SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


                                    FORM 10-K

[X]      Annual  report  pursuant  to  Section  13 or  15(d)  of the Securities
         Exchange Act of 1934 for the period from June 24, 1997 (Commencement
         of Operations) to December 31, 1997

[  ]     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  333-04127-04 

                       Saxon Asset Securities Trust 1997-2
             Mortgage Loan Asset Backed Certificates, Series 1997-2

             (Exact name of registrant as specified in its charter)

         Virginia                                              52-1785164
(State or other jurisdiction of                           I.R.S. Employer
incorporation or organization)                            Identification No.)

                    4880 Cox Road, Glen Allen, Virginia 23060
               (Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code : (804) 967-7400

Securities registered pursuant to Section 12(b) of the Act:  None
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

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 
405 of Regulation  S-K is not contained herein,  and will not be  contained,
to the best of  registrant's  knowledge,  in definitive  proxy or  information
statements incorporated by reference in Part III of this Form 10-K or any
 amendment to this Form 10-K.  [X]

Documents incorporated by reference:  None

              Page 1 of 5                          This report consists of 17
                                                consecutively numbered pages.


<PAGE>

SAXON ASSET SECURITIES TRUST 1997-2


TABLE OF
CONTENTS
                                                                    Page
PART I
Item  1. Business.....................................................3

Item  2. Properties...................................................3

Item  3. Legal Proceedings............................................3

Item  4. Submission of Matters to a Vote of Security Holders..........3

PART II
Item  5. Market for Registrant's Common Equity and 
              Related Stockholder Matters.............................3

Item  6. Selected Financial Data......................................3

Item  7. Management's Discussion and Analysis of 
           Financial Condition and Results of Operations..............3

Item  8. Financial Statements and Supplementary Data..................3

Item  9. Changes in and Disagreements with Accountants
                 on Accounting and Financial Disclosure...............3

PART III
Item 10. Directors and Executive Officers of the Registrant...........4

Item 11. Executive Compensation.......................................4

Item 12. Security Ownership of Certain Beneficial Owners
                    and Management....................................4

Item 13. Certain Relationships and Related Transactions...............4

PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports
                         on Form 8-K..................................4

SIGNATURE.............................................................5

Supplemental Information to be Furnished with Reports Filed Pursuant to Section
15(d) of the Act by Registrants Which Have Not Registered Securities Pursuant to
Section 12 of the Act...... ..........................................6

INDEX TO EXHIBITS........... .........................................7

                                      -2-
<PAGE>

This Annual Report on Form 10-K is filed in accordance with a letter dated March
13, 1997 sent to the Office of Chief Counsel,  Division of Corporate  Finance of
the Securities and Exchange  Commission (the  "Commission")  requesting that the
Commission  enter an order pursuant to Section 12(h) of the Securities  Exchange
Act of 1934 (the  "Exchange  Act"),  granting  exemption  for the Trust from the
reporting  requirements  of Section 13 and 15(d), or issue a no action letter to
like effect.  Accordingly,  responses to certain Items have been omitted from or
modified in this Annual Report on Form 10-K.


PART I

Item 1.  Business

Omitted.

Item 2.  Properties

Omitted.

Item 3.  Legal Proceedings

The Registrant is not aware of any material legal  proceeding  with respect to,
the Company, the Master Servicer or the Trustee, as related to the Trust.

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

No  matter  was  submitted  to a vote  or  consent  of  Holders  of the  Offered
Certificates during the fiscal year covered by this report.


PART II

Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters

The Trust does not issue stock.

As of  January  2,  1998,  the  number  of  holders  of each  Class  of  Offered
Certificates was as follows:

     Class AF-1      2
     Class AF-2      1
     Class AF-3      8
     Class AF-4      3
     Class AF-5      13
     Class AF-6      1
     Class AF-7      1
     Class MF-1      1
     Class MF-2      4
     Class BF        4
     Class AV-1      7
     Class MV-1      4
     Class MV-2      1
     Class BV        1

Item 6.  Selected Financial Data

Omitted.

Item 7.  Management's Discussion and Analysis of Financial condition and
         Results of Operations

Omitted.

Item 8.  Financial Statements and Supplementary Data

Omitted.

Item 9.  Changes in and Disagreements with Accountants on Accounting and 
         Financial Disclosure

There was no change of  accountants  or  disagreement  with  accountants  on any
matter of accounting principles or practices or financial disclosure.

                                      -3-
<PAGE>
PART III

Item 10. Directors and Executive Officers of the Registrant
Omitted.

Item 11. Executive Compensation
Omitted.

Item 12. Security Ownership of Certain Beneficial Owners and Management

The following  entities own more than 5% of the specified Class of Certificates.
These  positions  are held  through the  Depository  Trust  Company.  The Master
Servicer  has not been  advised that any such DTC  participants  are  beneficial
owners.

Class AF-1     Chase Manhattan Bank
               Merrill Lynch Pierce Fenner & Smith
Class AF-2     Chase Manhattan Bank/Chemical
Class AF-3     Boston Safe Deposit & Trust
               Chase Manhattan Bank/Chemical
               SSB-Custodian
               Wachovia Bank, N.A.
Class AF-4     Merrill Lynch Pierce Fenner & Smith
               SSB-Custodian
               UBM Bank, N.A.
Class AF-5     Bankers Trust
               Citibank, N.A.
               NationsBank of Texas, N.A.
               Northern Trust Company
               Prudential Securities, Inc.
               Texas Commerce Bank
Class AF-6     Merrill Lynch Pierce Fenner & Smith-Deb Sec
Class AF-7     National City Bank
Class MF-1     Merrill Lynch Pierce Fenner & Smith-Deb Sec
Class MF-2     Bank of New York (The)
               Morgan Keegan & Co., Inc.
               Trustmark National Bank
Class BF       Bankers Trust Company
               Merrill Lynch Pierce Fenner & Smith-Deb Sec
               Wachovia Bank, N.A.
Class AV-1     Chase Manhattan Bank
               Citibank, N.A.
               Merrill Lynch Pierce Fenner & Smith-Deb Sec
               Swiss Bank Corporation-New York Branch
Class MV-1     Boston Safe Deposit & Trust Co.
               Chase Manhattan Bank
               PNC Bank, N.A.
               Wachovia Bank, N.A.
Class MV-2     Bankers Trust Company
Class BV       Merrill Lynch Pierce Fenner & Smith-Deb Sec
               

Item 13. Certain Relationships and Related Transactions

No reportable transactions have occurred.


PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a) The following documents are filed as part of this report:

    (1) Financial Statements:
         Omitted.

    (2)  Financial Statement Schedules:
         Omitted.

    (3)  Exhibits:

   Annual Master Servicer Statement of Compliance, filed as Exhibit 99.1 hereto.
   Annual  Servicer  Statement of  Compliance,  filed as Exhibit 99.2 hereto.
   Annual Compilation of Selected Financial Information, filed as Exhibit 99.3 
           hereto.
   Annual Statement of  Independent  Accountants  for each Servicer,
           filed as Exhibit 99.4 hereto.

(b) Reports on Form 8-K: The  following  Current  Reports on Form 8-K were 
    filed by the  Registrant  during the last quarter of 1997.

      Current Reports on Form 8-K, dated  September 25, 1997,  October 27, 1997
      and  November  25,  1997 were filed for the  purpose of filing the Monthly
      Statement  sent to the Holders of the Offered  Certificates  for  payments
      made on the same dates.  The items  reported in such  Current  Report were
      Item 5 (Other Events).

(c) Exhibits to this report are listed in Item (14)(a)(3) above.

                                      -4-
<PAGE>


SIGNATURE

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.

                                       Saxon Asset Securities Trust 1997-2
                                       Mortgage Loan Asset Backed Certificates
                                       1997-2


Date:  March 31, 1998           By:   /s/ Bradley D. Adams
                                      ---------------
                                      Bradley D. Adams
                                      Vice President


                                      -5-
<PAGE>


SUPPLEMENTAL  INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(D) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO
SECTION 12 OF THE ACT.

The  registrant  has not sent an annual report or proxy material to its security
holders.  The registrant  will not be sending an annual report or proxy material
to its security holders subsequent to the filing of this form.

                                      -6-
<PAGE>


INDEX TO EXHIBITS


Exhibit
Number                     Description of Exhibits                     Page


 99.1       Annual Statement of Compliance                               8

 99.2       Annual Servicing Reports                                    10

 99.3       Annual Compilation of Selected Financial
                    Information                                         13

 99.4       Annual Statement of Independent Accountants' for Each
               Servicer                                                 15


                                      -7-

<PAGE>

                                  EXHIBIT 99.1

                         ANNUAL STATEMENT OF COMPLIANCE

                                      -8-
<PAGE>

                         ANNUAL STATEMENT OF COMPLIANCE

     In accordance  with the letter dated March 13, 1997 sent to the  Securities
and Exchange Commission requesting an exception from SEC reporting requirements,
the  Trust  is to  include  as an  exhibit  a copy of the  Annual  Statement  of
Compliance required under the Trust Agreement dated June 1, 1997. The Statement
of compliance  states that the Master  Servicer has received the annual  audited
financial statements of each servicer. Since the financial statements for one of
the  servicers  will not be  received  until after  March 31,  1997,  the Annual
Statement of  Compliance  cannot be filed by Master  Servicer by the 10-K filing
deadline.  Accordingly the Annual statement of Compliance will be filed with the
amended 10-K when the financial statements have been received.


                                      -9-
<PAGE>

                                  EXHIBIT 99.2


                            ANNUAL SERVICING REPORTS


                                      -10-
<PAGE>

                            CERTIFICATE OF COMPLIANCE


Dear Master Servicer:

The undersigned Officer Certifies the following for the 1997 fiscal year:

(a) I have reviewed the  activities and  performance of the Servicer  during the
preceding  fiscal  year  under  the  terms  of the  Servicing  Agreement,  Trust
Agreement,  Pooling and Servicing Agreement and/or  Seller/Servicer guide and to
the best of these  Officers'  knowledge,  the Servicer has  fulfilled all of its
duties,  responsibilities or obligations under these Agreements  throughout such
year,  or if there has been a default or failure of the  servicer to perform any
of such duties, responsibilities or obligations a description of each default or
failure and the nature and status thereof has been reported to First  Nationwide
Mortgage;

(b) I have confirmed that the Servicers is currently an approved FNMA or FHLMC
servicer in good standing:

(c) I have confirmed that the Fidelity Bond, the Errors and Omissions  Insurance
Policy and any other bonds required under the terms of the Servicing  Agreement,
Trust Agreement,  Pooling and Servicing Agreement and/or  Seller/Servicer  Guide
are in full force and effect;

(d) All premiums for each Hazard  Insurance  Policy,  Flood Insurance Policy (if
applicable) and Primary Mortgage Insurance Policy (if applicable),  with respect
to each Mortgaged Property,  have been paid and that all such insurance policies
are in full force and effect;

(e) All real  estate  taxes,  governmental  assessments  and any other  expenses
accrued and due, that if not paid could result in a lien or  encumbrance  on any
Mortgaged  Property,  have been paid,  or if any such costs or expenses have not
been paid with respect to any Mortgaged Property, the reason for the non-payment
has been reported.

(f) All Custodial Accounts have been reconciled and are properly funded: and

(g) All annual  reports of  Foreclosure  and  Abandonment  of Mortgage  Property
required per section 6050j and 6050p of the Internal Revenue Code,  respectively
have been prepared and filed.

Certified by:

/s/  Lynnette Anderson
----------------------
Lynnette Anderson
Vice President Investor Accounting
and Compliance

March 25, 1998


                                      -11-
<PAGE>


     In accordance  with the letter dated March 13, 1997 sent to the Securities
and Exchange Commission requesting an exception from SEC reporting requirements,
the Trust is to include as an exhibit a copy of the annual compliance  statement
of each  Servicer.  Such  statement  has not yet been  received for  Ameriquest.
Accordingly,  the annual compliance  statement for Ameriquest will be filed with
an amended 10-K when such statement is received.


                                      -12-


<PAGE>




                                  EXHIBIT 99.3

              ANNUAL COMPILATION OF SELECTED FINANCIAL INFORMATION



                                      -13-

<PAGE>
============================
Saxon Asset Securities
Trust 1997-2
============================
Annual Compilation of Selected Financial Information

(1)   1997 annual distribution with respect to the holder's Certificates
      based on original principal amount of $1,000
<TABLE>
<S>     <C>    <C>    <C>    <C>    <C>    <C>
(1)   1997 annual distribution with respect to the holder's Certificates
       based on original principal amount of $1,000

                                   Principal       Interest          Total         original

    Total       Class AF-1        2,358,439.61      386,550.93    2,744,990.54    15000000
                Class AF-2                0.00      328,500.00      328,500.00    10000000
                Class AF-3                0.00    1,027,650.00    1,027,650.00    31000000
                Class AF-4                0.00      306,000.00      306,000.00     9000000
                Class AF-5                0.00      565,200.00      565,200.00    16000000
                Class AF-6                0.00      364,249.98      364,249.98    10000000
                Class AF-7                0.00      544,320.00      544,320.00    15552000
                Class MF-1                0.00       75,292.26       75,292.26     2090000
                Class MF-2                0.00      266,254.08      266,254.08     7167000
                Class BF                  0.00      140,164.44      140,164.44     3643000
                Class AV-1       13,239,845.81    8,302,970.54   21,542,816.35   293561000
                Class MV-1                0.00      429,186.80      429,186.80    13896000
                Class MV-2                0.00      860,620.34      860,620.34    26924000
                Class BV                  0.00      443,886.71      443,886.71    13028000

    Per $1,000   Class AF-1          157.2293         25.7701        182.9994
                 Class AF-2            0.0000         32.8500         32.8500
                 Class AF-3            0.0000         33.1500         33.1500
                 Class AF-4            0.0000         34.0000         34.0000
                 Class AF-5            0.0000         35.3250         35.3250
                 Class AF-6            0.0000         36.4250         36.4250
                 Class AF-7            0.0000         35.0000         35.0000
                 Class MF-1            0.0000         36.0250         36.0250
                 Class MF-2            0.0000         37.1500         37.1500
                 Class BF              0.0000         38.4750         38.4750
                 Class AV-1           45.1008         28.2836         73.3845
                 Class MV-1            0.0000         30.8856         30.8856
                 Class MV-2            0.0000         31.9648         31.9648
                 Class BV              0.0000         34.0717         34.0717

                                                                   Group I        Group II
(2)  Prepayments                                                  7,708,892.38   46,170,462.29
       Extra Principal Distribution Amount                        1,612,178.68    5,552,650.27

(3)  Distributions less than the Required Distribution Amount           -               -

(4)  Insured Payment                                                    -               -

(5)  Certificate principal Balance @12/31/97

               Class AF-1             5,142,220.66
               Class AF-2            10,000,000.00
               Class AF-3            31,000,000.00
               Class AF-4             9,000,000.00
               Class AF-5            16,000,000.00
               Class AF-6            10,000,000.00
               Class AF-7            15,552,000.00
               Class MF-1             2,090,000.00
               Class MF-2             7,167,000.00
               Class BF               3,643,000.00
               Class AV-1           240,704,246.21
               Class MV-1            13,896,000.00
               Class MV-2            26,924,000.00
               Class BV              13,028,000.00

                                                                   Group I        Group II

    Schedule Principal Balance of each Group @ 12/31/97         111,208,397.57   300,110,790.22

(6)  Substitution Shortfalls                                           -               -

(7)  Weighted Average Net Rate of Mortgage Loans                     9.66%           9.54%

(8)  Largest mortgage loan balance                                   878,651.14    1,514,778.48

(9)  Servicing Fees                                                  298,269.58      828,044.67
      Master Servicing Fees                                           17,437.84       49,683.24
 
(10) Index value for Variable Rate Certificates @ 12/31/97        5.69%

(11) Pass-through rates for Variable Rate Certificates            6.66%

</TABLE>
                                      -14-

<PAGE>


                                  EXHIBIT 99.4

         ANNUAL STATEMENT OF INDEPENDENT ACCOUNTANTS FOR EACH SERVICER


                                      -15-

<PAGE>


DELOITTE & TOUCHE LLP
Suite 500
Eighth & Main Building
707 East Main Street
Richmond, Virginia  23219
Telephone:  (804) 697-1500
Facsimile:  (804) 697-1825

INDEPENDENT ACCOUNTANTS' REPORT

To the Board of Directors
Meritech Mortgage Services, Inc.
Fort Worth, Texas

We have examined management's  assertion about Meritech Mortgage Services,  Inc.
("Meritech"),  compliance with servicing standards identified in the Appendix as
of and for the year  ended  December  31,  1997,  included  in the  accompanying
management  assertion.  Such standards were established by Meritech's management
based  on  the  Mortgage  Bankers   Association  of  America's   Uniform  Single
Attestation  Program for Mortgage Bankers (USAP).  Management is responsible for
Meritech's  compliance with these servicing standards.  Our responsibility is to
express an opinion on management's assertion about the entity's compliance based
on our examination.

Our  examination  was  made in  accordance  with  standards  established  by the
American  Institute of Certified Public  Accountants and,  accordingly  included
examining,  on a test  basis,  evidence  about  Meritech's  compliance  with the
servicing  standards  and  performing  such other  procedures  as we  considered
necessary  in the  circumstances.  We believe  that our  examination  provides a
reasonable  basis for our  opinion.  Our  examination  does not  provide a legal
determination  on  Meritech's  compliance  with the  servicing  standards or its
servicing agreements.

In  our  opinion,   management's  assertion  that  Meritech  complied  with  its
established  servicing  standards  identified in the Appendix as of and for the
 year ended December 31, 1997, is fairly stated, in all material respects.

/s/ Deloitte & Touche LLP
-------------------------
Deloitte & Touche LLP

March 25, 1998

                                      -16-

<PAGE>

In accordance  with the letter dated March 13, 1997 sent to the  Securities  and
Exchange Commission requesting an exception from SEC reporting requirements, the
Trust  is  to  include  as  an  exhibit  a  copy  of  the  annual  statement  of
independents'  accountants  for each  Servicer.  Such statement has not yet been
received for  Ameriquest.  Accordingly,  the annual  statement of  independents'
accountants  for  Ameriquest  will be  filed  with an  amended  10-K  when  such
statement is received.

                                      -17-