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                                                                  EXHIBIT 10.123

                               SERVICING AGREEMENT

         This Servicing Agreement, dated as of October 20, 1999 by and between
NATIONAL AUTO FINANCE COMPANY, Inc., a Delaware corporation, as Servicer
("Servicer" or "NAFI"), and ATLANTIC COAST FEDERAL CREDIT UNION, a credit union
organized and existing under the laws and regulations of the United States of
America ("Owner"), as owner of the certain receivables related to the sale or
lease of automobiles and/or light trucks (collectively, "Automobiles").

         WHEREAS, Owner is engaged in the business of providing financing, to
finance the purchase or lease of such Automobiles and holds the receivables
arising therefrom ("Receivables").

         WHEREAS, NAFI is engaged in the business of, among other things, making
and extending credit on Automobiles and servicing Receivables arising with
respect thereto, and Owner desires to retain NAFI to provide certain collection
services and NAFI is willing to provide such services pursuant to the terms and
conditions of this Agreement.

         NOW, THEREFORE, in consideration of the premises, the mutual agreements
hereinafter set forth, and other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties intending to be
legally bound, mutually agree with each other as follows:

                                    ARTICLE I

                                   DEFINITIONS

         Affiliate: With respect to any Person, any other Person controlling,
controlled by or under common control with such Person. For purposes of this
definition, "control" means the power to direct the management and/or policies
of a Person, directly or indirectly, whether through ownership of voting
securities, by contract or otherwise.

         Agreement: This Servicing Agreement including any exhibits or schedules
hereto and all amendments hereof and supplements hereto.

         Business Day: A day other than a Saturday, Sunday, or a day on which
the executive offices of Servicer are closed, or any day that commercial banks
or Federal Reserve Banks serving the Owner or the Servicer are closed.

         Certificate of Title: The actual motor vehicle title in question or the
application therefor pending issuance of the actual title.

         Delinquent Obligor: With respect to any Receivable, the Obligor of such
Receivable that is delinquent seven (7) or more days in tendering a Scheduled
Payment.

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         Financed Vehicle: Any Automobile and related personal property,
together with all repairs, warranties, service contracts, and accessions thereto
which secure an Obligor's indebtedness and other obligations under a Receivable.

         Government Authority: With respect to any Person, property or matter,
any federal, state or local governmental or quasi-governmental entity, body,
agency, authority, political subdivision, department, commission,
instrumentality, board, tribunal, administration, court or other authority
having or asserting jurisdiction over such Person, property or matter.

         Law: With respect to any Person, property or matter, any judgment,
order, decree, writ, injunction, award, statute, rule, law, regulation,
published Government Authority or agency interpretation, ordinance, code or
other requirements applicable to such Person, property or matter.

         Liquidated Receivable: Any Receivable which has been (a) charged-off by
Owner, (b) which Financed Vehicle has been sold or otherwise disposed of after
repossession, or (c) paid in full by the Obligor.

         Material Adverse Effect: With respect to a Person or Receivable, shall
mean an event, change or occurrence which, individually, or together with any
other event, change or occurrence, has a material adverse effect on (i) the
financial position, business, or results of operations of such Person and its
subsidiaries or Affiliates, taken as a whole; (ii) the ability of such Person to
perform its obligations under this Agreement or to consummate the other
transactions contemplated by this Agreement; or (iii) the value, enforceability
or marketability of any Receivable or any Financed Vehicle.

         Obligor: With respect to any Receivable, the purchaser, co-purchaser,
lessee, or co-lessee of the related Financed Vehicle or any other Person who
owes or may be liable for payments under such Receivable, whether as a
guarantor, endorser or otherwise.

         Owner: The Person identified on the first page of this Agreement as
Owner of the Receivables to be serviced under this Agreement.

         Person: Any individual, corporation, partnership, joint venture,
limited liability company, limited liability partnership, association,
joint-stock company, trust, unincorporated organization, business association,
group acting in concert or other organization, whether acting as principal or in
any representative capacity or any government or any agency, Government
Authority or political subdivision thereof.

         Permit: Any federal, state, local, and foreign governmental approval,
authorization, certificate, easement, filing, franchise, license, notice,
permit, or right to which any Person is a party or that is or may be binding
upon or inure to the benefit of any Person or its securities, assets, or
business.


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         Receivable: Any retail installment contract, closed-end lease
agreement, security agreement, conditional sales contract, chattel paper and
related promissory note, or any other obligation, evidencing an Obligor's
obligation arising from the bona fide sale or lease of a motor vehicle by a
dealer to such Obligor, and which the Owner shall deliver to Servicer for
servicing pursuant to the terms of this Agreement.

         Receivable File: With respect to any Receivable, the file accessible to
Servicer through electronic transmission from Owner, which file shall contain a
data entry worksheet, "real time" payment history, the Obligor application, the
retail installment sales contract, closed end lease agreement, promissory note
and/or security agreement which relate to the Receivable, and such other
information, documents, instruments, electronic entries and writings as the
Owner shall supply or the Servicer shall reasonably request the Owner to supply.

         Repossession Fee: With respect to any Receivable and subject to all
applicable Laws for the jurisdiction where such Receivable is located, a fee
payable to Servicer by Owner in an amount to which Owner and Servicer shall
agree on a case by case basis per repossession as compensation for Servicer
repossessing and disposing of a Financed Vehicle pursuant to the terms of this
Agreement plus reimbursement of reasonable expenses.

         Scheduled Payment: With respect to any Receivable, the amount indicated
in such Receivable as required to be paid by the Obligor during each calendar
month by the due date specified in such Receivable.

         Servicer: National Auto Finance Company, Inc..

         Servicing Compensation: The Servicing Fee, and the other amounts to
which Servicer is entitled pursuant to Section 3.7 of this Agreement.

         Servicing Fee: With respect to each Receivable (except Receivables in
bankruptcy or repossession) delivered to Servicer at any time during a calendar
month, an amount equal to $29.50 per Receivable per calendar month paid to
Servicer by Owner for servicing such Receivable payable monthly. Such Servicing
Fee shall be subject to adjustment upon mutual agreement of Servicer and Owner.

         Term: The term of this Agreement as set forth in Section 7.1 hereof.

         Termination Fee: A fee set forth in Section 7.1 of this Agreement.

         Initial Termination Fee: A fee set forth in Section 7.1 of this
Agreement.

         Transfer Fee: With respect to each Receivable (delinquent or otherwise)
delivered to Servicer at any time during the calendar month, a one time per
Receivable Transfer Fee equal to $10.00 to cover Servicer's expenses to board a
Receivable onto its electronic information system.


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                                   ARTICLE II

                         REPRESENTATIONS AND WARRANTIES

         SECTION 2.1 REPRESENTATIONS AND WARRANTIES OF SERVICER. Servicer
represents, warrants and covenants to Owner as follows:

         (a) It is a corporation, validly existing and in good standing under
the laws of the State of Delaware and has the requisite corporate power and
authority to own its assets and to transact the business in which it is
currently engaged. It is duly qualified to do business and is in good standing
in each jurisdiction in which the character of the business transacted by it or
properties owned or leased by it requires such qualification and in which the
failure so to qualify would have a Material Adverse Effect;

         (b) It has the corporate power and authority to make, execute, deliver
and perform this Agreement and all of the transactions contemplated herein, and
has taken all necessary corporate action to authorize the execution, delivery
and performance of this Agreement. When executed and delivered, this Agreement
will constitute a legal, valid and binding obligation of Servicer, enforceable
in accordance with its terms, except as enforcement of such terms may be limited
by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally, by general principles of equity and by the possible
unavailability of equitable remedies, indemnity or contribution, and where
against public policy;

         (c) It holds all necessary Permits from all Government Authorities
necessary for conducting its business as it is presently conducted except where
the failure to have such licenses, certificates and Permits would not have a
Material Adverse Effect. It is not required to obtain the consent of any other
party or any Permit from any Governmental Authority in connection with the
execution, delivery, performance, validity or enforceability of this Agreement,
except for such Permits as shall have been obtained or filed by Servicer prior
to the date of this Agreement;

         (d) Servicer's execution, delivery and performance of this Agreement
will not conflict with, or result in a breach of, or constitute a default under:
(i) any provision of any existing Law or regulation or any order or decree of
any court applicable to Servicer or any of its properties, or (ii) any provision
of the Servicer's Articles of Incorporation or Bylaws, or constitute a material
breach of, or result in the creation or imposition of any lien, charge or
encumbrance upon any of its properties pursuant to, any mortgage, indenture,
contract or other agreement to which it is a party or by which it may be bound
and which would have a Material Adverse Effect;

         (e) The collection practices used by Servicer with respect to each
Receivable will be in all material respects in compliance with all applicable
law, prudent and customary in the loan origination and servicing business and in
compliance with Servicer's servicing procedures for similar receivables, loans,
obligations or accounts;


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         (f) No litigation or administrative proceeding of or before any court,
tribunal or Governmental Authority is currently pending, or, to Servicer's
knowledge, threatened, against Servicer or any of its properties that is
reasonably expected to have a Material Adverse Effect or which questions the
validity or enforceability of this Agreement; and

         (g) Servicer's computer and other systems supporting the servicing of
the Receivables will be modified and maintained to operate in a manner such that
at all times, including on and after January 1, 2000, Servicer will possess the
capability of servicing the Receivables in accordance with the terms of this
Agreement.

         SECTION 2.2 REPRESENTATIONS AND WARRANTIES OF OWNER. Owner represents,
warrants and covenants to Servicer as follows:

         (a) It is a credit union, validly existing and in good standing under
the law of the jurisdiction where it is chartered and has the requisite power
and authority to own its assets and to transact the business in which it is
currently engaged. It is duly qualified to do business and is in good standing
in each jurisdiction in which the character of the business transacted by it or
properties owned or leased by it requires such qualification and in which the
failure so to qualify would have a Material Adverse Effect;

         (b) It has the power and authority to make, execute, deliver and
perform this Agreement and all of the transactions contemplated herein, and has
taken all necessary action to authorize the execution, delivery and performance
of this Agreement. When executed and delivered, this Agreement will constitute a
legal, valid and binding obligation of Owner, enforceable in accordance with its
terms, except as enforcement of such terms may be limited by bankruptcy,
insolvency or similar Laws affecting the enforcement of creditors' rights
generally, by general principles of equity and by the possible unavailability of
equitable remedies, indemnity and contribution, and where against public policy;

         (c) It holds all necessary Permits from all Government Authorities
necessary for conducting its business as it is presently conducted except where
the failure to have such Permits would not have a Material Adverse Effect. It is
not required to obtain the consent of any other party or any Permit from any
Governmental Authority in connection with the execution, delivery, performance,
validity or enforceability of this Agreement, except for such Permits as shall
have been obtained or filed by Owner prior to the date of this Agreement;

         (d) Owner's execution, delivery and performance of this Agreement will
not conflict with, or result in a breach of, or constitute a default under: (i)
any provision of any existing Law or regulation or any order or decree of any
court applicable to Owner or any of its properties, or (ii) any provision of the
Owner's Charter or Bylaws, or constitute a material breach of, or result in the
creation or imposition of any lien, charge or encumbrance upon any of its
properties pursuant to, any mortgage, indenture, contract or other agreement to
which it is a party or by which it may be bound and which would have a Material
Adverse Effect;


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         (e) No litigation or administrative proceeding of or before any court,
tribunal or Governmental Authority is currently pending, or, to Owner's
knowledge, threatened, against Owner or any of its properties that is reasonably
expected to have a Material Adverse Effect or which questions the validity or
enforceability of this Agreement;

         (f) All information provided to Servicer by Owner regarding any
Receivable tendered or to be tendered to Servicer for servicing is true and
correct in all material respects;

         (g) All Receivables which Owner seeks to have Servicer service
hereunder will be secured by, or involve the leasing of, an Automobile, will be
duly and validly authorized, executed and delivered by the related Obligor and
will constitute a legal, valid and binding obligation of the related Obligor,
and in which Owner has a valid, perfected and subsisting first priority lien or
security interest;

         (h) All Receivables tendered to Servicer by Owner for servicing will
comply in all respects with all applicable Government Authority Laws and/or
regulations, including but not limited to usury, credit reporting,
truth-in-lending, and provisions of the Laws of the jurisdiction where the
Receivable originated which pertain to the financing and leasing of Automobiles,
and Owner shall be solely responsible therefor. However, Owner makes no such
warranties regarding the compliance of any Receivables with applicable
Government Authority Laws and/or regulations as such Government Authority Laws
and/or regulations relate to any actions taken by Servicer as to any
Receivables.

         SECTION 2.3 BREACH OF REPRESENTATIONS AND WARRANTIES.

         It is understood and agreed that the representations and warranties set
forth in this Article II shall exist until such time as this Agreement is
terminated. Upon discovery by Servicer or Owner, as the case may be, of a breach
of any of the foregoing representations, warranties and covenants, the Person
discovering such breach shall give prompt written notice to the other party. The
breaching party shall cure such breach in all material respects within sixty
(60) days of its discovery or its receipt of notice of breach, or, with the
prior written consent of an officer of the non-breaching party, such longer
period as is specified in such consent.


                                   ARTICLE III

                   ADMINISTRATION AND SERVICING OF RECEIVABLES

         SECTION 3.1 DELIVERY OF DELINQUENT RECEIVABLES

         At any time during each calendar month during the Term of this
Agreement, Owner will refer for servicing its indirect Receivables which have
become seven (7) calendar days delinquent for any Scheduled Payment. Servicer
shall then service such Receivables for the benefit of Owner pursuant to this
Agreement until such Receivables


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(a) become sixty-one (61) calendar days delinquent (b) such Receivables are
liquidated; (c) the Obligor of any such Receivable has died; (d) any of such
Receivables are in litigation, repossession, bankruptcy, or charged-off by
Owner; or (e) this Agreement is terminated as set forth herein. In the event of
the occurrence of (a), (c), and/or (d) of the preceding sentence, any such
Receivables will be referred back to Owner for further action or servicing as
the case may be. Except as otherwise set forth in this Agreement, Owner shall
suspend any and all servicing activities on all Receivables referred to and
serviced by Servicer.

         SECTION 3.2 DUTIES OF SERVICER.

         (a) Servicer, as agent for Owner, shall service, administer and make
collections on the Receivables (i) in accordance with all applicable Law, with
the applicable provisions of the Receivable and (ii) in conformity with
Servicer's Collection Policy; a copy of which is attached hereto as Exhibit A.
Servicer agrees to provide Owner any revisions and replacements to such
Collection Policy within fifteen (15) days after such revisions or replacements
are made by Servicer.

         (b) Servicer's duties shall be limited to collection activities as set
forth in Exhibit A including making collection calls to Delinquent Obligors and
such other services as Servicer and Owner may agree to in writing from time to
time.

         (c) Servicer shall use reasonable efforts to effect collections of
accounts referred to it by Owner. Unless otherwise instructed by Owner, all
collection efforts shall be conducted in Servicer's name and Servicer agrees
that it shall comply with all provisions of the Fair Debt Collection Practices
Act and applicable state statutes.

         SECTION 3.3 COLLECTION AND ALLOCATION OF RECEIVABLE PAYMENTS.

         Consistent with the terms of this Agreement, Servicer shall make
reasonable efforts to timely collect all payments lawfully called for under the
terms and provisions of the Receivables as and when the same shall become due,
and shall follow such collection procedures as it follows with respect to all
comparable Automobile receivables that it services for itself. Payment
acceptance and processing with respect to the Receivables, will be retained
solely by Owner.


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         SECTION 3.4 REALIZATION UPON RECEIVABLES.

         (a) Owner retains the absolute right to manage the repossession of any
Financed Vehicle. At Owner's direction, Financed Vehicles may be referred to
Servicer from time to time for repossession of the Financed Vehicle. In such
event, Servicer shall use all commercially reasonable efforts consistent with
its servicing procedures set forth herein, to lawfully repossess or otherwise
convert the ownership of the Financed Vehicle securing any Receivable as to
which Owner shall have determined eventual payment in full is unlikely, and
where permitted by the express terms of the Receivable and applicable Law.
Servicer shall commence efforts to repossess or otherwise convert the ownership
of a Financed Vehicle; provided, however, that Servicer may elect not to
commence such efforts within such time period if, in good faith and reasonable
judgment, it determines either that such action would violate the terms of the
related Receivable, it would be impracticable to do so or that the proceeds
ultimately recoverable with respect to such Receivable would be increased by
forbearance, in which case, such Receivable shall be referred back to Owner for
further action.

         (b) Owner specifically acknowledges that upon repossession of any
Financed Vehicle, Servicer shall sell all repossessed Financed Vehicles at
auction unless it determines in its good faith and reasonable judgment either
that it would be impractical to do so or that the proceeds ultimately
recoverable with respect to such Receivable would be increased by an alternative
sale procedure. The foregoing shall be subject to the provision that, in any
case in which the Financed Vehicle shall have suffered damage, Servicer shall
not expend funds in connection with the repair or the repossession of such
Financed Vehicle unless it shall determine in its good faith and reasonable
discretion that such repair and/or repossession will increase the net proceeds
ultimately recoverable with respect to such Receivable by an amount greater than
the amount of such expenses. All amounts received upon sale of a Financed
Vehicle shall be remitted directly by Servicer to Owner. If Servicer in good
faith decides not to sell the Financed Vehicle at auction or at private sale or
the Financed Vehicle if offered for auction or sale and not sold, the Owner
shall then give Servicer written instructions with respect to disposing of such
Financed Vehicle.

         (c) If Servicer receives a notice that an Obligor has died or has filed
for relief under the United States Bankruptcy Code, Servicer shall notify Owner
of such death or the filing for relief under the United States Bankruptcy Code
and refer the Receivable back to Owner.

         SECTION 3.5 PHYSICAL DAMAGE INSURANCE; OTHER INSURANCE.

         Servicer shall have no obligation to monitor the maintenance of, or
enforce liability, physical damage, theft, loss or other insurance by any
Obligor with respect to a Financed Vehicle.


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         SECTION 3.6 SERVICING COMPENSATION AND SERVICER EXPENSES.

         (a) As compensation for its collection services hereunder, Servicer
shall bill Owner once each calendar month a servicing fee (the "Servicing Fee")
of $29.50 per Receivable referred to Servicer and for which collection
activities have been initiated during the preceding calendar month (excluding
any Receivables in bankruptcy or repossession). In addition to such Servicing
Fee and subject to Owner's prior written approval, Owner will also pay for any
and all third party expenses related to such collection activities including
charges such as field hits and special investigations.

         (b) In addition, Servicer shall bill Owner a one-time Transfer Fee of
$10.00 per Receivable for Receivables referred to Servicer for servicing for the
preceding calendar month.

         (c) In addition to the Repossession Fee paid to Servicer upon
assignment by Owner of a Receivable for repossession and disposition, Owner
shall be required to pay all reasonable third party expenses related to the
repossession and disposition of a Financed Vehicle.

         (d) Servicer shall tender to Owner a billing statement on the fifteenth
(15th) day of the next succeeding calendar month following the calendar month in
which such fees and expenses accrue. In the event payment of each such billing
statement is not received by Servicer by the first (1st) day of the following
calendar month, Servicer may assess Owner a late fee of two percent (2%) per
month of the gross amount of each such billing statement until paid in full.

         SECTION 3.7 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING
RECEIVABLES.

         The Servicer and the Owner, and their respective representatives shall
be permitted, following reasonable notice to the other and during regular
business hours, to inspect, audit, and make copies of and abstracts from the
other's records regarding any Receivables, Delinquent Obligors or related
Obligors.

         SECTION 3.8 INSURANCE CONTINGENT DISASTER RELIEF PROTECTION.

         Servicer shall maintain, at its own expense, a computer disaster
recovery plan and computer disaster recovery procedures in forms consistent with
industry standards of prudent institutional receivables servicers, including
procedures that address Year 2000 compliance and Year 2000 contingency programs.
No provision of this Section requiring such a plan and such procedures shall
diminish or relieve Servicer from its duties and obligations as set forth in
this Agreement. Upon written request, Servicer shall cause to be delivered to
Owner such plan and such procedures.


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         SECTION 3.9 POSSESSION OF RECEIVABLE FILES.

         Owner shall, upon the execution and delivery of this Agreement, make
accessible by electronic transmission to Servicer copies of documents in each
Receivable File, including "real time" payment histories, the Certificate of
Title, Obligor application, the retail installment sales contract, closed-end
lease agreement, promissory note and/or security agreement. Upon the referral
and initiation of collection activities on each such Receivable, Owner shall
enable Servicer to electronically place a "hold" on any specific Receivable File
to reflect electronically and otherwise that all activity on such account, must
be approved by Servicer before any action is taken, including specifically,
payment acceptance and processing. Servicer's access to such Receivable Files is
for the sole purpose of servicing the related Receivables. In the event any
Receivable is returned to Owner for any reason, Owner shall terminate Servicer's
access to such Receivable File.

                                   ARTICLE IV

                                      OWNER

         SECTION 4.1 LIABILITY OF OWNER.

         Owner shall be liable in accordance herewith only to the extent of the
obligations specifically imposed by this Agreement.

         SECTION 4.2 INDEMNIFICATION OF OWNER.

         Servicer shall indemnify and hold Owner and Owner's officers,
employees, agents, representatives and controlling Persons harmless from and
against any and all losses, claims, damages, liabilities, regulatory or civil
actions, costs or expenses (including any attorneys' fees or other expenses
reasonably incurred by Owner in connection with investigating any claim against
it and defending any action and any amounts paid in settlement or compromise)
that arise out of or are based upon (a) the failure of Servicer, its officers,
employees or agents to conform to the statutes, ordinances and other regulations
and requirements of any Governmental Authority in connection with performance of
this Agreement, (b) the negligence of Servicer, its officers, employees and
agents, (c) any action or inaction of Servicer, its officers, employees and
agents in performing the obligations of Servicer under this Agreement or any
Receivable thereunder, and (d) any breach by Servicer, its officers, employees
or agents of any term, condition, warranty, representation or any other portion
of this Agreement. Notwithstanding anything in this Agreement to the contrary,
Servicer's duties as set forth in this Section shall survive termination of this
Agreement for any reason.



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                                    ARTICLE V

                                    SERVICER

         SECTION 5.1 LIMITATION ON LIABILITY OF SERVICER AND OTHERS.

         Owner, Servicer and any director, officer, employee or agent of Owner
or Servicer may rely in good faith on any document of any kind which, prima
facie, is properly executed and submitted by any appropriate Person respecting
any matters arising hereunder. Servicer shall not be under any obligation to
appear in, prosecute or defend any action, claim or other proceeding (other than
customary collection activities with respect to any Receivable) that in the
Servicer's opinion may involve expense or liability to the Servicer.

         SECTION 5.2 INDEMNIFICATION OF SERVICER.

         Owner shall indemnify and hold Servicer and Servicer's officers,
employees, agents, representatives and controlling Persons harmless from and
against any and all losses, claims, damages, liabilities, regulatory or civil
actions, costs or expenses (including any attorneys' fees or other expenses
reasonably incurred by Servicer in connection with investigating any claim
against it and defending any action and any amounts paid in settlement or
compromise) that arise out of or are based upon (a) the failure of Owner, its
officers, employees or agents to conform to the statutes, ordinances and other
regulations and requirements of any Governmental Authority in connection with
performance of this Agreement, (b) the negligence of Owner, its officers,
employees and agents, (c) any action or inaction of Owner, its officers,
employees and agents in performing the obligations of Owner under this Agreement
or any Receivable thereunder, and (d) any breach by Owner, its officers,
employees or agents of any term, condition, warranty, representation or any
other portion of this Agreement. Notwithstanding anything in this Agreement to
the contrary, Owner's duties as set forth in this Section shall survive
termination of this Agreement for any reason.


                                   ARTICLE VI

                                     DEFAULT

         SECTION 6.1 EVENTS OF DEFAULT. The following events by Servicer or
Owner shall be Events of Default under this Agreement:

         (a) Failure on the part of Servicer or Owner duly to observe or
perform, in any material respect any of the covenants, obligations or agreements
set forth in this Agreement, which failure is not cured within sixty (60) days
after the date on which written notice of such failure, requiring the same to be
remedied, shall have been given to Servicer or Owner, as the case may be, or, if
such failure cannot reasonably be cured within sixty (60) days, such party has
not commenced and diligently pursued the cure of such failure within sixty (60)
days after the date of such notice; or


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         (b) A decree or order of a court or agency or supervisory authority
having jurisdiction for the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against Servicer or Owner and such decree or
order shall have remained in force, undischarged or unstayed for a period of
sixty (60) days; or

         (c) Servicer or Owner shall consent to the appointment of a conservator
or receiver or liquidator in any insolvency, readjustment of debt, marshaling of
assets and liabilities or similar proceedings of or relating to Servicer or
Owner, as the case may be, or of or relating to all or substantially of
Servicer's or Owner's property, as the case may be; or

         (d) Servicer or Owner shall admit in writing its inability to pay its
debts as they become due, file a petition to take advantage of any applicable
insolvency or reorganization statute, make an assignment for the benefit of its
creditors, or voluntarily suspend payment of its obligations; or

         (e) Any representation or warranty of Owner in this Agreement is false,
incorrect or misleading in any material respect, or if any representation or
warranty contained in any reports, documents, certificates or other papers
delivered to Servicer from time to time, is false, incorrect or misleading in
any material respect, and is not cured within sixty (60) days of written notice
thereof to Owner; or

         (f) Any representation or warranty of Servicer in this Agreement is
false, incorrect or misleading in any material respect, or if any representation
or warranty contained in any reports, documents, certificates or other papers
delivered to Owner from time to time is false, incorrect or misleading in any
material respect and is not cured within sixty (60) days of written notice
thereof to Servicer.

         SECTION 6.2 NOTICE OF DEFAULT AND/OR TERMINATION.

         Upon the happening of an Event of Default as provided in Section 6.1
above, the non-defaulting party shall give written notice of such Event of
Default to the defaulting party who shall have sixty (60) days to cure such
default. After the expiration of sixty (60) days from such written notice and if
the default is still not cured, then the non-defaulting party may commence
termination of all the rights and obligations of both parties under this
Agreement in accordance with Section 7.1 of this Agreement; provided that the
party seeking termination shall give sixty (60) days written notice of such
termination.


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                                   ARTICLE VII

                     TERMINATION OF THE SERVICING AGREEMENT

         SECTION 7.1. TERM AND TERMINATION.

         This Agreement shall be effective upon its execution but operative upon
Owner's transmission of any Receivable File(s) to Servicer for servicing
pursuant to this Agreement. Such transmission and acceptance thereof by Servicer
shall be acknowledged by both parties in writing declaring the day on which such
transmission occurs as the operative date (the "Operative Date") of this
Agreement. Owner acknowledges that upon execution of this Agreement, Servicer
will incur considerable expense to prepare an environment into which Receivable
Files will be transmitted for servicing. As a consequence, if Owner fails to
commence transmitting Receivable Files as contemplated by this Agreement within
thirty (30) calendar days after Servicer has declared such environment ready to
accept such Receivable Files, Owner agrees to pay Servicer ten thousand dollars
and no cents ($10,000) in liquidated damages due and payable upon demand.
Payment of such liquidated damages shall be in lieu of Owner's obligations to
pay the Initial Termination Fee or the Termination Fees as defined herein.
Furthermore, upon payment of such liquidated damages, this Agreement shall be
terminated. The Term of this Agreement shall be for an initial period (the
"Initial Period") of one year from the date hereof, renewable by Servicer on
each anniversary of the date hereof (the "Anniversary Date") for an additional
one year such that, if so renewed, the Term of this Agreement shall be extended
one year from each such Anniversary Date. Servicer shall renew this Agreement by
giving written notice to Owner of its desire to renew at least thirty (30) but
no more than forty-five (45) days prior to each Anniversary Date hereof. Upon
each such renewal of the Agreement, the parties hereto shall renegotiate the
Servicing Fee to be assessed by Servicer and paid by Owner for the succeeding
Term of this Agreement. In the event Owner and Servicer cannot agree to the
amount of the Servicing Fee, the Agreement will terminate on the Anniversary
Date. Owner reserves the right to prevent renewal of this Agreement for any
additional one year period by providing Servicer at least sixty (60) days'
written notice prior to any Anniversary Date of Owner's decision not to renew
the Agreement. Notwithstanding any term or provision of this Agreement to the
contrary, the Term of this Agreement shall be terminated upon the happening of
any of the following events: (a) at the election of Owner during the Initial
Term hereof, after (180 days after date of Agreement) and upon giving Servicer
sixty (60) days written notice pursuant to Section 8.5 hereof and remitting a
Initial Termination Fee to Service equal to one calendar month's average
servicing billing; (b) collection by Servicer and liquidation with respect to
the last Receivable serviced by Servicer; (c) the mutual written consent of
Servicer and Owner; or (d) Servicer or Owner has an uncured Default under
Article VI hereof, and the non-defaulting party has given the defaulting party
notice of termination as provided in Article VI. In the event Owner, without
cause, including during the Initial Period hereof, terminates this Agreement
prior to the liquidation of all or substantially all Receivables serviced
hereunder, then Owner agrees to pay as a termination fee ("Termination Fee") an
amount equal to twice one calendar month's average billing.


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<PAGE>   14


                                  ARTICLE VIII

                            MISCELLANEOUS PROVISIONS

         SECTION 8.1 SEVERABILITY OF PROVISIONS.

         Any provision of this Agreement which is prohibited or which is held to
be void or unenforceable shall be ineffective to the extent of such prohibition
or unenforceability without invalidating the remaining provisions hereof. Any
provision of this Agreement which is prohibited or unenforceable or is held to
be void or unenforceable in any jurisdiction shall be ineffective, as to such
jurisdiction, only to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction as to any provision shall not invalidate or
render unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable Law, the parties hereto waive any provision of Law which
prohibits or renders void or unenforceable any provision hereof.

         SECTION 8.2 AMENDMENT.

         This Agreement may be amended from time to time only by a writing
signed by the Servicer and the Owner.

         SECTION 8.3 DURATION OF AGREEMENT.

         This Agreement shall continue in existence and effect until terminated
as herein provided.

         SECTION 8.4 GOVERNING LAW.

         This Agreement shall be governed by and construed in accordance with
the laws of the State of Florida, without regard to the conflicts of laws or
choice of laws rules, and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.

         SECTION 8.5 NOTICES.

         Any notice, request, demand or other communication shall be
sufficiently given if in writing and delivered in person or transmitted by
telecopier (confirmed by reliable overnight delivery service guaranteeing
delivery by 10:30 A.M. on the next Business Day) or mailed by registered or
certified mail, postage prepaid, return receipt requested, or sent by reliable
overnight delivery service, addressed as follows:


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<PAGE>   15


         If to Servicer:            National Auto Finance Company, Inc.
                                    10302 Deerwood Park Blvd., Suite 100
                                    Jacksonville, FL  32256
                                    Attention:  Peter Benes
                                    Telephone Number:  904/996-2579
                                    Fax Number: 904/996-2541

         If to Owner:               Atlantic Coast Federal Credit Union
                                    505 Haines Avenue
                                    Waycross, GA  31501
                                    Attention:  Karen Stewart
                                    Telephone Number:  _____________
                                    Fax Number:  __________________

         SECTION 8.6 COUNTERPARTS.

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

         SECTION 8.7 WAIVERS.

         No term or provision of this Agreement may be waived or modified unless
such waiver or modification is in writing and signed by the party against whom
such waiver or modification is sought to be enforced.

         SECTION 8.8 EXHIBITS.

         The schedules and exhibits to this Agreement, as amended and in effect
from the time of such amendment until subsequent amendment thereto, if any, are
hereby incorporated and made a part hereof and are an integral part of this
Agreement.

         SECTION 8.9 GENERAL INTERPRETIVE PRINCIPLES.

         For purposes of this Agreement, except as otherwise expressly provided
or unless the context otherwise requires:

         (a) the terms defined in this Agreement have the meanings assigned to
them in this Agreement and include the plural as well as the singular, and the
use of any gender herein shall be deemed to include the other gender;

         (b) references herein to "Articles," and "Sections" and other
subdivisions without reference to a document are to designated Articles and
Sections and other subdivisions of this Agreement;


                                       15
<PAGE>   16

         (c) the words "herein," "hereof," "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
provision;

         (d) the term "include" or "including" shall mean without limitation by
reason of enumeration; and

         (e) the cover page, headings and subheadings hereof have been provided
for convenience of reference only and are not intended to and shall not, affect
the construction or interpretation of this Agreement.

         SECTION 8.10 ASSIGNMENT.

         This Agreement shall not be assigned by the Servicer without the prior
written consent of the Owner, which consent shall not be unreasonably withheld,
except as otherwise provided herein. Upon assignment by Owner of the
Receivables, all of Servicer's obligations herein shall remain in full force and
effect and such assignee shall succeed to all of the rights and obligations of
the Owner hereunder with the same force and effect as if said assignee had been
a party hereto and had executed the same in place of Owner.

         SECTION 8.11 CONFIDENTIALITY AND NONSOLICITATION.

         (a) Servicer hereby agrees with Owner and confirms that the names of
the applicants for, Delinquent Obligors or Obligors under, any of the
Receivables, and any financial information, documentation of the Receivables,
terms, conditions and pricing of the proposed Receivables and underwriting
procedures and all other data, information or documentation which has been
disclosed to, or obtained by the Servicer with respect to this Agreement and, as
may hereafter be disclosed to, or obtained by the Servicer constitute valuable,
confidential, proprietary information belonging solely to the Owner. Herein all
such information is called "Confidential Information". "Confidential
Information" shall exclude any information which was in Servicer's possession
prior to its disclosure or release by or on behalf of Owner to Servicer, is
generally available to the public, or is known to the public or becomes known to
the public through no fault of the Servicer or is disclosed in accordance with
an order of a court or other authority, or which consists of forms not
proprietary to the Owner, such as any forms of any Governmental Authority. Owner
specifically consents to Servicer issuing a press release announcing the
establishment of this and any other business relationship between the parties
hereto.

         (b) Servicer shall, and shall cause its employees, agents, accountants,
counsel, service bureaus, independent contractors, representatives and other
Persons performing services for it, to keep strictly confidential all such
Confidential Information and to use such Confidential Information solely in
furtherance of performing its obligations under this Agreement, shall not
disclose or use, and shall use all reasonable efforts to cause its employees,
agents, accountants, counsel, service bureaus, independent contractors,
representatives and others performing services for it not to disclose or use,
directly or


                                       16
<PAGE>   17


indirectly, such Confidential Information for any other purpose or with any
other investment banker, applicant Delinquent Obligors or Obligor or other
Person, except to the extent expressly permitted hereunder. Servicer shall not
use and shall not disclose to and shall prevent the use by others of any
Confidential Information supplied under this Agreement to: (i) offer or supply
the services to be provided by Owner and/or its Affiliates and contractors in
connection with originating, funding, selling, securitizing or otherwise in
connection with financing competitive with the Receivables, or to solicit, or to
otherwise solicit any business of any Obligor or applicants for the Receivables
with respect to any similar services or receivables similar to, a substitute
for, or competitive with the Receivables, without Owner's express prior written
consent. The immediately foregoing sentence is not intended to, and shall not,
restrict Servicer's provision of services to other Persons without disclosure or
use by Servicer or any such other Person of any Confidential Information.

         (c) Servicer, the Servicer's Affiliates and controlling Persons,
together with any Persons with which the Servicer or such Persons may have a
relationship with respect to financing of the type represented by the
Receivables shall also keep strictly confidential the names, addresses and all
other information, financial or otherwise, of the Delinquent Obligors, Obligors
or applicants of the Receivables which have been disclosed to, or which may come
to the attention of Servicer in connection with the performance of this
Agreement and Servicer shall not use or disclose, and shall take all reasonable
measures to prevent any of its employees, officers, directors, agents,
Affiliates, controlling Persons, or other representatives to use or disclose,
and shall prevent all other Persons from using or disclosing such information
for any purpose except in furtherance of the functions to be performed by the
Servicer pursuant to this Agreement.

         (d) In addition, Servicer shall not solicit any Obligors or applicants
for Receivables for any financing similar to, a substitute for or competitive
with other business of any such applicant, Delinquent Obligors or Obligor or
after the termination of this Agreement, use any list, other data or documents
related to or provided by Owner that is Confidential Information, including, any
underwriting procedures, or other Confidential Information utilized or obtained
in connection with the Receivables to solicit the applicants or Obligors of the
Receivables or other customers of Owner or its Affiliates.

         (e) Servicer may hereafter disclose any Confidential Information
received by it to its directors, officers, and financial and legal advisers and
any independent contractors and service bureaus solely for the purpose of, and
then only as reasonably necessary in connection with, and in furtherance of, the
performance of its functions as Servicer thereunder; provided that the Servicer,
prior to any such disclosure, informs all such Persons of the confidential
nature of such Confidential Information and of the terms of this provision prior
to the delivery of any such information and that by receiving such information,
such Persons agree to be bound by this provision. Servicer shall not, and shall
cause its directors, officers, employees, agents, independent contractors,
service bureaus, advisors, representatives and controlling Persons not to make
any disclosure or

                                       17
<PAGE>   18


improper use of Confidential Information, unless advised by counsel that such
disclosure is required under applicable Law.

         (f) Servicer understands that all Confidential Information is and shall
continue hereunder to be the exclusive and sole property of Owner, and that
neither this Section nor the furnishing of any information hereunder shall
prevent or limit Owner from disclosing such information to other Persons for any
purpose, including, soliciting the services of other potential servicers. In the
event this Agreement is terminated or a successor servicer is appointed
hereunder, Servicer will return to Owner, or at the request of Owner, the
successor servicer, all copies of all Confidential Information, whether in
written, electronic, magnetic or other form.

         (g) The provisions of this Section 8.11 shall survive and continue in
full force and effect after the termination of this Agreement.

         SECTION 8.12 SUCCESSORS AND ASSIGNS.

         This Agreement shall bind and inure to the benefit of and be
enforceable by the Owner and the Servicer and their respective permitted
successors and assigns. Nothing herein shall prevent the Owner or the Servicer
from assigning, as collateral security, their respective rights hereunder.

         SECTION 8.13 LEGAL ACTION.

         If legal action is necessary to enforce this Agreement or collect any
amounts owing under this Agreement, the prevailing party has the right, subject
to applicable law, to payment by the other party of all attorney's fees and
costs, including fees on any appeal and any post-judgment actions.


         SECTION 8.14 ENTIRE AGREEMENT.

         This Agreement constitutes the entire agreement and understanding of
the Owner and the Servicer with respect to the subject matter.

         SECTION 8.15 NO THIRD PARTY BENEFICIARIES.

         This Agreement is not intended, and shall not be construed to, confer
any rights upon any shareholder, creditor, partner or joint venturer of the
Servicer, the Owner or any other Person, whether as third party beneficiaries or
otherwise, against any party hereto or their respective directors, officers,
agents, employees, representatives, Affiliates or controlling Persons. Servicer
and Owner acknowledge and agree that they are contracting with each other on an
arm's-length basis, and this Agreement is not intended to create, and shall not
create, or constitute the parties hereto as partners or joint venturers.


                                       18
<PAGE>   19


         IN WITNESS WHEREOF, Servicer and Owner have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized as of the
day and year first above written.

                        SERVICER

                                 NATIONAL AUTO FINANCE COMPANY, INC.,
                                 as Servicer

                              By: /s/ WILLIAM B. MAGRO
                                  ----------------------------------------------
                                  Name:  William B. Magro

                                 Title: President and Chief Operating Officer


                        OWNER

                              ATLANTIC COAST FEDERAL CREDIT UNION,
                              as Owner

                              By: /s/ ROBERT J. LARISON, JR.
                                  ----------------------------------------------
                                  Name:  Robert J. Larison, Jr.
                                         ---------------------------------------
                                  Title: President
                                         ---------------------------------------


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