS     1       $63,780.17      0.13%
             90+ DAYS      7      $465,366.40      0.97%


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LOANS IN FORECLOSURE(included in delinquencies above)

      GROUP I:                    AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                            8     $602,669.07      1.79%

      GROUP II:                   AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                           14     $871,135.37      1.82%

LOANS IN BANKRUPTCY(included in delinquencies above)
      GROUP I:                    AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                            0           $0.00      0.00 %

      GROUP II:                   AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                            0           $0.00      0.00%

REO PROPERTIES(included in delinquencies above)

      GROUP I:                    AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                            0           $0.00      0.00%

      GROUP II:                   AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                            0           $0.00      0.00%

ENDING AGGREGATE LOAN BALANCE
  GROUP I:                              $33,594,777.80
  GROUP II:                             $47,984,617.08

ENDING INITIAL MORTGAGE LOANS
  GROUP I:                                   N/A
  GROUP II:                                  N/A

ENDING SUBSEQUENT MORTGAGE LOANS
  GROUP I:                                   N/A
  GROUP II:                                  N/A

BOOK VALUE OF REO PROPERTY:
  GROUP I:                                        0.00
  GROUP II:                                       0.00

SERVICING FEE
  GROUP I:                                  $43,256.24
  GROUP II:                                 $61,880.23