<PAGE> 31

                                                               EXHIBIT 10.1

                           SECOND AMENDED AND RESTATED
                    WAREHOUSING CREDIT AND SECURITY AGREEMENT

                         (SINGLE FAMILY MORTGAGE LOANS)

                                     BETWEEN

                         U.S. HOME MORTGAGE CORPORATION,

                              a Florida corporation

                                       AND

                        RESIDENTIAL FUNDING CORPORATION,

                             a Delaware corporation

                           Dated as of October 1, 1999

<PAGE> 32

         TABLE OF CONTENTS

                                                                      PAGE

                                                                       ----

         1.       DEFINITIONS                                            1

                  1.1      Defined Terms                                 1

                  1.2      Other Definitional Provisions                14

         2.       THE CREDIT                                            14

                  2.1      The Commitment                               14

                  2.2      Procedures for Obtaining Advances            15

                  2.3      Note                                         17

                  2.4      Interest                                     17

                  2.5      Principal Payments                           19

                  2.6      Expiration of Commitment                     23

                  2.7      Method of Making Payments                    23

                  2.8      Commitment Fees and Usage Fees               23

                  2.9      Warehousing Fees                             24

                  2.10     Miscellaneous Charges                        24

                  2.11     Interest Limitation                          25

                  2.12     Increased Costs; Capital Requirements        25

         3.       COLLATERAL                                            26

                  3.1      Grant of Security Interest                   26

                  3.2      Release of Security Interest in Collateral   28

                  3.3      Delivery of Additional Collateral or
                  Mandatory Prepayment                                  30

                  3.4      Release of Collateral                        30

                  3.5      Collection and Servicing Rights              31

                  3.6      Return of Collateral at End of Commitment    31
<PAGE> 33

         4.       CONDITIONS PRECEDENT                                  31

                  4.1      Effectiveness of this Agreement              31

                  4.2      Each Advance                                 33

         5.       REPRESENTATIONS AND WARRANTIES                        34

                  5.1      Organization; Good Standing; Subsidiaries    35

                  5.2      Authorization and Enforceability             35

                  5.3      Approvals                                    36

                  5.4      Financial Condition                          36

                  5.5      Litigation                                   36

                  5.6      Compliance with Laws                         36

                  5.7      Regulation U                                 37

                  5.8      Investment Company Act                       37

                  5.9      Payment of Taxes                             37

                  5.10     Agreements                                   37

                  5.11     Title to Properties                          38

                  5.12     ERISA                                        38

                  5.13     Eligibility                                  38

                  5.14     Place of Business                            39

                  5.15     Special Representations Concerning
                  Collateral                                            39

                  5.16     Servicing                                    42

                  5.17     Special Representations Concerning
                  Construction  Advances                                42

                  5.18     No Adverse Selection                         43

                  5.19     Year 2000 Compliance                         43


<PAGE> 34

         6.       AFFIRMATIVE COVENANTS.                                43

                  6.1      Payment of Note.                             43

                  6.2      Financial Statements and Other Reports       43

                  6.3      Maintenance of Existence; Conduct
                  of Business                                           46

                  6.4      Compliance with Applicable Laws              46

                  6.5      Inspection of Properties and Books           46

                  6.6      Notice                                       47

                  6.7      Payment of Debt, Taxes, etc                  47

                  6.8      Insurance                                    48

                  6.9      Closing Instructions                         48

                  6.10     Subordination of Certain Indebtedness        48

                  6.11     Other Loan Obligations                       48

                  6.12     Use of Proceeds of Advances                  49

                  6.13     Special Affirmative Covenants
                  Concerning Collateral                                 49

                  6.14     Special Affirmative Covenants Concerning
                  Construction Advances                                 50

         7.       NEGATIVE COVENANTS                                    50

                  7.1      Contingent Liabilities                       51

                  7.2      Sale or Pledge of Servicing Contracts        51

                  7.3      Merger; Sale of Assets; Acquisitions         51

                  7.4      Deferral of Subordinated Debt                51

                  7.5      Loss of Eligibility                          51

                  7.6      Debt to Tangible Net Worth Ratio             51

                  7.7      Minimum Tangible Net Worth                   51

                  7.8      Acquisition of Recourse Servicing Contracts  52

                  7.9      Gestation Facilities                         52

                  7.10     Special Negative Covenants Concerning
                  Collateral                                            52

<PAGE> 35

         8.       DEFAULTS; REMEDIES                                    52

                  8.1      Events of Default                            52

                  8.2      Remedies                                     56

                  8.3      Application of Proceeds                      60

                  8.4      Lender Appointed Attorney-in-Fact            60

                  8.5      Right of Set-Off                             60

         9.       NOTICES                                               61

         10.      REIMBURSEMENT OF EXPENSES; INDEMNITY                  61

         11.      FINANCIAL INFORMATION                                 62

         12.      MISCELLANEOUS                                         62

                  12.1     Terms Binding Upon Successors;
                  Survival of  Representations                          62

                  12.2     Assignment                                   63

                  12.3     Amendments                                   63

                  12.4     Governing Law                                63

                  12.5     Participations                               63

                  12.6     Relationship of the Parties                  63

                  12.7     Severability                                 64

                  12.8     Operational Reviews                          64

                  12.9     Consent to Credit References                 64

                  12.10    Consent to Jurisdiction                      64

                  12.11    Counterparts                                 65

                  12.12    Entire Agreement                             65

                  12.13    Waiver of Jury Trial                         65


<PAGE> 36

                                    EXHIBITS

                                    --------

Exhibit A                        Promissory Note

Exhibit B                        [INTENTIONALLY OMITTED]

Exhibit C-SF                     Request for Advance Against Single Family
                                 Mortgage Loans

Exhibit C-SF/CONSTRUCTION        Request for Advance Against
                                 Construction/Perm Mortgage Loans

Exhibit D-SF                     Procedures and Documentation for
                                 Warehousing Single Family Mortgage
                                 Loans

Exhibit D-SF/CONSTRUCTION        Procedures and Documentation for
                                 Warehousing Construction/Perm Mortgage Loans

Exhibit D-UNI                    Procedures and Documentation for
                                 Warehousing Unimproved Mortgage Loans

Exhibit E                        Schedule of Servicing Contracts

Exhibit F                        Subordination of Debt Agreement

Exhibit G                        Subsidiaries

Exhibit H                        Legal Opinion

Exhibit I-SF                     Officer's Certificate

Exhibit J                        Schedule of Existing Warehouse Lines

Exhibit K-1                      Funding Bank Agreement (Wire)

Exhibit K-2                      Funding Bank Agreement (Checks)

Exhibit L                        Commitment Summary Report

Exhibit M                        Terms Applicable to Advances Against
                                 Eligible Loans

Exhibit N                        RFConnects Pledge Agreement

<PAGE> 37

         THIS SECOND AMENDED  AND  RESTATED  WAREHOUSING  CREDIT AND  SECURITY
AGREEMENT, dated as of October 1, 1999 between U.S. HOME MORTGAGE CORPORATION,
a Florida corporation, (the "Company"), having its  principal  office  at  311
Park Place Boulevard, P.O. Box 4929, Clearwater, Florida 33759 and RESIDENTIAL
FUNDING CORPORATION,  a  Delaware   corporation (the  "Lender"),   having  its
principal  office  at  8400  Normandale   Lake  Blvd., Suite 600, Minneapolis,
Minnesota 55437.

         WHEREAS, the Company and the Lender have entered into a First Amended
and Restated  Warehousing Credit and Security Agreement dated August 31, 1995,
as  amended  by the First Amendment to First Amended and Restated  Warehousing
Credit   and   Security  Agreement   dated as of December 27, 1995, the Second
Amendment   to   First   Amended and  Restated Warehousing Credit and Security
Agreement dated as of   August 29, 1996,  the Third Amendment to First Amended
and  Restated  Warehousing  Credit  and   Security  Agreement  dated   as   of
January 2, 1997,   the   Fourth Amendment   to   First   Amended  and Restated
Warehousing   Credit  and  Security  Agreement  dated as of June 25, 1997, the
Fifth Amendment to First Amended and Restated  Warehousing Credit and Security
Agreement dated as of August 28, 1997, the Sixth  Amendment  to  First Amended
and Restated Warehousing Credit and Security Agreement dated as  of March  30,
1998, the Seventh Amendment to First Amended and Restated  Warehousing  Credit
and Security  Agreement dated as of July 17, 1998, and the Eighth Amendment to
First Amended and Restated Warehousing Credit and Security Agreement  dated as
of April 9,  1999,  (as so  amended, the "Existing  Credit Agreement");

         WHEREAS,  the  Company and the Lender desire to amend and restate the
Existing Credit Agreement  and  to  set  forth herein the terms and conditions
upon which the Lender shall  continue  to  provide  warehouse financing to the
Company;

         NOW, THEREFORE, the parties hereto hereby agree as follows:

1.       DEFINITIONS.

                  1.1  Defined  Terms.  Capitalized terms  defined  below  or
elsewhere in this Agreement (including  the Exhibits  hereto)  shall have the
following meanings:

                  "Adjusted Servicing Portfolio"  means,  for any Person,  the
Servicing Portfolio of such Person,  but excluding  the  principal  balance of
Mortgage Loans included in the Servicing  Portfolio at such date (a) which are
past due for principal or interest  for 60 days or more,  (b) with  respect to
which such Person is obligated to repurchase  or  indemnify  the holder of the
Mortgage  Loans  as  a  result  of  defaults on the Mortgage Loans at any time
during the term of such Mortgage Loans, (c) for which the Servicing  Contracts
are  not  owned  by such  Person  free and clear of all Liens  (other  than in
favor  of  the  Lender),  or  (d) which are serviced by the Company for others
under subservicing arrangements.

<PAGE> 38

                  "Adjusted   Tangible  Net  Worth" means with respect to any
Person at any date,  the  Tangible  Net  Worth  of  such Person at such date,
excluding capitalized excess servicing fees and capitalized servicing rights,
plus 1% of  the  Adjusted  Servicing  Portfolio,   and  plus  deferred  taxes
arising from capitalized excess  servicing  fees  and  capitalized  servicing
rights.

                  "Advance" means  a  disbursement by  the  ender  under  the
Commitment pursuant to Section 2.1 of this Agreement.

                  "Advance Request" has  the meaning set forth in Section 2.2
(a) hereof.

                  "Affiliate" has the meaning set forth in Rule  12b-2 of the
General Rules and Regulations under the Exchange Act.

                  "Agency Security" means a Mortgage-backed  Security  issued
or guarantied by Fannie Mae, Freddie Mac or Ginnie Mae.

                  "Agreement"  means   this  Second   Amended  and   Restated
Warehousing Credit and Security Agreement  (Single  Family  Mortgage  Loans),
either as originally executed or as it may from time to time be supplemented,
modified or amended.

                  "Approved Custodian"  means a pool custodian or other Person
which is  deemed acceptable  to the  Lender  from  time to  time  in its  sole
discretion to hold a Mortgage Loan for inclusion in a Mortgage Pool or to hold
a Mortgage Loan as agent for an Investor who has issued a Purchase  Commitment
for such Mortgage Loan.

                  "As Completed Appraised  Value"  means,  with  respect  to a
Construction/Perm  Mortgage  Loan,  the  value  given  by  a  state  certified
appraiser  prior to the beginning of any construction to the real property and
improvements  thereto  to  be  financed  by  such  Construction/Perm  Mortgage
Loan (i) as of the completion  of  construction  and (ii)  based on the  Total
Costs and plans and specifications for such real property and improvements.

                  "Business Day" means any day excluding  Saturday or Sunday
and excluding any day on which national banking associations are closed  for
business.

                  "Buydown" has the meaning set forth in Section 2.5(h)
hereof.

                  "Calendar  Quarter" shall mean the 3 month period beginning
on any January 1, April 1, July 1 or October 1.

                  "Cash Collateral Account" means a  demand  deposit  account
maintained  at the Funding Bank in the name of the Lender and  designated for
receipt of the proceeds of the sale or other disposition of the Collateral.

                  "Check Disbursement Account" means a demand deposit account
maintained  at  the  Funding  Bank  in  the name of the Company and under the
control of the Lender for  the  clearing  of checks written by the Company to
fund Advances.
<PAGE> 39

                  "Closing Date" means April 15, 1992.

                  "Collateral" has the meaning set forth in Section 3.1
hereof.

                  "Collateral Documents"  means, with respect to each Mortgage
Loan: (a) the Mortgage Note, the Mortgage, and all other documents executed in
connection with or otherwise relating to the Mortgage Loan, (b) as applicable,
the original lender's  ALTA  Policy  of  Title  Insurance  or its  equivalent,
documents evidencing the FHA  Commitment  to  Insure or the VA  Guaranty,  the
appraisal,  Private   Mortgage   Insurance,   the  Regulation   Z   Statement,
certificates  of  casualty  or  hazard  insurance, credit  information on  the
maker(s) of the Mortgage Note, the  HUD-1 or  corresponding  purchase  advice,
and (c) any other documents that are  customarily  desired  for  inspection or
transfer incidental to the  purchase  of any  Mortgage  Note  by  an  Investor
or which are  customarily executed by  the  seller  of  a  Mortgage Note to an
Investor.

                  "Collateral Value" means  (a) with respect to  any Eligible
Loan as of the date of  determination,  the lesser of (i) the  amount  of any
Advance made against such Eligible Loan under  Section  2.1(c) hereof or (ii)
the  Fair  Market  Value  of  such  Eligible  Loan;  (b) in the event Pledged
Mortgages have been exchanged  for Agency  Securities,  the lesser of (i) the
amount of  any Advances outstanding  against the Eligible  Loans backing such
Agency  Securities  or (ii) the Fair Market Value of such Pledged Securities;
and (c) with respect to cash, the amount of such cash.

                  "Commitment" has the meaning set forth in Section 2.1(a)
hereof.

                  "Commitment Amount" means $80,000,000.

                  "Commitment Fee"  means a fee  payable  by  the  Company  in
consideration of the Lender's  issuance of the  Commitment.  The amount of the
Commitment Fee, if any, is set forth in Section 2.8(a) hereof.

                  "Committed Purchase Price"  means for an  Eligible  Loan the
product of the Mortgage Note  Amount multiplied by (a) the price (expressed as
a percentage) as set forth in a Purchase  Commitment for such Eligible Loan or
(b) in the event such Eligible  Loan is to be used to back an Agency Security,
the price (expressed as a percentage)  as  set  forth in a Purchase Commitment
for such Agency Security.

                  "Company" has the meaning set forth in the first paragraph
of this Agreement.

                  "Construction Advance" means an Advance made against a
Construction/Perm Mortgage Loan.

                  "Construction/Perm  Mortgage Loan" means  a  First Mortgage
Loan in a principal amount not to exceed  $600,000, made  for  financing  the
purchase of real property and the  construction  of improvements on such real
property  by  the Parent, and which is converted to a Permanent Mortgage Loan
at the completion of the improvements.

<PAGE> 40

                  "Cost  Breakdown" means a list of the costs and expenses to
be financed by Advances  under  a Construction/Perm Mortgage Loan, including,
without   limitation,  real  property  acquisition  costs,  hard   and   soft
construction  costs,  architectural  fees and  any  other  costs and expenses
budgeted to construct  and complete the improvements.

                  "Credit Score" means a mortgagor's overall consumer  credit
rating, represented by a  single  numeric  credit  score calculated using the
Fair, Isaac consumer credit  scoring system, provided  by a credit repository
acceptable to the Lender and the Investor that issued the Purchase Commitment
covering the related Mortgage Loan.

                  "Debt"   means,  with respect to any Person at any date, (a)
all indebtedness or other obligations of such Person which, in accordance with
GAAP, would be included  in  determining   total  liabilities  as shown on the
liabilities side of a  balance sheet of  such Person at such date, and (b) all
indebtedness or other obligations of such Person for borrowed money or for the
deferred purchase price of property or services; provided that for purposes of
this  Agreement, there shall be excluded from Debt  at  any date  Subordinated
Debt not due within one year of such date  and  deferred  taxes  arising  from
capitalized  excess servicing fees and capitalized servicing rights.

                  "Default" means the occurrence  of any event or existence of
any condition which, but for the giving of Notice, the lapse of time, or both,
would constitute an Event of Default.

                  "Depository Benefit" shall mean the compensation received by
the  Lender, directly or indirectly,  as a result of the Company's maintenance
of Eligible Balances with a Designated Bank.

                  "Designated Bank" means any bank(s) designated  from time to
time  by  the Lender as a Designated  Bank, but only for as long as the Lender
has an agreement under which the Lender can receive a Depository Benefit.

                  "Designated Bank Charges" means any fees,  interest or other
charges that would  otherwise  be  payable  to a Designated Bank in connection
with Eligible Balances  maintained  at  a  Designated Bank, including  Federal
Deposit Insurance  Corporation  insurance  premiums, service  charges and such
other charges as may be imposed by governmental authorities from time to time.

                  "Effective Date" means October 8, 1999.

                  "Electronic   Advance   Request"   means   an   electronic
transmission through RFConnects Delivery  containing the same information as
Exhibit  C-SF  to  this Agreement,   together  with  the  RFConnects  Pledge
Agreement, duly  executed  by  the Company, and a list of the Mortgage Loans
(including  mortgagor's name, loan  number  and  loan  amount)  to be funded
with the  Advance  sent to the Lender by facsimile.

<PAGE> 41

                  "Eligible Balances" means all funds of or maintained by the
Company  and its Subsidiaries in accounts at a Designated Bank, less balances
to support float, reserve requirements,  and  such other reductions as may be
imposed by governmental authorities from time to time.

                  "Eligible Loan" means a Single Family Mortgage Loan secured
by a Mortgage on   real  property  located in one of the states of the United
States or the District of Columbia  that  is  designated as such on Exhibit M
attached hereto and made a part hereof.

                  "Eligible Mortgage Pool" means a Mortgage Pool for which (a)
an  Approved  Custodian  has issued its initial certification (on the basis of
which  an  Agency  Security  is to be  issued),  (b)  there exists a  Purchase
Commitment covering such Agency Security, and (c) such Agency Security will be
delivered to the Lender.

                  "ERISA" means the Employee Retirement Income Security Act of
1974  and  all  rules and regulations promulgated thereunder,  as amended from
time to time and any successor statute.

                  "Event of Default" means any of the conditions or events set
forth in Section 8.1 hereof.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute.

                  "Existing Credit Agreement" has the meaning set forth in the
first recital hereto.

                  "Extension  Fee"  means  a  fee payable by  the  Company  in
consideration  of the Lender's  extension of the Commitment,  pursuant to this
Agreement. The amount of the Extension Fee is set forth in Section 10 hereof.

                  "Fair Market Value"  means at any date with  respect  to any
Mortgage Loan covered by a valid Purchase Commitment,  the Committed  Purchase
Price, or in the absence of a valid Purchase Commitment for a Mortgage Loan or
the related Agency Security  (if such  Mortgage  Loan is to be used to back an
Agency  Security),   the  market  price  (expressed  as  a  percentage  of the
outstanding principal balance) for 30-day mandatory future  delivery  of  such
Mortgage Loan or Agency Security published  by  Bloomberg  L.P.  or, if not so
published,  the   average   bid   price  (expressed  as a percentage  of   the
outstanding  principal  balance) quoted  in  writing  to  the Lender as of the
computation  date by any 2  nationally  recognized  dealers  selected  by  the
Lender who at the time are making a market  in  similar  Mortgage   Loans   or
Securities, multiplied, in   the  case  of Mortgage Loans, by the  outstanding
principal balance   thereof   and,   in  the case of Agency Securities, by the
product  of  the  pool factor of such Agency Security times the face amount of
such Agency Security.
<PAGE> 42

                  "Fannie Mae" means Fannie Mae, a corporation created under
the laws of the United States, and any successor thereto.

                  "FHA" means the Federal Housing Administration and any
successor thereto.

                  "FICA" means the Federal Insurance Contributions Act.

                  "FIRREA" means the Financial Institutions Reform, Recovery
and   Enforcement  Act of 1989,  as  amended  from   time  to time,  and the
regulations promulgated and rulings issued thereunder.

                  "First Mortgage" means a Mortgage which constitutes a first
Lien on the property covered thereby.

                  "First Mortgage Loan" means a Mortgage Loan secured by a
First Mortgage.

                  "FmHA" means the Farmers Home Administration and any
successor thereto.

                  "FmHA Mortgage Loan" means a Mortgage Loan secured by a
First Mortgage and with respect to which ninety percent (90%) of the principal
amount of each Mortgage Loan is guaranteed by FmHA.

                  "Freddie Mac" means Freddie Mac, a corporation created under
the laws of the United States, and any successor thereto.

                  "Funding Bank" means The First National Bank of Chicago or
any other bank designated from time to time by the Lender.

                  "Funding  Bank  Agreement"   means the   letter   agreement
substantially in the form of Exhibit K hereto.

                  "GAAP" means generally accepted  accounting  principles  set
forth in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants  and statements and
pronouncements  of the  Financial  Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession, which are applicable to the circumstances as of the
date of determination.

                  "Gestation Agreement"  means an agreement  under  which  the
Company  agrees  to sell or finance (a) a Pledged  Mortgage  prior to the date
of purchase by an Investor, or (b) a Mortgage Pool prior to the date an Agency
Security backed by such Mortgage Pool is issued.

                  "Ginnie Mae"   means  the   Government   National   Mortgage
Association,  an agency of the United  States  government,  and any  successor
thereto.

<PAGE> 43

                  "Hedging   Arrangements" means, with respect to any Person,
any agreements or other arrangement (including, without limitation,  interest
rate swap agreements, interest   rate   cap   agreements   and   forward sale
agreements) entered into by such Person to protect itself against  changes in
interest rates or the market value of assets.

                  "HUD" means the Department of Housing and Urban Development
and any successor thereto.

                  "HUD 203(K) Mortgage Loan"  means an FHA insured closed-end
First Mortgage Loan secured by a First Mortgage, of which a portion  will  be
used for the purpose of rehabilitating and/or repairing the  related   single
family property, and which satisfies the definition  of "rehabilitation loan"
under 24 C.F.R. Section 203.50(a).

                  "Indemnified Liabilities" has the meaning set forth in
Article 10 hereof.

                  "Internal Revenue Code" means the Internal  Revenue Code of
1986,   or   any  subsequent  federal  income  tax law or laws, as any of the
foregoing have been or may from time to time be amended.

                  "Investor" means Fannie Mae,  Freddie Mac or a  financially
responsible private institution which is deemed acceptable by the Lender from
time to time in its sole  discretion  with respect to a  particular  category
of Pledged Mortgages.

                  "Lender" has the meaning set forth in the first paragraph of
this Agreement.

                  "LIBOR"  means, for each calendar week, the rate of interest
per annum which is  equal to the  arithmetic  mean of the U.S.  Dollar  London
Interbank Offered Rates for 1 month periods of certain U.S. banks as  of 11:00
a.m. London time on the first  Business  Day of each week on which the  London
Interbank market is open,  as published by Bloomberg  L.P. If such U.S. dollar
LIBOR rates are not so offered or published for any  period,  then during such
period LIBOR shall mean the London Interbank Offered Rate for 1 month  periods
published on the first Business Day of each week on which the London Interbank
market  is  open,  in the  Wall  Street Journal in its regular column entitled
"Money Rates."

                  "Lien"  means any lien,  mortgage,  deed of  trust,  pledge,
security   interest,   charge or   encumbrance   of   any  kind (including any
conditional sale or other title retention  agreement,  any lease in the nature
thereof,  and any agreement to give any security interest).

                  "Loan   Documents"   means   this  Agreement, the Note, any
agreement  of  the  Company  relating  to  Subordinated  Debt, and each other
document, instrument  or  agreement  executed  by the  Company in  connection
herewith  or  therewith, as any of the same may be amended, restated, renewed
or replaced from time to time.

<PAGE> 44

                  "Manufactured Home"  means a  structure  that is  built on a
permanent   chassis  (steel  frame)  with  the  wheel assembly  necessary  for
transportation  in one or more  sections to a permanent site or semi-permanent
site and which  has been  built in  compliance  with the National Manufactured
Housing Construction and Safety Standards established by HUD.

                  "Margin Stock"  has the meaning  assigned  to  that  term in
Regulation  U of the Board of  Governors of the Federal  Reserve  System as in
effect from time to time.

                  "Maturity Date"  shall mean the earlier of: (a) the close of
business  on  September  30, 2001,  as  such date may be extended from time to
time in writing by the Lender,  in its  sole  discretion,  on  which  date the
Commitment shall expire of its own term and without the  necessity  of  action
by the Lender, and (b) the date the Advances become due  and payable  pursuant
to Section 8.2
below.

                  "Miscellaneous Charges" has the meaning set forth in Section
2.10 hereof.

                  "Mortgage"   means  a  mortgage  or  deed  of trust on real
property and any improvements thereon (including,  without  limitation,  real
property to which a Manufactured  Home has been affixed in a manner such that
the Lien of a mortgage or deed of  trust  would  attach to such  manufactured
home  under applicable real property law).

                  "Mortgage-backed  Securities"  means  securities  that  are
secured or otherwise backed by Mortgage Loans.

                  "Mortgage Loan" means any loan evidenced by a Mortgage Note
and secured by a Mortgage.

                  "Mortgage Note" means a promissory note secured by a
Mortgage.

                  "Mortgage  Note  Amount"   means,  as   of   the   date   of
determination, the then outstanding unpaid  principal  amount  of  a  Mortgage
Note (or other note evidencing an Eligible Loan) (whether or not an additional
amount is available to be drawn thereunder).

                  "Mortgage   Pool"   means  a  pool  of  one  or more Pledged
Mortgages  on  the  basis  of  which  there  is to be issued a Mortgage-backed
Security.

                  "Multiemployer   Plan"   means  a   "multiemployer  plan" as
defined  in  Section 4001(a) (3) of ERISA which is maintained for employees of
the Company or a Subsidiary of the Company.

                  "Note(s)" has the meaning set forth in Section 2.3 hereof.

                  "Notices" has the meaning set forth in Article 9 hereof.

<PAGE> 45

                  "Obligations" means any and all indebtedness,  obligations
and  liabilities  of  the  Company  to  the  Lender (whether now existing or
hereafter arising,  voluntary or involuntary,  whether  or not jointly  owed
with  others,  direct  or indirect,  absolute or  contingent,  liquidated or
unliquidated, and whether or not from time to time decreased or extinguished
and later  increased, created or incurred), arising out of or related to the
Loan Documents.

                  "Officer's   Certificate"  means a certificate executed on
behalf of the Company by its chief financial  officer or its treasurer or by
such other officer as may be  designated  herein  and  substantially  in the
form of Exhibit I-SF attached hereto.

                  "Operating  Account"   means  a  demand   deposit  account
maintained at the Funding Bank in the name of the Company and designated for
funding that portion  of each  Eligible Loan not funded by an  Advance  made
against  such Eligible  Loan and for  returning  any excess  payment from an
Investor  for a Pledged Mortgage or Pledged Security.

                  "Parent" shall mean U.S. Home Corporation.

                  "Participant" has the meaning set forth in Section 12.5
hereof.

                  "Permanent  Mortgage Loan"  means  a  Construction/Permanent
Mortgage Loan after the construction or rehabilitation on the premises related
to such Mortgage Loan  has been  completed  and  such  Mortgage  Loan has been
converted to an amortizing Mortgage Loan by the modification or replacement of
the Mortgage Note.

                  "Person" means and includes natural  persons,  corporations,
limited liability companies, limited partnerships, general partnerships, joint
stock companies, joint ventures, associations, companies, trusts, banks, trust
companies, land trusts, business trusts or other organizations, whether or not
legal  entities,  and  governments  and  agencies  and  political subdivisions
thereof.

                  "Plans" has the meaning set forth in Section 5.12 hereof.

                  "Pledged Mortgages" has the meaning set forth in Section 3.1
(a) hereof.

                  "Pledged  Securities" has the  meaning set forth in Section
3.1 (b) hereof.

                  "Purchase Commitment" means a written commitment,  in form
and substance satisfactory to the Lender,  issued in favor of the Company by
an Investor pursuant to which that Investor commits to purchase Mortgage Loans
or Mortgage-backed Securities.

<PAGE> 46

                  "Release Amount" has the meaning set forth in Section 3.2(g)
hereof.

                  "RFC" means Residential Funding Corporation, a Delaware
corporation, and any successor thereto.

                  "RFConnects Delivery" means the Lender's proprietary service
to support the electronic exchange of  information  between the Lender and the
Company, including, but not limited to, Advance Requests,  shipping  requests,
payoff requests, activity reports and exception reports.

                  "RFConnects Pledge Agreement means a pledge agreement in the
form of Exhibit N to the Agreement.

                  "Second  Mortgage"  means  a  Mortgage  which  constitutes a
second Lien on the property covered thereby.

                  "Second Mortgage Loan" means a Mortgage Loan secured by a
Second Mortgage.

                  "Servicing Contract" means, with respect to any Person, the
arrangement, whether or not in writing, pursuant to which such Person has the
right to service Mortgage Loans.

                  "Servicing Portfolio" means, as to any  Person,  the unpaid
principal balance of Mortgage Loans serviced by such Person  under  Servicing
Contracts.

                  "Single Family Mortgage Loan" means a Mortgage Loan secured
by a Mortgage covering improved real property containing  one to four  family
residences.

                  "Statement Date" means the date of the most recent financial
statements of the Company  (and,  if  applicable,  its  Subsidiaries,   on  a
consolidated basis) delivered to the Lender under the terms of this Agreement.

                  "Sublimit" means the aggregate amount of Advances (expressed
as a  dollar  amount  or as a  percentage of the Commitment  Amount)  that  is
permitted  to  be  outstanding  at  any  one  time  against a specific type of
Eligible Loan.

                  "Subordinated  Debt" means  (a)  all  indebtedness  of  the
Company for borrowed money which  is  effectively  subordinated  in  right of
payment to all other present and  future  Obligations  either (i) pursuant to
a Subordination of Debt  Agreement in the form of  Exhibit  F hereto  or (ii)
otherwise  on terms acceptable to the  Lender, and (b) solely for purposes of
Section 7.4 hereof, all indebtedness of the Company  which is required  to be
subordinated  by Section 4.1(b) or Section 6.10 hereof.

<PAGE> 47

                  "Subsidiary"  means any corporation,  association  or  other
business entity in which more than 50% of the total voting  power or shares of
stock entitled to vote in the  election  of  directors,  managers  or trustees
thereof is at the time owned or controlled,  directly  or  indirectly,  by any
Person  or  one  or  more  of  the  other  Subsidiaries  of  that  Person or a
combination thereof.

                  "Tangible Net Worth" means with respect to any Person at any
date, the excess of the total assets of such Person over total liabilities of
such  Person  on such  date,  each to be  determined in accordance with  GAAP
consistent with those applied in the preparation of the most recently audited
financial statements delivered to the Lender pursuant to the Existing  Credit
Agreement, plus that portion of Subordinated  Debt  not  due within 1 year of
such date; provided that, for purposes of  calculating  Tangible  Net  Worth,
there shall be excluded from total assets advances  or loans to shareholders,
officers, employees or Affiliates, investments in  Affiliates, assets pledged
to secure any liabilities not included in the Debt of such Person, intangible
assets,  those other assets which would be deemed by HUD to be non-acceptable
in  calculating adjusted  net worth in  accordance with its  requirements  in
effect as of such date,  as such  requirements appear in the "Audit Guide for
Audit  of  Approved  Non-Supervised  Mortgagees,"  and  other  assets  deemed
unacceptable by the Lender in its sole discretion.

                  "Title I Mortgage Loan" means an FHA  co-insured  closed-end
First  Mortgage  Loan  or  Second  Mortgage  Loan  which  is  underwritten  in
accordance  with  HUD  underwriting  standards  for  the   Title  I   Property
Improvement Program as set forth  in and which is reported for insurance under
the Mortgage  Insurance  Program  authorized and administered under Title I of
the  National  Housing Act of 1934, as amended and the regulations promulgated
thereunder.

                  "Total Costs" means  the  total  of  the  costs and expenses
listed on the Cost Breakdown.

                  "Trust Receipt"  means a trust receipt in a form approved by
and pursuant to which the Lender may  deliver  any  document  relating  to the
Collateral to the Company for correction or completion.

                  "Unimproved Advance" means an Advance made against an
Unimproved Mortgage Loan.

                  "Unimproved Mortgage Loan" means a Mortgage Loan secured by
a First  Mortgage on unimproved  real  property  intended for  commercial  or
residential development  and used by the mortgagor to finance the acquisition
of such real property.

                  "Usage Fee" has the meaning set forth in Section 2.8(b)
hereof.

                  "Used Portion" has the meaning set forth in Section 2.8(b)
hereof.
<PAGE> 48

                  "VA" means the U.S. Department of Veterans Affairs and any
successor thereto.

                  "Warehousing Fee" has the meaning set forth in Section 2.9
hereof.

                  "Warehouse Period" means, for any Eligible Loan, the maximum
number of days an Advance against that type of Eligible  Loan is  permitted to
remain outstanding as set forth on Exhibit M attached to this Agreement.

                  "Warehousing  Promissory  Note" means  the  promissory  note
evidencing  the Company's Obligations  with  respect to Advances  made against
Eligible Loans, in the form of Exhibit A-1 attached hereto.

                  "Weighted Average Purchase Commitment  Price" shall mean the
weighted  average of the Committed Purchase  Prices of the  unfilled  Purchase
Commitments (expressed as a percentage) for Mortgage Loans or  Mortgage-backed
Securities of the same type, interest rate and term.

                  "Wet Settlement Advance"  means with respect to any Advance,
the time from the date the  Advance  is made  until  the date of the  Lender's
receipt of the Collateral  Documents as  provided  in  Section  2.2(b) and the
Exhibit referenced therein.

                  "Wire Disbursement Account" means a demand  deposit  account
maintained  at the Funding Bank in the name of the Lender for the  clearing of
wire transfers requested by the Company to fund Advances.

                  "Year  2000   Problem"    means  the  risk  that  computer
applications may not be able  to properly  perform  date-sensitive  functions
after December 31, 1999.

                  1.2      Other Definitional Provisions.

                           1.2(a) Accounting terms not otherwise defined herein
shall have the meanings given the terms under GAAP.

                           1.2(b) Defined  terms may be used in the singular or
the plural, as the context requires.

                           1.2(c)   All references to time of day shall mean
the then applicable time in Chicago, Illinois, unless expressly provided to the
contrary.

<PAGE> 49

2.       THE CREDIT.

                  2.1  The Commitment.

                           2.1(a)  Subject to the terms and conditions of this
Agreement and provided  no  Default or Event of Default  has  occurred  and is
continuing, the Lender agrees  from time to time  during  the period  from the
Closing Date to, but not including, the Maturity Date, to make Advances to the
Company, provided the total aggregate principal amount  outstanding at any one
time  of  all  such  Advances  shall  not  exceed  the  Commitment Amount. The
obligation of the Lender to make Advances hereunder up to the Commitment Amount
is  hereinafter  referred to as the  "Commitment." Within the Commitment,  the
Company  may  borrow,  repay  and  reborrow.  Effective as of the date of this
Agreement,  all  outstanding  loans  made  pursuant  to  the  Existing  Credit
Agreement shall for all purposes  be deemed to be  Advances  made  under  this
Agreement.  All  previous  Advances  and new  Advances  under  this  Agreement
shall  constitute  a single indebtedness,  and all of the Collateral  shall be
security for the Note and for the performance of all the Obligations.

                           2.1(b   Advances shall be used by the Company solely
for the purpose of funding the acquisition or origination of Eligible Loans and
shall be made at the request of the Company, in the manner hereinafter provided
in Section 2.2 hereof, against the pledge of such Eligible Loans as Collateral
therefor. The limitations on the use  of  Advances  set  forth  on  Exhibit  M
attached hereto  and  made  a part  hereof shall be  applicable.  In addition,
the following limitations on the use of Advances shall be applicable:

                   (1) No Advance, other than a Construction/Permanent Advance
or an Unimproved  Advance,  shall be made against any Mortgage Loan  which
was  closed  more than 90 days  prior to the date of the  requested Advance.

                   (2) No Advance shall be made against a Mortgage Loan other
than a Mortgage Loan secured by a Mortgage on real property located in one of
the states of the United States or the District of Columbia.

                   (3) No Advance shall be made against an Unimproved Mortgage
Loan unless all payments  which   were  due  and  payable  under  the  related
Unimproved  Mortgage  Loan  on  or prior to the date of such Advance have been
made.

                   (4) No Advance shall be made against an Unimproved Mortgage
Loan secured by property  intended for commercial development, if the Mortgage
Note  Amount  exceeds  80%  of  the  fair  market  value  of  such property as
determined by the Lender in its reasonable judgement.

<PAGE> 50

                           2.1(c) No Advance shall exceed the following amount
applicable to the type of Eligible Loan at the time it is pledged to secure an
Advance hereunder:

                   (1) For an Eligible Loan pledged hereunder,
the amount set forth on Exhibit M attached hereto and made a part hereof.

                  2.2      Procedures for Obtaining Advances.

                           2.2(a) To  obtain  an  Advance,  the  Company  must
comply with the conditions set forth in Sections 4.1 and 4.2 of this Agreement,
the  procedures  set  forth  in this  Section  2.2(a),  and the procedures and
documentation  required   under  the  Exhibit  D for the type of Mortgage Loan
against which the Company is requesting the  Advance. The Company will request
an Advance either by delivering to  Lender  a  completed  and  signed  advance
request in the applicable  form of  Exhibit C or,  if applicable,  by  sending
to  Lender  an  Electronic  Advance  Request, together with a list of Mortgage
Loans  for  which  the  request  is  being  made  and  a completed  and signed
RFConnects  Pledge  Agreement sent by facsimile  (each  an "Advance Request"),
each no later than 1 Business Day prior to  the  Business  Day  the  requested
Advance is to be made. The  current forms of  each  Exhibit  C and  Exhibit  D
referred  to  above  are  attached  to this Agreement. The Lender is entitled,
upon not less than 3 Business  Days'  prior  Notice  to the Company, to modify
any  of  those  Exhibits or the form of Electronic Advance  Request to conform
to  current legal  requirements  or Lender's  lending practices.  Exhibits and
Electronic  Advance  Requests so modified  automatically become a part of this
Agreement.

                           2.2(b) In the case of a Wet Settlement Advance, the
Company shall follow the procedures and, at or prior to the Lender's making of
such  Wet  Settlement  Advance,  shall deliver to the Lender the documents set
forth  in  the  applicable  Exhibit D hereto.  In the case of a Mortgage  Loan
financed through a  Wet  Settlement  Advance,  the  Company  shall  cause  all
Collateral Documents required to be  delivered  to the Lender  pursuant to the
applicable  Exhibit  D  within  7  Business  Days  after  the  date of the Wet
Settlement  Advance relating thereto.

                           2.2(c) Before  funding, the  Lender  shall  have a
reasonable time (1 Business Day under ordinary circumstances) to examine such
Advance  Request and the Collateral Documents to be  delivered  prior to such
requested Advance, as set forth in  the  applicable  Exhibit  hereto, and may
reject such of them as do not meet the requirements  of  this Agreement or of
the related Purchase  Commitment.  The  Lender shall have  no  obligation  to
make  a Wet Settlement  Advance  directly  to the Parent  against a  Mortgage
Loan  unless  the  Lender has received  satisfactory  evidence from the title
company  closing  the  Mortgage  Loan  that  such Mortgage Loan is closed and
funded.

<PAGE> 51

                           2.2(d) The Company shall hold in  trust  for the
Lender, and the Company shall deliver to the Lender promptly upon request, or
if the recorded Collateral Documents  have  not  yet been returned from the
recording office, immediately upon receipt by the Company of such  recorded
Collateral Documents,  and the Pledged  Mortgage  is not  being  held by an
Investor  for purchase or has not been redeemed from pledge, the following:
(1) the originals of the Collateral Documents for which copies are required to
be delivered to the Lender  pursuant to  the  applicable  Exhibit D, (2) the
original  lender's  ALTA Policy of Title Insurance or an equivalent thereto,
and (3) any other documents relating to a  Pledged Mortgage which the Lender
may request, including,  without limitation,  documentation  evidencing  the
FHA Commitment to Insure or the FmHA Guaranty or VA Guaranty of any  Pledged
Mortgage which is either FHA insured, FmHA guaranteed or VA guaranteed,  the
appraisal,  Private  Mortgage  Insurance  Certificate, if   applicable,  the
Regulation Z Statement, certificates of casualty or hazard insurance, credit
information on the maker of each such Mortgage Note, a  copy  of  a HUD-1 or
corresponding  purchase  advice and other documents  of  all kinds which are
customarily desired for inspection or transfer incidental to the purchase of
any  Mortgage  Note  by  an  Investor  and  any  additional  documents which
are customarily executed by the seller of a Mortgage Note to an Investor.

                           2.2(e) To make  an  Advance, the Lender shall cause
the Funding Bank to credit either the Wire  Disbursement  Account or the Check
Disbursement Account upon compliance by the Company with the terms of the Loan
Documents. The  Lender  shall  determine  in its sole discretion the method by
which Advances and other amounts on deposit in the Wire  Disbursement  Account
are disbursed by the Funding Bank to or for the account of the Company.

                           2.2(f) If,  pursuant  to the authorization given by
the  Company  in  the  Funding  Bank  Agreement, for  the purpose of funding a
Mortgage Loan against which the Lender has made an Advance in  accordance with
a Request for Advance (i) the Lender debits the Company's Operating Account at
the Funding Bank to the extent  necessary to cover a  wire  to be initiated by
the Lender,  or (ii) the Lender  directs the Funding  Bank  to  honor  a check
drawn by the Company on its Check Disbursement Account at  the  Funding  Bank,
and such debit or direction results in an overdraft,  the  Lender  may make an
additional Advance to fund such overdraft.

                  2.3 Note. The Company's Obligations shall be evidenced by the
promissory note (the "Note") dated as of the date hereof  substantially in the
form of Exhibit  A  attached hereto.  The  term   "Note"   shall  include  all
extensions,  renewals  and  modifications  of  the  Note and all substitutions
therefor. All terms and provisions of the Note are hereby incorporated herein.

<PAGE> 52

                  2.4 Interest.

                           2.4(a) Except as otherwise provided in  Section 2.4
(e) hereof, the unpaid  amount of each Advance against an Eligible  Loan shall
bear  interest, from  the  date the Advance until paid in full, at the rate(s)
per annum set forth on Exhibit M attached hereto and made a part hereof.

                           2.4(b) The Company is entitled to receive a benefit
in the form of an "Earnings Credit" on the  portion of the  Eligible  Balances
maintained in time deposit accounts with a Designated Bank, and the Company is
entitled to receive a benefit in the  form of an "Earnings  Allowance"  on the
portion of the Eligible Balances maintained in demand deposit  accounts with a
Designated  Bank.  Any Earnings Allowance shall be used first and any Earnings
Credit shall be used second  as  a  credit  against  accrued  Designated  Bank
Charges, any other Miscellaneous Charges and fees, including, but not  limited
to Commitment  Fees,  Usage  Fees and  Warehousing  Fees,  and  may  be  used,
at the Lender's option,  to reduce accrued  interest.  Any Earnings  Allowance
not  used  during  the  month  in  which  the  benefit  was  received shall be
accumulated for use and must be used within 6 months of the month in which the
benefit was received.  Any Earnings  Credit not used during the month in which
the benefit was received shall  be  used to provide  a  cash  benefit  to  the
Company.  The  Lender's determination  of the Earnings Credit and the Earnings
Allowance  for  any  month shall be determined  by  the  Lender  in  its  sole
discretion and shall be conclusive and  binding  absent  manifest error. In no
event shall the benefit received by the Company exceed the Depository Benefit.

                           Either party  hereto  may  terminate  the  benefits
provided  for in this  Section  effective immediately upon Notice to the other
party, if the  terminating  party  shall have determined (which  determination
shall be conclusive and binding absent manifest error) at any  time  that  any
applicable law, rule,  regulation,  order  or  decree or any interpretation or
administration  thereof  by  any  governmental  authority  charged  with   the
interpretation  or   administration  thereof,  or  compliance  by  such  party
with any request or  directive (whether or not having the force of law) of any
such  authority,  shall  make  it  unlawful or  impossible  for  such party to
continue to offer or receive the benefits provided for in this Section.

                           2.4(c) Interest shall be computed on the basis of a
360-day year and applied to the actual number of days elapsed in each interest
calculation  period  and shall be payable monthly in arrears, on the first day
of  each month, commencing with the first month following the Closing Date and
on the Maturity Date.

                           2.4(d) If, for any reason, no interest  is  due on
an Advance, the Company agrees to pay to  the  Lender  an  administrative fee
equal  to  one  day  of  interest  on  such  Advance  at the rate of interest
applicable  to  such  Advance,  as  in  effect  on  the date of such Advance.
Administrative and other fees shall be due and  payable in the same manner as
interest is due and payable hereunder.

<PAGE> 53

                           2.4(e) Upon  Notice  to  the  Company, after   the
occurrence  and  during  the  continuation of an Event of Default, the unpaid
amount of each Advance  shall bear interest until paid in full at a per annum
rate of interest (the  "Default  Rate")  equal to 4% in excess of the rate of
interest  otherwise  applicable to the Advance or, if no rate is  applicable,
the highest rate then applicable to any outstanding Advances.

                           2.4(f) The  floating rates of interest provided for
in this Agreement will be adjusted as of the effective  date of each change in
the  applicable index. The Lender's determination of such rates as of any date
of determination shall be conclusive and binding, absent manifest error.

                  2.5      Principal Payments.

                           2.5(a) The outstanding principal amount of all
Advances shall be payable in full on the Maturity Date.

                           2.5(b) The Company shall have the right to prepay
the  outstanding  Advances  in  whole or in part, from time to time, without
premium or penalty.

                           2.5(c) The  Company  shall pay the Lender,  without
the necessity of prior  demand  or notice  from the  Lender,  and the  Company
authorizes the Lender  to cause  the  Funding  Bank to  charge  the  Company's
Operating  Account for, the  amount  of  any  outstanding  Advance  against  a
specific  Pledged  Mortgage,  upon  the  earliest  occurrence  of  any  of the
following events:

                                    (1) One (1) Business Day elapses from
the date an Advance was made and the Pledged  Mortgage  which was to have been
funded by such Advance is not closed and funded.

                                    (2) Ten  (10) Business  Days  elapse from
the date a Collateral Document was delivered to the Company for  correction or
completion  under a Trust Receipt,  if such  Collateral Document  has not been
returned to the Lender.

                                    (3) On  the  date  on  which   a   Pledged
Mortgage is determined to have been originated based on untrue,  incomplete or
inaccurate  information,  whether or not the  Company  had  knowledge  of such
misrepresentation or incorrect information or on the date on which the Company
knows, or has reason to know, or receives notice from the Lender,  that one or
more of the representations and  warranties  set  forth in  Section  5.15 were
inaccurate or incomplete in any material respect on any date when made or
deemed made.

                                    (4)  On  the  date the Pledged Mortgage is
defaulted and remains in default for a period of 60 days or more.

                                    (5)  If  the outstanding  Advances against
Pledged  Mortgages of a specific Mortgage Loan type,  other than an Unimproved
Mortgage  Loan,  exceed  the  aggregate Purchase Commitments for such Mortgage
Loan type.
<PAGE> 54

                                    (6)  For  a  Mortgage  Loan  covered  by a
Purchase Commitment at the time pledged  hereunder,  3 Business Days after the
mandatory delivery date of the related  Purchase  Commitment  and the specific
Pledged Mortgage or the Pledged Security  backed  thereby  was  not  delivered
under the Purchase Commitment prior to such  mandatory  delivery date, or  the
Purchase Commitment is terminated;  unless in each case, such Pledged Mortgage
or Pledged Security is eligible for delivery to an Investor under a comparable
Purchase Commitment acceptable to the Lender.

                                    (7)  Upon  sale  or other  disposition of
the Pledged Mortgage  or, if a Pledged  Mortgage  is  included in an Eligible
Mortgage Pool, upon sale or other disposition of the related Agency Security.

                                    (8)  For  a   Construction/Perm  Mortgage
Loan, a lien is filed against the premises and  not removed within 15 days of
the filing, or an inspection report indicates  that  the  improvements to the
premises  encumbered  by  the  Pledged Mortgage are not being  constructed in
accordance with the approved plans and specifications.

                           2.5(d) Upon Notice to the Company by the Lender,
the Company shall pay to the Lender, and the Company authorizes the Lender to
cause the Funding Bank to charge the Company's Operating Account for, the
amount of any outstanding Advance against a specific Pledged Mortgage upon
the earliest occurrence of any of the following events:

                                    (1)  For any Pledged Mortgage, the
Warehouse Period elapses.

                                    (2)  On the date the  payment of a Lien
prior to a Pledged  Mortgage is delinquent  for a period of  60 days.

                                    (3)  Forty-five (45) days elapse from the
date  the  Pledged  Mortgage  was delivered  to  an  Investor  or an Approved
Custodian for examination  and  purchase  or  inclusion  in  a Mortgage Pool,
without the purchase  being made or an Eligible Mortgage Pool being initially
certified,  or upon rejection of the Pledged  Mortgage as  unsatisfactory  by
an Investor or an Approved Custodian.

                                    (4)  Seven (7) Business  Days elapse from
the date a Wet Settlement Advance was made without receipt by  the  Lender of
all  Collateral  Documents  relating  to  such  Pledged  Mortgage,   or  such
Collateral Documents,  upon  examination  by the Lender,  are found not to be
in compliance with the requirements of this Agreement or the related Purchase
Commitment.

                                    (5)   With   respect   to   any   Pledged
Mortgage,  any of the items described  in Section 2.2(d), upon examination by
the Lender,  are  found not to be in  compliance  with  the  requirements  of
this Agreement or the related Purchase Commitment.

                           2.5(e) The outstanding amount of any Advance made
pursuant  to  Section  2.2(f) shall be payable in full within 1 Business Day
after the date of such Advance.
<PAGE> 55

                           2.5(f) In  addition   to  the  payments  required
pursuant to Sections 2.5(d) and 2.5(e), if the principal amount of any Pledged
Mortgage is prepaid in whole or in  part  while  an  Advance  is outstanding
against such  Pledged  Mortgage,  the Company  shall be  obligated to pay to
the Lender, without the necessity of prior demand or notice from the Lender,
and the Company authorizes the Lender to cause  the  Funding  Bank to charge
the  Company's Operating Account for the  amount of such  prepayment,  to be
applied to such Advance.

                           2.5(g) The   proceeds  of   the   sale  or  other
disposition of Pledged Mortgages and Pledged Securities shall be paid directly
by the Investor to the Cash Collateral Account. The Company shall give Notice
to the Lender (telephonically, to be followed by written  notice) of the
Pledged Mortgages or Pledged Securities for which proceeds have been received.
Upon receipt of such Notice the Advances against such Pledged  Mortgages or
Pledged Securities shall be repaid from such  proceeds  and such  Pledged
Mortgages or Pledged  Securities  shall be considered to have been redeemed
from pledge.  The Lender is entitled to rely upon the Company's  affirmation
that deposits in the Cash  Collateral  Account  represent  payment from
Investors for the purchase of Pledged  Mortgages or Pledged  Securities  as
specified by the Company.  In the event that the payment from an Investor for
the purchase of Pledged Mortgages or Pledged  Securities is less than the
outstanding  Advances  against such Pledged Mortgages  or the  Mortgage  Loans
backing  Pledged  Securities,  the Lender is authorized to cause the Funding
Bank to charge the Company's  Operating  Account for an amount equal to such
deficiency.  Provided no Default or Event of Default exists,  the Lender shall
return any excess payment from an Investor for Pledged Mortgages or Pledged
Securities to the Company.

                           2.5(h) The Company may, from time to time, prepay a
portion of  the  Advances pursuant to this Section 2.5(h) (any such prepayment
is hereafter  referred to as a "Buydown").  A Buydown shall not, except as set
forth below, be deemed a prepayment of any particular Advances,  and shall not
entitle the Company to the release of any Collateral. If a Default or an Event
of  Default  has occurred  and is continuing,  the Lender shall be entitled to
retain  as  additional  Collateral  any  portion of the Buydown which has been
funded by the Company.  Any portion of the  Buydown  which  has been funded to
the  Company  by its Parent  and/or  Affiliates  shall be  refunded  to and at
the  direction  of  the  Company.   All  or  any  portion  of a Buydown may be
reborrowed  hereunder,  provided no Default or Event of  Default has  occurred
and is  continuing,  upon  written notice to the  Lender  no later  than  9:30
a.m.  on the  Business  Day that the Company  desires to reborrow such amount.
The   Lender   shall  use its best efforts to apply each Buydown to reduce the
interest on Advances  in  the  following order:   first,  Unimproved Advances;
second,  Construction  Advances;  third,  Subprime Advances; and fourth, Prime
Advances (as defined on Exhibit M hereto); provided, however,  that no portion
of  any  Buydown  may  be  or  remain  applied to Unimproved Advances  unless,
after  giving  effect to   such   application,   the   outstanding   principal
balance of the Unimproved  Advances (net of the portion of the Buydown applied
thereto) would be greater  than  or  equal  to  $2,500,000.  In  the event the
Lender receives a payment of Advances that would,  as a result of the Buydown,
reduce the outstanding principal balance  of  the Unimproved  Advances  to  an
amount less than $2,500,000, or the outstanding principal balance of the other
Advances to an amount less than zero,  unless  an  Event of Default shall have
occurred and be continuing, the Buydowns, or a portion  thereof  equal to such
excess, shall be re-advanced to the Company.
<PAGE> 56

                  2.6  Expiration of Commitment.  The Commitment shall expire
on the Maturity Date.

                  2.7  Method of Making Payments.

                           2.7(a) Except as otherwise  specifically  provided
herein, all payments hereunder shall be made to the Lender not later  than the
close of  business  on the date when due unless  such date is a  non-Business
Day, in which case,  such  payment  shall be due on the first Business Day
thereafter,  and shall be made in lawful money of the United States  of
America  in  immediately  available  funds  transferred  via wire to accounts
designated by the Lender from time to time.

                           2.7(b) After   the   occurrence   and   during  the
continuance of  an Event of Default, and without the necessity of prior demand
or notice  from  the  Lender,  the Company  authorizes the Lender to cause the
Funding Bank  to charge  the  Company's  Operating Account for any Obligations
due and owing the Lender.

                  2.8  Commitment Fees and Usage Fees.

                           2.8(a) The Company  agrees to  pay to the Lender a
Commitment   Fee  in  the  amount  of  1/10%  per annum of $15,000,000, which
Commitment Fee shall be paid quarterly in advance and shall be computed on the
basis of a 365-day year and applied to  the  actual number of days elapsed in
each Calendar Quarter. On the Closing Date, the Company shall pay the prorated
portion of the quarterly  Commitment Fee due  from  the  Closing  Date to the
last day of the current Calendar Quarter.  Thereafter, the Company shall make
quarterly payments of the  Commitment Fee on thefirst  day of  each  Calendar
Quarter.  If  the  scheduled  Maturity  Date  is other than the last day of a
Calendar Quarter, the Company shall pay the prorated portion of the quarterly
Commitment Fee due from the beginning of the then current Calendar Quarter to
and including the  Maturity  Date. For the purposes hereof, Calendar Quarters
shall be defined  as  the 3 month periods  beginning on each April 1, July 1,
October 1 and  January 1. The Company shall not be entitled to a reduction in
the  amount  of  the  Commitment Fee, in the event the  Commitment  Amount is
reduced or in the event that the  Commitment is terminated  at the request of
the Company or as a result of an Event of Default.
If the Commitment  terminates at the request of the Company or as a result of an
Event of Default, the unpaid balance of the Commitment Fee through the scheduled
Maturity Date shall be due and payable in full on the date of such termination.

                           2.8(b)  At the end of each Calendar Quarter  during
the term hereof, the Lender shall determine the average usage of the portion
of the Commitment during such Calendar Quarter in  excess of  $15,000,000  by
calculating the arithmetic  daily  average of the  Advances  (net of  Buydown)
outstanding during such Calendar Quarter.  To the extent the quarterly average
usage (the  "Used  Portion") exceeds  $15,000,000,  the  Company  shall pay in
arrears, within 30 days after  the end of each  calendar  quarter,  a fee (the
"Usage Fee"),  equal to 1/10% per annum on the total  amount by which the Used
Portion of the Commitment exceeded $15,000,000 during such Calendar Quarter.
<PAGE> 57

If the scheduled Maturity Date is other than the first day of a Calendar
Quarter, the Company shall pay the prorated portion of the Usage Fee due from
the beginning of the then current  Calendar  Quarter to and  including the
scheduled Maturity Date. In the absence of manifest  error,  the calculation
by the Lender of the amount of any Usage Fee shall be conclusive.

                  2.9  Warehousing Fees. The  Company  agrees, at the time of
each Advance, to  pay  to  the  Lender a Warehousing Fee in the amount of (i)
$10.00 for  each  Mortgage  Loan,  other than  an  Unimproved Mortgage  Loan,
pledged as Collateral for such Advance,  and (ii) $100.00 for each Unimproved
Mortgage  Loan  pledged as Collateral for such Advance.  Notwithstanding  the
foregoing, if the arithmetic  daily  average of the Advances (net of Buydown)
outstanding  in any month exceeds  $15,000,000,  no  Warehousing Fee shall be
payable for such month.  Warehousing  Fees are due when  incurred,  but shall
not be  delinquent  if paid within  fifteen  (15) days after  receipt  of an
invoice or an account  analysis statement from the Lender.

                  2.10  Miscellaneous Charges. The Company agrees to reimburse
the   Lender   for   miscellaneous   charges   and  expenses   (collectively,
"Miscellaneous Charges") incurred by or on behalf of the Lender  in connection
with the handling and administration of Advances,  and to reimburse the Lender
for Miscellaneous Charges incurred by or on behalf of the Lender in connection
with the handling and administration  of  the Collateral.  For  the   purposes
hereof,    Miscellaneous Charges  shall  include,   but not   be  limited  to,
costs for UCC,  tax lien and  judgment  searches  conducted  by   the  Lender,
filing  fees,  charges  for  wire transfers, check processing charges, charges
for security delivery fees,  charges  for overnight  delivery of Collateral to
Investors,  the   Funding  Bank's  service fees   and  overdraft  charges  and
Designated Bank Charges.  Miscellaneous  Charges  are  due when incurred,  but
shall not be delinquent if paid within 15 days after  receipt of an invoice or
an account analysis statement from the Lender.

                  2.11 Interest Limitation. All agreements between the Company
and the Lender are hereby expressly limited so that in no contingency or event
whatsoever, whether by reason of acceleration of maturity of this Agreement or
the Note or otherwise, shall the amount paid or agreed to be paid to the Lender
for the use, forbearance, loaning or retention of the Advances secured by this
Agreement exceed the maximum  permissible  under  applicable  law. If from any
circumstances whatsoever, fulfillment of any provisions hereof or of the Note,
or any other document securing this  Agreement at any time given shall involve
transcending the limit of  validity prescribed by law, then, the obligation to
be fulfilled shall automatically be reduced to the limit of such validity, and
if from any circumstances the Lende  should ever receive as interest an amount
which  would  exceed  the  highest lawful rate of interest,  such amount which
would be in excess of interest  shall  be  applied  to  the  reduction  of the
principal  balance  secured  by  the  Note  and not to the payment of interest
thereunder.   This  provision  shall control  every  other  provision  of  all
agreements  between  the  Company  and  Lender  and  shall  also  b e  binding
upon  and  available  to any subsequent holder of the Note.
<PAGE> 58

                  2.12 Increased Costs; Capital Requirements. In the event any
applicable law, order, regulation or directive  issued by any  governmental or
monetary  uthority, or any change therein or in the  governmental  or judicial
interpretation or application  thereof,  or  compliance by the Lender with any
request or directive  (whether  or  not  having  the  force  of  law)  by  any
governmental or monetary authority:

                           2.12(a)  Does  or  shall  subject the Lender to any
tax of any kind whatsoever with respect to this Agreement or any Advances made
hereunder,  or  change  the  basis of  taxation on payments  to the  Lender of
principal, fees, interest or any other amount  payable  hereunder  (except for
change in the rate of tax on the overall gross or net  income of the Lender by
the jurisdiction in which the Lender's principal office is located);

                           2.12(b)  Does or shall  impose,   modify  or  hold
applicable any reserve, capital requirement, special deposit, compulsory loan
or  similar  requirement  against  assets  held  by,  or  deposits  or  other
liabilities in or for the account of, advances or loans by, or  other  credit
extended by, or any other  acquisition of funds by, any office  of the Lender
which are not otherwise included in the determination of the interest rate as
calculated hereunder;  and the result of any of the foregoing  is to increase
the cost to the Lender of making, renewing or  maintaining  any Advance or to
reduce any amount receivable in respect  thereof  or  to  reduce  the rate of
return on the capital of the  Lender or any  Person  controlling  the  Lender
as it  relates  to credit facilities in the nature  of that evidenced by this
Agreement,  then, in  any  such case,  the Company  shall  promptly  pay  any
additional  amounts   necessary  to compensate the Lender for such additional
cost or reduced amounts receivable or reduced rate of  return  as  determined
by the  Lender  with  respect  to this Agreement or Advances made  hereunder.
If the Lender becomes  entitled to claim any  additional  amounts pursuant to
this Section,  it shall notify the Company of the event by reason of which it
has become so entitled and the Company shall pay such amount  within  15 days
thereafter. A certificate as to any additional amount payable pursuant to the
foregoing sentence containing the calculation thereof  in  reasonable  detail
submitted by the Lender to the Company shall be  conclusive in the absence of
manifest error. The  obligations  of  the  Company  under  this Section shall
survive the payment of all other  Obligations  and  the  termination  of this
Agreement.

3.       COLLATERAL.

                  3.1 Grant of Security Interest. As security for the payment
of the Note and for the performance of all of the Company's Obligations,  the
Company hereby assigns  and  transfers  to  the  Lender  all right, title and
interest in and to and grants  a  security  interest  to  the  Lender  in the
following described property (the "Collateral"):

<PAGE> 59

                           3.1(a)  All Mortgage Loans, including all Mortgage
Notes  and  Mortgages  evidencing or securing such Mortgage Loans, which from
time  to  time  are  delivered  or  caused  to  be  delivered  to the  Lender
(including delivery to a third party on behalf of the  Lender), come into the
possession, custody or control of the Lender for the purpose of assignment or
pledge or in respect of which an Advance  has  been  made   by   the   Lender
hereunder,   including  without  limitation all Mortgage Loans in  respect of
which  Wet Settlement Advances  have  been  made  by the Lender (the "Pledged
Mortgages").

                           3.1(b)  All Mortgage-backed Securities which are
from  time to time created in whole or in part on the  basis  of the  Pledged
Mortgages or are delivered or caused to be delivered to, or are otherwise in
the possession of the Lender or its agent,  bailee or custodian as assignee,
or pledged to the Lender,  or for such purpose are  registered by book-entry
in the name of the Lender (including delivery to or registration in the name
of a third party on behalf of the  Lender) hereunder or in  respect of which
from time to time  an  Advance  has  been  made  by  the  Lender   hereunder
(the  "Pledged Securities").

                           3.1(c)  All private  mortgage  insurance  and  all
commitments issued by the FHA, FmHA or VA to insure or guarantee any Mortgage
Loans included in the Pledged Mortgages; all Purchase Commitments held by the
Company covering  the  Pledged  Mortgages  or the Pledged Securities  and all
proceeds resulting from the sale thereof to  Investors pursuant thereto;  and
all personal property, contract rights,  servicing  and  servicing  fees  and
income or other proceeds,  amounts and payments  payable to  the  Company  as
compensation  or   reimbursement,  accounts,  payments, intangibles and other
general intangibles of whatsoever kind relating to the Pledged Mortgages, the
Pledged Securities, said FHA commitments, FmHA  commitments or VA commitments
and  the  Purchase   Commitments,  and  all other  documents  or  instruments
relating to the Pledged Mortgages  and  the  Pledged  Securities,  including,
without  limitation,  any  interest  of the Company in any fire,  casualty or
hazard insurance  policies and  any   awards  made  by  any  public  body  or
decreed  by  any  court  of  competent jurisdiction  for  a  taking  or   for
degradation  of value in any eminent  domain proceeding as the same relate to
the Pledged Mortgages.

                           3.1(d)  All   right,   title  and  interest  of the
Company in and to all escrow accounts, documents, instruments, files, surveys,
certificates, correspondence, appraisals,  computer  programs,  tapes,  discs,
cards,  accounting records (including all information,  records,  tapes, data,
programs,  discs and cards  necessary  or  helpful  in the  administration  or
servicing of the Collateral)  and other  information  and data of the  Company
relating to the Collateral.

                           3.1(e)  All   right,   title   and interest of the
Company in and to any Hedging Arrangements entered into to protect the Company
against  changes in the value of Pledged  Mortgages  or  Pledged  Securities,
including, without limitation, all rights  to  payment   arising  under  such
Hedging Arrangements.
<PAGE> 60

                           3.1(f)  All now existing or hereafter acquired cash
delivered to or otherwise  in  the possession of the Lender, the Funding Bank,
or the  Lender's  agent,  bailee  or  custodian or designated on the books and
records of the Company as assigned and pledged to the Lender.

                           3.1(g)  All  cash  and  non-cash   proceeds of  the
Collateral,   including  all  dividends,   distributions  and  other rights in
connection with, and all additions to,  modifications of and replacements for,
the Collateral, and all products and proceeds of the Collateral, together with
whatever is receivable or received when the Collateral or proceeds thereof are
sold,  collected, exchanged or otherwise disposed of, whether such disposition
is voluntary or involuntary,  including,  without limitation, all   rights  to
payment with  respect  to  any  cause  of  action affecting or relating to the
Collateral or proceeds thereof.

                           3.1(h)  All right,  title  and   interest  of  the
Company in and to  all  building  loan  agreements,  construction  contracts,
plans  and  specifications,  building permits,  governmental  approvals   and
licenses,  lender's  policies  of  title   insurance,  "all  risk"  builder's
insurance or workers' compensation insurance as the same relate to the Pledged
Mortgages.

                  3.2      Release of Security Interest in Collateral.

                           3.2(a) Pledged Mortgages shall be released from the
Lender's security interest  only against  payment to the Lender of the Release
Amount in connection with such Pledged Mortgages.

                           3.2(b) If Pledged Mortgages are to be transferred
to a pool custodian or to Freddie Mac  or  Fannie Mae  for  inclusion  in  a
Mortgage Pool, the Lender's security interest in such Pledged Mortgages shall
be released only against payment to the Lender  of  the  Release  Amount  in
connection with such Pledged  Mortgages.  If the Lender's  security interest
in the Pledged Mortgages comprising the Mortgage Pool is not released  prior
to the  issuance  of the Mortgage-backed  Security, then the Mortgage-backed
Security, when issued, shall be a Pledged  Security.  The Lender's  security
interest shall continue in such Pledged Mortgages and the Pledged  Security.
The Lender  shall b e entitled to possession of such Pledged Security in the
manner provided below.

                           3.2(c) If Pledged  Mortgages are  transferred to an
Approved Custodian and  included in an Eligible  Mortgage  Pool,  the Lender's
security interest in the Pledged Mortgages  comprising  the  Eligible Mortgage
Pool shall be released upon the issuance of  the Agency Security,  which shall
be a Pledged Security. The Lender's security interest in such Pledged Security
shall be released only against payment to the Lender of the Release  Amount in
connection  with  the  Pledged  Mortgages  backing such Pledged Security.  The
Lender shall be entitled to possession of such Pledged  Security in the manner
provided below.
<PAGE> 61

                           3.2(d) The Lender shall have the exclusive right to
the possession of the Pledged  Securities  or, if the Pledged  Securities  are
issued in book-entry form or issued in  certificated  form and  delivered to a
clearing corporation (as such term is  defined  in the Uniform Commercial Code
of Minnesota) or its nominee,  the Lender  shall  have  the  right to have the
Pledged Securities registered in the name  of  a  securities  intermediary (as
such term is defined in the Uniform Commercial Code of Minnesota) in an account
containing only customer securities  and credited to an account of the Lender.
The Lender shall have the right to cause  delivery  of the Pledged  Securities
to be made to the Investor or the Pledged Securities  credited  to the account
of the Investor or the Investor's designee only  against   payment   therefor.
The Company acknowledges that the Lender may  enter  into one or more standing
arrangements with other  financial   institutions  with  respect  to   Pledged
Securities issued in book  entry  form or  issued  in  certificated  form  and
delivered to a clearing corporation, pursuant to which such Pledged Securities
are  registered  in  the  name  of  such  financial  institution,  as agent or
securities intermediary  for  the  Lender, and the Company agrees upon request
of the Lender to execute and deliver  to such other financial institutions the
Company's  written  concurrence in any such standing arrangements.

                           3.2(e) Prior   to   the  occurrence  of an Event of
Default,  the Company may redeem a Pledged Mortgage or Pledged  Security  from
the Lender's security interest by notifying  the Lender of  its  intention  to
redeem such Pledged Mortgage or Pledged Security from pledge  and  either  (a)
paying,  or causing an Investor to pay, to  the  Lender,  for  application  to
prepayment of the  principal  balance  of  the  Note,  the  Release  Amount in
connection  with such Pledged Mortgage or Pledged Security,  or (b) delivering
substitute Collateral which,  in addition  to being  acceptable  to the Lender
in its sole  discretion  will,  when included with the  Collateral,  result in
a Collateral Value of all Collateral held  by the  Lender  which  is at  least
equal  to  the  aggregate outstanding Advances.

                           3.2(f) Following the occurrence of a Default or
Event of  Default, the Lender  may, with no  liability  to the  Company or any
Person,  continue to release its security interest in any Pledged  Mortgage or
Pledged Security against payment of the Release Amount in connection with such
Pledged Mortgage or Pledged Security.

                           3.2(g) The amount(the "Release Amount")  to be paid
by the Company to  obtain  the  release of the Lender's security interest in a
Pledged Mortgage shall be (i) prior to the  occurrence of an Event of Default,
the principal amount of the Advances made against such Pledged  Mortgage,  and
(ii) from and after the occurrence and during the  continuance  of an Event of
Default, the Committed Purchase Price of such Pledged Mortgage or, if there is
no   Purchase   Commitment   therefor,   the  amount  paid  to the Lender in a
commercially   reasonable   disposition  thereof,  or  in  connection  with  a
commercially  reasonable disposition of the  property securing  an  Unimproved
Mortgage  Loan or other defaulted Pledged Mortgage.
<PAGE> 62

                  3.3   Delivery   of   Additional  Collateral  or   Mandatory
Prepayment.

             At any time that the aggregate Collateral Value of the Collateral
then pledged hereunder,  other than Unimproved Mortgage Loans is less than the
aggregate  amount  of  the  Advances, other  than  Unimproved  Advances,  then
outstanding  hereunder, the Lender may request, and the Company shall within 2
Business  Days after  Notice  by the  Lender (a)  deliver  to the  Lender  for
pledge  hereunder  additional  Collateral,  other   than  Unimproved  Mortgage
Loans, with a Collateral Value  sufficient to  cover  the  difference  between
the  Collateral  Value of the Collateral  pledged  and the aggregate amount of
Advances, other than Unimproved Advances,  outstanding  hereunder,  and/or (b)
repay  the  Advances  in an amount sufficient to reduce the aggregate  balance
thereof outstanding to or below the Collateral Value of the Collateral pledged
hereunder.

                  3.4      Release of Collateral.

                           3.4(a) The Lender may deliver documents relating
to the Collateral to the Company for correction or completion pursuant to a
Trust Receipt.

                           3.4(b) Prior to the occurrence of  a  Default or
Event of  Default,  upon delivery by the  Company  to the  Lender of  shipping
instructions  pursuant to  Exhibit D-SF,  the  Lender  will  transmit  Pledged
Mortgages  or  Pledged  Securities  and  all  related loan  documents  or pool
documents to the applicable Investor, Approved Custodian or other party.

                           3.4(c) Upon receipt of  Notice from  the  Company
under Section 2.5(g) hereof, and repayment of the Release Amount with respect
to a Pledged Mortgage identified by the Company,  any  Collateral  Documents
relating to the redeemed Pledged Mortgage or Mortgage Loan backing a Pledged
Security which have not been delivered to an Investor or Approved  Custodian
shall be released by the Lender to the Company.

                  3.5  Collection and Servicing  Rights.  So long as no Event
of Default shall have occurred and be  continuing,   the  Company  shall  be
entitled to service and receive and collect directly all sums payable to the
Company in respect of the  Collateral  other than  proceeds of any  Purchase
Commitment  or proceeds  of  the  sale  of  any  Collateral.  Following  the
occurrence of any Event  of  Default,  the  Lender  or  its  designee  shall
thereafter be entitled to service and receive  and  collect all sums payable
to  the  Company  in  respect  of the Collateral,  and in such  case (a) the
Lender or its  designee in its  discretion may, in its own name, in the name
of the Company or otherwise,  demand, sue for, collect or receive any  money
or  property  at  any  time  payable or  receivable  on  account  of  or  in
exchange  for  any  of the  Collateral,  but  shall be under no obligation to
do so, (b) the  Company shall,  if the Lender so requests,  hold in trust for
the  benefit  of the  Lender  and  forthwith  pay to the Lender at its office
designated by Notice  hereunder,  all  amounts  thereafter  received  by  the
Company upon or in respect of any of the Collateral, advising the Lender as to
the source of such funds, and (c) all amounts so received and collected by the
Lender shall be held by it as part of the Collateral.
<PAGE> 63

                  3.6  Return of Collateral at End of  Commitment.  If (a) the
Commitment  shall  have  expired  or  been  terminated, and (b) no Advances,
interest or other  Obligations  shall be outstanding and unpaid,  the Lender
shall deliver  or  release  its  security  interest  and shall  deliver  all
Collateral  in its possession to the Company at the Company's  expense.  The
receipt of the Company for  any  Collateral  released  or  delivered  to the
Company  pursuant  to any provision  of this  Agreement  shall be a complete
and full  acquittance  for the Collateral so returned,  and the Lender shall
thereafter be discharged from any liability or responsibility therefor.

4.       CONDITIONS PRECEDENT.

                  4.1 Effectiveness of this Agreement.  This Agreement shall not
become effective  unless, in the sole discretion of the Lender, on or before the
Effective Date, the following conditions precedent are satisfied:

                      4.1(a) The Lender shall have received the  following,
all of which must be  satisfactory  in form and content to the Lender, in its
sole discretion:

                                (1)     The Note and this  Agreement duly
                                executed by the Company.

                                (2) The Company's articles or certificate of
                                incorporation  as certified by the Secretary
                                of  State  of the  Company's  incorporation,
                                bylaws certified by the corporate  secretary
                                of t he  Company,  or a  Certificate  of the
                                Company  stating  that  there  has  been  no
                                change in either the articles or certificate
                                of   incorporation  or  bylaws  since  those
                                delivered  in  connection  with the Existing
                                Credit  Agreement dated August 31, 1995, and
                                certificates  of good standing dated no less
                                recently  than 90 days  prior to the date of
                                this Agreement.

                                (3) A  resolution  of the board of directors
                                of the Company,  certified as of the date of
                                this  Agreement by its corporate  secretary,
                                authorizing  the  execution,   delivery  and
                                performance  of this Agreement and the other
                                Loan Documents, and all other instruments or
                                documents  to be  delivered  by the  Company
                                pursuant to this Agreement.
<PAGE> 64

                                (4) A certificate of the Company's corporate
                                secretary   as   to   the   incumbency   and
                                authenticity   of  the   signatures  of  the
                                officers  of  the  Company   executing  this
                                Agreement  and the other Loan  Documents and
                                each   Advance   Request   and   all   other
                                instruments  or  documents  to be  delivered
                                pursuant  hereto (the Lender being  entitled
                                to rely thereon until a new such certificate
                                has been furnished to the Lender).

                                (5) A favorable  written  opinion of counsel
                                to the Company  (or of  separate  counsel at
                                the option of the Company),  dated as of the
                                date of this Agreement  substantially in the
                                form of Exhibit H attached hereto, addressed
                                to the Lender.

                                (6) Uniform  Commercial  Code,  tax lien and
                                judgment searches of the appropriate  public
                                records  for  the  Company,  which  searches
                                shall not have  disclosed  the  existence of
                                any prior Lien on the Collateral  other than
                                in  favor  of  the  Lender  or as  permitted
                                hereunder.

                                (7) Copies of the certificates, documents or
                                other written instruments which evidence the
                                Company's  eligibility  described in Section
                                5.13  hereof,  all  in  form  and  substance
                                satisfactory to the Lender.

                                (8)  Copies  of  the  Company's  errors  and
                                omissions   insurance   policy  or  mortgage
                                impairment insurance policy and blanket bond
                                coverage policy,  or certificates in lieu of
                                policies,    all   in   form   and   content
                                satisfactory   to   the   Lender,    showing
                                compliance  by the Company as of the date of
                                this Agreement  with the related  provisions
                                of Section 6.8 hereof.

                                (9)   Executed   financing   statements   in
                                recordable  form covering the Collateral and
                                ready  for   filing  in  all   jurisdictions
                                required by the Lender.

<PAGE> 65

                                (10) Payment of all principal and interest
                                for all Advances outstanding under the
                                Existing Credit Agreement that were made
                                against a pledge of collateral that does
                                not fit the definition of Eligible Loan in
                                this Agreement.

                                (11) Payment of any fees due on or before
                                the Effective Date, including, but not
                                limited to, Commitment Fees and document
                                production fees.

                                (12) Evidence that all accounts necessary
                                into which Advances will be funded have
                                been established at the Funding Bank and
                                receipt of a fully executed Funding Bank
                                Agreement.

                      4.1(b) All directors,  officers and  shareholders  of
the  Company,   all  Affiliates  of  the  Company  or  of  any Subsidiary  of
the  Company,  to whom  or to any of  whom  the Company  shall be indebted  as
of the date of this  Agreement,  shall have  subordinated such indebtedness to
the Obligations, by executing a Subordination of Debt Agreement, in the form
of Exhibit F hereto; provided,  however, that earned salaries and bonuses and
expense  reimbursements  owed to officers of the Company  shall be  excluded
from  this  requirement;  and the Lender  shall  have  received  an  executed
copy of any such Subordination of Debt  Agreement,  certified by the corporate
secretary  of the Company to be true and  complete and in full force and effect
as of the date of the  Advance.  This Section 4.1(b)  shall  not  apply  to
unsecured  indebtedness  of the Company  to  its  corporate   Affiliates  for
funds  lent to originate  Mortgage  Loans, or to unclaimed  bondholder  funds
held and administered by the Company for its Subsidiaries.

                  4.2 Each Advance.  The obligation  of the Lender to make the
initial  and each  subsequent Advance under this  Agreement  is subject to the
satisfaction, in the sole discretion of the Lender, as of the date of each
such Advance, of the following additional conditions precedent:

                      4.2(a) The Company shall have delivered to the Lender
the  Advance Request,  Collateral  Documents, and documents relating to Wet
Settlement Advances, called for under, and shall have satisfied the procedures
set forth in, Section 2.2 hereof and the applicable Exhibits hereto described
in that Section,  according to the type of the requested  Advance.  All items
delivered to the Lender shall be satisfactory   to   the   Lender in form and
content,  and   the   Lender   may   reject   such of them as do not meet the
requirements  of this Agreement or of  the related Purchase Commitment.

<PAGE> 66

                      4.2(b)  The  Lender  shall  have  received   evidence
satisfactory to it as to the making and/or continuation of any book entry or
the due filing and recording in all  appropriate offices of all financing
statements and other  instruments as may be  necessary  to perfect  the
security  interest  of the Lender in the Collateral under the Uniform
Commercial Code or other applicable law.

                      4.2(c)  The  representations  and  warranties  of the
Company  contained  in Article 5 hereof  shall be accurate and complete in all
material  respects as if made on and as of the  date of each Advance.

                      4.2(d)  The   Company   shall  have   performed   all
agreements to be performed by it  hereunder,  and after giving effect to the
requested Advance, there shall exist no Default or Event of Default hereunder.

                      4.2(e)  The  Company  shall  not  have  incurred  any
material liabilities,  direct or contingent, other than in the ordinary course
of its business, since the Statement Date.

                      4.2(f)  The Lender  shall  have  received  from  counsel
for the  Company,  if  requested  by the  Lender  in its  sole discretion,  an
updated  opinion,   in  form  and  substance  satisfactory   to  the   Lender,
addressed  to  the  Lender  and dated as of the date of such Advance, covering
such of the matters as the Lender may reasonably request.

                  Delivery of an Advance Request by the Company shall be
deemed a representation by the Company that all conditions set forth in this
Section 4.2 shall have been satisfied as of the date of such Advance.

5.       REPRESENTATIONS AND WARRANTIES.

                  The Company hereby represents and warrants to the Lender  as
of the  Effective  Date  and  as  of  the date of each Advance Request and the
making of each Advance, that:

                  5.1 Organization; Good Standing; Subsidiaries. The Company
and each  Subsidiary of the Company is a corporation duly organized, validly
existing and  in  good  standing  under  the laws of the jurisdiction of its
incorporation, has the full legal power  and  authority  to own its property
and to carry on its business as currently conducted and is duly qualified as
a foreign  corporation to do  business  and  is  in  good  standing  in each
jurisdiction  in   which  the transaction  of   its  business   makes   such
qualification  necessary,  except in jurisdictions,  if any, where a failure
to be in good  standing  has  no  material  adverse  effect on the business,
operations,  assets  or  financial  condition  of  the  Company or any  such
Subsidiary. For the purposes hereof, good standing shall include qualification
for any and all licenses and payment  of  any and all taxes required  in the
jurisdiction of its  incorporation  and in  each  jurisdiction  in which the
Company transacts business. The Company has no Subsidiaries except as set

<PAGE> 67

forth on Exhibit G hereto.  Exhibit G sets  forth with  respect to each such
Subsidiary, its name, address, place of incorporation, each state in which it
is qualified as a foreign corporation,  and the percentage ownership of its
capital stock by the Company.

                  5.2  Authorization and Enforceability.  The  Company has the
power and authority to execute, deliver and perform  this Agreement, the Note
and all other Loan Documents to which the Company  is  party  and to make the
borrowings hereunder. The execution, delivery and performance by  the Company
of this Agreement, the Note and all other Loan Documents to which the Company
is party and the making of the borrowings hereunder and thereunder, have been
duly and validly  authorized  by all  necessary corporate action on the party
of the Company (none of which actions has been modified or rescinded, and all
of which actions are in full force and effect)   and  do  not  and  will  not
conflict  with or violate any provision of law, of any judgments binding upon
the Company,  or of the articles of incorporation or by-laws of the  Company,
conflict with or result in a breach of or constitute a default or require any
consent  under,  or result in the  creation of any Lien upon any property  or
assets of the Company other than the Lien on the Collateral granted hereunder,
or result in or require the acceleration  of any  indebtedness of the Company
pursuant to any  agreement, instrument or indenture to which the Company is a
party or  by which the Company or its property may be bound or affected. This
Agreement,  the  Note  and  all other Loan Documents  contemplated  hereby or
thereby constitute legal,  valid,  and binding  obligations  of  the  Company
enforceable  in   accordance  with  their respective terms, except as limited
by bankruptcy, insolvency  or other such laws affecting  the  enforcement  of
creditors'  rights and by general  principles of equity.

                  5.3  Approvals. The execution and delivery of this Agreement,
the Note and all other  Loan  Documents  and the  performance of the Company's
obligations hereunder  and  thereunder  and  the  validity  and enforceability
hereof and thereof  do  not require any license,  consent, approval  or  other
action of any state  or federal agency or governmental or regulatory authority
other than those which have been obtained and remain in full force and effect.

                  5.4  Financial Condition.  The balance sheet of the Company
(and, if applicable,  its Subsidiaries,  on a  consolidated  basis) as of the
Statement   Date,   and the related  statements  of  income  and  changes  in
stockholders'  equity for the fiscal  period  ended  on the  Statement  Date,
heretofore furnished to the Lender, fairly present the financial condition of
the Company (and its Subsidiaries) as of the Statement Date and the results of
its operations for the fiscal period ended on the Statement Date. The Company
had, on the Statement Date, no known material liabilities, direct or indirect,
fixed or contingent, matured or unmatured, or liabilities for taxes, long-term
leases or unusual forward or long-term commitments not disclosed by, or
reserved against in, said balance sheet and related  statements,  and at the
present time there are no material unrealized or anticipated losses from any
loans,  advances or other commitments of the Company except as heretofore
disclosed to the Lender in writing.  Except as  disclosed  on the  interim
financial  statements,  said financial statements were prepared in accordance

<PAGE> 68
with GAAP applied on a consistent  basis  throughout the periods  involved.
Since the Statement  Date, there has been no material adverse change in the
business, operations, assets or financial  condition of the Company (and its
Subsidiaries),  nor is the Company aware of any state of facts  which  (with
or without  notice or lapse of time or both) would or could result in any such
material adverse change.

                  5.5  Litigation.  There are no actions,  claims,  suits  or
proceedings  pending  or,  to  the  knowledge of the Company,  threatened  or
reasonably anticipated against or affecting the  Company or any Subsidiary of
the Company in any court or before any arbitrator or  before  any  government
commission, board, bureau or other administrative  agency which, if adversely
determined, may reasonably be expected to result in any  material and adverse
change in  the  business,  operations,  assets or  financial condition of the
Company as a whole,  or which would affect  the  validity  or  enforceability
of this Agreement, the Note or any other Loan Document.

                  5.6  Compliance  with  Laws.  Neither the Company  nor  any
Subsidiary of the Company is in violation of any provision of any law, or of
any judgment, award, rule, regulation, order, decree,  writ or injunction of
any court or public regulatory body or authority which might have a material
adverse effect on the business, operations, assets or financial condition of
the   Company   as   a   whole  or  which  would  affect   the  validity  or
enforceability  of this Agreement, the  Note  or  any  other  Loan Document.

                  5.7  Regulation U. The Company is not engaged principally,
or as one of its important activities,  in the business of extending credit
for the purpose of purchasing or carrying  Margin Stock,  and no part of the
proceeds of any Advances made  hereunder  will be used to purchase or carry
any Margin Stock or to extend credit to others for the purpose of purchasing
or  carrying  any Margin Stock.

                  5.8  Investment Company Act. The Company is not an
"investment company" or  controlled  by an  "investment  company"  within the
meaning of the Investment Company Act of 1940, as amended.

                  5.9  Payment of Taxes. The Company, through the Parent, has
filed or caused to be filed all federal,  state  and  local  income,  excise,
property and other tax returns with respect to the operations of the Company
and its Subsidiaries which are required to be filed except such taxes, if any,
as are being  contested  in good faith and for which  adequate  reserves  have
been provided,  all such returns are true and correct,  and the Company,
through the Parent,  has paid or caused to be paid all taxes as shown on such
returns or on any assessment,  to the extent that such taxes have become due,
including,  but not limited to, all FICA payments and withholding  taxes,  if
appropriate.  The amounts reserved,  if any, as a liability for income and
other taxes payable, in the  financial  statements  described in Section 5.4
hereof are  sufficient  for payment of all unpaid  federal,  state and local
income,  excise,  property and other  taxes,  whether or not  disputed,  of
the Company and its Subsidiaries accrued  for or  applicable  to the  period
and on the dates of such  financial statements and all years and periods prior
thereto and for which the Company and its Subsidiaries may be liable in its

<PAGE> 69

own right or as transferee of the assets of,  or as  successor  to,  any other
person or  entity.  The  Company  and its Subsidiaries are included in the
consolidated federal income tax return filed by the Parent.  The  Company's
income tax  provisions,  if any,  are recorded on a separate entity basis and
are in accordance with a tax allocation agreement with the  Parent.  No tax
Liens  have been  filed and no  material  claims  are being asserted with
respect to any such taxes, fees or charges.

                  5.10 Agreements. Neither the Company nor any Subsidiary of
the Company is a party to any agreement, instrument or indenture or subject to
any restriction materially and adversely affecting its business,  operations,
assets or financial condition, except as disclosed in the financial statements
described in Section 5.4 hereof.  Neither the Company nor any  Subsidiary of
the Company is in default in the performance, observance or fulfillment of any
of the obligations, covenants or conditions contained in any agreement,
instrument, or indenture which default could have a material adverse effect on
the business, operations,  properties or financial condition of the Company as
a whole.  No holder of any  indebtedness  of the  Company or of any of its
Subsidiaries  has given  notice  of  any  asserted  default  thereunder,  and
no  liquidation  or dissolution of the Company or of any of its  Subsidiaries
and no receivership, insolvency, bankruptcy,  reorganization or other similar
proceedings relative to the Company or of any of its  Subsidiaries  or any of
its properties is pending, or to the knowledge of the Company, threatened.

                  5.11 Title to Properties. The Company and each Subsidiary of
the  Company  has good,  valid,  insurable  (in the case of real property) and
marketable title to all of its properties and assets (whether real or
personal, tangible or  intangible)  reflected  on the  financial  statements
described in Section 5.4 hereof,  except for such properties and assets as
have been disposed of since the date of such  financial  statements  as no
longer used or useful in the conduct of its business or as have been disposed
of in the ordinary  course of business,  and all such properties and assets
are free and clear of all Liens except as disclosed in such financial
statements.

                  5.12 ERISA. All plans ("Plans") of a type described in
Section 3(3) of ERISA in respect of which the Company or any  Subsidiary  of
the Company is an "Employer," as  defined  in Section  3(5) of ERISA,  are in
substantial compliance with ERISA, and none of such Plans is insolvent or in
reorganization, has an accumulated or waived  funding  deficiency  within the
meaning of Section 412 of the Internal  Revenue Code, and neither the Company
nor any Subsidiary of the  Company  has  incurred  any  material  liability
(including  any  material contingent  liability) to or on account of any such
Plan  pursuant  to Sections 4062, 4063, 4064, 4201 or 4204 of ERISA; and no
proceedings have been instituted to terminate any such Plan,  and no condition
exists which  presents a material risk to the Company or a  Subsidiary  of the
Company of incurring a liability to or on account of any such Plan pursuant to
any of the  foregoing  Sections  of ERISA.  No Plan or  trust  forming  a part
thereof  has been  terminated  since September 1, 1974.




<PAGE> 70

                  5.13 Eligibility. The Company is approved and qualified and
in good standing as a lender or seller/servicer,  as set forth below, and
meets all requirements applicable to its status as such:

                           5.13(a) Ginnie  Mae approved   seller/servicer   of
Mortgage Loans and issuer of Mortgage-backed Securities guaranteed by Ginnie
Mae.

                           5.13(b) Fannie Mae approved  seller/servicer   of
Mortgage Loans, eligible to originate,  purchase,  hold, sell, and service
Mortgage Loans to be sold to Fannie Mae.

                           5.13(c) Freddie  Mac  approved  seller/servicer of
Mortgage Loans,  eligible to originate,  purchase,  hold, sell and service
Mortgage Loans to be sold to Freddie Mac.

                           5.13(d) Lender in good standing  under the VA loan
guarantee program eligible to originate,  purchase, hold, sell and service
VA-guaranteed Mortgage Loans.

                           5.13(e) HUD approved   mortgagee,   eligible   to
originate,  purchase, hold, sell and service FHA fully insured Mortgage Loans.

                           5.13(f) Lender in good standing under the FmHA loan
guarantee program eligible to originate,  purchase, hold, sell and service
FmHA-guaranteed Mortgage Loans.

                  5.14 Place of Business. The principal place of business of
the Company is 311 Park Place Boulevard, P.O. Box 4929, Clearwater, Florida
33759.

                  5.15 Special Representations   Concerning Collateral.   The
Company hereby represents and warrants to the Lender,  as of the date of this
Agreement and as of the date of each Advance Request  and the  making of each
Advance, that:

       5.15(a) The Company is the legal and equitable owner and holder,  free
  and clear of all Liens (other than Liens granted hereunder), of the Pledged
  Mortgages  and the  Pledged  Securities.  All  Pledged  Mortgages,  Pledged
  Securities and Purchase  Commitments  have been duly authorized and validly
  issued to the Company,  and all of the foregoing items of Collateral comply
  with all of the  requirements  of this  Agreement,  and have  been and will
  continue to be validly  pledged or  assigned  to the Lender,  subject to no
  other Liens.

       5.15(b) The Company  has, and will  continue to have,  the full right,
  power and authority to pledge the  Collateral  pledged and to be pledged by
  it hereunder.


<PAGE> 71

       5.15(c) Any  Mortgage  Loan and any related  document  included in the
  Pledged  Mortgages  (1)  other  than  in the  case  of a  Construction/Perm
  Mortgage Loan or an Unimproved  Mortgage  Loan,  has been duly executed and
  delivered  by the parties  thereto at a closing  held not more than 90 days
  prior to the date of the Advance  Request for such Mortgage  Loan,  (2) has
  been made in compliance with all requirements of the Real Estate Settlement
  Procedures Act, Equal Credit Opportunity Act, the federal  Truth-In-Lending
  Act and all other applicable laws and regulations, (3) is and will continue
  to be valid and enforceable in accordance  with its terms,  without defense
  or offset,  (4) has not been modified or amended  except in writing,  which
  writing is part of the Collateral  Documents,  nor any requirements thereof
  waived, (5) other than in the case of an Unimproved Mortgage Loan, has been
  evaluated  or  appraised  in  accordance  with Title XI of FIRREA,  and (6)
  complies and will continue to comply with the terms of this  Agreement and,
  if applicable,  with the related  Purchase  Commitment held by the Company.
  Each Mortgage Loan, other than in the case of a Construction/Perm  Mortgage
  Loan,  has been fully advanced in the face amount  thereof,  and each First
  Mortgage is a first Lien on the premises described therein, and has or will
  have a title insurance  policy,  in American Land Title Association form or
  equivalent thereof, from a recognized title insurance company, insuring the
  priority of the Lien of the Mortgage and meeting the usual  requirements of
  Investors purchasing such Mortgage Loans.

       5.15(d) No default has occurred and is continuing for more than (i) in
  the case of an Unimproved  Mortgage Loan included in the Pledged Mortgages,
  30 days,  or (ii) in the case of any other  Mortgage  Loan  included in the
  Pledged  Mortgages,  60 days,  without the  Advance  against  such  Pledged
  Mortgage having been repaid in accordance with Section 2.5(c)(3), 2.5(c)(4)
  hereof,  provided,  however,  that with respect to Pledged  Mortgages which
  have  already  been  pledged as  Collateral  hereunder,  if any default has
  occurred, the Company will promptly notify the Lender.

       5.15(e) The Company has complied and will  continue to comply with all
  laws, rules and regulations in respect of the FHA insurance,  FmHA guaranty
  or VA  guaranty of each  Mortgage  Loan  included in the Pledged  Mortgages
  designated by the Company as an FHA insured,  FmHA guaranteed Mortgage Loan
  or VA guaranteed Mortgage Loan, and such insurance or guarantee is and will
  continue  to be in full  force  and  effect.  All  such FHA  insured,  FmHA
  guaranteed  Mortgage Loans and VA guaranteed Mortgage Loans comply and will
  continue to comply in all respects  with all  applicable  requirements  for
  purchase  under the Fannie Mae  standard  form of selling  contract for FHA
  insured,  FmHA guaranteed  loans and VA guaranteed loans and any supplement
  thereto then in effect.

       5.15(f)  All  fire  and  casualty   policies   covering  the  premises
  encumbered by each Mortgage  included in the Pledged Mortgages (1) name and
  will  continue to name the Company  and its  successors  and assigns as the
  insured under a standard  mortgagee clause, (2) are and will continue to be
  in full  force and  effect,  and (3)  afford  and will  continue  to afford
  insurance  against fire and such other risks as are usually insured against
  in the  broad  form  of  extended  coverage  insurance  from  time  to time
  available.
<PAGE> 72

       5.15(g)  Pledged  Mortgages  secured by premises  located in a special
  flood  hazard  area  designated  as such  by the  Director  of the  Federal
  Emergency Management Agency are and shall continue to be covered by special
  flood insurance under the National Flood Insurance Program.

       5.15(h) Each Pledged Mortgage, against which an Advance is made on the
  basis of a Purchase  Commitment,  meets all  requirements  of such Purchase
  Commitment.  The Company  shall  assure that  Pledged  Mortgages  which are
  intended to be used in the formation of  Mortgage-backed  Securities  shall
  comply or,  prior to the  formation of any such  Mortgage-backed  Security,
  shall comply with the  requirements  of the  governmental  instrumentality,
  department,   agency  or  other  Person   issuing  or   guaranteeing   such
  Mortgage-backed Security.

       5.15(i)  ForPledged  Mortgages  which will be used to back  Ginnie Mae
  Mortgage-backed  Securities,  the  Company has  received  from Ginnie Mae a
  Confirmation   Notice  or  Confirmation   Notices  for  Request  Additional
  Commitment  Authority  and for  Request  Pool  Numbers,  and there  remains
  available  thereunder a commitment on the part of Ginnie Mae  sufficient to
  permit the issuance of Ginnie Mae  Mortgage-backed  Securities in an amount
  at least equal to the amount of such Pledged Mortgages designated by the
  Company  as the  Mortgage  Loans to be used to back  such  Ginnie  Mae
  Mortgage-backed  Securities; each such Confirmation Notice is in full force
  and effect; each of such Pledged Mortgages has been assigned by the Company
  to one of such Pool  Numbers  and a portion  of the  available  Ginnie  Mae
  Commitment has been allocated thereto by the Company, in an amount at least
  equal to such Pledged  Mortgages;  and each such  assignment and allocation
  has been reflected in the books and records of the Company.

       5.15(j) No Pledged  Mortgage  securing an Advance is secured by a Lien
  on a Manufactured Home.

                  5.16  Servicing. Attached hereto as  Exhibit E is a true and
complete  list  of the  Company's Servicing Portfolio.  All  of the  Company's
Servicing Contracts are in full  force and  effect  and,  except as  otherwise
indicated, are unencumbered by Liens. No default or event which, with notice
or lapse of time or both, would become a default, exists under any such
Servicing Contract.

                  5.17 Special Representations Concerning Construction
Advances. The Company hereby represents and warrants to the Lender, as of the
date of this Agreement and as of the date of each Advance Request, that:

       5.17(a) Each  Construction/Perm  Mortgage Loan included in the Pledged
  Mortgages (1) has an American Land Title Association Lender's  construction
  loan policy or equivalent thereto with mechanics' lien coverage, (2) has an
  Assignment  of  Plan  and  Specifications,  and an  Assignment  of  General
  Construction  Contract,   that  inure  to  the  benefit  of  the  Company's
  successors and assigns, (3) has "all risk" builder's insurance and workers'
  compensation  insurance that name and will continue to name the Company and
  its  successors  and  assigns as the  insured  under a  standard  mortgagee

<PAGE> 73

  clause, (4) has a certification of no hazardous materials, (5) has a survey
  prepared  and  certified  by  a  duly   registered   surveyor   showing  no
  encroachments  of the  improvements  or  the  proposed  improvements  to be
  constructed on the premises  encumbered by the Pledged Mortgage on to other
  lands or easements or  restrictions,  unless such  encroachments  have been
  insured over or are  acceptable to the Investor,  (6) has building  permits
  and all  necessary  licenses  and  approvals  for the  construction  of the
  improvements on the premises encumbered by the Pledged Mortgage,  (7) has a
  "as completed"  appraisal giving an As Completed Appraised Value, (8) has a
  fixed price General Contract issued by a licensed  contractor,  and (9) has
  all necessary utilities available to the premises encumbered by the Pledged
  Mortgage.

       5.17(b)  Prior to the  initial  Construction  Advance  against  a
  Pledged Mortgage, the Company shall have received (1) a Cost Breakdown
  and (2) a draw schedule.

       5.17(c)  Prior to each  Construction  Advance,  the Company shall
  have  received  (1) a  report  of  the  stage  of  completion  of  the
  improvements as set forth in the construction accounting system of the
  Parent  confirming  completion of the work for which the  Construction
  Advance  is  being  requested  and  (2)  a  title  insurance   updated
  endorsement  for such  Construction  Advance  if the  title  insurance
  policy has a "pending  disbursements  clause" requiring an endorsement
  to the title  insurance  policy to insure  each  Construction  Advance
  after the closing of the Construction/Perm Mortgage Loan.


      5.17(d)  Prior to the final  Construction  Advance,  the  Company
  shall have received (1) a final appraiser inspection report confirming
  completion of all work in accordance with the plans and specifications
  and (2) a final "as built" survey.

      5.17(e)   If   applicable,   within  15  days   after  the  final
  Construction  Advance the Company  shall  receive  any  Mortgage  Note
  modification or modified  Mortgage Note delivered in connection with a
  Construction/Perm  Mortgage Loan and a title  insurance  policy update
  endorsement  for  modification  of such  Mortgage  Loan to a Permanent
  Mortgage Loan.

                  5.18  No Adverse Selection.  The Company has not selected
 the Collateral in a manner so as to affect adversely the Lender's interests.

                  5.19  Year  2000  Compliance.  The  Company has conducted a
comprehensive review and assessment of the Company's computer applications and
made inquiry of the Company's key suppliers, vendors, customers, and Investors
with respect to the "Year 2000 Problem" and, based on that review and inquiry,
the Company  does not believe  the Year 2000 Problem will result in a material
adverse change in the Company's business  condition  (financial or otherwise),
operations, properties or prospects, or ability to repay the credit.
<PAGE> 74

6.       AFFIRMATIVE COVENANTS.

                  The Company hereby covenants and agrees that, so long as the
Commitment  is  outstanding or there  remain  any  Obligations  to be  paid or
performed under this Agreement or under any other Loan  Document,  the Company
shall:

                  6.1  Payment of Note. Punctually pay or cause to be paid all
Obligations payable hereunder and under the Note in accordance  with the terms
hereof and thereof.

                  6.2  Financial Statements and Other Reports.  Deliver to
the Lender:

       6.2(a) As soon as available and in any event within 30 days after
  the end of each calendar month of the Company,  statements of income
  and  changes in  stockholders'   equity  of  the  Company  (and,  if
  applicable, its Subsidiaries,  on  a  consolidated  basis)  for  the
  immediately preceding month and for the period from the beginning of
  the fiscal year to the end of such  calendar month,  and the related
  balance sheet as of the end of the immediately preceding month, all
  in reasonable detail and certified as to the fairness of
  presentation by the chief financial officer of the  Company,
  subject,  however,  to year-end audit adjustments.

       6.2(b) As soon as available and in any event within 90 days
  after the end of each fiscal year of the Company, statements of
  income, changes in stockholders' equity and cash flow of the
  Company (and, if applicable, its Subsidiaries,  on a consolidated
  basis) for such year,  and the  related  balance  sheet as of the
  end of such year (setting forth in comparative form the
  corresponding  figures for the preceding fiscal year),  all in
  reasonable  detail and accompanied by an opinion (which opinion
  shall not be qualified due to possible  failure to take
  all appropriate  steps to  successfully  address Year 2000 Problem) in
  form and  substance  satisfactory  to the  Lender and  prepared  by an
  accounting  firm  reasonably  satisfactory  to the  Lender,  or  other
  independent   certified  public  accountants  of  recognized  standing
  selected  by the  Company and  acceptable  to the  Lender,  as to said
  financial  statements and a certificate  signed by the chief financial
  officer of the Company stating that said financial  statements  fairly
  present  the  financial  condition  and results of  operations  of the
  Company (and, if applicable,  its  Subsidiaries) as of the end of, and
  for, such year.

       6.2(c)  Together  with  each  delivery  of  financial
  statements   required  in  this   Section  6.2,  an  Officer's
  Certificate  substantially in the form of Exhibit I-SF hereto:
  (1)  setting  forth  in  reasonable  detail  all  calculations
  necessary to show that the Company is in  compliance  with the
  requirements of Sections 7.6, and 7.7, hereof as of the end of
  such month or year (or, if the  Company is not in  compliance,
  showing the extent of non-compliance and specifying the period
  of  non-compliance  and what actions the Company has taken, is

<PAGE> 75

  taking  or  proposes  to  take  with  respect  thereto);   (2)
  certifying  that the Company was, as of the end of the period,
  in compliance and in good standing with applicable HUD, Ginnie
  Mae, or Investor net worth requirements; (3) certifying that the
  representation set forth in Section  5.19  hereof is true and
  correct as of the date of  such  certificate or, if such
  representation is not true and correct as of such date, specifying
  the nature of the problem and what action the Company has taken,
  is taking and proposes to take with request thereto, and (4) stating
  that the signers have  reviewed the terms of this  Agreement  and
  have made, or caused  to be  made  under  their  supervision,  a
  review  in reasonable  detail of the  transactions  and conditions
  of the Company  (and, if  applicable,  its  Subsidiaries)  during the
  accounting  period  covered by such  financial  statements and
  that such review has not disclosed the existence  during or at
  the end of such accounting period, and that the signers do not
  have  knowledge  of  the  existence  as of  the  date  of  the
  Officer's Certificate,  of any Default or Event of Default, or
  if  any  Default  or  Event  of  Default  existed  or  exists,
  specifying the nature and period of the existence  thereof and
  what action the Company has taken,  is taking and  proposes to
  take with respect thereto.

       6.2(d)  Weekly or more  frequently  as the Lender may
  from time to time request,  a commitment  summary and pipeline
  report substantially in the form of Exhibit L (the "Commitment
  Summary Report") dated as of the close of business on the last
  Business  Day of each  week  and  provided  to the  Lender  by
  facsimile by 10:00 a.m. on the next succeeding Business Day of
  the following week, and the signed  original  thereof shall be
  sent to the Lender by first class mail on such next succeeding
  Business Day.

       6.2(e) As soon as  available  and in any event within
  30 days after the end of each calendar  month,  a consolidated
  report (the "Servicing Portfolio Report") as of the end of the
  calendar  month  detailing,  as  to  all  Mortgage  Loans  the
  servicing rights to which are owned by the Company  (specified
  by investor  type,  recourse and  non-recourse)  regardless of
  whether such  Mortgage  Loans are Pledged  Mortgages and which
  report shall indicate Mortgage Loans which (A) are current and
  in good  standing,  (B) are more  than 30,  60 or 90 days past
  due,  respectively,  (C) are, for Mortgage Loans serviced with
  recourse,  more than three  hundred 360 days past due, (D) are
  the subject of pending bankruptcy or foreclosure  proceedings,
  or (E)  have  been  converted  (through  foreclosure  or other
  proceedings  in lieu  thereof) by the Company into real estate
  owned by the Company.

<PAGE> 76

       6.2(f)  Reports in respect of the  Pledged  Mortgages
  and Pledged Securities in such detail and at such times as the
  Lender in its discretion may reasonably request at any time or
  from time to time.

       6.2(g)  Copies of all regular or  periodic  financial
  and other  reports,  if any, which the Company shall file with
  the  Securities  and Exchange  Commission or any  governmental
  agency  successor  thereto,  copies of any audits completed by
  Ginnie  Mae,  Fannie  Mae or  Freddie  Mac and  copies  of the
  Mortgage Bankers' Financial  Reporting Forms (Freddie Mac Form
  1055/Fannie  Mae Form 1002)  which the  Company is required to
  have filed, as the Lender may reasonably request.

       6.2(h) From time to time, with reasonable promptness,
  such further information  regarding the business,  operations,
  properties or financial condition of the Company as the Lender
  may reasonably request.

       6.2(i)  With each  Officer's  Certificate,  a monthly
  status  report  on  each   Construction/Perm   Mortgage  Loan,
  including,  without  limitation,  the loan  number,  mortgagor
  name(s), property address, general contractor name, completion
  status  (percent  completed  or  staged  draw  no.  and  brief
  description),  estimated completion date, date of last on-site
  inspection, and Pledged Mortgage payment status.

                6.3  Maintenance of Existence;  Conduct of Business.  Preserve
and maintain its corporate  existence in good  standing and all of its rights,
privileges, licenses and franchises necessary or desirable in the normal
conduct of its business, including, without limitation, its eligibility as
lender, seller/servicer  and issuer  described  under  Section 5.13 hereof;
conduct its business in an orderly and efficient manner;  maintain a net
worth of acceptable assets  as  required  for  maintaining  the  Company's
eligibility  as  lender, seller/servicer  and issuer described under Section
5.13 hereof;  not change the nature or character of its business;  not engage
in any business in which it was not  engaged on the date of this  Agreement;
and not change its name, state of incorporation or principal place of business.

                6.4  Compliance   with  Applicable   Laws.   Comply  with  the
requirements of all applicable  laws,  rules,  regulations  and  orders of any
governmental authority, a breach of which could materially adversely affect
its business, operations, assets, or financial condition, except where
contested in good faith and by appropriate proceedings.

<PAGE> 77
                6.5  Inspection of  Properties  and Books.  Permit  authorized
representatives  of the Lender or any Participant  to  discuss  the  business,
operations, assets and financial condition of the Company and its Subsidiaries
with its officers and  employees  and to examine its books of account and make
copies or extracts thereof, all at such reasonable  times as the Lender or any
Participant may request. The Company will provide its accountants with a copy
of this Agreement promptly after the execution hereof and will  instruct  its
accountants to answer candidly any and all questions that the officers of the
Lender or any Participant or any authorized representatives of the Lender or
any Participant may address to them in reference to the financial condition or
affairs of the Company and  its  Subsidiaries.  The  Company  may  have  its
representatives in attendance  at any  meetings  between the officers or other
representatives of the Lender or any Participant  and the Company  accountants
held in accordance with this authorization.

                  6.6  Notice. Give prompt  Notice  to the  Lender  of (a) any
action, suit or  proceeding instituted by or against the Company or any of its
Subsidiaries in any federal or state court or before any  commission  or other
regulatory  body (federal, state or local,  domestic or foreign) which action,
suit or proceeding has at issue in excess of $250,000, or any such proceedings
threatened  against  the Company or  any  of  its  Subsidiaries  in a  writing
containing the details thereof, (b) the filing, recording or assessment of any
federal, state or local tax Lien against the Company,  or any of its assets or
any of its Subsidiaries, (c) the occurrence of any Event of Default hereunder
or the occurrence of any Default  and  continuation  thereof for 5 days,  (d)
the suspension,  revocation  or  termination  of the Company's  eligibility,
in any respect,  as  approved  lender, seller/servicer or issuer as  described
under Section 5.13 hereof,  (e) the  transfer,  loss or  termination  of any
Servicing Contract  to which the Company is a party,  or which is held for the
benefit of the Company, and the reason for such transfer, loss or termination,
if known to the Company,  and (f) any other  action,  event or condition of
any nature which may  lead  to  or  result  in a  material  adverse  effect
upon  the  business, operations,  assets, or financial  condition of the
Company and its Subsidiaries or which,  with or without notice or lapse of
time or both, would constitute a default under any other agreement, instrument
or indenture to which the Company or any of its  Subsidiaries  is a party or
to which  the  Company  or any of its Subsidiaries, its properties, or assets
may be subject.

                  6.7  Payment of  Debt,  Taxes,  etc.  Pay  and  perform  all
obligations and indebtedness of the Company, and cause to be paid and performed
all obligations and indebtedness of its Subsidiaries, promptly and in
accordance with the terms thereof and pay and discharge or cause to be paid
and discharged promptly all taxes, assessments and governmental charges or
levies imposed upon the Company or its  Subsidiaries or upon their respective
income,  receipts or properties  before the same shall become past due, as
well as all lawful  claims for labor,  materials and supplies or otherwise
which, if unpaid, might become a Lien or charge upon such properties or any
part thereof; provided, however, that the Company and its Subsidiaries shall
not be required to pay taxes, assessments or governmental charges or levies
or claims for labor, materials or supplies for which the Company or its
Subsidiaries  shall have  obtained an adequate bond or adequate  insurance
or which are being  contested  in good  faith and by proper proceedings  which
are being reasonably and diligently pursued and for which proper reserves have
been created.
<PAGE> 78

                  6.8 Insurance.  Maintain (a) errors and omissions insurance
or mortgage impairment insurance and blanket bond coverage, with such companies
and in such amounts as satisfy prevailing requirements applicable to a lender,
seller/servicer and issuer described  under  Section  5.13  hereof,  and  (b)
liability insurance and fire and other hazard insurance on its properties,
with responsible insurance companies approved by the Lender, in such  amounts
and against such risks as is customarily carried by similar businesses
operating in the same vicinity;  and (c) within 30 days after Notice from the
Lender,  obtain such additional  insurance as the Lender shall  reasonably
require,  all at the sole expense of the Company.  Copies of such policies
shall be furnished to the Lender without charge upon request of the Lender.

                  6.9 Closing Instructions.  Indemnify  and  hold  the  Lender
harmless from and against any loss, including reasonable  attorneys'  fees and
costs,  attributable  to the  failure of a title insurance  company,  agent or
approved  attorney  to comply with the disbursement or  instruction  letter or
letters of the Company  relating to any Mortgage Loan. The Lender shall have
the right to  pre-approve the closing instructions of the Company to the title
insurance company, agent or attorney in any case where the Mortgage Loan to be
created at settlement is intended to be warehoused by the Company to be
included as Collateral pursuant hereto.

                  6.10 Subordination   of  Certain   Indebtedness.   Cause any
indebtedness of the Company, incurred after the date of this Agreement, to any
shareholder,  director or officer of the  Company,  or to any Affiliate of the
Company  or of  any  Subsidiary  of  the  Company,  to be  subordinated to all
Obligations by the execution of a Subordination of Debt  Agreement in the form
of Exhibit F hereto  and  deliver  to  the  Lender  an  executed  copy of said
Agreement, certified by the corporate  secretary of the Company to be true and
complete and in full force and effect.

                  6.11 Other Loan Obligations. Perform all material
obligations under the terms of each loan agreement, note, mortgage,  security
agreement or debt instrument by which the Company is bound or to which any of
its property is subject,  and promptly notify the Lender in writing of a
declared default under or the termination, cancellation, reduction or
nonrenewal of any of its other lines of credit or agreements with any other
lender.  Exhibit J hereto is a true and  complete  list of all such  lines of
credit or  agreements  as of the date hereof and the Company  hereby agrees to
give the Lender at least 30 days Notice before entering into any additional
lines of credit or agreements.

                  6.12 Use of Proceeds of Advances.  Use the  proceeds of each
Advance solely for the purpose set forth in Section 2.1(b) for Advances of
that type.

<PAGE> 79

                  6.13 Special Affirmative Covenants Concerning Collateral.

       6.13(a)  Warrant and defend the right,  title and interest of the
  Lender in and to the Collateral  against the claims and demands of all
  Persons whomsoever.

       6.13(b)  Service or cause to be  serviced  all  Mortgage
  Loans in  accordance  with the  standard  requirements  of the
  issuers  of  Purchase  Commitments  covering  the same and all
  applicable FHA, FmHA and VA  requirements,  including  without
  limitation   taking  all  actions  necessary  to  enforce  the
  obligations  of the obligors  under such Mortgage  Loans.  The
  Company  shall  service or cause to be serviced  all  Mortgage
  Loans backing Pledged Securities in accordance with applicable
  governmental  requirements  and  requirements  of  issuers  of
  Purchase Commitments covering the same. The Company shall hold
  all escrow funds collected in respect of Pledged Mortgages and
  Mortgage Loans backing  Pledged  Securities in trust,  without
  commingling the same with  non-custodial  funds, and apply the
  same for the purposes for which such funds were collected.

       6.13(c)  Execute and deliver to the Lender such  Uniform
  Commercial  Code  financing  statements  with  respect  to the
  Collateral  as the Lender may request.  The Company shall also
  execute and deliver to the Lender such further  instruments of
  sale,  pledge or  assignment  or transfer,  and such powers of
  attorney,  as required by the Lender, and shall do and perform
  all matters and things  necessary  or  desirable to be done or
  observed, for the purpose of effectively creating, maintaining
  and  preserving  the  security  and  benefits  intended  to be
  afforded  the Lender  under this  Agreement.  The Lender shall
  have all the rights and remedies of a secured  party under the
  Uniform Commercial Code of Minnesota,  or any other applicable
  law, in addition to all rights provided for herein.

       6.13(d)  Notify the Lender within (i) 2 Business Days of
  any default  under,  or of the  termination  of, any  Purchase
  Commitment relating to any Pledged Mortgage, Eligible Mortgage
  Pool or Pledged  Security  (ii) 2 Business Days of any default
  (after  expiration of any grace  period) under any  Unimproved
  Mortgage Loan.

       6.13(e)  Promptly  comply in all respects with the terms
  and   conditions   of  all  Purchase   Commitments,   and  all
  extensions,   renewals  and   modifications  or  substitutions
  thereof or thereto.  The Company will cause to be delivered to
  the Investor the Pledged  Mortgages and Pledged  Securities to
  be sold  under  each  Purchase  Commitment  not  later  than 3
  Business Days prior to the mandatory delivery date thereof.

<PAGE> 80

       6.13(f)  Maintain,  at  its  principal  office  or  in a
  regional office approved by the Lender,  or in the office of a
  computer service bureau engaged by the Company and approved by
  the Lender,  and, upon request,  make  available to the Lender
  the originals,  or copies in any case where the originals have
  been  delivered  to  the  Lender  or to an  Investor,  of  its
  Mortgage  Notes and Mortgages  included in Pledged  Mortgages,
  Mortgage-backed  Securities delivered to the Lender as Pledged
  Securities,  Purchase  Commitments,  and all related  Mortgage
  Loan  documents  and  instruments,  and  all  files,  surveys,
  certificates,  correspondence,  appraisals, computer programs,
  tapes, discs, cards,  accounting records and other information
  and data relating to the Collateral.

                  6.14     Special Affirmative Covenants Concerning
Construction Advances.

       6.14(a) Use the  proceeds of each  Construction  Advance
  solely  for  the  purposes  of  funding   Total  Costs  for  a
  Construction/Perm Mortgage Loan.

       6.14(b)  Notify the Lender within 2 Business Days of the
  following   events:   (1)  upon   knowledge  of  the  Company,
  construction ceasing for more than 15 days on the improvements
  to the premises  encumbered by a Pledged Mortgage,  (2) a lien
  filed against  premises  encumbered by a Pledged  Mortgage and
  not removed  within 15 days of the filing,  and (3) any damage
  or  destruction  of  the  premises  encumbered  by  a  Pledged
  Mortgage.

7.  NEGATIVE COVENANTS.

                  The Company hereby covenants and agrees that, so long as the
Commitment is outstanding  or  there  remain  any  Obligations  to be  paid or
performed,  the Company shall not, either directly or indirectly,  without the
prior written consent of the Lender:

                  7.1 Contingent Liabilities.  Assume, guarantee,  endorse, or
otherwise become contingently liable for the obligation of any Person except
by endorsement of negotiable instruments for deposit or collection in the
ordinary course of business and except for  obligations  resulting form
representations, warranties and covenants customarily made in connection with
non-recourse sales of Mortgage Loans.

                  7.2 Sale or Pledge of Servicing Contracts.  Sell, pledge or
grant a security interest in any existing or future Servicing Contracts of the
Company other than to the Lender, except as otherwise  expressly  permitted in
this Agreement, or omit to take any action required to keep all such Servicing
Contracts in full force and effect; provided,  however,  that if no Default or
Event of Default has occurred and is continuing, servicing on individual

<PAGE> 81

Mortgage Loans may be sold  concurrently  with and incidental to the sale of
such Mortgage Loans (with servicing  released) in the ordinary course of
the Company's business.

                  7.3 Merger; Sale of Assets; Acquisitions. Liquidate,
dissolve, consolidate or merge or sell any substantial part of its assets, or
acquire any substantial part of the assets of another,  except the sale of
Mortgage Loans in the ordinary course of business.

                  7.4 Deferral of Subordinated  Debt.  Pay in  advance of the
stated maturity thereof any Subordinated Debt of the Company or, if a Default
or Event of Default hereunder shall have occurred,  make any payment of any
kind thereafter on such  Subordinated  Debt until all Obligations  have been
paid and performed in full and any applicable preference period has expired.

                  7.5 Loss of Eligibility. Take any action that would cause
the Company to lose all or any part of its  status  as an  eligible  lender,
seller/servicer and issuer as described under Section 5.13 hereof.

                  7.6 Debt  to  Tangible Net Worth Ratio. Permit the ratio of
Debt  (excluding,   for  this  purpose  only,  Debt arising under the Hedging
Arrangements, to  the  extent  of assets  arising  under  the  same   Hedging
Arrangements) to Tangible Net Worth of the Company (and its Subsidiaries,  on
a consolidated basis) at any time to exceed 10 to 1.

                  7.7 Minimum Tangible Net Worth. Permit Tangible Net Worth of
the Company (and its  Subsidiaries, on a consolidated basis) at any time to be
less than $6,000,000.

                  7.8 Acquisition of Recourse  Servicing  Contracts.  Acquire
Servicing Contracts under which the Company is  obligated  to  repurchase  or
indemnify  the  holder of the  Mortgage Loans as a result of  defaults on the
Mortgage Loans at any time during the term of such Mortgage Loans.

                  7.9 Gestation Facilities.  Directly or indirectly sell or
finance Pledged Mortgages under any Gestation Agreements.

                  7.10 Special Negative Covenants Concerning Collateral.

       7.10(a) The Company shall not amend or modify,  or waive
  any of the terms and  conditions  of, or settle or  compromise
  any claim in respect  of,  any  Pledged  Mortgages  or Pledged
  Securities.

       7.10(b) The Company shall not sell, assign,  transfer or
  otherwise  dispose of, or grant any option with respect to, or
  pledge  or  otherwise   encumber   (except  pursuant  to  this
  Agreement or as permitted herein) any of the Collateral or any
  interest therein.

<PAGE> 82

        7.10(c)  The  Company  shall  not make  any  compromise,
  adjustment or  settlement in respect of any of the  Collateral
  or accept  other than cash in payment  or  liquidation  of the
  Collateral.

8.       DEFAULTS; REMEDIES.

                  8.1 Events of Default.  The occurrence of any of the
following conditions or events shall be an event of default ("Event of
Default"):

       8.1(a) Failure to pay the principal of any Advance when
  due,  whether at stated maturity,  by  acceleration,  or
  otherwise; or failure to pay any installment of interest
  on any  Advance  or any  other  amount  due  under  this
  Agreement  within 10 days after the due date; or failure
  to pay,  within any applicable  grace period,  any other
  Obligations of the Company due the Lender; or

       8.1(b) Failure of the Company or any of its Subsidiaries
  to pay, or any  default in the payment of any  principal
  or  interest  on,  any other  indebtedness  in excess of
  $250,000 or in the payment of any contingent  obligation
  within any  period of grace  provided  and such  default
  shall not be waived or cured unless the Company shall be
  diligently  contesting such obligation in good faith and
  such  contesting  shall not  impair or affect any of the
  Collateral  or the  Lender's  security  interest  in the
  Collateral;  or breach or  default  with  respect to any
  other material term of any other  indebtedness or of any
  loan agreement,  mortgage,  indenture or other agreement
  relating  thereto,  if the  effect  of  such  breach  or
  default is to cause,  or to permit the holder or holders
  thereof  (or a  trustee  on  behalf  of such  holder  or
  holders)  to cause,  indebtedness  of the Company or its
  Subsidiaries in the aggregate  amount of $50,000 or more
  to  become  or be  declared  due  prior  to  its  stated
  maturity (upon the giving or receiving of notice,  lapse
  of time, both, or otherwise); or

       8.1(c)  Failure of the Company to perform or comply with
   any term or  condition  applicable  to it  contained  in
   Sections 6.3, 6.12 and 6.13 or in any Section of Article
   7 of this Agreement; or

<PAGE> 83

       8.1(d)   Any of the Company's  representations   or
  warranties  made or deemed  made  herein or in any other
  Loan  Document  (other  than  the   representations  and
  warranties set forth in Section 5.15 hereof),  or in any
  statement  or  certificate  at  any  time  given  by the
  Company in writing  pursuant  hereto or thereto shall be
  inaccurate or incomplete in any material  respect on the
  date as of which made or deemed made; or

       8.1(e) The Company shall default in the performance of
  or compliance  with any term contained in this Agreement
  or any other Loan Document  other than those referred to
  above in Subsections 8.1(a),  8.1(c) or 8.1 (d) and such
  default shall not have been remedied or waived within 30
  days after the earliest of (i) receipt by the Company of
  Notice from the Lender of such default,  (ii) receipt by
  the Lender of Notice from the  Company of such  default,
  or (iii) the date the Company  should have  notified the
  Lender of such default pursuant to Section 6.6(c); or

       8.1(f) (1) A court  having  jurisdiction  shall  enter a
  decree or order for relief in respect of the  Company or
  any  Subsidiary  of the Company in an  involuntary  case
  under any  applicable  bankruptcy,  insolvency  or other
  similar law in respect of the Company or any  Subsidiary
  of the Company now or hereafter in effect,  which decree
  or order is not stayed; the Company or any Subsidiary of
  the  Company  shall  consent  to the  entry  of any such
  decree or order;  or a filing of a voluntary  case under
  any applicable  bankruptcy,  insolvency or other similar
  law in respect of the Company or any  Subsidiary  of the
  Company has occurred;  or any other similar relief shall
  be granted under any applicable federal or state law; or
  (2) the filing of an involuntary  case in respect of the
  Company  or any  Subsidiary  of the  Company  under  any
  applicable bankruptcy,  insolvency or other similar law;
  or a decree or order of a court having  jurisdiction for
  the appointment of a receiver, liquidator, sequestrator,
  trustee,  custodian  or  other  officer  having  similar
  powers  over  the  Company  or  any  Subsidiary  of  the
  Company,  or over  all or a  substantial  part of  their
  respective  property,  shall have been  entered;  or the
  involuntary  appointment  of  an  interim  or  permanent
  receiver,  trustee or other  custodian of the Company or
  any  Subsidiary  of the Company for all or a substantial
  part of their respective property;  or the issuance of a
  warrant of attachment, execution or similar process

<PAGE> 84

  against any substantial  part of the property of
  the Company or any  Subsidiary  of the Company,  and the
  continuance  of any such events in Subsection  (2) above
  for 60 days unless dismissed,  bonded off or discharged;
  or

       8.1(g) The Company,  any Subsidiary of the Company shall
  consent to the appointment of or taking  possession by a
  receiver,  trustee  or  other  custodian  for  all  or a
  substantial  part of its  property;  the  making  by the
  Company,  any Subsidiary of the Company or the Parent of
  any  assignment  for the  benefit of  creditors;  or the
  inability or failure of the Company,  any  Subsidiary of
  the  Company  or the  Parent,  or the  admission  by the
  Company, any Subsidiary of the Company in writing of its
  inability, to pay its debts as such debts become due; or

       8.1(h) Failure of the Company to perform any contractual
  obligations  which  it may have to  repurchase  Mortgage
  Loans,  if  such  obligations  in the  aggregate  exceed
  $1,000,000; or

       8.1(i) Any money  judgment,  writ  or   warrant  of
  attachment,  or similar process involving in any case an
  amount in excess of  $250,000  shall be entered or filed
  against the Company or any of its Subsidiaries or any of
  their respective  assets and shall remain  undischarged,
  unvacated,  unbonded or unstayed for a period of 30 days
  or in any event  later  than 5 days prior to the date of
  any proposed sale thereunder; or

       8.1(j) Any order,  judgment  or decree  shall be entered
  against the Company  decreeing the  dissolution or split
  up  of  the  Company   and  such  order   shall   remain
  undischarged  or  unstayed  for a period in excess of 20
  days; or

       8.1(k) Any Plan  maintained by the Company or any of its
  Subsidiaries  shall be terminated  within the meaning of
  Title IV of ERISA or a trustee  shall be appointed by an
  appropriate  United States  District Court to administer
  any Plan, or the Pension  Benefit  Guaranty  Corporation
  (or any successor  thereto) shall institute  proceedings
  to  terminate  any  Plan  or to  appoint  a  trustee  to
  administer  any  Plan  if as of  the  date  thereof  the
  Company's  liability or any such Subsidiary's  liability
  (after giving effect to the tax consequences thereof) to
  the  Pension  Benefit   Guaranty   Corporation  (or  any
  successor   thereto)  for  unfunded   guaranteed  vested
  benefits under the Plan exceeds the the current value of

<PAGE> 85

  assets  accumulated in such  Plan by more  than  $25,000
  (or in the  case of a termination involving  the Company
  or  any of its Subsidiaries as a "substantial  employer"
  (as defined in Section 4001(a)(2) of ERISA) the
  withdrawing  employer's proportionate  share of such
  excess  shall  exceed such amount); or

       8.1(l)  The  Company  or  any  of  its  Subsidiaries  as
  employer  under a  Multiemployer  Plan shall have made a
  complete or partial  withdrawal from such  Multiemployer
  Plan and the plan  sponsor  of such  Multiemployer  Plan
  shall have notified such withdrawing  employer that such
  employer  has  incurred  a  withdrawal  liability  in an
  annual amount exceeding $25,000; or

       8.1(m)  The  Company   shall   purport  to  disavow  its
  obligations  hereunder or shall  contest the validity or
  enforceability hereof; or the Lender's security interest
  on  any   portion  of  the   Collateral   shall   become
  unenforceable  or  otherwise  impaired;  provided  that,
  subject to the  Lender's  approval,  no Event of Default
  shall  occur  as a  result  of  such  impairment  if all
  Advances made against any such Collateral  shall be paid
  in full  within 10 days of the date of such  impairment;
  or

       8.1(n)  The  Parent  shall  cease  owning,  directly  or
  indirectly, all of the capital stock of the Company; or

       8.1(o)  Any Lien  for any  taxes,  assessments  or other
  governmental charges (i) is filed against the Company or
  any of its property,  or is otherwise  enforced  against
  the  Company  or any of its  property,  or (ii)  obtains
  priority  that is equal or greater  than the priority of
  the Lender's security interest in any of the Collateral,
  if the  aggregate  amount of unpaid taxes related to all
  such tax Liens exceeds $100,000; or

       8.1(p) A material  adverse change occurs in the business
  condition   (financial   or   otherwise),    operations,
  properties  or  prospects  of  the  Company,  or in  the
  ability of the Company to repay the Obligations.

<PAGE> 86

                  8.2   Remedies.

       8.2(a)  Upon the  occurrence  of any  Event  of  Default
  described in Sections  8.1(f) or 8.1(g),  the Commitment
  shall be terminated and the unpaid  principal  amount of
  and   accrued   interest  on  the  Note  and  all  other
  Obligations shall automatically  become due and payable,
  without presentment, demand or other requirements of any
  kind,  all of which are hereby  expressly  waived by the
  Company.

       8.2(b)  Upon the  occurrence  of any  Event of  Default,
  other  than  those  described  in  Sections  8.1(f)  and
  8.1(g),  the  Lender  may,  by  Notice  to the  Company,
  terminate the Commitment  and/or declare all Obligations
  to be  immediately  due and payable,  whereupon the same
  shall  forthwith  become due and payable,  together with
  all accrued interest thereon,  and the obligation of the
  Lender to make any Advances shall thereupon terminate.

       8.2(c) Upon the occurrence of any Event of Default,
  the  Lender may also do any of the following:

           (1)  Foreclose  upon or  otherwise  enforce its
           security interest in and Lien on the Collateral
           to secure all payments and  performance  of the
           Obligations  in any manner  permitted by law or
           provided for hereunder.

           (2)   Notify   all   obligors   in  respect  of
           Collateral   that  the   Collateral   has  been
           assigned  to the Lender  and that all  payments
           thereon  are to be made  directly to the Lender
           or such other party as may be designated by the
           Lender;  settle,  compromise,  or  release,  in
           whole  or in  part,  any  amounts  owing on the
           Collateral, any such obligor or any Investor or
           any  portion  of  the   Collateral,   on  terms
           acceptable to the Lender;  enforce  payment and
           prosecute any action or proceeding with respect
           to any and all  Collateral;  and where any such
           Collateral  is in  default,  foreclose  on  and
           enforce  security  interests in such Collateral
           by any available  judicial procedure or without
           judicial process and sell property  acquired as
           a result of any such foreclosure.

<PAGE> 87

           (3) Act, or contract with a third party to act,
           as  servicer  or  subservicer  of each  item of
           Collateral  requiring servicing and perform all
           obligations   required   in   connection   with
           Servicing  Contracts and Purchase  Commitments,
           such  third  party's  fees  to be  paid  by the
           Company.

          (4)  Require   the  Company  to  assemble   the
          Collateral  and/or  books and records  relating
          thereto and make such  available  to the Lender
          at a place to be designated by the Lender.

          (5) Enter onto property where any Collateral or
          books and records  relating thereto are located
          and take  possession  thereof  with or  without
          judicial  process;  and  obtain  access  to the
          Company's data processing  equipment,  computer
          hardware   and   software   relating   to   the
          Collateral  and to use all of the foregoing and
          the information contained therein in any manner
          the Lender deems  necessary  for the purpose of
          effectuating  its rights  under this  Agreement
          and any other Loan Document.

          (6) Prior to the disposition of the Collateral,
          prepare it for disposition in any manner and to
          the extent the Lender deems appropriate.

          (7)  Exercise  all  rights  and  remedies  of a
          secured  creditor under the Uniform  Commercial
          Code of  Minnesota  or  other  applicable  law,
          including,  but  not  limited  to,  selling  or
          otherwise  disposing of the Collateral,  or any
          part thereof,  at one or more public or private
          sales,   whether  or  not  such  Collateral  is
          present  at the  place  of  sale,  for  cash or
          credit or future delivery, on such terms and in
          which manner  as  the  Lender  may   determine,
          including, without limitation, sale pursuant to
          any applicable Purchase  Commitment.  If notice
          is  required  under such  applicable  law,  the
          Lender  will give the  Company not less than 10
          days'  notice of any such public sale or of the
          date after which any private  sale may be held.
          The Company  agrees that 10 days'  notice shall
          be reasonable  notice.  The Lender may, without
          notice or publication, adjourn any public or

<PAGE> 88

          private  sale or cause the same to be adjourned
          from time to time by  announcement  at the time
          and place fixed for the sale, and such sale may
          be made at any time or place to which  the same
          may be so adjourned. In case of any sale of all
          or any part of the  Collateral on credit or for
          future delivery,  the Collateral so sold may be
          retained by the Lender until the selling  price
          is  paid  by the  purchaser  thereof,  but  the
          Lender shall not incur any liability in case of
          the  failure of such  purchaser  to take up and
          pay for the  Collateral so sold and, in case of
          any such failure,  such Collateral may again be
          sold upon like notice. The Lender may, however,
          instead of exercising  the power of sale herein
          conferred  upon it,  proceed by a suit or suits
          at law or in equity to collect  all amounts due
          upon the  Collateral or to foreclose the pledge
          of and  sell  the  Collateral  or  any  portion
          thereof  under a judgment  or decree of a court
          or courts of competent jurisdiction, or both.

          (8) Proceed against the Company on the Note.

          (9) Make additiona  Construction Advances to be
          added  to  the   Obligations  of  the  Company,
          without  the  request of the  Company,  for the
          purposes of completing the  improvements  to be
          funded  by a  Construction/Perm  Mortgage  Loan
          pledged  hereunder  and  employ  inspectors  to
          provide inspection reports at the sole cost and
          expense of the Company.

       8.2(d) The Lender  shall incur no  liability as a result
  of the sale or other  disposition of the Collateral,  or
  any part  thereof,  at any  public  or  private  sale or
  disposition.  The Company  hereby  waives (to the extent
  permitted  by law) any  claims it may have  against  the
  Lender  arising  by reason of the fact that the price at
  which the  Collateral may have been sold at such private
  sale was less  than the  price  which  might  have  been
  obtained at a public sale or was less than the aggregate
  amount  of  the  outstanding  Advances  and  the  unpaid
  interest accrued thereon, even if the Lender accepts the
  first offer  received and does not offer the  Collateral
  to  more  than  one  offeree.  Any  sale  of  Collateral
  pursuant to the terms of a Purchase Commitment, or any

<PAGE> 89

  other disposition of Collateral arranged by the Company,
  whether before or after the  occurrence  of an Event of
  Default, shall be deemed to have been made in a commercially
  reasonable manner.

       8.2(e) The Company  acknowledges that Mortgage Loans and
  Mortgage-backed  Securities  are  collateral  of a  type
  which is customarily  sold on a recognized  market.  The
  Company  waives any right it may have to prior notice of
  the sale of any Pledged  Mortgage  or Pledged  Security,
  and  agrees  that the Lender may  purchase  any  Pledged
  mortgages  or Pledged  Securities  at a private  sale of
  such Collateral.

        8.2(f) The Company specifically waives and releases
  (to the extent permitted  by law) any equity or right of
  redemption, all rights of redemption,  stay or appraisal
  which the  Company has or may have under any rule of law
  or statute now  existing or hereafter  adopted,  and any
  right to require the Lender to (1)  proceed  against any
  Person,  (2)  proceed  against  or  exhaust  any  of the
  Collateral  or pursue its rights and remedies as against
  the  Collateral in any particular  order,  or (3) pursue
  any other  remedy in its power.  The Lender shall not be
  required to take any steps  necessary  to  preserve  any
  rights of the Company against holders of mortgages prior
  in lien  to the  Lien of any  Mortgage  included  in the
   Collateral or to preserve rights against prior parties.

        8.2(g) The Lender may, but shall not be obligated to,
  advance  any  sums or do any act or thing  necessary  to
  uphold  and  enforce  the Lien and  priority  of, or the
  security  intended  to  be  afforded  by,  any  Mortgage
  included   in   the   Collateral,   including,   without
  limitation,  payment of delinquent  taxes or assessments
  and insurance premiums. All advances, charges, costs and
  expenses,   including  reasonable  attorneys'  fees  and
  disbursements,   incurred  or  paid  by  the  Lender  in
  exercising any right,  power or remedy conferred by this
  Agreement,  or in the enforcement hereof,  together with
  interest thereon,  at the Default Rate, from the time of
  payment  until  repaid,  shall  become  a  part  of  the
  principal  balance  outstanding  hereunder and under the
  Note.

<PAGE> 90

        8.2(h) No failure on the part of the Lender to exercise,
  and no delay in exercising,  any right,  power or remedy
  provided hereunder, at law or in equity shall operate as
  a waiver  thereof;  nor  shall  any  single  or  partial
  exercise  by the  Lender of any  right,  power or remedy
  provided  hereunder,  at law or in equity  preclude  any
  other or further exercise thereof or the exercise of any
  other right, power or remedy. Without intending to limit
  the  foregoing,  all  defenses  based on the  statute of
  limitations  are  hereby  waived by the  Company  to the
  intent  permitted by law. The remedies  herein  provided
  are  cumulative  and are not  exclusive  of any remedies
  provided at law or in equity.

        8.2(i) The Lender is hereby granted a license or other
  right  to  use,  upon  the  occurrence  of an  Event  of
  Default,   without   charge,   the  Company's   computer
  programs, other programs, labels, copyrights,  rights of
  use  of  any  name,   Investor   lists,   trade   names,
  trademarks, service marks and advertising matter, or any
  property  of a similar  nature,  as it  pertains  to the
  Collateral,  in  advertising  for sale and  selling  any
  Collateral,  and the Company's rights under all licenses
  and all other agreements  related to the foregoing shall
  inure to the Lender's  benefit until the Obligations are
  paid in full.

                  8.3 Application of Proceeds.  The  proceeds  of  any  sale,
disposition or other enforcement of the Lender's security interest in all or
any part of the Collateral shall be applied by the Lender to the Obligations
in such order as the Lender, in its sole and absolute discretion,  shall
determine. From and after the indefensible payment to the Lender of all of the
Obligations,  any remaining  proceeds  shall  be  paid to the  Company,  or to
its successors or assigns, or as a court of competent jurisdiction may direct,
of any surplus then remaining from such proceeds.

                  If   the   proceeds   of   any  sale, disposition  or other
enforcement are insufficient to cover the costs and expenses of the sale, and
the  payment  in  full of all Obligations, the Company will remain liable for
any deficiency.

                  8.4 Lender Appointed Attorney-in-Fact.  The Lender is hereby
appointed the attorney-in-fact of the Company, with full power of substitution,
for the purpose of carrying out the provisions hereof and taking any action and
executing any instruments which the Lender may deem  necessary or advisable to
accomplish  the  purposes hereof, which  appointment  as  attorney-in-fact  is
irrevocable and coupled with an interest. Without limiting the generality of
the foregoing,  the Lender shall have the right and power to give notices of
its security  interest in the  Collateral  to any Person,  either in the name
of the Company or in its own name, to endorse all Pledged Mortgages or Pledged

<PAGE> 91

Securities payable to the order of the Company, to change or cause to be
changed the book-entry registration or name of subscriber or Investor on any
Pledged Security,  or to receive,  endorse  and  collect all checks made
payable to the order of the Company  representing any payment on account of
the principal of or interest on, or the proceeds of sale of, any of the
Pledged Mortgages or Pledged Securities and to give full discharge for the
same.

                  8.5 Right of Set-Off.  If the  Company shall  default in the
payment of the Note, any interest accrued  thereon, or any other sums which
may become  payable  hereunder when due, or in the  performance of any of its
other obligations  or  liabilities  under this  Agreement,  the Lender  shall
have the right, at any time and from time to time, without notice, to set-off
and to appropriate  or apply any and all property or indebtedness of any kind
at any time held or owing by the  Lender to or for the credit or the  account
of the Company  against and on account of the Obligations of the Company under
the Note and this  Agreement,  irrespective of whether or not the Lender shall
have made any demand hereunder and whether or not said Obligations shall have
matured.

9.       NOTICES.

                  All  notices,  demands,   consents,   requests   and   other
communications   required   or permitted   to  be  given  or  made   hereunder
(collectively,   "Notices")  shall, except  as  otherwise  expressly  provided
hereunder,  be in writing  and shall be delivered in person or  telecopied  or
mailed, first class or delivered by overnight courier, return receipt
requested, postage prepaid,  addressed to the respective parties hereto at
their respective addresses  hereinafter set forth or, as to any such party, at
such other address as may be  designated  by it in a Notice  to the  other.
All  Notices  shall be conclusively deemed to have been properly given or made
when duly delivered,  in person,  by  telecopy  or by  overnight  courier,  or
if mailed,  on the date of receipt as noted on the return receipt, addressed
as follows:

                  if to the Company:        U.S. Home Mortgage Corporation
                                            311 Park Place Boulevard
                                            P. O. Box 4929
                                            Clearwater, Florida 33759
                                            Attention: Virginia Casagrande,
                                            Vice President/Controller
                                            Telecopier No.: (727) 791-3409

                  if to the Lender:         Residential Funding Corporation
                                            4800 Montgomery Lane, Suite 300
                                            Bethesda, Maryland 20814
                                            Attention: Jim Clapp, Director
                                            Telecopier No.: (301) 215-6288

<PAGE> 92

10.      REIMBURSEMENT OF EXPENSES; INDEMNITY.

         The Company shall:(a) pay a documentation production fee of $1,000 in
connection with the preparation and negotiation of this Agreement;  (b) pay an
Extension Fee of $24,000 in connection with the extension of the Maturity Date
pursuant to this  Agreement; (c) pay such additional documentation  production
fees as the Lender may require and all out-of-pocket costs and expenses of the
Lender,  including,  without  limitation, reasonable fees, service charges and
disbursements of counsel  (including  allocated costs of internal counsel), in
connection with the amendment, enforcement and administration of this
Agreement, the Note,  and other Loan Documents and the making and repayment of
the Advances and the payment of interest thereon; (d) indemnify, pay, and hold
harmless the Lender  and any holder of the Note from and against, any and all
present  and future stamp,  documentary and other similar taxes with respect
to the foregoing matters and save the Lender and the holder or holders of the
Note  harmless from and against any and all liabilities  with respect to or
resulting from any delay or omission to pay such taxes;  and (e)  indemnify ,
pay and hold  harmless  the Lender  and  any of  its  officers,  directors,
employees  or  agents  and  any subsequent holder of the Note (collectively
called the "Indemnitees")  from and against  any and  all  liabilities,
obligations,  losses,  damages,  penalties, judgments, suits, costs, expenses
and  disbursements  of any kind or  nature whatsoever (including without
limitation,  the reasonable fees and disbursements of counsel of the
Indemnitees (including allocated costs of internal counsel) in connection
with  any  investigative,  administrative  or  judicial  proceeding, whether
or not such  Indemnitees  shall be designated a party thereto) which may
be imposed upon, incurred by or asserted against such Indemnitees in any
manner relating  to or  arising  out of this  Agreement,  the Note,  or any
other  Loan Document  or  any  of the  transactions  contemplated  hereby  or
thereby  (the "Indemnified  Liabilities"); provided, however, that the Company
shall have no obligation  hereunder with respect to Indemnified  Liabilities
arising from the gross negligence or willful misconduct of any such
Indemnitees.  To the extent that the  undertaking  to  indemnify,  pay and
hold harmless as set forth in the preceding  sentence may be  unenforceable
because it is violative of any law or public  policy,  the Company shall
contribute  the maximum  portion which it is permitted  to  pay  and  satisfy
under  applicable  law,  to  the  payment  and satisfaction of all Indemnified
Liabilities  incurred by the Indemnitees or any of them.  The agreement of the
Company  contained in this  Subsection  (e) shall survive the  expiration or
termination of this Agreement and the payment in full of the Note.  Attorneys'
fees and  disbursements  incurred in enforcing,  or on appeal from, a judgment
pursuant hereto shall be recoverable separately from and in addition to any
other amount  included in such  judgment,  and this clause is intended to be
severable  from the other  provisions  of this  Agreement  and to survive and
not be merged into such judgment.

<PAGE> 93

11.      FINANCIAL INFORMATION.

                  All financial statements and reports furnished to the Lender
hereunder  shall  be  prepared  in  accordance with GAAP,  applied  on a basis
consistent with that applied in preparing the financial statements as at the
end of and for the last fiscal year ended (except to the extent  otherwise
required to conform to good accounting practice).

12.      MISCELLANEOUS.

                  12.1   Terms  Binding   Upon    Successors;    Survival   of
Representations.  The terms and provisions of this  Agreement shall be binding
upon and inure to the benefit of the parties  hereto and their respective
successors and assigns.  All  representations,  warranties, covenants and
agreements  herein  contained on the part of the Company shall survive the
making of any Advance and the execution of the Note, and shall be effective so
long as the  Commitment  is  outstanding  or there remain any Obligations to
be paid or performed.

                  12.2  Assignment. This Agreement  cannot be  assigned by the
Company.  This Agreement and the Note, along with the Lender's security
interest  in  any  or  all of the Collateral, may, at any time, be transferred
or assigned, in whole or in part, by the Lender,  and any assignee thereof may
enforce this Agreement,  the Note and its security interest in the Collateral
so assigned.

                  12.3  Amendments.  Except  as  otherwise   provided  in  this
Agreement,  this Agreement may not be amended, modified or supplemented unless
such  amendment,  modification  or  supplement is set forth in a  writing
signed by the parties hereto.

                  12.4  Governing Law.  This  Agreement  and  the  other  Loan
Documents shall be  governed  by the laws of the  State of  Minnesota, without
reference to its principles of conflicts of laws.

                  12.5  Participations. The Lender may at any time sell,
assign or grant participations  in, or otherwise transfer to any other Person
(a "Participant"),  all or part of the Obligations.  Without limitation of the
exclusive  right of the  Lender to  collect  and  enforce  such Obligations,
the Company agrees that each disposition will give rise to a debtor-creditor
relationship of the Company to the Participant,  and the Company  authorizes
each  Participant,  upon the  occurrence of an Event of  Default,  to proceed
directly  by right of setoff,  banker's lien, or  otherwise,  against any
assets of the Company which may be in the hands of such  Participant.  The
Company  authorizes  the Lender to disclose to any prospective Participant
and any Participant any and all information in the Lender's  possession
concerning  the Company,  this  Agreement and the Collateral.

<PAGE> 94

                  12.6 Relationship of the Parties. This Agreement provides
for the making of Advances by the Lender,  in its capacity as a lender,  to
the Company, in its capacity as a  borrower,  and for the payment of interest,
repayment of principal by the Company to the Lender, and for the  payment  of
certain  fees  by  the  Company  to the  Lender.  The relationship  between
the Lender and the Company is limited to that of creditor/secured party, on
the one hand, and debtor, on the other hand. The  provisions  herein for
compliance  with  financial  covenants and delivery of financial statements
are intended solely for the benefit of the Lender to protect its  interests
as lender in assuring  payments of interest and repayment of principal and
payment of certain  fees,  and nothing contained in this Agreement shall be
construed as permitting or obligating  the Lender to act as a  financial or
business advisor or consultant to the Company,  as permitting or obligating
the Lender to control the Company or to conduct the Company's operations, as
creating any fiduciary obligation on the part of the Lender to the Company, or
as creating any joint venture,  agency, or other  relationship  between the
parties hereto other than as explicitly and specifically  stated in this
Agreement.   The  Company   acknowledges  that it has  had  the opportunity
to obtain the advice of experienced counsel of its own choosing in connection
with the  negotiation  and  execution  of this Agreement  and to obtain the
advice of such counsel with respect to all matters contained herein.  The
Company further  acknowledges that it is experienced  with respect to
financial and credit  matters and has made its own independent decisions to
apply to the Lender for credit and to execute and deliver this Agreement.

                  12.7 Severability. If any provision of this Agreement shall
be declared to be illegal or unenforceable in any respect, such illegal or
unenforceable  provision  shall be and become absolutely null and void and of
no force and effect as though  such  provision  were not in fact set forth
herein,  but all other  covenants,  terms,  conditions  and provisions  hereof
shall   nevertheless   continue  to  be  valid  and  enforceable.

                  12.8 Operational Reviews. From time to time upon request,
the Company  shall  permit the Lender or its  representative  access to its
premises  and  records,  for the purpose of  conducting a review of the
Company's general mortgage business methods,  policies, and procedures,
auditing loan files and reviewing  financial and operational aspects of
the Company's business.

                  12.9 Consent to Credit References. The Company hereby
consents to  the disclosure of information regarding  the  Company  and  its
relationships with the Lender to Persons making credit inquiries to the Lender.
This  consent  is  revocable  by the  Company at any time upon Notice to the
Lender as provided in Section 9 hereof.

<PAGE> 95

                  12.10 Consent to Jurisdiction.  The Company hereby agrees
that any action or  proceeding  under the Loan  Documents,  the Note or any
document delivered pursuant hereto may be commenced against it in any court
of  competent  jurisdiction  within  the State of  Minnesota,  by service  of
process  upon the  Company by first  class  registered  or certified mail,
return receipt requested,  addressed to the Company at its address last known
to the Lender.  The Company agrees that any such suit, action or proceeding
arising out of or relating to this Agreement or any other such  document may
be  instituted  in the Hennepin County State District Court or in the United
States  District  Court for the District  of  Minnesota  at the option of the
Lender;  and the Company hereby  waives any objection to the  jurisdiction or
venue of any such court with respect to, or the  convenience of any court as
a forum for, any such suit, action or proceeding.  Nothing herein shall affect
the right of the  Lender to  accomplish  service  of  process  in any other
manner permitted by law or to commence legal proceedings or otherwise proceed
against the Company in any other jurisdiction or court.

                  12.11 Counterparts.  This Agreement  may be  executed in any
number of counterparts,  each of which shall be deemed an original, but  all
such  counterparts shall together  constitute but one and the same instrument.

                  12.12  Entire Agreement. Subject  to  Section  4.1  of  this
Agreement,  as of the Effective Date, this Agreement  amends,  restates  and
supercedes the Existing Agreement in its entirety. To the extent this
Agreement refers to the provisions of the Existing Agreement, they are
incorporated  into this Agreement by reference,  but will not have independent
effect. Any Default or Event of Default under the Existing Agreement  that
occurred  prior to the  Effective  Date will  remain a Default or Event of
Default under this Agreement.  This Agreement,  the Note and the other Loan
Documents  represent the final  agreement among the parties  hereto and
thereto  with  respect to the  subject  matter hereof and thereof, and may not
be contradicted by evidence of prior or contemporaneous oral agreements among
such parties.  There are no oral agreements  among the parties with respect to
the subject matter hereof and thereof.

                  12.13  WAIVER OF JURY TRIAL. THE COMPANY AND THE LENDER
EACH HEREBY (a)  COVENANTS AND AGREES NOT TO ELECT A TRIAL BY JURY OF ANY
ISSUE  TRIABLE  OF RIGHT BY A JURY,  AND (b) FULLY  WAIVES ANY RIGHT TO
TRIAL BY JURY TO THE EXTENT THAT ANY SUCH RIGHT NOW EXISTS OR HEREAFTER
ARISES.  THE LENDER AND THE COMPANY  EACH GIVES THIS WAIVER OF RIGHT TO
JURY TRIAL KNOWINGLY AND VOLUNTARILY.  THIS WAIVER OF RIGHT TO TRIAL BY
JURY IS SEPARATELY GIVEN, KNOWINGLY AND VOLUNTARILY, BY THE COMPANY AND
THE LENDER, AND THIS WAIVER IS INTENDED TO ENCOMPASS  INDIVIDUALLY EACH
INSTANCE  AND EACH  ISSUE FOR WHICH  THE  RIGHT OF A JURY  TRIAL  WOULD

<PAGE> 96

OTHERWISE ACCRUE. THE LENDER AND THE COMPANY ARE EACH HEREBY AUTHORIZED
AND REQUESTED TO SUBMIT THIS AGREEMENT TO ANY COURT HAVING JURISDICTION
OVER THE SUBJECT MATTER AND THE PARTIES HERETO, SO AS TO SERVE AS CONCLUSIVE
EVIDENCE  OF THIS  WAIVER  OF THE  RIGHT TO JURY  TRIAL.  FURTHER,  THE
COMPANY AND THE LENDER EACH HEREBY CERTIFIES THAT NO  REPRESENTATIVE OR
AGENT OF THE OTHER PARTY,  INCLUDING  THE OTHER  PARTY'S  COUNSEL,  HAS
REPRESENTED,  EXPRESSLY OR OTHERWISE,  TO ANY OF ITS REPRESENTATIVES OR
AGENTS  THAT THE OTHER  PARTY WILL NOT SEEK TO ENFORCE  THIS  WAIVER OF
RIGHT TO JURY TRIAL PROVISION.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the date first above written.

                         U.S. HOME MORTGAGE CORPORATION,

                         a Florida corporation

                         By:
                         Its:

                         RESIDENTIAL FUNDING CORPORATION,

                         a Delaware corporation

                         By:
                         Its:  Director

STATE OF _______________ )

                         ) ss

COUNTY OF ______________ )

         On           , 1999 before me, a Notary Public,  personally  appeared
                        , the           of U.S. HOME MORTGAGE  CORPORATION,  a

Florida  corporation,  personally  known to me (or  proved to me on the basis of
satisfactory  evidence) to be the person whose name is  subscribed to the within
instrument  and  acknowledged  to me that  he/she  executed  the same in his/her
authorized capacity, and that by his/her signature on the instrument the person,
or the entity upon behalf of which the person acted, executed the instrument.

         WITNESS my hand and official seal.

                                    Notary Public

  (SEAL)                            My Commission Expires:

<PAGE> 97

STATE OF _______________ )

                        ) ss

COUNTY OF ______________ )

         On , 1999  before  me,  a  Notary  Public,  personally  appeared  , the
Director of RESIDENTIAL FUNDING CORPORATION, a Delaware corporation,  personally
known to me (or proved to me on the basis of  satisfactory  evidence)  to be the
person whose name is subscribed to the within  instrument and acknowledged to me
that  he/she  executed  the same in  his/her  authorized  capacity,  and that by
his/her  signature on the  instrument  the person,  or the entity upon behalf of
which the person acted, executed the instrument.

         WITNESS my hand and official seal.

                                           Notary Public

 (SEAL)                                    My Commission Expires:

<PAGE> 98

                                                                  EXHIBIT A

                                 PROMISSORY NOTE

$80,000,000                                            Date:  October 1, 1999

        FOR VALUE RECEIVED, the undersigned, U.S. HOME MORTGAGE CORPORATION, a
Florida corporation, (herein called the "Company"),  hereby promises to pay to
the order of  RESIDENTIAL FUNDING CORPORATION,  a  Delaware  corporation  (the
"Lender" or,  together with its successors and assigns,  the  "Holder")  whose
principal  place  of  business  is 8400 Normandale  Lake  Blvd.,   Suite  600,
Minneapolis, Minnesota 55437, or at such other place as the Holder may designate
from time to time, the principal sum of $80,000,000) or so much thereof as may
be  outstanding  from time to time pursuant to the Second Amended and Restated
Warehousing Credit and Security Agreement described below, and to pay interest
on said principal sum or such part thereof as shall remain unpaid from time to
time, from the date of each Advance until repaid in full, and all other fees
and charges due under the Agreement,  at the rates and at the times set forth
in the Agreement.  All payments  hereunder  shall be made in lawful money of
the United States and in immediately available funds.

         This Note is given to evidence an actual warehouse  line of credit in
the above amount and is the Note referred to in that certain Second Amended
and Restated Warehousing Credit and Security Agreement (the "Agreement") dated
the date hereof between the Company and the Lender, as the same may be amended
or supplemented from time to time,  and is entitled to the  benefits  thereof.
Reference  is hereby  made to the  Agreement  (which is incorporated herein by
reference  as fully and with the same effect as if set forth herein at length)
for  a  description  of  the  Collateral,  a  statement of  the covenants  and
agreements,  a statement  of the rights and remedies and  securities  afforded
thereby and other  matters  contained therein.  Capitalized terms used herein,
unless  otherwise defined herein,  shall have the  meanings  given them in the
Agreement.

         This Note is given in replacement for, and not in satisfaction of,
that certain Fourth Amended and Restated Warehousing  Promissory Note dated
March 10, 1998 (the  "Existing  Note")  and is  issued  by the  Company  to
evidence  its Obligations  under the  Agreement.  All amounts  owed by the
Company  under the Existing Note (including,  without limitation,  the unpaid
principal thereunder, interest  accrued  thereon and fees accrued under the
Agreement,  whether or not yet due and owing) as of the date hereof, shall be
owed hereunder.

         This Note may be prepaid  in  whole  or in part at any  time  without
premium or penalty.

         Should this Note be placed in the hands of attorneys for collection,
the  Company  agrees to pay, in addition to  principal and  interest, fees and
charges  due under the  Agreement,  any and all costs of collecting this Note,
including reasonable attorneys' fees and expenses.

<PAGE> 99

         The Company hereby waives demand, notice, protest and presentment.

         This Note shall be construed and enforced in  accordance  with the
laws of the State of Minnesota,  without  reference to its principles of
conflicts of law.

         IN WITNESS WHEREOF,  the Company has executed  this Note as of the
day and year first above written.

                         U.S. HOME MORTGAGE CORPORATION,

                         a Florida corporation

                         By:  /s/  Chester Sadowski

                              ---------------------
                         Its: Vice President

STATE OF TEXAS  )

                ) ss
COUNTY OF HARRIS)

         On October 13, 1999, before me, a Notary Public, personally  appeared
Chester P.  Sadowski,  the Vice President of U.S. HOME MORTGAGE CORPORATION, a
Florida corporation,  personally known to me (or  proved to me on the basis of
satisfactory evidence) to be the person whose name is subscribed to the within
instrument  and  acknowledged  to me that  he/she executed the same in his/her
authorized capacity, and that by his/her signature on the instrument the
person, or the entity upon behalf of which the person acted, executed the
instrument.

         WITNESS my hand and official seal.

                              /s/  Donna Monroe

                              ---------------------------
                                   Notary Public

  (SEAL)                           My Commission Expires: 3/26/03

<PAGE> 100
         EXHIBIT A
         UCC FINANCING STATEMENT

DEBTOR:           U.S. HOME MORTGAGE CORPORATION

SECURED PARTY:    RESIDENTIAL FUNDING CORPORATION

         All of  Debtor's right, title  and  interest  in the  following  (the
"Collateral"):

         (a) All Mortgage  Loans, including all Mortgage  Notes and  Mortgages
evidencing such Mortgage Loans which from time to time are delivered or caused
to be delivered to the Secured Party  (including  delivery to a third party on
behalf of the Secured Party), come into the possession,  custody or control of
the Secured Party for the purpose of assignment or pledge or in respect of
which an  Advance  has been  requested  by the  Debtor  or made by the Secured
Party ("Pledged Mortgages").

         (b) All Mortgage-backed Securities which are from time to time
created in whole or in part on the basis of the Pledged  Mortgages  and are
delivered or caused to be delivered  to, or are  otherwise in the  possession
of the Secured Party,  its agent,  bailee or custodian as assignee or pledged
to the Secured Party,  or for such purpose are  registered  by  book-entry  in
the name of, the Secured  Party  (including  delivery to or  registration  in
the name of a third party on behalf of the  Secured  Party) or in respect of
which from time to time an Advance has been  requested  by the Debtor or made
by the Secured  Party (the "Pledged Securities").

         (c) All private mortgage insurance and all commitments  issued by the
FHA,  FmHA or VA to insure or guarantee any  Mortgage  Loans  included  in the
Pledged Mortgages;  all guaranties related to Pledged Securities; all Purchase
Commitments  held by the Debtor covering the Pledged  Mortgages or the Pledged
Securities  and all proceeds resulting  from the  sale  thereof  to  investors
pursuant thereto;  and all personal property,  contract rights,  servicing and
servicing fees and income or other proceeds, amounts and payments payable to
the Debtor as compensation or reimbursement, accounts, payments, intangibles
and all other general intangibles of whatsoever kind relating to the Pledged
Mortgages, the Pledged Securities, said FHA commitments, FmHA commitments or
VA commitments and the Purchase Commitments, and all other documents or
instruments relating to the Pledged Mortgages and the Pledged Securities,
including, without limitation, any interest of the Debtor in any fire,
casualty or hazard  insurance  policies and any  awards  made by any public
body or  decreed by any court of  competent jurisdiction  for a taking or for
degradation  of value in any  eminent  domain proceeding as the same relate
to the Pledged Mortgages.

         (d) All right, title and interest of the Debtor in and to all escrow
accounts, documents, instruments, files, surveys, certificates,
correspondence, appraisals,   computer  programs,   tapes,  discs,  cards,
accounting  records (including all information,  records,  tapes,  data,
programs,  discs and cards necessary or helpful in the  administration  or
servicing of the Collateral) and other information and data of the Debtor
relating to the Collateral.
<PAGE> 101

         (e) All right, title and interest of the Debtor in and to any Hedging
Arrangements  entered into to protect the Debtor against changes in the value
of Pledged Mortgages or Pledged  Securities,  including,  without  limitation,
all rights to payment arising under such Hedging Arrangements.

         (f) All now existing  or  hereafter  acquired  cash  delivered  to or
otherwise in the possession of the Secured Party,  the Funding Bank, the
Secured Party's agent, bailee or custodian or designated on the books and
records of the Debtor as assigned or pledged to the Secured Party.

         (g) All cash and non-cash proceeds of the Collateral,  including  all
dividends,  distributions and other rights in connection with, and all
additions to, modifications of and replacements for, the Collateral,  and all
products and proceeds of the  Collateral, together with whatever is receivable
or received when the  Collateral  or proceeds  thereof  are sold,  collected,
exchanged  or otherwise  disposed of, whether such  disposition  is voluntary
or  involuntary, including,  without limitation,  all rights to payment with
respect to any cause of action affecting or relating to the Collateral or
proceeds thereof.

         (h) All right, title and interest of the Debtor in and to all
building loan agreements,  construction  contracts,  plans and specifications,
building permits,  governmental  approvals  and  licenses,  lender's  policies
of  title insurance,  "all risk" builder's insurance or workers' compensation
insurance as the same relate to the Pledged Mortgages.

         Capitalized terms defined herein shall have the following meanings:

         "Advance" means a disbursement  by the  Secured  Party to the Debtor,
including  readvances of funds previously advanced to the Debtor and repaid to
the Secured Party.

         "Affiliate" has the meaning  set forth in Rule  12b-2 of the  General
Rules and Regulations under the Exchange Act.

         "Agency Security" means a Mortgage-backed Security issued or
guarantied by Fannie Mae, Freddie Mac or Ginnie Mae.

         "Fannie Mae" means Fannie Mae, a corporation  created under the laws
of the United States, and any successor thereto.

         "FHA" means the Federal Housing Administration, and any successor
thereto.

         "FmHA" means the Farmers Home Administration, and any successor
thereto.

         "Freddie  Mac" means the Freddie Mac, a  corporation  created under
the laws of the United States, and any successor thereto.


<PAGE> 102

         "Funding Bank" means any bank Secured Party designates as a funding
bank.

         "Ginnie Mae" means Ginnie Mae, a corporation  created under the laws
of the United States, and any successor thereto.

         "Mortgage" means a mortgage or deed of trust on improved real
property.

         "Mortgage-backed Securities" means Ginnie Mae, Fannie Mae or
Freddie Mac securities that are backed by Mortgage Loans.

         "Mortgage Loan" means any loan evidenced by a Mortgage Note.

         "Mortgage Note" means a note secured by a Mortgage.

         "Parent" shall mean U.S. Home Corporation.

         "Purchase Commitment" means a written commitment issued in favor of
the Debtor by an  investor  pursuant  to which that  investor  commits  to
purchase Mortgage Loans or Mortgage-backed Securities.

         "VA" means the U.S. Department of Veterans Affairs and any successor
thereto.

THIS DOCUMENT WAS DRAFTED BY:

Residential Funding Corporation
8400 Normandale Lake Boulevard
Minneapolis, Minnesota  55437