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          FINET HOLDINGS CORPORATION AND MONUMENT MORTGAGE, INC.

                MERGER AGREEMENT AND PLAN OF REORGANIZATION

This Merger Agreement and Plan of Reorganization ("Agreement") is made as
of December 20, 1996, at San Francisco, California, among Finet Holdings
Corporation ("Finet"), a Delaware Corporation, having its principal office
at San Francisco, California; Finet Correspondent, Inc. ("Ficor"), a
California Corporation, having its principal office at San Francisco,
California; and Monument Mortgage, Inc. ("MMI"), a California Corporation,
having its principal office at Walnut Creek, California.

RECITALS

     A.   Finet and MMI wish to combine their respective businesses by
means of MMI becoming a subsidiary of Finet.

     B.   The parties wish to effectuate such a reorganization by means of
a reverse subsidiary triangular merger whereby Ficor, a wholly owned
subsidiary of Finet, will merge with MMI and Ficor will cease to exist.

     C.   The parties agree that after the merger and reorganization, that
MMI will be a wholly owned subsidiary of Finet and shall indicate that it
is a Finet company by appropriate use of the Finet name and logo.

TERMS OF REORGANIZATION

1.   Tax-Free Reorganization.

     Finet, Ficor and  MMI adopt this agreement as a merger and plan of
reorganization under Section 368(a)(2)(E) of the Internal Revenue Code.

2.   Effect of Merger.

     On the Effective Date, as defined in this Agreement, a merger shall
take place ("the Merger") whereby Ficor shall be merged with and  into MMI,
and MMI shall be the Surviving Corporation.  (The term "Surviving
Corporation" appearing in this Agreement denotes MMI after consummation of
the Merger.)  MMI's corporate name, existence, and all its purposes,
powers, and objectives shall continue unaffected and unimpaired by the
Merger, and as the Surviving Corporation it shall be governed by the laws
of the State of California and succeed to all of Ficor's rights, assets,
liabilities, and obligations in accordance with the California General
Corporation Law.

3.   Closing Date; Effective Date.

     Consummation of the Merger shall be effected as soon as practicable
after all the conditions established in this Agreement have been satisfied.
The closing shall be held at 1:00 pm, December 31, 1996 at the offices of
Miller, Mailliard & Culver in San Francisco, California, or at such other
time and place as the parties may agree.  The time and date of closing are
called the "Closing Date," and will be the same day as the Effective Date.

4.   Governance of Surviving Corporation.

     4.1.      Articles of Incorporation.

          The articles of incorporation of MMI in effect on the Effective
Date of the Merger shall become the articles of incorporation of the
Surviving Corporation.  From and after the Effective Date of the Merger,
said articles of incorporation, as they may be amended from time to time as
provided by law, shall be, and may be separately certified as, the articles
of incorporation of the Surviving Corporation.

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     4.2.      Bylaws.

          The bylaws of MMI in effect on the Effective Date of the Merger
shall be the bylaws of the Surviving Corporation until they are thereafter
duly altered, amended, or repealed.

     4.3. Directors and Officers.

          The directors of MMI on the Effective Date of the Merger shall be
the directors of the Surviving Corporation.  They shall hold office until
their successors have been elected and qualified.  The officers of MMI
shall be the officers on the effective date of the Merger shall be the
officers of Surviving Corporation.  Each shall hold office subject to the
bylaws and the pleasure of the directors of Surviving Corporation.

5.   The Shares.

     5.1. Capital Shares of MMI.

          The authorized capital stock of MMI consists of one million
shares (1,000,000) of Common Stock of no par value of which 10,000 shares
are issued and outstanding.  All shares are validly issued, fully paid, and
non-assessable, and such shares have been so issued in substantial
compliance with all federal and state securities laws.

     5.2. Capital Shares of Finet.

          The authorized capital stock of Finet consists of thirty million,
one hundred thousand shares (30,100,000), which consists of thirty million
shares (30,000,000) of Common Stock (par value $.01) and one hundred
thousand (100,000) shares of Preferred Stock (par value $.01), of which
13,037,719 common shares are currently issued and outstanding.  There are
existing warrants that may result in up to an additional 4,935,917 common
shares being issued.  There are existing stock options that may result in
up to an additional 511,876 common shares being issued.  There are existing
convertible debt instruments that may result in up to an additional
2,000,000 shares being issued.  All shares are validly issued, fully paid,
and non-assessable, and such shares have been so issued in substantial
compliance with all federal and state securities laws.

     5.3. Conversion of Shares.

          5.3.1.    Each share of Ficor's common stock issued and
outstanding shall be canceled and no shares of MMI shall be issued in
exchange therefor;

          5.3.2.    Each and every share of MMI's common stock issued and
outstanding immediately before the Effective Date (the "Target Common
Stock'), shall by virtue of the Merger and without action on the part of
MMI be converted into the right to receive from and to be delivered by
Finet the following items per share: 840 shares of Finet common stock and
$100 cash, both items to be delivered upon surrender to Finet for
cancellation of the certificate representing such share of MMI.

6.   MMI Representations and Warranties.

     MMI represents and warrants to Finet and Ficor  as follows:

     a)   MMI is duly organized, validly existing, and in good standing
under the laws of California, and has the corporate power to own all of its
properties and assets and to carry on its business as it is now being
conducted.

     b)   MMI's board of directors has authorized the execution of this
Reorganization Agreement, and MMI has the corporate power and is duly
authorized, subject to the approval of this Reorganization Agreement by its
shareholders, to merge Ficor into MMI pursuant to this Agreement.

     c)   MMI's issued and outstanding shares have been validly issued in
full compliance with all federal and state securities law, are fully paid
and nonassessable, and have voting rights.  There are no outstanding
subscriptions, options, rights, warrants, convertible securities, or other
agreements or commitments obligating MMI to issue or to transfer any
additional shares of its stock.

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7.   Representations of Acquiring corporation.

     Finet represents and warrants to MMI as follows:

     a)   Finet is duly organized, validly existing, and in good standing
as a Delaware corporation, and Ficor is a wholly owned subsidiary of Finet
and is duly organized, validly existing, and in good standing under the
laws of the State of California.

     b)   Finet and Ficor have full corporate power and authority to
execute and deliver this Agreement and to perform the obligations under,
and consummate the transactions contemplated by this Agreement.  This
Agreement is a valid and binding agreement of Finet and Ficor in accordance
with its terms.

     c)   Finet's issued and outstanding shares have been validly issued in
full compliance with all federal and state securities law, are fully paid
and nonassessable, and have voting rights.  There are no outstanding
subscriptions, options, rights, warrants, convertible securities, or other
agreements or commitments obligating Finet to issue or to transfer any
additional shares of its stock that are not disclosed to MMI.

8.   Entire Agreement; Modification; Waiver.

     This Agreement constitutes the entire agreement between the parties
pertaining to the subject matter contained in said agreement and it
supersedes all prior and contemporaneous agreements, representations, and
undertakings of the parties.  No supplement, modification, or amendment of
this Agreement shall be binding unless executed in writing by all the
parties.  No waiver of any of the provisions of this Agreement shall be
deemed, or shall constitute, a waiver of any other provision, whether or
not similar, nor shall any waiver constitute a continuing waiver.  No
waiver shall be binding unless executed in writing by the party making the
waiver.

9.   Prohibited Acts.

     MMI agrees not to do any of the following things prior the closing
date, and Finet and Ficor agree that prior to the closing date they will
not request or permit MMI to do any of the following things:  Issue any
stock or other securities, including any right or option to purchase or
otherwise acquire any of its stock, or issue any notes or other evidences
of indebtedness not in the usual course of business;

10.  Employment Contracts.

     Prior to the Effective Date, James Noack and James Umphryes shall have
entered into employment agreements on terms satisfactory to such executives
and their respective counsel and to Finet and its counsel.

11.  Delivery of records.

     MMI agrees that on or before the Closing Date, it will cause to be
delivered to Finet such corporate records or other documents of MMI in its
possession or control  as Finet may reasonably request.

12.  Successors.

     This Agreement shall be binding upon and inure to the benefit of the
heirs, personal representatives, successors, and assigns of the parties.

13.  Post-Closing

     13.1.     Board Seats.

          Finet shall nominate and use its best efforts to elect James
Noack and James Umphryes, currently officers at MMI, or their designees, to
the Board of Directors of Finet.
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     13.2.     Share Registration.

          Finet will, at Finet's expense, use its diligent best efforts to
cause the shares issued to the MMI Shareholders pursuant to this Agreement
( and desired to be sold by MMI Shareholders) to be registered with the
Securities and Exchange Commission so as to permit and facilitate their
sale and distribution to the public at the earliest available opportunity
in calendar year 1997.  Finet further agrees that it will, at Finet's
expense, cause the MMI Shareholders to be allowed to participate (on the
most favored basis permitted to any other Finet shareholder, whether by
separate registration rights agreement or otherwise) in all other future
registered public sales and distributions of Finet shares.  Finet further
acknowledges that the MMI Shareholders may transfer all or any part of the
shares issued to them by Finet pursuant to this Agreement so long as such
transfers are made in compliance with applicable securities laws, including
sales made pursuant to Rules 144 and Regulation S as promulgated by the
Securities and Exchange Commission.

     13.3.     Indemnification of MMI Shareholders.

          James Noack and James Umphryes ("MMI Shareholders") are the sole
shareholders of MMI.  Finet agrees to indemnify, defend, and hold harmless
MMI Shareholders against and in respect of any and all claims, demands,
losses, costs, expenses, obligations, liabilities, damages, recoveries, and
deficiencies, including interest, penalties, and reasonable attorneys'
fees, that it shall incur or suffer, which arises, result from, or relate
to any of the following:

          a)   Activities by Finet or its affiliates or subsidiaries
related to their obligations to perform under this Agreement.

          b)   Activities by Finet or its affiliates or subsidiaries prior
to the closing of this Agreement.

     13.4.     Indemnification of Finet Shareholders.

          MMI Shareholders agree to indemnify, defend, and hold harmless
Finet against and in respect of any and all claims, demands, losses, costs,
expenses, obligations, liabilities, damages, recoveries, and deficiencies,
including interest, penalties, and reasonable attorneys' fees, that it
shall incur or suffer, which arises, result from, or relate to any of the
following:

          a)   Activities by MMI Shareholders or its affiliates related to
their obligations to perform under this Agreement.

          b)   Activities by MMI Shareholders or its affiliates prior to
the closing of this Agreement.

     13.5.     Releases.

          Finet acknowledges that the MMI Shareholders intend to revoke and
terminate any personal guaranties previously given by them on behalf of MMI
and its affiliates, and that Finet agrees to use its best efforts to secure
releases of those personal guaranties promptly following the merger.  In
the event Finet, after reasonable effort is not able to obtain the
aforementioned release of personal guaranties, then Finet shall agree to
indemnify, defend, and hold harmless MMI Shareholders against and in
respect of any and all claims, demands, losses, costs, expenses,
obligations, liabilities, damages, recoveries, and deficiencies, including
interest, penalties, and reasonable attorneys' fees, that it shall incur or
suffer, which arises, result from, or relate to any personal guaranties
given by MMI Shareholders in performance of their duties as officers of
MMI, after the closing date.

14.  Remedies.

     14.1 Mediation and Arbitration.

          Initially all claims and controversies of any kind relating to
this Agreement shall be submitted to mediation pursuant to the services of
an established mediation service with the venue of the mediation being San
Francisco, California.

          In the event the matter cannot be disposed of by mediation, all
claims and controversies of any kind relating to this Agreement shall be
finally settled by arbitration before a single arbitrator in San Francisco,
in accordance with rules then obtaining of the American Arbitration
Association.  Said arbitration shall be subject to the laws of the State of
California and all parties to this Agreement shall be bound by the decision
in any such arbitration.  Judgment upon such arbitration may be entered by
any court of proper jurisdiction.  In any such arbitration, the
arbitrators: (i) shall apply the provisions of this Agreement without
varying therefrom in any respect, and they shall not have the power to add
to, modify or change the provisions of this Agreement; (ii) shall make
specific
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written findings of fact and law; and (iii) shall apply the law of
California to all substantive issued of law.  The foregoing shall not
preclude the parties from seeking injunctive or other equitable relief from
any court of proper jurisdiction pending the outcome of any arbitration.

          Attorney fees and costs shall be allocated by agreement in
mediation and by the arbitrators in arbitration.  In the event of
injunctive relief, the prevailing party shall be entitled to reasonable
attorney=s fees and costs.

     14.2.     Litigation Costs.

          If any legal action, or other proceeding is brought for the
enforcement of this Agreement, or because of an alleged dispute, breach,
default, or misrepresentation in connection with any of the provisions of
this Agreement, the successful or prevailing party or parties shall be
entitled to recover reasonable attorneys' fees and other costs incurred in
that action or proceeding, in addition to any other relief to which it or
they may be entitled.

     14.3.     "As Is" Transaction; Disclaimer of Other Representations and
Warranties.

          Except for the matters specifically provided for in this
Agreement, each party acknowledges and agrees that it is entering into the
transactions contemplated by this Agreement solely in reliance on its own
investigation and that each party has had the opportunity to review such
information, books, and records concerning the other party and its business
as the party and its advisors have deemed necessary or desirable for such
investigation.  Each party further acknowledges that no representations or
warranties of any kind other than those expressly provided for in this
Agreement have been made by the other party.  ALL OTHER WARRANTIES, EITHER
EXPRESS, IMPLIED OR STATUTORY, ARE DISCLAIMED.

     14.4.     Limitation of Liability.

          IN NO EVENT SHALL EITHER PARTY OR ITS SHAREHOLDERS, DIRECTORS,
OFFICERS, EMPLOYEES, AGENTS, SUCCESSORS, NOMINEES OR ASSIGNS BE LIABLE FOR
INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES INCLUDING LOSS OF PROFITS, OR
FOR PUNITIVE DAMAGES ARISING OUT OF OR CONNECTED WITH THIS AGREEMENT.

15.  Governing Laws.

     This Agreement shall be construed in accordance with, and governed by,
the laws of State of California as applied to contracts that are executed
and performed entirely in California.
16.  Severability.

     If any provision of this Agreement is held invalid or unenforceable by
any court of final jurisdiction, it is the intent of the parties that all
other provisions of this Agreement by construed to remain fully valid,
enforceable, and binding on the parties.

Executed in multiple counterparts, each of which shall be deemed a
duplicate original, as of the date first above written.


Finet Holdings Corporation


By:         /s/  L.  Daniel  Rawitch                                    By:
/s/ James W. Noack
     L. Daniel Rawitch, CEO                       James W. Noack, President



PREFERENCE AMERICA MORTGAGE NETWORK


By:        /s/ James A. Umphryes
     James A. Umphryes, Director