<PAGE>
 
                                                                    EXHIBIT 10.5

                             TERMINATION AGREEMENT


    THIS TERMINATION AGREEMENT (the "Agreement") is made as of the 26th day of
June, 1998, by and among New Century Mortgage Corporation, a California
corporation ("New Century"), Comerica Bank, a Michigan banking corporation,
successor to Comerica Mortgage Corporation, ("Comerica") and Comerica
Incorporated, a Delaware Corporation ("CI").

                                   BACKGROUND

    A.  New Century and Comerica are parties to that certain Servicing Agreement
dated as of September 15, 1997 whereby New Century appointed Comerica to perform
certain servicing obligations for New Century's Mortgage Loans (capitalized
terms not defined herein shall have the meaning assigned to them in the
Servicing Agreement).

    B.  Comerica has indicated that it is no longer servicing residential
mortgage loans and desires to terminate the Servicing Agreement with New Century
prior to the end of the contract term.

    C.  New Century is establishing additional servicing operations to take over
the Servicing Duties being performed by Comerica.

    D.  CI has rights pursuant to that certain Stock Purchase Agreement dated
as of May 30, 1997 between CI and New Century Financial Corporation, a Delaware
corporation, ("NCFC") to receive warrants (the "Warrants") to purchase 50,000
shares of NCFC upon completion of one year of operations under the Servicing
Agreement, provided that at the end of such year Comerica is not in material
default under or in material breach of the terms of the Servicing Agreement
after having had an opportunity to cure.

    E.  As part of their efforts to effect an orderly transition of the
Servicing Duties from Comerica to New Century, the parties desire formally to
document the termination of Servicing Agreement and the forfeiture of the rights
to receive the Warrants.
<PAGE>
 
                                   AGREEMENT

    NOW THEREFORE, in consideration of the premises and mutual covenants
hereinafter set forth, the parties hereto, intending to be legally bound, hereby
agree as follows:

1. Termination of Servicing Agreement
   ----------------------------------

   1.1.  The Effective Date.  The parties hereby agree to terminate the
         ------------------                                            
         Servicing Agreement effective as the date on which the parties have
         completed the transfer of the servicing portfolio and all Servicing
         Duties under the Servicing Agreement to New Century (the "Effective
         Date"). The parties currently contemplate a July 1, 1998 Effective
         Date, but in no event will the Effective Date be later than August 1,
         1998. On the Effective Date, the parties will sign and deliver to each
         other a Termination Certificate in the form of Exhibit A hereto to
         effect the termination.

   1.2.  Termination of Rights and Obligations.  On the Effective Date, all
         -------------------------------------                             
         rights and obligations of the parties under the Servicing Agreement
         shall cease, except for those rights and obligations which expressly
         survive termination of the Servicing Agreement, including, without
         limitation, the following:

         (a) Comerica's obligation under Section 4(d) of the Servicing Agreement
             to endorse and remit directly and promptly to New Century any
             collections received by Comerica after the Effective Date;

         (b) Comerica's entitlement to the benefits of Section 6 of the
             Servicing Agreement (Limitation on Liability of Comerica and
             Others);

         (c) Comerica's obligation pursuant to Section 8 of the Servicing
             Agreement (to the extent required by New Century) to provide an
             Annual Statement as to Compliance for the portion of the current
             fiscal year for which Comerica performed Servicing Duties;

         (d) Comerica's obligation pursuant to Section 9 of the Servicing
             Agreement to provide an Annual Independent Certified Public
             Accountant's Report with respect to the current fiscal year (the
             Mortgage Bankers Uniform Single Attestation Program (USAP) letter);
             an d

         (e) Comerica's non-competition obligations pursuant to Section 11 (l)
             of the Servicing Agreement.

                                       2
<PAGE>
 
2.  The Transition Period.
    --------------------- 

    In order to effect a smooth transition, the parties agree that during the
    period from the date hereof to the Effective Date (the "Transition Period"),
    each will cooperate with the other in good faith for the purpose of
    transferring the Servicing Duties to New Century with a minimum of
    disruption, cost and inconvenience. Each party covenants to sign such
    documents, provide such information and do such other things as the parties
    deem reasonably necessary to accomplish this purpose.

    Without limiting the generality of the foregoing, the parties specifically
    undertake to perform the transition tasks listed in Exhibit B hereto (the
    "Transition Tasks").


3.  Payment of Alltel Pass-through and Related Comerica Expenses
    ------------------------------------------------------------

    In accordance with a verbal agreement reached by the parties on March 23,
    1998, New Century hereby agrees to reimburse Comerica for the following (the
    "Alltel Expenses"): (i) all expenses incurred by Comerica from Alltel in
    connection with goods and services provided by Alltel for the purpose of
    enabling Comerica to perform its Servicing Duties, and (ii) 50% of the
    Comerica information systems expenses incurred in implementing the Alltel
    system, (iii) 50% of the Comerica default management consulting fees.

    Comerica has provided New Century detailed invoices in Exhibit D reflecting
    the Alltel expenses that Comerica has been billed for to date.  Comerica
    will allow New Century a reasonable period of time to review the invoices
    and confirm that they reflect legitimate Alltel Expenses.

    Further, Comerica and New Century acknowledge that invoices will be prepared
    by Comerica in the form of Exhibit D and sent to New Century reflecting
    amounts that are currently accruing but for which Comerica has not yet been
    billed by Alltel.  New Century will, after a reasonable time to review but
    no later than 10 business days after receipt of such invoices, reimburse
    Comerica for any and all pass-through expenses that are attributable to New
    Century's servicing activities.


4.  Waiver of Termination-Related Costs
    -----------------------------------

    The parties recognize that each will incur costs and suffer inconveniences
    relating to the transfer of the Servicing Duties and the Mortgage Loans to
    New Century. To this end, the parties hereby acknowledge that New Century'
    payment of the Alltel Expenses will constitute full and final compensation
    for any and all costs and expenses incurred by Comerica as a result of or in
    connection with the termination.

                                       3
<PAGE>
 
    The parties hereby agree to waive any such other transition costs as
    follows:

    a. Comerica Waiver.  Except for the Alltel Expenses, Comerica hereby
       releases New Century from, and waives any and all rights to pursue New
       Century for, the termination fees set forth in Exhibit A to the Servicing
       Agreement, (ii) any other deboarding or similar fees and any other costs
       Comerica incurred or will incur related to the transfer of the portfolio
       and the Servicing Duties to New Century, and (iii) except as provided for
       in section 3 above, information systems and other costs Comerica incurred
       in support of New Century's servicing needs.

    b. New Century Waiver.  New Century hereby releases Comerica from, and
       waives any and all rights to pursue Comerica for, (i) costs related to
       the transfer of the Servicing Duties and reboarding of the servicing
       portfolio, and (ii) any other costs New Century incurred as a result of
       Comerica's decision to resign from its obligations and duties under the
       Servicing Agreement.

5.  Forfeiture of Warrants
    ----------------------

    Within 5 days after the Effective Date, CI agrees that it will deliver to
    NCFC a letter in the form of Exhibit C hereto acknowledging that it has
    forfeited its rights to receive the Warrants.


6.  Miscellaneous
    -------------

    The provisions of Section 11(a) through 11(k) of the Servicing Agreement
    are hereby incorporated by reference to apply to this Agreement.

                                       4
<PAGE>
 
IN WITNESS WHEREOF, the parties have caused this Termination Agreement to be
executed and delivered by their properly authorized officers as of the date
first above written.

                     NEW CENTURY MORTGAGE CORPORATION

                     /s/  Brad A. Morrice
                     -----------------------------
                     By:  Brad A. Morrice
                     Its: Chief Executive Officer


                     COMERICA BANK

                     /s/  John R. Haggerty
                     -----------------------------
                     By:  John Haggerty
                     Its: Executive Vice President


                     COMERICA INCORPORATED

                     /s/  John R. Haggerty
                     -----------------------------
                     By:  John Haggerty
                     Its: Executive Vice President

                                       5
<PAGE>
 
                                                                       EXHIBIT A



                            TERMINATION CERTIFICATE


New Century Mortgage Corporation and Comerica Bank are parties to that certain
Termination Agreement, dated June        , 1998 (the "Termination Agreement")
                                  -------
terminating that certain Servicing Agreement, dated as of September 15, 1997,
between them (the "Servicing Agreement").

The parties hereby acknowledge and agree that today,           , 1998 is the
                                                     ----------
Effective Date under the Termination Agreement for termination of the Servicing
Agreement.

This Termination Certificate may be executed simultaneously in two counterparts,
each of which shall be deemed to be an original, and together will constitute
one and the same instrument.


In Witness Whereof, the parties have caused this Termination Certificate to be
executed and delivered by their proper and duly authorized officers as of
                 ,1998.
-----------------

NEW CENTURY                                      COMERICA BANK
MORTGAGE CORPORATION


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

                                       6
<PAGE>
 
                                                                       EXHIBIT B


                                TRANSITION TASKS

COMERICA

1.   During the Transition Period, Comerica will continue to perform its
     required Servicing Duties with the same care and according to the same
     standards Comerica uses in servicing its own mortgage loans.

2.   Comerica will board loans received from New Century on or before June 12,
     1998.

3.   As soon as practicable, but no later than June 19, 1998, Comerica will
     process loan transfers for all loans sold by New Century in June 1998.

4.   On or before the 15th day before the Effective Date, Comerica must send to
     all Mortgage Loan customers a "goodbye" letter in form satisfactory to New
     Century.

5.   Upon receipt of payment in full of all amounts due and billed for to date
     under this termination agreement, Comerica will transfer and assign to New
     Century its rights to the Electronic Loan Interface (ELI) software
     developed by Alltel which Comerica has purchased to be used to service
     mortgage loans for New Century. Such transfer and assignment will be
     effected through the execution of the Transfer & Assignment Agreement in
     the form of Exhibit E.

6.   The night of the Effective Date, Comerica will place stops on all Mortgage
     Loans.

7.   On the Effective Date, Comerica will service-release New Century's Mortgage
     Loans.

8.   Three days after the Effective Date, Comerica will cease initiating debits
     or credits to New Century's bank account (# 1850519149).

9.   Comerica will wire to New Century's designated account within 5 days after
     the Effective Date all escrowed Tax and Insurance funds, and will remit all
     escrowed Principal and Interest funds to the trustee on July 18, 1998.

10.  New Century will allow Comerica to retain its files relating to the
     Mortgage Loans it had been servicing under the Servicing Agreement.
     Comerica agrees not to use these files for the purposes of soliciting
     mortgage loans or to disclose or sell any information contained therein to
     third parties.

                                       7
<PAGE>
 
11.  New Century will pay Comerica for transitional use of and sufficient access
     for New Century's transitional needs to the MSP System and/or the Passport
     Computer System for a period not to exceed 20 days after the Effective
     Date. Such access will be limited to the same security levels established
     for users on record as of June 23, 1998. The number of transitional users
     will established on a list provided by New Century to Comerica on or before
     the Effective Date but will not exceed 10 users. The amount of payment for
     this access will be determined in the same manner all other pass-through
     expenses have been to date in the form of Exhibit D.


NEW CENTURY

1.   New Century will pay Comerica the Alltel and Related Expenses billed to
     date reasonably promptly after receipt from Comerica of the invoices in
     Exhibit D, but no later than June 26, 1998. Further, New Century releases
     Comerica from any liability relative to Alltel's ability to install the ELI
     software on New Century's system in a timely manner.

2.   New Century will board with Comerica any remaining unboarded loans from New
     Century's March 1998 securitization no later than June 25, 1998.

3.   New Century will provide to Comerica by the Effective Date escrow account
     wire instructions so that Comerica may wire escrow funds to New Century's
     new custodial accounts.

                                       8
<PAGE>
 
                                                                       EXHIBIT C
                       FORM OF LETTER REGARDING WARRANTS
                       [COMERICA INCORPORATED LETTERHEAD]

                                         [date]

New Century Financial Corporation
18400 Von Karman, Suite 1000
Irvine, California 92612

Attn:  Robert K. Cole
       Chairman and Chief Executive Officer

       Re:    Warrants

Dear Mr. Cole:

On ______, 1998 Comerica Mortgage Corporation ceased performing the Servicing
Duties under the Servicing Agreement dated as of September 15, 1997 between
Comerica Mortgage Corporation and New Century Mortgage Corporation.

In light of this fact, Comerica Incorporated ("CI") hereby acknowledges that
certain rights of CI pursuant to Article VI(ii) of the May 30, 1997 Stock
Purchase Agreement between CI and New Century Financial Corporation ("NCFC") to
receive warrants to purchase 50,000 shares of NCFC have been terminated and are
of no further force or effect.

                               Very truly yours,

                               COMERICA INCORPORATED



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

                                       9
<PAGE>
 
                                                                       EXHIBIT D

                               COMERICA INVOICES

Following are the invoices Comerica has created and sent to New Century for
Alltel and Related Expenses incurred to date. Invoices for amounts accruing but
not yet billed for will be in the same format.


                            [Intentionally Omitted]

                                       10
<PAGE>
 
                                                                       EXHIBIT E

                      ELI TRANSFER & ASSIGNMENT AGREEMENT

Following is the Transfer and Assignment Agreement created to cover the legal
transfer of the Electronic Loan Interface (ELI) software from Comerica to New
Century.  The document also includes an acknowledgment from Alltel.

                                       11
<PAGE>
 
                       ASSIGNMENT and TRANSFER AGREEMENT


THIS AGREEMENT is made as of June 26, 1998 by and between Comerica,
Incorporated ("Comerica"), a Delaware bank holding company of Detroit,
Michigan, and New Century Mortgage Corporation ("New Century"), a California
corporation of Newport Beach, California.

WHEREAS, Alltel Information Services, Inc. ("Alltel") has developed and sold to
Comerica certain software referred to as the Electronic Loan Interface system
(the "Software"), which Software is used in connection with Comerica's
processing of residential mortgage and home equity loans (the "Loans") it
services and sub-services for New Century;

WHEREAS, Comerica and New Century have mutually agreed to terminate the
servicing and sub-servicing arrangements between the parties;

WHEREAS, New Century desires to obtain rights in the Software to facilitate
their servicing of the Loans.

NOW, THEREFORE, For a valuable consideration, receipt of which is hereby
acknowledged, Comerica and New Century agree as follows:

1.   Comerica agrees to assign and transfer to New Century all of its right,
title and interest in the Software and New Century accepts such assignment and
transfer.  This assignment and transfer shall include, without limitation, any
and all rights to modify the Software.

2.   This assignment and transfer is made 'as is', without representation,
warranty and recourse of any kind whatsoever.  This disclaimer of warranty shall
include, without limitation, any warranty of title and any warranty of fitness
for a particular purpose.

3.   New Century agrees to hold Comerica harmless for any and all losses it may
suffer as a result of use of the System, unless such loss is due to the gross
negligence or willful misconduct of Comerica.

The parties hereto execute this Agreement as of the date specified above.


       COMERICA, INCORPORATED         NEW CENTURY
                                      MORTGAGE CORPORATION
       By: /s/  John R. Haggerty      By: /s/  Brad A. Morrice
          ----------------------         ---------------------
       Its:   CEO                      Its:     CEO
           ---------------------           -------------------
<PAGE>
 
                                 ACKNOWLEDGMENT


This Acknowledgment is attached to and a part of that certain Assignment and
Transfer Agreement dated as of ________________, 1998, by and between Comerica,
Incorporated and New Century Mortgage Corporation. Capitalized terms used in
this Acknowledgment shall have the meaning ascribed to them in the Agreement.

The undersigned, Alltel Information Services, Inc., has developed and sold the
Software for use by Comerica.  The undersigned acknowledges the transfer of the
Software by Comerica to New Century.  The undersigned agrees that such transfer
does not violate the terms of any agreement between the undersigned and Comerica
regarding the development, sale or maintenance of the Software.

ALLTEL INFORMATION SERVICES, INC.
By:
   ---------------------- 
   Its:
       ------------------
<PAGE>
 
                       ASSIGNMENT and TRANSFER AGREEMENT


THIS AGREEMENT is made as of _________, 1998 by and between Comerica,
Incorporated ("Comerica"), a Delaware bank holding company of Detroit,
Michigan, and New Century Mortgage Corporation ("New Century"), a California
corporation of Newport Beach, California.

WHEREAS, Alltel Information Services, Inc. ("Alltel") has developed and sold to
Comerica certain software referred to as the Electronic Loan Interface system
(the 'Software"), which Software is used in connection with Comerica's
processing of residential mortgage and home equity loans (the "Loans") it
services and sub-services for New Century;

WHEREAS, Comerica and New Century have mutually agreed to terminate the
servicing and sub-servicing arrangements between the parties;

WHEREAS, New Century desires to obtain rights in the Software to facilitate
their servicing of the Loans.

NOW, THEREFORE, For a valuable consideration, receipt of which is hereby
acknowledged, Comerica and New Century agree as follows:

1.   Comerica agrees to assign and transfer to New Century all of its right,
title and interest in the Software and New Century accepts such assignment and
transfer.  This assignment and transfer shall include, without limitation, any
and all rights to modify the Software.

2.   This assignment and transfer is made 'as is', without representation,
warranty and recourse of any kind whatsoever.  This disclaimer of warranty shall
include, without limitation, any warranty of title and any warranty of fitness
for a particular purpose.

3.   New Century agrees to hold Comerica harmless for any and all losses it may
suffer as a result of use of the System, unless such loss is due to the gross
negligence or willful misconduct of Comerica.

The parties hereto execute this Agreement as of the date specified above.


       COMERICA, INCORPORATED         NEW CENTURY
                                      MORTGAGE CORPORATION

       By:                            By: /s/  Brad A. Morrice
          -------------------            ---------------------
       Its:                           Its:     CEO
           ------------------             -------------------
<PAGE>
 
                                 ACKNOWLEDGMENT


This Acknowledgment is attached to and a part of that certain Assignment and
Transfer Agreement dated as of __________, 1998, by and between Comerica,
Incorporated and New Century Mortgage Corporation. Capitalized terms used in
this Acknowledgment shall have the meaning ascribed to them in the Agreement.

The undersigned, Alltel Information Services, Inc., has developed and sold the
Software for use by Comerica.  The undersigned acknowledges the transfer of the
Software by Comerica to New Century.  The undersigned agrees that such transfer
does not violate the terms of any agreement between the undersigned and Comerica
regarding the development, sale or maintenance of the Software.

ALLTEL INFORMATION SERVICES, INC.
By:
   ----------------------

   Its:
       -----------------