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                           First Amendment to Transfer & Servicing Agreement.rtf
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                                                                  EXECUTION COPY

                               FIRST AMENDMENT TO
                        TRANSFER AND SERVICING AGREEMENT

      THIS FIRST AMENDMENT TO TRANSFER AND SERVICING AGREEMENT (this
"AMENDMENT), dated as of September 15, 2000 (the "EFFECTIVE DATE"), is entered
into by and among PROJECT BRAVE LIMITED PARTNERSHIP, as issuer (the "ISSUER"),
FIFS ACQUSISITON FUNDING COMPANY, L.L.C., as transferor (the "TRANSFEROR"),
FIRST INVESTORS SERVICING CORPORATION, as servicer and a transferor party
("FISC"), ALAC RECEIVABLES CORP., as a transferor party ("ALACRC"), FIRST UNION
SECURITIES, INC., as deal agent and collateral agent ("FUSI"), WELLS FARGO BANK
MINNESOTA, NATIONAL ASSOCIATION, as backup servicer, collateral custodian and
indenture trustee ("WELLS FARGO"; together with the Issuer, the Transferor,
FISC, ALACRC and, FUSI, the "ORIGINAL PARTIES"), FIRST INVESTORS FINANCIAL
SERVICES, INC., as a transferor party ("FIRST INVESTORS") and FIRST INVESTORS
AUTO CAPITAL CORPORATION, as a transferor party ("FIACC"). Capitalized terms
used and not otherwise defined herein are used as defined in the Agreement (as
defined below).

      WHEREAS, the Original Parties entered into that certain Transfer and
Servicing Agreement, dated as of August 8, 2000 (as amended, the "AGREEMENT");

      WHEREAS, pursuant to the Purchase Agreement, dated as of January 1, 1998
by and between First Investors and FIACC (as amended, supplemented or otherwise
modified from time to time), First Investors has sold certain receivables to
FIACC (the "SOLD RECEIVABLES");

      WHEREAS, pursuant to the Security Agreement (the "SECURITY AGREEMENT"),
dated as of January 1, 1998 by and among FIACC, as debtor, FUSI, as deal agent
and collateral agent and First Investors, as seller (as amended, supplemented or
otherwise modified from time to time), certain amounts related to the Sold
Receivables shall be paid to the Noteholders and/or the Issuer;

      WHEREAS, the parties hereto desire to amend the Agreement in certain
respects to, among other things, add FIACC and First Investors as Transferor
Parties thereto;

      NOW THEREFORE, in consideration of the premises and the other mutual
covenants contained herein, the parties hereto agree as follows:

      SECTION 1. AMENDMENTS.

      (a) The definition of "ALAC Securitizations" is hereby amended in its
entirety to read as follows:

            ALAC SECURITIZATIONS: The ALAC Automobile Receivables Trust 1998-1
            and the FIACC Facility.
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      (b) The definition of "NIM Collateral Transferor Parties" is hereby
amended in its entirety to read as follows:

            NIM COLLATERAL TRANSFEROR PARTIES: The Transferor, the Issuer, FISC,
            First Investors, FIACC and ALACRC.

      (c)   The  definition of "Original  Transferor" is hereby amended in its
entirety to read as follows:

            ORIGINAL TRANSFEROR: FISC, FIACC, First Investors or ALACRC, as
            applicable.

      (d) The definition of "Series Collateral" in Section 1.1 of the Agreement
is hereby amended in its entirety to read as follows:

            SERIES COLLATERAL: The Series 1998-1 Collateral, as defined in the
            Spread Account Agreement.

      (e) The term "Spread Accounts" is hereby replaced with the term "Spread
Account" in each place it appears in the Agreement and the definition of "Spread
Accounts" is hereby amended in its entirety to read as follows:

            SPREAD ACCOUNT: The Series 1998-1 Spread Account as defined in the
            Spread Account Agreement and the Reserve Account as defined in the
            FIACC Facility.

      (f) The definition of "Servicing Strips" in Section 1.1 of the Agreement
is hereby amended in its entirety to read as follows:

            SERVICING STRIPS: Collectively, the Retained Pool Servicing Strip,
            the Servicing Strip (Series 1998-1) and the Servicing Strip (FIACC).

      (g)   The  definition of  "Transferor  Parties" is hereby amended in its
entirety to read as follows:

            TRANSFEROR PARTIES: The Transferor, the Issuer, FISC, ALACRC, First
            Investors and FIACC.

      (h) The following additional definitions are hereby added to Section 1.1
of the Agreement, in alphabetical order:

            FIACC: First Investors Auto Capital Corporation.

            FIACC FACILITY: The Security Agreement, dated as of January 1, 1998
            by and among by and among FIACC, as debtor, FUSI (f/k/a

                                      -2-
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            First Union Capital Markets Corp.), as deal agent and collateral
            agent and First Investors Financial Servicer, Inc., as seller, the
            Note Purchase Agreement, dated as of January 1, 1998, by and among
            FIACC, as debtor, FUSI (f/k/a First Union Capital Markets Corp.), as
            deal agent, the investors named therein, First Union, as liquidity
            agent and VFCC and each other agreement executed in connection with
            the foregoing, each as amended, supplemented, waived or otherwise
            modified to the date hereof and from time to time hereafter.

            FIRST INVESTORS: First Investors Financial Services, Inc.

            SERVICING STRIP (FIACC): The right of FISC to receive, pursuant to
            the terms and conditions of the Servicing Agreement, dated as of
            July 1, 1999 among FIACC, as debtor, Wells Fargo Bank Minnesota,
            National Association (f/k/a Norwest Bank Minnesota, National
            Association), as backup servicer and custodian and First Investors
            Servicing Corporation (f/k/a Auto Lenders Acceptance Corporation),
            as servicer, a servicing fee payable to FISC, as servicer under the
            Servicing Agreement in an amount equal to .50% of the outstanding
            principal balance of the loans serviced (if the servicing fee rate
            payable to FISC shall be 2.50% or less) or 1.00% of the outstanding
            principal balance of the loans serviced (if the servicing fee rate
            payable to FISC shall exceed 2.50%).

      SECTION 2.  CONVEYANCE OF INTEREST IN NIM COLLATERAL AND SERVICING STRIPS.


      On the Effective Date, the Transferor does hereby contribute and
absolutely assign to the Issuer, without recourse (subject to the obligations
set forth herein), all right, title and interest of the Transferor in and to the
Servicing Strip (FIACC) and such portion of the NIM Collateral not conveyed on
the Closing Date which shall include distributions under the FIACC Facility. It
is the intention of the Transferor that the transfer and assignment contemplated
by this Amendment shall constitute a contribution and absolute assignment of
such NIM Collateral and the Servicing Strip (FIACC) from the Transferor to the
Issuer and the beneficial interest in and title to such NIM Collateral and the
Servicing Strip (FIACC) shall not be part of the Transferor's estate in the
event of the filing of a bankruptcy petition by or against the Transferor under
any bankruptcy law. In the event that, notwithstanding the intent of the
Transferor, the transfer and assignment contemplated hereby is held not to be a
sale, this Agreement shall constitute a grant of a security interest in the
property referred to in this SECTION 2 for the benefit of the Secured Parties.

      SECTION 3.  NOTEHOLDER CONSENT.

      Each of the Noteholders and the Deal Agent hereby acknowledges its consent
to this Amendment and Supplemental Indenture No.1, dated as of September 15,
2000 by and between the Issuer and the Indenture Trustee by signing its name on
the signature pages hereto.

                                      -3-
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      SECTION 4.  REPRESENTATIONS AND WARRANTIES.

      First Investors and FIACC each hereby makes to the Deal Agent and each
other Secured Party each of the representations and warranties in Section 3.2 of
the Agreement as of the Effective Date and each other Transferor Party hereby
reaffirms such representations and warranties as of the Effective Date.

      First Investors and FIACC each hereby makes to the Transferor, the Deal
Agent and each other Secured Party each of the representations and warranties in
Section 3.1 of the Security Agreement as of the Effective Date.

      SECTION 5.  CONDITIONS PRECEDENT.

      The effectiveness of this Amendment is subject to the satisfaction of the
following conditions precedent:

      (a) The Deal Agent shall have received a copy of the First Amendment to
the Amended and Restated NIM Collateral Purchase Agreement, duly executed by
each of the parties thereto;

      (b) The Deal Agent shall have received a copy of the Supplemental
Indenture No. 1, duly executed by each of the parties thereto; and

      (c) Each of the conditions precedent listed in Section 2 of the Third
Amendment to the Security Agreement shall have been satisfied and the Deal Agent
shall have received copies of each of the documents listed therein.

      SECTION 6.  AGREEMENT IN FULL FORCE AND EFFECT AS AMENDED.

      Except as specifically amended hereby, the Agreement shall remain in full
force and effect. All references to the Agreement shall be deemed to mean the
Agreement as modified hereby. This Amendment shall not constitute a novation of
the Agreement, but shall constitute an amendment thereof. The parties hereto
agree to be bound by the terms and conditions of the Agreement, as amended by
this Amendment, as though such terms and conditions were set forth herein.

      SECTION 7.  MISCELLANEOUS.

      (a) This Amendment may be executed in any number of counterparts, and by
the different parties hereto on the same or separate counterparts, each of which
shall be deemed to be an original instrument but all of which together shall
constitute one and the same agreement. Delivery of an executed counterpart of a
signature page to this Amendment by facsimile shall be as effective as delivery
of a manually executed counterpart of this Amendment.

                                      -4-
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      (b) The descriptive headings of the various sections of this Amendment are
inserted for convenience of reference only and shall not be deemed to affect the
meaning or construction of any of the provisions hereof.

      (c) This Amendment may not be amended or otherwise modified except as
provided in the Agreement.

      (d) THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER
THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS CONFLICT OF LAWS
PROVISIONS.

                 [Remainder of Page Intentionally Left Blank]

                                      -5-
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      IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

                              PROJECT BRAVE LIMITED PARTNERSHIP,
                                    as Issuer

                                   By:   FIFS Acquisition Funding Company,
                                         L.L.C., as  general partner,

                                               By:   FIALAC Holdings, Inc.,
                                                     a member


                                   By: ________________________________
                                   Name:
                                   Title:

                                   Project Brave Limited Partnership
                                   c/o FIFS Acquisition Funding
                                       Company, L.L.C.
                                   675 Bering Drive, Suite 710
                                   Houston, TX 77057

                                   Attention:
                                   Facsimile:
                                   Telephone:

                                   FIFS ACQUISITION FUNDING
                                   COMPANY, L.L.C., as Transferor

                                   By:  FIALAC Holdings, Inc., a member

                                   By: ________________________________
                                   Name:
                                   Title:

                                   FIFS Acquisition Funding Company, L.L.C.
                                   c/o First Investors Auto Capital Corporation
                                   675 Bering Drive
                                   Suite 710
                                   Houston, TX 77057

                                   Attention: Bennie Duck
                                   Facsimile: 713-977-0657
                                   Telephone: 713-977-2600

                                      -6-
<PAGE>
                                   FIRST INVESTORS SERVICING
                                   CORPORATION, as a Transferor Party


                                   By: ________________________________
                                   Name:
                                   Title:

                                   First Investors Servicing Corporation
                                   675 Bering Drive
                                   Suite 710
                                   Houston, TX 77057

                                   Attention: Bennie Duck
                                   Facsimile: 713-977-0657
                                   Telephone: 713-977-2600

                                   ALAC RECEIVABLES CORP., as a
                                   Transferor Party

                                   By: ________________________________
                                   Name:
                                   Title:

                                   ALAC Receivables Corp.
                                   675 Bering Drive
                                   Suite 710
                                   Houston, TX 77057

                                   Attention: Bennie Duck
                                   Facsimile: 713-977-0657
                                   Telephone: 713-977-2600

                                   FIRST INVESTORS
                                   FINANCIAL SERIVICES.,
                                   as a Transferor Party

                                   By: ________________________________
                                   Name:
                                   Title:

                                   First Investors Financial Services, Inc.
                                   675 Bering Drive
                                   Suite 710
                                   Houston, TX 77057

                                      -7-
<PAGE>
                                   Attention: Bennie Duck
                                   Facsimile: 713-977-0657
                                   Telephone: 713-977-2600

                                   FIRST INVESTORS AUTO CAPITAL CORPORATION.,
                                   as a Transferor Party

                                   By: ________________________________
                                   Name:
                                   Title:

                                   First Investors Auto Capital Corporation
                                   675 Bering Drive
                                   Suite 710
                                   Houston, TX 77057

                                   Attention: Bennie Duck
                                   Facsimile: 713-977-0657
                                   Telephone: 713-977-2600

                                       -8-
<PAGE>
                                   FIRST UNION SECURITIES, INC.,
                                   as Deal Agent and Collateral Agent


                                   By: ________________________________
                                   Name:
                                   Title:

                                   First Union Securities, Inc.
                                   One First Union Center, TW-9
                                   Charlotte, North Carolina  28288
                                   Attention: John Foxgrover
                                   Telephone: 704-383-8437
                                   Facsimile: 704-383-1085


                                      -9-
<PAGE>
                                   WELLS FARGO BANK MINNESOTA, NATIONAL
                                   ASSOCIATION, not in its individual capacity
                                   but solely as Backup Servicer, Collateral
                                   Custodian and Indenture Trustee


                                   By: ________________________________
                                   Name:
                                   Title:


                                   MAC N9311-161
                                   Sixth Street and Marquette Avenue
                                   Minneapolis, MN 55479
                                   Attention: Corporate Trust Services -
                                               Asset Backed Administration
                                   Telephone: (612) 667-8058
                                   Facsimile: (612) 667-3539

Accepted and agreed
this 15th day of September, 2000

VARIABLE FUNDING CAPITAL CORPORATION,
as Class A Noteholder and Class B Noteholder

By: First Union Securities, Inc.,
as attorney-in-fact

By: ________________________________
      Name:
      Title:

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