EXHIBIT 4(nnn)

      Funding Note Issuance and Security Agreement among Federal National
Mortgage Association, CRIIMI MAE Inc. and CRIIMI MAE Financial Corporation III







                                                              B&W FINAL 12/12/95



                  FUNDING NOTE ISSUANCE AND SECURITY AGREEMENT


                          Dated as of December 15, 1995

                                      among

                      FEDERAL NATIONAL MORTGAGE ASSOCIATION

                                 CRIIMI MAE INC.

                                       and

                      CRIIMI MAE FINANCIAL CORPORATION III


                               TABLE OF CONTENTS

                                    ARTICLE I

                                   DEFINITIONS

     1.1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . .    1
     1.2. Usage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    6

                                   ARTICLE II

                        SALE AND PURCHASE OF FUNDING NOTE

     2.1. Authorization of Funding Note . . . . . . . . . . . . . . . . . .    7
     2.2. Issuance and Exchange of Funding Note . . . . . . . . . . . . . .    7
     2.3. Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    7
     2.4. Non-Recourse Obligation . . . . . . . . . . . . . . . . . . . . .    7
     2.5. Interest and Principal on the Funding Note  . . . . . . . . . . .    7
     2.6. Optional Prepayment at Direction of Fannie Mae  . . . . . . . . .    7
     2.7. Optional Prepayment by Subsidiary . . . . . . . . . . . . . . . .    8
     2.8. Special Prepayment by Subsidiary  . . . . . . . . . . . . . . . .    9
     2.9. Prepayment and Redemption . . . . . . . . . . . . . . . . . . . .   10

                                   ARTICLE III

                      COLLATERAL SECURITY FOR FUNDING NOTE

     3.1. Grant of Security Interest  . . . . . . . . . . . . . . . . . . .   10
     3.2. Collection of Money . . . . . . . . . . . . . . . . . . . . . . .   10
     3.3. Collection Account  . . . . . . . . . . . . . . . . . . . . . . .   10
     3.4. Satisfaction; Release of Security Interest  . . . . . . . . . . .   12

                                   ARTICLE IV

                              CONDITIONS TO CLOSING

     4.1. Conditions Precedent to Closing . . . . . . . . . . . . . . . . .   12
     4.1.1.    Delivery of Pledged Securities . . . . . . . . . . . . . . .   12
     4.1.2.    Absence of Material Adverse Change . . . . . . . . . . . . .   12
     4.1.3.    Representations and Warranties . . . . . . . . . . . . . . .   12
     4.1.4.    Performance; No Default  . . . . . . . . . . . . . . . . . .   12
     4.1.5.    Litigation, Etc  . . . . . . . . . . . . . . . . . . . . . .   12
     4.1.6.    Compliance Certificate . . . . . . . . . . . . . . . . . . .   12
     4.1.7.    Tax Status . . . . . . . . . . . . . . . . . . . . . . . . .   12
     4.1.8.    Opinions of Counsel  . . . . . . . . . . . . . . . . . . . .   13
     4.1.9.    Fairness Opinion . . . . . . . . . . . . . . . . . . . . . .   13
     4.1.10.   Closing Papers . . . . . . . . . . . . . . . . . . . . . . .   13
     4.1.11.   Conversion Fee . . . . . . . . . . . . . . . . . . . . . . .   14
     4.1.12.   Proceedings  . . . . . . . . . . . . . . . . . . . . . . . .   14

                                    ARTICLE V

                         REPRESENTATIONS AND WARRANTIES

     5.1. Representations and Warranties of Fannie Mae  . . . . . . . . . .   14
     5.1.1.    Organization . . . . . . . . . . . . . . . . . . . . . . . .   14
     5.1.2.    Authorization  . . . . . . . . . . . . . . . . . . . . . . .   14
     5.1.3.    No Violation; Conflicts  . . . . . . . . . . . . . . . . . .   15
     5.2. Representations and Warranties of Subsidiary and Parent . . . . .   15
     5.2.1.    Organization, Good Standing  . . . . . . . . . . . . . . . .   15
     5.2.2.    No Violation; Conflicts  . . . . . . . . . . . . . . . . . .   15
     5.2.3.    Authorization  . . . . . . . . . . . . . . . . . . . . . . .   16
     5.2.4.    Consents . . . . . . . . . . . . . . . . . . . . . . . . . .   16

     5.2.5.    Litigation, Proceedings, etc . . . . . . . . . . . . . . . .   16
     5.2.6.    Compliance with Laws . . . . . . . . . . . . . . . . . . . .   16
     5.2.7.    Capital Stock  . . . . . . . . . . . . . . . . . . . . . . .   16
     5.2.8.    Solvency, etc  . . . . . . . . . . . . . . . . . . . . . . .   17
     5.2.9.    Disclosure . . . . . . . . . . . . . . . . . . . . . . . . .   17
     5.2.10.   Pledged Securities . . . . . . . . . . . . . . . . . . . . .   17
     5.2.11.   Legal Counsel, etc . . . . . . . . . . . . . . . . . . . . .   18
     5.2.12.   Separate Existence . . . . . . . . . . . . . . . . . . . . .   18
     5.2.13.   Establishment of Subsidiary  . . . . . . . . . . . . . . . .   18

                                   ARTICLE VI

                                    COVENANTS

     6.1. Covenants of Fannie Mae . . . . . . . . . . . . . . . . . . . . .   18
     6.2. Covenants of Subsidiary . . . . . . . . . . . . . . . . . . . . .   18
     6.2.1.    Corporate Existence  . . . . . . . . . . . . . . . . . . . .   19
     6.2.2.    Performance  . . . . . . . . . . . . . . . . . . . . . . . .   19
     6.2.3.    Security Interest  . . . . . . . . . . . . . . . . . . . . .   19
     6.2.4.    Encumbrances . . . . . . . . . . . . . . . . . . . . . . . .   19
     6.2.5.    Taxes  . . . . . . . . . . . . . . . . . . . . . . . . . . .   19
     6.2.6.    Compliance With Laws, etc  . . . . . . . . . . . . . . . . .   19
     6.2.7.    Examination of Records, etc  . . . . . . . . . . . . . . . .   19
     6.2.8.    Restriction on Additional Indebtedness . . . . . . . . . . .   20
     6.2.9.    Additional Covenants Regarding Independence of Subsidiary  .   20
     6.2.10.   Governing Instruments  . . . . . . . . . . . . . . . . . . .   20
     6.3. Covenants of Parent . . . . . . . . . . . . . . . . . . . . . . .   20
     6.3.1.    Subsidiary's Performance . . . . . . . . . . . . . . . . . .   20
     6.3.2.    Bankruptcy . . . . . . . . . . . . . . . . . . . . . . . . .   20
     6.3.3.    Compliance with Laws, etc  . . . . . . . . . . . . . . . . .   20
     6.4. Tax-Related Provisions  . . . . . . . . . . . . . . . . . . . . .   20
     6.4.1.    Consistent Performance . . . . . . . . . . . . . . . . . . .   20
     6.4.2.    Providing Information  . . . . . . . . . . . . . . . . . . .   20

                                   ARTICLE VII

                              DEFAULTS AND REMEDIES

     7.1. Events of Default . . . . . . . . . . . . . . . . . . . . . . . .   21
     7.2. Remedies  . . . . . . . . . . . . . . . . . . . . . . . . . . . .   21
     7.3. Additional Remedies . . . . . . . . . . . . . . . . . . . . . . .   22
     7.4. No Remedy Exclusive . . . . . . . . . . . . . . . . . . . . . . .   22

                                  ARTICLE VIII

                                 INDEMNIFICATION

     8.1. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . .   23
     8.2. Contribution  . . . . . . . . . . . . . . . . . . . . . . . . . .   23

                                   ARTICLE IX

                                  MISCELLANEOUS

     9.1. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   23
     9.2. Parties Entitled to Benefit, etc  . . . . . . . . . . . . . . . .   24
     9.3. Transfer and Assignment . . . . . . . . . . . . . . . . . . . . .   24
     9.4. Entire Agreement; Amendments; Severability of Provisions  . . . .   24
     9.5. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . .   25
     9.6. No Waiver; Remedies . . . . . . . . . . . . . . . . . . . . . . .   25
     9.7. Costs and Expenses  . . . . . . . . . . . . . . . . . . . . . . .   25
     9.8. Execution of Counterparts . . . . . . . . . . . . . . . . . . . .   25
     9.9. Survival of Representations, Warranties and Covenants . . . . . .   25


 
                                    EXHIBITS

Exhibit A Form of Funding Note 
Exhibit B Form of Assignment and Agreement

Schedule I - Schedule of Pledged Securities



FUNDING NOTE ISSUANCE AND SECURITY AGREEMENT, dated as of December 15, 1995,
among the FEDERAL NATIONAL MORTGAGE ASSOCIATION, a corporation duly organized
and existing under and by virtue of the laws of the United States (12 U.S.C. 
1716 et. seq.) ("Fannie Mae"), CRIIMI MAE INC., a Maryland corporation (the
"Parent"), and CRIIMI MAE FINANCIAL CORPORATION III, a Maryland corporation (the
"Subsidiary").

                                    RECITALS

     The Parent is the owner of certain GNMA Securities (as defined herein).

     Pursuant to the Assignment and Agreement (as defined herein), the Parent
will transfer the GNMA Securities (as defined herein) to the Subsidiary, which
will issue the Funding Note (as defined herein).  Payments on the Funding Note
will be made from distributions received on the Collateral (as defined herein),
which will be pledged by the Subsidiary to Fannie Mae to secure the Funding
Note.

     Fannie Mae is willing to issue to the Subsidiary in exchange for the
Funding Note the entire issue of its Guaranteed Grantor Trust Pass-Through
Certificates, Series 1995-T5, which will entitle the holders thereof to receive
principal and interest distributions from payments on the Funding Note.

     In consideration of the premises and the mutual covenants and
representations hereinafter contained, the parties hereto agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

     1.1. Definitions.  As used in this Agreement, the following terms will have
the following meanings unless the context requires otherwise:

     Affiliate:  any Person directly or indirectly controlling or controlled by
or under common control with Parent or Subsidiary, including (without
limitation) any Person beneficially owning or holding 5% or more of any class of
voting securities of parent or Subsidiary or any other corporation of which
Parent owns or holds 5% or more of any class of voting securities, provided
that, for purposes of this definition, "control" (including, with correlative
meanings, the terms "controlled by" and "under common control with"), as used
with respect to any Person, will mean the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities or by contract
or otherwise.

     Agreement:  this Funding Note Issuance and Security Agreement.

     Assignment and Agreement: the Assignment and Agreement dated as of the date
hereof between the Parent and the Subsidiary pursuant to which Parent sells,
assigns, transfers and conveys the GNMA Securities to the Subsidiary, in the
form of Exhibit B.

     Assumed Reinvestment Rate: as to any Special Prepayment Determination Date,
the overnight Fed Funds rate for such date.

     Bankrupt: with respect to the Parent or Subsidiary, means,

     (a)  a court (i) enters a decree or order for relief in respect of Parent
          or Subsidiary in an involuntary case under any applicable bankruptcy,
          insolvency or other similar law now or hereafter in effect, (ii)
          appoints a receiver, liquidator, assignee, custodian or sequestrator
          (or other similar official) of Parent or Subsidiary or for all or
          substantially all its property or (iii) orders the winding up or
          liquidation of its affairs, and such decree or order remains unstayed
          and in effect for a period of 60 consecutive days; or 

     (b)  Parent or Subsidiary (i) commences a voluntary case under any
          applicable bankruptcy, insolvency or other similar law now or
          hereafter in effect, (ii) consents to the entry of any order for
          relief in an involuntary case under any such law, (iii) consents to
          the appointment of or taking possession by a receiver, liquidator,
          assignee, trustee, custodian, or sequestrator (or other similar
          official) of parent or Subsidiary or for any substantial part of its
          property, (iv) makes any general assignment for the benefit of
          creditors, (v) fails generally to pay its debts as they become due or
          (vi) takes any action in furtherance of the foregoing.

     Business Day: a day other than (a) a Saturday or Sunday, (b) a day on which
the Depository is authorized or obligated by law or executive order to remain
closed, (c) a day on which offices of the federal government located in the
District of Columbia generally are closed for business or (d) a day on which the
offices of Fannie Mae are closed.

     Carry Forward Principal Amount: as to any Quarterly Payment Date, the
excess, if any, of (x) the portion of the GNMA Distribution allocable to
principal for the GNMA Distribution Date in the month of the immediately
preceding Quarterly Payment Date over (y) the amount of principal reported by
GNMA in the latest Principal Factors published prior to the 13th day of such
month to be receivable in respect of the Pledged Securities on such GNMA
Distribution Date.

     Closing: the meaning specified in Section 2.3.

     Collateral: the meaning specified in Section 3.1.

     Collection Account: the meaning specified in Section 3.3 hereof.

     Depository: The Depository Trust Company, a New York chartered limited
purpose trust company, or any successor depository selected or approved by
Fannie Mae.

     Due Period: as to any Quarterly Payment Date, the three-month period ending
on the last day of the month of such Quarterly Payment Date.

     Eligible Investments: any one or more of the following obligations or
securities:

          (i)  direct obligations of, and obligations fully guaranteed by, the
United States of America ("USA"), Fannie Mae, or any agency or instrumentality
of the USA the obligations of which are backed by the full faith and credit of
the USA;

          (ii) (A) demand and time deposits in, certificates of deposit of, or
bankers' acceptances issued by any depository institution or trust company
incorporated under the laws of the USA or any state thereof and subject to
supervision and examination by federal and/or state banking authorities, so long
as the commercial paper and long-term debt obligations of such depository
institution or trust company (or in the case of the principal depository
institution in a holding company system, of such holding company), at the time
of such investment or the contractual commitment providing for such investment,
have credit ratings of at least A-1 and AA, respectively, from Standard &
Poor's, a division of the McGraw-Hill Companies, Inc. ("S&P"), at least P-1 and
Aa2, respectively, from Moody's Investors Service, Inc. ("Moody's") or at least
F-1 and AA, respectively, from Fitch Investors Service, Inc. ("Fitch"), and (B)
any other demand or time deposit or certificate of deposit that is fully insured
by the Federal Deposit Insurance Corporation;


          (iii)       repurchase agreements with a depository institution or
trust company (acting as principal) specified in clause (ii) above with respect
to (A) any security described in clause (i) above or (B) any other security
issued or guaranteed by an agency or instrumentality of the USA, provided that
in either case Fannie Mae or its custodian shall take delivery of such security;
and

          (iv) securities bearing interest or sold at a discount that have a
credit rating of at least A-1 (short term) or AA (long term unsecured) from S&P,
at least P-1 (short term) or Aa2 (long term unsecured) from Moody's or at least
F-1 (short term) or AA (long term unsecured) from Fitch; provided, however, that
such securities shall not be eligible Investments to the extent that investment
therein would cause the then outstanding principal amount of securities issued
by such corporation in the Collection Account to exceed 10% of the aggregate
outstanding principal amount of all Eligible Investments held as part of the
Collection Account; 

provided, however, that no obligation or security shall be an Eligible
Investment if such obligation or security evidences either (a) a right to
receive only interest payments with respect to the obligation underlying such
obligation or security or (b) a right to receive both principal and interest
payments derived from obligations underlying such obligation or security where
the interest and principal payments with respect to such obligation or security
provide a yield to maturity of greater than 120% of the yield at par of such
underlying obligations.

     Event of Default: the meaning specified in Section 7.1.

     Excess Funds: as to any Due Period and as of any date of determination, the
excess of (i) the sum of Projected Non-Principal Collections and Excess
Principal Collections for such Due Period over (ii) interest payable on the
Funding Note on the next succeeding Quarterly Payment Date.

     Excess Principal Collections: shall mean, with respect to any Due Period
and as of any date of determination, the excess of (i) the sum of (x) principal
received in respect of the Pledged Securities during such Due Period and (y)
with respect to any GNMA Distribution Date occurring in such Due Period
subsequent to such date of determination and for which the final Principal
Factor has been received, the amount of the scheduled distribution of principal
for such GNMA Distribution Date, over (ii) the outstanding principal balance of
the Funding Note.

     Fannie Mae: the meaning specified in the preamble to this Agreement.

     Funding Note: the meaning specified in Section 2.1.

     Funding Note Coupon: the interest rate specified in the Funding Note.

     Funding Surplus: with respect to any Quarterly Payment Date, an amount
equal to the excess of (a) the sum of (i) GNMA Distributions made on the Pledged
Securities during the month of, and on or prior to, such Quarterly Payment Date
and in respect of the two immediately preceding GNMA Distribution Dates, (ii)
any amounts received pursuant to investments and reinvestments of such GNMA
Distributions made pursuant to Section 3.3 hereof and (iii) any amounts
deposited in the Collection Account by the Subsidiary during the two immediately
preceding months pursuant to Section 2.8(c) hereof over (b) the sum of (i)
amounts due on the Funding Note on such Quarterly Payment Date, (ii) any amounts
paid on the Funding Note on any Special Prepayment Date that occurred in the two
immediately preceding months, (iii) any amounts previously released to the
Subsidiary during the related Due Period as Excess Funds and (iv) the Carry-
Forward Principal Amount, if any, for the following Quarterly Payment Date.

     GNMA: the Government National Mortgage Association.


     GNMA Distribution: any principal, interest, mortgage prepayment premium,
guarantee or other payment made in respect of a GNMA Security pledged as a
Pledged Security.

     GNMA Distribution Date: as to any GNMA Security, the 15th calendar day of
each month, commencing in January 1996, or if such 15th calendar day is not a
Business Day, the Business Day next succeeding such 15th calendar day.

     GNMA Securities: fully modified pass-through mortgage-backed securities
guaranteed as to timely payment of principal and interest by GNMA. 

     Governing Instruments: the certificates of incorporation and bylaws of
Parent and Subsidiary.

     GTCs:  The Guaranteed Grantor Trust Pass-Through Certificates, Series
1995-T5, issued by Fannie Mae to the Subsidiary, in exchange for, and evidencing
a beneficial interest in, the Funding Note.

     Indebtedness: with respect to any Person means any indebtedness, whether or
not contingent, in respect of borrowed money or evidenced by bonds, notes,
debentures or similar instruments or letters of credit (or reimbursement
agreements in respect thereof) or representing the balance deferred and unpaid
of the purchase price of any property, except any such balance that constitutes
an accrued expense or a trade payable and which is not overdue by more than 90
days and not being contested in good faith, if and to the extent such
indebtedness would appear as a liability upon a balance sheet of such Person
prepared on a consolidated basis in accordance with generally accepted
accounting principles, and also includes, to the extent not otherwise included,
any guarantee of Indebtedness.

     Interest Accrual Period: as to any GNMA Distribution Date, the calendar
month preceding such GNMA Distribution Date.  As to any Quarterly Payment Date,
the three calendar months immediately preceding such Quarterly Payment Date.

     Material Adverse Effect: any circumstance or event which (a) may be
reasonably expected to have any material adverse effect whatsoever upon the
validity or enforceability of this Agreement or the Funding Note, (b) may be
reasonably expected to be material and adverse to the financial condition,
business, operations or property of Subsidiary or (c) may be reasonably expected
to materially impair the ability of Subsidiary to fulfill its obligations under
this Agreement or the Funding Note.

     Officer's Certificate: a certificate executed on behalf of Parent or
Subsidiary by the Chairman, President, General Counsel or one of the Vice
Presidents and the Chief Financial Officer of Parent or Subsidiary, as the case
may be.

     Parent: the meaning specified in the preamble to this Agreement.

     Payment Date: the 17th calendar day of any month (or, if such 17th day is
not a Business Day, the Business Day immediately following such 17th day).

     Person or person: any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, limited liability company,
unincorporated organization or government or other agency or political
subdivision thereof.

     Pledged Securities: the GNMA Securities listed on Schedule I hereto and
pledged by the Subsidiary to Fannie Mae hereunder to secure payment of the
Funding Note.

     Prepayment Amount: the meaning specified in Section 2.7 hereof.

     Prepayment Date: the meaning specified in Section 2.7 hereof.

     Principal Factor: as to any Pledged Security and GNMA Distribution Date,
the principal factor reported by GNMA with respect to such Pledged Security and
such GNMA Distribution Date, which factor reflects the amount receivable as
principal by the holders of such Pledged Security on such date. 

     Projected Non-Principal Collections: as to any Due Period and as of any
date of determination, the sum of (i) interest distributions received in respect
of the Pledged Securities during such Due Period, (ii) interest scheduled to be
received prior to the next succeeding Quarterly Payment Date in respect of all
Eligible Investments currently on deposit in the Collection Account and (iii)
Scheduled Interest Distributions in respect of each succeeding GNMA Distribution
Date occurring in such Due Period.

     Quarterly Payment Date: the Payment Date occurring in each of March, June,
September, and December commencing in March, 1996.

     Scheduled Interest Distributions: as to (i) any GNMA Distribution Date with
respect to which final Principal Factors have been received for the preceding
GNMA Distribution Date, the product of (x) 1/12th of the Weighted Average GNMA
Coupon and (y) the aggregate of the original principal balances of the Pledged
Securities multiplied by the applicable final Principal Factors, and (ii) any
GNMA Distribution Date with respect to which final Principal Factors have not
been received for the preceding GNMA Distribution Date, the product of (x)
1/12th of the Weighted Average GNMA Coupon and (y) the excess of the aggregate
current principal balance of the Pledged Securities over the current principal
balance of the Funding Note.

     Series Documents: all agreements, documents, certificates and other papers
(including this Agreement) required to be executed by Subsidiary or Parent in
connection with the issuance of the Funding Note and the GTCs.

     Solvent: when used with respect to any person, means at the time of
determination, that (a)(i) the fair saleable value and the fair value of such
person's assets, after giving effect to the issuance and sale of the Funding
Note pursuant to this Agreement, exceeds and will exceed the amount that will be
required to be paid on or in respect of the existing debts and other liabilities
(including contingent liabilities) as they mature, (ii) such person will not
have unreasonably small capital with which to conduct its businesses and (iii)
such person will have the ability to pay its debts as they mature; and (b) in
any case, such person is not "insolvent" within the meaning of (i) Section 2 of
the Uniform Fraudulent Transfer Act or Uniform Fraudulent Conveyance Act of any
applicable jurisdiction (and, with respect to such Act, is not properly to be
presumed to be insolvent under Section 2(b) thereof), (ii) Section 101 of Title
II of the United States Code or (iii) any comparable law or regulation
applicable in the circumstances.

     Special Prepayment Date: the meaning specified in Section 2.8.

     Special Prepayment Determination Date: the meaning specified in Section
2.8.

     Subsidiary: the meaning specified in the preamble to this Agreement.

     Trust Agreement:  the trust agreement dated as of December 1, 1995 executed
by Fannie Mae, in its corporate capacity and in its capacity as trustee,
pursuant to which the GTCs are issued and outstanding.

     Underwriter: Donaldson, Lufkin & Jenrette Securities Corporation.

     Weighted Average GNMA Coupon: as to any GNMA Distribution Date, the
weighted average of the interest rates specified in the Pledged Securities,
weighted on the basis of the respective principal balances thereof.



    1.2. Usage.  As used herein, references to Articles, Sections, Exhibits and
Schedules are to articles and sections hereof and exhibits and schedules hereto,
references to a person are also references to its successors and assigns,
references to a document are to it as amended, waived and otherwise modified
from time to time, references to a statute or another governmental rule are to
it as amended and otherwise modified from time to time, and the word "including"
and correlative words shall be deemed to be followed by "without limitation"
whether or not followed by such words of like import.  The definitions set forth
in Section 1.1 are equally applicable both to the singular and plural forms and
the feminine, masculine and neuter forms of the terms defined.  The headings of
Articles and Sections and the table of contents relating hereto have been
included solely for convenience of reference and shall not have any effect to
the construction hereof.


                                   ARTICLE II

                        SALE AND PURCHASE OF FUNDING NOTE

     2.1. Authorization of Funding Note.  Subsidiary will authorize the issue
and exchange of $198,394,480 principal amount of its 7% Funding Note due March
17, 2035 (the "Funding Note"), to be substantially in the form of the Funding
Note set forth in Exhibit A.

     2.2. Issuance and Exchange of Funding Note.  Subsidiary will issue the
Funding Note to Fannie Mae and, subject to the terms and conditions of this
Agreement, Fannie Mae will issue to the Subsidiary in exchange therefor the GTCs
evidencing undivided beneficial interests therein.  The Funding Note shall be
secured by the Collateral.

     2.3. Closing.  The exchange of the Funding Note for the GTCs will take
place at the offices of Fannie Mae, 3900 Wisconsin Avenue, N.W., Washington,
D.C. 20016-2899 at 10:00 a.m., Eastern time, at a Closing (the "Closing") on
December 15, 1995 or on such other Business Day thereafter on or prior to
December 29, 1995 as may be agreed upon by Subsidiary and Fannie Mae.  The
Funding Note will be in the form of a single Funding Note dated the date of the
Closing and registered in the name of Fannie Mae.  Subsidiary will deliver the
duly executed Funding Note and the documents set forth in Section 4.1.10 to
Fannie Mae on or prior to Closing to be held in escrow as provided for in
Section 4.1.10.  At the Closing, Subsidiary and Parent will instruct Fannie Mae
(either in writing or by telephone followed by written confirmation) to release
from escrow (a) the Funding Note against issuance by Fannie Mae to the
Subsidiary of the GTCs and (b) the documents set forth in Section 4.1.10 and
Fannie Mae shall release from escrow such documents.  If at the Closing,
Subsidiary fails to tender such Funding Note to Fannie Mae as provided in this
Section 2.3, or any of the conditions specified in Article IV shall not have
been fulfilled to Fannie Mae's satisfaction, Fannie Mae will, at its election,
be relieved of its obligation to exchange the GTCs for the Funding Note at such
Closing, without thereby waiving any other rights it may have by reason of such
failure or such nonfulfillment.

     2.4. Non-Recourse Obligation.  The Funding Note shall be a non-recourse
obligation of the Subsidiary payable solely from the Collateral to the extent
such Collateral has not been properly released from the security interest
created by this Agreement.  Neither the Parent nor any Affiliate of the Parent
(except for the Subsidiary, but only to the extent of the Collateral as provided
in the preceding sentence) nor any of their respective successors and assigns
shall be liable in any respect or under any theory (including, without
limitation, any theory based upon piercing the corporate veil of the Subsidiary)
for payments due on the Funding Note.

     2.5. Interest and Principal on the Funding Note.  The Funding Note shall
accrue interest from December 1, 1995 at the Funding Note Coupon specified
therein.  Subsidiary shall pay the interest and principal on the Funding Note on
each Quarterly Payment Date (or Special Prepayment Date, in the event of a
special prepayment of the Funding Note) in the manner specified in the Funding
Note and Sections 2.8 and 3.3 hereof.  The final Quarterly Payment Date for the
Funding Note is March 17, 2035.  So long as no Event of Default has occurred,
Fannie Mae shall remit to Subsidiary on each Quarterly Payment Date any Funding
Surplus received by it.  Upon such remittance, such Funding Surplus shall be
released from the security interest created by this Agreement.

     2.6. Optional Prepayment at Direction of Fannie Mae.  The outstanding
principal amount of the Funding Note shall become immediately due and payable,
at the option of Fannie Mae, upon not less than 60 nor more than 90 days'
notice, on any Quarterly Payment Date on or after the date on which, after
giving effect to principal payments to be made on the Funding Note on such
Quarterly Payment Date, the outstanding principal amount of the Funding Note
would be equal to or less than 1% of its original principal amount.  In such
event, the amount due and payable on the Funding Note to Fannie Mae shall be
equal to the outstanding principal amount of the Funding Note, plus accrued and
unpaid interest for the Interest Accrual Period relating to the applicable
Quarterly Payment Date ("Repurchase Price").  In order to satisfy such amount,
Fannie Mae shall liquidate a like principal amount of the Pledged Securities at
fair market value as determined by Fannie Mae, and apply the net proceeds of
such liquidation (together with funds contributed by Fannie Mae if such net
proceeds are insufficient) to pay the amount due and payable on the Funding Note
to Fannie Mae, provided, however, that Fannie Mae shall provide Subsidiary with
written notice of its intent to liquidate such Pledged Securities and the date
of such proposed liquidation not less than 10 days prior to the proposed
liquidation date specified in such notice and Subsidiary shall have the option,
in its discretion, to purchase the Funding Note and Pledged Securities at a
price equal to the Repurchase Price on or prior to the liquidation date
specified in such notice.  Upon payment of the amount due and payable pursuant
to this Section, Fannie Mae shall cause the Funding Note, any remaining Pledged
Securities and any remaining proceeds from such liquidation (net of liquidation
expenses) to be transferred to the Subsidiary, free and clear of the security
interest created by this Agreement.

     2.7. Optional Prepayment by Subsidiary.  The outstanding principal balance
of the Funding Note may be prepaid, in whole but not in part, at the option of
the Subsidiary, on any Quarterly Payment Date on or after the Quarterly Payment
Date on which, after giving effect to principal payments to be made in respect
of the Funding Note on such Quarterly Payment Date, the outstanding principal
balance of the Funding Note would be equal to or less than 20% of the original
principal balance of the Funding Note (the "Prepayment Date").  Notice of such
prepayment must be given by the Subsidiary to Fannie Mae not earlier than the
eighteenth calendar day of the month preceding the Quarterly Payment Date on
which such prepayment is to occur and not later than the sixth Business Day of
the month in which such Quarterly Payment Date occurs.  In such event, the
amount payable by the Subsidiary (the "Prepayment Amount") shall be equal to the
unpaid principal amount of the Funding Note, plus accrued and unpaid interest
for the Interest Accrual Period relating to the Prepayment Date.  In order to
effect such prepayment, the Subsidiary shall, on the date such notice is given,
deposit in the Collection Account an amount which, after giving effect to (i)
any amounts already held in such Collection Account and (ii) earnings on amounts
held in the Collection Account to the Prepayment Date at any reinvestment rate
which may be agreed upon by Fannie Mae and the Subsidiary, will be at least
equal to the Prepayment Amount.  Alternatively, if the Subsidiary, on or before
the date such notice is given, shall have entered into a forward purchase
agreement reasonably satisfactory to Fannie Mae with an institution whose
unsecured short-term debt obligations are rated at least A-1 by S&P, at least P-
1 by Moody's or at least F-1 by Fitch for the sale of a principal amount of the
Pledged Securities equal to the unpaid principal amount of the Funding Note, the
Subsidiary shall, no later than the Business Day preceding the Prepayment Date,
deposit in the Collection Account an amount (the "Required Amount") which will
be at least equal to the Prepayment Amount, after giving effect to the amounts
described in clauses (i) and (ii) of the preceding sentence, provided, however,
that if the proceeds from the sale of such Pledged Securities are less than the
Required Amount, the Subsidiary shall, no later than the date on which such
notice is given, deposit in the Collection Account an amount equal to the amount
of such deficiency.  Upon either deposit referred to in the two preceding
sentences, all funds held in the Collection Account shall be invested and
reinvested by Fannie Mae in Eligible Investments pursuant to the provisions of
Section 3.3, and the excess of funds held in such Collection Account on the
Prepayment Date over the Prepayment Amount shall be remitted by Fannie Mae to
the Subsidiary on such Prepayment Date.  In addition, upon either such deposit,
Fannie Mae shall cause the Funding Note and the Pledged Securities to be
transferred to the Subsidiary, free and clear of the security interest created
by this Agreement.

     2.8. Special Prepayment by Subsidiary.

     (a)  The Funding Note is subject to special prepayment, in whole or in
part, on any Payment Date other than a Quarterly Payment Date (a "Special
Prepayment Date") in the event Fannie Mae determines that the amount of funds in
the Collection Account expected to be available for payment of interest on the
Funding Note on the next Quarterly Payment Date could be less than the amount
required for payment of interest.

     (b)  On the sixth Business Day of each month other than a month in which a
Quarterly Payment Date occurs (a "Special Prepayment Determination Date"),
Fannie Mae shall make such determination based upon the following factors:

          (i)  distributions of principal of and interest on and, if received by
Fannie Mae and in Fannie Mae's sole discretion, mortgage prepayment premiums on,
the Pledged Securities received or due to be received through the GNMA
Distribution Date occurring in the same month and since the preceding Quarterly
Payment Date or Special Prepayment Date, whichever is later (or since the date
hereof, if no Quarterly Payment Date or Special Prepayment Date has yet
occurred); 

          (ii) the scheduled distributions (if any) of principal of and interest
on the Pledged Securities required to be made during the period following the
GNMA Distribution Date occurring in the same month and prior to the next
succeeding Quarterly Payment Date;

          (iii) the aggregate amount of interest then being earned on all
Eligible Investments held in the Collection Account; and 

          (iv) the aggregate amount of interest which would be earned through
the Business Day preceding the next Quarterly Payment Date at the Assumed
Reinvestment Rate, on the amount referred to in clause (i) above (but not clause
(ii) above) and on the principal and interest of the Eligible Investments
referred to in clause (iii) above, as and when such amounts are receivable for
deposit in the Collection Account.

     (c)  In the event such determination is made, Fannie Mae no later than one
Business Day after the Special Prepayment Determination Date, shall notify the
Subsidiary by writing or telefax that a special prepayment of the Funding Note
is required in an amount specified by Fannie Mae.  The Subsidiary, in lieu of a
special prepayment, shall have the option, in its sole discretion, to pay to
Fannie Mae for deposit in the Collection Account the amount by which payment of
interest on the next Quarterly Payment Date is determined to be insufficient. 
Payment must be received by  Fannie Mae on or before the eighth Business Day of
the month in which the determination is made.

     (d)  If the Subsidiary does not deposit funds in lieu of a special
prepayment, the Subsidiary shall make a special prepayment in the amount
specified by Fannie Mae on the Funding Note on the Special Prepayment Date
occurring in the month in which the determination to make a special prepayment
is made.  Such special prepayment of the Funding Note shall be at a prepayment
price equal to 100% of the principal amount of the portion of the Funding Note
to be prepaid, plus accrued and unpaid interest thereon through the preceding
calendar month.  The amount of any special prepayment shall be limited to the
amount of principal distributions in respect of the Pledged Securities received
since the immediately preceding Quarterly Payment Date or preceding Special
Prepayment Date, whichever is later, that would otherwise be required to be
applied to the payment of principal on the Funding Note on the next succeeding
Quarterly Payment Date.

     2.9. Prepayment and Redemption.  The Funding Note may not be prepaid or
redeemed otherwise than pursuant to Section 2.6, Section 2.7 or Section 2.8
hereof.


                                   ARTICLE III

                      COLLATERAL SECURITY FOR FUNDING NOTE

     3.1. Grant of Security Interest.  To secure the payment of the principal of
and interest on the Funding Note in accordance with its terms and the
performance of the covenants contained in the Funding Note and this Agreement,
Subsidiary hereby grants to Fannie Mae, as of the Closing, as collateral
security for the exclusive benefit of Fannie Mae and the holders of the GTCs,
all of Subsidiary's right, title and interest in and to (a) the Pledged
Securities, including all GNMA Distributions made thereon after the date hereof,
(b) the Collection Account, including all income from investment and
reinvestment of funds in the Collection Account and (c) all products and
proceeds of the foregoing, including all cash proceeds, accounts, accounts
receivable, notes, drafts, acceptances, chattel paper, checks, deposit accounts,
rights to payment of any and every kind, and other forms of obligations and
receivables which at any time constitute all or part or are included in the
proceeds of the foregoing (collectively, the "Collateral").  Subject to the
security interest granted under this Section 3.1, the Collateral shall remain
the property of Subsidiary.  Until the release of the security interest under
Section 3.3, Fannie Mae, as the holder of the Pledged Securities, shall be
entitled to make all demands on GNMA in respect of the Pledged Securities.

     3.2. Collection of Money.  Fannie Mae shall receive and collect all money
and other property payable to or receivable by Fannie Mae under the Funding
Note, including all GNMA Distributions made on the Pledged Securities.  Fannie
Mae shall apply such funds received by it as provided in this Agreement.  If any
default occurs in the making of any payment or performance under any Eligible
Investment or GNMA Security, Fannie Mae may, and upon the request and at the
expense of the Subsidiary shall, take such action as may be appropriate to
enforce such payment or performance.  Any such action shall be without prejudice
to any right to declare a default hereunder and to proceed as provided herein.

     3.3. Collection Account.

     (a)  Prior to Closing, Fannie Mae shall open with itself one or more
accounts (collectively, the "Collection Account").  The Collection Account shall
be identified on Fannie Mae's books and records as relating solely to the
Funding Note and to the Pledged Securities.  Fannie Mae shall promptly deposit
in such Collection Account all GNMA Distributions received with respect to the
Pledged Securities and all amounts received from the reinvestment of amounts on
deposit in the Collection Account.  All GNMA Distributions on the Pledged
Securities and other monies deposited from time to time in the Collection
Account, and all investments made in Eligible Investments with such monies,
including all income or other gain from such investments, shall be held by
Fannie Mae in such Collection Account subject to withdrawal by Fannie Mae for
the purpose of making payments hereunder and pursuant to the Trust Agreement.

     (b)  All or a portion of the Collection Account shall be invested and
reinvested by Fannie Mae in one or more Eligible Investments bearing interest or
sold at a discount at the direction and in the sole discretion of Fannie Mae. 
No such investment shall mature later than the Business Day immediately
preceding the next Quarterly Payment Date.  All income or other gain from
investments of monies deposited in the Collection Account shall be credited by
Fannie Mae to such Collection Account immediately upon receipt, and any loss
resulting from such investments shall be charged to such Collection Account.

     (c)  Amounts on deposit in the Collection Account shall be applied on each
Quarterly Payment Date as follows:

     first, to the payment of all interest due on the Funding Note, 

     second, to the payment of all principal due on the Funding Note, in an
     amount equal to (a) the sum of (i) the amount of principal distributions
     scheduled to be received on the Pledged Securities in the month of such
     Quarterly Payment Date (such amount being equal to the sum of (x) the
     aggregate of the amounts allocable to principal reported by GNMA in the
     latest Principal Factors prior to the 13th calendar day of such month to be
     receivable in respect of the Pledged Securities in such month and (y) in
     the case of any Pledged Security for which no Principal Factor shall have
     been so published, an assumed amortization amount calculated by Fannie Mae
     on the basis of available information in respect of the mortgage loans
     underlying such Pledged Security), (ii) the amount of principal distributed
     on the Pledged Securities in each of the two preceding months and (iii) the
     Carry-Forward Principal Amount for such Quarterly Payment Date, less (b)
     the amount of principal paid upon any special prepayment of the Funding
     Note that occurred in the two preceding months, and 

     third, unless an Event of Default shall have occurred and be continuing
     hereunder, any remaining amounts which represent Funding Surplus shall be
     remitted to the Subsidiary.  Upon remittance of any Funding Surplus to the
     Subsidiary, such Funding Surplus shall be released from the security
     interest created by this Agreement.

     (d)  Unless an Event of Default shall have occurred and be continuing
hereunder,  Fannie Mae shall, within five Business Days following each Payment
Date that is not a Quarterly Payment Date, remit to the Subsidiary from funds on
deposit in the Collection Account an amount equal to the Excess Funds, if any,
calculated with respect to the then current Due Period.  In the event any such
remittance is to be made, Fannie Mae shall so notify the Subsidiary by writing
or telefax and shall effect such remittance by wiring immediately available
funds to an account designated by the Subsidiary.  Any amount so remitted to the
Subsidiary shall be released from the security interest created by this
Agreement; provided, however, that in the event amounts are remitted to the
Subsidiary under this Section 3.3(d) in excess of the amounts required to be so
remitted, then, promptly following receipt of a written confirmation from Fannie
Mae of such overpayment, the Subsidiary shall reimburse Fannie Mae for such
overpayment by wiring immediately available funds in the amount of such
overpayment to an account designated by Fannie Mae.

     (e)  Fannie Mae shall provide reports to Subsidiary relating to all
deposits to and withdrawals from the Collection Account.  Such reports shall be
provided quarterly following each Quarterly Payment Date, or monthly following
any Special Prepayment Date.  Such reports may be provided more frequently at
the expense of the Subsidiary and otherwise upon such terms as shall be
acceptable to Fannie Mae in its reasonable discretion.

     3.4. Satisfaction; Release of Security Interest.  Upon the payment by
Subsidiary of all sums payable by Subsidiary hereunder or pursuant to the
Funding Note in accordance with the terms thereof, this Agreement (except for
the terms and provisions of Section 8.1 and Section 9.7, which shall remain in
full force and effect) shall cease to be of further effect, and Fannie Mae, on
demand of and at the expense of Subsidiary, shall execute proper instruments
acknowledging satisfaction and discharge of this Agreement and the Funding Note.

 
                                   ARTICLE IV

                              CONDITIONS TO CLOSING

     4.1. Conditions Precedent to Closing.  The obligation of Fannie Mae to
issue the GTCs to the Subsidiary in exchange for the Funding Note is subject to
Fannie Mae's determination, prior to or at the Closing, that the following
conditions have been satisfied:

          4.1.1.      Delivery of Pledged Securities.  The Pledged Securities
     shall have been delivered to (or, if in book-entry form, registered in the
     name of) an account designated by Fannie Mae free and clear of any lien,
     mortgage, pledge, charge, security interest or other encumbrance, other
     than any lien that is removed at Closing.

          4.1.2.      Absence of Material Adverse Change.  There shall not have
     occurred any material adverse change in the financial or business condition
     or prospects of Parent since the date of the most recent financial
     statement delivered pursuant to Section 4.1.10(d).

          4.1.3.      Representations and Warranties.  The representations and
     warranties of Subsidiary and Parent contained in this Agreement and those
     otherwise made in writing by or on behalf of Subsidiary and Parent in
     connection with the transactions contemplated by this Agreement shall have
     been correct when made and shall be correct at the time of the Closing.

          4.1.4.      Performance; No Default.  Subsidiary and Parent shall have
     performed and complied with all agreements and conditions contained in this
     Agreement required to be performed or complied with by them prior to the
     dates specified herein and, at the time of the Closing, no Event of Default
     shall have occurred and be continuing.

          4.1.5.      Litigation, Etc.  The consummation of the transactions
     contemplated hereby shall not be permanently, preliminarily or temporarily
     enjoined or restrained, and no litigation or other proceeding seeking any
     such injunction or restraint or other proceeding seeking any such
     injunction or restraint or otherwise challenging such transaction, shall
     have been commenced or threatened.

          4.1.6.      Compliance Certificate.  Subsidiary shall have delivered
     to Fannie Mae an Officers' Certificate, dated as of the Closing, certifying
     that the conditions specified in Section 4.1.1 and Sections 4.1.3 through
     4.1.5 have been fulfilled and Parent shall have delivered to Fannie Mae an
     Officers' Certificate dated as of the Closing, certifying that the
     conditions specified in Sections 4.1.1 through 4.1.5 have been fulfilled.

          4.1.7.      Tax Status.

               (a)    Fannie Mae shall have received from Thacher Proffitt &
                      Wood, counsel to the Parent and Subsidiary, an opinion
                      (attached as Exhibit X) in form and substance satisfactory
                      to Fannie Mae, that the Funding Note constitutes debt of
                      the Subsidiary for federal income tax purposes.

               (b)    Fannie Mae shall have received a letter from the
                      Underwriter in form and substance satisfactory to them
                      with respect to certain information regarding the
                      likelihood of special prepayments occurring, the present
                      value analysis of the equity interest retained by
                      Subsidiary based on assumptions as of pricing and the
                      reasonableness of the assumptions and the realistic
                      possibility of exercise of the optional prepayment by
                      Subsidiary.

          4.1.8.      Opinions of Counsel.  Fannie Mae shall have received from
     Thacher Proffitt & Wood and Swidler & Berlin, counsel to Parent and
     Subsidiary, favorable opinions in form and substance satisfactory to Fannie
     Mae.

          4.1.9.      Fairness Opinion.  Fannie Mae shall have received an
     opinion from the Underwriter that the price paid for the Pledged Securities
     by Subsidiary to Parent represents fair and reasonably equivalent value for
     such Pledged Securities.

          4.1.10.     Closing Papers.  At or prior to the Closing, Subsidiary or
     Parent, as the case may be, shall have delivered to Fannie Mae the
     following documents to be held in escrow by Fannie Mae until the Closing:

               (a)    The Funding Note, in the form of Exhibit A, duly executed
                      by Subsidiary.

               (b)    Evidence of the assignment and the transfer of the Pledged
                      Securities from Parent to Subsidiary pursuant to the terms
                      of the Assignment and Agreement.

               (c)    Evidence of filing of a financing statement.

               (d)    A copy of Parent's most recent full-year financial
                      statements (consolidated, if applicable) filed with the
                      Securities and Exchange Commission, and any subsequent
                      interim financial statements so filed, all of which shall
                      be prepared in accordance with generally accepted
                      accounting principles.

               (e)    Certified copies of the Governing Instruments of the
                      Parent and the Subsidiary and such resolutions of the
                      Board of Directors of Subsidiary and Parent and such other
                      corporate documents of Subsidiary and Parent as Fannie Mae
                      reasonably may request.

               (f)    Certificates of good standing of Parent and Subsidiary,
                      dated not more than 14 days prior to the Closing.

               (g)    Certified copies of the resolutions adopted by the Board
                      of Directors of each of Subsidiary and Parent authorizing
                      the execution, delivery and performance of this Agreement,
                      the Funding Note and each of the other agreements,
                      instruments and transactions contemplated hereby.

               (h)    A certificate of the Secretary or Assistant Secretary of
                      each of Subsidiary and Parent, dated the Closing, as to
                      the incumbency and signatures of the Officers of
                      Subsidiary or Parent, as the case may be, authorized to
                      act with respect to this Agreement and all instruments
                      executed pursuant thereto.

               (i)    Such other documents, certificates and resolutions as
                      Fannie Mae may reasonably request.

          4.1.11.     Conversion Fee.  Fannie Mae shall have received from
     Parent a payment in the amount of $350,000 representing the conversion fee
     payable to Fannie Mae in consideration of its issuance and guarantee of the
     GTCs and related duties, obligations and responsibilities performed and to
     be performed by Fannie Mae in connection therewith.  Such payment shall be
     made in immediately available funds wired to Fannie Mae's account at the
     Federal Reserve Bank of New York in accordance with the following wire
     instructions: FNMANYC/GEN, ABA #021039500, Re: 1995-T5.

          4.1.12.     Proceedings.  All corporate and other proceedings taken or
     to be taken in connection with the transactions contemplated by this
     Agreement and all documents and instruments incidental to such transactions
     will be satisfactory in form and substance to Fannie Mae, and Fannie Mae
     will have received all such counterpart originals or certified or other
     copies of such documents as it may reasonably request.


                                    ARTICLE V

                         REPRESENTATIONS AND WARRANTIES

     5.1. Representations and Warranties of Fannie Mae.  Fannie Mae represents
and warrants to Parent and Subsidiary as follows:

          5.1.1.      Organization.  Fannie Mae is a corporation duly organized
     and validly existing under the laws of the United States, with power and
     authority to conduct its business as it is currently being conducted and to
     enter into and perform its obligations under this Agreement and the Trust
     Agreement.

          5.1.2.      Authorization.  The execution, delivery and performance of
     this Agreement and the Trust Agreement have been duly authorized by all
     necessary action of Fannie Mae, and this Agreement and the Trust Agreement
     each constitute the valid, legal and binding agreement of Fannie Mae,
     enforceable in accordance with its terms subject, as to enforcement of
     remedies, to applicable bankruptcy, reorganization, moratorium, insolvency
     or other similar laws affecting creditors' rights generally from time to
     time in effect and to general principles of equity (regardless of whether
     enforcement is brought in a proceeding in equity or at law).  The issuance
     and sale of the GTCs have been duly authorized by all necessary action of
     Fannie Mae.

          5.1.3.      No Violation; Conflicts.  The execution and delivery by
     Fannie Mae of this Agreement and the Trust Agreement, the performance by
     Fannie Mae of its obligations hereunder and thereunder and the consummation
     of the transactions contemplated hereby and thereby will not (a) conflict
     with or result in a breach of, or constitute a default under, any of the
     provisions of Fannie Mae's charter, or to its knowledge, any law, rule or
     regulation, or any judgment, decree or order applicable to Fannie Mae or
     any of its properties, or (b) violate, or conflict with, or result in a
     breach of any provision of, or constitute a default (or an event which,
     with or without due notice or lapse of time, or both, would constitute a
     default) under, or give rise to any right of termination, cancellation or
     acceleration of any obligation or the surrender of a material benefit
     under, any note, bond, mortgage, indenture, deed of trust, license, lease,
     agreement or other instrument or obligation by which Fannie Mae is bound.

     5.2. Representations and Warranties of Subsidiary and Parent.  Parent with
respect to itself and Subsidiary, and Subsidiary with respect to itself, each
represent and warrant to Fannie Mae as follows:

          5.2.1.      Organization, Good Standing.  Each of Subsidiary and
     Parent has been duly organized and is validly existing and in good
     standing, under the applicable laws of the jurisdiction of its formation,
     and is duly qualified to do business in and is in good standing under the
     laws of each jurisdiction which requires such qualification, other than any
     jurisdictions in which the failure to qualify would not have a material
     adverse effect on either Parent's or Subsidiary's properties or business. 
     Each of Subsidiary and Parent has full power and authority to own its
     properties and conduct its business as presently conducted.  Subsidiary
     holds all franchises, licenses, certificates and permits from all
     governmental authorities necessary in all material respects for the conduct
     of its business as currently conducted.

         5.2.2.      No Violation; Conflicts.  The execution and delivery by
     Subsidiary and Parent of this Agreement, the Funding Note and other Series
     Documents (as applicable), the performance by Subsidiary and Parent of
     their respective obligations hereunder and thereunder and the consummation
     of the transactions contemplated hereby and thereby will not (a) conflict
     with or result in a breach of, or constitute a default under, any of the
     provisions of the Governing Instruments of Subsidiary or Parent, or any
     law, rule or regulation, or any judgment, decree or order applicable to
     Subsidiary or Parent or any of their properties, or (b) violate, or
     conflict with, or result in a breach of any provision of, or constitute a
     default (or an event which, with or without due notice or lapse of time, or
     both, would constitute a default) under, or give rise to any right of
     termination, cancellation or acceleration of any obligation or to of a
     material benefit under, any note, bond, mortgage, indenture, deed of trust,
     license, lease, agreement or other instrument or obligation by which Parent
     or Subsidiary is bound or (except as contemplated hereby) result in the
     creation of any lien, security interest, charge or other encumbrance upon
     any of the properties of the Subsidiary or Parent.

          5.2.3.      Authorization.  Each of this Agreement, the Funding Note,
     and all other Series Documents, when executed and delivered as contemplated
     hereby, will have been duly executed and delivered by Subsidiary or Parent
     (as applicable) and will constitute, when so executed and delivered, the
     legal, valid and binding agreement of Subsidiary or Parent (as applicable),
     enforceable in accordance with its terms subject, as to enforcement of
     remedies, to applicable bankruptcy, reorganization, moratorium, insolvency
     or other similar laws affecting creditors' rights generally from time to
     time in effect and to general principles of equity (regardless of whether
     enforcement is brought in a proceeding in equity or at law).

          5.2.4.      Consents.  Parent has filed all applications and notices
     and received all consents and authorizations as are required under federal
     and state law to organize Subsidiary and transfer thereto all its right,
     title and interest in and to the Pledged Securities, and Parent and
     Subsidiary have each filed all applications and notices and received all
     consents and authorizations as are required under federal and state law and
     all other applicable governmental rules to enter into and perform the
     transactions contemplated by the Assignment and Agreement and this
     Agreement and, in the case of Subsidiary, the Funding Note other than, in
     the case of Parent, any consents, authorizations, applications and notices
     that, if not so obtained or filed, would not have a material adverse effect
     on the Parent's right, title and interest in and to the Pledged Securities
     or its ability to enter into and perform such transactions.  No further
     consent, approval, authorization or order of any court or governmental
     agency or body or any private party is required for consummation by Parent
     or Subsidiary of the transactions contemplated by the Assignment and
     Agreement, this Agreement or the Funding Note.

          5.2.5.      Litigation, Proceedings, etc.  There are no actions,
     suits, proceedings or other litigation pending or, to the knowledge of
     Subsidiary or Parent, threatened against Subsidiary which could affect the
     ability of Subsidiary to perform its obligations under this Agreement and
     the other Series Documents.  There are no actions, suits, proceedings or
     other litigation pending or, to the knowledge of Parent, threatened against
     Parent, or any other subsidiary of Parent, at law or in equity, or before
     or by any federal, state or municipal agency or other instrumentality or
     other governmental authority, which could materially and adversely affect
     the ability of parent to perform its obligations under this Agreement and
     the other Series Documents.

          5.2.6.      Compliance with Laws.  Each of Parent and Subsidiary is
     not subject to, and has not been threatened to its knowledge with, any
     fine, penalty or disability as the result of its failure to comply with any
     requirements of federal, state, local or foreign law or regulation or other

     governmental rule or of any governmental body or agency having jurisdiction
     over it, the conduct of its business or the use of its assets.

          5.2.7.      Capital Stock.  Parent owns directly all the outstanding
     capital stock of Subsidiary.  No Person has any direct or indirect right to
     acquire any capital stock of Subsidiary.  Parent has heretofore furnished
     to Fannie Mae and the Underwriter true and correct copies of the Governing
     Instruments of Subsidiary as in effect on the date hereof.

          5.2.8.      Solvency, etc.  Each of Parent and Subsidiary is Solvent,
     and neither Parent nor Subsidiary is, and with the passage of time neither
     expects to become, Bankrupt.

          5.2.9.      Disclosure.  There is no material fact that Subsidiary or
     Parent has not disclosed to Fannie Mae which would have a Material Adverse
     Effect.  No information, report, financial statement or certificate
     delivered to Fannie Mae in connection with this Agreement or the Funding
     Note relating to historical events or conditions contains any untrue
     statement of a material fact or omitted or omits to state a material fact
     necessary to make such statements not misleading in light of the
     circumstances in which such statements were made.

          5.2.10.     Pledged Securities.  In the case of all Pledged
     Securities:

               (i)    On or prior to the Closing, Parent will be the owner of
               the Pledged Securities free and clear of any lien, mortgage,
               pledge, charge, security interest or other encumbrance, except
               any lien released concurrently with the disposition of the
               Pledged Securities by Parent.

               (ii)   On the Closing Date, upon the transfer of the Pledged
               Securities to Subsidiary, Subsidiary will be the owner of the
               Pledged Securities free and clear of any lien, mortgage, pledge,
               charge, security interest or other encumbrance, except the lien
               of this Agreement and the Funding Note and any lien released
               concurrently with the acquisition of the Pledged Securities by
               Subsidiary, and at the time of Closing, Fannie Mae shall be the
               pledgee of such Pledged Securities.

               (iii)  Subsidiary will acquire the Pledged Securities in good
               faith and without notice of any adverse liens or claims,
               including, any federal tax liens or liens arising under the
               Employee Retirement Income Security Act of 1974, as amended.  No
               portion of the Pledged Securities will have been purchased by the
               Subsidiary with collateral or proceeds of collateral subject to
               the security interest of any third party.

               (iv)   The information set forth with respect to the Pledged
               Securities in Schedule 1 to this Agreement is correct.

               (v)    With respect to information set forth on "Exhibit A" to
               the Fannie Mae prospectus for the GTCs, dated October 23, 1995
               relating to the "GNMA Securities" and "Mortgages" (each as
               defined such prospectus) which underlie the Pledged Securities:

                      (a)     except as provided in subsections (b) and (c)
                      below, the information is correct in all material
                      respects;

                      (b)     information in the applicable footnote relating to
                      Section 8 rent subsidies was obtained from the Department
                      of Housing and Urban Development and accurately reflects
                      the information so obtained; and

                      (c)     information under each of the headings "Mortgage
                      Interest Rate" and "Lockout End Date" was calculated based
                      upon publicly available information, the calculations used
                      to produce such information were reasonable and such
                      information as so calculated is correct in all material
                      respects.

               (vi)   As of the Closing, each Pledged Security shall have been
               duly and validly assigned to Fannie Mae and duly and validly
               transferred to or deposited in an account designated by Fannie
               Mae; and Fannie Mae shall have a duly and validly perfected
               security interest in each such Pledged Security subject to no
               prior lien, mortgage, security interest, pledge, charge or other
               encumbrance.

          5.2.11.     Legal Counsel, etc.  Each of Parent and Subsidiary has
     consulted with its own legal counsel and independent accountants to the
     extent it deems necessary regarding the tax, accounting and regulatory
     consequences of the transactions contemplated here, and neither Parent nor
     Subsidiary is participating in such transactions in reliance on any
     representations of Fannie Mae, the Underwriter, or their counsel with
     respect to tax, accounting or regulatory matters  (other than the fairness
     opinion delivered pursuant to Section 4.1.9 hereof).

          5.2.12.     Separate Existence.  Subsidiary has taken all action
     necessary under applicable law to establish and maintain a separate
     existence from Parent and its affiliates including the actions set forth in
     Section 6.2.9.

          5.2.13.     Establishment of Subsidiary.  Parent has been duly
     authorized to establish Subsidiary and to transfer all of its right, title
     and interest in and to the Pledged Securities to Subsidiary, has complied
     with all applicable laws, rules and regulations in connection with the
     establishment and operation of, and transactions and agreements with
     respect to, Subsidiary, and owns 100% of the outstanding capital stock of
     Subsidiary.

The Underwriter may rely on the foregoing representations and warranties as if
they were made to the Underwriter.  The Underwriter and any person which
controls such Underwriter are hereby made third party beneficiaries of the
foregoing representations and warranties in consideration of, and as an
inducement to, the Underwriter's purchase of the GTCs from Subsidiary.


                                   ARTICLE VI

                                    COVENANTS

     6.1. Covenants of Fannie Mae.  Fannie Mae covenants that it shall hold its
entire right, title and interest in and to the Funding Note and this Agreement
(except for its rights to indemnification under Section 8.1) on behalf of Fannie
Mae and the holders of the GTCs, and no such right, title or interest in and to
the Funding Note or this Agreement shall be held otherwise or assigned by Fannie
Mae except pursuant to the Trust Agreement.

     6.2. Covenants of Subsidiary.  Subsidiary covenants as follows:

          6.2.1.      Corporate Existence.  Subsidiary will do or cause to be
     done all things necessary to preserve and keep in full force and effect its
     corporate existence and shall continue to be in good standing under the
     laws of the state of its organization.

          6.2.2.      Performance.  Subsidiary will perform all of the terms of
     the Funding Note.

          6.2.3.      Security Interest.  Subsidiary will from time to time
     execute and deliver all supplements and amendments hereto and all financing
     statements, continuation statements, instruments of further assurance and
     other instruments, and will take such other action as Fannie Mae deems
     necessary or advisable, to

          (a)  grant more effectively all or any portion of the Collateral as
               security for the Funding Note,

          (b)  maintain or preserve the lien provided for by this Agreement and
               the Funding Note or carry out more effectively the purposes
               hereof and thereof,

          (c)  perfect, publish notice of, or protect the validity of the
               security interest granted to Fannie Mae pursuant to this
               Agreement, 

          (d)  enforce Fannie Mae's rights as pledgee of the Collateral,

          (e)  enforce this Agreement and the Funding Note, and 

          (f)  preserve and defend title to the Collateral granted hereunder and
               the rights of Fannie Mae thereto against the claims of all
               persons.

Subsidiary hereby appoints Fannie Mae as its agent and attorney-in-fact to
execute any financing statement, continuation statement or other instrument
required by Fannie Mae pursuant to this Section.  Such appointment is
irrevocable, includes full power of substitution and resubstitution and is
coupled with an interest.

          6.2.4.      Encumbrances.  Subsidiary will not (i) sell, transfer,
     exchange, dispose of or otherwise allow the encumbrance of any of the
     Collateral except as expressly permitted by this Agreement or (ii) claim
     any credit on, or make any deduction on, principal, or interest payable
     with respect to the Funding Note by reason of the payment of any taxes
     levied or assessed on the Collateral.

          6.2.5.      Taxes.  Subsidiary will pay or cause to be paid any
     federal, state or local taxes levied on account of the ownership by it of
     the Collateral.

          6.2.6.      Compliance With Laws, etc.  Subsidiary will comply at all
     times and in all material respects during the term of the Funding Note with
     all applicable laws, regulations and other governmental rules.

          6.2.7.      Examination of Records, etc.  Subsidiary, on reasonable
     prior notice, will permit any representative of Fannie Mae, during normal
     business hours, to examine all the books of account, records, reports and
     other papers of Subsidiary, to make copies and extracts therefrom, to cause
     such books to be audited by independent certified public accountants
     selected by Fannie Mae, and to discuss its affairs, finances and accounts
     with its officers, employees and independent certified public accountants
     (and by this provision Subsidiary hereby authorizes its accountants to
     discuss with such representative such affairs, finances and accounts), all
     at such reasonable times and as often as may be reasonably requested.  Any
     expense incident to the exercise by Fannie Mae of any right under this
     Section 6.2.7 will be borne by Fannie Mae, provided that if an audit is
     made during the continuance of an Event of Default, the expense incident to
     such audit shall be borne by Subsidiary.

          6.2.8.      Restriction on Additional Indebtedness.  Subsidiary will
     not create, incur, issue, assume, guarantee or otherwise become directly or
     indirectly liable with respect to any Indebtedness other than the Funding
     Note.

          6.2.9.      Additional Covenants Regarding Independence of Subsidiary.
     Subsidiary shall observe the formal legal requirements of a separate and
     independent corporation.  The directors of Subsidiary will act
     independently and in the interests of the Subsidiary.

          6.2.10.     Governing Instruments.  Subsidiary will comply at all
     times during the term of the Funding Note with each and every provision of
     Subsidiary's Governing Instruments and will not amend or otherwise change
     its Governing Instruments except as permitted therein and with the approval
     of Fannie Mae.

     6.3. Covenants of Parent.  Parent covenants as follows:

          6.3.1.      Subsidiary's Performance.  Parent will cause the
     Subsidiary to perform all its covenants and agreements contained in Section
     6.2.

          6.3.2.      Bankruptcy.  Parent will not file any bankruptcy petition
     against Subsidiary or otherwise take action to cause Subsidiary to become
     Bankrupt.

          6.3.3.      Compliance with Laws, etc.  Parent will at all times and
     in all material respects during the term of the Funding Note comply with
     all applicable laws, regulations and other governmental rules.

     6.4. Tax-Related Provisions.

          6.4.1.      Consistent Performance.  Parent and Subsidiary shall treat
     the Funding Note as debt of the Subsidiary for all tax return, tax
     information reporting and financial statement reporting purposes and shall
     not take any action inconsistent with, or to call into question or to
     negate, the treatment of the Funding Note as debt for federal income tax
     purposes.

          6.4.2.      Providing Information.  Parent and Subsidiary shall make
     available to Fannie Mae in a timely and accurate fashion any information
     necessary or appropriate in order for Fannie Mae to fulfill its tax
     information reporting obligations with respect to the GTCs.  The tax
     reporting information for each calendar year shall be provided to Fannie
     Mae's Director of Corporate Taxes, Office of the Controller on or before
     January 15 of the year following the calendar year.  The information shall
     be prepared in a format acceptable to ITR and contain all the necessary
     items of income and deduction to be reported to Holders of the GTCs.  Such
     information shall include the information required to be furnished pursuant
     to Reg. 1.6049-7 of the Income Tax Regulations.  Parent shall make
     available to Fannie Mae, at no charge, documentation to enable ITR to
     perform a detailed review of the tax reporting information, if requested. 
     If errors are found in the tax reporting information supplied by Parent,
     Parent shall reimburse Fannie Mae for all costs incurred in filing amended
     Forms K-1 due to the error.  If the tax reporting information provided by
     Parent is late and/or inaccurate, Fannie Mae shall have the option to
     prepare the tax reporting information or engage another party to prepare
     the tax reporting information, in either case, at Parent's expense.


                                  ARTICLE VII

                              DEFAULTS AND REMEDIES

     7.1. Events of Default.  An "Event of Default" occurs if:

     (a)  Subsidiary defaults in the payment of interest or principal on the
          Funding Note in accordance with Section 2.5 of this Agreement.

     (b)  Subsidiary or Parent fails to comply with any of its agreements or
          covenants in, or provisions of, the Funding Note or this Agreement,and
          the default continues for a period of 10 days after written notice
          shall have been given to the Subsidiary or the Parent by Fannie Mae.

     (c)  Subsidiary shall become Bankrupt.

     7.2. Remedies.  If an Event of Default occurs and is continuing, Fannie Mae
may do any one or more of the following:

     (a)  Declare the Funding Note immediately due and payable and take
          ownership of and, subject to the further provisions of this Section
          7.2, sell the Pledged Securities and apply the proceeds toward
          repayment in full of the Funding Note.  Notwithstanding any such
          declaration of acceleration of the Funding Note, Fannie Mae shall
          retain indefinitely the Pledged Securities unless Fannie Mae, in its
          sole judgment, determines that (a) the Pledged Securities would not
          continue to provide sufficient funds for the payment of principal and
          interest on the Funding Note as such principal and interest would have
          become due if there had not been such a declaration or (b) such
          retention would be likely to (i) subject to tax the arrangement by
          which the GTCs and/or Funding Note are issued and outstanding or (ii)
          violate applicable laws.  So long as Fannie Mae retains the Pledged
          Securities, it shall apply distributions to the Funding Note as if the
          Funding Note had not been declared immediately due and payable.  In
          the event that, following a declaration of acceleration of the Funding
          Note, Fannie Mae, in its sole judgment, determines that (a) the
          Pledged Securities would not continue to provide sufficient funds for
          the payment of principal and interest on the Funding Note as such
          principal and interest would have become due if there had not been
          such a determination or (b) such retention would be likely to (i)
          subject to tax the arrangement by which the GTCs and/or Funding Note
          are issued and outstanding or (ii) violate applicable laws, Fannie Mae
          may, but will not be required to, sell the Pledged Securities.  The
          proceeds of any such sale will be applied to payments on the Funding
          Note in the same manner as prepayments on the Pledged Securities.

     (b)  Retain in satisfaction of any amounts owing from the Subsidiary, any
          Funding Surplus otherwise required to be remitted to the Subsidiary
          pursuant to Section 3.1.

     (c)  If the Event of Default hereunder relates to the Subsidiary's payments
          of principal of or interest on the Funding Note, in whole or in part,
          require that the Subsidiary pay Fannie Mae all loss, cost and expense
          incurred by Fannie Mae as a result of the timing of such payment.

     (d)  Pursue any available remedy by proceeding at law or in equity as may
          appear necessary or desirable (i) to collect amounts owed pursuant to
          the Funding Note and any other payments then due and thereafter to
          become due under the Funding Note or (ii) to enforce the performance
          and observance of any obligation, covenant, agreement or provision
          contained in this Agreement to be observed or performed by Subsidiary
          or Parent.



    7.3. Additional Remedies.  In addition to the above remedies, if Subsidiary
commits a breach, or threatens to commit a breach of this Agreement, Fannie Mae
shall have the right and remedy, without posting bond or other security, to have
the provisions of this Agreement specifically enforced by any court having
equity jurisdiction, it being acknowledged that any such breach or threatened
breach will cause irreparable injury to Fannie Mae that money damages will not
provide an adequate remedy thereto.

     7.4. No Remedy Exclusive.  No remedy herein conferred or reserved to Fannie
Mae is intended to be exclusive of any other available remedy or remedies, but
each and every such remedy shall be cumulative and shall be in addition to every
other remedy given under this Agreement or now or hereafter existing at law or
in equity or by statute.  A delay or omission to exercise any right or power
accruing upon any default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default.  Any such right and power may
be exercised from time to time and as often as may be deemed expedient.  No
remedy is exclusive of any other remedy.  All remedies are cumulative to the
extent permitted by law.  In order to entitle Fannie Mae to exercise any remedy
reserved to it in this Article VII, it shall not be necessary to give notice,
other than such notice as may be required in this Article VII.


                                  ARTICLE VIII

                                 INDEMNIFICATION

     8.1. Indemnification.  Each of Subsidiary and Parent hereby agrees to
indemnify and hold harmless Fannie Mae, its directors, officers, agents and
employees, and each other person controlling Fannie Mae, within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act (each
an "Indemnified Party"), from and against any and all losses, claims, damages,
liabilities and expenses any of them may incur (including any attorneys' fees)
("Losses and Expenses") caused by any breach by Subsidiary or Parent of its
representations, warranties, or covenants in this Agreement, the Funding Note,
the other Series Documents or in any other documents executed in connection
herewith, including any losses, claims, damages, liabilities and expenses
resulting from (a) the failure of Subsidiary or parent to file all applications
and notices, obtain all necessary consents and authorizations to establish
Subsidiary, to execute this Agreement, the Funding Note or other Series
Document, or to comply with any conditions imposed on any such consents or
authorizations by the applicable government agency, (b) the failure of
Subsidiary or Parent to file all notices as are required to perfect the security
interest of Fannie Mae in the Collateral, and (c) the existence of any state of
facts different from any state of facts represented or warranted by Parent or
Subsidiary hereunder or under any other Series Documents.

     8.2. Contribution.  If, for any reason, indemnification is unavailable to
any Indemnified Party or insufficient to hold it harmless as contemplated by
Section 8.1, then Subsidiary or Parent shall contribute to the amount paid or
payable by the Indemnified Party as a result of such loss, claims, damage or
liability in such proportion as is appropriate to reflect not only the relative
benefits received by Parent or Subsidiary, on the one hand, and Fannie Mae, on
the other hand, but also the relative fault of Parent or Subsidiary, as the case
may be, and Fannie Mae, as well as any other relevant equitable consideration.


                                   ARTICLE IX

                                  MISCELLANEOUS

     9.1. Notices.  All notices, consents and other communications provided for
hereunder shall be in writing (including facsimile, telegraphic or cable
communication) and telecopied, telegraphed, telexed, cabled or delivered and
addressed as follows:

          (i)  If to Fannie Mae:

               Federal National Mortgage Association
               3900 Wisconsin Avenue, N.W.
               Washington, D.C.  20016-2899
               Attention: 
               Telecopy: 
               Confirmation Number: 

          (ii) If to the Subsidiary:

               CRIIMI MAE Financial Corporation III
               The CRI Building
               11200 Rockville Pike
               Rockville, MD 20852
               Attention: Chief Financial Officer
               (With a copy to the Parent)
               Telecopy: (301) 231-0334
               Confirmation Number: (301) 231-0269

          (iii)       If to the Parent:

               CRIIMI MAE INC.
               The CRI Building
               11200 Rockville Pike
               Rockville, MD 20852
               Attention: Chief Financial Officer
               (With a copy to the Subsidiary)
               Telecopy: (301) 231-0334
               Confirmation Number: (301) 231-0269

          (iv) If to the Underwriter:

               Donaldson, Lufkin & Jenrette
                 Securities Corporation
               140 Broadway
               New York, NY  10005
               Attention:
               Telecopy:
               Confirmation Number:


Any party may alter the address to which communications or copies are to be sent
by giving written notice of such change of address in conformity with the
provisions of this Section 9.1 for the giving of notice.  All such notices,
consents and other communications shall, when telecopied, telegraphed, telexed
or cabled, be effective when received.

     9.2. Parties Entitled to Benefit, etc.  This Agreement together with all
Schedules, Exhibits and other documents and instruments referred to herein or
attached hereto, shall be binding upon, and inure to the benefit of the parties
hereto (and, in the case of Sections 5.2 and 9.1, to the benefit of the
Underwriter) and their respective successors, personal representatives and
permitted assigns.  All the understandings, covenants and agreements contained
herein are solely for the benefit of such parties and their respective
successors and permitted assigns, and there are no other persons that are
intended to be benefited by, or entitled to enforce, any provision of this
Agreement except as expressly provided herein.

     9.3. Transfer and Assignment.  No party to this Agreement may transfer or
assign its rights or obligations hereunder to any Person other than as
contemplated by this Agreement, without the prior written consent of each other
party hereto.


     9.4. Entire Agreement; Amendments; Severability of Provisions.  This
Agreement, together with all Schedules, Exhibits and other documents or
instruments referred to herein or attached hereto, contains the entire agreement
of the parties hereto and supersedes all prior agreements and understanding,
oral or otherwise, among the parties hereto with respect to the matters
contained herein.  This Agreement may not be modified or amended other than by
an agreement in writing signed by the parties hereto, (and, in the case of
Sections 5.2 and 9.1, an agreement in writing signed by the Underwriter).  If
any provision of this Agreement or the application thereof to any Person or
circumstance is invalid or unenforceable, or contravenes any law, regulations or
document applicable to such Person, such provision or application shall be
deemed ineffective, but the remainder of this Agreement and the application of
such provision to other Persons or circumstances shall not be affected thereby,
and the provisions of this Agreement shall be severable in any such instances.

     9.5. Governing Law.  This Agreement shall be governed by the interpretation
and construed in accordance with the laws of the United States.  Insofar as
there may be no applicable precedent, and insofar as to do so would not
frustrate the purpose of Title III of the Emergency Home Finance Act of 1970 or
any provision of this Agreement or the transactions governed thereby, the laws
of the State of New York (excluding principles of conflict of laws) shall be
deemed reflective of the laws of the United States.

     9.6. No Waiver; Remedies.  No failure on the part of any party to this
Agreement to exercise, and no delay in exercising, any right thereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise thereof or the exercise
of any other right.  No waiver shall be effective unless it is in writing and is
signed by the party asserted to have granted such waiver.  The remedies therein
provided are cumulative and not exclusive of any remedies provided by law.

     9.7. Costs and Expenses.  Each party hereto shall bear its own costs and
expenses (including the fees and disbursements of counsel and accountants)
incurred in connection with the negotiation and preparation of and the
settlement under this Agreement and all matters incident thereto, except as
otherwise provided herein.

     9.8. Execution of Counterparts.  This Agreement may be executed in any
number of counterparts or in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.  One or more counterparts of this
Agreement (or portions hereof) may be delivered via facsimile, with the
intention that they shall have the same effect as an original counterpart hereof
(or such portions hereof).  All signatures need not be on the same counterpart.

     9.9. Survival of Representations, Warranties and Covenants.  The
representations, warranties and covenants contained in this Agreement and those
made in or resulting from any certificates, instruments or other documents
delivered pursuant to this Agreement shall survive execution, delivery and
settlement of this Agreement or any such certificate, instrument or other
document and shall continue until the satisfaction and discharge of this
Agreement as provided in Section 3.4 or until such other time as is provided in
Section 3.4.


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


FEDERAL NATIONAL MORTGAGE ASSOCIATION


By:  /s/
     --------------------------------
Name:
Title:


CRIIMI MAE INC.



By:  /s/ Cynthia O. Azzara
     ------------------------
Name:  Cynthia O. Azzara
Title: Senior Vice President
       Chief Financial Officer


CRIIMI MAE FINANCIAL CORPORATION III



By:  /s/ Cynthia O. Azzara
     -----------------------------
Name:  Cynthia O. Azzara
Title: Senior Vice President
       Chief Financial Officer