EXHIBIT 10.9

          THIS CONTRACT IS SUBJECT TO ARBITRATION PURSUANT TO S.C. CODE
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          " 15-48-10 (UNLESS THE UNITED STATES ARBITRATION ACT APPLIES)
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                           MUTUAL INDEMNITY AGREEMENT

         This Mutual Indemnity Agreement is entered into between HomeGold
Financial, Inc. ("HomeGold") and Ronald J. Sheppard ("Sheppard").

         WHEREAS, HomeGold has entered into that certain Reorganization
Agreement dated February 29, 2000, as amended (the "Reorganization Agreement"),
with HomeSense Financial Corporation and its affiliated corporations listed in
SCHEDULE 3.5 to the Reorganization Agreement (collectively "HomeSense") pursuant
to which HomeSense will be merged into HomeGold;

         WHEREAS, Sheppard, as the principal shareholder of HomeSense has agreed
to indemnify HomeGold on a non-recourse basis against losses it may incur as a
result of breaches of HomeSense's warranties, representations and obligations
pursuant to the Reorganization Agreement, subject to the limitations set forth
in this Mutual Indemnity Agreement; and

         WHEREAS, HomeGold has agreed to indemnify Sheppard on a non-recourse
basis against losses he may incur as a result of breaches of HomeGold's
warranties, representations and obligations pursuant to the Reorganization
Agreement, subject to the limitations set forth in this Mutual Indemnity
Agreement;

         NOW, THEREFORE, it is agreed as follows:

         1.       Indemnity by Sheppard for Losses incurred by HomeGold as a
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                  result of breach of HomeSense's warranties, representations
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                  and obligations pursuant to the Reorganization Agreement.
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                  If HomeGold incurs any loss or damage as a result of breach of
any warranty or representation made by HomeSense in the Reorganization Agreement
or the failure of HomeSense to comply with any obligation under the
Reorganization Agreement, then Sheppard shall surrender for cancellation shares
of Preferred Stock equal, in par value, to the amount of such losses or damages.
Notwithstanding any other provision of this Agreement, the Reorganization
Agreement, or any other agreement, document or instrument contemplated by the
foregoing, Sheppard's liability under this Paragraph 1 shall be non-recourse
such that the sole and exclusive source of recovery by HomeGold (or any person
or entity claiming by, on behalf of or through HomeGold) shall be the Preferred
Stock. In no event shall Sheppard have any personal liability whatsoever in
respect of this Paragraph 1.

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         2.       Indemnity by HomeGold for Losses incurred by Sheppard as a
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                  result of breach of HomeGold's warranties, representations and
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                  obligations pursuant to the Reorganization Agreement.
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          If Sheppard incurs any loss or damage as a result of breach of any
warranty or representation made by HomeGold in the Reorganization Agreement or
the failure of HomeGold to comply with any obligation under the Reorganization
Agreement, then HomeGold shall issue to Sheppard shares of Preferred Stock
equal, in par value, to the amount of such losses or damages, provided that
HomeGold shall in no event be required to issue more than Five Million Three
Hundred Thousand (5,300,000) shares of Preferred Stock hereunder. HomeGold will
at all times reserve and keep available the number of shares of Preferred Stock
that shall be sufficient to satisfy the requirements of this Section 2.

         3.       Cash Payments in the event that the Equity of HomeSense at the
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                  Closing, determined in accordance with generally accepted
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                  accounting principles, is greater or less than $2,373,233.
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                  (a) If the Total Equity (i.e. total assets less total
liabilities) of HomeSense, at the Closing Date, determined in accordance with
generally accepted accounting principles by the auditors of HomeGold upon
completion of an audit, is greater than $2,373,233, then HomeGold shall
immediately pay to Sheppard, in cash, the amount of such excess and, if such
Total Equity at the Closing Date is less than $2,373,233, then Sheppard shall
immediately pay to HomeGold, in cash, the amount of such deficiency.
Notwithstanding any accounting rule or requirement or any provision of this
Agreement to the contrary, HomeGold acknowledges and agrees that for purposes of
calculating Total Equity, HomeSense's assets shall include the Sheppard
Indebtedness as defined in Section 5.4 of the Reorganization Agreement (i.e.,
such indebtedness shall not be excluded from Total Equity), and shall not be
reduced by an payments due to HomeSense's lenders which are paid to such lenders
as a result of, or in connection with, the Merger.

                  (b) HomeGold shall advise Sheppard as soon as practical after
the Closing of the auditors' determination of the Total Equity of HomeSense at
the Closing. If Sheppard disputes such determination, then such dispute shall be
resolved by arbitration in accordance with the provisions of Section 8 below.

         4. Release of Guarantees and Obligations. HomeGold covenants and agrees
to use its good faith best efforts as soon as practicable after the Effective
Time (as defined in the Reorganization Agreement) to obtain the full and
unconditional written release of Sheppard (in form and content reasonably
satisfactory to Sheppard) from any and all liability under or in respect of any
indebtedness or other obligation of HomeGold or HomeSense, other than liability
with respect to third party tort claims, for which Sheppard is or becomes liable
or responsible (whether by guarantee or otherwise) at or after the Effective
Time (the "Guaranteed Obligations").

         5. Subrogation. HomeSense and HomeGold, jointly and severally, covenant
and agree that, with respect to any Guaranteed Obligation, Sheppard shall be, to
the fullest extent


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permitted by law, subrogated to all rights of each creditor (including all
rights of such creditor as a secured party, if any) under any and all Guaranteed
Obligations.

         6. Indemnity With Respect to Guarantied Obligations. HomeGold shall
indemnify and hold Sheppard harmless against any liability with respect to the
Guarantied Obligations. Any indemnification payments pursuant to this Section 6
shall be paid in cash, and such cash payments shall be the exclusive remedy
under this Section 6.

         7. Exclusive Remedy. The provisions of this Agreement shall constitute
the exclusive remedies of HomeGold, HomeSense and Sheppard with respect to
breach of any provision of the Reorganization Agreement.

         8. Dispute Resolution. Any dispute hereunder shall be resolved by
arbitration in accordance with the rules of the American Arbitration
Association, with the expenses of such arbitration to be borne by HomeGold.

         IN WITNESS WHEREOF, this Mutual Indemnity Agreement is executed this
1st day of May, 2000.

                                       HOMEGOLD FINANCIAL, INC.


                                       By:_________________________________
                                          John M. Sterling, Jr., CEO


                                       ____________________________________
                                       Ronald J. Sheppard


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