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                                                                    EXHIBIT 10.4
                                                                    ------------
                                                                                

                    AGREEMENT TO INCREASE COMMITMENT AMOUNT
                    ---------------------------------------

        THIS AGREEMENT TO INCREASE COMMITMENT AMOUNT (the "Agreement"), dated as
of September 1, 1998, is by and among NEW CENTURY MORTGAGE CORPORATION, a
California corporation (the "Company"), U.S. BANK NATIONAL ASSOCIATION, formerly
known as First Bank National Association as agent (the "Agent") for the Lenders
party to the Third Amended and Restated Credit Agreement described below, and
GUARANTY FEDERAL BANK, FSB (the "Increasing Lender").

                                    Recitals
                                    --------

     A.   The Company, the Agent and the Lenders are parties to that certain
Third Amended and Restated Credit Agreement dated as of May 29, 1998 (the
"Credit Agreement").

     B.   The Company and the Agent desire to increase the commitment of the
Increasing Lender with a Warehousing Commitment as herein set forth-

     C.   This Agreement is delivered to the Agent by the Company and the
Increasing Lender pursuant to Section 8.06(b) of the Credit Agreement.

    NOW, THEREFORE, in consideration of the premises herein contained and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

                                   Article I
                                   ---------
                                  Definitions
                                  -----------

    Section 1.01. Incorporated Definitions.  Capitalized terms used in this
                  ------------------------                                 
Agreement, to the extent not otherwise defined herein, shall have the same
meanings as in the Credit Agreement.

                                   Article II
                                   ----------

                        Concerning the Increasing Lender
                        --------------------------------

Section 2.01. Commitment.  The Warehousing Commitment of the Increasing Lender
shall be FIFTY FIVE MILLION DOLLARS ($55,000,000.00). Schedule 1.01(b) of the
Credit Agreement is hereby amended and restated in its entirety to read as set
forth in Schedule 1.01 (b) hereto.
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                                  Article III
                                  -----------

                              Conditions Precedent
                              --------------------

    Section 3.01. Delivery of Documents.  The obligation of the Increasing
                  ---------------------                                   
Lender to make Advances shall be subject to the delivery to the Agent by the
Company of the following documents:

    (a) a promissory note in the form of Exhibit F to the Credit Agreement,
    payable to the Increasing Lender, in the principal amount of the Increasing
    Lender's Warehousing Commitment;

    (b) a certificate of the Secretary or Assistant Secretary of the Company
    certifying (i) resolutions of the Company's Board of Directors authorizing
    the execution, delivery and performance of this Agreement and the Increasing
    Lender's Warehousing Note and identifying the officers of the Borrower
    authorized to sign such instruments, and (ii) specimen signatures of the
    officers so Authorized; and

    (c) such other documents as the Agent or the Increasing Lender may
    reasonably request.

                                   Article IV
                                   ----------

                                 Miscellaneous
                                 -------------

    Section 4.01. Applicable Law.  This Agreement shall be governed by and
                  --------------                                          
construed in accordance with the internal law, and not the law of conflicts, of
the State of Minnesota, but giving effect to federal laws applicable to national
banks.

    Section 4.02. Counterparts.  This Agreement may be executed in one or more
                  ------------                                                
counterparts, each of which when so executed shall be deemed to be an original,
but all of which when taken together shall constitute one and the same
instrument.

                                       2
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IN WITNESS WHEREOF, the undersigned have caused this instrument to be executed
as of the date first above written.

                                       NEW CENTURY MORTGAGE          
                                       CORPORATION                   
                                                                     
                                                                     
                                       By:  /s/ E. F. Gotschall       
                                            -------------------       
                                       Its: CFO                  
                                            ------------------- 
                                                                     
                                                                     
                                                                     
                                       GUARANTY FEDERAL BANK, F.S.B. 
                                                                     
                                                                     
                                       By:  /s/ W. James Meintjes     
                                            ---------------------     
                                       Its: Vice President       
                                            ---------------------       
                                                                     
                                                                     
                                                                     
                                       U.S. BANK NATIONAL            
                                       ASSOCIATION, as Agent         
                                                                     
                                                                     
                                       By:  /s/ Edwin Jenkins         
                                            ------------------         
                                       Its: Vice President       
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