Document:

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                                                                  EXHIBIT 10.216

                  [PREFERRED EQUITIES CORPORATION LETTERHEAD]

July 7, 2000

Joel R. Buckberg, Esq.
Executive Vice President
Deputy General Counsel
Cendant Corporation
One Sylvan Way
Parsippany, New Jersey 07054

Via Facsimile (973) 496-5915 & US Mail

Re: Renewal of Agreement

Dear Joel,

Preferred Equities Corporation (PEC) provided the information requested in your
letter of June 2, 2000 on June 5,2000. As PEC has duly given the required notice
pursuant to the Agreement and provided the requested follow up information, PEC
considers the Agreement renewed and extended pursuant to the terms of the
Agreement.

We look forward to continuing to work with Cendant.

Very truly yours,

 /s/ JON A. JOSEPH
-----------------------------------
Jon A. Joseph
Vice President & General Counsel

JAJ/lad

cc:   R. Nederlander - Via Facsimile (212) 586-5862
      J. Cohen
      G. McMurtrie
      D. Campbell<PAGE>   1

                                                                  EXHIBIT 10.217

                                    DORFINCO
                                   CORPORATION

Subsidiary of                                           Commerce Center
Textron Financial Corporation                           333 East River Dr.
                                                        E. Hartford, CT  06108

                                                        Telephone (880) 282-7776
                                                        Fax: (880) 282-9053

September 18, 2000

Preferred Equities Corporation
4310 Paradise Road
Las Vegas, Nevada 89109

ATTENTION: Jon Joseph, General Counsel

Re: Amendment to Working Capital Loan

Gentlemen:

Reference is made to the Loan and Security Agreement dated August 12, 1998
between Dorfinco Corporation and Preferred Equities Corporation, as amended
("Loan Agreement") and the Deed of Trust, Security Agreement and Fixture Filing
dated August 12, 1998 among Preferred Equities Corporation as Grantor, United
Title of Nevada as Trustee and Dorfinco Corporation as Beneficiary recorded as
Document 450693 in the Official Records of Nye County, Nevada on August 13, 1998
(the "Deed of Trust") securing a $4,000,000 loan made to Guarantor (the "Loan")
as evidenced by promissory note dated August 12, 1998 by Guarantor (the "Note").
All defined terms used herein shall have the meanings assigned in the Loan
Agreement and/or Deed of Trust and/or Note.

Previously, Grantor exercised its rights for an Extended Maturity Date of August
30, 2000 and paid the required extension fee. In addition the Note and Deed of
Trust were revised on March 10, 2000 with respect to payments of the principal
balances and other terms. Grantor has requested a further extension until
December 31, 2001 and has requested a modification to the mandatory principal
pay-down schedule.

Borrower has indicated that the remaining three parcels of property have been
listed for sale at the amounts below:

<TABLE>
<CAPTION>
         Property        Original Appraised Value      List Price
         --------        ------------------------      ----------
<S>                      <C>                           <C>
         Parcel 3                3,760,000             3,000,000
         Parcel 4                3,050,000             2,500,000
         Parcel 5                3,925,000             1,750,000
</TABLE>

Borrower has requested and Beneficiary has agreed to amend the terms of the Loan
Agreement, Deed of Trust and Note under the following terms and conditions:

<PAGE>   2

1. Sub Section 4(i)-(iv) of the Note shall be revised as follows:

        (i) On December 31, 2000, an installment of principal in an amount
        necessary and sufficient to cause the total outstanding principal
        balance remaining under the Note to be Two Million Five Hundred Thousand
        Dollars ($2,500,000.00) or less;

        (ii) On July 31, 2001, an installment of principal in an amount
        necessary and sufficient to cause the outstanding principal balance
        remaining under the Note to be One Million Five Hundred Thousand Dollars
        ($1,500,000.00) or less;

        (iii) On the Extended Maturity Date, which is December 31, 2001, the
        entire outstanding principal balance of the Loan, plus all accrued and
        unpaid interest thereon and any other amounts then due and payable under
        the Note or any of the Loan Documents shall be due and payable.

        (iv) In addition to the mandatory principal payments above, Borrower
        shall pay a monthly principal payment commencing on October 1, 2000 in
        an amount equal to $13,900 or such amount based on a twenty (20) year
        amortization together with the interest payment payable under Section 2
        of this Note.

2. The Maturity Date under the Loan Agreement and Note shall be December 31,
2001.

3. Section 1.16 (b)(i) of the Deed of Trust was revised on March 10, 2000 and
continues to be effective as follows:

        ...(i) Grantor shall pay to Beneficiary a release payment equal to 100%
        gross sales proceeds for the applicable parcel of land (including any
        deferred, contingent or earn-out portions thereof or any additional
        consideration to be paid by the purchaser or transferee subsequent to
        the closing of the acquisition of the applicable parcel of land) minus a
        6% brokers commission and reasonable closing costs.

        Notwithstanding the foregoing, if an Event of Default or circumstance
        that with the passage of time or giving of notice or both would
        constitute an Event of Default shall then exist and be continuing,
        Beneficiary may in its sole discretion require that any such release
        payment be increased. No additional release payment shall be payable
        upon the repayment and satisfaction in full of the Indebtedness.

4. The Loan Agreement and Section 10 of the Subordination Agreement dated August
12, 1998 issued by Mego Financial Corporation ("Mego") was amended on March 10,
2000 and shall be reaffirmed to reflect that Guarantor shall not without prior
written consent of Beneficiary, make any principal payments to Mego or any other
shareholders of Mego holding notes payable by Guarantor or Mego unless the Loan
is paid or the revised schedule payments are met. Mego and such creditors shall
acknowledge such restriction hereunder.

5. In consideration of the above amendments and as a condition precedent
thereto:

        a. Grantor shall pay Beneficiary an amendment fee equal to 1% of the
outstanding principal balance of the Loan or $33,000 within 30 days upon
execution of this letter; and

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        b. Grantor reaffirms all of its obligations under the Note, Loan
Agreement and Deed of Trust, and Grantor acknowledges that it has no claims,
offset or defenses with respect to the payment of any sum due under the Loan or
any loan documents, promissory notes or other agreements of any kind evidencing
any indebtedness of Grantor to Beneficiary to which it is a party.

6. Except as specifically hereby amended, the Loan Agreement, Note, Deed of
Trust, Subordination Agreement and any other loan documents ("the Loan
Documents") shall remain unaffected by this Amendment, and shall remain in full
force and effect. Nothing in this Amendment shall impair the liens of the Loan
Documents, which shall remain a deed of trust with the power of sale, creating a
first lien(s) encumbering the property described therein, subject to permitted
exceptions to title approved by Beneficiary. Notwithstanding the foregoing, the
Loan Documents will be formally amended and recorded as necessary including but
not limited to the Note and Deed of Trust. Borrower shall deliver by November 1,
2000 appropriate title insurance endorsements, updated corporate certifications
and opinions as deemed necessary by Beneficiary and its counsel. All fees
associated with such amendment shall be payable by Beneficiary in accordance
with the Loan Documents.

7. In the event a proposed loan is made to an affiliate of Grantor by
Beneficiary in the approximate principal amount of Ten Million One Hundred
Thousand Dollars ($10,100,000) then Grantor shall guarantee such loan and
security such guaranty with the property described in the Deed of Trust together
with any other collateral required by the approval for such loan.

Very truly yours,
DORFINCO CORPORATION

By:  /s/ John  T. D'Annibale
   -----------------------------------
     AVP

                                    CONSENTS

        The undersigned hereby consent to the terms, conditions and provisions
of the foregoing Letter Amendment to the Loan Agreement, Note, Deed of Trust and
Subordination Agreement and the transactions contemplated by it. Guarantor
hereby affirms the full force and effectiveness of its guaranty agreement and
obligations thereunder with respect to any indebtedness and obligations of
Grantor and Borrower guaranteed by Guarantor. Borrower hereby affirms the full
force and effectiveness of its obligations to Lender under the Loan Documents
and its guaranty agreement and obligations with respect to any indebtedness and
obligations of Grantor to Beneficiary guaranteed by Borrower.

Dated: October 4, 2000

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ACKNOWLEDGED:

PREFERRED EQUITIES CORPORATION,
A Nevada corporation (Borrower)

By: /s/ Jon Joseph
   -----------------------------------

Name: Jon A. Joseph
     ---------------------------------

Title: Senior Vice President
      --------------------------------

ACKNOWLEDGED BY GUARANTOR:

MEGO FINANCIAL CORPORATION,
A New York corporation (Guarantor/Subordinated Creditor)

By: /s/ Jon Joseph
   -----------------------------------

Name: Jon A. Joseph
     ---------------------------------

Title: Vice President
      --------------------------------

--------------------------------------------
Additional Creditors of Preferred Equities Corporation/Mego Financial
Corporation:

By:                                       By:
   ---------------------------------         ----------------------------------

By:                                       By:
   ---------------------------------         ----------------------------------

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