UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C.  20549
                                
                            FORM 10-Q
                                
IXI  QUARTERLY  REPORT PURSUANT TO SECTION 13  OR  15(d)  OF  THE
     SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 1997
                               OR

I   I      TRANSITION REPORT PURSUANT TO SECTION 13 OR  15(d)  OF
     THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                to

Commission File Number 1-9742

               HARBOURTON FINANCIAL SERVICES L.P.
     (Exact name of registrant as specified in its charter)
                                
              DELAWARE                             52-1573349
(State  or  other jurisdiction of incorporation or  organization)
(I.R.S. Employer Identification No.)

         2530   S.   Parker    Road,  Suite  500,   Aurora,    CO
80014
(Address of principal executive offices)          (Zip Code)

 Registrant's telephone number, including area code:  (303) 745-
                              3661
                                
   Securities registered pursuant to Section 12(b) of the Act:

Title of each class             Name of each exchange on which registered
Preferred Units                          New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:  None
                                
Indicate  by check mark whether the registrant (1) has filed  all
reports  required  to be filed by Section  13  or  15(d)  of  the
Securities  Exchange Act of 1934 during the preceding  12  months
(or  for such shorter period that the registrant was required  to
file  such  reports),  and (2) has been subject  to  such  filing
requirements for the past 90 days.  Yes         X           No

At  November 26, 1997, registrant had 41,169,558 Preferred  Units
outstanding.
                        TABLE OF CONTENTS
                                
                             PART I
                                
                                
Item      1.  Financial Statements

Consolidated Balance Sheet as of December 31, 1996  3

Condensed Consolidated Statement of Net Assets in Liquidation as of
 September 30, 1997 (unaudited)                     4

Consolidated Statement of Operations for the Three Months and Nine
 Months Ended September 30, 1996 (unaudited)        5

Condensed Consolidated Statement of Changes in Net Assets in Liquidation
 For the Nine Months Ended September 30, 1997 (unaudited)    6

Consolidated Statement of Cash Flows for the Nine Months Ended September
 30, 1996 (unaudited)                               7

Notes to Consolidated Financial Statements as of September 30, 1997
 (unaudited)                                        8

Item      2.Management's Discussion and Analysis of Financial 
Condition and Results of Operations                  18

                             PART II

            OTHER INFORMATION                                  24

            SIGNATURES                                         25


       HARBOURTON FINANCIAL SERVICES L.P. AND SUBSIDIARIES
                   Consolidated Balance Sheet
                     as of December 31, 1996
          (After Corporate Reorganization  --  Note 1)
                    (audited) (in thousands)
<TABLE>
                                                          
<S>                                                            <C>
ASSETS                                               
     Cash and cash equivalents                            $    1,951
     Mortgage loans held for sale, net                       214,609
     Mortgage loans held for investment, net of                3,178
      reserves of $307
     CMO bonds, residual interests, investment            
      securities and SMATs, net of accumulated                 3,583
      amortization of $577
     Notes receivable - affiliates                               587
     Investment in loans repurchased from GNMA                40,127
      pools, net of reserves of $1,120
     Advances receivable, net of reserves of $3,984            5,709
     Mortgage servicing rights, net of accumulated            41,773
      amortization of $9,268
     Deferred acquisition, transaction and borrowing      
      costs, net of accumulated amortization of                2,825
      $1,075
     Property, equipment and leasehold improvements,      
      net of accumulated amortization of $4,567                5,773
     Investment in affiliates                                    405
     Due from affiliates                                          --
     Excess cost over identifiable tangible and           
      intangible assets acquired, net of accumulated           2,633
      amortization of $577
     Bulk and flow sales of servicing receivables             52,658
     Other assets                                              8,309
Total Assets                                                $384,120
                                                     
LIABILITIES AND PARTNERS' CAPITAL                    
Liabilities:                                         
  Installment purchase and sale obligations -              $   1,303
   servicing
  Foreclosure, repurchase and indemnification                  6,403
   reserves
  Lines of credit & short-term borrowings                    212,388
  Servicing facility                                          54,400
  Notes payable - affiliates                                  38,412
  Due to affiliates                                            1,678
  Accounts payable and other liabilities                      10,604
Total Liabilities                                            325,188
                                                     
Partners' Capital                                             58,932
                                                     
Total Liabilities and Partners' Capital                     $384,120
                                
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
   

    HARBOURTON FINANCIAL SERVICES L.P. AND SUBSIDIARIES
                 (a partnership in liquidation)
                                
  Condensed Consolidated Statement of Net Assets in Liquidation
                    as of September 30, 1997
                   (unaudited) (in thousands)
<TABLE>
                                                           
<S>                                                         <C>
Assets, at estimated realizable values:               
     Cash and cash equivalents                             $19,217
     Mortgage loans held for investment                    14,960
     Investment in loans repurchased from GNMA pools       1,552
     Advances receivable                                   5,285
     Mortgage servicing rights                             1,297
     Mortgage servicing receivables                        25,947
  Other assets                                            5,866
Total Assets                                              $74,124
                                                      
Less - Liabilities, at estimated settlement amounts:  
  Installment purchase and sale obligations -               1,420
   servicing
  Foreclosure, repurchase and indemnification              12,494
   reserves
  Notes payable - affiliates                               14,131
  Due to affiliates                                           122
  Accounts payable and other liabilities                    3,591
Total Liabilities                                          31,758
                                                      
Net Assets in Liquidation                                 $42,366
                                                      
</TABLE>
                                




The accompanying notes are an integral part of these unaudited
consolidated financial statements.
  

       HARBOURTON FINANCIAL SERVICES L.P. AND SUBSIDIARIES
              Consolidated Statements of Operations
     For the Three and Nine Months Ended September 30, 1996
                   (unaudited) (in thousands)
                                
<TABLE>
<S>                                         <C>          <C>
                                           Three         Nine 
                                           Months       Months
                                           Ended        Ended
                                           September 30, 1996
REVENUES                                             
  Loan servicing fees                   $  6,091      $  18,752
  Ancillary income                          1,703        5,527
  Gain on sale of defaulted loans to         167          678
    affiliates
  Investment income net of interest        3,663        8,129
    expense on escrows
       Total servicing revenue             11,624       33,086
                                                          
  Gain on sale of mortgage loans and                   
   related mortgage servicing rights       5,617        15,280
  Interest income, net of related          1,760        4,242
   warehouse interest expense
  Other production income                   3,819       11,331
     Total production income - gross       11,196       30,853
                                                     
  Other investment and interest income         430       4,083
     Total Revenue                          23,250       68,022
                                                     
EXPENSES                                             
     Servicing costs                         2,370        7,141
  Prepayment costs and interest                610          1,783
   curtailments
  Provision for foreclosure losses          1,500        5,093
  Amortization of mortgage servicing        3,311        8,812
   rights
     Total servicing expenses                7,791        22,829
                                                          
  Loan production and secondary marketing   10,312       28,540
   costs
                                                          
  General and administrative costs,           1,633        4,845
   including management fees
  Interest expense - term loans               1,014        2,542
  Other interest expense                        276          1,073
  Other interest expense-affiliates, net        694          1,778
   of interest income-affiliates
  Other amortization and depreciation           599       1,500
     Total Expenses                           22,319       63,107
  Net Income Before Equity in Earnings of                   
  Affiliates and Gain on Bulk Sale of            931        4,915
  Servicing
  Equity in earnings of affiliates               (9)          (4)
  Gain on bulk sale of servicing                 220           220
  Net Income                                  $  1,142     $  5,131
  Net Income per Preferred Unit, based on              
   41,170 and 41,495 weighted average        $      .03   $      .12
   number of Preferred Units
   outstanding, respectively
                                
</TABLE>
The accompanying notes are an integral part of these unaudited
consolidated financial statements.


       HARBOURTON FINANCIAL SERVICES L.P. AND SUBSIDIARIES
              Consolidated Statement of Cash Flows
          For The Nine Months Ended September 30, 1996
                   (unaudited) (in thousands)
<TABLE>
<S>                                                     <C>
                                                      Nine Months
                                                        Ended
                                                      September
                                                      30, 1996
Cash Flows From Operating Activities:                
  Net Income                                           $   5,131
     Adjustments to reconcile net income to net cash from 
      operating activities:
     Gain on sale of defaulted loans                        (678)
     Gain on sale of CMO bonds, residual interests        (2,486)
      and SMATs
     Net unrealized gain on CMO bonds, residual           (1,043)
      interests and SMATs
     Gain on bulk sale of originated servicing              (220)
     Mortgage servicing rights valuation recovery          (1,042)
     Amortization and depreciation                         11,354
     Equity in earnings of affiliates                           4
     Provision for foreclosure losses                       5,093
     Changes in operating assets and liabilities:    
       Mortgage loans held for sale and investment,net     63,163
       Advances receivable                                (11,987)
       Other assets                                       (18,638)
       Due to/from affiliates                              31,228
       Accounts payable and other liabilities              (5,942)
   Net Cash Flows  From Operating Activities               73,937
   Net Cash Flows  From Investing Activities:           
    Proceeds from sale of CMO bonds, residual               5,550
     interests and SMATs
    Gain on sale associated with retained servicing       (20,363)
    Proceeds from bulk sale of originated servicing         3,546
    Settlement of installment purchase obligation          (8,017)
    Funding of deferred acquisition and transaction          (226)
     costs
    Amortization of CMO bonds, residual interests, and       1,222
     investment securities
    Investment in subsidiary                                  (100)
    Purchases of property and equipment                     (3,025)
  Net Cash Flows  From Investing Activities                (21,413)
  Cash Flows From Financing Activities:                
    Net payments on lines of credit and short-term         (63,811)
     borrowings
    Principal payments on term loans                       (48,673)
    Funding of deferred loan costs                            (387)
    Term debt advances                                      71,658
    Redemption of Preferred Units                           (1,100)
    Net borrowings from notes payable - affiliates          25,668
  Net Cash Flows From Financing Activities                 (16,645)
  Increase in cash and cash equivalents                     35,879
  Cash and cash equivalents at beginning of period           2,273
  Cash and cash equivalents at end of period               $38,152
</TABLE>
                                
 The accompanying notes are an integral part of these unaudited
               consolidated financial statements.
 

      HARBOURTON FINANCIAL SERVICES L.P. AND SUBSIDIARIES
                 (a partnership in liquidation)
                                
  Condensed Consolidated Statement of Changes in Net Assets in
                           Liquidation
                   (unaudited) (in thousands)
                                
<TABLE>
                                                   
<S>                                                             <C>
Net partners' equity at December 31, 1996                   $58,932
                                                   
Net loss during the three months ended March 31,1997         (2,718)
                                                     
Adjustment of carrying values of assets and          
liabilities to estimated realizable values and     
estimated settlement amounts, respectively, at     
March 31, 1997, upon adoption of liquidation
basis of accounting:
                                                   
     Mortgage loans held for sale                             1,393
     Mortgage servicing rights                                9,006
     Property, equipment and leasehold improvements            (779)
     Foreclosure, repurchase and indemnification reserves    (2,400)
     Other liabilities related to liquidation                (5,830)
                                                   
Net assets in liquidation at March 31, 1997                 $57,604
                                                   
Changes from March 31, 1997 in estimated realizable  
values and estimated settlement amounts:           
                                                   
     Mortgage servicing rights                               (3,561)
     Property, equipment and leasehold improvements            (238)
     Foreclosure, repurchase and indemnification reserves    (8,509)
     Other liabilities related to liquidation                (2,930)
                                                   
Net assets in liquidation at September 30, 1997              $42,366
                                                   
                                                   
Preferred Units outstanding at March 31 and                   41,170
September 30, 1997
                                
</TABLE>
                                
                                
 The accompanying notes are an integral part of these unaudited
               consolidated financial statements.
       

HARBOURTON FINANCIAL SERVICES L.P. AND SUBSIDIARIES
                 (a partnership in liquidation)
                                
           Notes to Consolidated Financial Statements
            December 31, 1996 and September 30, 1997
                                
                                
Note 1.        Description of Business and Organization

Harbourton  Financial Services L.P. ("HBT") was created  pursuant
to  a Certificate of Limited Partnership filed with the Secretary
of  the  State  of  Delaware on August 12,  1987  and  a  limited
partnership  agreement  (the  "HBT Agreement")  (as  amended  and
restated)  dated  as  of  August 12, 1987.   Harbourton  Mortgage
Corporation (the "General Partner") was incorporated in the State
of  Delaware on August 12, 1987.  The General Partner manages the
business and affairs of HBT and has exclusive authority to act on
behalf  of  HBT.   HBT's termination date is  December  31,  2050
unless  sooner  dissolved  or  terminated  pursuant  to  the  HBT
Agreement.  See Note 4, Liquidation of Partnership.

Harbourton  Assignor Corporation ("Assignor Limited Partner")  is
the  sole limited partner of HBT.  Pursuant to the HBT Agreement,
the Assignor Limited Partner holds for the benefit of the holders
of  the  Preferred Units all of the limited partnership interests
underlying  such  Preferred  Units.   Each  Preferred   Unit   is
evidenced by a beneficial assignment certificate, which is issued
by the Assignor Limited Partner and HBT in fully registered form.
Each  holder  of  a  Preferred Unit is entitled  to  all  of  the
economic   rights   and  interests  in  the  underlying   limited
partnership  interest held by the Assignor Limited  Partner,  and
each  holder  of  a Preferred Unit has the right  to  direct  the
Assignor Limited Partner on voting and certain other matters with
respect to such underlying limited partnership interests.

HBT's  primary business activity has been mortgage banking, which
has been conducted through its wholly-owned subsidiary Harbourton
Mortgage Co., L.P. ("HMCLP").  Mortgage banking consists  of  (i)
mortgage loan servicing activities, including the acquisition and
sale  of  mortgage  servicing rights, (ii)  the  origination  and
purchase of mortgage loans, including the securitization and sale
of  mortgage loans with the related servicing rights retained  or
released,   and   (iii)  investments  in  other  mortgage-related
securities.   HMCLP  is an approved Government National  Mortgage
Association   ("GNMA"),  Federal  National  Mortgage  Association
("FNMA"),  and  Federal Home Loan Mortgage Corporation  ("Freddie
Mac")  licensee.  HBT, HMCLP and its general partners  Harbourton
Funding Corporation ("HFC"), and HMCLP's 50% equity investment in
HTP Financial, L.P. ("HTP") are hereinafter collectively referred
to as the "Partnership" unless otherwise noted.

In  general, each quarter the Partnership allocates 99% and 1% of
profits  and  losses  to  the Preferred Unitholders  and  General
Partner, respectively, up to a maximum amount as defined  in  the
HBT   Agreement  ("Participating  Amount").   This  Participating
Amount generally does not exceed the product of the cash or  fair
value of property contributed to the Partnership in consideration
for  the issuance of Preferred Units and the appropriate weighted
average  Treasury Index.  Profits that exceed this  Participating
Amount, up to an additional amount as defined, are allocated 75%,
12.5%   and   12.5%  to  the  Preferred  Unitholders  ("Preferred
Amount"),    General   Partner   and   Subordinated   Unitholder,
respectively.   Preference amounts ("Second  Preference")  beyond
these  levels,  up to an additional amount as defined,  are  then
allocated  62.5%, 18.75% and 18.75% to the Preferred Unitholders,
General   Partner  and  Subordinated  Unitholder,   respectively.
Preference  amounts in excess of the Second Preference  are  then
allocated  55%,  22.5%,  and 22.5% to the Preferred  Unitholders,
General Partner, and Subordinated Unitholder, respectively.  Cash
distributions are allocated approximately in the same  manner  as
allocated taxable profits.  Losses are allocated up to the amount
of  the  sum  of the undistributed Preferred Amount  allocations,
Second    Preference   allocations   and   Participating   Amount
allocations    to   the   Preferred   Unitholders,   Subordinated
Unitholders,   and  General  Partner  in  proportion   to   their
respective interest in the sum of such undistributed allocations.

After  the allocation of profits or losses and the payment of  or
provision  for  all  debts, liabilities and  obligations  of  the
Partnership,  liquidating  distributions  are  allocated  to  the
General  Partner  and Preferred and Subordinated  Unitholders  in
accordance  with  and in proportion to their  respective  capital
account  balances  as  determined  in  accordance  with  the  HBT
Agreement.   At September 30, 1997, the Subordinated  Unitholders
capital  account balances totaled $0.  Management  believes  that
there  will  be  no  liquidating  distributions  distributed   to
Subordinated Unitholders.

Note 2.   Summary     of    Significant    Accounting    Policies
          (Consolidated Balance Sheet at December  31,  1996  and
          Statement  of Operations and Cash Flows for  the  Three
          and  Nine  Months  Ended September  30,  1996  -  Going
          Concern Basis of Accounting)

Basis  of  Presentation - The consolidated  financial  statements
primarily  include the accounts of HBT, HMCLP,  HFC,  and  a  50%
equity   interest   in   HTP.  All  intercompany   accounts   and
transactions have been eliminated in consolidation.

Cash and Cash Equivalents - Cash and cash equivalents consist  of
cash  on  hand  and  in  banks  and short-term  instruments  with
original maturities of three months or less.

Mortgage  Loans Held for Sale - Mortgage loans held for sale  are
stated  at  the  lower of aggregate cost, net  of  deferred  loan
production fees and costs, or market value.

Mortgage  Loans  Held for Investment - Mortgage  loans  held  for
investment are stated at the amount of unpaid principal,  reduced
by   an  allowance  for  loan  losses,  based  upon  management's
evaluation  of  the economic conditions of borrowers,  loan  loss
experience,  collateral value and other relevant  factors,  which
approximates the lower of cost or market.

Investment in Loans Repurchased from GNMA Pools - The Partnership
has repurchased loans from GNMA pools which it services.

Advances  Receivable  -  Funds  advanced  for  mortgagor   escrow
deficits,  foreclosures  and  other  investor  requirements   are
recorded as advances receivable in the consolidated statements of
financial  condition.  Such receivables are generally recoverable
from  the  insurers or guarantors, which are generally government
agencies,  or the mortgagors through increased monthly  payments,
as  applicable.   A  reserve  for uncollectible  items  has  been
established for those receivables which management estimates  are
not recoverable.

Mortgage Servicing Rights - The Partnership capitalizes the  cost
of   mortgage  servicing  rights  and  amortizes  such  costs  in
proportion   to,  and  over  the  period  of,  estimated   future
undiscounted net servicing income.

Collateralized   Mortgage  Obligation  ("CMO")  Bonds,   Residual
Interests,   Investment  Securities,  and  Securitized   Mortgage
Acceptance Trusts ("SMATs") - The Partnership classifies its  CMO
bonds,   residual  interests,  and  SMATs  portfolio  as  trading
securities since the securities are being held with the intent of
selling  them  in  the near term.  Accordingly, such  assets  are
stated  at  fair  value  and  unrealized  gains  and  losses  are
recognized   in   earnings.   The  Partnership   classifies   its
investment  securities as available for sale.  Accordingly,  such
assets  are stated at fair value and unrealized gains and  losses
are recognized as a component of partners' capital.

Deferred  Acquisition, Transaction and Borrowing Costs - Deferred
borrowing  costs  are amortized over the life  of  the  servicing
facility   agreement   using  the  straight-line   method   which
approximates the effective interest method.  Deferred acquisition
and  transaction  costs are amortized over a period  of  five  to
fifteen years using the straight-line method.

Property,   Equipment  and  Leasehold  Improvements  -  Property,
equipment  and  leasehold improvements are stated  at  cost  less
accumulated  depreciation.  Depreciation is  computed  using  the
straight-line  method over the assets' useful  lives,  which  are
estimated to be 30 years for depreciable real property and  2  to
15  years  for  furniture,  fixtures  and  equipment.   Leasehold
improvements  are amortized using the straight-line  method  over
the lease life.

Investment  in Affiliates - HMCLP recorded its 50% investment  in
HTP  based on the equity method of accounting for the year  ended
December 31, 1996.

Excess  Cost  Over  Identifiable Tangible and  Intangible  Assets
Acquired  - Excess cost over identifiable tangible and intangible
assets acquired is amortized using the straight-line method  over
15 years.

Loan Servicing Fees and Servicing Costs - Loan servicing fees are
based on a contractual percentage of the unpaid principal balance
of  the  related  loans and are recognized in income  as  earned.
Servicing costs are charged to operations as incurred.

Investment Income Net of Interest Expense - Investment income net
of  interest  expense  includes primarily the  gain  on  sale  of
reinstated  loans,  interest  income  on  investment   in   loans
repurchased from GNMA pools, net of interest expense  on  related
borrowings to fund such investments and the earnings derived from
the servicing portfolio custodial balances.

Loan  Production Fees and Costs - Certain direct loan  production
fees  and costs associated with mortgage loans held for sale  are
deferred until the related loans are sold.

Foreclosure,   Repurchase,   and   Indemnification   Reserves   -
Foreclosure reserves are maintained to provide for an estimate of
the  losses  associated  with  delinquent  loans  and  loans   in
foreclosure  or  bankruptcy  ("Defaulted  Loans")  in  which  the
Partnership  services  and retains certain recourse  obligations.
The  reserves  are established based on management's expectations
and  historical  loss  experience and are  adjusted  periodically
through charges to current operations to reflect changes  in  the
Defaulted Loans, net of actual charge-offs.

As  part of its production operations, the Partnership is subject
to  certain repurchase and indemnification provisions through its
contractual  agreements  with the investors  to  which  it  sells
mortgage  loans.   These provisions generally  provide  that  the
Partnership repurchase from the investor,  i) loans in which  the
borrower defaults on the first payment, ii) loans which have  not
been  insured  by  the  government in  a  timely  manner  or  are
uninsurable,  and  iii) mortgage loans in  which  an  origination
(i.e.,   underwriting)  defect  is  discovered.   The   investor,
however,  may  require the Partnership to indemnify them  against
future losses that might result rather than repurchase the  loan.
The  reserve is based on management's expectations and historical
loss  experience.   The provisions for this reserve  are  charged
against loan production and secondary marketing costs.

Income  Taxes - The Partnership is a limited partnership  and  is
not   liable   for  federal  income  taxes,  however,  individual
unitholders have liability for income taxes.  As a result of  the
provisions  currently  in the tax law, the  Partnership  will  be
assessed  an  excise tax equal to 3.5% of its gross  profit  from
operations  for  federal income tax purposes  for  its  tax  year
beginning on January 1, 1998.

Use  of  Estimates - The preparation of financial  statements  in
conformity with generally accepted accounting principles requires
management  to  make estimates and assumptions  that  affect  the
reported  amounts  of assets and liabilities  and  disclosure  of
contingent assets and liabilities at the date of the consolidated
financial  statements and the reported amounts  of  revenues  and
expenses  during  the  reporting period.   Actual  results  could
differ from those estimates.

Note 3.        Summary   of   Significant   Accounting   Policies
          (Consolidated Statement of Net Assets in Liquidation as
          of  September  30, 1997 and Consolidated  Statement  of
          Changes in Net Assets in Liquidation For the Three  and
          Nine  Months  Ended  September 30, 1997  -  Liquidation
          Basis of Accounting)

All  statements contained herein, as well as statements  made  in
press  releases  and  oral statements that may  be  made  by  the
Partnership,  the  General Partner or by officers,  directors  or
employees  of  the  General Partner acting on  the  Partnership's
behalf,  that  are not statements of historical fact,  constitute
"forward-looking statements" within the meaning  of  the  Private
Securities  Litigation Reform Act of 1995.  Such  forward-looking
statements  involve  known and unknown risks,  uncertainties  and
other  factors  that  could  cause  the  actual  results  of  the
liquidation  or  operations of the Partnership to  be  materially
different  from  historical results or from  any  future  results
expressed  or implied by such forward-looking statements.   Among
the  factors  that  could materially affect such  forward-looking
statements are the following:  market conditions in the  mortgage
banking  industry, prevailing interest rates, the realization  of
contingent  payments owing to the Partnership, the  Partnership's
ability  to  dispose of its remaining assets at expected  prices,
the  settlement  of and provision for contingent liabilities  and
claims,  the  length of time required to complete the disposition
of the Partnerships assets and the Partnership's liquidation, the
actual  costs  incurred in the liquidation, general business  and
economic conditions and other risk factors described from time to
time  in  the  Company's reports filed with  the  Securities  and
Exchange  Commission  ("SEC").  All  cautionary  statements  made
herein  should be read as being applicable to all forward-looking
statements  by  or  on  behalf of the Partnership  wherever  they
appear, including, but not limited to, all subsequent written and
oral forward-looking statements.

Basis  of  Presentation  - The condensed  consolidated  financial
statements primarily include the accounts of HBT, HMCLP, and HFC.
All  intercompany accounts and transactions have been  eliminated
in  consolidation. As a result of the Partnership's determination
to  liquidate  during January 1997 (see Note 4), the  Partnership
has changed its basis of accounting from a going concern basis to
a  liquidation basis of accounting.  Under the liquidation  basis
of  accounting,  carrying  values  of  assets  are  presented  at
estimated net realizable values and liabilities are presented  at
estimated   settlement  amounts.   The  basis   for   determining
estimated net realizable values and estimated settlement  amounts
are   described  below.  At  March  31,  1997,  certain   secured
obligations were offset against the related assets.  However,  at
September  30, 1997, secured obligations were not offset  against
the related assets.


Mortgage  Loans  Held for Investment - Mortgage  loans  held  for
investment  are  stated  at the amount of  unpaid  principal  and
accrued interest, reduced by an allowance for loan losses,  based
upon  management's  evaluation  of  the  economic  conditions  of
borrowers,  loan  loss  experience, collateral  value  and  other
relevant  factors,  which approximates estimated  net  realizable
value.

Investment  in Loans Repurchased from GNMA Pools - The investment
in  loans  repurchased from GNMA pools consists of the amount  of
unpaid  principal,  interest, and funds  advanced  for  mortgagor
escrow deficits, foreclosures and other investor requirements.  A
reserve  for  uncollectible items (based on loan types  and  loan
loss experience) has been established for those receivables which
management estimates are not recoverable. The investment in loans
repurchased  from  GNMA  pools  approximates  its  estimated  net
realizable  value at September 30, 1997 except for  certain  loss
reserves  which  are  included  in  foreclosure,  repurchase  and
indemnification   reserves   in   the   accompanying    condensed
consolidated statement of net assets in liquidation.

Advances  Receivable  - Advances receivable,  which  approximates
estimated  net  realizable value, represents funds  advanced  for
mortgagor  escrow  deficits,  foreclosures  and  other   investor
requirements and are generally recoverable from the  insurers  or
guarantors,  which  are  generally government  agencies,  or  the
mortgagors through increased monthly payments, as applicable.   A
reserve  for  uncollectible items (based on loan types  and  loan
loss  experience)   has  been established for  those  receivables
which  management estimates are not recoverable and is  reflected
in  foreclosure, repurchase and indemnification reserves  in  the
accompanying financial statements.

Mortgage Servicing Rights - Mortgage servicing rights are  stated
at  their  net  estimated realizable value which  was  determined
based on agreements in principle reached on September 30, 1997.

Foreclosure,   Repurchase   and   Indemnification   Reserves    -
Foreclosure reserves are maintained to provide for an estimate of
the  losses  associated  with  delinquent  loans  and  loans   in
foreclosure  or bankruptcy in which the Partnership services  and
retains   certain   recourse  obligations.   The   reserves   are
established  based  on management's expectations  and  historical
loss experience.

As  part of its production operations, the Partnership is subject
to  certain repurchase and indemnification provisions through its
contractual  agreements  with the investors  to  which  it  sells
mortgage  loans.  These  provisions generally  provide  that  the
Partnership repurchase from the investor,  i) loans in which  the
borrower defaults on the first payment, ii) loans which have  not
been  insured  by  the  government in  a  timely  manner  or  are
uninsurable,  and  iii) mortgage loans in  which  an  origination
(i.e.,   underwriting)  defect  is  discovered.   The   investor,
however,  may  require the Partnership to indemnify them  against
future losses that might result rather than repurchase the  loan.
The  reserve is based on management's expectations and historical
loss experience.

Other  Assets and Liabilities - All other assets and  liabilities
not  described  above are stated at book value  which  management
believes  approximates estimated realizable values and  estimated
settlement  amounts.  In addition, in accordance with liquidation
basis   accounting,   a  liability  has  been   established   for
anticipated  operating expenses in excess of  operating  revenues
during the anticipated liquidation period.

Note 4.   Liquidation of Partnership

On  January  31, 1997, pursuant to the HBT Agreement (as  amended
and  restated)  the  Board of Directors of  the  General  Partner
determined that there was a substantial risk that an Adverse  Tax
Consequence  (as defined below) would occur within one  year  and
that  it  was  in the best interests of the Partnership  and  the
holders of beneficial interests in the Partnership (collectively,
"Unitholders") to sell or otherwise dispose of all of the  assets
of  the  Partnership and to liquidate the Partnership as soon  as
reasonably  practicable.  Pursuant to Section  8.10  of  the  HBT
Agreement,  in  the  event  that the General  Partner  reasonably
believes that within one year there is a substantial risk of  the
Partnership  being treated for federal income tax purposes  as  a
corporation (an "Adverse Tax Consequence") as a result of,  among
other  things,  a  reclassification  of  the  Partnership  as   a
corporation under the Revenue Act of 1987 (the " 1987  Act")  for
its  first  taxable year beginning after December 31,  1997,  the
General  Partner  may  take  certain actions  (described  further
below),  including the liquidation of the Partnership,  upon  not
less  than 30 days prior written notice to the Partners  and  the
Unitholders  unless,  prior to the taking  of  such  action,  the
Unitholders shall have voted against such action by a vote of  at
least  two-thirds  of all Limited Partnership  Interests  in  the
Partnership.  Affiliates of HBT and the General Partner  are  the
owners  of  approximately  85%  of  the  issued  and  outstanding
Preferred Units, and thus, no vote will be taken.
     
Under  existing  tax  law,  the  Partnership  is  treated  as   a
partnership and is not separately taxed on its earnings.  Rather,
income  (or  loss)  of  the  Partnership  is  allocated  to   the
Unitholders pursuant to the terms of the HBT Agreement (see  Note
1)  and  is  included  by  them in determining  their  individual
taxable  incomes, subject to certain special rules applicable  to
publicly  traded  partnerships.  By contrast,  a  corporation  is
subject to tax on its net income and any dividends or liquidating
distributions paid to stockholders are then subject to  a  second
tax  at  the  stockholder level.  Accordingly, under current  tax
law,  the  Partnership enjoys a tax advantage  over  a  similarly
situated entity which is taxed as a corporation.
     
The  1987 Act generally requires publicly traded partnerships  to
be  taxed  as corporations. However, under the 1987 Act  existing
partnerships, such as the Partnership, were allowed  to  continue
to be treated as partnerships for federal income tax purposes for
all taxable years commencing on or prior to December 31, 1997.

From  time  to time, legislation has been introduced in  Congress
that  would  have the effect of extending the December  31,  1997
grandfather   date   or  eliminating  altogether   the   relevant
provisions  of  the  1987 Act.  Subsequent to  the  Partnership's
decision on January 31, 1997 to liquidate, legislation passed  as
part of the Taxpayer Relief Bill of 1997, that was signed by  the
President  on  August  5,  1997, that will  tax  publicly  traded
partnerships  3.5% of its gross income from operations  beginning
January  1,  1998.   This  provision was not  beneficial  to  the
Partnership for two reasons.  First, the legislation  was  passed
after  the  plan of liquidation was nearly complete and secondly,
the  cost of the 3.5% tax on gross income is a greater tax burden
that the tax cost of operating as a corporation.

Pursuant  to  Section  8.10  of the HBT  Agreement,  the  General
Partner  had  the  right to take one of several actions  when  it
believed  there  was  a  substantial risk  that  an  Adverse  Tax
Consequence  will  occur  within one  year.   For  instance,  the
General  Partner  had  the power to (a)  modify,  restructure  or
reorganize  the  Partnership as a corporation, a trust  or  other
type of legal entity, (b) liquidate the Partnership, (c) halt  or
limit trading in the Units or cause the Units to be delisted from
the NYSE, or (d) impose restrictions on the transfer of Units.

The  General Partner believed that the consolidation taking place
in  the  mortgage  banking industry made  it  difficult  for  the
Partnership to compete effectively with market participants  that
are  larger  and  more  readily  able  to  recognize  substantial
economies of scale in their operations than the Partnership.  The
General  Partner  believed  that its  competitive  tax  structure
advantage  of  operating  as a partnership  would  be  eliminated
beginning  January  1, 1998.  This belief was  confirmed  by  the
legislation  that was passed on August 5, 1997  that  assessed  a
3.5%  tax on gross income of publicly traded partnerships.  These
factors  weighed  in favor of liquidating the Partnership  rather
than  attempting  to continue the Partnership's business  in  its
present or some other form.

Although no assurances can be given, the General Partner believes
that  substantially  all  of  the  Partnership's  assets  can  be
disposed of and liabilities can be settled in an orderly  fashion
and  that  the  net  proceeds thereof can be distributed  to  its
Preferred Unitholders by the end of 1997.

Disposition of Assets - See "Management's Discussion and Analysis
of Financial Condition and Results of Operations - Liquidation of
Assets"

Wind  Down of Operations - Upon completion of the disposition  of
the  Partnership's  assets  and settlement  of  liabilities,  the
Partnership will be required to wind down the operations  of  the
disposed  units  including, without limitation,  the  production,
servicing  and related general administration functions including
financial reporting and accounting.  Upon completion of the  wind
down  functions,  the Partnership will be required  to  terminate
employees  not  hired  by  the purchasers  of  the  Partnership's
business  units.  Towards this end, the Partnership has announced
and  provided  notice  of  termination (in  accordance  with  the
Worker's Adjustment and Retraining Notification Act, WARN) to all
employees  located  in  its  corporate  headquarters  located  in
Aurora,  Colorado.   Accordingly,  at  September  30,  1997,  the
Partnership  has provided for anticipated severance  costs  which
include  a  component  to induce certain  notified  employees  to
remain  until the liquidation is complete in order to ensure  the
Partnership meets all obligations to its investors and creditors.

Liquidating  Distribution - Once the assets  of  the  Partnership
have been sold and the Partnership's creditors have been paid  in
full,  or adequate provision for such payment has been made,  the
General  Partner  will cause the Partnership to  pay  liquidating
distributions to Unitholders upon the surrender of  their  Units.
While   the   exact   timing  and  nature  of   any   liquidating
distributions  cannot be precisely determined at this  time,  the
Partnership expects to make such distributions during  the  month
of  December  1997.   However,  because  of  the  nature  of  the
Partnership's  business,  it  is possible  that  Unitholders  may
receive  a  portion  of their distributions in  the  form  of  an
interest  in  another entity, such as a liquidating  trust.   Any
such interests would not, in all likelihood, be transferable by a
Unitholder.

During  the  fourth  quarter of 1997, the Partnership  may  incur
additional   expense   and  liabilities   associated   with   its
liquidation, including, without limitation, expenses incurred  in
connection  with the disposition of its business  operations  and
its  winding down.  In order for distributions to be made to  the
Unitholders at the end of 1997, the General Partner will have  to
make  provision for the post-1997 liabilities of the Partnership,
by  means  of  a liquidating trust, an arrangement  with  another
entity (including an affiliate of its General Partner), or  other
procedure.   The  post-1997 liabilities represent obligations  of
the Partnership which will survive beyond December 31, 1997, such
as  indemnification  or repurchase obligations  with  respect  to
mortgage  loans and servicing rights sold or to be sold in  prior
periods or in 1997 or indemnification obligations with respect to
business  operations  sold or to be sold  in  1997.   The  actual
amount  of  such  additional  expenses  to  be  incurred  by  the
Partnership  in the fourth quarter of 1997 may be different  from
those  estimated and is dependent in part on factors  beyond  the
Partnership's control, such as the timing and difficulty  of  the
disposition  of  the  Partnership's assets and  the  winding-down
process.    In addition, the net amount ultimately available  for
distribution  from  the liquidated Partnership  depends  on  many
unpredictable factors, such as the amounts ultimately realized on
the  sale  of the remaining assets, carrying costs of the  assets
prior  to  sale, collection of receivables, settlement of  claims
and  commitments,  the  amount of revenue  and  expenses  of  the
Partnership until completely liquidated and other uncertainties.

Federal Income Tax Consequences of Liquidation - Any taxable gain
or  loss recognized by the Partnership on the sale of its  assets
in  connection with the liquidation will be allocated  among  the
Partners  for  income  tax purposes in accordance  with  the  HBT
Agreement.  Assuming that a Partner's interest in the Partnership
is  liquidated  entirely for cash during 1997, then  the  Partner
will realize gain or loss to the extent that the cash received is
greater  or less than the Partner's adjusted income tax basis  in
his  or  her  partnership  interest,  and  the  Partner  will  be
permitted  to  claim any losses from the Partnership  which  were
previously  suspended  under  the  rules  regarding  losses  from
passive  activities.  Special rules would apply,  however,  if  a
Partner did not receive a full distribution in cash of his or her
interest in the Partnership during the year. After the payment of
or  provision for all debts, liabilities and obligations and  the
allocation  of  income  (loss),  liquidating  distributions   are
allocated  to  the General Partner and Preferred and Subordinated
Unitholders  in  accordance  with  and  in  proportion  to  their
respective  capital account balances as determined in  accordance
with the HBT Agreement.

Note 5.   Contingencies

During the third quarter of 1997, HMCLP was sued in the state  of
Colorado  by  a  mortgagor,  in which  HMCLP  was  servicing  the
mortgage loan, alleging, on behalf of the mortgagor and on behalf
of an alleged class of similarly situated mortgagors that certain
escrow refunds were not made in a timely manner.  Discussions  to
dismiss  this case have been made with the Plaintiff's attorneys.
If   not  dismissed,  management  intends  to  defend  this  case
vigorously.

Item  2.    Management's  Discussion and  Analysis  of  Financial
Condition and Results    of Operations

All  statements contained herein, as well as statements  made  in
press  releases  and  oral statements that may  be  made  by  the
Partnership,  the  General Partner or by officers,  directors  or
employees  of  the  General Partner acting on  the  Partnership's
behalf,  that  are not statements of historical fact,  constitute
"forward-looking statements" within the meaning  of  the  Private
Securities  Litigation Reform Act of 1995.  Such  forward-looking
statements  involve  known and unknown risks,  uncertainties  and
other  factors  that  could  cause  the  actual  results  of  the
liquidation  or  operations of the Partnership to  be  materially
different  from  historical results or from  any  future  results
expressed  or implied by such forward-looking statements.   Among
the  factors  that  could materially affect such  forward-looking
statements are the following:  market conditions in the  mortgage
banking  industry, prevailing interest rates, the realization  of
contingent  payments owing to the Partnership, the  Partnership's
ability  to  dispose of its remaining assets at expected  prices,
the  settlement  of and provision for contingent liabilities  and
claims,  the  length of time required to complete the disposition
of the Partnerships assets and the Partnership's liquidation, the
actual  costs  incurred in the liquidation, general business  and
economic conditions and other risk factors described from time to
time  in  the  Company's reports filed with  the  Securities  and
Exchange  Commission  ("SEC").  All  cautionary  statements  made
herein  should be read as being applicable to all forward-looking
statements  by  or  on  behalf of the Partnership  wherever  they
appear, including, but not limited to, all subsequent written and
oral forward-looking statements.

The  following  is management's discussion and  analysis  of  the
financial condition and results of operations of the Partnership.
The  discussion  and analysis should be read in conjunction  with
the financial statements included herein.

The  decrease in the Partnership's net assets in liquidation from
approximately $57.6 million (or $1.40 per Unit) at March 31, 1997
to  approximately $42.4 million (or $1.03 per Unit) at  September
30, 1997 is attributable to the following:  i) an increase in the
Partnership's  foreclosure  and  repurchase  and  indemnification
reserves  of  approximately  $8.5  million  (representing  a  net
increase of approximately $3.8 million from June 30, 1997), ii) a
decrease   in   the  estimated  net  realizable  value   of   the
Partnership's  mortgage servicing rights  of  approximately  $3.6
million (based on actual realized sales that occurred during  the
third and fourth quarters of 1997 and representing a net decrease
in  estimated realizable value of approximately $.6 million  from
June  30,  1997), iii) a decrease in the estimated net realizable
value  of  the  Partnership's fixed assets of  approximately  $.3
million (based on actual realized sales that occurred during  the
third  quarter of 1997), and iv) an increase in the Partnership's
estimate  of liquidation costs of approximately $2.9 million,  of
which $5.7 million has already been incurred.  This represents  a
net  increase  of $.6 million from June 30, 1997, of  which  $3.5
million was incurred during the quarter ended September 30, 1997.

The   higher   foreclosure  and  repurchase  and  indemnification
reserves  reflect i) the occurrence of foreclosure  losses  at  a
higher rate than previously forecast and a corresponding increase
in  the  Partnership's estimate of future foreclosure losses  and
ii) the assertion against the Partnership of a greater volume  of
repurchase  claims than previously forecast and  a  corresponding
increase  in  the Partnership's estimate of such  claims  in  the
future. Additional facts that become known during the anticipated
liquidation  period  could  increase  or  decrease  the   reserve
recorded at September 30, 1997.

The  increase in the Partnership's estimate of liquidation  costs
of  approximately $2.9 million is due primarily to the occurrence
of  and an increase in future accruals for i) legal costs and ii)
administrative  services costs related to the  wind-down  of  the
Partnership through the end of the fiscal year.  These  increases
are  due  in part to a lengthening of time required to  liquidate
the Partnership.

The  Partnership  currently  estimates  that  the  amount  to  be
received  in  liquidation by its Preferred  Unitholders  will  be
approximately  $1.03  per  unit.  Such estimated  value  involves
known  and  unknown risks, uncertainties and other  factors  that
could cause the actual liquidation value of the Partnership to be
materially different from the estimated value.  Among the factors
that  could  materially  affect  such  estimated  value  are  the
following:  the realization of contingent payments owing  to  the
Partnership  (affected  by  market  conditions  in  the  mortgage
banking   industry   and   prevailing   interest   rates),    the
Partnership's  ability  to dispose of  its  remaining  assets  at
expected  prices, the settlement of and provision for  contingent
liabilities  and claims, including the Partnership's  foreclosure
reserve   and   reserve   for  indemnification   and   repurchase
obligations  with respect to mortgage loans and servicing  rights
sold, the length of time required to complete the disposition  of
the   Partnership's   remaining  assets  and  the   Partnership's
liquidation,  the  actual  costs  incurred  in  the  liquidation,
general  business and economic conditions and other risk  factors
described  from time to time in the Company's reports filed  with
the Securities and Exchange Commission.

Recent Developments

Liquidation of Partnership and Subsequent Events
On  January  31, 1997, pursuant to the HBT Agreement (as  amended
and  restated)  the  Board of Directors of  the  General  Partner
determined that there was a substantial risk that an Adverse  Tax
Consequence  (as defined below) would occur within one  year  and
that  it  was  in the best interests of the Partnership  and  the
holders of beneficial interests in the Partnership (collectively,
"Unitholders") to sell or otherwise dispose of all of the  assets
of  the  Partnership and to liquidate the Partnership as soon  as
reasonably  practicable.  Pursuant to Section  8.10  of  the  HBT
Agreement,  in  the  event  that the General  Partner  reasonably
believes that within one year there is a substantial risk of  the
Partnership  being treated for federal income tax purposes  as  a
corporation (an "Adverse Tax Consequence") as a result of,  among
other  things,  a  reclassification  of  the  Partnership  as   a
corporation under the Revenue Act of 1987 (the " 1987  Act")  for
its  first  taxable year beginning after December 31,  1997,  the
General  Partner  may  take  certain actions  (described  further
below),  including the liquidation of the Partnership,  upon  not
less  than 30 days prior written notice to the Partners  and  the
Unitholders  unless,  prior to the taking  of  such  action,  the
Unitholders shall have voted against such action by a vote of  at
least  two-thirds  of all Limited Partnership  Interests  in  the
Partnership.  Affiliates of HBT and the General Partner  are  the
owners  of  approximately  85%  of  the  issued  and  outstanding
Preferred Units, and thus, no vote was taken.
     
Liquidation of Assets

During  the  first  quarter of 1997, the  Partnership  began  the
process  of  liquidating  its  assets.  The  disposition  of  the
Partnership's  significant  assets can  be  summarized  into  the
following  categories:  i) wholesale production  operations,  ii)
retail  production  operations, iii) remaining servicing  assets,
iv) servicing operation, and v) other assets.

Wholesale Production Operations
On  March 31, 1997, the Partnership's subsidiary, HMCLP, sold its
wholesale loan production branch operations to CrossLand Mortgage
Corp.  ("CrossLand"), a subsidiary of First Security Corporation,
for  approximately $4 million in cash.  In addition,  HMCLP  will
receive  an  earnout  payment based on  the  aggregate  principal
amount of loans generated, between $1.5 billion and $4.0 billion,
from  the  transferred  facilities  during  the  thirteen  months
following  the closing date of March 31, 1997.  If the  aggregate
principal  amount of loans generated is less than  $1.5  billion,
the  Partnership  will  not  receive  an  earnout  payment.    If
CrossLand   maintains   the  same  volume   of   wholesale   loan
originations  as  HMCLP experienced in 1996  (approximately  $2.8
billion),  this  earnout payment would total  approximately  $3.3
million.    For  the  seven  months  ended  October   31,   1997,
CrossLand's  wholesale loan origination volume  exceeded  HMCLP's
1996  wholesale  loan  origination volume for  the  same  period.
Accordingly,  management has established a  receivable  for  this
actual  and future estimated amount, totaling approximately  $4.3
million, which is recorded as a component of other assets in  the
accompanying   September   30,   1997   consolidated    financial
statements.  The purchase did not include the wholesale  mortgage
loan  pipeline being processed by HMCLP at the time of the  sale.
These  excluded  loans  were processed  and  closed  for  HMCLP's
account  by  CrossLand  pursuant to  an  administrative  services
agreement between the parties.
     
Retail Production Operations
On  March  19,  1997, HMCLP sold a majority of  its  retail  loan
production branch operations to an unaffiliated third  party  for
an  amount approximately equal to the net book value of the fixed
assets owned by the retail branches. The purchase did not include
the retail mortgage loan pipeline being processed by HMCLP at the
time of the sale.  These excluded loans were processed and closed
for  HMCLP's account by the unaffiliated third party pursuant  to
an  administrative services agreement between the  parties.   The
remaining  retail branches were either closed or sold  subsequent
to March 31, 1997.

Servicing Assets and Servicing Operations
Effective April 30, 1997, the Partnership executed a purchase and
sale agreement with an unrelated third party for the sale of  the
Partnership's servicing rights related to non-recourse  FNMA  and
Freddie  Mac loans and GNMA loans with unpaid principal  balances
totaling  approximately  $1.5  billion.   The  transfer  of   the
servicing  responsibilities occurred in July 1997. Net  proceeds,
which were substantially collected in July and August 1997,  from
the  sale approximated $25.7 million and were used to reduce  the
Partnership's servicing facility.

Effective  July  31, 1997, the Partnership sold to  an  unrelated
third-party approximately $1.1 billion of its remaining servicing
portfolio   and   its  National  Servicing  Center   located   in
Scottsbluff,  Nebraska.  The Partnership expects to  receive  net
proceeds,  after transaction and transfer costs, of approximately
$18.4  million from this sale.  Proceeds received  to  date  were
used  to  reduce Harbourton's debt.  The Partnership's  Servicing
Center,  including the operations, facilities, fixed  assets  and
employees, was sold along with the Partnership's GNMA pool buyout
and  reinstatement unit, its streamline refinance capability  and
certain   fixed   assets   located  in   Aurora,   Colorado   for
approximately $1.85 million.

In connection with the sales of the National Servicing Center and
of  the $1.1 billion servicing portfolio, Harbourton entered into
an  Administrative  Services Agreement with a subsidiary  of  the
unaffiliated  third party pursuant to which the  subsidiary  will
perform, on a fee basis, certain services on Harbourton's behalf,
including  various  ongoing  servicing  and  loan  administration
functions.

The  Partnership  has  negotiated  with  two  unaffiliated  third
parties  to sell its remaining servicing portfolio available  for
sale  with  unpaid principal balances totaling approximately  $85
million.  Agreements in principle were reached on  September  30,
1997. The carrying value of the servicing is reflected at its net
realizable  value,  based upon these sales transactions,  in  the
accompanying   September   30,   1997   consolidated    financial
statements.

Mortgage Loans Held for Investment
During  the first quarter of 1997, the Partnership sold a portion
of  its  mortgage  loans held for investment  portfolio  totaling
approximately  $3.0  million  to an  unrelated  third  party  for
approximately  $2.8 million.  An unrealized loss of approximately
$0.2   million  was  provided  for  in  the  December  31,   1996
consolidated financial statements and realized during  the  first
quarter of 1997.

Subsequent  to June 30, 1997, the Partnership sold a  portion  of
its   mortgage  loans  held  for  investment  portfolio  totaling
approximately  $3.3  million  to an  unrelated  third  party  for
approximately   $3.1  million.   It  is  anticipated   that   any
additional  mortgage  loans  repurchased  during  1997  and   the
remaining  portfolio  will be marketed  and  sold  in  a  similar
fashion.  A reserve for anticipated future repurchase losses  has
been established at September 30, 1997.

CMO Bonds, Residual Interests, Investment Securities and SMATs
During  the first quarter of 1997, the Partnership sold  its  CMO
bond  and  residual interest portfolio, except for  certain  non-
economic  residual interests (with a book value of $0),  totaling
approximately  $1.2  million  to  unrelated  third  parties   for
approximately  $3.1 million.  An unrealized gain of approximately
$1.9  million was provided for, in accordance with SFAS No.  115,
in the December 31, 1996 consolidated financial statements.

During  the  second  quarter of 1997, the  Partnership  sold  its
remaining   portfolio  for  approximately  $0.7   million   which
approximated its net realizable value reflected in the March  31,
1997 consolidated financial statements.

Investment in Loans Repurchased from GNMA Pools
At   April   30  and  August  31,  1997,  the  Partnership   sold
approximately  $35 million and $10 million, respectively  of  its
investment  in  loans repurchased from GNMA  pools  to  unrelated
third parties for an amount that approximated its net book value.
The  Partnership  is  negotiating a  sales  transaction  with  an
unrelated third party with respect to its remaining investment in
loans  repurchased from GNMA pools.  The Partnership  expects  to
sell  these assets for an amount that approximates their net book
value at September 30, 1997.

Other
During  the  third  quarter  of 1997, the  Partnership  sold  its
remaining  property, plant and equipment and mortgage loans  held
for sale for an amount that approximated their net book value.

The   Partnership  will  market  and  dispose  of  its  remaining
operating  receivables and operating payables which are reflected
at  their  current estimated liquidation amounts  and  settlement
amounts, respectively, in the accompanying consolidated statement
of net assets in liquidation as of September 30, 1997.  Operating
receivables  (reflected  as  other  assets  in  the  accompanying
consolidated   financial  statements)   consists   primarily   of
production   operation   receivables,  mortgage   loan   interest
receivables,   trade  receivables,  and  prepaid  assets   (e.g.,
insurance   and   maintenance  contracts).   Operating   payables
(reflected  as  accounts  payable and other  liabilities  in  the
accompanying   consolidated   financial   statements)    consists
primarily of production operation payables, interest payables  on
lines  of  credit  and  other debt, and  trade  payables  and  an
estimate  of  operating expenses in excess of operating  revenues
expected to be incurred through liquidation.  The actual  amounts
realized from the sale of the Partnership's assets and the actual
settlement  amounts  of  the Partnership's remaining  liabilities
could differ materially from their current carrying values.

Reduction in Borrowing Facilities

On September 30, 1997, the Partnership terminated all of its bank
borrowing   facilities.   The  Partnership's  notes  payable   to
affiliates were paid off subsequent to September 30, 1997.

Resignation of Officers

Mr.   Rick   Skogg  (President  and  Chief  Operating   Officer),
Mr.  Paul  Szymanski (Executive Vice President,  Chief  Financial
Officer  and  Secretary),  and Mr. Lee Trautman  (Executive  Vice
President),   have  resigned  and  accepted  positions   with   a
subsidiary  of  the unaffiliated third party that  purchased  the
servicing  rights  and the National Servicing Center  located  in
Scottsbluff, Nebraska subsequent to June 30, 1997.  Mr. Skogg has
also resigned as a director of Harbourton.

                   PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings

During the third quarter of 1997, HMCLP was sued in the state  of
Colorado  by  a  mortgagor,  in which  HMCLP  was  servicing  the
mortgage loan, alleging, on behalf of the mortgagor and on behalf
of an alleged class of similarly situated mortgagors that certain
escrow refunds were not made in a timely manner.  Discussions  to
dismiss  this case have been made with the Plaintiff's attorneys.
If   not  dismissed,  management  intends  to  defend  this  case
vigorously.

Item 2.   Changes in Securities

None.

Item 3.   Defaults Upon Senior Securities

None.

Item 4.   Submission of Matters to a Vote of Security Holders

None.

Item 5.   Other Information

None.

Item 6.   Exhibits and Reports on Form 8-K

a.  Exhibits:

1)    The  Asset  Purchase Agreement between Harbourton  Mortgage
  Co., L.P. and Lehman Brothers Holdings Inc., dated July 31, 1997
2)   The Mortgage Servicing Purchase and Sale Agreement between
Harbourton Mortgage Co., L.P. and Lehman Brothers Holdings Inc.,
dated July 31, 1997



b.  Reports on Form 8-K:

          Not Applicable

                           SIGNATURES
                                
Pursuant  to  the  requirements of Section 13  or  15(d)  of  the
Securities  Exchange Act of 1934, the registrant has duly  caused
this  report  to  be  signed on its behalf  by  the  undersigned,
thereunto duly authorized.
                 HARBOURTON MORTGAGE CO., L.P.

                     By:   Harbourton  Mortgage Corporation,  its
General Partner


Signatures            Title                        Date
                                                   
s/ Jack W. Schakett   Chief Executive Officer and  November   26,
                      Director of                  1997
Jack W. Schakett      the     General     Partner  
                      (Principal        Executive
                      Officer)
                                                   
s/ Bill L. Reid III   Chief Accounting Officer     November   26,
                                                   1997
Bill L. Reid III                                   


                    ASSET PURCHASE AGREEMENT

          ASSET PURCHASE AGREEMENT (the "Agreement"), made this
31st day of July, 1997, by and between HARBOURTON FINANCIAL
SERVICES L.P., a Delaware limited partnership (the "Seller"), and
LEHMAN BROTHERS HOLDINGS INC., a Delaware corporation
("Purchaser").
          
          WHEREAS, Seller, through certain subsidiaries, owns and
operates a mortgage servicing business (including GNMA pool
buyout and reinstatement services and GNMA streamline refinance
services) through its National Servicing Center in Scottsbluff,
Nebraska and headquarters in Aurora, Colorado ("NSC"); and
          
          WHEREAS, upon the terms and conditions set forth
herein, Seller desires to cause its subsidiaries, Harbourton
Mortgage Co., L.P. ("HMC") and Harbourton Funding Corporation
("HFC") (each a "Selling Affiliate" and collectively, the
"Selling Affiliates") to sell, and Purchaser desires to purchase
or cause a subsidiary (the "Designee") to purchase, certain of
the assets of, and assume certain related liabilities of Seller
relating to, NSC (in each case subject to certain exceptions)
(the "Purchased Assets").
          
          NOW, THEREFORE, in consideration of the premises and
the respective representations, warranties and covenants
contained herein, the parties hereto hereby agree as follows:
          
                            ARTICLE I
                           DEFINITIONS
          
          l.1  Certain Definitions.  As used in this Agreement,
the following terms shall have the respective meanings ascribed
to them in this Section:

               "Affiliate" means, as to any party, any entity
     which directly or indirectly, is in control of, is
     controlled by, or is under common control with, such party;
     and any officer or director of such party.   For purposes of
     this definition, an entity shall be deemed to be "controlled
     by" a party if the party possesses, directly or indirectly,
     power either to (i) vote 50% or more of the securities
     (including convertible securities) having ordinary voting
     power for the election of directors of such entity or (ii)
     direct or cause the direction of the management or policies
     of such entity whether by contract or otherwise; provided,
     however, that for purposes of Section 3.18, the term
     "Affiliate" shall be limited to any person who would be
     treated as a member of a controlled group under Section 4001
     of ERISA or Section 414 of the Code.
               
               "Authority" means any federal, state, provincial
     or local, or any foreign governmental or regulatory agency
     or authority.
               
               "Business Day" means any day other than a
     Saturday, Sunday, or a day on which banking institutions in
     New York, New York are authorized or obligated by law or
     executive order to close.
               
               "Code" means the US Internal Revenue Code of
     1986, as amended.
               
               "Colorado Location" means Suite 601, 2530 So.
     Parker Road, Aurora, Colorado.
               
               "Employee" means a salaried or hourly employee of
     Seller whose services are rendered primarily for the benefit
     of NSC.
               
               "ERISA" means the Employee Retirement Income
     Security Act of 1974, as amended.
               
               "Interim Expenses" means the out-of-pocket
     expenses incurred prior to the Closing Date by Seller and
     the Selling Affiliates for the benefit of Purchaser which
     are described on Schedule 2.1(l) hereto.
               
               "Loss" or "Losses" means all claims, losses,
     damages, liabilities, assessments, fines, judgments,
     consultants' fees, administrative costs, actions, suits,
     proceedings, interest, penalties and expenses (including
     settlement costs and any reasonable legal or other expenses
     for investigating or defending any actions or threatened
     actions or for enforcing rights of indemnity and defense)
     (individually a "Loss" and collectively "Losses").
               
               "Liability" means any direct or indirect
     liability, indebtedness, obligation, expense, claim, loss,
     damage, deficiency, guaranty or endorsement of or by any
     Person, absolute or contingent, primary or secondary,
     accrued or unaccrued, due or to become due, liquidated or
     unliquidated.
               
               "Nebraska Location" means 601 Fifth Avenue and
     615 S. Beltline East, Scottsbluff, Nebraska, and the
     surrounding area of real estate owned by the Selling
     Affiliates and utilized by Selling Affiliates to conduct the
     NSC business.
               
               "Person" means an individual, a corporation, a
     limited liability company, a partnership, an association, an
     Authority, a trust or other entity or organization.
               
               "Section 4 Material Adverse Effect" means a
     material adverse effect on, or material adverse change in,
     the ability of Purchaser to perform its obligations under
     this Agreement or any other agreement contemplated hereby.
               
               "Section 3 Material Adverse Effect" means a
     material adverse effect on, or material adverse change in,
     (i) the Purchased Assets or (ii) the ability of Seller to
     perform its obligations under this Agreement or any other
     agreement contemplated hereby.
               
               "Securities Act" means the Securities Act of
     1933, as amended.
               
               "Taxes" means all federal, state, local, foreign
     and other net income, gross income, gross receipts, sales,
     use, ad valorem, transfer, franchise, property, license,
     withholding, payroll, employment, excise, occupation,
     premium or other tax, fee, or assessment imposed by any
     governmental authority including interest penalties and
     other additions imposed with respect thereto.
               
               "Tax Return" means any return, declaration,
     report, claim for refund, or information return or statement
     relating to Taxes, including any schedule or attachment
     thereto, and including any amendment thereof.
               
               "Transaction Documents" means this Agreement, the
     Assumption Agreement, the Warranty Deed, the Bill of Sale,
     the Guaranty and the Transition Services Agreement.
               
               "Transactions" means the purchase and sale of the
     Purchased Assets and the other transactions contemplated by
     any Transaction Documents.
               
               "Transition Services Agreement" means the
     Administrative Services Agreement to be executed between
     Purchaser and Seller on the Closing Date in substantially
     the form attached as Exhibit C.
          
          1.2  Other Defined Terms.  The following terms are
defined elsewhere in this Agreement:
          
               Term                                    Section

               Agreement                               Background
               Assigned Contracts                      2.1(m)
               Assigned Subservicing Contracts         2.1(b)
               Assumption Agreement                    2.3
               Assumed Liabilities                     2.3
               Bill of Sale                            2.7(b)(i)
               Closing                                 2.7(a)
               Closing Date                            2.7(a)
               Colorado Personal Property              2.1(d)
               Customer List                           2.1(g)
               Designated Employees                    5.12(a)
               DOJ                                     3.4
               Environmental Laws                      3.14(a)
               Excluded Assets                         2.2
               FTC                                     3.4
               Guaranty
2.7(b)(viii)
               Inventory                               2.1(e)
               Liens                                   3.6(b)
               Materials of Environmental Concern      3.14(a)
               Multiemployer Plan                      3.18(e)
               Nebraska Real Property                  2.1(a)
               Necessary Permits                       3.14(f)
               Net Loss                                7.4(c)
               NSC Personal Property                   2.1(c)
               NSC Personal Property Depreciation Adjustment
2.6
               Plans                                   3.18(a)
               Prepaid Expenses                        2.1(1)
               Purchase Price                          2.6
               Purchased Assets                        Recitals
               Purchaser                               Background
               Purchaser's Health Plan                 5.12(d)
               Purchaser's Pension Plan                5.12(i)
               Purchaser's Savings Plan                5.12(h)(i)
               Representatives                         5.4
               Restricted Business                     5.13
               Restriction Period                      5.13
               Retained Liabilities                    2.4
               Seller                                  Background
               Seller's 401K Plan                      5.12(h)(i)
               Selling Affiliates                      Background
               Systems                                 2.1(f)
               Transferred Employees                   5.12(a)
               Transition Services Employees           5.12(a)
               Vacation Pay Liabilities                2.3(b)
               Vehicles                                2.1(k)
               Warranty Deed                           2.7(b)(ii)


                           ARTICLE II
                         THE TRANSACTION
          
          2.1  Sale and Purchase of Purchased Assets.  Upon the
terms and subject to the satisfaction or waiver of the conditions
set forth in this Agreement, and on the basis of the
representations, warranties, covenants and agreements set forth
in this Agreement, at the Closing, Seller shall transfer, sell,
convey, assign and deliver, or cause to be transferred, sold,
conveyed, assigned and delivered by the Selling Affiliates, to
Purchaser or its Designee, and Purchaser shall purchase and
accept or cause its Designee to accept from Seller and the
Selling Affiliates, all of Seller's and the Selling Affiliates'
right, title and interest in and to the Purchased Assets.
Subject to Section 2.2, the Purchased Assets shall include,
without limitation, the following:
          
               (a) all real property and leasehold interests and
     estates in real property located at the Nebraska Location
     and more particularly described on Schedule 2.1(a) hereto,
     together with all easements, privileges, rights-of-way,
     riparian and other water rights, lands underlying any
     adjacent streets or roads, appurtenances, licenses, permits
     and other rights pertaining to or accruing to the benefit of
     such real property and leasehold interests and estates in
     real property, and all buildings, structures, towers and
     improvements situated, mounted and located thereon
     (collectively, the "Nebraska Real Property");
               
               (b) the mortgage subservicing contracts listed on
     Schedule 2.1(b) hereto, together with such other mortgaging
     subservicing contracts as the parties hereto shall mutually
     agree on or prior to the Closing Date shall be transferred
     to the Purchaser or its Designee pursuant to the terms of
     the Mortgage Servicing Purchase and Sale Agreement executed
     by the Purchaser and Seller simultaneously herewith (the
     "Assigned Subservicing Contracts");
               
               (c) all computer equipment, computer terminals,
     furniture, furnishings and fixtures used or useful in the
     conduct of the operations of NSC which are listed or
     described on Schedule 2.1(c) hereto (plus or less any items
     acquired or disposed of in the ordinary course of business
     and in accordance with past practice), including, without
     limitation, the desks, chairs and computer terminals located
     at the Nebraska Location, and all warranties and guarantees,
     if any, express or implied, existing for the benefit of the
     Seller or any Selling Affiliate to the extent transferable (
     the "NSC Personal Property");
               
               (d) all computer equipment, computer terminals,
     furniture, furnishings and fixtures listed or described on
     Schedule 2.1(d) hereto (plus or less any items acquired or
     disposed of in the ordinary course of business and in
     accordance with past practice) located at the Colorado
     Location, and all warranties and guarantees, if any, express
     or implied, existing for the benefit of Seller or any
     Selling Affiliate to the extent transferable (the "Colorado
     Personal Property");
               
               (e) all materials, supplies, stationery, tools,
     employee manuals, training manuals, servicing manuals and
     policies, books, inventory, spare parts and other tangible
     personal property not otherwise set forth on another
     Schedule referred to in this Section 2.1 used in the conduct
     of the operations of NSC and maintained at the Nebraska
     Location or with respect to the Colorado Location, referred
     to on Schedule 2.1(e), and owned by the Seller or any
     Selling Affiliate on the Closing Date, together with any
     related intellectual property rights (except those expressly
     retained by Seller or a Selling Affiliate in accordance
     herewith) ("Inventory");
               
               (f) all management and other systems (including
     computers and peripheral equipment), data bases, computer
     software, computer discs and similar assets relating to the
     conduct of the operations of NSC which are listed or
     described on Schedule 2.1(f) hereto, together with any
     related intellectual property rights ("Systems");
               
               (g) the current customer list and potential
     customer lists associated with NSC (the "Customer List");
               
               (h) all technical or marketing information
     relating to NSC as well as such other information as is in
     the possession of NSC employees or in the possession of
     suppliers of information to NSC or customers of NSC,
     including new developments, inventions or ideas, and trade
     secrets and documentation thereof and all rights thereto
     related to NSC;
               
               (i) all business records, tangible data,
     documents, contracts, files, logs, and all other books and
     records, in each case relating to the Purchased Assets,
     Assumed Liabilities and NSC business to the extent permitted
     by law, provided that Seller and the Selling Affiliates may
     keep copies thereof;
               
               (j) copies of all business records, documents,
     files, logs, tax returns and other books and records, in
     each case relating to the Purchased Assets, Assumed
     Liabilities, Transferred Employees and NSC business to the
     extent the Seller or any Selling Affiliate is required to
     keep the originals;
               
               (k) all vehicles listed or described on Schedule
     2.1(k) hereto (the "Vehicles");
               
               (l) the prepaid expenses described on Schedule
     2.1(1) hereto (the "Prepaid Expenses"), including the
     Interim Expenses; and
               
               (m) the contracts, agreements and subscriptions
     listed on Schedule 2.1(m) hereto (the "Assigned Contracts").
          
          2.2  Excluded Assets.  Notwithstanding anything to the
contrary contained in this Agreement, the Purchased Assets shall
not include, and Seller is not selling to Purchaser or its
Designee, the following assets, properties and rights (the
"Excluded Assets"):
          
               (a) any books and records that Seller or a
     Selling Affiliate is required to retain pursuant to any
     statute, rule, regulation or ordinance, or which do not
     relate to any Purchased Assets, Assumed Liabilities,
     Transferred Employees or the NSC business;
               
               (b) any assets, property or rights not being
     transferred pursuant to Section 2.1 or which by law cannot
     be transferred; and
               
               (c) any assets of any Plans.
               
          
          2.3  Assumed Liabilities.  On the Closing Date,
Purchaser shall deliver to Seller an undertaking (the "Assumption
Agreement") in the form attached as Exhibit A.  Pursuant to the
Assumption Agreement, Purchaser or its Designee, on and as of the
Closing Date, shall assume and agree to perform, pay and
discharge when due:
          
               (a) the liabilities and obligations of Seller
     and the Selling Affiliates with respect to the Purchased
     Assets, but in each case only insofar as each such
     liability or obligation relates to the period from and
     after the close of business on the Closing Date (other than
     as a result of any breach by Seller or any Selling
     Affiliate of any of its obligations to Purchaser or its
     Designee); and
               
               (b) all obligations of Seller and its Affiliates
     to Transferred Employees for unused accrued vacation, sick
     leave and holiday pay (the "Vacation Pay Liabilities"); and
               
               (c) all liabilities and obligations of
     Purchaser, its Designee and its Affiliates to Transferred
     Employees arising after the Closing Date out of the
     employment of the Transferred Employees by Purchaser or its
     Designee after the Closing Date.

(all such assumed liabilities, collectively, the "Assumed
Liabilities").  Purchaser and its Designee are not assuming, and
shall not be deemed to have assumed, any liability or obligation
of Seller or any Affiliate of any kind or nature whatsoever,
except as expressly provided in the immediately preceding
sentence, in the Assumption Agreement or in any other agreement
to which the Purchaser or its Designee may be a party.

          2.4 Retained Liabilities.  Notwithstanding anything to
the contrary contained in this Agreement, and without limiting
the foregoing, the Assumed Liabilities shall not include, and the
Purchaser and its Designee are not assuming the following
Liabilities (the "Retained Liabilities"):
          
               (a) any Taxes of Seller or its Affiliates,
     whether or not accrued, assessed or currently due and
     payable, relating to operations or events occurring prior to
     the close of business on the Closing Date (other than as
     expressly provided in this Agreement);
               
               (b) any Liabilities relating to or arising out of
     any Excluded Assets;
               
               (c) all Liabilities of Seller or any Affiliate to
     or with respect to any present or former Employee, applicant
     for such employment, or a person claiming to be an Employee,
     other than a Transferred Employee, however arising, and all
     Liabilities of Seller or any Affiliate to or with respect to
     any Transferred Employee, however arising, other than the
     Vacation Pay Liabilities expressly assumed by Purchaser or
     its Designee pursuant hereto;
               
               (d) all liabilities and obligations for
     interdivisional, intracompany or intercompany payables,
     obligations or agreements;
               
               (e) all indebtedness of Seller and its Affiliates
     for borrowed money;
               
               (f) all Materials of Environmental Concern;
               
               (g) any Liabilities relating to or arising out of
     any Purchased Assets with respect to any claim, cause of
     action, proceeding or other litigation pending or threatened
     as of the close of business on the Closing Date or which is
     initiated at any time thereafter to the extent based on
     acts, facts, circumstances, events or conditions occurring
     or existing on or prior to the close of business on the
     Closing Date;
               
               (h) any other Liabilities relating to or arising
     out of any Purchased Assets, whether arising before, on, or
     after the Closing Date, other than the Assumed Liabilities;
     and
               
               (i) all Liabilities resulting from any breach or,
     default under, or misrepresentation contained in this
     Agreement or in any document delivered by or on behalf of
     Seller or any Selling Affiliate pursuant hereto.

          Pursuant to Section 7.2, Seller agrees to pay, perform
and discharge, and to indemnify Purchaser and its Affiliates
against and hold them harmless from, all obligations and
liabilities relating to the Purchased Assets and Transferred
Employees other than those which Purchaser or its Designee have
expressly agreed to assume pursuant to the second sentence of
Section 2.3.

          2.5 Instruments of Conveyance and Transfer; Further
Assurances.  (a)  On the Closing Date, Seller shall (i) deliver
or cause to be delivered to Purchaser or its Designee such fully
executed deeds endorsements, consents, assignments and other
good and sufficient instruments of conveyance and assignment,
all in recordable form, where applicable, as shall be effective
to vest in Purchaser or its Designee all right, title and
interest of Seller and the Selling Affiliates in and to the
Purchased Assets and (ii) transfer to Purchaser or its Designee
possession and control of all Purchased Assets.

               (b)  From time to time after the Closing Date,
Seller will execute, acknowledge and deliver, or cause to be
executed, acknowledged and delivered, such other instruments of
conveyance, assignment, transfer and delivery and will take or
cause to be taken such other actions as Purchaser may reasonably
request in order to more effectively exchange, convey, assign,
transfer, deliver to, and vest in the Purchaser or its Designee
any of the Purchased Assets and as otherwise may be appropriate
to carry out the transactions contemplated by this Agreement.
          
          2.6  Consideration for Transfer of the Purchased
Assets.  In consideration for the conveyance, assignment,
transfer and delivery to Purchaser or its Designee of the
Purchased Assets on the Closing Date as provided in Section 2.1
hereof, subject to the terms and conditions of this Agreement,
Purchaser agrees to pay Seller on the Closing Date a purchase
price in cash equal to the sum of:  (a) if the Closing Date is on
or before July 31, 1997, $1.9 million less the NSC Personal
Property Depreciation Adjustment plus the amount of the Prepaid
Expenses or (b) if the Closing Date is after July 31, 1997, $2
million less the NSC Personal Property Depreciation Adjustment
plus the amount of the Prepaid Expenses, plus the assumption of
the Assumed Liabilities (the "Purchase Price").  The cash portion
of the Purchase Price shall be paid in immediately available
funds by wire transfer to the account designated by Seller in
writing to Purchaser at the Closing.  "NSC Personal Property
Depreciation Adjustment" is the amount by which the assumed book
value of the NSC Personal Property as at May 31, 1997 exceeds the
assumed book value of the NSC Personal Property as at the earlier
of July 31, 1997 or the Closing Date; for purposes of the
preceding computations assumed book value shall be the
depreciated book value of the NSC Personal Property as at the
relevant date as determined in accordance with generally accepted
accounting principles consistently applied by Seller and the
Selling Affiliates as if NSC were a going concern and in
accordance with the methodology used in creating Schedule 2.1(c).
Seller shall furnish to Purchaser or its Designee within 5
Business Days of the Closing a detailed schedule showing the
computation of the cash portion of the Purchase Price and based
on such schedule Seller shall pay to Purchaser or its Designee or
Purchaser or its Designee shall pay to Seller any required
adjustments to the Purchase Price payment made at the Closing.
Seller shall give Purchaser's Representatives reasonable access
to the books and records of the Seller and its Selling Affiliates
so that Purchaser or its Designee may verify such computation.
Purchaser or its Designee shall notify Seller within 30 Business
Days after receipt of such schedule of any objections.  If no
objections are made within such period, the schedule shall be
deemed to be accepted by the Purchaser and its Designee.
          
          2.7  Closing and Deliveries.
          
               (a)  Closing.  Subject to the terms and conditions
     of this Agreement, the closing of the sale and purchase of
     the Purchased Assets (the "Closing") shall take place at the
     offices of Lehman Brothers Holdings Inc., 3 World Financial
     Center, New York, New York  10285 at 10:00 a.m. on the
     second Business Day after the condition to Closing specified
     in Section 6.1 shall have been satisfied, or such other time
     as Seller and Purchaser together agree in writing.  The
     actual time and date on which the Closing shall occur are
     herein referred to as the "Closing Date".  All calculations
     hereunder to be made as of the Closing Date shall be made as
     of such time and date that is immediately prior to the close
     of business on the Closing Date.  The Closing shall be
     effective as of 11:59 p.m. (EST) on the Closing Date.
               
               (b)  Seller's Deliveries.  Subject to the terms
     and conditions of this Agreement, at the Closing Seller
     shall deliver or cause to be delivered to Purchaser or its
     Designee:
               
                    (i)  a general assignment and bill of sale
     (the "Bill of Sale") in the form of Exhibit B conveying all
     the Purchased Assets not specified by (ii) or (iii) below;
                    
                    (ii) a warranty deed (or its local
     equivalent) in form and substance acceptable to the
     Purchaser to the Nebraska Real Property (the "Warranty
     Deed");
                    (iii)     the Assumption Agreement;
                    
                    (iv) the certificates referred to in Sections
     6.2(h) and (i);
                    
                    (v)  the Customer List (if any);
                    
                    (vi) such other instruments as may be
     necessary to convey the Purchased Assets to Purchaser;
                    
                    (vii)     originals or copies of all of the
     contracts, files and other documents required to be
     delivered to Purchaser or its Designee pursuant to Section
     2.1 hereof, which may be delivered in the form and order in
     which they are maintained by or on behalf of Seller or the
     Selling Affiliates;
                    
                    (viii)    a guaranty agreement substantially
     in the form of Exhibit F hereto (the "Guaranty") executed by
     Harbourton Holdings, L.P.; and
                    
                    (ix) the Transition Services Agreement.

               (c) Purchaser's Deliveries.  Subject to the terms
     and conditions of this Agreement, at the Closing Purchaser
     shall deliver or cause to be delivered to Seller
               
                    (i)  immediately available funds equal to the
     cash portion of the Purchase Price;
                    (ii) the Assumption Agreement;
                    
                    (iii)     the Bill of Sale;
                    
                    (iv) the certificate referred to in Sections
     6.3(d) and (e); and
                    
                    (v)  the Transition Services Agreement.
          
          2.8  Allocation of Consideration.
          
               (a)  Allocation.  The Purchase Price shall be
     allocated among the Purchased Assets as set forth on
     Schedule 2.8(a).
               
               (b)  Tax Consistency.  Purchaser and Seller shall,
     and shall cause their Affiliates to, report the transactions
     contemplated by this Agreement in a manner consistent with
     such allocation for the purposes of reporting Taxes,
     including but not limited to the preparation and filing of
     Form 8594 under Section 1060 of the Code (or any successor
     form or successor provision of any future tax law) with
     their respective federal income tax returns for the taxable
     year that includes the Closing Date, and neither Purchaser
     nor Seller will take, nor will they permit their Affiliates
     to take, any position inconsistent with such allocation
     unless otherwise required by applicable law.
          
          
                           ARTICLE III
            REPRESENTATIONS AND WARRANTIES OF SELLER

          Seller represents and warrants to Purchaser as follows:
          
          3.1  Organization and Good Standing.  Each of Seller
and the Selling Affiliates is an entity duly organized, validly
existing and in good standing under the laws of the jurisdiction
of organization and has the requisite corporate power and
authority to own, lease and operate the Purchased Assets.  Each
of Seller and the Selling Affiliates has all requisite
partnership or corporate power and authority to enter into this
Agreement and any other agreement contemplated hereby and to
perform its obligations hereunder and thereunder.  Each of Seller
and the Selling Affiliates is duly authorized, qualified or
licensed to do business as a foreign entity, and is in good
standing, in each of the jurisdictions in which its right, title
or interest in or to any of the Purchased Assets requires such
authorization, qualification or licensing, except where the
failure to so qualify or to be in good standing is not
individually or in the aggregate reasonably expected to have a
Section 3 Material Adverse Effect.
          
          3.2  Authority.  The execution, delivery and
performance by Seller and each Selling Affiliate of this
Agreement and any other agreements or documents executed or to be
executed by it in connection herewith, and the consummation of
the transactions contemplated hereby and thereby, have been duly
and validly authorized by all necessary partnership or corporate
action of Seller and the Selling Affiliates.  This Agreement has
been, and any other agreements or documents to be executed by it
in connection herewith will be, duly executed and delivered by
Seller and each Selling Affiliate and constitutes, or will
constitute, a legal, valid and binding obligation of Seller and
each Selling Affiliate, enforceable against it in accordance with
its terms, except as affected by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a
proceeding in equity or at law) and an implied covenant of good
faith and fair dealing.
          
          3.3  No Conflict or Breach.  The execution, delivery
and performance of this Agreement and any other agreements
contemplated hereby by Seller and each Selling Affiliate and the
consummation by it of the transactions contemplated hereby and
thereby do not and will not:
          
               (a)  conflict with or constitute a violation of
     organization documents of Seller or any Selling Affiliate;
               
               (b)  conflict with or constitute a violation of
     (with or without the giving of notice or the lapse of time
     or both) any provision of any law, judgment, order, decree,
     rule or regulation of any legislative body, court,
     governmental or regulatory authority or arbitrator which is
     applicable to or relates to Seller or any Selling Affiliate
     or any of the Purchased Assets, which individually or in the
     aggregate could reasonably be expected to have a Section 3
     Material Adverse Effect; or
               
               (c)  violate or conflict with, constitute a
     default under, result in a breach, acceleration or
     termination of any provision of, require notice to or the
     consent of any third party which has not been obtained
     under, or result in the creation of any Lien (as defined
     below) upon all or any portion of the Purchased Assets
     pursuant to, any contract, agreement, commitment, indenture,
     mortgage, deed of trust, lease, licensing agreement, note or
     other instrument or obligation to which Seller or any
     Selling Affiliate is a party or by which Seller, any Selling
     Affiliate or any of the Purchased Assets is bound.
          
          3.4  Consents.  Except as provided on Schedule 3.4, no
consent, approval or authorization of, or designation declaration
or filing with, or notice to, any legislative body court,
governmental or regulatory authority or arbitrator (other than
the Federal Trade Commission ("FTC") and the Department of
Justice ("DOJ")) under any provision of any law, judgment, order,
decree, rule or regulation is required on the part of Seller or
any Selling Affiliate in connection with the execution, delivery
and performance of this Agreement or any other agreement
contemplated hereby, the consummation of the transactions
contemplated hereby and thereby, or to ensure that the Purchased
Assets can be operated or used after the Closing as presently
operated or used.
          
          3.5  Licenses, Permits and Approvals.  Except as set
forth on Schedule 3.5 hereto, Seller and each Selling Affiliate
hold all material licenses, permits, franchises, releases,
certificates of compliance, consents, approvals and
authorizations of governmental authorities necessary for or used
in the ownership or operations of NSC and all such licenses,
permits, franchises, releases, certificates of compliance,
consents approvals and authorizations are, in full force and
effect.  Schedule 3.5 hereto contains a true and complete list or
description of all such licenses, permits, franchises, releases
certificates of compliance, consents, approvals and
authorizations (showing in each case, the expiration date).
Except as set forth on Schedule 3.5 hereto, no application,
petition, objection, opposition, action or proceeding is pending
or, to the best of Seller's knowledge, threatened that may result
in the denial of an application for renewal, the revocation,
modification, nonrenewal or suspension of any of such licenses,
permits, franchises, releases, certificates of compliance,
consents, approvals or authorizations, the issuance of a cease-
and-desist order, or the imposition of any administrative or
judicial sanction with respect to Seller, any Selling Affiliate
or any of the Purchased Assets that is reasonably expected to
have a Section 3 Material Adverse Effect
          
          3.6  Real Property.
          
               (a)  Compliance.  Except as set forth on Schedule
     3.6(a) hereto, the Nebraska Real Property is in compliance
     in all material respects with applicable laws, including
     zoning, land use and building code laws, ordinances and
     regulations necessary to conduct the operations of Seller
     and its Affiliates thereon as presently conducted, and the
     transactions contemplated by this Agreement could not
     reasonably be expected to result in the revocation of any
     permit or variance, except to the extent that any such non-
     compliance, violation or revocation, individually or in the
     aggregate, could not reasonably be expected to have a
     material adverse effect on such property.  Except as set
     forth on Schedule 3.6(a) hereto, all buildings, structures
     and improvements on the Nebraska Real Property are in good
     condition and repair, ordinary wear and tear excepted, and
     are fit for the purpose for which they are presently
     utilized and conform to generally accepted industry
     practice.
               
               (b)  Title to Real Property.  Except as
     specifically set forth on Commonwealth Land Title Insurance
     Company Commitment No. 4340A attached as Schedule 3.6(b)
     hereto, Seller and the Selling Affiliates have, and
     Purchaser or its Designee will receive on the Closing Date,
     good and insurable fee simple title to the Nebraska Real
     Property, free and clear of all claims, liens, mortgages,
     pledges, imperfections of title, easements, covenants,
     restrictions, options, rights of refusal, security
     interests, charges, leases, encumbrances, licenses or
     sublicenses and other restrictions of any kind and nature
     (collectively, "Liens").
          
          3.7  Tangible Personal Property.  Schedules 2.1(c),
(d), (e), (f), and (k) hereto contain a true and complete list of
all NSC Personal Property, all Colorado Personal Property,
Vehicles and tangible assets which are included as part of
Systems and Inventory on the date hereof. Seller has, and
Purchaser will receive on the Closing Date, good and marketable
title to all such assets, free and clear of all Liens, except as
specifically set forth on Schedule 3.7(a) hereto.  Except as set
forth on Schedule 3.7(b) hereto, all such tangible personal
property is in good operating condition and repair, ordinary wear
and tear excepted.
          
          3.8  Contracts.  Schedule 2.l(b) and (m) hereto contain
a true and complete list or description of all Assigned
Subservicing Contracts and Assigned Contracts.  Except as set
forth on Schedule 3.8(a) hereto, all the Contracts are in full
force and effect and are valid and enforceable in all material
respects in accordance with their respective terms.  Except as
specified in Schedule 3.8(a) hereto, none of Seller or its
Selling Affiliates is in breach or default in the performance of
any obligation thereunder and no event has occurred or has failed
to occur whereby, with or without the giving of notice or the
lapse of time or both, a default or breach will be deemed to have
occurred thereunder or any of the other parties thereto have been
or will be released therefrom or will be entitled to refuse to
perform thereunder.  To the knowledge of the Seller and the
Selling Affiliates, no other party to an Assigned Subservicing
Contract or Assigned Contract is in default thereunder in any
material respect.  The Seller and Selling Affiliates, as well as
each prior servicer of a mortgage loan subject to an Assigned
Subservicing Contract, has duly and faithfully complied with all
applicable laws and regulations with respect to subject to any
Assigned Subservicing Contract and with all of the terms of each
Assigned Subservicing Contract, including mortgage servicing
guidelines, applicable to such loans.  No other party to any such
Contract has made or asserted, or, to the best of the knowledge
of Seller has, any defense, setoff or counterclaim under any such
Contract, no such other party has exercised any option granted to
it to cancel or terminate its agreement, to shorten the term of
its agreement, or to renew or extend the term of its agreement
and none of Seller or any of its respective Affiliates has
received any notice to that effect.  True and complete copies of
all documents relating to the Contracts have been delivered or
made available to Purchaser or its representatives.  Except for
the consents of the counterparties to the Assigned Subservicing
Agreements referred to in Schedule 3.8(a), no consent or approval
of any third party which will not have been obtained on or prior
to the Closing Date is required for the assignment of the
Assigned Subservicing Agreements and the Assigned Contracts to
the Purchaser or its Designee and, subject to receipt of such
counterparty consents, the assignment of such Contracts to the
Purchaser or its Designee will not result in a breach of or
default under any provision of such Contract.
          
          3.9  Operation of NSC.  NSC has been and is being
operated in all material respects in accordance with federal and
state mortgage servicing laws and regulations and all records,
documents and logs that are required to be maintained pursuant to
such rules, regulations and policies have been properly
maintained, except those the absence of which in the aggregate
would be immaterial to the conduct of the operations of NSC.
          
          3.10 Sufficiency of Purchased Assets.  Except as set
forth on Schedule 3.10 hereto and subject to the Purchaser's
obtaining all necessary licenses, permits, consents and approvals
of governmental authorities, and employing at least 85
Transferred Employees, to the knowledge of the Seller, the
Purchased Assets and all other rights to be conveyed to Purchaser
hereunder will provide Purchaser at the Closing with sufficient
systems, rights, know-how and other assets to enable Purchaser or
its Designee to have the capability to conduct a mortgage
servicing business in a manner substantially similar to that
presently conducted by NSC.
          
          3.11Undisclosed Obligations.  Except as disclosed on
Schedule 3.11 hereto or on any other Schedule to this Agreement,
Seller does not have any liability or obligation of any kind with
respect to the Purchased Assets or Transferred Employees, whether
accrued, absolute, fixed or contingent, known or unknown, other
than liabilities and obligations not being assumed by Purchaser
or its Designee under this Agreement or the Assumption Agreement.

          3.12Absence of Certain Changes.  Since the end of the
last fiscal quarter prior to the Closing, NSC has been operated
in the usual and ordinary course consistent with past practice
and, except as set forth on Schedule 3.12 hereto, there has been
no transaction, event or condition that individually or in the
aggregate has had or is reasonably expected to have a Section 3
Material Adverse Effect.

          3.13Litigation; Compliance with Laws.  (a) There is no
claim, litigation, proceeding or governmental investigation
pending or, to the best of the knowledge of Seller, threatened,
or any order, injunction or decree outstanding, against Seller or
any Selling Affiliate, which if adversely determined could
individually or in the aggregate reasonably be expected to have a
Section 3 Material Adverse Effect, (b) except with respect to the
Herbst case listed on Schedule 3.13 hereto, Seller and each
Selling Affiliate is in material compliance with all laws,
statutes, rules, regulations, orders and licensing requirements
of federal, state, local and foreign agencies and authorities
applicable to the conduct of the operations of NSC and the
Purchased Assets as a whole (including those relating to
antitrust and trade regulation and civil rights), and (c) no
written or oral notice has been received by Seller or any Selling
Affiliate from any such agency or authority alleging any such
material non-compliance.  Clause (b) of this Section 3.13 does
not relate to compliance with environmental laws, as to which
Section 3.14 is applicable, or compliance with labor laws, as to
which Section 3.18 is applicable.

          3.14Environmental Matters.  (a)  Except as set forth
on Schedule 3.14(a) hereto, with respect to  the Nebraska
Location, Seller and its Affiliates are in material compliance
with all federal, state and local laws, regulations, rules,
orders, decrees, ordinances and common law relating to pollution,
the protection of human health or the environment, including laws
relating to emissions, discharges, releases or threatened
releases of Materials of Environmental Concern, or otherwise
relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Materials
of Environmental Concern ("Environmental Laws").  "Materials of
Environmental Concern" means chemicals, pollutants, contaminants,
wastes, radiation (including radio-frequency radiation), toxic
substances, petroleum and petroleum products and any other
substance regulated by or that could result in liability under
any Environmental Laws, including those substances listed
pursuant to 42 U.S.C. 9601(14) and (33), PCBs (as defined below)
and asbestos.

               (b)  Except as set forth on Schedule 3.14(b)
hereto, there are no past or present actions, activities,
circumstances, conditions, events or incidents, including the
release, emission, discharge or disposal of any Materials of
Environmental Concern, at any property or facility currently or
formerly owned, operated or leased by Seller that could form the
basis after the Closing of any claim against Purchaser or its
Designee arising out of actions, activities, circumstances,
conditions, events or incidents prior to the Closing.

               (c)  Except as set forth on Schedule 3.14(c)
hereto, (i) there are no underground storage tanks located at the
Nebraska Location, (ii) there is no asbestos contained in or
forming part of any building, building component, structure or
office space located at the Nebraska Location, (iii) no
polychlorinated biphenyls (PCBs) are used or stored at the
Nebraska Location, and (iv) none of the electrical equipment
located at the Nebraska Location contains any PCBs.  Except as
set forth on Schedule 3.14(c) hereto, there are no on-site or off-
site locations where Seller or any Affiliate has stored, disposed
or arranged for the disposal of Materials of Environmental
Concern which relate in any way to the Nebraska Location.

               (d)  Except as set forth on Schedule 3.14(d)
hereto, none of Seller or any of its Affiliates has received any
notice of violation, alleged violation, noncompliance, liability
or potential liability regarding environmental matters or
compliance with Environmental Laws which relate in any way to the
Colorado Location or the Nebraska Location.
               
               (e)  Materials of Environmental Concern have not
been transported or disposed of by Seller or any Affiliate
thereof from the Colorado Location or the Nebraska Location or
the business of NSC in a manner or to a location which could
reasonably be expected to give rise to liability of Purchaser or
any of its Affiliate under Environmental Laws.
               
               (f)  Seller holds, and is in compliance with, all
permits, licenses, registrations or other authorizations required
under Environmental Laws ("Necessary Permits") which relate to
the Colorado Location and the Nebraska Location.  Except as set
forth on Schedule 3.14(f) hereto, to Seller's knowledge no
modification, revocation, reissuance, alteration, transfer, or
amendment of the Necessary Permits, or any review by, or approval
of, any third party of the Necessary Permits is required in
connection with the execution or delivery by Seller of this
Agreement or the documents executed or to be executed in
connection herewith, or the consummation of the transactions
contemplated hereby or thereby, or the operation, use and
enjoyment of the Colorado Location and the Nebraska Location by
Purchaser or its Designee following such consummation.

          3.15Reports; Books and Records.  The books and records
of and relating to NSC that have been delivered by Seller or any
Selling Affiliate to Purchaser or its Designee in connection with
the transactions contemplated by this Agreement have been
maintained in accordance with good business practice and
accurately reflect and evidence the transactions of such business
in all material respects.

          3.16Insurance.  Schedule 3.16 sets forth the liability
and other insurance that has been maintained by the Seller and
its Affiliates with respect to the operations of NSC.  Such
insurance coverage is commensurate with the levels of coverage
reasonable and customary in the mortgage servicing industry.  In
order to protect Purchaser and its Designee against any loss or
liability for events or acts occurring on or prior to the Closing
Date, Seller will or will cause its Affiliates to maintain run-
off coverage on the errors and omissions policy through at least
December 31, 1998, on the blanket bond policy through at least
July 1, 1998 and on its directors and liability policy through at
least August 6, 1998 and to name Purchaser and its Designee as a
loss payee with a right to file claims endorsement on the errors
and omissions and blanket bond policies.  If Seller or any of its
Affiliates in their discretion maintain such coverage beyond the
dates specified in the preceding sentence, Purchaser and Designee
shall continue to be named as a loss payee with a right to file
claims endorsement.

          3.17Taxes.  All Tax Returns required to be filed by
law where the failure to file such Tax Returns on a duly and
timely basis could result in a Lien on the Purchased Assets or
the imposition on Purchaser or its Designee of any liability for
Taxes have been duly and timely filed in the proper form with the
appropriate governmental authority.  All Taxes of whatever nature
due or payable pursuant to said Tax Returns or otherwise have
been paid, except for such amounts as are being contested
diligently, in the appropriate forum and in good faith, where the
failure to pay or contest such amounts could result in a material
Lien on the Purchased Assets or the imposition on Purchaser or
its Designee of any liability for any Taxes.  There are no Tax
audits pending and no outstanding agreements or waivers extending
the statutory period of limitations applicable to any federal,
state or local income Tax Return for any period, the result of
which could result in a Lien on the Purchased Assets or the
imposition on Purchaser or its Designee of any liability for any
Taxes.  There are no governmental investigations or other legal,
administrative or Tax proceedings pursuant to which Seller or any
Affiliate is or could be made liable for any Taxes, penalties,
interest or other charges, the liability for which could extend
to Purchaser or its Designee as transferee of the Purchased
Assets, or which could result in a Lien on the Purchased Assets
and, to the best of Seller's knowledge, no event has occurred
that could impose on Purchaser or its Designee any liability for
any Taxes, penalties or interest due or to become due from Seller
or any Affiliate.  Any open Tax Return year of Seller or any
Affiliate that relates to the period prior to the closing of
business on the Closing Date that may be audited after the
Closing Date, or any assessments related to any such period,
shall be the sole responsibility of the Seller or such Affiliate.

          3.18Employee Benefits.  (a) Schedule 3.18(a) hereto
lists each "employee benefit plan" (within the meaning of section
3(3) of ERISA) and any other employee plan, agreement or
arrangement maintained or otherwise contributed to by Seller or
any of its Affiliates for the benefit of any Employees (the
"Plans").  Copies or descriptions of the Plans have been or will
be furnished or made available to Purchaser or its
representatives.

               (b)  Each Plan has been administered and is in
material compliance with the terms of such plan and all
applicable laws, rules and regulations, except as disclosed in
the copy of the voluntary compliance resolution request attached
as Schedule 3.18(b).  Additionally, except as so disclosed, none
of Seller, any Affiliate or any trustee, administrator or other
fiduciary of any Plan has engaged in any transaction or acted in
a manner that could, or has failed to act so as to, (i) result in
any material liability for breach of fiduciary duty under ERISA
or any other applicable law or (ii) result in fines, penalties,
taxes or related charges under (x) section 502(c), (i) or (1) of
ERISA, (y) section 4071 of ERISA or (z) Chapter 43 of the Code.
               
               (c)  No "reportable event" (as such term is used
in section 4043 of ERISA) with respect to which notice to the
Pension Benefit Guaranty Corporation has not been waived,
"prohibited transaction" (as such term is used in section 4975 of
the Code or section 406 of ERISA) or "accumulated funding
deficiency" (as such term is used in section 412 or 4971 of the
Code) has heretofore occurred with respect to any Plan and Seller
has not incurred any liability to the Pension Benefit Guaranty
Corporation with respect to any Plan subject to Title IV of ERISA
other than liability for premiums.  Neither the execution of this
Agreement nor the transactions contemplated hereby will
constitute a "reportable event."
               
               (d)  There are no pending or, to the best of the
knowledge of Seller, threatened, actions, claims or lawsuits
which have been asserted or instituted involving or arising out
of any Plan, with respect to the operation or administration of
such plan (other than routine benefit claims).
               
               (e)  Neither Seller nor any member of a
"Controlled Group" (as defined in section 414 of the Code) in
which Seller is a member (a "Commonly Controlled Entity" as
defined in the Code) has any liability in respect of any
"multiemployer plan" (as such term is defined in section 3(37) of
ERISA, a "Multiemployer Plan") and neither Seller nor any
Commonly Controlled Entity of Seller has incurred any withdrawal
liability which remains unsatisfied.  Additionally, Seller (i)
has not previously announced an intention to withdraw without
completing withdrawal, and (ii) has no present intention to
withdraw, in each case from a Multiemployer Plan with respect to
the Purchased Assets; and no action has been taken, and no
circumstances exist, that alone or with the passage of time could
result in either a partial or complete withdrawal from such
Multiemployer Plan by Seller or any Affiliate with respect to the
Purchased Assets.
               
               (f)  Except as set forth on Schedule 3.18(f)
hereto, no Plan exists which could result in the payment to any
Employee of any money or other property or rights or accelerate
or provide any other rights or benefits to any such employee as a
result of the transactions contemplated by this Agreement,
whether or not such payment would constitute a parachute payment
within the meaning of section 280G of the Code.

          3.19Certain Fees.  Except as disclosed on Schedule
3.19, neither Seller nor any of its Affiliates, nor any of its
officers, directors or employees, on behalf of Seller or such
Affiliates, has retained or dealt with any broker or finder or
incurred any other liability for any brokerage fees, commissions
or finders' fees in connection with the transactions
contemplated by this Agreement.

          3.20Intellectual Property Rights.  Seller and the
Selling Affiliates own or have valid licenses to all of the
Systems and the other intellectual property constituting part of
the Purchased Assets and at the Closing Purchaser or its
Designee will receive ownership or a valid license to all of
such Systems and intellectual property constituting part of the
Purchased Assets, free and clear of all Liens except as noted on
Schedule 3.20.  All intellectual property licenses being
transferred to the Purchaser or its Designee as part of the
Purchased Assets are valid for the number of employees and
locations using such licenses.


                           ARTICLE IV
           REPRESENTATIONS AND WARRANTIES OF PURCHASER

          Purchaser represents and warrants to Seller as follows:
          
          4.1  Organization and Good Standing.  Purchaser and
each Designee is a corporation duly organized, validly existing
and in good standing under the laws of the state of its
jurisdiction of incorporation and has the requisite corporate
power and authority to enter into this Agreement and any other
agreement contemplated hereby, and to perform its obligations
hereunder and thereunder.
          
          4.2  Authority.  The execution, delivery and
performance by it of this Agreement and any other agreements or
documents executed or to be executed by it in connection
herewith, and the consummation of the transactions contemplated
hereby and thereby, have been duly and validly authorized by all
necessary corporate and stockholder action of Purchaser and its
Designee.  This Agreement has been, and any other agreements or
documents to be executed by it or any Designee in connection
herewith will be, duly executed and delivered by it and
constitutes, or will constitute, a legal, valid and binding
obligation of Purchaser, enforceable against it in accordance
with its terms, except as affected by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a
proceeding in equity or at law) and an implied covenant of good
faith and fair dealing.
          
          4.3  No Conflict or Breach.  The execution, delivery
and performance of this Agreement and any other agreements
contemplated hereby by it and the consummation by it of the
transactions contemplated hereby and thereby do not and will not:
          
               (a)  conflict with or constitute a violation of
     the certificate of incorporation or bylaws of Purchaser or
     any Designee; or
               
               (b)  conflict with or constitute a violation of
     (with or without the giving of notice or the lapse of time
     or both) any provision of any law, judgment, order, decree,
     rule or regulation of any legislative body, court,
     governmental or regulatory authority or arbitrator which is
     applicable to or relates to Purchaser or its Designee, which
     individually or in the aggregate could reasonably be
     expected to have a Section 4 Material Adverse Effect.
          
          4.4  Consents.  Except as set forth on Schedule 4.4
hereto, no consent, approval or authorization of, or designation,
declaration or filing with, or notice to, any legislative body,
court, governmental or regulatory authority or arbitrator (other
than the FTC and the DOJ) under any provision of any law,
judgment, order, decree, rule or regulation is required on the
part of Purchaser or its Designee in connection with the
execution, delivery and performance of this Agreement or any
other agreement contemplated hereby, the consummation of the
transactions contemplated hereby and thereby, or to ensure that
the Purchased Assets can be operated or used after the Closing as
presently operated or used.
          
          4.5  Certain Fees.  Neither Purchaser nor its
Affiliates, nor any of their respective officers, directors or
employees, on behalf of Purchaser or such Affiliates, has
retained or dealt with any broker or finder or incurred any other
liability for any brokerage fees, commissions or finders' fees in
connection with the transactions contemplated by this Agreement.


                            ARTICLE V
                FURTHER AGREEMENTS OF THE PARTIES

          5.1 Pre-Closing Covenants.  From the date of this
Agreement through the Closing Date, the Seller shall directly or
indirectly through the Selling Affiliates:

               (a)  cause the business of NSC to be operated in
     the usual and ordinary course consistent with past practices
     and in material compliance with all applicable laws,
     ordinances, regulations, rules or orders;
               
               (b)  use reasonable best efforts, consistent with
     its past practices, (i) to preserve the business
     organization of NSC and to preserve the goodwill and
     business of NSC, (ii) to retain the services of the
     employees of NSC, and (iii) to preserve all trademarks,
     trade names, service marks, internet domain names and
     copyrights and related registrations of NSC;
               
               (c)  not sell, transfer, lease or otherwise
     dispose of any of the Purchased Assets, or agree to do any
     of the foregoing, other than in the ordinary course of its
     business consistent with past practice;
               
               (d)  not permit or allow any of the Purchased
     Assets to become subject to any Liens, other than those
     listed or described on Schedule 3.6(b) or 3.7(a) or those
     which are released on or prior to the Closing Date;
               
               (e)  except with the Purchaser's prior written
     approval, which approval with respect to clause (i) below
     shall not be unreasonably withheld, not (i) enter into or
     renew any lease, commitment or other agreement with respect
     to any of the Purchased Assets providing for payments by the
     Seller, any Selling Affiliate or the Purchaser or its
     Designee, except in the ordinary course of business and
     consistent with past practices, (ii) cause or take any
     action to allow any material lease, commitment or other
     agreement to lapse (other than in accordance with its
     terms), to be modified in any adverse respect, or otherwise
     to become impaired in any material manner, except in the
     ordinary course of business where such actions, individually
     or in the aggregate, are not reasonably expected to have a
     Section 3 Material Adverse Effect, (iii) make material
     changes in any method of marketing, management or operation,
     accounting methods, practices or procedures, collection or
     credit extension policies, or cash management methods,
     practices or procedures, (iv) grant or agree to grant any
     general increases in the rates of salaries or compensation
     payable to the Employees, other than in the ordinary course
     of business consistent with past practices, (v) grant or
     agree to grant any specific bonus or increase to any
     executive or Employee whose total annual compensation after
     the increase would be at an annual rate in excess of $50,000
     (including any such increase pursuant to any pension, profit
     sharing or other plan or commitment), other than bonuses or
     salary increases in the ordinary course of business
     consistent with past practices, or (vi) provide for any new
     profit sharing, pension, retirement or other employment
     benefits for Employees or any increase in any existing
     profit sharing or benefits, establish any new employee
     benefit plan or amend or modify any existing employee
     benefit plan, or otherwise incur any obligation or liability
     under any employee benefit plan materially different in
     nature or amount from obligations or liabilities incurred
     during similar periods in prior years;
               
               (f)  maintain in full force and effect property
     damage, liability and other insurance with respect to the
     Purchased Assets at levels of coverage consistent with
     Seller or the Sellings Affiliates' past practice with
     respect to similar assets;
               
               (g)  refrain from taking any action (or failing to
     take any action) if such action (or failure to take any
     action) could reasonably be expected to result in the
     expiration, revocation, suspension or adverse modification
     of any governmental licenses, permits or certificates
     material to the operation of NSC or the Purchased Assets as
     a whole, and prosecute with due diligence any applications
     to any governmental authority material to the operation of
     NSC or the Purchased Assets as a whole; and
               
               (h)  refrain, and shall cause each of its
     Affiliates to refrain, from agreeing, whether in writing or
     otherwise, to take any action inconsistent with any of the
     foregoing.
          
          5.2  No Control.  Between the date of this Agreement
and the Closing Date, the Purchaser shall not, directly or
indirectly control, supervise or direct, or attempt to control,
supervise or direct, the operations of NSC, but such operations
shall be solely the responsibility of the Seller and its Selling
Affiliates, and, subject to the provisions of Section 5.1, shall
be in its complete discretion.
          
          5.3  Expenses.  Each of the parties shall bear its own
expenses incurred in connection with the negotiation and
preparation of this Agreement and in connection with all
obligations required to be performed by it under this Agreement,
except where specific expenses have been otherwise allocated by
this Agreement.
          
          5.4  Access to Information.  Prior to the Closing, the
Purchaser and its directors, officers, employees, Affiliates, non-
employee representatives (including financial advisors, attorneys
and accountants) and agents (collectively, its "Representatives")
may make such investigation of NSC, the Purchased Assets and
Transferred Employees as it may reasonably desire, and the Seller
shall give to the Purchaser and to its Representatives, upon
reasonable notice, full access during normal business hours
throughout the period prior to the Closing to all of the
Purchased Assets, including all the assets, books, commitments,
agreements, records and files of NSC and the Transferred
Employees.  The Seller shall furnish to the Purchaser during that
period all documents and copies of documents and information
concerning the businesses and affairs of NSC, the Transferred
Employees and the Purchased Assets as the Purchaser reasonably
may request.  The Purchaser shall treat, and shall cause its
Representatives to treat, all such information and documents and
all other information and documents delivered pursuant to this
Agreement confidential and, if the purchase and sale contemplated
by this Agreement is not consummated for any reason, upon request
therefor, the Purchaser shall return to the Seller all such
documents and shall destroy any copies thereof as soon as
practicable.  The Purchaser's obligations under this Section 5.4
shall survive the termination of this Agreement.
          
          5.5  Consents; Assignment of Agreements.  The Seller
shall use its best efforts to obtain at the earliest practicable
date all consents and approvals referred to in Sections 3.3(c)
and 3.4; provided, that no contract or other agreement shall be
modified to increase the amount payable thereunder or to
otherwise modify the terms thereof in a manner adverse to the
Purchaser, in order to obtain any such consent or approval
without first obtaining the written consent of the Purchaser and;
provided, further, if any such consent is not obtained (and
Purchaser has waived the condition precedent to Closing that such
consent or approval has been obtained), Seller and its Selling
Affiliates shall, to the extent reasonably possible, keep the
agreement in effect and shall give Purchaser or its Designee the
benefit of the agreement to the same extent as if it had not been
excluded, and Purchaser or its Designee shall perform the
obligations under the agreement relating to the benefit obtained
by Purchaser or such Designee.  The Seller shall furnish the
Purchaser with a copy of all consents and approvals referred to
in Sections 3.3(c) and 3.4 obtained pursuant hereto.  Nothing in
this Agreement shall be construed as an attempt to assign any
agreement or other instrument that is by its terms nonassignable
without the consent of the other party.
          
          5.6  Transition Services Agreement.  At Closing, Seller
and Purchaser shall enter into the Transition Services Agreement
substantially in the form of Exhibit C.
          
          5.7  Further Assurances.  Prior to the Closing Date,
Seller shall assist Purchaser in Purchaser's efforts to hire such
employees of NSC whom Purchaser determines to hire pursuant to
Section 5.12.  At any time and from time to time after the
Closing, each of the parties shall, without further
consideration, execute and deliver to the other such additional
instruments and shall take such other action as the other may
request to carry out the transactions contemplated by this
Agreement.  The Seller and the Purchaser will notify the other
parties hereto immediately of any litigation, arbitration or
administrative proceeding pending, or to their knowledge,
threatened, against any party hereto which challenges the
transactions contemplated by this Agreement.  For a period of
three years after the Closing, Purchaser shall grant Seller, the
Selling Affiliates, and Harbourton Holdings, L.P. reasonable
access during normal business hours upon reasonable prior notice
to the books and records of Purchaser as they relate to the
Purchased Assets to the extent necessary to comply with any
applicable law or governmental rule or request relating to the
period during which Seller owned the Purchased Assets.
          
          5.8  Compliance with Bulk Transfer Law.  The Seller
expressly agrees to comply with the provisions of any bulk sales
act relating to bulk transfers in any jurisdiction wherein any of
the Purchased Assets are located, if applicable to this
transaction.  Seller shall indemnify and hold the Purchaser and
its Designee harmless from any obligations, losses, liabilities
and expenses (including reasonable attorneys' fees) asserted by
third parties or incurred by Purchaser or its Designee as a
result of Seller's noncompliance with any such act.
          
          5.9  Other Action.  None of the parties to this
Agreement shall take any action that would result in the
condition set forth in Section 6.2(a) or 6.3(a), as the case may
be, not being satisfied at and as of the time of the Closing.
Subject to the terms and conditions hereof, each of the parties
shall use its best efforts to cause the fulfillment at the
earliest practicable date of all of the conditions to the
obligations of the parties to consummate the transactions
contemplated by this Agreement.  Without limiting the generality
of the foregoing, the Seller shall execute and deliver to the
Purchaser (or the Purchaser's title insurer) such reasonable and
customary affidavits, certificates and documentation relating to
the Seller's ownership and title to the Nebraska Real Property,
as shall be reasonably required in connection with the
Purchaser's or its Designee's obtaining an owner's policy of
title insurance with respect to such property.
          
          5.10 Updated Schedules.  Prior to the Closing, Seller
shall update the Schedules hereto, in each case to reflect any
actions taken or omitted to be taken by the Seller in accordance
with the provisions of this Agreement during the period
commencing on the date of this Agreement and ending immediately
prior to the Closing.
          
          5.11 Certain Taxes and Expenses.  (a)  Sales Taxes;
Transfer and Recording Fees.  Purchaser shall pay (i) any state
or local sales and use Taxes payable in connection with the
transactions contemplated by this Agreement, (ii) any stamp or
transfer Taxes, real property Taxes or recording fees payable in
connection with the transactions contemplated by this Agreement
and (iii) any registration fees and expenses payable in
connection with the transactions contemplated by this Agreement;
provided such taxes, fees and expenses are customarily paid by a
purchaser.  The Seller shall comply, and shall cause the
Purchased Assets to be transferred by it to comply, with any
reasonable requirements for obtaining any available exemption
from any such Taxes or other fees.
          
          (b) Tax Apportionment.  In the case of any taxable
period that includes (but does not begin on) the Closing Date
(the "Tax Period"): the parties shall prorate (i) real estate and
other property taxes, including special assessments, and (ii)
rents, utilities, deposits and other like items customarily
prorated in connection with the sale of assets on the basis of
the number of days of the tax year, calendar year or service
period (as the case may be) which has elapsed as of 1 1:59 P.M.
on the Closing Date.  With respect to real estate taxes, Seller
shall pay such taxes and assessments for assessment period 1997
when they fall due (whether or not after the Closing) and
Purchaser shall pay to Seller Purchaser's pro rata share of such
amounts after Seller has paid such taxes and within thirty (30)
days of being presented with an invoice from Seller.  Nothing in
this Section 5.11(b) is intended to affect the provisions of
Sections 2.3 and 2.4 with respect to the respective obligations
of the parties in connection with the liabilities of Seller and
Purchaser or any other item not customarily pro rated in
connection with the sale of assets.

          (c) Except as described above, each of Seller and
Purchaser shall be responsible for the preparation and filing of
any Tax Returns which it is required by law to file and for the
payment of all Taxes due and payable with respect to such Tax
Returns or otherwise.

          5.12Employees.  (a) Transfer of Employees.  Promptly
after the date hereof, Seller shall provide to Purchaser a list
of all current Employees identified (as applicable) by name,
social security number, most recent hire date, seniority date,
base salary and hourly wage.  Effective as of the Closing,
Purchaser or its Designee shall offer employment to at least 85
Employees, of which at least 80 shall be Employees at the
Nebraska Location, designated by Purchaser on Schedule 5.12(a)
hereto (the "Designated Employees"), at a base salary or wage
level at least equal to that which they were receiving
immediately prior to Closing; notwithstanding the foregoing,
Purchaser or its Designee shall be required to offer employment
to the aforementioned minimum number of Employees only if the
Transition Services Agreement is entered into at the Closing.
Purchaser's offer of employment to the Designated Employees shall
be conditioned upon such employee's resignation from the Seller
and such employee's acceptance of the offer of employment no
later than five (5) Business Days after the Closing Date.  All
Employees who are Designated Employees and who accept an offer of
employment from Purchaser are herein referred to as the
"Transferred Employees."  Schedule 5.12(a) identifies
approximately 20 Transferred Employees as "Transition Services
Employees."  Seller agrees that in the event that Purchaser or
its Designee terminates the employment of any Transition Services
Employee within 12 months after the Closing Date, it will
promptly after written demand therefor, reimburse Purchaser for
the full amount of the severance payment paid to such terminated
Employee, provided that such reimbursement shall not be in excess
of the amount payable under Seller's current severance practice.

          (b) Severance Benefits.  Seller shall be responsible
and liable for all severance benefits and termination pay that
become due and payable whether by operation of common law,
statute, or otherwise to any Employees or individuals claiming to
be Employees as a result of the Transactions.

          (c) Purchaser's Benefit and Welfare Programs.  All of
Purchaser's employee benefit and welfare plans, programs and
arrangements in which Transferred Employees become eligible to
participate (other than any pension plan) shall credit such
Transferred Employees with a period of service beginning on their
most recent hire date with Seller or its Affiliates for purposes
of eligibility, but not for purposes of benefit computation or
accrual.

          (d) Health Insurance.  Effective as of Closing,
Purchaser shall establish a new group health insurance plan or
designate a pre-existing group health plan ("Purchaser's Health
Plan") that will provide coverage to all Transferred Employees
(and their dependents) without any probationary or waiting
period.  Purchaser's Health Plan shall not contain any exclusion
or limitation with respect to any preexisting condition of any
Transferred Employees or their dependents.  In addition, with
respect to any Transferred Employee (or the dependent of any
Transferred Employee) with an ongoing medical condition first
arising prior to Closing for which treatment will continue after
the Closing, Purchaser's Health Plan shall bear the expense of
covered treatment to the extent that the services rendered by the
provider occurred after the Closing Date, subject to the terms of
the Purchaser's Health Plan provisions relating to the coverage,
if any, of such treatment (but without any probationary or
waiting period).  Any amount paid by Transferred Employees or
their dependents for the current plan year for medical expenses
that are treated as a deductible or co-insurance payment under
the Seller's or its Affiliates' health insurance plan shall
reduce the amount of any deductible or co-insurance payment
required to be paid for a similar period under Purchaser's Health
Plan.  Notwithstanding the foregoing, Seller and the Selling
Affiliates shall provide to Employees all COBRA notices to the
extent required by applicable law.

          (e) Vacation, Holiday and Sick Pay.  Effective as of
Closing, Purchaser expressly assumes all of the Seller's or any
Affiliate's then existing accrued obligations for Vacation Pay
Liabilities owed to Transferred Employees.  Schedule 5.12(e)
hereto contains a list of the accrued Vacation Pay Liabilities
owed to each Employee as of June 30, 1997.  Such Schedule 5.12(e)
shall be updated at Closing, or as soon thereafter as is
reasonably practicable with respect to all Transferred Employees,
provided that, notwithstanding anything to the contrary in this
Agreement, Seller or a Selling Affiliate shall pay to each
Transferred Employee his or her accrued Vacation Pay Liabilities
in excess of ten working days as of the Closing.

          (f) Workers' Compensation.  Seller expressly retains
all of Seller's or any Affiliate's obligations for workers
compensation benefits payable after Closing to any Transferred
Employee with respect of events occurring on or before the
Closing Date

          (g) Disability.  Seller expressly retains all of
Seller's then existing obligations for benefits payable after
Closing to any Transferred Employee due to leave of absence,
disability or layoff occurring prior to the Closing.



          (h)  401 (k) Plan and Pension Plan.

               (i) Plan Participation.  Effective as of the
Closing Date, all Transferred Employees shall cease participation
in any 401(k) Plan of Seller or any Affiliate ("Seller's 401(k)
Plan").  As soon as practicable, following Closing, Purchaser
shall designate, or establish, a savings plan, qualified under
Code  401 (a) and 401 (k), and a trust thereunder that is
exempt from tax under Code 501(a) (collectively "Purchaser's
Savings Plan"), and shall allow all Transferred Employees to
participate in Purchaser's Savings Plan on the same terms and
conditions as apply to other similarly situated employees of
Purchaser, with service credit as described in paragraph 5.12(c)
above.

               (ii)401(k) Plan Vesting. Seller shall take any
action that may be necessary or appropriate to insure that all
Transferred Employees are 100% vested in their account balances
under the Seller's 401(k) Plan and shall cause the trustee of
that Plan to pay those account balances to the Transferred
Employees or their beneficiaries in accordance with the terms of
the Seller's 401(k) Plan.

               (iii)    Pension Plan.  None of the Employees
currently participate in any pension plan of Seller or any
Affiliate and none have any accrued but unpaid benefits under any
such plan.

          (i) Tax Information for Employees.  Purchaser and
Seller agree to follow the Standard Procedure specified in Rev.
Proc. 96-60 1996-53 I.R.B.1, whereby, among other things, each
will be responsible for the reporting duties with respect to its
own payment of wages and compensation to employees.  The parties
will provide each other with reasonable access to any information
needed to comply with the foregoing and provide copies upon
request.

          5.13Non-Compete.  (a) In order that the Purchaser and
its Affiliates may have and enjoy the full benefit of the
business of the Purchased Assets, the Seller agrees that, for a
period commencing on the Closing Date and ending on the third
anniversary of the Closing Date (the "Restriction Period"),
neither Seller nor any of its Selling Affiliates will, without
the express written approval of the Purchaser, directly or
indirectly, engage in any Restricted Business in the United
States.  "Restricted Business" means the servicing of mortgage
loans secured by first or second liens primarily on one- to four-
family residential properties.  Because of the unique talents and
knowledge of the Seller and the Selling Affiliates, Seller agrees
that in the event it or any Selling Affiliate breach the
covenants contained in this Section, Purchaser and its Designee
shall suffer damages for which the remedy at law is inadequate
and the Purchaser or its Designee shall be entitled to specific
performance hereof and shall be entitled to an injunction to be
issued by any court of competent jurisdiction restraining Seller
or any Affiliate from committing or continuing any breach of this
Section.  Resort to equitable relief by Purchaser or its Designee
shall not, however, be construed to be a waiver of any other
rights that it may have for damages under this Agreement or
otherwise.

          (b) From the date hereof through the third anniversary
of the Closing Date, neither Seller nor any Affiliate shall
solicit or seek to hire any Designated Employee so long as any
such person is in the employ of Purchaser or any Affiliate
thereof.

                           ARTICLE VI
                CONDITIONS PRECEDENT; TERMINATION

          6.1  Conditions Precedent to Obligations of Purchaser
and Seller.  The obligations of Purchaser, on the one hand, and
Seller, on the other hand, to consummate the transactions
contemplated by this Agreement are subject to the fulfillment, at
or prior to the Closing, of the following condition: there shall
not be in effect any preliminary or permanent injunction or other
order issued by any federal or state court of competent
jurisdiction in the United States or by any United States federal
or state governmental or regulatory body nor any statute, rule,
regulation or executive order promulgated or enacted by any
United States federal or state governmental authority which
restrains, enjoins or otherwise prohibits the consummation of the
transactions contemplated by this Agreement or any other
agreements contemplated hereby; and

          6.2 Conditions Precedent to the Obligations of
Purchaser.  The obligations of Purchaser to consummate the
transactions contemplated by this Agreement are subject to the
fulfillment at or prior to the Closing, of each of the following
conditions (any of which may be waived in writing by Purchaser)

          (a) all representations and warranties of Seller under
     this Agreement (including the Schedules hereto as updated
     pursuant to Section 5.10) shall be true and correct in all
     material respects (provided, however, that, notwithstanding
     the foregoing, any such representation and warranty that is
     qualified as to materiality shall be true and correct in all
     respects) at and as of the time of the Closing with the same
     effect as though those representations and warranties had
     been made again at and as of that time (except as to any
     representation or warranty at or as of a specific date in
     which case such representation or warranty shall be deemed
     to have been made again at the time of the Closing but only
     with respect to such specific date);

          (b) Seller shall have performed and complied in all
     material respects with each obligation, covenant and
     condition required by this Agreement to be performed or
     complied with by it prior to or at the Closing;

          (c) Purchaser shall have been furnished with the
     instruments of conveyance and transfer referred to in
     Section 2.5, in form and substance reasonably satisfactory
     to Purchaser;

          (d) Purchaser or its Designee shall have all mortgage
     servicing and related licenses which are necessary to enable
     it to acquire the Purchased Assets and operate a mortgage
     servicing business in a manner substantially similar to that
     of NSC (including with the benefit of the Transition
     Services Agreement);

          (e) Purchaser or its Designee shall have entered into
     employment agreements with each of Messrs. Rick W. Skogg and
     Leo C. Trautman, Jr. on terms and subject to conditions that
     Purchaser, in its sole discretion shall deem reasonable;

          (f) Purchaser or its Designee shall have received a
     minimum number of acceptances of its offers of employment to
     Designated Employees such that Purchaser would have a
     minimal assembled workforce as of the Closing Date capable
     of conducting a mortgage servicing business in a manner
     consistent with the past practices of NSC;

          (g) Purchaser shall have received from counsel to
     Seller an opinion, dated the Closing Date, substantially in
     the form attached as Exhibit D;

          (h) Purchaser shall have been furnished with a
     certificate of an officer of Seller, dated the Closing Date,
     in form and substance reasonably satisfactory to Purchaser,
     certifying to the fulfillment of the conditions set forth in
     Sections 6.2(a) and (b);

          (i) Purchaser shall have been furnished with a
     certificate of a Secretary or Assistant Secretary of the
     general partner of Seller dated the Closing Date in form and
     substance reasonably satisfactory to Purchaser, certifying
     as to the attached copy of the resolutions of the general
     partner of Seller and each Selling Affiliate authorizing the
     execution, delivery and performance of, and the transactions
     contemplated by, this Agreement and any other agreements
     contemplated hereby, and stating that the resolutions
     thereby certified have not been amended, modified, revoked
     or rescinded;

          (j) Purchaser or its Designee shall have entered into
     a modification to the contract with CPI/Alltel contract
     reasonably satisfactory to Purchaser;

          (k) Purchaser or its Designee shall have entered into
     a lease for office space in Aurora, Colorado; and
          
          (1) Harbourton Holdings L.P. shall have executed the
     Guaranty.
          
          6.3 Conditions Precedent to the Obligations of Seller.
The obligations of Seller to consummate the transactions
contemplated by this Agreement are subject to the fulfillment, at
or prior to the Closing, of each of the following conditions (any
of which may be waived in writing by Seller):

          (a) all representations and warranties of Purchaser
     under this Agreement shall be true and correct in all
     material respects (provided, however, that, notwithstanding
     the foregoing, any such representation and warranty that is
     qualified as to materiality shall be true and correct in all
     respects) at and as of the time of the Closing with the same
     effect as though those representations and warranties had
     been made again at and as of that time (except as to any
     representation or warranty at or as of a specific date in
     which case such representation or warranty shall be deemed
     to have been made again at the time of the Closing but only
     respect to such specific date);

          (b) Purchaser shall have performed and complied, in
     all material respects, with each obligation, covenant and
     condition required by this Agreement to be performed or
     complied with by it prior to or at the Closing;
          
          (c)  Seller shall have received from counsel to
     Purchaser an opinion, dated the Closing Date, substantially
     in the form attached as Exhibit E;
          
          (d)  Seller shall have been furnished with a
     certificate of an officer of Purchaser, dated the Closing
     Date, in form and substance reasonably satisfactory to
     Seller, certifying to the fulfillment of the conditions set
     forth in Sections 6.3(a) and (b);

          (e) Seller shall have been furnished with a
     certificate of a Secretary or Assistant Secretary (or other
     appropriate officer) of Purchaser and its Designee (if any),
     dated the Closing Date, in form and substance reasonably
     satisfactory to Seller certifying as to the attached copy of
     the resolutions of the Board of Directors (or a duly
     authorized committee thereof) of Purchaser and its Designee,
     respectively, authorizing the execution, delivery and
     performance of, and the transactions contemplated by, this
     Agreement and any other agreements contemplated hereby, and
     stating that the resolutions thereby certified have not been
     amended, modified, revoked or rescinded; and
          
          (f) Purchaser or its Designee shall have entered into
     an office lease for Suite 600, 2530 So. Parker Road, Aurora,
     Colorado.

                          ARTICLE VII.
   SURVIVAL OF REPRESENTATIONS AND WARRANTIES: INDEMNIFICATION
                                
          7.1 Survival.  All representatives, warranties,
covenants and agreements, certificates or other instruments
delivered pursuant to this Agreement, shall survive the Closing
and shall remain in full force and effect; provided, that the
Seller shall only be liable to the Purchaser and its Affiliates
pursuant to Section 7.2(ii) below to the extent that written
notice of the claim is delivered within the periods set forth in
Section 7.4(a)(1) below.

          7.2 Indemnification by Seller  The Seller agrees to
indemnify and hold the Purchaser and its Affiliates, and their
respective officers, directors, employees and representatives,
harmless against and in respect of all Losses incurred or
suffered by the Purchaser and its Affiliates, and their
respective officers, directors, employees and representatives, in
connection with, arising out of, or as a result of each and all
of the following: (i) all obligations and Liabilities of the
Seller or its Affiliates or related to the Purchased Assets,
whether accrued, absolute, fixed, contingent or otherwise, other
than the Assumed Liabilities, as described in Section 2.3; (ii)
subject to Section 7.4(a), any breach by any of the Seller or its
Affiliates of their respective representations and warranties
contained herein or in the certificate delivered by the Seller
pursuant to Section 6.2(i) (which, for this purpose, shall be
determined without giving effect to any "materiality" or
"material adverse effect" limitation set forth therein); (iii)
any nonperformance or breach by the Seller or its Affiliates of
any covenant or other obligation (other than a representation or
warranty made by the Seller in Article III) to be performed by
the Seller or its Affiliates under this Agreement, and (iv)
sales, use, income and other Taxes arising at any time out of the
operations of NSC or any of the Purchased Assets as a whole prior
to the Closing Date (excluding any Taxes allocated to the
Purchaser under Section 5.11).  Notwithstanding anything to the
contrary contained herein or in the Assumption Agreement, the
indemnification obligations of the Seller in favor of the
Purchaser set forth in clauses (i), (iii) and (iv) above shall be
absolute and unconditional, and shall be enforceable without
regard to the existence or accuracy of any representations or
warranties given by the Seller or the Purchaser.

          7.3 Indemnification by Purchaser.  The Purchaser
agrees to indemnify and hold the Seller and its Affiliates
harmless against and in respect of all Losses incurred or
suffered by the Seller and its Affiliates in connection with,
arising out of, or as a result of each and all of the following:
(i) the Assumed Liabilities; (ii) subject to Section 7 4(a), any
breach by any of the Purchaser or its Affiliates of its
representations and warranties contained herein or in any
certificates delivered pursuant to Section 6.3(d) (which, for
this purpose, shall be determined without giving effect to any
"materiality" or "material adverse effect" limitation set forth
therein); and (iii) any nonperformance or breach by the Purchaser
or its Affiliates of any covenant or other obligation (other than
a representation or warranty made by the Purchaser in Article IV)
to be performed by the Purchaser or its Affiliates under this
Agreement.  Notwithstanding anything to the contrary contained
herein or in the Assumption Agreement, the indemnification
obligation of the Purchaser in favor of the Seller set forth in
clauses (i) and (iii) above shall be absolute and unconditional,
and shall be enforceable without regard to the existence or
accuracy of any representations or warranties given by the Seller
or the Purchaser.

          7.4 General Indemnification Provisions.  (a)
Notwithstanding the provisions of Sections 7.2 and 7.3, the
indemnified party shall not be entitled to indemnification for
Losses solely with respect to claims pursuant to Section 7.2(ii)
or 7.3(ii), as the case may be:

     (i)  unless the indemnified party shall have given written
          notice to the indemnifying party, setting forth its
          claim for indemnification in reasonable detail: (x) on
          or before the date which is two years after the
          Closing Date for Losses arising out of the matters
          referred to in Article III (other than Section 3.14 or
          3.17); (y) on or before the date which is three years
          after the Closing Date for Losses arising out of the
          matters referred to in Section 3.14, or (z) with
          respect to Losses arising out of the matters referred
          to in Section 3.17, on or before the date which is 60
          days following expiration of the applicable statute of
          limitations with respect to the Taxes as to which any
          such claim relates;
     
     (ii) unless the aggregate Loss arising out of any single
          breach or series of related breaches shall be at least
          equal to $1,000, provided that if the aggregate sum of
          each Loss which arises out of a single breach or
          series of related breaches that individually is less
          than $1,000 shall be at least equal to $5,000, then,
          subject to satisfaction of the basket in clause (iii)
          below, the indemnified party shall be entitled to
          indemnification under such Section 7.2(ii) or 7.3(ii)
          for all such Losses in excess of $5,000; and
     
     (iii)unless and until the aggregate amount of all Losses
          arising therefrom exceeds $25,000, whereupon the
          indemnified party shall be entitled to indemnification
          under such Section 7.2(ii) or 7.3(ii) only for the
          aggregate amount of such Losses in excess of $25,000;
          provided that for purposes of determining the
          aggregate amount of all Losses for this clause (iii),
          only such Losses referred to in the proviso to clause
          (ii) above that are in excess of $5,000 shall count
          toward the $25,000 minimum set forth in this clause
          (iii).
     
          (b) Promptly after (i) receipt by an indemnified party
under this Article VII of notice of any claim or the commencement
of any action or (ii) the intervention as of right by an
indemnified party under this Article VII into any action the
indemnified party shall if a claim in respect thereof is to be
made against the indemnifying party under this Article VII,
notify the indemnifying party in writing of the claim or the
commencement of or intervention as of right into that action,
provided that the failure to notify the indemnifying party shall
not relieve it from any liability which it may have to the
indemnified party under this Article VII, except if such
notification with respect to any claim to be made pursuant to
Section 7.2(ii) or 7.3(ii) is given after the applicable time
period specified in Section 7.4(a)(i) has lapsed.  If any such
claim shall be brought against an indemnified party or if an
indemnified party shall intervene as of right in any such action,
and such indemnified party shall notify the indemnifying party
thereof, and if the indemnifying party shall agree in writing to
indemnify promptly the indemnified party for the full amount of
any Loss sustained, suffered or incurred by the indemnified party
by reason of such claim or action, then the indemnifying party
shall be entitled to participate therein, and to assume the
defense thereof with counsel satisfactory to the indemnified
party, and to settle and compromise any such claim or action,
provided, however, that if the indemnified party has elected to
be represented by separate counsel pursuant to the proviso to the
second following sentence, such settlement or compromise shall be
effected only with the consent of the indemnified party, which
consent shall not be unreasonably withheld.  If the indemnifying
party does not agree to indemnify promptly the full amount of any
such Loss as provided in the immediately preceding sentence, then
the indemnifying party shall nevertheless have the right to
participate in the defense of any such claim or action, but such
defense and any settlement or compromise thereof shall at all
times be under the sole direction and control of the indemnified
party.  After notice from the indemnifying party to the
indemnified party of its election to assume the defense of such
claim or action, the indemnifying party shall not be liable to
the indemnified party under this Article VII for any legal or
other expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable costs
of investigation; provided, however, that the indemnified party
shall have the right to employ counsel to represent it if, in the
indemnified party's reasonable judgment, it is advisable for the
indemnified party to be represented by separate counsel, and in
that event the fees and expenses of such separate counsel shall
be paid by the indemnified party.  The Seller and the Purchaser
each agree to render to each other such assistance as may
reasonably be requested in order to ensure the proper and
adequate defense of any such claim or proceeding.

          (c) The amount of any Loss for which indemnification
is provided under any of Sections 7.2 or 7.3 shall be net of any
amounts recovered or recoverable by the indemnified party under
insurance policies with respect to such Loss (collectively, a
"Net Loss") and shall be (i) increased to take account of any net
Tax cost incurred by the indemnified party arising from the
receipt of indemnity payments hereunder (grossed up for such
increase) and (ii) reduced to take account of any net Tax benefit
realized by the indemnified party arising from the incurrence or
payment of any such Net Loss.  In computing the amount of any
such Tax cost or Tax benefit, the indemnified party shall be
deemed to recognize all other items of income, gain, loss,
deduction or credit before recognizing any item arising from the
receipt of any indemnity payment hereunder or the incurrence or
payment of any indemnified Net Loss.  Any indemnification payment
hereunder shall initially be made without regard to this Section
and shall be increased or reduced to reflect any such net Tax
cost (including gross-up) or net Tax benefit only after the
indemnified party has actually realized such cost or benefit.
For purposes of this Agreement, an indemnified party shall be
deemed to have "actually realized" a net Tax cost or a net Tax
benefit to the extent that, and at such time as, the amount of
Taxes payable by such indemnified party is increased above or
reduced below, as the case may be, the amount of Taxes that such
indemnified party would be required to pay but for the receipt of
the indemnity payment or the incurrence or payment of such Net
Loss, as the case may be.  The amount of any increase or
reduction hereunder shall be adjusted to reflect any final
determination (which shall include the execution of Form 870-AD
or successor form) with respect to the indemnified party's
liability for Taxes and payments between the parties to this
Agreement to reflect such adjustment shall be made if necessary.
Any indemnity payment under this Agreement shall be treated as an
adjustment to the value of the asset upon which its underlying
claim was based, unless a final determination (which shall
include the execution of a Form 870-AD or successor form) with
respect to the indemnified party or any of its Affiliates causes
any such payment not to be treated as an adjustment to the value
or the asset for United States federal income tax purposes.

          (d) Anything to the contrary contained herein
notwithstanding, in no event shall Seller or its Affiliates be
liable for any Loss (including without limitation any and all
liabilities of Seller and its Affiliates for costs, expenses and
attorneys' fees paid or incurred in connection therewith or in
connection with the curing of any and all misrepresentations or
breaches of warranties or covenants under this Agreement) to the
extent the aggregate of all indemnification payments by or on
behalf of Seller with respect to all Losses shall have exceeded
the Purchase Price.

          (e) The provisions of this Article VII shall
constitute the sole and exclusive remedy of Purchaser and its
Affiliates against Seller and the Selling Affiliates for all
Losses subject to the provisions of Section 7.2 (ii) and any
other rights or remedies with respect to the same, whether now
existing or hereafter arising, which Purchaser and its Affiliates
have or may have, are hereby waived to the maximum extent
permitted by applicable law.
          
                          ARTICLE VIII.
                           TERMINATION
                                
          8.1 Termination.  Except with respect to provisions
that expressly survive termination, this Agreement may be
terminated:

          (a)  by written agreement of all of the parties hereto;
     
          (b)  by Purchaser, by written notice to Seller,
     delivered not less than 30 days after receipt by Seller of
     an earlier written notice from Purchaser that there have
     been breaches or defaults of Seller's covenants and
     agreements hereunder which individually or in the aggregate
     could reasonably be expected to result in a Section 3
     Material Adverse Effect, provided such breaches and defaults
     have not been cured to the reasonable satisfaction of
     Purchaser since such earlier notice;
          
          (c)  by Seller by written notice to Purchaser,
     delivered not less than 30 days after receipt by Purchaser
     of an earlier written notice from Seller that there have
     been breaches or defaults of Purchaser's covenants and
     agreements hereunder which individually or in the aggregate
     could reasonably be expected to result in a Section 4
     Material Adverse Effect, provided such breaches and
     defaults have not been cured to the reasonable satisfaction
     of Seller since such earlier notice; or
          
          (d)  by Seller or Purchaser, if the Closing has not
     taken place by August 31, 1997,

provided, however, that the party seeking termination pursuant
to clauses (b) through (d) above (A) is not in breach in any
material respect of any of its representations, warranties,
covenants or agreements contained in this Agreement and (B) has
not caused such condition to have become incapable of
fulfillment through its own actions (or failures to act) that
directly result in a breach of a representation, warranty or
covenant by the other party contained herein.

          8.2 Liability.  The termination of this Agreement
under Section 8.1 shall not relieve any party of any Liability
for breach of this Agreement prior to the date of termination.

                           ARTICLE IX
                          MISCELLANEOUS

          9.1 Notices.  Any notice or other communication under
this Agreement shall be in writing (including by telecopy or
like transmission) and shall be considered given when delivered
personally, when delivered by a nationally recognized overnight
courier service, when mailed by registered mail (return receipt
requested) or when telecopied (with confirmation of transmission
having been received) to the parties at the addresses set forth
below (or at such other address as a party may specify by notice
to the other)

         If to Seller, to it at:
         
               Harbourton Financial Services L.P.
               2530 South Parker Road
               Aurora, Colorado 80014
               Attention:  Chief Executive Officer
               Fax: (303) 338-2289
               
          with copies to:

               Lowenstein, Sandler, Kohl, Fisher & Boylan, P.C.
               65 Livingston Avenue
               Roseland, New Jersey 07068
               Attention: Allen B. Levithan, Esq.
               Fax: (973) 992-5820
               
          If to Purchaser, to it at:
          
               Lehman Brothers Holdings Inc.
               Three World Financial Center
               New York, NY 10285
               Attention: Karen C. Manson, Esq.
                         Secretary and Vice President
               Fax: (212) 526-3774
          
          9.2 Entire Agreement:  No Third Party Beneficiaries.
This Agreement, including the Schedules hereto and the Exhibits
hereto, (a) constitutes the entire agreement between the parties
with respect to its subject matter and supersedes any previous
agreement among them relating to the subject matter hereof and
(b) is not intended to confer upon any person, including any
employee, other than the parties hereto and their respective
successors and assigns, any rights or remedies hereunder.

          9.3 Headings; Interpretation.  (a) The table of
contents and section headings of this Agreement are for reference
purposes only and are to be given no effect in the construction
or interpretation of this Agreement.

          (b) When a reference is made in this Agreement to an
Article, Section, Schedule or Exhibit, such reference shall be to
an Article, Section, Schedule or Exhibit of this Agreement unless
otherwise indicated.  Whenever the words "included", "includes"
or "including" are used in this Agreement, they shall be deemed
to be followed by the words "without limitation".  All accounting
terms not defined in this Agreement shall have the meanings
determined by generally accepted accounting principles as in
effect from time to time.  The words "hereof', "herein" and
"hereunder" and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement.  The definitions
contained in this Agreement are applicable to the singular as
well as the plural forms of such terms and to the masculine as
well as to the feminine and neuter genders of such term, and
references to a person are also to its permitted successors and
assigns.  Any agreement, instrument or statute defined or
referred to herein or in any agreement or instrument that is
referred to herein means such agreement, instrument or statute as
from time to time amended, modified or supplemented, including
(in the case of agreements or instruments) by waiver or consent
and (in the case of statutes) by succession of comparable
successor statutes and references to all attachments thereto and
instruments incorporated therein.

          9.4  Governing Law.  This Agreement shall be
governed by, and construed in accordance with, the law of the
State of New York applicable to agreements made and to be
performed in New York regardless of the laws that might
otherwise govern under applicable principles of conflicts of
law.

          9.5  Amendment; Waiver.  This Agreement may be
amended, supplemented or otherwise modified only by a written
instrument executed by the parties hereto.  No waiver by a of
any of the provisions hereof shall be effective unless
explicitly set forth in writing and executed by the party so
waiving.  Except as provided in the preceding sentence, no
action taken pursuant to this Agreement, including any
investigation by or on behalf of any party, shall be led to
constitute a waiver by the party taking such action of
compliance with any representations, warranties, covenants or
agreements contained herein or in any documents delivered or
to be delivered pursuant to this Agreement or in connection
with the Closing hereunder.  The waiver by any party hereto
of a breach of any provision of this Agreement shall operate
or be construed as a waiver of any subsequent breach.
          
          9.6  Separability.  If any provision of this
Agreement is invalid or unenforceable, the balance of this
Agreement shall remain in full force and effect.
          
          9.7  Assignment.  Neither party to this Agreement
may assign any of its rights or delegate any of its duties
under this Agreement without the prior written consent of the
other party to this Agreement.  Any purported assignment in
violation of this Section shall be void.  Subject to the two
immediately preceding sentences of this Section 9.7, this
Agreement will be binding upon, inure to the benefit of and
be enforceable by the parties hereto and their respective
successors and assigns.
          
          9.8  Publicity.  So long as this Agreement is in
effect, neither party nor any of their affiliates shall issue
or cause the publication of any press release or other public
announcement with respect to the transactions contemplated by
this Agreement without the consent of the other party, which
consent shall not be unreasonably withheld; provided,
however, that no such consent shall be required in connection
with any public disclosure which based on advice of counsel
is required by law, but the party required to make such
disclosure shall give the other party reasonable opportunity
to review and comment on any such disclosure prior to the
time such disclosure is made.
          
          9.9 Jurisdiction.  The courts of the State of New York
in New York County and the United States District Court for the
Southern District of New York shall have exclusive jurisdiction
over the parties with respect to any dispute or controversy
between them arising under or in connection with this Agreement
and, by execution and delivery of this Agreement, each of the
parties to this Agreement submits to the jurisdiction of those
courts, including the in personam and subject matter jurisdiction
of those courts, waives any objection to such jurisdiction on the
grounds of venue or forum non conveniens, the absence of in
personam or subject matter jurisdiction and any similar grounds,
consents to service of process by mail (in accordance with
Section 9.1) or any other manner permitted by law.  These
consents to jurisdiction shall not be deemed to confer rights on
any person other than the parties to this Agreement.

          9.10Specific Performance.  Each of the parties to this
Agreement acknowledge that all the Purchased Assets are of a
special, unique and extraordinary character, and that any breach
of this Agreement by any party hereto could not be compensated
for by damages.  Accordingly, if any of the parties breaches its
obligations under this Agreement, the other parties hereto shall
be entitled, in addition to any other remedies that they may
have, to enforcement of this Agreement by a decree of specific
performance requiring that the breaching party fulfill its
obligations under this Agreement.

          9.11Counterparts.  This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be
an original and all of which together shall constitute one and
the same instrument.

          IN WITNESS WHEREOF, each of the parties hereto has
caused this Agreement to be signed by its duly authorized
officer as of the date first above written.

                              HARBOURTON FINANCIAL SERVICES
L.P.
                              By Harbourton Mortgage
Corporation,
                                    its general partner




By:_____________________________________
                                    Name:
                                    Title:

                              LEHMAN BROTHERS HOLDINGS INC.




By:_____________________________________
                                   Name:
                                    Title:
                        LIST OF SCHEDULES

2.1(a)Nebraska Real Property
2.1(b)Assigned Subservicing Contracts
2.1(c)NSC Personal Property
2.1(d)Colorado Personal Property
2.1(e)Inventory
2.1(f)Systems
2.1(k)Vehicles
2.1(l)Prepaid Expenses
2.1(m)Assigned Contracts
2.8(a)Purchase Price Allocation
3.4   Consents
3.5   Licenses, Permits and Approvals
3.6(a)Compliance
3.6(b)Title To Real Property
3.7(a)Tangible Personal Property-Liens
3.7(b)Tangible Personal Property - Not Good Working Condition
3.8(a)Subservicing Contracts
      Valid and Enforceable Contracts
3.10  Sufficiency of Assets
3.11  Undisclosed Liabilities
3.12  Absence of Certain Changes
3.13  Litigation
3.14(a)   Environmental/Compliance
3.14(b)   Environmental/Materials of Concern
3.14(c)   Environmental/Storage Tanks, Asbestos, PCB's
3.14(d)   Environmental/Notice of Violation
3.14(f)   Necessary Permits
3.16  Insurance
3.18(a)   Employee Benefit Plan
3.18(b)   Plan Compliance Exception
3.18(f)   Payments
3.19  Certain Fees
3.20  Intellectual Property Rights
4.4   Licenses and Approvals
5.12(a)   Designated Employees/Transition Services Employees
5.12(e)   Accrued Vacation and Sick Pay/Holiday


                                
                        LIST OF EXHIBITS
                                
                                

A      Assumption Agreement

B      Bill of Sale

C      Transition Services Agreement

D      Opinion of Seller's Counsel

E      Opinion of Purchaser's Counsel

F      Guaranty
          THIS  MORTGAGE  SERVICING PURCHASE AND SALE  AGREEMENT,
dated  as  of  July 31, 1997 (this "Agreement"), is made  by  and
between   HARBOURTON  MORTGAGE  CO.,  L.P.,  a  Delaware  limited
partnership ("Seller"), and LEHMAN CAPITAL, A DIVISION OF  LEHMAN
BROTHERS HOLDINGS INC., a Delaware corporation ("Purchaser").

                           BACKGROUND:
                                
          Seller  owns  the Servicing Rights (as herein  defined)
with  respect  to the Mortgage Loans listed on the Mortgage  Loan
Schedule  (as  herein  defined) and Seller  desires  to  sell  to
Purchaser,  and  Purchaser desires to purchase from  Seller,  all
right,  title  and  interest in and to the  Servicing  Rights  in
accordance with the terms and subject to the conditions  of  this
Agreement.

          NOW THEREFORE, the Parties agree as follows:

                            ARTICLE I
                 DEFINITIONS AND INTERPRETATIONS
                                
          Section 1.1    Definitions.

          For  the  purpose of this Agreement, capitalized  terms
have the meanings set out below or elsewhere in this Agreement.

          "Advance"  means, with respect to a Mortgage  Loan,  an
advance by the servicer of such Mortgage Loan of its own funds to
make  payments of principal, interest, taxes, insurance premiums,
ground  rents,  assessments, foreclosure related  costs,  amounts
transferred  for  NSF checks, and similar charges  advanced  with
respect  to  a  Mortgage Loan as required  or  permitted  by  the
Applicable Requirements or the Investor.

          "Advance Settlement Date" has the meaning set forth  in
Section 2.3.

          "Affiliate" means, in respect of any Person, any  other
Person directly or indirectly controlling, controlled by or under
direct  or  indirect  common control with, such  Person,  whether
through  the  ownership  of  voting securities,  by  contract  or
otherwise.   "Control" as used herein means the power  to  direct
the management and policies of such Person.

          "Agencies"  or "Agency" means FNMA, FHLMC, FmHA,  GNMA,
FHA, VA and/or a State Agency, as applicable.

          "Agreement" means this Mortgage Servicing Purchase  and
Sale Agreement, together with its Exhibits and Schedules.

          "Ancillary Income" means all income from or relating to
the  Mortgage Loans to which the servicer is entitled other  than
servicing  fees,  including  but not  limited  to  late  charges,
insufficient  funds  fees,  assumption fees,  optional  insurance
amounts and all other incidental fees and charges.

          "Applicable Requirements" with respect to any  Mortgage
Loan,  shall  include: (i) all applicable contractual obligations
contained  in  the Mortgage and Mortgage Note, in  the  Servicing
Agreement  and  in  policies  of  insurance  pertaining  to  such
Mortgage  Loans,  (ii)  all applicable  Laws  pertaining  to  the
processing,  origination insuring, purchase, sale,  servicing  or
subservicing  of  the Mortgage Loans, (iii) all other  applicable
requirements and guidelines of each Governmental Authority having
jurisdiction  (including without limitation, FNMA,  FHLMC,  FmHA,
GNMA,  FHA  and VA, and their respective selling and/or servicing
guides), (iv) all applicable requirements and guidelines  of  PMI
companies  and Investors, and (iv) to the extent not  covered  by
the  foregoing,  the reasonable and customary mortgage  servicing
practices of prudent mortgage lending institutions which  service
mortgage  loans  of the same type as the Mortgage  Loans  in  the
jurisdictions  in  which  the  related  secured  properties   are
located.

          "Business Day" means a day other than Saturday, Sunday,
or any other day on which commercial banks in Denver, Colorado or
New  York,  New  York  are  authorized or  required,  by  law  or
executive order, to close.

          "Certified Pool" means, as of any date, a Pool that has
received (i) original final certification in compliance with  the
GNMA  Guide,  and (ii) if issuer responsibility with  respect  to
such  Pool  has been transferred subsequent to issuance  of  such
Pool  but  prior to the transfer contemplated by this  Agreement,
recertification in compliance with the GNMA Guide with respect to
each such transfer.

          "Custodian  File" means the documents required  by  the
applicable  Agency or the Investor under the Servicing Agreements
to  be  retained by a document custodian acceptable to the Agency
or the Investor, or by the Agency or the Investor.

          "Designee" means the Person designated by Purchaser  to
perform the obligations of the Purchaser under this Agreement  or
any  of  the  Exhibits  hereto,  which  Person  shall  reasonably
acceptable to Seller.

          "Fed  Funds  Rate" means, as of any date, the  rate  of
interest published by The Wall Street Journal, Northeast Edition,
in the money rates column, as the "Federal Funds Rate" or if such
rate  is no longer published, an alternate rate of interest  that
is reasonably acceptable to the Parties.

          "FHA" means the Federal Housing Administration, or  any
successor thereof.

          "FHLMC"   means   the   Federal  Home   Loan   Mortgage
Corporation, or any successor thereof.

          "FmHA"  means  the  Farmers  Home  Administration,  the
United States of America acting through Rural Housing Services or
its successor, the US Department of Agriculture, or any successor
thereof.

          "FNMA" means the Federal National Mortgage Corporation,
or any successor thereof.

          "GNMA"   means   the   Government   National   Mortgage
Corporation, or any successor thereof.

          "GNMA  Subserviced  Loans" means those  Mortgage  Loans
included  in  GNMA Pools that, as of the Servicing Transfer  Date
applicable to GNMA Mortgage Loans, are not Certified Pools.

          "GNMA  Subservicing Agreement" means  the  Subservicing
Agreement (GNMA) between the Parties substantially in the form of
Exhibit C.

          "GNMA  Subservicing Period" means, with  respect  to  a
GNMA  Subserviced Loan, the period commencing with the  Servicing
Transfer  Date  applicable to GNMA Mortgage Loans and  continuing
through  and  until the related GNMA Pool has become a  Certified
Pool  and the Investor Consent is received with respect  to  such
GNMA Subserviced Loan.

           "GO Portfolio Mortgage Loans" means the Mortgage Loans
which  are indicated to be included in "GO Portfolio" on Schedule
3.1(l)(1).

          "GO  Portfolio Pools" means all Pools consisting of  GO
Portfolio Mortgage Loans.

          "GO  Portfolio Purchase Price Percentage"  means  0.92%
(92  basis  points),  subject to adjustment  in  accordance  with
Section 2.2(c).

          "Governmental  Authority"  means  any  federal,  state,
municipal,  local, territorial, or other governmental department,
commission,   board,   bureau,  agency,   court,   authority   or
instrumentality, domestic or foreign.

          "Guaranty"    means    the   Unconditional    Guaranty,
substantially in the form of Exhibit D, to be made by  Harbourton
Holdings,  L.P.,  a  Delaware limited partnership,  in  favor  of
Purchaser.

          "Indemnified  Events"  has the  meaning  set  forth  in
Article VIII.

          "Indemnified  Party" means a Party that  benefits  from
indemnification  or  seeks  indemnification  from  another  Party
pursuant to Article VIII.

          "Indemnifying   Party"   means   a   Party    providing
indemnification to another Party pursuant to Article VIII.

          "Insurer" means FHA or VA, any PMI insurer or any other
insurer that provides policies of life, hazard, disability, title
or  other insurance with respect to any of the Mortgage Loans  or
the collateral securing a Mortgage Loan.

          "Interim  Period" means, with respect to  any  Mortgage
Loan,  the  period commencing with the Sale Date  and  continuing
through and until the applicable Servicing Transfer Date.

          "Interim   Servicing  Agreement"  means   the   Interim
Servicing Agreement between the Parties substantially in the form
of Exhibit A.

          "Investor Consent" means, with respect to any  Pool  or
Mortgage Loan, the written consent and approval of the applicable
Investor  to  the  transfer  from  Seller  to  Purchaser  of  the
Servicing Rights and issuer responsibility with respect  to  such
Pool  or Mortgage Loan in accordance with the provisions  of  the
related    Servicing   Agreement,   without   material    adverse
modification to the rights of the servicer thereunder.

          "Investor"  means  FNMA, FHLMC,  GNMA  or  any  Private
Investor party to a Servicing Agreement relating to the servicing
or subservicing of the Mortgage Loans, as the case may be.

          "Law"  means  any  applicable statute, law,  ordinance,
regulation,   order,  writ,  injunction,   or   decree   of   any
Governmental Authority.

          "Lien"   means  any  mortgage,  pledge,  hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory  or
otherwise), or preference, priority, or other security agreement,
or  preferential  arrangement of any kind  or  nature  whatsoever
(including,  without limitation, any conditional  sale  or  other
title   retention   agreement,   any   financing   lease   having
substantially  the same economic effect as any of the  foregoing,
and  the  filing  of  any financing statement under  the  Uniform
Commercial Code or comparable law of any jurisdiction  in respect
of any of the foregoing).

          "Losses"   means   any   and   all   claims,   damages,
liabilities,  losses, deficiencies, or reasonable out  of  pocket
costs  and  expenses,  (including, without limitation,  counsel's
fees) of any kind or nature actually incurred associated with the
conveyance  of  the  Servicing Rights  from  the  Seller  to  the
Purchaser.

          "Mortgage,  Custodial and Escrow  Accounts"  means  all
escrow,  impound and custodial accounts relating to the  Mortgage
Loans including, without limitation, all accounts established for
purposes  of  receiving funds for the payment  of  principal  and
interest  or real or personal property taxes, insurance premiums,
ground rents, assessments, funds due the Investor, unearned fees,
hazard  insurance loss drafts, Advances, funds held in connection
with buy-down loans, and similar charges relating to the Mortgage
Loans  and interest accrued on such funds for the benefit of  the
Mortgagors under Applicable Requirements or otherwise.

          "Mortgage   Loan  Schedule"  means  Schedule  3.1(l)(1)
hereto.

          "Mortgage  Loans"  means  the  single-family   mortgage
loans  secured by the related Mortgages, the Servicing Rights  to
which mortgage loans are to be sold to Purchaser pursuant to this
Agreement,  which Mortgage Loans are listed on the Mortgage  Loan
Schedule.

          "Mortgage Note" means, with respect to a Mortgage Loan,
the  promissory  note  or other evidence of indebtedness  of  the
related Mortgagor.

          "Mortgage" means, with respect to a Mortgage Loan,  the
instrument  securing the related Mortgage Note  which  creates  a
first lien on the related Mortgaged Property.

          "Mortgaged Property" means, with respect to a  Mortgage
Loan,  a  fee  simple  interest  in  residential  real  property,
together  with improvements thereon, subject to the lien  of  the
related Mortgage.

          "Mortgagor" means, with respect to a Mortgage Loan, the
obligor on the related Mortgage Note.

          "NSF Check" means a check tendered by a Mortgagor as  a
payment  on  a Mortgage Loan that is returned by the drawee  bank
because  of  insufficient  funds,  including  without  limitation
insufficient funds due to funds being denominated as uncollected.

          "Operative Documents" means this Agreement, the Interim
Servicing Agreement, the Private Investor Subservicing Agreement,
the   GNMA   Subservicing  Agreement,  each  Investor  assignment
agreement,  each  bill  of  sale and  assignment  and  assumption
agreement,  and all other documents or instruments  executed  and
delivered in connection with this Agreement or any of such  other
agreements  or  any  of the transactions contemplated  hereby  or
thereby.

          "Parties" means Purchaser and Seller.

          "Person" means an individual, partnership, corporation,
business   trust,   joint  stock  company,  trust,   incorporated
association,  joint  venture,  Governmental  Authority  or  other
entity  of  whatever nature, and in each case includes  permitted
successors and assigns..

          "PMI" means any private mortgage insurer.

          "Pool Schedule" means Schedule 3.1(l)(2) hereto.

          "Pool" means an aggregation of one (1) or more Mortgage
Loans identified on the Pool Schedule.

          "Portfolio  B Mortgage Loans" means the Mortgage  Loans
which  are indicated to be included in "Portfolio B" on  Schedule
3.1(l)(2).

          "Portfolio  B  Pools"  means all  Pools  consisting  of
Portfolio B Mortgage Loans.

          "Portfolio  B  Purchase Price Percentage"  means  1.49%
(149  basis  points), subject to adjustment  in  accordance  with
Section 2.2(c)..

          "Portfolio" means either the Portfolio B Mortgage Loans
or the GO Portfolio Mortgage Loans, as the context may require.

          "Prior Servicer" means any originator or servicer of  a
Mortgage Loan, other than Seller.

          "Private  Investor"  means any owner  of  the  Mortgage
Loans  other  than  an  Agency  party to  a  Servicing  Agreement
relating to the servicing of the Mortgage Loans.

          "Private   Investor  Subserviced  Loans"  means   those
Private  Investor  Mortgage  Loans as  to  which  the  applicable
Investor Consent has not been obtained on or prior to the related
Servicing Transfer Date.

          "Private  Investor  Subservicing Agreement"  means  the
Subservicing  Agreement (Private Investor)  between  the  Parties
substantially in the form of Exhibit B.

          "Private  Investor  Subservicing  Period"  means,  with
respect  to  any  Private Investor Subserviced Loan,  the  period
commencing  with  the  applicable  Servicing  Transfer  Date  and
continuing  through and until the applicable Investor Consent  is
obtained or the related Servicing Agreement is terminated.

          "Purchase Price Schedule" has the meaning set forth  in
section 2.2.

          "Purchase  Price" means the amount payable by Purchaser
to Seller for the Servicing Rights as set forth in Section 2.2.

          "Purchaser's  Document Custodian"  means  one  or  more
document custodian(s) designated by Purchaser from time  to  time
that  is  acceptable  to  the applicable Investors  to  hold  the
Custodian Files.

          "Repurchase Balance" means the unpaid principal balance
as of the date of repurchase of a Mortgage Loan to be repurchased
in accordance with Section 8.5.

          "Repurchase Price" means the sum of (a) the  Repurchase
Balance, plus all interest accrued thereon through the end of the
month  of repurchase (if repurchase is required by the applicable
Investor), (b) the product of the Repurchase Balance and  the  GO
Portfolio Purchase Price Percentage (if paid) in the case of a GO
Portfolio  Loan or the Portfolio B Purchase Price Percentage  (if
paid)  in  the case of a Portfolio B Mortgage Loan  and  (c)  all
reasonable unreimbursed out-of-pocket costs and expenses incurred
by Purchaser relating to the subject Mortgage Loan, including but
not limited to reasonable unreimbursed Advances.

          "Sale Date" means July 31, 1997.

          "Servicing  Agreement" means a pool purchase  contract,
whole  loan  sale  and servicing contract or other  servicing  or
subservicing  contract pursuant to which the Seller is  servicing
or  subservicing a Mortgage Loan or a pool of Mortgage  Loans  on
behalf  or  for the benefit of an Investor, as indicated  on  the
Servicing Agreement Schedule.

          "Servicing Agreement Schedule" means Schedule 3.1(l)(3)
hereto.

          "Servicing  File"  means, with respect  to  a  Mortgage
Loan, the file containing all documents in Seller's possession or
control, whether on hard copy, computer record, microfiche or any
other  format, evidencing and pertaining to a particular Mortgage
Loan  and  relating  to  the processing, origination,  servicing,
collection,  payment  and  foreclosure  of  such  Mortgage  Loan,
including  (i) copies of certain documents executed or  delivered
in  connection with the closing of such Mortgage Loan,  including
without limitation copies of the Mortgage Note, Mortgage and  any
assignments   of   such   Mortgage,  and   (ii)   any   servicing
documentation  which relates to such Mortgage Loan  of  the  type
customarily  included  by  mortgage  loan  servicers   in   their
servicing files.  The Servicing File for each Mortgage Loan shall
include  all documents required to be maintained under,  or  that
are necessary to comply with, Applicable Requirements.

          "Servicing    Rights"    means    the    rights     and
responsibilities  of  Seller with respect  to  the  servicing  or
subservicing  of the Mortgage Loans under Applicable Requirements
and  the  right  to  receive servicing fees and ancillary  income
thereunder,  and  the  associated right, title  and  interest  of
Seller  in  the  related  Mortgage Loans, Pools,  Mortgage  Note,
Mortgage Escrow Accounts, Custodian File, and Servicing File.

          "Servicing  Transfer Date" means,  with  respect  to  a
Mortgage  Loan,  the  date on which physical  servicing  of  such
Mortgage  Loan  transfers from Seller to Purchaser.   Subject  to
modification  by written agreement of the Parties, the  Servicing
Transfer  Date  will be the close of business on (i)  August  31,
1997 for all FNMA Mortgage Loans, (ii) September 2, 1997 for  all
GNMA  Mortgage  Loans, (iii) September 15,  1997  for  all  FHLMC
Mortgage  Loans  and  (iv) the applicable  Investor  cutoff  date
immediately  following August 31, 1997 for all  Private  Investor
Mortgage Loans.

          "State Agency" means any state agency with authority to
(i)  regulate  the  businesses of Purchaser or Seller,  including
without  limitation any state agency with authority to  determine
the  investment or servicing requirements with regard to mortgage
loans originated, purchased or serviced by Purchaser or Seller or
(ii) originate, purchase, or service mortgage loans, or otherwise
promote mortgage lending, including without limitation state  and
local housing finance authorities.

          "Survival Period" has the meaning set forth in  Section
8.1.

            "Transfer Instructions" means the actions to be taken
and procedures to be followed in connection with the transfer  of
the Servicing Rights to Purchaser as set forth on Exhibit E.

          "VA  Buy-down"  means with respect to a  Mortgage  Loan
that  is  guaranteed  by the VA, the waiver  by  Purchaser  of  a
portion of the indebtedness of the Mortgage Loan, which can  take
the  form of a reduction of the principal, a credit to escrow  or
unapplied funds accounts, the forgiveness of accrued interest  or
any  combination of the foregoing, and which causes the VA to pay
off the remaining amount of the indebtedness owed and acquire the
collateral securing the Mortgage Loan.

          "VA   No-Bid-Mortgage  Loan"  means  a  Mortgage   Loan
guaranteed by the VA and for which the VA provides written notice
that  it will not accept conveyance of the property securing said
Mortgage  Loan  after  such Mortgage  Loan  has  been  placed  in
foreclosure.

          "VA"  means  the United States Department  of  Veterans
Affairs, or any successor thereof.

          Section  1.2     Interpretations.  In  this  Agreement,
unless  specified otherwise: (i)  "Any" means "any one or  more";
"including"  means  "including without limitation";  "day"  means
"calendar  day,"  unless  "Business  Day"  is  specified.    (ii)
Singular  words include plural, and vice versa. For example,  the
words  "Party" and "Parties" each means "Party or Parties as  the
case  may be."  (iii)  Headings are for convenience only, and  do
not  affect the meaning of any provision.  (iv)  Reference to  an
agreement   includes  reference  to  its  permitted  supplements,
amendments  and  other modifications.  (v)  Reference  to  a  law
includes  reference to any amendment or modification of  the  law
and   to  any  rules  or  regulations  issued  thereunder.   (vi)
Reference  to  a  Person  includes  reference  to  its  permitted
successors  and  assigns  in  the  applicable  capacity.    (vii)
Reference  to a Section, Exhibit, or Schedule signifies reference
to  a Section, Exhibit, or Schedule of this Agreement, unless the
context   clearly   indicates  otherwise.   (viii)   "Hereunder,"
"hereto," "hereof," "herein," and like words, refer to the  whole
of this Agreement rather than to a particular part hereof, unless
the context clearly indicates otherwise.


                           ARTICLE II
             PURCHASE AND SALE OF SERVICING RIGHTS;
              PURCHASE PRICE; ADDITIONAL COVENANTS
                                
          Section 2.1    Purchase and Sale of Servicing Rights.

               (a)   Sale  Date Conveyance.  Upon the  terms  and
subject  to the conditions of this Agreement and on the basis  of
the  representations, warranties and agreements contained herein,
effective  as  of  the  close  of  business  on  the  Sale   Date
(regardless  of the date of execution of this Agreement),  Seller
hereby  sells,  assigns,  transfers,  conveys  and  delivers   to
Purchaser all of Seller's beneficial right, title and interest in
and  to  the Servicing Rights related to the Mortgage Loans,  and
Purchaser hereby purchases and assumes the beneficial interest in
the Servicing Rights related to the Mortgage Loans from Seller as
of such date.

               (b)  Servicing Transfer Date Conveyance.  Upon the
terms and subject to the conditions of this Agreement and on  the
basis of the representations, warranties and agreements contained
herein,  effective  as of the commencement of  business  on  each
Servicing  Transfer  Date, Seller shall sell,  assign,  transfer,
convey and deliver to Purchaser, legal title, and all of Seller's
remaining right, title and interest in and to the Mortgage  Loans
and the Servicing Rights related to the Mortgage Loans, including
the  obligation to service the Mortgage Loans from and after such
date,  and  Purchaser hereby purchases and assumes such Servicing
Rights  from Seller as of such Servicing Transfer Date; provided,
that, subject to Section 2.6 below, Seller shall not transfer  or
convey to Purchaser legal or record title to the Servicing Rights
relating to any GNMA Subserviced Loans or to any Private Investor
Subserviced  Loans  until the applicable Investor  Consents  have
been obtained.  The transfer of servicing responsibility will  be
conducted  in accordance with the Transfer Instructions.   Except
as  otherwise  provided  herein, as of each  Transfer  Date,  the
Seller  will  cease all servicing activities and responsibilities
with   respect  to  the  Mortgage  Loans  and  shall  sever   its
relationship with the Mortgagors.

          Section 2.2    Purchase Price.

          (a)   Purchase  Price.  In full consideration  for  the
sale  of  the Servicing Rights, Purchaser shall pay to  Seller  a
purchase price (the "Purchase Price") equal to the sum of:

               (i)   the  product  of (x)  the  Portfolio  B
     Purchase Price Percentage and (y) the aggregate  unpaid
     principal  balance,  as  of  the  Sale  Date,  of   the
     Portfolio B Mortgage Loans;
     
               plus
     
               (ii)  the  product  of (x) the  GO  Portfolio
     Purchase Price Percentage and (y) the aggregate  unpaid
     principal  balance,  as of the Sale  Date,  of  the  GO
     Portfolio Mortgage Loans.
     
          (b)   Purchase Price Schedule.  No fewer than  two  (2)
Business Days prior to the Sale Date, the Seller shall deliver to
the  Purchaser a schedule containing the information required  by
Schedule 2.2(b) (the "Purchase Price Schedule") setting forth the
Seller's  calculation  of the Purchase  Price,  the  Portfolio  B
Purchase Price and the GO Portfolio Purchase Price, in each  case
estimated as of the last day of the calendar month preceding  the
Sale  Date.   Seller  shall  deliver a revised  Schedule  2.2(b),
incorporating  any applicable adjustments to the  Purchase  Price
and including the amount of the related Advances on or before the
third (3rd) Business Day after each Servicing Transfer Date.  The
Purchase  Price  Schedules  shall also  include  all  information
necessary to calculate the weighted average servicing fee for the
Mortgage Loans for purposes of Section 2.2(c).

          (c)  Adjustment to Purchase Price Percentages.  The  GO
Portfolio Purchase Price Percentage and the Portfolio B  Purchase
Price  Percentage may each be adjusted upward or downward  on  or
prior  to  the Sale Date in accordance with this Section  2.2(c).
If  the  weighted  average servicing fee  for  the  GO  Portfolio
Mortgage Loans is different than 41 basis points (0.41%), the  GO
Portfolio  Purchase Price Percentage shall be adjusted by  adding
thereto  the product (whether positive or negative) of  (x)  2.25
times  (y)  the  difference between the actual  weighted  average
servicing fee for the GO Portfolio Mortgage Loans as of the  Sale
Date  and  41  basis points (0.41%).  Similarly, if the  weighted
average  servicing  fee for the Portfolio  B  Mortgage  Loans  is
different  than  38.2  basis points (0.382%),  the  GO  Portfolio
Purchase Price Percentage shall be adjusted by adding thereto the
product (whether positive or negative) of (x) 3.90 times (y)  the
difference between the actual weighted average servicing fee  for
the Portfolio B Mortgage Loans as of the Sale Date and 38.2 basis
points  (0.382%).  By way of example only, if the actual weighted
average servicing fee for the GO Portfolio Mortgage Loans  as  of
the Sale Date is 40 basis points, the GO Portfolio Purchase Price
Percentage  would be adjusted downward by 2.25  basis  points  (-
0.0225%).   All information necessary to calculate  the  weighted
average servicing fee for the Mortgage Loans shall be included on
the Purchase Price Schedules delivered in accordance with Section
2.2(b).

          Section 2.3    Payment of Purchase Price.

          On  the  Sale  Date, Purchaser shall pay Seller  thirty
percent  (30%)  of the estimated Purchase Price calculated  based
upon the Purchase Price Schedule delivered prior to the Sale Date
in accordance with Section 2.2(b).

          Within  two (2) Business Days after Purchaser's receipt
of  the  Purchase  Price Schedule to be delivered  by  Seller  in
accordance  with  Section  2.2(b) after each  Servicing  Transfer
Date,  Purchaser shall pay Seller the remaining  balance  of  the
Purchase  Price  relating  to  the Mortgage  Loans  as  to  which
Servicing Rights are transferred on such Servicing Transfer  Date
calculated based upon the Purchase Price Schedule delivered after
the applicable Servicing Transfer Date, together with interest on
such portion of the Purchase Price at the Fed Funds Rate from the
Sale Date to the date payment is made.

          Unless  otherwise agreed by the parties,  all  payments
required  hereunder  shall  be made  by  bank  wire  transfer  in
immediately available funds.

          If  any  of  the  information used in  calculating  the
Purchase Price shall be found by a Party to have been incorrectly
computed or the Purchase Price shall be found by a Party to  have
been otherwise calculated improperly, the Purchase Price shall be
promptly  and appropriately adjusted on the basis of the  correct
and  proper  information.   Payment  or  reimbursement  shall  be
promptly  made  by the appropriate Party after  notice  from  the
other Party setting forth in reasonable detail the amount of such
adjustment  claimed  and the basis for such adjustment.   If  any
adjustments  are made to the Purchase Price after the  applicable
Advance Settlement Date in accordance with the provisions of this
Section,  any such adjustment shall include interest at  the  Fed
Funds  Rate  on the amount of the adjustment from the  applicable
Advance Settlement Date to (but not including) the date that  the
payment of such adjustment is made.

          Section 2.4    Reimbursement of Advances.

          On  the  second Business Days after Purchaser's receipt
of  the  Purchase  Price Schedule to be delivered  by  Seller  in
accordance with Section 2.2(b) after each Servicing Transfer Date
(each,  an  "Advance  Settlement  Date"),  Seller  shall  provide
Purchaser with a schedule on a loan-by-loan basis that sets forth
all  Advances  with respect to the Mortgage Loans, the  Servicing
Rights to which were transferred on such Servicing Transfer Date.
On  each  Advance  Settlement  Date,  Purchaser  shall  reimburse
Seller,  by  wire  transfer of immediately available  funds,  one
hundred  percent (100%) of the Advances relating to  the  related
Mortgage Loans.

          For  any  GO  Portfolio Mortgage Loan as to  which  the
first  claim  payment  relating  to  principal  is  received   by
Purchaser from the FHA or VA within two (2) months following  the
Sale Date, Seller shall reimburse Purchaser for any Advances  and
accrued  interest (calculated at the applicable pool pass-through
rate)  that  are not reimbursed by FHA or VA in the insurance  or
guaranty  payments received with respect to such  Mortgage  Loan.
Seller shall make such payment to Purchaser within 30 days of its
receipt of an invoice therefor from Purchaser, accompanied  by  a
detail of the claim payments received.

          In addition, for any Mortgage Loan that, as of the Sale
Date,  is  either current or not more than thirty (30) days  past
due,  Seller shall upon Purchaser's written demand (which  demand
shall  be  received by Seller not more than five (5) years  after
the  Sale Date), reimburse Purchaser for any Advance paid for  by
Purchaser pursuant to the first paragraph of this Section 2.4  to
the extent that such Advance is not reimbursable to the Purchaser
by  the  applicable  Mortgagor, Investor or Insurer  pursuant  to
Applicable  Requirements.   Seller shall  make  such  payment  to
Purchaser  within  30 days of its receipt of an invoice  therefor
from  Purchaser, accompanied by a detail of the Advance  and  the
reason  that  such Advance is deemed to be not reimbursable  from
the  applicable  Mortgagor,  Investor  or  Insurer  pursuant   to
Applicable  Requirements.  Seller shall not  be  liable  for  any
Advances  that  become unreimbursable after the Sale  Date  as  a
result  of  any  delay  or  omission  by  the  Purchaser  or  any
subsequent servicer of the applicable Mortgage Loans.

          Section 2.5    Interim Servicing.

          Seller  shall  continue to service the  Mortgage  Loans
during   the   Interim  Period  in  accordance  with   Applicable
Requirements pursuant to the Interim Servicing Agreement.

          Section 2.6    Subservicing.

          (a)   Purchaser  or its Designee shall  subservice  the
Private Investor Subserviced Loans on behalf of Seller during the
Private   Investor   Subservicing  Period  in   accordance   with
Applicable  Requirements  and the Private  Investor  Subservicing
Agreement.   During  the  Private Investor  Subservicing  Period,
Seller  will cooperate reasonably with Purchaser or its  Designee
to   facilitate  Purchaser's  performance  of  its   subservicing
obligations   pursuant  to  the  Private  Investor   Subservicing
Agreement.  Such cooperation will include appointment of  certain
employees of Purchaser or its Designee as officers of Seller  for
the limited purpose of performing certain necessary and delegable
Private Investor reporting functions including without limitation
Investor   remittance.   Upon  receipt  of  applicable   Investor
Consents, all of Seller's right title and interest in and to  the
Servicing  Rights  and  Escrow Accounts related  to  the  Private
Investor  Subserviced Loans for which such Investor  Consent  has
been obtained, including without limitation record title and  the
obligation to service the applicable Private Investor Subserviced
Loans, shall be transferred to Purchaser.

          (b)   Purchaser  or its Designee shall  subservice  the
GNMA  Subserviced  Loans  on behalf of  Seller  during  the  GNMA
Subservicing  Period  in accordance with Applicable  Requirements
and   the   GNMA   Subservicing  Agreement.   During   the   GNMA
Subservicing   Period,   Seller  will   perform   its   remaining
obligations as servicer of the GNMA Subserviced Loans pursuant to
Applicable  Requirements  and  will  cooperate  reasonably   with
Purchaser  or its Designee to facilitate Purchaser's  performance
of its subservicing obligations pursuant to the GNMA Subservicing
Agreement.  Such cooperation will include appointment of  certain
employees of Purchaser or its Designee as officers of Seller  for
the limited purpose of performing certain necessary and delegable
GNMA  reporting  functions including without limitation  Investor
remittance.   Notwithstanding anything to the contrary  contained
herein, until the applicable Investor Approval Date, Seller shall
retain record title in and to the Servicing Rights related to the
GNMA  Subserviced  Loans and shall remain as Servicer  of  record
with   the   GNMA,  and  fully  subject  to  GNMA's  rights   and
requirements with respect to the Servicing.  Purchaser and Seller
acknowledge that Purchaser or its designee will be identified  to
GNMA  as  the  subservicer  of the  Pools  related  to  the  GNMA
Subserviced  Loans  effective as of the Servicing  Transfer  Date
applicable  to  GNMA  Mortgage  Loans.   Upon  receipt   of   the
applicable  Investor  Consent, all of Seller's  right  title  and
interest  in  and  to  the Servicing Rights and  Escrow  Accounts
related   to  the  GNMA  Subserviced  Loans,  including   without
limitation  record title and the obligation to service  the  GNMA
Subserviced Loans, shall be transferred to Purchaser.

          Section   2.7     Mortgage  Escrow  Accounts:  Optional
Insurance Payments.

          On each Advance Settlement Date, Seller shall transfer,
by  wire transfer of immediately available funds, to accounts  in
Purchaser's  name as custodian or trustee, in  one  (1)  or  more
depository institutions identified by Purchaser and acceptable to
each  applicable  Investor, the Mortgage Escrow Account  balances
relating  to  the related Mortgage Loans.  Such payment  will  be
accompanied  by  an  itemized statement of  the  Mortgage  Escrow
Account  balances  and the outstanding Advances,  reflecting  the
balances as of the applicable Advance Settlement Date, sufficient
to  enable Purchaser to reconcile the amount of such payment with
the  accounts  of  the related Mortgage Loans.   Purchaser  shall
review  the  accuracy  of Seller's accounting  statement  of  the
Mortgage  Escrow Account balances and, in the event of an  error,
the  amount  of the Mortgage Escrow Account balances  transferred
shall  be  adjusted  and  Seller  shall  pay  to  Purchaser   any
additional  amounts  of  Mortgage  Escrow  Account  balances   or
Purchaser shall reimburse Seller for any overpayment of  Mortgage
Escrow Account balances, as the case may be, by wire transfer  of
immediately available funds.  Seller shall be obligated to credit
to  the Mortgage Escrow Accounts any interest accrued on Mortgage
Escrow   Account  balances  in  accordance  with  any  Applicable
Requirements  prior  to or on the applicable  Advance  Settlement
Date.   On  or before each Advance Settlement Date, Seller  shall
remit  to  all  applicable  optional  insurance  carrier(s)   all
optional insurance premiums, if any, being held by Seller for, or
on  behalf of, any Mortgagors that have not yet been remitted  to
the optional insurance carriers.

          If   under  Applicable  Requirements,  the  Seller   is
required to make the remittance to one or more Investors  in  the
month  following or in which the Servicing Transfer Date  occurs,
the  Purchaser shall retransfer to the Seller the amount  of  the
required   Investor  remittance  on  or  before  the   applicable
remittance date, upon written notification from the Seller to the
Purchaser  of the amount of monies required in order  to  fulfill
these  remittance  obligations.  Written notification  should  be
forwarded by Seller to Purchaser at least three (3) Business Days
in advance of the required remittance date.

          Section 2.8    Closing.

          The  closing  hereunder shall take place  on  the  Sale
Date,  and  shall,  at  Purchaser's  option,  be  either  (a)  by
telephone, confirmed by letter, facsimile transmission or wire as
the  Parties  shall agree, or (b) conducted in  person,  at  such
place as the Parties shall agree.

                           ARTICLE III
            REPRESENTATIONS AND WARRANTIES OF SELLER
                                
          Section 3.1.   Seller's Representations and Warranties.

          Seller  represents and warrants to Purchaser as follows
as of the Sale Date and the Servicing Transfer Date:

               (a)   Organization  and Qualification.   It  is  a
limited partnership duly organized, validly existing, and in good
standing,  under the laws of the jurisdiction of  its  formation,
has  the authority and power necessary to own its assets  and  to
transact  the  business  in which it  is  engaged,  and  is  duly
qualified   and  in  good  standing  to  do  business   in   each
jurisdiction  in  which  the  conduct  of  its  business  or  the
ownership  of its assets (including the Servicing Rights  or  the
Mortgage Loans) so requires.

               (b)  Authorization; Enforceability; Execution.  It
has  the  absolute and unrestricted right, power, authority,  and
capacity to execute and deliver this Agreement and each Operative
Document,   and   to  perform  its  obligations   hereunder   and
thereunder.  It has duly authorized, executed, and delivered this
Agreement and each Operative Document.  This Agreement  and  each
Operative  Document  constitute the  legal,  valid,  and  binding
obligation  of Seller, enforceable against it in accordance  with
their   respective  terms,  except  to  the  extent   bankruptcy,
insolvency,  reorganization, fraudulent  conveyance,  or  similar
laws affect the enforcement of creditors' rights generally.   The
signatory executing this Agreement and each Operative Document is
duly authorized to execute and deliver each such document.

               (c)    Non-Contravention.    Its   execution   and
delivery of this Agreement and each Operative Document,  and  the
consummation   and   performance  of  any  of  the   transactions
contemplated  hereby  or thereby, do not  and  will  not:  (i)(A)
violate  any applicable law or any judgment, award, order,  writ,
or  decree  of  any  court or other Governmental  Authority,  (B)
violate  any  Mortgage  Loan  Requirement,  or  (C)  violate  any
provision   of  its  partnership  agreement;  (ii)  violate   any
provision  of, or cause a default under, any mortgage, indenture,
contract, agreement, or other undertaking to which it is a  party
or that purports to be binding upon it or upon any of its assets;
or  (iii) result in the creation or imposition of any lien on any
of its assets.

               (d)   Consents.  Other than the Investor Consents,
no   consent  of  any  other  Person  (including  such   Person's
shareholders) and no consent, license, approval, or exemption by,
or authorization of, or registration, filing or declaration with,
any  Governmental Authority or any other Person, is necessary  to
(i)  its execution, delivery or performance of this Agreement  or
any Operative Document, or (ii) the validity or enforceability of
this Agreement or any Operative Document.

               (e)   No-Default.   It is not in default,  and  no
event  or  condition exists that after the giving  of  notice  or
lapse of time or both, would constitute an event of default under
any  material mortgage, indenture, contract, agreement, judgment,
or other undertaking, to which it is a party or which purports to
be binding upon it or upon any of its assets.

               (f)   Approvals.  It is an approved FNMA and FHLMC
Seller/Servicer, GNMA Issuer/Servicer, FmHA Servicer, and FHA and
VA  mortgagee  in good standing and has not been suspended  as  a
mortgagee or servicer by any of FNMA, FHLMC, GNMA, FmHA,  FHA  or
the  VA.   It has all federal, state and local licenses, permits,
and other authorizations of Governmental Authorities required for
the  conduct  of its business with respect to the Mortgage  Loans
and  the  Servicing Rights, including but not  limited  to  state
mortgage  banking  licenses  in those  jurisdictions  where  such
licenses are necessary for the conduct of Seller's business,  and
Seller  has  not  received any notice that  revocation  is  being
considered  with  respect to any of such  licenses,  permits,  or
authorizations.  It knows of no reason why any Investor would not
consent to the transfer contemplated by this Agreement.

               (g)  Financial Statements; Solvency.  It meets all
minimum  net worth or similar requirements necessary in order  to
conduct its business which are applicable to Seller under any law
or  any requirement of any regulatory agency, Investor, or  other
authority.  Attached hereto as Schedule 3.1(g) is a copy  of  its
audited  balance sheet as of December 31, 1996, and its unaudited
balance sheet as at March 31, 1997, and the related statements of
income,  retained earnings and changes in financial position  for
the  periods  then  ended (collectively, the "Seller's  Financial
Statements").   Seller's Financial Statements present  fairly  in
all material respects the financial condition of Seller as of the
dates, and for the periods, covered thereby, and were prepared in
accordance  with  GAAP through the periods involved.   There  has
been  no  change in the financial condition of Seller  since  the
date of Seller's Financial Statements which would have a material
adverse  effect  upon  the  ability of  Seller  to  complete  the
transactions   contemplated   herein   and   comply   with    its
responsibilities    and    obligations   hereunder.     Purchaser
acknowledges  that  Seller's parent has  publicly  announced  its
intention to liquidate its assets and since the date of  Seller's
Financial Statements Seller has entered into agreements to sell a
substantial part of its servicing and mortgage loan portfolio.

               On the Sale Date and each Servicing Transfer Date,
and  after giving effect to each of the transactions contemplated
to  occur on such date, it will not be insolvent and has, or will
have  as  of  such date, adequate net worth to meet all  Investor
requirements.

               (h)   Insurance.   It maintains insurance  against
liability  to  third  parties to the extent  and  in  the  manner
required  by  the  Applicable  Requirements,  including   without
limitation  errors  and  omissions insurance  and  fidelity  bond
coverage  in  accordance with the Applicable  Requirements.   All
such  insurance policies maintained by Seller are in  full  force
and effect.

               (i)   Compliance with Law.  It has complied in all
material  respects  with all applicable Laws,  the  violation  of
which  might  materially and adversely effect its  operations  or
financial condition or delay the consummation of the transactions
contemplated hereby.

               (j)   Litigation.  Except as set forth on Schedule
3.1(j),  there  are  no  lawsuits, actions, proceedings,  claims,
orders  or investigations by or before any Governmental Authority
pending or, to Seller's best knowledge, threatened against it  or
its  Affiliates  relating to the Mortgage  Loans,  the  Servicing
Rights,  the Escrow Balances, the Servicing Agreements or seeking
to  enjoin the transactions contemplated hereby and there are  no
facts  or  circumstances known to Seller that could result  in  a
claim   for  damages  or  equitable  relief  which,  if   decided
adversely,  could,  individually or  in  the  aggregate,  have  a
material  adverse effect on the value of the Servicing Rights  or
Seller's  ability  to  consummate the  transactions  contemplated
hereby.

               (k)   Brokers.   With  the  exception  of  BayView
Financial  Trading Group, Inc. ("BayView"), it has  not  retained
any  broker,  finder, investment banker or financial  advisor  in
connection  with  this  Agreement  or  any  of  the  transactions
contemplated  hereby  that  would  be  entitled  to  a  broker's,
finder's, investment banker's, financial adviser's or similar fee
in  connection therewith.  The fees and expenses of  BayView  are
the sole responsibility of, and shall be paid by, Seller pursuant
to a separate agreement between Seller and BayView.

               (l)  Purchased Asset Schedules.

                      (1)    Mortgage  Loan  Schedule.   Schedule
3.1(l)(1)  (the  "Mortgage Loan Schedule")  identifies  for  each
Portfolio, each Mortgage Loan (including a trial balance for each
such  Mortgage Loan as of April 30, 1997, which balance shall  be
updated as of the Sale Date) that is serviced by Seller under the
Servicing Agreement, the Servicing Rights to which are being sold
to  Purchaser  pursuant  to this Agreement.   The  Mortgage  Loan
Schedule  shall also include a separate listing of  all  Mortgage
Loans   that  are  subserviced  by  Seller  under  the  Servicing
Agreements   which   constitute  subservicing   agreements,   the
Servicing  Rights  to  which are being transferred  to  Purchaser
pursuant  to  this  Agreement.  Such subserviced  Mortgage  Loans
shall  not be deemed included in either the Portfolio B  Mortgage
Loans  or  the  GO  Portfolio Mortgage  Loans,  unless  otherwise
specified on the Mortgage Loan Schedule.

                     (2)  Pool Schedule.  Schedule 3.1(l)(2) (the
"Pool  Schedule")  identifies  for  each  Portfolio,  each   Pool
included  in such Portfolio as of April 30, 1997, which  Schedule
shall  be  updated as of the Sale Date.  When updated as  of  the
Sale  Date,  the  Pool  Schedule shall also  include  a  separate
listing  of  all  GNMA Pools that are to be  subserviced  by  the
Purchaser pursuant to the GNMA Subservicing Agreement.

                     (3)  Servicing Agreement Schedule.  Schedule
3.1(l)(3)  (the  "Servicing Agreement Schedule")  identifies  and
lists each of the Servicing Agreements (including title and  date
of  the  agreement,  whether such agreement  is  a  servicing  or
subservicing  agreement, identity of the Investor and  number  of
loans  serviced  thereunder) pursuant  to  which  the  Seller  is
servicing or subservicing any Mortgage Loans or pools of Mortgage
Loans as of April 30, 1997, which Schedule shall be updated as of
the Sale Date.

               All  of  the information set forth on each of  the
Mortgage  Loan  Schedule,  the Pool Schedule  and  the  Servicing
Agreement Schedule is true, correct and complete as of  the  date
indicated thereon, and when updated as of the Sale Date, will  be
true,  correct and complete as of the Sale Date.  The Seller  has
previously provided the Purchaser with true, correct and complete
copies of each Servicing Agreement and all amendments thereto.

               (m)   Ownership of Servicing Rights.   Subject  to
the  rights  of  the  Investors in the Servicing  Agreements  and
Servicing Rights, Seller has good and merchantable title  to  the
Servicing  Rights, free and clear of all Liens,  other  than  the
lien  of  First  Bank National Association, which lien  shall  be
released  in  accordance with a separate  agreement  between  the
Purchaser, the Seller and First Bank National Association.  There
are  no  contracts affecting the Mortgage Loans, Servicing Rights
or  Advances  to  which Purchaser will be bound  except  for  the
Servicing Agreements and the Applicable Requirements and no other
Person  has  any interest in the Mortgage Loans or the  Servicing
Rights,  except  the Investors to the extent  set  forth  in  the
Servicing Agreements and Applicable Requirements.

          Section  3.2     Mortgage Banking  Representations  and
Warranties.

          Seller  represents and warrants to Purchaser that  each
of  the  representations and warranties set forth below is  true,
complete  and  correct  as of the Sale  Date  and  the  Servicing
Transfer Date with respect to each Mortgage Loan and the  related
Servicing Rights transferred to Purchaser on such date.

               
               (a)  Information.
               
                      (i)   All  information  contained  in  each
Servicing  File, and in any electronic data file, with regard  to
loan  origination and servicing activity contains all information
necessary  to  properly service the Mortgage Loans in  accordance
with  Applicable  Requirements, and is accurate in  all  material
respects,  and all monies received with respect to each  Mortgage
Loan have been properly accounted for and applied.  All Servicing
Files  are  complete  in  all material respects  with  regard  to
origination and servicing activity.
               
                     (ii)  The  amount of the unpaid balance  for
each  Mortgage Loan which is reflected on Schedule  3.1(l)(1)  is
true and correct as of the date thereof.
               
               (b)  Origination and Sale of Mortgage Loans.
               
                     (i)   Each Mortgage Loan has been originated
and/or  sold  in  accordance,  in  all  material  respects,  with
Applicable Requirements, including without limitation, applicable
state  or  federal  laws,  rules, or  regulations  pertaining  to
consumer credit, truth-in-lending and usury.
               
                       (ii)     The   selling   and   origination
representations and warranties made by Seller to Investors  under
the  Servicing  Agreements are true and correct in  all  material
respects as of the date made.
               
               (c)  Enforceability.
               
               Each Mortgage Note and each Mortgage has been duly
executed  by  the appropriate obligor and each  is  a  valid  and
enforceable  document, subject only to applicable  antideficiency
and  bankruptcy  statutes  and to application  of  the  rules  of
equity,  and  there  are  no defenses, setoffs  or  counterclaims
against any Mortgage Loan.
               
               (d)  General Servicing of Mortgage Loans.
               
                     (i)  As of the Sale Date, each Mortgage Loan
has  been serviced in accordance with Applicable Requirements  in
all material respects.
               
                     (ii)  Except as set forth on Schedule 3.2(l)
(which Schedule shall be updated as of the Sale Date), Seller has
not  taken  any action or failed to take any action  which  might
cause  the  cancellation  of  or  otherwise  affect  any  of  the
insurance  contracts pertaining to Servicing of a  Mortgage  Loan
(including without limitation PMI, FHA insurance or VA  guaranty)
or  which  might  otherwise materially and adversely  affect  the
Servicing.
               
               (e)  Mortgage Escrow Accounts.
               
                      (i)   All  Mortgage  Escrow  Accounts   are
maintained in accordance with Applicable Requirements.  Except as
to  payments  which  are past due under the Mortgage  Loans,  all
Mortgage  Escrow Account balances required by the  Mortgage  Loan
Documents and paid to Seller for the account of the Mortgagor and
Seller   are  on  deposit  in  the  appropriate  Mortgage  Escrow
Accounts.
               
                     (ii)  All  payments for taxes,  assessments,
ground  rents, mortgage insurance, hazard and flood insurance  or
other payments made from the related Mortgage Escrow Account have
been made on a timely basis, and Seller has paid to the Mortgagor
interest  on Mortgage Escrow Accounts to the extent such  payment
is  required  by  Applicable Requirements.  Seller  has  properly
conducted  an escrow analysis for each Mortgage Loan  within  the
twelve  (12)  month  period immediately preceding  the  Servicing
Transfer  Date.   All  books and records  with  respect  to  each
Mortgage  Loan  shall be in good condition and  shall  have  been
adjusted to reflect properly the results of the escrow analysis.
               
                      (iii)      Where  applicable,  Seller   has
notified   each   Mortgagor,   in  accordance   with   Applicable
Requirements,  as to any payment adjustments which resulted  from
an  escrow analysis.  Seller shall provide Purchaser with  copies
of   any  notices  and  analyses  prepared  in  accordance   with
subsection (ii) above.
               
               (f)  No Modifications.
               
               Except  with respect to partial releases,  actions
required  by  a  divorce  decree, assumptions,  or  as  otherwise
permitted  under Applicable Requirements, (i) the terms  of  each
Mortgage Note and Mortgage have not been modified by Seller, (ii)
no  party thereto has been released in whole or in part by Seller
and (iii) no part of the Mortgaged Property has been released  by
Seller. The full original principal amount of each Mortgage  Note
listed has been advanced to the Mortgagor.
               
               (g)  Mortgage Insurance.
               
               Except   as  disclosed  in  Schedule  3.2(l),   as
required  by  the  applicable Investor, the  Mortgage  Loans  are
validly insured by mortgage insurance, and all premiums or  other
charges due in connection with such insurance have been paid.
               
               (h)  Hazard Insurance.
               
               There  is  in force with respect to each Mortgaged
Property  a hazard insurance policy that provides, at a  minimum,
for  fire and extended coverage in an amount which is the  lesser
of  (i) the outstanding principal balance of the Mortgage Loan or
(ii)  the  full insurable value of improvements, but in no  event
less than the amount required under Applicable Requirements.   If
required  by  the  Flood  Disaster Protection  Act  of  1973,  as
amended, or by the Investor, each Mortgaged Property is and  will
be covered by a flood insurance policy in an amount not less than
the  lesser  of  (i)  the outstanding principal  balance  of  the
applicable Mortgage Loan, or (ii) the maximum amount of insurance
that  is  available  under the Flood Disaster Protection  Act  of
1973, as amended.
               
               (i)  Condition of Mortgaged Property; Casualties.
               
                     (i)  There exists no damage to any Mortgaged
Property   from  fire,  windstorm,  earthquake,  other  casualty,
environmental  hazard, or any other circumstances  or  conditions
that  would  cause  any  Mortgage Loan to  become  delinquent  or
otherwise   materially  and  adversely  affect   the   value   or
marketability   of  such  Mortgage  Loan  or  related   Mortgaged
Property.  Notwithstanding anything to the contrary contained  in
this  Section,  to the extent that timely repairs  are  presently
being  undertaken utilizing casualty insurance proceeds  pursuant
to  an  insurance claim which is being timely processed with  the
insurance company, such repairs shall not constitute a breach  of
this  warranty  provided, however, that upon completion  of  such
repairs,  the collateral value of the repaired Mortgaged Property
shall  not be diminished materially from its value prior to  such
casualty loss.
               
                     (ii)   There  are (i) no uninsured  casualty
losses  and  (ii)  no  insured casualty losses  relating  to  any
Mortgaged  Property  where coinsurance has been,  or  Seller  has
reason to believe it will be, claimed by the insurance company or
where  the loss, exclusive of contents, is greater than  the  net
recovery  from  the  fire insurance carrier.  Casualty  insurance
proceeds  paid  with respect to a Mortgage Loan  have  been  used
either to reduce the Mortgage Loan balance or for the purpose  of
making  repairs to the Mortgaged Property.  Unless such insurance
proceeds have been used to reduce the Mortgage Loan balance,  all
damage  with  respect to which casualty insurance  proceeds  have
been received by or through Seller has been properly repaired  or
is in the process of being repaired with such proceeds.
               
               (j)  Lien Priority; Title Insurance.
               
               As  required by Applicable Requirements,  a  title
policy,  binding  title commitment or attorney's  opinion  as  to
title,  as  the case may be, has been issued and is currently  in
effect  for each Mortgage Loan insuring that the related Mortgage
is  a  valid first lien on the Mortgaged Property which  has  not
been modified, and that such Mortgaged Property is free and clear
of all encumbrances and liens having priority over the first lien
of  the  Mortgage,  except for liens for real  estate  taxes  and
special  assessments  not  yet due and  payable  and  except  for
easements  and  restrictions of record identified in  such  title
policy and such other matters as are permissible under Applicable
Requirements.
               
               (k)  Condemnation; Forfeiture.
               
               Except  as  disclosed  in Schedule  3.2(k)  hereto
(which  Schedule shall be updated as of the Sale  Date),  to  the
knowledge  of Seller, no Mortgaged Property has been or  will  be
subject  to an action seeking condemnation or forfeiture of  such
Mortgaged Property.
               
               (l)  Custodian Files.
               
               Except as disclosed in Schedule 3.2(l) hereto, the
Custodian File for each Mortgage Loan will contain, upon transfer
of  the  Servicing  Rights to Purchaser, all  items  required  by
applicable Investor regulations for the certification of each and
every  Pool,  and each and every Pool will be in compliance  with
all  applicable Investor requirements and guidelines.  Except for
GNMA  Subserviced Loans that are included in Pools that  are  not
Certified  Pools  and except as otherwise disclosed  in  Schedule
3.2(l) hereto, all Pools have been certified in accordance  with,
and  the  securities backed by such Pools are issued  on  uniform
documents  promulgated in, the applicable Investor guide  without
any  material deviation therefrom.  All Pools shall  be,  on  the
date  of  receipt  of  the applicable Investor  Consent,  finally
certified in accordance with applicable Investor requirements and
procedures and Purchaser shall be under no obligation  to  accept
Pools which have not been so certified.  All Pools shall be, when
transferred to Purchaser on the date of receipt of the applicable
Investor Consent, eligible for recertification by the Purchaser's
custodian  (except,  in  the case of GNMA  Pools  only,  for  the
preparation   and   recording,  if  necessary,   of   appropriate
assignments  of  Mortgages  from Seller  to  Purchaser  and  from
Purchaser  to GNMA), and Seller will be responsible for  cure  of
any  deficiencies necessary for recertification.   The  principal
balances outstanding and owing on the Mortgage Loans in each Pool
equal or exceed the amounts owing to the security holders of each
Pool.   It  is  understood  that any  deficiencies  in  the  Pool
certifications  will be cured at the sole cost and responsibility
of  the  Seller  and in the time frame required under  applicable
Investor guidelines for such cure.
               
               (m)  Exception Loans.
               
               Except  as  disclosed  in Schedule  3.2(m)  hereto
(which  Schedule  shall  be updated as  of  the  Sale  Date),  no
Mortgage  Loan is a VA vendee loan, an FHA Section 235  loan,  an
FHA Section 203(k) loan, an FmHA loan or a GNMA "Targeted Lending
Initiative" (reduced guaranty fee) loan.
               
               (n)  Investor Repurchase and Indemnification.
               
               Except  as  disclosed  in Schedule  3.2(n)  hereto
(which  Schedule  shall  be updated as  of  the  Sale  Date),  no
Mortgage Loan is subject to a pending request relating to  either
repurchase  or  indemnification by an  Investor  or  an  Investor
indemnification.
               
               (o)  Fraud.
               
               To  the knowledge of Seller, no fraudulent action,
error,   omission,  misrepresentation,  negligence,  or   similar
occurrence with respect to a Mortgage Loan has taken place on the
part  of  any person, including without limitation the Mortgagor,
any  appraiser,  any  builder or developer  or  any  other  party
involved in (x) the origination of the Mortgage Loan or  (y)  the
application of any insurance proceeds with respect to a  Mortgage
Loan, Mortgaged Property or REO Property.


                           ARTICLE IV
           REPRESENTATIONS AND WARRANTIES OF PURCHASER
                                
          Section   4.1.     Purchaser's   Representations    and
Warranties.

          Purchaser represents and warrants to Seller as  follows
as  of  the date hereof, the Sale Date and the Servicing Transfer
Date:

               (a)   Organization  and Qualification.   It  is  a
corporation  duly  organized,  validly  existing,  and  in   good
standing,  under the laws of the jurisdiction of  its  formation,
has  the authority and power necessary to own its assets  and  to
transact  the  business  in which it  is  engaged,  and  is  duly
qualified   and  in  good  standing  to  do  business   in   each
jurisdiction  in  which  the  conduct  of  its  business  or  the
ownership of its assets so requires.

               (b)  Authorization; Enforceability; Execution.  It
has  the  absolute and unrestricted right, power, authority,  and
capacity to execute and deliver this Agreement and each Operative
Document,  and, subject to the receipt of all necessary  licenses
and  approvals  in accordance with Section 5.1,  to  perform  its
obligations  hereunder and thereunder.  It has  duly  authorized,
executed,   and  delivered  this  Agreement  and  each  Operative
Document.   This Agreement and each Operative Document constitute
the   legal,   valid,  and  binding  obligation   of   Purchaser,
enforceable against it in accordance with their respective terms,
except  to  the  extent  bankruptcy, insolvency,  reorganization,
fraudulent conveyance, or similar laws affect the enforcement  of
creditors'  rights  generally.   The  signatory  executing   this
Agreement  and  each  Operative Document is  duly  authorized  to
execute and deliver each such document.

               (c)    Non-Contravention.    Its   execution   and
delivery of this Agreement and each Operative Document,  and  the
consummation   and   performance  of  any  of  the   transactions
contemplated  hereby  or thereby, do not  and  will  not:  (i)(A)
violate  any applicable law or any judgment, award, order,  writ,
or  decree  of  any  court or other Governmental  Authority,  (B)
violate  any  Mortgage  Loan  Requirement,  or  (C)  violate  any
provision  of  its certificate of incorporation or by-laws;  (ii)
violate any provision of, or cause a default under, any mortgage,
indenture, contract, agreement, or other undertaking to which  it
is  a party or that purports to be binding upon it or upon any of
its  assets; or (iii) result in the creation or imposition of any
lien on any of its assets.

               (d)   Consents.  Other than the Investor  Consents
and  the licenses, consents and approvals contemplated by Section
5.1,  no  consent  of any other Person (including  such  Person's
general  partners  or  shareholders)  and  no  consent,  license,
approval,  or exemption by, or authorization of, or registration,
filing  or  declaration with, any Governmental Authority  or  any
other  Person,  is  necessary to (i) its execution,  delivery  or
performance of this Agreement or any Operative Document, or  (ii)
the validity or enforceability of this Agreement or any Operative
Document.

               (e)   No-Default.   It is not in default,  and  no
event  or  condition exists that after the giving  of  notice  or
lapse of time or both, would constitute an event of default under
any  material mortgage, indenture, contract, agreement, judgment,
or other undertaking, to which it is a party or which purports to
be binding upon it or upon any of its assets.

               (f)   Approvals.   It is, or as of  the  Servicing
Transfer   Date   will   be,   an   approved   FNMA   and   FHLMC
Seller/Servicer, GNMA Issuer/Servicer, FmHA Servicer, and FHA and
VA  mortgagee  in good standing and has not been suspended  as  a
mortgagee or servicer by any of FNMA, FHLMC, GNMA, FmHA,  FHA  or
the  VA.  It has, or as of the Servicing Transfer Date will have,
all  federal,  state  and  local  licenses,  permits,  and  other
authorizations  of  Governmental  Authorities  required  for  the
conduct  of its business with respect to the Mortgage  Loans  and
the Servicing Rights, including but not limited to state mortgage
banking  licenses in those jurisdictions where such licenses  are
necessary  for  the  conduct of Purchaser's  business  after  the
Servicing Transfer Date.  It knows of no reason why any  Investor
would not consent to the transfer contemplated by this Agreement.

               (g)   Compliance with Law.  Purchaser has complied
in  all material respects with all applicable Laws, the violation
of  which might materially and adversely effect the operations or
financial condition of Purchaser or delay the consummation of the
transactions contemplated hereby.

               (h)   Brokers.   Purchaser has  not  retained  any
broker,  finder,  investment  banker  or  financial  advisor   in
connection  with  this  Agreement  or  any  of  the  transactions
contemplated  hereby  that  would  be  entitled  to  a  broker's,
finder's, investment banker's, financial adviser's or similar fee
in connection therewith.

               (i)  Financial Statements; Solvency.  It meets all
minimum  net worth or similar requirements necessary in order  to
conduct its business which are applicable to Purchaser under  any
law  or  any  requirement of any regulatory agency, Investor,  or
other authority.

               On the Sale Date and each Servicing Transfer Date,
and  after giving effect to each of the transactions contemplated
to  occur on such date, it will not be insolvent and has, or will
have  as  of  such date, adequate net worth to meet all  Investor
requirements.

                            ARTICLE V
                    COVENANTS AND AGREEMENTS
                                
          The  Parties hereby covenant and agree with each  other
as  follows,  each  such covenant and agreement  to  survive  the
applicable Servicing Transfer Date:

          Section 5.1    Licenses and Approvals.

          Purchaser shall use its best efforts from and after the
date  of  this  Agreement  to obtain all  licenses,  permits  and
approvals  from  all  Governmental  Authorities,  Investors   and
Insurers  as may be necessary or appropriate in order  to  enable
Purchaser   or   its  designee  to  consummate  the  transactions
contemplated by this Agreement and service the Mortgage Loans  in
accordance  with all Applicable Requirements from and after  each
Servicing Transfer Date.

          Seller  shall  cooperate  with  Purchaser  and  provide
Purchaser with reasonable assistance, at Purchaser's expense,  as
may  be necessary in order to enable Purchaser to obtain all such
licenses  and  approvals  from Persons  specified  by  Purchaser.
Seller shall not be liable for Purchaser's failure to obtain  any
necessary license or approval.

          Section   5.2     Delivery  of  Custodian   Files   and
Servicing Files.

          With  respect to all Mortgage Loans other than the GNMA
Subserviced  Loans,  on  or  before  each  applicable   Servicing
Transfer  Date, Seller, at Seller's sole cost and expense,  shall
deliver,  or  cause  to  be  delivered, the  applicable  complete
Custodian  Files  to  Purchaser's Document Custodian  by  insured
courier.  Seller shall provide Purchaser with a detailed list  of
all  Custodian Files that have been released by Seller's document
custodian  (other  than  Custodian Files shipped  to  Purchaser's
Document Custodian), indicating the Person to whom such file  has
been  released  and the reason for such release.   Any  Custodian
Files in Seller's possession shall be delivered to Purchaser.

          On  or  before each applicable Advance Settlement Date,
Seller,  at  Seller's sole cost and expense,  shall  deliver  the
applicable  Servicing  Files and any other books,  documents  and
records  relating  to the Servicing Rights and  the  Advances  to
Purchaser by insured courier in accordance with, and by the dates
required by, the Transfer Instructions.

          If  Seller  has  not  delivered all complete  Custodian
Files and Servicing Files to Purchaser's Document Custodian or to
Purchaser,  as  applicable, on or before each Servicing  Transfer
Date, Seller shall use its best efforts to deliver all such files
and  documents to Purchaser's Document Custodian or to Purchaser,
as  applicable,  as  soon  as practicable  after  each  Servicing
Transfer Date.

          Section 5.3    Pool Certification.

          With  respect to all Mortgage Loans other than the GNMA
Subserviced  Loans,  on  or  before  each  applicable   Servicing
Transfer  Date,  the Custodian Files transferred  to  Purchaser's
Document  Custodian  in accordance with the  provisions  of  this
Article  V  shall  contain  all  of  the  documents  (other  than
assignments  of  Mortgage  from  Seller  to  Purchaser  and  from
Purchaser to the Investor) required by the Investor in order  for
Seller's   document  custodian  to  have  finally  certified   or
recertified, as the case may be, all of the transferred Pools and
for  Purchaser's Document Custodian to recertify the  Pools  upon
their  transfer  to  Purchaser after  each  applicable  Servicing
Transfer  Date.   If Purchaser or Purchaser's Document  Custodian
advises Seller that any of the documents received from Seller  or
its custodian is either missing, incomplete or erroneous, Seller,
at  its  sole  cost and expense, shall promptly  clear  any  such
exceptions.  Purchaser shall cause Purchaser's Document Custodian
to  provide Seller with a list of all such exceptions  within  75
days  of receipt of each Custodian File; provided, that any delay
or  failure to provide such notice within such time period  shall
not  affect  any  of Seller's obligations under  this  Agreement,
except  to  the  extent, and only to the  extent,  (i)  that  any
obligation would not have arisen but for such delay or failure or
(ii)  such  delay or failure materially increases the expense  of
Seller's compliance with any obligations under this Agreement (in
which  case  Purchaser  shall pay the  amount  of  the  increased
expense  solely attributable to such delay or failure).   Seller,
at  its sole expense, shall engage a reputable independent third-
party   contractor  acceptable  to  Purchaser  to   prepare   all
endorsements to the applicable Mortgage Notes and assignments  of
the  applicable  Mortgages  from Seller  to  Purchaser  and  from
Purchaser  to  the Investor to the extent required by  Applicable
Requirements  in order to recertify the Pools after the  transfer
contemplated  by  this  Agreement.   All  such  endorsements  and
assignments shall be completed, and in the case of assignments of
mortgages  from  Seller to Purchaser, sent for recording  in  the
applicable  jurisdiction in which the related Mortgaged  Property
is  located,  within the time period required by  the  Applicable
Requirements.   Seller  shall cause such contractor  to  properly
record  each  assignment and provide Purchaser with  a  certified
true   copy   of  each  assignment  sent  for  recording,   which
certification shall be stamped on the face of each assignment and
be  in  form  and  substance satisfactory to Purchaser.   Blanket
assignments   may   be   used  where  permitted   by   applicable
jurisdictions  and  the  Applicable Requirements.   Seller  shall
cause  the  contractor  to forward to Purchaser  (or  Purchaser's
Document  Custodian)  each  recorded  assignment  promptly   upon
receipt  of  such  recorded assignment.  Seller shall  track  the
status   of   the  recordation  process  and  the  clearance   of
exceptions,  shall diligently pursue such items and shall  report
to   Purchaser  on  its  progress  at  least  monthly  until  all
exceptions are cleared and all assignments recorded.

          Section 5.4    Investor Consents.

          Upon  Purchaser's  receipt of all applicable  licenses,
permits and approvals contemplated by Section 5.1, Seller, at its
sole cost and expense, shall prepare and submit all documentation
necessary  and  shall use its best efforts to timely  obtain  the
Investor  Consents  for the transfer of the Servicing  Rights  on
each  Servicing Transfer Date in accordance with this  Agreement.
Seller  shall  provide  Purchaser with a copy  of  each  Investor
Consent promptly after it is received.  Purchaser shall cooperate
with  Seller in connection with obtaining each Investor  Consent,
and  shall  execute  and  deliver  to  Seller  all  documentation
reasonably necessary to obtain each Investor Consent.

          Section 5.5    Notice to Mortgagors.

          In  accordance with all Applicable Requirements, Seller
shall  send to each Mortgagor a letter advising the Mortgagor  of
the  transfer of the applicable servicing rights to Purchaser not
later  than  fifteen (15) days prior to the applicable  Servicing
Transfer  Date,  the form and content of which letters  shall  be
mutually  acceptable to Seller and Purchaser in the  exercise  of
reasonable judgment; provided, that Seller shall not be  required
to  send  any  such  notices  prior to  the  date  on  which  the
applicable Investor Consents shall have been received.  Copies of
all such letters shall be provided to Purchaser.

          Section 5.6    Sale And Transfer Documents.

          Seller  shall,  prior to or on the Sale Date  and  each
Servicing  Transfer Date, execute and deliver,  or  cause  to  be
executed and delivered to Purchaser, the documents or instruments
described in Article VI. Purchaser shall, prior to or on the Sale
Date  and  each Servicing Transfer Date, execute and deliver,  or
cause  to be executed and delivered, to Seller, the documents  or
instruments described in Article VII.

          Section 5.7    Costs and Expenses.

          Seller   shall   bear   all   costs   associated   with
transferring  to  Purchaser the Servicing  Rights,  the  Mortgage
Escrow  Accounts,  the Custodian Files and the  Servicing  Files,
including  without  limitation (i) all fees and  charges  due  to
Investors  with respect to the transfer, (ii) Seller's  custodian
removal fees, including shipping the Custodian Files, (iii) costs
in  connection  with the transfer, preparation and  recording  of
assignments  of the Mortgage Loans from Seller to  Purchaser  and
from  Purchaser  to  Investors, and in providing  Purchaser  with
certified copies thereof, (iv) costs of insured shipping  of  the
Loans  Files  and all other loan documents and servicing  records
related  to the Mortgage Loans to Purchaser's home office  or  to
such  other  location  as  Purchaser may  direct,  (v)  costs  of
preparing Seller's computer tapes in a readable format  with  all
pertinent data necessary to service the Mortgage Loans and  costs
of   delivery  of  such  tapes  to  Purchaser,  (vi)   costs   of
notifications  to  and  requests of  hazard  insurers  to  change
endorsements  on all hazard insurance policies, notifications  to
change  the  mortgagee  of record, and Seller's  notification  to
Mortgagor of the change in servicers, and (vii) costs incurred in
obtaining or correcting documents that were erroneously certified
by  Seller's or Prior Servicer's custodian.  Purchaser shall bear
all   of   its   document  custodian's  costs   associated   with
recertifying the Pools purchased hereunder.

          Except  as specifically provided above or elsewhere  in
this  Agreement,  each Party shall bear the expenses  and  costs,
including  attorney  fees,  it  incurs  in  connection  with  the
preparation   of   this   Agreement  and  consummation   of   the
transactions contemplated by this Agreement.

          Section  5.8     Access to Mortgage  Documents,  Files,
Records, Etc.

          From the Sale Date to the applicable Servicing Transfer
Date,  Purchaser and its attorneys, accountants, consultants  and
other   representatives,  shall  have  reasonable  access,   upon
reasonable  notice  and  during regular business  hours,  to  the
Servicing Files and to Seller's books, records and accounts  with
respect  to  the  Mortgage Loans, the Servicing  Rights  and  the
Advances,  including  but not limited to the  documents  held  by
Seller's  document  custodian.  Seller shall  provide  Purchaser,
within  three (3) Business Days after written request,  with  all
information reasonably requested by Purchaser with respect to the
Mortgage  Loans, the Servicing Rights and the Advances, including
but  not  limited to copies of audits of Seller by any Agency  or
any  other  federal or state regulatory body.  The Parties  agree
that  Purchaser's examination and determination  hereunder  shall
not   evidence  that  Seller  has  complied  with  any   of   its
representations,  warranties  or  covenants  contained  in   this
Agreement.

          Section 5.9    Best Efforts; Further Assurances.

          Subject  to  the terms and conditions herein  provided,
each  of the Parties shall use its best efforts to take, or cause
to  be  taken,  all action, and to do, or cause to be  done,  all
things reasonably necessary, proper or advisable under applicable
laws  and  regulations  to  consummate  and  make  effective  the
transactions contemplated by this Agreement.  Each of Seller  and
Purchaser  will  use  their respective  best  efforts  to  obtain
consents  of all Governmental Authorities, all Investor  Consents
and   third  parties  necessary  to  the  consummation   of   the
transactions contemplated by this Agreement.

          Each  Party hereby covenants and agrees that  it  will,
whenever  and as often as reasonably requested so to  do  by  the
other Party, its successors and assigns, do, execute, acknowledge
and deliver any and all such other and further acts, assignments,
limited powers of attorney, acknowledgments, acceptances and  any
instruments of further assurance, approvals and consents as  such
other   Party,  its  successors  and  assigns,  may   hereinafter
reasonably  deem  necessary or proper in order  to  complete  and
perfect the conveyances to Purchaser contemplated hereby

          Seller  shall  furnish  to  Purchaser  such  powers  of
attorney  and  other  documents as are  reasonably  necessary  or
appropriate  to enable Purchaser to prosecute any  collection  or
foreclosure  proceedings with respect to the  Mortgage  Loans  in
Seller's or any applicable Prior Servicer's name.

          Section 5.10   Hart-Scott-Rodino Filings.

          If  required  by  applicable law, each  of  Seller  and
Purchaser will use their respective best efforts to file with the
Antitrust  Division of the Department of Justice (the  "Antitrust
Division") and the Federal Trade Commission (the "FTC")  promptly
following  the date hereof the notification and report form  (the
"Report")   required   under   the  Hart-Scott-Rodino   Antitrust
Improvements  Act  of  1976, as amended  (the  "HSR  Act"),  with
respect to the transactions contemplated hereby.  Each of  Seller
and  Purchaser shall cooperate with the other party to the extent
necessary  to  assist the other party in the preparation  of  its
Report,  shall  request early termination of the  waiting  period
required by the HSR Act and, if requested, will promptly amend or
furnish  additional information thereunder if  requested  by  the
Antitrust Division and/or the FTC.

                           ARTICLE VI
        CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER
                                
          Section 6.1    Conditions to the Sale Date.

          The   obligations  of  Purchaser  to   consummate   the
transactions contemplated by this Agreement shall be  subject  to
the  fulfillment prior to the Sale Date of each of the  following
conditions:

               (a)   (i)  No Governmental Authority of  competent
jurisdiction   shall  have  (x)  enacted,  issued,   promulgated,
enforced  or  entered  any statute, rule,  regulation,  judgment,
decree,  injunction or other order which is  in  effect;  or  (y)
commenced or threatened any action or proceeding, which in either
case would prohibit consummation of the transactions contemplated
by  this  Agreement,  and  (ii) if the  filings  contemplated  by
Section 5.10 are made by the parties, the waiting period required
by the HSR Act, and any extensions thereof obtained by request or
other action of the FTC and/or the Antitrust Division, shall have
expired or been terminated by the FTC and the Antitrust Division.

               (b)   All  representations and warranties made  by
Seller in this Agreement and the Schedules delivered by Seller to
Purchaser pursuant hereto shall be true, correct and complete  in
all  material respects on the date hereof and as of the Sale Date
as though such representations and warranties were made as of the
Sale  Date, and Seller shall have duly performed or complied with
all  of the covenants, obligations and conditions to be performed
or  complied with by it under the terms of this Agreement  on  or
prior to the Sale Date.

               (c)   All  other  authorizations, consents  (other
than   Investor   Consents   or  the  licenses,   approvals   and
authorizations  contemplated by Section 5.1), waivers,  approvals
or   other  actions  legally  required  in  connection  with  the
execution,  delivery and performance of this  Agreement  and  the
other Operative Documents by the Parties and the consummation  by
the  Parties of the transactions contemplated hereby and  thereby
shall  have been obtained and shall be in full force and  effect;
Seller shall have obtained any authorizations, consents, waivers,
approvals or other actions required to prevent a material  breach
or default by Seller under any contract to which Seller is party.

               (d)   Prior  to or on the Sale Date, Seller  shall
have duly executed and delivered to Purchaser this Agreement, the
other  Operative Documents and such other documents as  shall  be
requested   by   Purchaser  in  form  and  substance   reasonably
acceptable to Purchaser's counsel, including the following:

                    (i)  a certificate of the President or a Vice
President of Seller, dated the Sale Date, to the effect that  (1)
the  person  signing  such  certificate  is  familiar  with  this
Agreement and (2) the conditions specified in Section 6.1(a), (b)
and (c) as they relate to Seller have been satisfied;

                     (ii)   a  certificate of  the  Secretary  or
Assistant  Secretary of Seller, dated the Sale Date,  as  to  the
incumbency of any officer of Seller executing this Agreement, any
other  Operative  Document or any document  related  thereto  and
covering such other matters as Purchaser may reasonably request;

                    (iii)  a certified copy of the resolutions of
the  Board  of Directors of Seller's general partner  authorizing
the  execution, delivery and consummation of this  Agreement  and
the  other  Operative Documents and the transactions contemplated
hereby and thereby;

                     (iv)   an  opinion  of Lowenstein,  Sandler,
Kohl,  Fisher & Boylan, P.A., counsel to Seller, dated  the  Sale
Date, and substantially in the form attached as Exhibit F, and

                     (v)  such other documents or instruments  as
Purchaser   reasonably  requests  to  effect   the   transactions
contemplated hereby.

               (e)   Seller,  Purchaser and First  Bank  National
Association  shall  have entered into an agreement  in  form  and
substance acceptable to the parties providing for the release  of
First Bank's Lien on the Servicing Rights.

               (f)  Seller shall have provided the Purchase Price
Schedule  to  Purchaser at least two Business Days prior  to  the
Sale Date.

               (g)   Purchaser shall have received the  Guaranty,
duly executed and delivered by Harbourton Holdings, L.P.

               
               
                           ARTICLE VII
          CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER
                                
          Section 7.1    Conditions to the Sale Date.

          The   obligations   of   Seller   to   consummate   the
transactions contemplated by this Agreement shall be  subject  to
the  fulfillment  prior to or on the Sale Date  of  each  of  the
following conditions:

               (a)   (i)  No Governmental Authority of  competent
jurisdiction   shall  have  (x)  enacted,  issued,   promulgated,
enforced  or  entered  any statute, rule,  regulation,  judgment,
decree,  injunction or other order which is  in  effect;  or  (y)
commenced or threatened any action or proceeding, which in either
case would prohibit consummation of the transactions contemplated
by  this Agreement[, and (ii) the waiting period required by  the
HSR  Act, and any extensions thereof obtained by request or other
action  of  the  FTC  and/or the Antitrust Division,  shall  have
expired or been terminated by the FTC and the Antitrust Division.

               (b)   All  representations and warranties made  by
Purchaser  in this Agreement shall be true, correct and  complete
in  all  material respects on the date hereof and as of the  Sale
Date  as though such representations and warranties were made  as
of  the  Sale  Date, and Purchaser shall have duly  performed  or
complied with all of the covenants, obligations and conditions to
be  performed  or  complied with by it under the  terms  of  this
Agreement on or prior to the Sale Date.

               (c)    All   authorizations,  consents,   waivers,
approvals  or  other actions legally required in connection  with
the execution, delivery and performance of this Agreement and the
other Operative Documents by the Parties and the consummation  by
the  Parties of the transactions contemplated hereby and  thereby
shall have been obtained and shall be in full force and effect.

               (d)  Prior to or on the Sale Date, Purchaser shall
have  duly  executed and delivered to Seller this  Agreement  and
such other documents as shall be requested by Seller in form  and
substance  reasonably acceptable to Seller's  counsel,  including
the following:

                     (i)   a certificate of an authorized officer
of the Purchaser, dated the Sale Date, to the effect that (1) the
person  signing such certificate is familiar with this  Agreement
and  (2) the conditions specified in Section 7.1(a), (b) and  (c)
as they relate to Purchaser have been satisfied;

                     (ii)   a  certificate of  the  Secretary  or
Assistant Secretary of the Purchaser, dated the Sale Date, to the
effect  that (a) the Purchaser is duly authorized to execute  and
deliver  this Agreement and each of the other Operative Documents
and to perform its obligation hereunder and thereunder and (b) as
to  the incumbency of any officer of the Purchaser executing this
Agreement,  any other Operative Document or any document  related
thereto on behalf of Purchaser and covering such other matters as
Seller may reasonably request;

                    (iii)  Omitted

                     (iv)   an  opinion  of in-house  counsel  to
Purchaser,  dated the Sale Date, and substantially  in  the  form
attached as Exhibit G, and

                     (v)  such other documents or instruments  as
Seller   reasonably   requests   to   effect   the   transactions
contemplated hereby.

               (e)  Seller shall have received from Purchaser the
portion of the Purchase Price due on the Sale Date.

                          ARTICLE VIII
           SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
                   INDEMNIFICATION; REPURCHASE
                                
          Section   8.1      Survival  of   Representations   and
Warranties.

          The representations and warranties provided for in this
Agreement shall survive for five (5) years from the Sale Date for
the benefit of the Parties and their successors and assigns.  The
survival period of each representation or warranty as provided in
this  Section  8.1  is hereinafter referred to as  the  "Survival
Period."   No investigation by Purchaser heretofore or  hereafter
made  shall  modify  or otherwise affect any representations  and
warranties  of  Seller or any of its indemnification  obligations
contained herein.

          Section 8.2    Indemnification by Seller.

          Seller shall indemnify and hold harmless Purchaser, its
Affiliates,   officers,   directors,   employees,   agents    and
representatives,  and any Person claiming by or  through  any  of
them, against and in respect of any and all Losses, together with
interest thereon, calculated at the Fed Funds Rate from the  date
such  Loss  is  incurred to the date Seller  pays  its  indemnity
obligation hereunder, arising out of, resulting from or  incurred
in connection with any of the following events (collectively, the
"Indemnified Events"; individually, an "Indemnified Event"):

               (a)   the inaccuracy of any representation or  the
breach  of any warranty made by Seller in this Agreement  or  any
other  Operative Document, in any agreement entered into  by  the
Parties  in  connection with this Agreement, or in any  Schedule,
Exhibit,  written  statement or certificate furnished  by  Seller
pursuant to this Agreement for the Survival Period, in each  case
determined without regard to any limitations contained therein as
to Seller's knowledge;

               (b)   the  breach  by Seller of  any  covenant  or
agreement to be performed by Seller under this Agreement  or  any
other Operative Document;

               (c)  any litigation pending, threatened or arising
out of events occurring prior to the Sale Date in connection with
the  Mortgage  Loans, the Servicing Rights, the  Mortgage  Escrow
Accounts  or  the Advances, including any litigation, proceedings
or investigations disclosed on any Schedule to this Agreement;

               (d)  any VA No-Bid Mortgage Loan or VA Buydown, in
each case relating to a Mortgage Loan that is one or more payment
past  due  as  of  the Sale Date, for which the VA  notifies  the
Servicer of the related Mortgage Loan within two (2) years  after
the  Sale Date that a Buydown is required to avoid a "no-bid"  by
the  VA; provided that (x) in the case of a such a no-bid notice,
Purchaser and Seller agree to elect the Buydown option, (y) prior
to  claiming indemnification under this paragraph Purchaser shall
use  commercially reasonable efforts to submit to Seller for  its
prompt  review  and approval a calculation of the debt  reduction
required   to  avoid  a  no-bid,  if  the  VA  affords  Purchaser
sufficient   time  thereafter  and  (z)  the  amount  indemnified
hereunder  shall  only include the amount of the  debt  reduction
necessary to avoid a no-bid; and

               (e)   errors  and  omissions  in  the  processing,
originating   or  servicing  any  of  the  Mortgage   Loans,   as
applicable, on the part of Seller or any Prior Servicer prior  to
the applicable Servicing Transfer Date.

          Section 8.3    Indemnification by Purchaser.

          Purchaser shall indemnify and hold harmless Seller, its
Affiliates,   officers,   directors,   employees,   agents    and
representatives,  and any Person claiming by or  through  any  of
them, against and in respect of any and all Losses, together with
interest thereon, calculated at the Fed Funds Rate from the  date
such  Loss  is incurred to the date Purchaser pays its  indemnity
obligation hereunder, arising out of, resulting from or  incurred
in connection with any of the following events (collectively, the
"Indemnified Events"; individually, an "Indemnified Event"):

               (a)   the inaccuracy of any representation or  the
breach of any warranty made by Purchaser in this Agreement or any
other  Operative Document, in any agreement entered into  by  the
Parties  in  connection with this Agreement, or in any  Schedule,
Exhibit,  written statement or certificate furnished by Purchaser
pursuant to this Agreement for the Survival Period, in each  case
determined without regard to any limitations contained therein as
to Purchaser's knowledge;

               (b)   the  breach by Purchaser of any covenant  or
agreement  to  be performed by Purchaser under this Agreement  or
any other Operative Document; or

               (c)   any  failure  by Purchaser  to  service  the
Mortgage  Loans after the applicable Servicing Transfer  Date  in
accordance  with Applicable Requirements, provided that  whenever
such failure arises out of or relates to Seller's indemnification
obligations hereunder, no indemnification is required unless such
failure materially and adversely affects Seller's ability to cure
a  breach, defend a claim or otherwise result in a material  loss
to Seller.

          Section 8.4    Indemnification Procedures.

          In  the  case of any claim for indemnification  arising
hereunder, an Indemnified Party shall give prompt written  notice
to  the Indemnifying Party as and when the same becomes known  to
the   Indemnified  Party  (provided,  that  the  failure  of  the
Indemnified  Party  to  give such notice shall  not  relieve  the
Indemnifying Party of its obligations hereunder unless, and  only
to  the  extent, such failure deprives the Indemnifying Party  of
the  right  to  contest any claim, increases the amount  of  such
claim, or decreases the amount of the claim that could have  been
avoided  had  proper notice been given).  The Indemnifying  Party
shall  have the right to defend and to direct the defense against
any  such  claim  or demand, in its name or in the  name  of  the
Indemnified  Party,  as the case may be, at the  expense  of  the
Indemnifying Party, and with counsel selected by the Indemnifying
Party  and  acceptable to the Indemnified Party unless  (i)  such
claim  or  demand  seeks an order, injunction or other  equitable
relief  against  the Indemnified Party, or (ii)  the  Indemnified
Party  shall  have  reasonably concluded  that  (x)  there  is  a
conflict  of  interest  between the  Indemnified  Party  and  the
Indemnifying Party in the conduct of the defense of such claim or
demand or (y) the Indemnified Party has one or more defenses  not
available  to  the Indemnifying Party.  If the Indemnified  Party
concludes  that  (x)  or (y) above apply, the  Indemnified  Party
shall  provide  prompt written notice to the  Indemnifying  Party
stating   the  reasons  for  such  conclusions.   Notwithstanding
anything in this Agreement to the contrary, the Indemnified Party
shall,  at the expense of the Indemnifying Party, cooperate  with
the  Indemnifying  Party, and keep the Indemnifying  Party  fully
informed,   in  the  defense  of  such  claim  or  demand.    The
Indemnified  Party  shall have the right to  participate  in  the
defense  of any claim or demand with counsel employed at its  own
expense;  provided, however, that, in the case of  any  claim  or
demand  described  in clause (i) or (ii) of the second  preceding
sentence or as to which the Indemnifying Party shall not in  fact
have  employed  counsel to assume the defense of  such  claim  or
demand,  the  reasonable fees and disbursements of  such  counsel
shall  be  at  the  expense  of  the  Indemnifying  Party.    The
Indemnifying Party shall have no indemnification obligations with
respect to any such claim or demand which shall be settled by the
Indemnified  Party  without  the prior  written  consent  of  the
Indemnifying  Party,  which  consent shall  not  be  unreasonably
withheld  or  delayed.  Notwithstanding the  preceding  sentence,
Purchaser  shall have the exclusive right, absent  fraud  or  bad
faith, to settle any claim for less than $10,000 from Purchaser's
own  funds  without  in  any  manner  affecting  its  rights   to
indemnification therefor under this Article VIII.

          Notwithstanding  anything  to  the  contrary  contained
herein,  the  Indemnified Party, without in any manner  affecting
the  indemnity to be provided under this Article VIII, shall have
the  right to assume the defense of any claim and shall have  the
right  to  settle  any claim on a reasonable  basis  without  the
consent  or  involvement  of  the  Indemnifying  Party,  if   the
Indemnified  Party  reasonably believes that such  assumption  or
settlement  is  necessary  to discharge its  responsibilities  as
servicer  of the Mortgage Loans or to preserve its authority  and
approvals to service the Mortgage Loans or to maintain the manner
in  which it conducts its business, if the failure to assume  the
defense  of  or  settle the claim could materially and  adversely
impact upon its relationship with an Investor or Insurer,  or  if
the  Indemnifying  Party  does not, in  the  Indemnified  Party's
reasonable   judgment,   diligently  defend   and/or   cure   any
Indemnified Event.

          Section 8.5    Repurchase.

          If  Seller  is  obligated to indemnify  Purchaser  with
respect to an Indemnified Event under Section 8.2 relating  to  a
Mortgage  Loan,  and  as  a  result  Purchaser  is  required   by
Applicable Requirements to repurchase such Mortgage Loans out  of
the related Pool (or Purchaser would be required or permitted  to
repurchase such Mortgage Loan if it was still in a Pool), then in
addition to the obligations of Seller to indemnify Purchaser  for
any  Losses  arising out of, resulting from or  relating  to  the
Indemnified Event under Section 8.2, Purchaser may require Seller
to  repurchase the Mortgage Loan and the related Servicing Rights
from  the  Investor  and Purchaser, as  the  case  may  be.   The
purchase  price under this Section 8.5 for any Mortgage Loan  and
the  related  Servicing Rights repurchased hereunder shall  equal
the  Repurchase Price, and shall be paid within fifteen (15) days
following receipt from Purchaser of written demand therefor.   In
addition,  Seller  shall  reimburse Purchaser  for  all  Advances
related  to  the  applicable Mortgage Loan repurchased  hereunder
Immediately  upon completion of the purchase or repurchase  of  a
Mortgage  Loan  or  Servicing Rights by Seller,  Purchaser  shall
assign to Seller all of its rights, title and interest in and  to
such Mortgage Loan and the related Servicing Rights and Advances,
and  shall  forward  to  Seller  all  Mortgage  Escrow  Accounts,
Custodian  Files,  Servicing Files, servicing records  and  other
documents relating to such repurchased Mortgage Loan or Servicing
Rights.

                           ARTICLE IX
                           TERMINATION
                                
          Section 9.1    Termination.

          This  Agreement may be terminated at any time prior  to
the Sale Date as follows:

               (a)  by mutual consent of Seller and Purchaser;

               (b)   by either Seller or Purchaser, if the  other
party  hereto  shall breach in any material respect  any  of  its
representations,  warranties  or obligations  contained  in  this
Agreement;

               (c)   by  Purchaser,  if  the  conditions  to  its
obligations  set forth in Article VI have not been  satisfied  or
waived on or before the Sale Date; and

               (d)    by   Seller,  if  the  conditions  to   its
obligations  set forth in Article VII have not been satisfied  or
waived on or before the Sale Date.

          9.2  Effect of Termination.

          If  this  Agreement is terminated pursuant  to  Section
9.1, all rights and obligations of Seller and Purchaser hereunder
shall  terminate  and no Party shall have any  liability  to  the
other  Party,  except as provided in the last  sentence  of  this
paragraph, which shall survive the termination of this Agreement,
and  except nothing herein will relieve any Party from  liability
for  any  breach  of any representation, warranty,  agreement  or
covenant  contained  herein  prior  to  such  termination.   Upon
termination  of  this  Agreement pursuant  to  Section  9.1,  any
portion  of  the  Purchase Price or other  amounts  delivered  by
Purchaser  to  Seller  shall be promptly  returned  to  Purchaser
together with interest at the Fed Funds Rate.

                            ARTICLE X
                    MISCELLANEOUS PROVISIONS
                                
          Section 10.1   Notices.

          All    notices,   consents,   requests,    and    other
communications under this Agreement shall be in writing and shall
be  effective: (a) upon delivery by hand; (b) one day after being
deposited with a recognized overnight delivery service; (c) three
days  after  being  deposited in the United States  mail,  first-
class,  postage prepaid, registered or certified, return  receipt
requested; or (d) if sent by facsimile, upon receipt of  a  clear
transmission  report--in each case addressed  to  such  party  as
follows  (or to such other address as hereafter may be designated
in writing by such Party to the other Party):

     If to Purchaser, addressed to Purchaser at:

          Lehman Capital, A Division of
          Lehman Brothers Holdings Inc.
          3 World Financial Center
          12th Floor
          New York, NY  10285-1200
          Attn: Manager-Contract Finance
          Telecopier No.: 212-528-6659

     If to Seller, addressed to Seller at:

          Harbourton Mortgage Co., L.P.
          2530 South Parker Road
          Suite 500
          Denver, CO 80014
          Attn: Mr. Jack W. Schakett, Chief Executive Officer
          Telecopier No.: 303-745-3688

          and

                    Harbourton Mortgage Co., L. P.
                    601 Fifth Avenue
                    Scottsbluff, NE 69361
                    Attention: Servicing Manager
          Telecopier No.: 308-630-6700

          Section  10.2   Assignment; Successors and Assigns;  No
Third Party Rights.

          This  Agreement shall be binding upon and inure to  the
benefit  of  the  Parties  and their  respective  successors  and
assigns.   This  Agreement shall be for the sole benefit  of  the
Parties  and  their  respective  successors,  assigns  and  legal
representatives and is not intended, nor shall be  construed,  to
give  any  Person,  other than the Parties and  their  respective
successors,  assigns  and  legal representatives,  any  legal  or
equitable right, remedy or claim hereunder.

          Section 10.3   Entire Agreement.

          This  Agreement  and  the  other  Operative  Documents,
including the Schedules and Exhibits attached hereto and thereto,
constitutes  the entire agreement among the Parties with  respect
to  the  matters  covered  hereby  and  supersedes  all  previous
written,  oral or implied understandings among them with  respect
to such matters.

          Section 10.4   Amendment, Modification and Waivers.

          This  Agreement  may  only be amended  or  modified  in
writing  signed  by  the party against whom enforcement  of  such
amendment  or  modification  is sought.   Any  of  the  terms  or
conditions  of this Agreement may be waived at any  time  by  the
party or parties entitled to the benefit thereof, but only  by  a
writing  signed  by the party or parties waiving  such  terms  or
conditions.

          Section 10.5   Severability.

          The  invalidity of any portion hereof shall not  affect
the  validity, force or effect of the remaining portions  hereof.
If it is ever held that any restriction hereunder is too broad to
permit  enforcement  of such restriction to its  fullest  extent,
such   restriction  shall  be  enforced  to  the  maximum  extent
permitted by law.

          Section 10.6   Omitted.

          Section 10.7   Governing Law; Jurisdiction; Service  of
Process.

          THE  PARTIES  HEREBY IRREVOCABLY DECLARE AND  AGREE  AS
FOLLOWS:   This Agreement shall be governed by and  construed  in
accordance with the laws of the State of New York, regardless  of
the conflict of laws principles thereof.  Any legal action, suit,
or  other proceeding arising out of or in any way connected with,
this  Agreement may be brought in the courts of the State of  New
York,  or  in  the United States courts for the District  of  New
York.  With respect to any such proceeding in any such court: (a)
Each  Party generally and unconditionally submits itself and  its
property  to  the nonexclusive jurisdiction of such  court.   (b)
Each  Party waives, to the fullest extent permitted by  law,  any
objection  it  has  or hereafter may have to the  venue  of  such
proceeding,  as  well as any claim it has or may have  that  such
proceeding  is  in an inconvenient forum.  (c)   Process  may  be
served  on a Party anywhere in the world, by the same methods  as
are required for notice under this Agreement.

          Section 10.8   No Waiver.

          Unless  expressly provided to the contrary, the failure
of any Party to insist upon strict performance of any covenant or
obligation  in  this  Agreement shall not be  a  waiver  of  such
Party's  right to demand strict compliance in the  future  or  to
pursue  or  enforce  whatever remedies may be available  to  such
Party  for  any  breach  or default of or  in  such  covenant  or
obligation  (subject to applicable statutes of  limitation).   No
consent  or  waiver, express or implied, to or of any  breach  or
default in the performance of any covenant or obligation in  this
Agreement shall constitute a consent or waiver to or of any other
breach  or  default in the performance of the same or  any  other
covenant or obligation hereunder.

          Section 10.9   Payments by Wire Transfer.

          All  payments  required  to be made  by  wire  transfer
hereunder  shall be made to the Parties as follows,  or  to  such
other location or account as may be designated in writing by  the
Party entitled to payment:

     If payment is to be made to Seller:

                    First Bank National Association
                    Minneapolis, MN
                    ABA Routing No. 0910-0002-2
                    For Credit to A/C:  1902-7206-3180
                              Harbourton Mortgage Co., L.P.
                                          Collateral Account

     If payment is to be made to Purchaser:

               For Custodial Funds

                    [____________________]
                    [____________________]
                    [____________________]
                    [____________________]


               For All Other Transactions
                    Citibank NYC
                    ABA # 021000089
                    Lehman Brothers Holdings Inc.
                    A/C # 40615501
                    REF:  Harbourton Servicing Purchase

          Section 10.10  Reproduction of Documents.

          This  Agreement, each of the other Operative Documents,
and  each other document or instrument executed and delivered  in
connection with the transactions contemplated hereby and thereby,
may  be  reproduced by any photographic, photostatic,  facsimile,
electronic or other similar process.  Any such reproduction shall
be admissible in evidence as the original itself in any judicial,
administrative  or  arbitral  proceeding,  whether  or  not   the
original is in existence and whether or not such reproduction was
made by a Party in the regular course of business.

          Section 10.11  No Strict Construction.

          The  Parties  acknowledge that this Agreement  and  the
other  Operative Documents have been prepared jointly, and  shall
not be strictly construed against either Party.

          Section 10.12  Counterparts.

          This Agreement may be executed in counterparts, each of
which, when so executed and delivered, shall be deemed to  be  an
original  and all of which, taken together, shall constitute  one
and the same agreement.

          
          
              [SIGNATURES APPEAR ON FOLLOWING PAGE]
          IN WITNESS WHEREOF, the Parties hereby duly execute and
deliver this Agreement:

          
          
                              HARBOURTON MORTGAGE CO., L.P.,
                              a Delaware limited partnership
                              
                              By: Harbourton Funding
                              Corporation,
                                   a Delaware corporation,
                                     its general partner
                              
                              
                              
                              By:_______________________
                                   Name:
                                   Title:
                              

                              LEHMAN CAPITAL, A DIVISION OF
                              LEHMAN BROTHERS HOLDINGS INC.,
                              a Delaware corporation,
                              
                              
                              By:_______________________
                                   Name:
                                   Title:
                              

                                               Schedule 3.1(l)(1)
                                
                     MORTGAGE LOAN SCHEDULE


                                               Schedule 3.1(l)(2)
                                
                          POOL SCHEDULE
                                
                                








                                
                                
                                
                                
                                
                       MORTGAGE SERVICING
                   PURCHASE AND SALE AGREEMENT
                                
                                
                             between
                                
                                
                 HARBOURTON MORTGAGE CO., L.P.,
                             Seller
                                
                                
                               and
                                
                                
                                
                  LEHMAN CAPITAL, A DIVISION OF
                 LEHMAN BROTHERS HOLDINGS INC.,
                                
                                
                            Purchaser
                                
                                
                    Dated as of July 31, 1997
                                
                                
          $903 Million Agency Mortgage Servicing Rights
     $240Million FNMA Government Obligation Servicing Rights








                                
                                
                        TABLE OF CONTENTS

                            ARTICLE I
                 DEFINITIONS AND INTERPRETATIONS

Section 1.1                                      Definitions     1
Section 1.2                                  Interpretations     8

                           ARTICLE II
             PURCHASE AND SALE OF SERVICING RIGHTS;
              PURCHASE PRICE; ADDITIONAL COVENANTS

Section 2.1            Purchase and Sale of Servicing Rights     8
Section 2.2                                   Purchase Price     9
Section 2.3                        Payment of Purchase Price     10
Section 2.4                        Reimbursement of Advances     10
Section 2.5                                Interim Servicing     11
Section 2.6                                     Subservicing     11
Section 2.7Mortgage Escrow Accounts; Optional Insurance Payments 12
Section 2.8                                          Closing     12

                           ARTICLE III
            REPRESENTATIONS AND WARRANTIES OF SELLER

Section 3.1          Seller's Representations and Warranties     13
Section 3.2  Mortgage Banking Representations and Warranties     16

                           ARTICLE IV
           REPRESENTATIONS AND WARRANTIES OF PURCHASER

Section 4.1       Purchaser's Representations and Warranties     20

                            ARTICLE V
                    COVENANTS AND AGREEMENTS

Section 5.1                           Licenses and Approvals     21
Section 5.2  Delivery of Custodian Files and Servicing Files     22
Section 5.3                               Pool Certification     22
Section 5.4                                Investor Consents     23
Section 5.5                             Notice to Mortgagors     23
Section 5.6                      Sale and Transfer Documents     23
Section 5.7                               Costs and Expenses     24
Section 5.8Access to Mortgage Documents, Files, Records, Etc.    24
Section 5.9                 Best Efforts; Further Assurances     24
Section 5.10                       Hart-Scott-Rodino Filings.    25

                           ARTICLE VI
        CONDITIONS PRECEDENT TO OBLIGATIONS OF PURCHASER

Section 6.1                      Conditions to the Sale Date     25

                           ARTICLE VII
          CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER

Section 7.1                      Conditions to the Sale Date     27

                          ARTICLE VIII
           SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
                   INDEMNIFICATION; REPURCHASE

Section 8.1       Survival of Representations and Warranties     28
Section 8.2                        Indemnification by Seller     28
Section 8.3                     Indemnification by Purchaser     29
Section 8.4                       Indemnification Procedures     30
Section 8.5                                       Repurchase     31

                           ARTICLE IX
                           TERMINATION

Section 9.1                                      Termination     31
Section 9.2                            Effect of Termination     31

                            ARTICLE X
                    MISCELLANEOUS PROVISIONS

Section 10.1                                         Notices     32
Section 10.2Assignment; Successors and Assigns; No Third Party Rights
33
Section 10.3                                Entire Agreement     33
Section 10.4             Amendment, Modification and Waivers     33
Section 10.5                                    Severability     33
Section 10.6                                         Omitted     33
Section 10.7 Governing Law; Jurisdiction; Service of Process     33
Section 10.8                                       No Waiver     34
Section 10.9                       Payments by Wire Transfer     34
Section 10.10                      Reproduction of Documents     35
Section 10.11                         No Strict Construction     35
Section 10.12                                   Counterparts     35

                            Exhibits

Exhibit A Interim Servicing Agreement
Exhibit B Private Investor Subservicing Agreement
Exhibit C GNMA Subservicing Agreement
Exhibit D Guaranty
Exhibit E Transfer Instructions
Exhibit F Opinion of Seller's Counsel
Exhibit G Opinion of Purchaser's Counsel


                            Schedules

Schedule 2.2(b)     Purchase Price Schedule
Schedule 3.1(g)     Seller's 1996 Audited Financial Statements
Schedule 3.1(j)     Litigation
Schedule 3.1(l)(1)  Mortgage Loan Schedule
               GO Portfolio Mortgage Loans
               B Portfolio Mortgage Loans
Schedule 3.1(l)(2)  Pool Schedule
               Subserviced GNMA Pool Schedule
Schedule 3.1(l)(3)  Servicing Agreement Schedule
Schedule 3.2(k)     Condemnation; Forfeiture
Schedule 3.2(l)     Servicing/Insurance and Certification
Exceptions
Schedule 3.2(m)     Exception Loans
Schedule 3.2(n)     Investor Repurchase and Indemnification