EXHIBIT 10.32



AMENDMENT NO. 1 TO

CREDIT AGREEMENT



This Amendment No. 1 to
Credit Agreement (this Amendment) is entered into as of the 27th day of January, 2004, by and among DUXFORD FINANCIAL, INC., a California corporation (Duxford), and BAYPORT MORTGAGE, L.P., a California limited
partnership (Bayport), on the one had, and GUARANTY BANK (Lender) with reference to the following facts:



| | A. |  | Duxford, Bayport and Lender are parties to that certain Credit Agreement (the Agreement) dated as of August 29, 2003.
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| | B. |  | Pursuant to Section 9.2 of the Agreement, the Agreement may be amended in a writing signed by the applicable Borrower and Lender.
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| | C. |  | Borrowers and Lender desire to amend the Agreement to revise the limitations on indebtedness set forth in Section 6.2 of the Agreement as set forth herein.
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| | D. |  | Capitalized terms used but not defined herein shall have the respective meanings ascribed to them in the Agreement.
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NOW, THEREFORE, in consideration of the foregoing and of the mutual
agreements contained below, the parties hereby agree as follows:



1. Section 6.2. Section 6.2 of the Agreement is hereby amended and restated to read in its entirety as follows:



Section 6.2 Limitation on Indebtedness. No Related Person shall incur, create, contract, assume, have outstanding, guarantee
or otherwise be or become, directly or indirectly, liable in respect of any Indebtedness or Guaranty Obligations except:



(a) the Obligations;



(b) trade debt, equipment leases, equipment loans and liens for taxes and assessments not yet due and payable owed in the ordinary course
of business;



(c) Indebtedness arising under
Permitted Warehouse Facilities; and



(d)
Guaranty Obligations with respect to all obligations of William Lyon Homes, Inc., a California corporation (California Lyon), respect to (i) $250,000,000 of 103⁄4% Senior Notes due 2013 and (ii) $150,000,000 of 71⁄2% Senior
Notes due 2014 (together, as amended, supplemented, modified or refinanced from time to time, the Senior Notes), including, but not limited to, all obligations of California Lyon under the indentures governing the Senior Notes.



2. Effect of Amendment. Except as expressly
modified by this Amendment, the Agreement shall continue to be and remain in full force and effect in accordance with its



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terms. Any future reference to the Agreement shall be deemed to be a reference to the Agreement as modified by this
Amendment. The parties acknowledge that all of the provisions of the Agreement, except as expressly provided herein, shall remain in full force and effect in accordance with their terms. The Amendment shall be deemed to be effective as of August 29,
2003.



3. Counterparts. This Amendment may be
executed in two or more counterparts and by facsimile transmission, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument.



4. Governing Law. This Amendment shall be construed in accordance with and governed by the laws of the State
of Texas, without regard to conflicts of law or choice of law principles.



[Signature pages follow]



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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above
written.



|           |  |  |  |                                                          |  |     |  |                                                                       
|---------- |  |  |  | -------------------------------------------------------- |  | --- |  | ----------------------------------------------------------------------
|BORROWERS: |  |  |  | DUXFORD FINANCIAL, INC., A California Corporation       
|           |  |  |  |                                                         
|           |  |  |  |                                                          |  | By: |  | /s/  RICHARD FRANKEL                                                  
|           |  |  |  |                                                          |  |     |  | Name:  Richard Frankel Title:  Chairman                               
|           |  |  |  |                                                         
|           |  |  |  |                                                          |  | By: |  | /s/  MARK A. CARVER                                                   
|           |  |  |  |                                                          |  |     |  | Name:  Mark A. Carver Title:  President                               
|           |  | 
|           |  |  |  | BAYPORT MORTGAGE, L.P., a California Limited Partnership
|           |  |  |  |                                                         
|           |  |  |  |                                                          |  | By: |  | Duxford Financial, Inc., a California Corporation, its general partner

By:

/s/  RICHARD FRANKELName:  Richard Frankel Title:  ChairmanBy:

/s/  MARK A. CARVERName:  Mark A. Carver Title:  President


LENDER:



GUARANTY BANKBy:

/s/  JON LARSONName:  Jon Larson Title:  Senior Vice President