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                                                                   Exhibit 10.16

                             STOCK PLEDGE AGREEMENT

     THIS STOCK PLEDGE AGREEMENT (this "Agreement") is made and entered into as
of August 1, 2001, by and between Joseph J. Lydon ("Pledgor") and Accredited
Home Lenders Inc., a California corporation ("Secured Party").

                                    RECITALS

     A. Concurrently with the execution and delivery of this Agreement, Pledgor
has executed and delivered to Secured Promissory Note of even date herewith in
the original principal amount of One Million Two Hundred Fifty Thousand and
00/100 Dollars ($1,250,000.00) (the "Note") in connection with the purchase by
Pledgor of Common Stock of Secured Party through the exercise by Pledgor of
options held by Pledgor to acquire such Common Stock.

     B. Secured Party and Pledgor desire to secure performance of Pledgor's
obligations and indebtedness under the Note.

                                   AGREEMENT

     1. Grant of Security Interest. Pledgor confirms, pledges and grants to
Secured Party a security interest in all of its right, title, and interest in
the property described in Paragraph 2 below (collectively and severally, the
"Collateral"), to secure performance of the obligations described in Paragraph 3
below.

     2. Collateral. The Collateral consists of the following:

          (a) One million (1,000,000) shares of the Common Stock of Secured
     Party, together with all new, substituted and additional securities issued
     at any time during the term hereof with respect to those shares
     (collectively and severally, the "Pledged Shares");

          (b) All now existing and hereafter arising rights of the holder of
     Pledged Shares with respect thereto, without limitation, all rights to cash
     and non-cash dividends on account of the Pledged Shares; and

          (c) All proceeds of the sale, collection, exchange or other
     disposition of the Pledged Shares (including without limitation, by way of
     distribution upon dissolution or merger of Secured Party), whether such
     disposition is voluntary or involuntary.

     3. Obligations. The obligations (the "Obligations") secured by this
Agreement shall consist of any and all obligations and indebtedness of Pledgor
under the Note and under this Agreement.

     4. Administration of the Pledged Shares. The following provisions shall
govern the administration of the Pledged Shares:

          (a) Concurrently with the execution of this Agreement, Pledgor has
     delivered to Secured Party the certificates representing the Pledged
     Shares, together with a Stock Assignment Separate From Certificate, in the
     form attached hereto as Exhibit A, signed by Pledgor, and such

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items shall be held during the term of this Agreement by Secured Party and shall
only be used by Secured Party upon the occurrence of an Event of Default
(defined below). Any and all certificates representing the Pledged Shares shall
be delivered to Secured Party bearing the following legend:

           "THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
           THE PROVISIONS OF A STOCK PLEDGE AGREEMENT DATED AUGUST 1,
           2001 BETWEEN THE REGISTERED HOLDER AND THE ISSUER, A COPY
           OF WHICH MAY BE OBTAINED BY REQUEST FROM THE ISSUER."

          (b) Until there shall have occurred an Event of Default, Pledgor shall
be entitled to vote or consent with respect to the Pledged Shares in any manner
not inconsistent with this Agreement, or any document or instrument delivered or
to be delivered pursuant to or in connection herewith. If there shall have
occurred and be continuing an Event of Default and Secured Party shall have
notified Pledgor that Secured Party desires to exercise its proxy rights with
respect to all or a portion of the Pledged Shares, Pledgor grants to Secured
Party an irrevocable proxy for the Pledged Shares pursuant to which proxy the
Secured Party shall be entitled to vote or consent, in his discretion, and in
such event Pledgor agrees to deliver to Secured Party such further evidence of
the grant of such proxy as Secured Party may request.

          (c) In the event that at any time or from time to time after the date
hereof, Pledgor, as record and beneficial owner of the Pledged Shares, shall
receive or shall become entitled to receive, any dividends or any other
distribution whether in securities or property by way of stock-split, spin-off,
split-up or reclassification, combination of shares or the like, or in case of
any reorganization, consolidation or merger, and Pledgor, as record and
beneficial owner of the Pledged Shares, shall thereby be entitled to receive
securities or property in respect to such Pledged Shares, then and in each such
case, Pledgor shall deliver to Secured Party and Secured Party shall be entitled
to receive and retain such securities or property as security for the payment
and performance of the Obligations.

     5. Default and Remedies. The occurrence of any of the events set out below
shall be deemed an event of default hereunder ("Event of Default"):

          (a) Pledgor shall default under the Note; or

          (b) Pledgor shall commit a breach of any of his obligations under this
Agreement which is not cured within thirty days following written notice
thereof.

Upon the occurrence of an Event of Default under this Agreement, Secured Party
shall have all of the remedies of a secured party under Article 9 of the
California Uniform Commercial Code. In connection therewith, Secured Party
shall have the right to propose to Pledgor that Secured Party receive the
Pledged Shares in full satisfaction of any obligations owing under the Note and
upon Pledgor's agreement to such proposal to receive such Pledged Shares,
Pledgor shall have no further rights in or to such Pledged Shares. The
undersigned (i) acknowledges that state or federal securities laws may restrict
the public sale of securities, and may require private sales at prices or on
terms less favorable to the seller than public sales and (ii) agrees that where
Secured Party, in its sole discretion, determines that a private sale is
appropriate, such sale shall be deemed to have been made in a commercially
reasonable manner.

                                       2

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     6. Release of Collateral. So long as Pledgor is not in breach of any
material term or provision of this Agreement or the Note, the Collateral shall
be released to Pledgor upon payment of the Note.

     7. Binding Upon Successors. All rights of Secured Party under this
Agreement shall inure to the benefit of Secured Party and its successors and
assigns, and all obligations of Pledgor shall bind his successors and assigns.

     8. Entire Agreement; Severability. This Agreement contains the entire
agreement between the Secured Party and Pledgor with respect to the subject
matter hereof. If any of the provisions of this Agreement shall be held invalid
or unenforceable, this Agreement shall be construed as if not containing those
provisions, and the rights and obligations of the parties hereto shall be
construed and enforced accordingly.

     9. Choice of Law. This Agreement shall be construed in accordance with and
governed by the internal laws of the State of California.

     10. Amendments. This Agreement may not be amended or modified except by a
writing signed by each of the parties hereto.

     11. Notice. Any written notice, consent or other communication provided
for in this Agreement shall be deemed delivered when received by a party at
the address set forth under the party's signature below. Such addresses may be
changed by written notice given as provided herein.

     IN WITNESS WHEREOF, the undersigned has duly executed this Pledge Agreement
as of the day and year first above written.

                                 /s/  Joseph J. Lydon
                                 -----------------------------------------
                                 JOSEPH J. LYDON

                                 Address: 30902 Colonial Place
                                          Laguna Niguel, CA 92677

                                 ACCREDITED HOME LENDERS INC., a California
                                 corporation

                                      /s/ James A. Konrath
                                 By:  -----------------------------------------
                                      Jamea A. Konrath, Chief Executive Officer

                                 Address: 15030 Avenue of Science, Suite 100
                                          San Diego, CA 92128

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                                   Exhibit A

                   STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE

     FOR VALUE RECEIVED, the undersigned, pursuant to the Stock Pledge Agreement
dated as of August 1, 2001 (the "Stock Pledge Agreement") between the
undersigned and Accredited Home Lenders, Inc. ("Secured Party"), and subject to
Secured Party's certification below that an Event of Default has occurred under
the Stock Pledge Agreement, hereby sells, assigns and transfers
unto_________________1,000,000 shares of the Common Stock of Accredited Home
Lenders, Inc., standing in the undersigned's name on the books of said
Corporation and represented by Certificate No(s)._________, and does hereby
irrevocably constitute and appoint_________________ attorney to transfer said
stock on the books of said Corporation with full power of substitution.

Dated:______________                   _________________________________
                                       JOSEPH J. LYDON



                           CERTIFICATE RE OCCURRENCE
                                       OF
                                EVENT OF DEFAULT

     The undersigned Secured Party under the Stock Pledge Agreement described
above hereby certifies that an Event of Default has occurred under the Stock
Pledge Agreement.

Dated:______________                          SECURED PARTY


                                              By:__________________

                                              Name:________________

                                              Title:_______________