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                                                                  EXHIBIT 10.4.2

                    FIRST AMENDMENT TO EMPLOYMENT AGREEMENT

        This is the first amendment to the Employment Agreement dated on or
about March 9, 1998, by and between American Home Mortgage Corp. and James
O'Reilly (the "Employment Agreement") and is made on February 1, 2001.

        1  The defined terms set forth in the Employment Agreement shall be
           given their same meaning in this amendment

        2  Section 5, subsection (c) of the Employment Agreement is omitted in
           its entirety and replaced with the following:

           A portion of the profit from secondary market activities, secondary
           market activities being defined as the aggregate difference for all
           loans sold during a month, between the price the Company receives for
           a loan and the price the company would have received for the loan had
           it sold the loan to the best efforts investor offering the highest
           price for the loan, that resulting total plus or minus the gain or
           less from hedging activities allocated to the month. For the purpose
           of this subsection, best efforts investors shall be limited to those
           investors to which the company has sold loans, and the twenty largest
           buyers of whole mortgage loans in the United States based on league
           tables for the previous year. For the purposes of this subsection,
           highest price shall be based on the lock-in period granted a
           customer. For the purposes of this subsection, hedging activities
           shall include pairing-out of unfulfilled forward sales contracts and
           options trading.

           The portion of the profit that shall be paid as a monthly bonus is
           as follows:

<TABLE>
<CAPTION>
           Profit from Secondary Marketing Activities         Portion (percentage) that shall be
                                                              paid to the Executive as bonus
         <S>                                                    <C>
           First $100,000 of monthly profit........................ 10%
           Next $150,000 of monthly profit.........................  9%
           Next $300,000 of monthly profit.........................  5%
           Next $500,000 of monthly profit.........................  3%
           Profits exceeding $1,050,000 per month..................  2%
</TABLE>

           If there is a loss from secondary marketing activity during a given
           month, such loss will be offset against profits in the subsequent
           month, or if necessary months, until the amount of the loss is fully
           offset. In a month for which a profit is being offset by a previous
           loss, the profit from secondary marketing activities upon which the
           bonus is calculated will be the amount of profit for the month less
           the amount of the loss being offset.

           Bonuses due to the Executive pursuant to this Section shall be
           calculated by the company and paid to the Executive no later than
           thirty days after the close of a month. If the Executive disagrees
           with the amount paid for a given month, he will notify the Company
           within ten days. Absent such notification, the amount paid shall be
           deemed correct.

           The Executive agrees that his first responsibility is to protect the
           company from interest rate risk, and that he will not engage in
           practices that expose the company to material losses due to a change
           in interest rates. The Executive agrees that profits from secondary
           marketing activity will be earned by 1) selling loans on a mandatory
           basis and hedging the resulting interest rate risk, 2) selling loans
           in bulk, 3) negotiating favorable sale terms with investors, 4)
           taking advantage of opportunities due to investors continuing to
           offer a set price as the market changes, and 5) other opportunities
           that do not create material interest rate risk.

        3  The amount due and unpaid the Executive as of this date is $150,000,
           and no additional amount for past services or previous periods is
           due.

        4  All other terms of the Employment Agreement remain unchanged.

        IN WITNESS WHEREOF, the parties hereto have caused this amendment to be
duly executed on February 1, 2001.


                                American Home Mortgage Corp.


                                By: /s/ Michael Strauss
                                    ----------------------------------
                                    Name:   Michael Strauss
                                    Title:  President


                                /s/ James O'Reilly
                                ---------------------------------------
                                James O'Reilly