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Exhibit 99.3

First Alliance Mortgage Loan Trust

                 Mortgage Loan Asset Backed Notes Series 1998-2
                             1998 - Annual Statement
                              DISTRIBUTION DOLLARS
                                                                 ENDING
PERIOD     CLASS      CUST     INTEREST        PRINCIPAL         BALANCE
 199807  FIXED NOTE           $380,333.33    $750,275.30      $69,249,724.70
 199808  FIXED NOTE           $376,256.84   $1,553,660.03     $67,696,064.67
 199809  FIXED NOTE           $367,815.28   $1,056,071.85     $66,639,992.82
 199810  FIXED NOTE           $362,077.29   $1,739,275.05     $64,900,717.77
 199811  FIXED NOTE           $352,627.23   $1,644,605.74     $63,256,112.03
 199812  FIXED NOTE           $343,691.54   $1,892,841.30     $61,363,270.73
Total by Class              $2,182,801.51   $8,636,729.27

PERIOD     CLASS      CUST     INTEREST        PRINCIPAL         BALANCE
 199807  ARMS NOTE            $116,325.00     $628,419.34     $29,371,580.66
 199808  ARMS NOTE            $147,105.73     $251,810.45     $29,119,770.21
 199809  ARMS NOTE            $150,347.06     $277,419.09     $28,842,351.12
 199810  ARMS NOTE            $134,409.36     $454,875.65     $28,387,475.47
 199811  ARMS NOTE            $131,681.05   $1,165,942.13     $27,221,533.34
 199812  ARMS NOTE            $122,382.83   $3,547,181.68     $23,674,351.66
Total by Class                $802,251.03   $6,325,648.34

Total Class R Certificates:   $162,543.01

Factor Information Per $1,000
             PRINCIPAL       INTEREST     ENDING NOTE    INIT NOTE  CURR NOTE
  CLASS     DISTRIBUTION   DISTRIBUTION     BALANCE         RATE       RATE

FIXED NOTE  123.38184671    31.18287871   876.61815329    6.52000%   6.52000%

ARMS NOTE   210.85494466    26.74170100   789.14505533    5.81625%   5.22094%

                                                           Per $1,000
NOTE DISTRIBUTION:                         $17,947,430.15    179.47

SCHEDULED PRINCIPAL:                          $401,101.51
PREPAYMENTS & PREFUNDING ACT. REMAINDER:   $13,472,725.64
SUBORDINATION INCREASE:                     $1,088,550.46
                                           --------------

TOTAL PRINCIPAL DISTRIBUTION:              $14,962,377.61    149.62

TOTAL INTEREST DISTRIBUTION:                $2,985,052.54

INSURED PAYMENT
   FIXED RATE NOTE:                                  0.00
   ADJUSTABLE RATE NOTE:                             0.00


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LOAN PURCHASE PRICES
   FIXED RATE NOTE:                         $1,007,037.53
   ADJUSTABLE RATE NOTE:                    $3,741,806.56

SUBSTITUTION AMOUNTS
   FIXED RATE NOTE:                                  0.00
   ADJUSTABLE RATE NOTE:                             0.00

SUBORDINATION REDUCTION AMOUNT
   FIXED RATE NOTE:                                  0.00
   ADJUSTABLE RATE NOTE:                             0.00

CURRENT REALIZED LOSSES
   FIXED RATE NOTE:                                  0.00
   ADJUSTABLE RATE NOTE:                             0.00

CUMULATIVE REALIZED LOSSES
   FIXED RATE NOTE:                                  0.00
   ADJUSTABLE RATE NOTE:                             0.00

FIXED RATE NOTE                                NUMBER      LOAN BALANCE
---------------                                ------      ------------

LOANS BOUGHT BACK PURSUANT TO SECTION 2.4
                  CURRENT:                        0              0.00
                  CUMULATIVE:                     0              0.00
LOANS BOUGHT BACK PURSUANT TO SECTION 2.6
                  CURRENT:                        0              0.00
                  CUMULATIVE:                     0              0.00
LOANS BOUGHT BACK PURSUANT TO SECTION 4.10
                  CURRENT:                        0              0.00
                  CUMULATIVE:                     0              0.00

ADJUSTABLE RATE NOTE                          NUMBER      LOAN BALANCE
--------------------                          ------      ------------

LOANS BOUGHT BACK PURSUANT TO SECTION 2.4
                  CURRENT:                        0              0.00
                  CUMULATIVE:                     0              0.00
LOANS BOUGHT BACK PURSUANT TO SECTION 2.6
                  CURRENT:                        0              0.00
                  CUMULATIVE:                     0              0.00
LOANS BOUGHT BACK PURSUANT TO SECTION 4.10
                  CURRENT:                        0              0.00
                  CUMULATIVE:                     0              0.00

AVAILABLE FUNDS CAP CARRY-FORWARD AMOUNT:                        0.00

DELINQUENT MORTGAGE LOANS(includes loans in foreclosure and bankruptcy):

         FIXED RATE NOTE
                                  AGGREGATE
            CATEGORY    NUMBER   LOAN BALANCE   PERCENTAGE
           30-59 DAYS     13    $1,246,155.27      2.01%
           60-89 DAYS      8      $619,726.11      1.00%
            90+ DAYS       5      $492,670.06      0.79%

      ADJUSTABLE RATE NOTE
                                  AGGREGATE
            CATEGORY     NUMBER  LOAN BALANCE   PERCENTAGE
           30-59 DAYS      4      $537,660.49      2.23%
           60-89 DAYS      5      $411,996.26      1.71%
            90+ DAYS       5      $417,648.87      1.74%



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LOANS IN FORECLOSURE(included in delinquencies above):

   FIXED RATE NOTE                 AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                           22   $2,039,675.38      3.29%

   ADJUSTABLE RATE NOTE            AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                           11     $946,377.78      3.93%


LOANS IN BANKRUPTCY(included in delinquencies above):

   FIXED RATE NOTE                 AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                            2     $139,181.40      0.22%

   ADJUSTABLE RATE NOTE            AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                            0           $0.00      0.00%

REO PROPERTIES(included in delinquencies above):

   FIXED RATE NOTE                 AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                            0           $0.00      0.00%

   ADJUSTABLE RATE NOTE            AGGREGATE
                         NUMBER  LOAN BALANCE   PERCENTAGE
                            0           $0.00      0.00%

ENDING AGGREGATE LOAN BALANCE
   FIXED RATE NOTE:                      $62,063,270.73
   ADJUSTABLE RATE NOTE:                 $24,063,950.80

BOOK VALUE OF REO PROPERTY:
   FIXED RATE NOTE:                                0.00
   ADJUSTABLE RATE NOTE:                           0.00