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                              SECOND WAIVER LETTER

                                                          As of October 31, 2003
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<S>                                                    <C>
ABFS Balapointe, Inc.                                American Business Financial Services, Inc.

American Business Credit, Inc.                       HomeAmerican Credit, Inc. d/b/a Upland Mortgage

American Business Mortgage Services, Inc.            JPMorgan Chase Bank, as Indenture Trustee

Chrysalis Warehouse Funding, LLC                     ABFS Mortgage Loan Warehouse Trust 2003-1
c/o Chrysalis Management Group, LLC                  c/o Wilmington Trust Company
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                  Re:  ABFS Mortgage Loan Warehouse Trust 2003-1
                       -----------------------------------------

         Reference is made to (i) that certain Sale and Servicing Agreement,
dated as of September 22, 2003 (the "Sale and Servicing Agreement"), among ABFS
Balapointe, Inc, as depositor (the "Depositor"), HomeAmerican Credit, Inc. d/b/a
Upland Mortgage ("Upland"), American Business Mortgage Services, Inc. ("ABMS"),
and American Business Credit, Inc. ("ABC"), ABFS Mortgage Loan Warehouse Trust
2003-1, as trust (the "Trust"), American Business Financial Services, Inc., as
sponsor (the "Sponsor"), JPMorgan Chase Bank, as indenture trustee (the
"Indenture Trustee") and JPMorgan Chase Bank, as collateral agent (the
"Collateral Agent"); (ii) that certain Indenture, dated as of September 22, 2003
(the "Indenture"), between the Trust and the Indenture Trustee; (iii) the 3/02
Amended and Restated Senior Secured Credit Agreement, dated March 15, 2002 (as
amended by the 12/02 Amendment, the 3/03 Amendment, 3/31/03 Amendment and the
9/03 Amendment, the "Credit Agreement"), among Upland, ABMS, ABC, Tiger
Relocation Company, ABFS Residual 2002, Inc., the Sponsor and JPMorgan Chase
Bank, as lender and agent (the "Lender"); and (iv) that certain Waiver Letter,
dated as of October 8, 2003 (the "First Waiver Letter"), by JPMorgan Chase Bank,
as note purchaser (the "Note Purchaser"). Capitalized terms used herein but not
defined herein shall have the meanings given in Appendix I to the Sale and
Servicing Agreement and the Indenture ("Appendix I").

         The undersigned, as Note Purchaser and 100% Noteholder under the Sale
and Servicing Agreement and the Indenture and as Lender under the Credit
Agreement, as applicable, hereby waives the failure by the Sponsor and its
Subsidiaries and Affiliates, as applicable, to comply on October 31, 2003 and
November 30, 2003 with (A) the terms of clause (ii) of the definition of
Amortization Event in Appendix I; (B) Section 11.10 of the Credit Agreement and
(C) clause (i) of the First Waiver Letter, in each case, regarding the
maintenance of a GAAP Net Worth of $28,000,000; provided, that such waiver is
granted in return for the Sponsor's agreement to maintain a positive GAAP Net
Worth for the periods ending October 31, 2003 and November 30, 2003.

         This waiver letter (the "Second Waiver Letter"), contains the entire
agreement relating to the subject matter hereof between the parties and
supersedes any prior oral or written agreement between the parties and shall not
be deemed to constitute a waiver as to any other transaction or occurrence.

         Except as expressly provided herein, all provisions, terms and
conditions, covenants and representations and warranties of the Sale and
Servicing Agreement, the Indenture and the Credit Agreement remain in full force
and effect.



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         IN WITNESS WHEREOF, the Note Purchaser has signed this Second Waiver
Letter as of the date set forth above.




                                    JPMORGAN CHASE BANK, as Note
                                    Purchaser, 100% Noteholder and Lender

                                             By:_______________________
                                                      Name:
                                                      Title: