<PAGE>

                              SERIES 1997-B SUPPLEMENT

                             dated as of June 19, 1997

                                         to

                             SPREAD ACCOUNT AGREEMENT

                            dated as of March 25, 1993,

                              as amended and restated

                                as of June 1, 1997

                                       among

                              ARCADIA FINANCIAL LTD.

                         ARCADIA RECEIVABLES FINANCE CORP.

                         FINANCIAL SECURITY ASSURANCE INC.

                            THE CHASE MANHATTAN BANK 

                                       and

                   NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,

<PAGE>

                                
                                  TABLE OF CONTENTS

                                                                            Page


ARTICLE I

                                   DEFINITIONS . . . . . . . . . . . . . . .  2
     Section 1.1  Definitions. . . . . . . . . . . . . . . . . . . . . . . .  2
     Section 1.2  Rules of Interpretation. . . . . . . . . . . . . . . . . .  5

ARTICLE II

           CREDIT ENHANCEMENT FEE; SERIES SUPPLEMENTS; THE COLLATERAL. . . .  5
     Section 2.1  Series 1997-B Credit Enhancement Fee . . . . . . . . . . .  5
     Section 2.2  Series Supplements . . . . . . . . . . . . . . . . . . . .  6
     Section 2.3  Grant of Security Interest by Arcadia Financial 
                  and the Seller . . . . . . . . . . . . . . . . . . . . . .  6

ARTICLE III

                                 SPREAD ACCOUNT. . . . . . . . . . . . . . .  7
     Section 3.1  Establishment of Series 1997-B Spread Account; Initial      
                  Deposit into Series 1997-B Spread Account. . . . . . . . .  7
     Section 3.2  Spread Account Additional Deposits . . . . . . . . . . . .  7
     
                                   ARTICLE IV

                                  MISCELLANEOUS. . . . . . . . . . . . . . .  7
     Section 4.1  Further Assurances . . . . . . . . . . . . . . . . . . . .  7
     Section 4.2  Governing Law  . . . . . . . . . . . . . . . . . . . . . .  8
     Section 4.3  Counterparts . . . . . . . . . . . . . . . . . . . . . . .  8
     Section 4.4  Headings . . . . . . . . . . . . . . . . . . . . . . . . .  8

     Schedule I



<PAGE>


                            SERIES 1997-B SUPPLEMENT

     SERIES 1997-B SUPPLEMENT, dated as of June 19, 1997 (the "Series 1997-B 
Supplement"), by and among ARCADIA FINANCIAL LTD., a Minnesota corporation 
("Arcadia Financial"), ARCADIA RECEIVABLES FINANCE CORP., a Delaware 
corporation (the "Seller"), FINANCIAL SECURITY ASSURANCE INC., a New York 
stock insurance company ("Financial Security"), THE CHASE MANHATTAN BANK, a 
national banking association, in its capacity as Indenture Trustee under the 
Indenture and NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION as Collateral 
Agent hereunder. 

                                    RECITALS

     1.  The parties hereto have previously entered into a Spread Account 
Agreement, dated as of March 25, 1993, as amended and restated as of June 1, 
1997 (the "Spread Account Agreement"), and, as contemplated by Section 2.02 
of the Spread Account Agreement, this Series 1997-B Supplement constitutes a 
Series Supplement to the Spread Account Agreement so that hereafter this 
Series 1997-B Supplement shall form a part of the Spread Account Agreement 
for all purposes thereof, and all references herein and hereafter to the 
Spread Account Agreement shall mean the Spread Account Agreement, as 
supplemented hereby.

     2.  Arcadia Automobile Receivables Trust, 1997-B (the "Series 1997-B 
Trust") is being formed contemporaneously herewith pursuant to the Series 
1997-B Trust Agreement (as defined herein).

     3.  Pursuant to the Series 1997-B Sale and Servicing Agreement, the 
Seller is selling to the Series 1997-B Trust all of its right, title and 
interest in and to the Initial Receivables (as defined in the Series 1997-B 
Sale and Servicing Agreement) and certain other Trust Property (as defined in 
the Series 1997-B Trust Agreement).

     4.  Pursuant to the Series 1997-B Indenture, the Series 1997-B Trust is 
issuing the Series 1997-B Notes (as defined herein).

     5.  The Seller has requested that Financial Security issue the Series 
1997-B Note Policy to the Trustee to guarantee payment of the Scheduled 
Payments (as defined in such Policy) on each Payment Date in respect of the 
Series 1997-B Notes.

     6.  In partial consideration of the issuance of the Series 1997-B Note 
Policy, the Seller has agreed that Financial Security shall have certain 
rights as Controlling Party, to the extent set forth in the Spread Account 
Agreement and the Series 1997-B Indenture.

     7.  The Seller is a wholly owned special purpose subsidiary of Arcadia 
Financial.  The Series 1997-B Trust has agreed to pay the Series 1997-B 
Credit Enhancement Fee to the Seller in consideration of the obligations of 
the Seller and Arcadia Financial pursuant hereto and in consideration of the 
obligations of Arcadia Financial pursuant to the Series 1997-B Insurance 
Agreement (such obligations forming part of the Series 1997-B Insurer Secured 
Obligations as
                                                     

<PAGE>

referred to herein).  The Series 1997-B Insurer Secured Obligations form part 
of the consideration to Financial Security for its issuance of the Series 
1997-B Policies.

     8.  In order to secure the performance of the Series 1997-B Secured 
Obligations, to further effect and enforce the subordination provisions to 
which the Series 1997-B Credit Enhancement Fee is subject, and in 
consideration of the receipt of the Series 1997-B Credit Enhancement Fee, 
Arcadia Financial and the Seller have agreed to pledge the Series 1997-B 
Collateral as Collateral to the Collateral Agent for the benefit of Financial 
Security and for the benefit of the Trustee on behalf of the Trust, upon the 
terms and conditions set forth herein.

                                   AGREEMENTS

     In consideration of the premises, and for other good and valuable 
consideration, the adequacy, receipt and sufficiency of which are hereby 
acknowedged, the parties hereto agree as follows:
 
                                    ARTICLE 1 

                                   DEFINITIONS

     Section 1.1  DEFINITIONS.  All terms defined in Section 1.1 of the 
Series 1997-B Sale and Servicing Agreement shall have the same meaning with 
respect to this Series 1997-B Supplement.  The following terms shall have the 
following meanings:

     "COLLECTION ACCOUNT SHORTFALL" means, with respect to Series 1997-B and 
any Distribution Date, the Deficiency Claim Amount, as defined in the Series 
1997-B Sale and Servicing Agreement, with respect to such Distribution Date.

     "DEEMED CURED" means with respect to Series 1997-B, (a) with respect to 
an event that has occurred pursuant to clause (A)(i) of the definition of 
Trigger Event, as of a Determination Date with respect to Series 1997-B, that 
no event as specified in clause (A)(i) of the definition thereof with respect 
to such Series shall have occurred as of such Determination Date or as of any 
of the five consecutively preceding Determination Dates, and (b) with respect 
to an event that has occurred pursuant to clause (A)(ii) or clause (A)(iii) 
of the definition of Trigger Event, as of the next Determination Date which 
occurs in a calendar month which is a multiple of three months succeeding the 
Series 1997-B Closing Date, that no event specified in clause (A)(ii) or 
clause (A)(iii) of the definition of Trigger Event with respect to such 
Series shall have occurred as of such Determination Date.

     "INITIAL PRINCIPAL AMOUNT" means $775,000,000 with respect to Series 
1997-B.

     "INITIAL SPREAD ACCOUNT DEPOSIT" means $11,625,000 for Series 1997-B.

                                      2

<PAGE>

     "INITIAL SPREAD ACCOUNT MAXIMUM AMOUNT" means, with respect to Series 
1997-B and any Distribution Date, an amount equal to the greater of (i) 7% of 
the Series 1997-B Balance as of the close of business on such Distribution 
Date and (ii) the Spread Account Minimum Amount as of the close of business 
on such Distribution Date.

     "SERIES 1997-B BALANCE" means, with respect to Series 1997-B and any 
Distribution Date, the aggregate principal amount of the Series 1997-B Notes 
as of such Distribution Date (after giving effect to the distributions in 
respect of principal on the Notes made on such Distribution Date).

     "SERIES 1997-B COLLATERAL" has the meaning specified in Section 2.3(a) 
hereof.

     "SERIES 1997-B CREDIT ENHANCEMENT FEE" means the amount distributable on 
each Distribution Date pursuant to Section 4.6(viii) and (ix) of the Series 
1997-B Sale and Servicing Agreement.

     "SERIES 1997-B INDENTURE" means the Indenture, dated as of June 1, 1997, 
among the Series 1997-B Trust, the Trustee and the Indenture Collateral Agent.

     "SERIES 1997-B NOTE POLICY" means the financial guaranty insurance 
policy issued by Financial Security with respect to the Series 1997-B Notes.

     "SERIES 1997-B NOTES" means the Class A-1, Class A-2, Class A-3, Class 
A-4 and Class A-5 Notes issued pursuant to the Series 1997-B Indenture.

     "SERIES 1997-B OWNER TRUSTEE" means Mellon Bank (DE), National 
Association, not in its individual capacity but solely as Owner Trustee, or 
its successor in interest, and any successor Owner Trustee appointed as 
provided in the Series 1997-B Trust Agreement.

     "SERIES 1997-B RECEIVABLE" means each Receivable referenced on the 
Schedule of Receivables attached to the Series 1997-B Sale and Servicing 
Agreement, as supplemented from time to time during the Funding Period by one 
or more Subsequent Transfer Agreements.

     "SERIES 1997-B RESERVE ACCOUNT" means the Reserve Account established 
pursuant to Section 4.1(d) of the Series 1997-B Sale and Servicing Agreement.

     "SERIES 1997-B SALE AND SERVICING AGREEMENT" means the Sale and 
Servicing Agreement, dated as of June 1, 1997, among the Series 1997-B Trust, 
Arcadia Financial, in its individual capacity and as Servicer, the Seller and 
the Backup Servicer, as such agreement may be supplemented, amended or 
modified from time to time.

     "SERIES 1997-B SECURED OBLIGATIONS" means the Insurer Secured 
Obligations and the Trustee Secured Obligations with respect to Series 1997-B.

     "SERIES 1997-B SPREAD ACCOUNT" means the Spread Account established 
pursuant to Section 3.1(a) hereof.

                                  3

<PAGE>

     "SERIES 1997-B SUPPLEMENT" means this Series 1997-B Supplement which
constitutes a Series Supplement to the Spread Account Agreement.

     "SERIES 1997-B TRUST AGREEMENT" means the Trust Agreement, dated as of June
1, 1997, among the Seller, Financial Security and the Series 1997-B Owner
Trustee.

     "SPREAD ACCOUNT ADDITIONAL DEPOSIT" means, with respect to Series 1997-B
and any Subsequent Transfer Date, an amount equal to 0.00% of the aggregate
Principal Balance (as of the related Subsequent Cutoff Date) of the Subsequent
Receivables being transferred to the Series 1997-B Trust on such Subsequent
Transfer Date or such greater amount as required by the Rating Agencies to
confirm that the rating assigned to the Series 1997-B Notes will be in the
highest category by such Rating Agencies.

     "SPREAD ACCOUNT MAXIMUM AMOUNT" means, with respect to Series 1997-B and
any Distribution Date:

       (i)    if no Insurance Agreement Event of Default with respect to
     Series 1997-B has occurred and is continuing, no Capture Event has
     occurred  and is continuing, no Trigger Event has occurred on the related
     Determination Date, and if any Trigger Event with respect to Series 1997-B
     has occurred as of a prior Determination Date, such Trigger Event is Deemed
     Cured as of the related Determination Date, the Initial Spread Account
     Maximum Amount with respect to Series 1997-B and such Distribution Date;

       (ii)   if an event specified in clause (A) of the definition of
     Trigger Event with respect to Series 1997-B has occurred as of the
     Determination Date or has occurred as of a prior Distribution Date (and
     whether or not a Trigger Event shall occur or shall have occurred in
     connection with such event), and such event is not Deemed Cured as of the
     related Determination Date and no Insurance Agreement Event of Default with
     respect to Series 1997-B has occurred and is continuing and no Capture
     Event has occurred and is continuing, the Spread Account Maximum Amount
     shall be equal to the greater of (i) 10% of the Series 1997-B Balance as of
     the close of business on such Distribution Date and (ii) the Spread Account
     Minimum Amount as of the close of business on such Distribution Date; or

       (iii)  if (A) an Insurance Agreement Event of Default with respect
     to Series 1997-B has occurred and is continuing or (B) a Capture Event has
     occurred and is continuing as of the related Determination Date, the Spread
     Account Maximum Amount shall be equal to the greater of (i) 25% of the
     Series 1997-B Balance as of the close of business on such Distribution Date
     and (ii) the Spread Account Minimum Amount as of the close of business on
     such Distribution Date.

     "SPREAD ACCOUNT MINIMUM AMOUNT" means, with respect to Series 1997-B and
any Distribution Date, an amount equal to the greater of:

          (i)  $100,000, and

                                   4
<PAGE>

          (ii) the lesser of:

               (A)  1.5% of the Initial Principal Amount of Series 1997-B, and

               (B)  the Series 1997-B Balance.

     "TRIGGER EVENT" means, with respect to Series 1997-B and as of a
Determination Date, the occurrence of any of the events specified in clause (A)
together with the occurrence of the event specified in clause (B):

     (A)(i)    the Average Delinquency Ratio for such Determination Date shall
               be 6.18% or greater;

      (ii)     with respect to any Determination Date, the Cumulative Default
               Rate shall be equal to or greater than the percentage set forth
               in Column A of Schedule I attached hereto corresponding to such
               Determination Date; 

     (iii)     with respect to any Determination Date, the Cumulative Net Loss
               Rate shall be equal to or greater than the percentage set forth
               in Column B of Schedule I attached hereto corresponding to such
               Determination Date; 

     (B)       The amount specified with respect to such Series in the last
               sentence of Section 2.09(d) of the Spread Account Agreement is
               positive on such Determination Date, and such amount has not been
               deposited in the related Tag Account on such Determination Date.

      Section 1.2  RULES OF INTERPRETATION.  The terms "hereof," "herein," 
"hereto" or "hereunder," unless otherwise modified by more specific 
reference, shall refer to this Series 1997-B Supplement.  Unless otherwise 
indicated in context, the terms "Article," "Section" or "Exhibit" shall refer 
to an Article or Section of, or Exhibit to, this Series 1997-B Supplement.  
The definition of a term shall include the singular, the plural, the past, 
the present, the future, the active and the passive forms of such term.  A 
term defined herein and used herein preceded by a Series designation, shall 
mean such term as it relates to the Series designated.

                                  ARTICLE II

           CREDIT ENHANCEMENT FEE; SERIES SUPPLEMENTS; THE COLLATERAL

      Section 1.2  SERIES 1997-B CREDIT ENHANCEMENT FEE.  The Series 1997-B 
Sale and Servicing Agreement provides for the payment to the Seller of the 
Series 1997-B Credit Enhancement Fee, to be paid to the Seller by 
distribution of such amounts to the Collateral Agent for deposit and 
distribution pursuant to this Agreement. The Seller and Arcadia Financial 
hereby agree that payment of the Series 1997-B Credit Enhancement Fee in the 
manner and subject to the conditions set forth herein and in the Series 
1997-B Sale and Servicing Agreement is adequate consideration and the 
exclusive consideration to be received by the Seller or Arcadia 

                                  5
<PAGE>

Financial for the obligations of the Seller pursuant hereto and the 
obligations of Arcadia Financial pursuant hereto (including, without 
limitation, the transfer by the Seller to the Collateral Agent of the Initial 
Spread Account Deposit with respect to Series 1997-B) and pursuant to the 
Series 1997-B Insurance Agreement.  The Seller and Arcadia Financial hereby 
agree with the Trustee and with Financial Security that payment of the Series 
1997-B Credit Enhancement Fee to the Seller is expressly conditioned on 
subordination of the Series 1997-B Credit Enhancement Fee to payments on the 
Notes (if any) and Certificates of any Series, payments of amounts due to 
Financial Security and the other obligations of the Trusts, in each case to 
the extent provided in Section 4.6 of the Standard Terms and Conditions or 
Section 4.6 of the related Sale and Servicing Agreement, as applicable, and 
Section 3.03 of the Spread Account Agreement, and the Security Interest of 
the Secured Parties in the Series 1997-B Collateral is intended to effect and 
enforce such subordination and to provide security for the Series 1997-B 
Secured Obligations and subject to the terms hereof the Secured Obligations 
with respect to other Series.

      Section 2.2  SERIES SUPPLEMENTS.  As provided in and subject to the 
conditions specified in Section 2.02 of the Spread Account Agreement, the 
parties hereto are entering into this Series 1997-B Supplement with respect 
to the Series 1997-B Securities.

      Section 2.3   GRANT OF SECURITY INTEREST BY ARCADIA FINANCIAL AND THE 
SELLER.

      (a)  In order to secure the performance of the Secured Obligations with 
respect to each Series, the Seller (and Arcadia Financial, to the extent it 
may have any rights therein) hereby pledges, assigns, grants, transfers and 
conveys to the Collateral Agent, on behalf of and for the benefit of the 
Secured Parties to secure the Secured Obligations, a lien on and security 
interest in (which lien and security interest is intended to be prior to all 
other liens, security interests or other encumbrances), all of its right, 
title and interest in and to the following (all being collectively referred 
to herein as the "Series 1997-B Collateral"):

             (i)  the Series 1997-B Credit Enhancement Fee and all rights
     and remedies that the Seller may have to enforce payment of the Series
     1997-B Credit Enhancement Fee whether under the Series 1997-B Sale and
     Servicing Agreement or otherwise;

            (ii)  the Series 1997-B Spread Account established pursuant
     to Section 3.1 of this Series 1997-B Supplement and Section 3.01 of the
     Spread Account Agreement, and each other account owned by the Seller and
     maintained by the Collateral Agent (including, without limitation, all
     monies, checks, securities, investments and other documents from time to
     time held in or evidencing any such accounts);

           (iii)  all of the Seller's right, title and interest in and to
     investments made with proceeds of the property described in clauses (i) 
     and (ii) above, or made with amounts on deposit in the Series 1997-B Spread
     Account; and

            (iv)  all distributions, revenues, products, substitutions,
     benefits, profits and proceeds, in whatever form, of any of the foregoing.

                                    6

<PAGE>

      (b)  In order to effectuate the provisions and purposes of this Series 
1997-B Supplement, including for the purpose of perfecting the security 
interests granted hereunder, the Seller represents and warrants that it has, 
prior to the execution of this Series 1997-B Supplement, executed and filed 
an appropriate Uniform Commercial Code financing statement in Minnesota 
sufficient to ensure that the Collateral Agent, as agent for the Secured 
Parties, has a first priority perfected security interest in all Series 
1997-B Collateral which can be perfected by the filing of a financing 
statement.

                                   ARTICEL III

                                 SPREAD ACCOUNT

      Section 3.1  ESTABLISHMENT OF SERIES 1997-B SPREAD ACCOUNT; INITIAL 
DEPOSIT INTO SERIES 1997-B SPREAD ACCOUNT.

      (a)  On or prior to the Closing Date, the Collateral Agent shall 
establish with respect to Series 1997-B, at its office or at another 
depository institution or trust company, an Eligible Account, designated 
"Spread Account--Series 1997-B--Norwest Bank Minnesota, National Association, 
as Collateral Agent for Financial Security Assurance Inc. and another Secured 
Party" (the "Series 1997-B Spread Account").

      (b)  On the Closing Date relating to Series 1997-B, the Collateral 
Agent shall deposit the Initial Spread Account Deposit with respect to Series 
1997-B received from the Seller into the Series 1997-B Spread Account.

      Section 3.2  SPREAD ACCOUNT ADDITIONAL DEPOSITS.  On each Subsequent 
Transfer Date, the Series 1997-B Trust will, pursuant to Section 2.4 of the 
Series 1997-B Sale and Servicing Agreement, deliver on behalf of the Seller 
the Spread Account Additional Deposit for such Subsequent Transfer Date to 
the Collateral Agent. The Collateral Agent shall deposit each such Spread 
Account Additional Deposit received from the Series 1997-B Trust into the 
Series 1997-B Spread Account. IV.B.     

                                ARTICLE VI

                               MISCELANEOUS

      Section 4.1  FURTHER ASSURANCES.  Each party hereto shall take such 
action and deliver such instruments to any other party hereto, in addition to 
the actions and instruments specifically provided for herein, as may be 
reasonably requested or required to effectuate the purpose or provisions of 
this Series 1997-B Supplement or to confirm or perfect any transaction 
described or contemplated herein.

                                     7

<PAGE>    
                    
      Section 4.2  GOVERNING LAW.  This Series 1997-B Supplement shall be 
governed by and construed, and the obligations, rights and remedies of the 
parties hereunder shall be determined, in accordance with the laws of the 
State of New York.

      Section 4.3  COUNTERPARTS.  This Series 1997-B Supplement may be 
executed in two or more counterparts by the parties hereto, and each such 
counterpart shall be considered an original and all such counterparts shall 
constitute one and the same instrument.

      Section 4.4  HEADINGS.  The headings of sections and paragraphs and the 
Table of Contents contained in this Series 1997-B Supplement are provided for 
convenience only.  They form no part of this Series 1997-B Supplement and 
shall not affect its construction or interpretation. 

                                       8

<PAGE>

      IN WITNESS WHEREOF, the parties hereto have executed this Series 1997-B 
Supplement as of the date set forth on the first page hereof.

                             ARCADIA FINANCIAL LTD.


                             By______________________________ 
                                Name:  John A. Witham
                                Title: Executive Vice President and
                                  Chief Financial Officer  


                             ARCADIA RECEIVABLES FINANCE CORP.


                             By________________________________ 
                                Name:  John A. Witham
                                Title: Senior Vice President and
                                     Chief Financial Officer   


                             FINANCIAL SECURITY ASSURANCE INC.


                             By________________________________ 
                                Authorized Officer


                             THE CHASE MANHATTAN BANK, 
                             as Trustee


                             By________________________________ 
                                Name:
                                Title:  


                             NORWEST BANK MINNESOTA, NATIONAL
                                ASSOCIATION, as Collateral Agent


                             By________________________________ 
                                Name:  Thomas D. Wraalstad
                                Title: Corporate Trust Officer

<PAGE>

                                                                      SCHEDULE I
 Determination Date*       Cumulative Default Rate    Cumulative Net Loss Rate
     (month)                    (Column A)                   (Column B)
      0 to 3                       2.60%                        1.35%
      3 to 6                       4.78%                        2.35%
      6 to 9                       6.72%                        3.18%
      9 to 12                      8.32%                        3.77%
     12 to 15                      9.09%                        4.13%
     15 to 18                     10.14%                        4.45%
     18 to 21                     11.08%                        4.70%
     21 to 24                     11.78%                        4.90%
     24 to 27                     12.42%                        5.05%
     27 to 30                     12.96%                        5.20%
     30 to 33                     13.37%                        5.30%
     33 to 36                     13.68%                        5.40%
     36 to 39                     13.96%                        5.48%
     39 to 42                     14.12%                        5.55%
     42 to 45                     14.27%                        5.63%
     45 to 48                     14.40%                        5.67%
     48 to 51                     14.47%                        5.70%
     51 to 54                     14.54%                        5.74%
     54 to 57                     14.57%                        5.77%
     57 to 60                     14.61%                        5.79%
     60 to 63                     14.62%                        5.81%
     63 to 66                     14.64%                        5.82%
     66 to 69                     14.65%                        5.84%
     69 to 72                     14.68%                        5.85%

--------------------
*  Such Determination Date occurring after the designated calendar months 
succeeding the Series 1997-B Closing Date appearing first in the column 
below, and prior to or during the designated calendar months succeeding the 
Series 1997-B Distribution Date appearing second in the column below.