Exhibit A
                                 PROMISSORY NOTE
                                 ---------------

$30,000,000.00                                                    April 11, 1997
                                                                Phoenix, Arizona

                  FOR  VALUE  RECEIVED,   CONTINENTAL  HOMES  HOLDING  CORP.,  a
Delaware corporation  ("Maker"),  hereby promises and agrees to pay to the order
of GUARANTY FEDERAL BANK, FSB ("Payee"), the principal sum of THIRTY MILLION AND
NO/100 DOLLARS ($30,000,000.00) in lawful money of the United States of America,
or, if less than such principal amount, the aggregate unpaid principal amount of
all  Advances  made to Maker  by the  Payee  pursuant  to the  Credit  Agreement
hereinafter  referenced.  Such payment shall be made on the Facility Termination
Date, as defined in the Credit Agreement.

                  Maker  shall pay  interest  from the date hereof on the unpaid
principal  amount of this Note from time to time  outstanding  during the period
from the date hereof until such  principal  amount is paid in full at the rates,
determined  in the  manner,  and on the dates or  occurrences  specified  in the
Credit Agreement (as hereinafter defined).

                  This  promissory  note is one of the Notes  referred to in the
Credit Agreement dated as of June 27, 1996, among Maker, Bank One, Arizona,  NA,
as Agent, and the Banks named therein, and that First Modification  Agreement of
even date herewith (as the same may be amended,  modified,  replaced, or renewed
from time to time,  the "Credit  Agreement")  and is entitled to the benefits of
the Credit Agreement and the Loan Documents. Capitalized terms used in this Note
without definition shall have the same meanings as are ascribed to such terms in
the Credit Agreement.

                  Both  principal  and interest are payable to the Agent for the
account of Payee  pursuant to the terms of the Credit  Agreement.  All  Advances
made by Payee pursuant to the Credit Agreement and all payments of the principal
amount of such  Advances,  shall be  endorsed  by the holder of this Note on the
schedule  attached hereto.  Failure to record such Advances or payment shall not
diminish  any rights of Payee or relieve  Maker of any  liability  hereunder  or
under the Credit Agreement.  This Note is subject to prepayment and its maturity
is subject to  acceleration,  in each case upon the terms provided in the Credit
Agreement.

                  This Note may not be modified or discharged  orally, by course
of dealing  or  otherwise,  but only by a writing  duly  executed  by the holder
hereof.
<PAGE>
                  In the event that any action, suit or proceeding is brought by
the holder hereof to collect this Note,  Maker agrees to pay and shall be liable
for  all  costs  and  expenses  of  collection,  including  without  limitation,
reasonable attorneys' fees and disbursements.

                  Maker and all sureties, guarantors and/or endorsers hereof (or
of any  obligation  hereunder) and  accommodation  parties hereon (all of which,
including  Maker,  are severally each  hereinafter  called a "Surety") each: (a)
agree  that the  liability  under this Note of all  parties  hereto is joint and
several;  (b)  severally  waive  any  homestead  or  exemption  laws and  rights
thereunder  affecting the full  collection of this Note; (c) severally waive any
and all  formalities in connection  with this Note to the maximum extent allowed
by law,  including  (but not  limited  to) demand,  diligence,  presentment  for
payment, protest and demand, and notice of extension,  dishonor, protest, demand
and  nonpayment of this Note; and (d) consent that holder may extend the time of
payment or otherwise modify the terms of payment of any part or the whole of the
debt  evidenced by this Note, at the request of any other person liable  hereon,
and such  consent  shall not alter nor  diminish  the  liability  of any  person
hereon.

                  In addition,  each Surety waives and agrees not to assert: (a)
any right to require the holder hereof to proceed  against any other Surety,  to
proceed against or exhaust any security for the Note, to pursue any other remedy
available to the holder hereof,  or to pursue any remedy in any particular order
or manner; (b) the benefit of any statute of limitations affecting its liability
hereunder or the enforcement  hereof; (c) the benefits of any legal or equitable
doctrine or principle of marshaling;  (d) notice of the  existence,  creation or
incurring of new or additional  indebtedness  of any Maker to the holder hereof;
(e) the benefits of any statutory  provision limiting the liability of a surety,
including without limitation the provisions of Sections 12-1641, et seq., of the
Arizona Revised Statutes; (f) any defense arising by reason of any disability or
other defense of Maker or by reason of the cessation  from any cause  whatsoever
(other than  payment in full) of the  liability of any Maker for payment of this
Note; and (g) the benefits of any statutory  provision limiting the right of the
holder hereof to recover a deficiency judgment,  or to otherwise proceed against
any person or entity  obligated for payment of this Note,  after any foreclosure
or trustee's sale of any security for this Note,  including  without  limitation
the benefits,  if any, to a Surety of Arizona Revised  Statutes  Section 33-814.
Until  payment in full of this Note and the holder  hereof has no  obligation to
make any further advances of the proceeds hereof, no Surety shall have any right
of subrogation  and each hereby waives any right to enforce any remedy which the
holder hereof now has, or may hereafter have, against Maker or any other
<PAGE>
Surety, and waives any benefit of, and any right to participate in, any security
now or hereafter held by the holder hereof.

                  Maker  agrees that to the extent any Surety  makes any payment
to the holder hereof in connection with the indebtedness evidenced by this Note,
and all or any part of such payment is subsequently invalidated,  declared to be
fraudulent or preferential, set aside or required to be repaid by Holder or paid
over to a trustee,  receiver or any other entity,  whether under any  bankruptcy
act or otherwise (any such payment is hereinafter referred to as a "Preferential
Payment"),  then the  indebtedness  of Maker  under this Note shall  continue or
shall be  reinstated,  as the case may be, and, to the extent of such payment or
repayment by the holder hereof, the indebtedness  evidenced by this Note or part
thereof intended to be satisfied by such  Preferential  Payment shall be revived
and continued in full force and effect as if said  Preferential  Payment had not
been made.

                  This Note has been  delivered in the City of Phoenix and State
of Arizona, and shall be enforced under and governed by the laws of the State of
Arizona  applicable to contracts made and to be performed  entirely  within said
state, without references to any choice or conflicts of law principles.


                                        CONTINENTAL   HOMES  HOLDING   CORP.,  a
                                        Delaware corporation



                                        By: /s/Donald R. Loback
                                           -------------------------------------
                                        Name:    Donald R. Loback
                                        Title:   Chief Executive Officer
<PAGE>
April 11, 1997
Bank One, Arizona, NA,
in its capacity as Agent
and in its individual capacity
Western Region Real Estate
241 North Central Avenue
Phoenix, Arizona 85004
Attention:  Rhonda R. Williams, Vice President

Norwest Bank Arizona, NA
3300 North Central Avenue, MS-9008
Phoenix, Arizona 85012-2501
Attention:  Vicki Slade, Vice President

The First National Bank of Boston
115 Perimeter Center Place, N.E., Suite. 1500
Atlanta, Georgia 30346
Attention:  Nick Whiting, Vice President

Guaranty Federal Bank, FSB

         Re: Unsecured Revolving Line of Credit in the amount of $140,000,000.00
("Loan") made by Bank One, Arizona, NA, a national banking association,  Norwest
Bank Arizona,  NA, The First National Bank of Boston, and Guaranty Federal Bank,
FSB (collectively,  the "Banks"), to Continental Homes Holding Corp., a Delaware
corporation  ("Borrower"),  and guaranteed by the guarantors  listed on Schedule
"1" hereto  ("Guarantors"),  with Bank One, Arizona,  NA acting as agent for the
Banks ("Agent")

Ladies & Gentlemen:

         I am general counsel of Borrower and Guarantors.  Each capitalized term
used and not otherwise defined in this letter shall have the meaning ascribed to
such term in the documents  listed on Schedule 2 attached hereto  (collectively,
the "Documents").  In addition, as used in this letter, the phrase "consummation
of the modification", means the closing of the loan modification contemplated in
the  Modification  Agreement  and  the  performance  of  the  obligations  to be
performed  by  Borrower  and  Guarantors  prior  to  the  closing  of  the  loan
modification but does not include  performance of obligations or compliance with
terms  and   conditions  of  the  Documents   after  the  closing  of  the  loan
modification.

         For purposes of this letter,  I have examined such questions of law and
fact and such documentation as I have determined to be necessary or appropriate.
<PAGE>
         Based on the foregoing and subject to the assumptions,  qualifications,
and limitations set forth below, it is my opinion that:

         1. Borrower has the requisite  corporate power and corporate  authority
to carry out the terms and conditions applicable to it under the Documents.  The
execution,  delivery and  performance of the Documents by Borrower has been duly
authorized  by all  requisite  corporate  action on the part of Borrower and the
consent or approval of shareholders  of Borrower is not required.  The Documents
have been duly executed and delivered on behalf of Borrower.

         2. Each  Guarantor  has the  requisite  corporate  power and  corporate
authority  to carry  out the  terms and  conditions  applicable  to it under the
Documents.  The execution,  delivery,  and  performance of the Documents by each
Guarantor has been duly authorized by all requisite corporate action on the part
of each such  Guarantor  and the  consent or approval  of  shareholders  of such
Guarantor is not required.  The Documents  have been duly executed and delivered
on behalf of each such Guarantor.

         3. The execution and delivery of the Documents and  consummation of the
modification  by Borrower will not conflict with, or result in violation of, any
applicable  law,  ordinance,  regulation  or  rule  (federal,  state  or  local)
affecting Borrower of which I am aware,  except for such conflicts or violations
which would not be reasonably  likely to result in a Material Adverse Effect. By
the foregoing opinion,  I do not intend to express,  and you agree that I do not
express,  any opinion  concerning any securities law,  regulation or rule or any
law,  regulation,  or rule  regulating  the making of secured  loans by banks or
non-banking subsidiaries of bank holding companies.

         4. The execution and delivery of the Documents and  consummation of the
modification  by each Guarantor will not conflict with, or result in a violation
of, any applicable law, ordinance,  regulation or rule (federal, state or local)
affecting  any  Guarantor  of which I am aware,  except  for such  conflicts  or
violations which would not be reasonably  likely to result in a Material Adverse
Effect. By the foregoing opinion, I do not intend to express, and you agree that
I do not express, any opinion concerning any securities law, regulation, or rule
or any law, regulation,  or rule regulating the making of secured loans by banks
or non-banking subsidiaries of bank holding companies.

         5. No consent, approval,  authorization,  or other action by, or filing
with,  any  federal,  state,  or local  governmental  authority  is  required in
connection  with the execution and delivery by Borrower of the Documents and the
consummation  of the  modification,  other than those  which have been  obtained
prior to the consummation of the modification.

         6. No consent, approval,  authorization,  or other action by, or filing
with,  any  federal,  state,  or local  governmental  authority  is  required in
connection with the execution and delivery by any Guarantor of the Documents and
the consummation of the  modification  other than those which have been obtained
prior to the consummation of the modification.
<PAGE>
         7. The execution and delivery of the Documents and  consummation of the
modification  by Borrower will not conflict with or result in a violation of the
Articles of Incorporation and Bylaws of Borrower.

         8. The execution and delivery of the Documents and  consummation of the
modification  by each  Guarantor will not conflict with or result in a violation
of the Articles of Incorporation and Bylaws of any such Guarantor.

         9. The Documents  constitute legal,  valid, and binding  obligations of
Borrower, enforceable in accordance with their terms against Borrower.

         10. The Documents  constitutes legal, valid, and binding obligations of
each  Guarantor,  enforceable  in  accordance  with  their  terms  against  each
Guarantor.

         11. The execution and delivery of the Documents and consummation of the
modification  by Borrower  will not conflict  with, or result in a violation of,
any  such  judgments,  orders,  or  decrees  of any  arbitrator,  other  private
adjudicator,  court, or  governmental  authority  (federal,  state, or local) to
which  Borrower is a party or by which  Borrower or the  property of Borrower is
bound,  except for such conflicts or violations  which, in the aggregate,  would
not be reasonably likely to result in a Material Adverse Effect.

         12. The execution  and delivery of the Documents by each  Guarantor and
consummation  of the  modification  by each Guarantor will not conflict with, or
result  in a  violation  of,  any such  judgments,  orders,  or  decrees  of any
arbitrator,   other  private  adjudicator,   court,  or  governmental  authority
(federal,  state,  or local) to which any such  Guarantor is a party or by which
such  Guarantor  or the  property of such  Guarantor  is bound,  except for such
conflicts or violations which, in the aggregate,  would not be reasonably likely
to result in a Material Adverse Effect.

         13. The execution and delivery of the Documents and consummation of the
modification  by Borrower  will not conflict  with, or result in a violation of,
any contract,  or any other  agreement to which Borrower is currently a party or
by which it is currently bound (except for the Indenture,  the Old Indenture and
the Convertible Notes Indenture as to which I express no opinion).

         14. The execution and delivery of the Documents and consummation of the
modification  by each Guarantor will not conflict with, or result in a violation
of, any contract,  or any other agreement to which such Guarantor is currently a
party or by which it is  currently  bound  (except  for the  Indenture,  the Old
Indenture and the Convertible Notes Indenture as to which I express no opinion).

         15. I have no actual  knowledge  of any  pending or overtly  threatened
litigation or other proceeding before any arbitrator, other private adjudicator,
court, or governmental agency (federal,  state or local) against Borrower which,
in the  aggregate,  would be reasonably  likely to result in a Material  Adverse
Effect.
<PAGE>
         16. I have no actual  knowledge  of any  pending or overtly  threatened
litigation or other proceeding before any arbitrator, other private adjudicator,
court, or governmental  agency  (federal,  state or local) against any Guarantor
which,  in the  aggregate,  would be  reasonably  likely to result in a Material
Adverse Effect.

         In rendering the foregoing opinions I have assumed with your permission
and without investigation:

                  (i) The  genuineness  of the  signatures  not  witnessed,  the
authenticity  of  documents  submitted  as  originals,  and  the  conformity  to
originals of documents submitted as copies;

                  (ii) The legal capacity of all natural  persons  executing the
Documents;

                  (iii) The  Documents  accurately  describe  and  contain  your
understanding, and there are no oral or written statements or agreements by you,
that modify,  amend,  or vary, or purport to modify,  amend, or vary, any of the
terms of the Documents;

                  (iv) Borrower owns all  property,  interests in property,  and
rights purported to be owned by it;

                  (v) Each Bank is a national  banking  association or a federal
savings bank validly existing under the law of the United States of America;

                  (vi) Agent and each Bank have the  requisite  corporate  power
and corporate authority to carry out the terms and conditions applicable to them
under the Documents,

                  (vii) The execution, delivery and performance of the Documents
by Agent and each Bank have been  duly  authorized  by all  requisite  corporate
action on their part; and

                  (viii) The  Documents  executed by any person or entity  other
than Borrower or Guarantors  or containing  obligations  of any person or entity
other than Borrower or Guarantors,  are the legal, valid and binding obligations
of such person or entity,  enforceable  in  accordance  with their terms against
such person or entity.

         The   opinions   set  forth   above  are   subject  to  the   following
qualifications and limitations:

                  (a) The validity and  enforceability  of the  Documents may be
subject  to,  or  limited  by,  (i)  any  applicable   bankruptcy,   insolvency,
reorganization,  arrangement, moratorium, or fraudulent transfer laws (including
without  limitation,  Section 548 of the Federal  Bankruptcy  Code) or any other
laws or judicial decisions  affecting  creditors' rights and remedies generally;
(ii) general  principles of equity;  (iii) forfeiture or similar laws (including
court  decisions) of the State of Arizona or of the United States;  and (iv) the
rights and  remedies  of the Pension  Benefits  Guaranty  Corporation  under the
Employee  
<PAGE>
Retirement  Income  Security  Act of 1974,  or of the  United  States  under the
Federal Tax Lien Act of 1966.

                  (b) The  enforceability of the Documents is further subject to
the  qualification  that  certain  waivers,   procedures,   remedies  and  other
provisions of the Documents may be  unenforceable  under, or limited by, the law
of the State of  Arizona.  However,  such  limitations  do not,  in my  opinion,
interfere (i) with  practical  enforcement  by you of the obligation of Borrower
under the Documents to pay to you the principal  amount of the Loan and interest
thereon as provided in the Notes,  or (ii) with practical  enforcement by you of
the  obligation  of each  Guarantor  under the Guaranty to pay to you the unpaid
principal  amount of the Loan and interest thereon as provided in the Notes upon
failure by Borrower to pay such principal  amount and interest when due,  except
(A) with respect to (i) and (ii) for the economic consequences of any procedural
delays that may result from such  limitations,  and (B) with respect to (ii), on
the basis of events,  actions,  or  circumstances  that may occur or arise after
consummation  of the Loan,  the law of guaranty and  suretyship  may prevent the
enforcement of the Guaranty.

                  (c) I express  no  opinion  with  respect  to your  ability to
enforce the  Documents  against  Borrower or any  Guarantor if the Loan fails to
comply with any statutory, regulatory or other loan limits applicable to you, or
if the Loan fails to comply with any other state or federal law (including court
decisions),   rule  or  regulation  which  prescribes   permissible  and  lawful
investments for you (either as to type, amount, percentage of total investments,
or otherwise).

         I am qualified  to practice  law in the State of Arizona.  The opinions
expressed  in this  letter are based upon the  presently  effective  laws of the
State of Arizona only,  and I assume no obligation to revise or supplement  this
opinion should such law be changed by legislative action,  judicial decision, or
otherwise.  I  express  no  opinion  with  respect  to the  laws  of  any  other
jurisdiction.  The opinions  expressed  herein are limited to the matters stated
herein and no opinion is implied or may be inferred beyond the matters expressly
stated.

         This opinion is rendered  solely to you and solely in  connection  with
the Loan and may not be relied upon by you or by any other  person for any other
purpose,  provided,  however, that this opinion may be relied upon by any person
to  which  all or a  part  of  the  Loan,  or a  participation  therein,  may be
transferred, provided that such reliance is only in connection with the Loan and
that this opinion  remains  effective only as of the date hereof and will not be
considered to be effective or restated as of any other date. This opinion is not
to be referred to, or quoted, in any document, report, or financial statement or
filed with, or delivered to, any  governmental  agency or other person or entity
without  my prior  written  consent,  provided,  however,  this  opinion  may be
delivered  to  your   auditors,   governmental   regulators,   transferees   and
participants of any person entitled to rely on this opinion.

                                        Very truly yours,

                                      /s/Timothy C. Westfall
                                      ----------------------

                                        Timothy C. Westfall
<PAGE>
                                   SCHEDULE 1
                                   ----------

                                 ("Guarantors")



                 Acheter, Inc.
                 CH Mortgage Company
                 CHI Construction Company
                 CHI Finance Corp.
                 Continental Homes, Inc.
                 Continental Homes of Florida, Inc.
                 Continental Homes of Texas, Inc.
                 Continental Ranch, Inc., formerly known as Rancho Carillo, Inc.
                 KDB Homes, Inc.
                 L & W Investments Inc.
                 Milburn Investments, Inc.
                 Miltex Management, Inc.
                 Miltex Mortgage of Texas Limited Partnership
                 R.O.S. Corporation
                 Settlement Corporation
                 Travis County Title Company
<PAGE>
                                   SCHEDULE 2
                                   ----------

                                List of Documents


I.       First Modification  Agreement,  dated April 11, 1997, between Borrower,
Banks and Agent, with Consent and Agreement of Guarantors, dated April 11, 1997,
by Guarantors for the benefit of Banks and Agent ("Modification Agreement").

II.      Promissory  Note,  dated April 11,  1997,  in the  principal  amount of
$30,000,000 executed by Borrower payable to Guaranty Federal Bank, FSB.

III.     Letter  Agreement  dated April 11, 1997 between  Borrower and Bank One,
Arizona, NA.

     (The documents identified above are hereinafter collectively referred to as
the "Documents".)