Document:

<PAGE>

                                                                    Exhibit 10.5

                     AMENDED AND RESTATED SECURITY AGREEMENT

         This Amended and Restated Security Agreement ("Agreement") dated
November 15, 2004, among ABFS CONSOLIDATED HOLDINGS, INC., a Delaware
corporation, AMERICAN BUSINESS MORTGAGE SERVICES, INC., a New Jersey
corporation, HOMEAMERICAN CREDIT, INC., a Pennsylvania corporation, and AMERICAN
BUSINESS CREDIT, INC., a Pennsylvania corporation (each a "Grantor" and
collectively, the "Grantors") and U.S. BANK, NATIONAL ASSOCIATION, a national
banking association, as trustee for the Securityholders (as defined below)
("Secured Party").

                                   BACKGROUND

         A. On December 31, 2003, American Business Financial Services, Inc.
("Company") entered into a certain Indenture (as it may hereafter be amended,
supplemented or replaced from time to time, "2003 Indenture"), pursuant to which
the Company issued Senior Collateralized Notes to the Securityholders defined
therein ("2003 Holders"). Secured Party is acting as trustee for the benefit of
the 2003 Holders in accordance with the terms of the 2003 Indenture.

         B. On June 30, 2004, Company entered into a certain Indenture (as it
may hereafter be amended, supplemented or replaced from time to time, "2004
Indenture" and collectively with the 2003 Indenture, the "Indentures"), pursuant
to which the Company issued Senior Collateralized Notes to the Securityholders
defined therein ("2004 Holders", and together with the 2003 Holders, the
"Securityholders"). Secured Party is acting as trustee for the benefit of the
2004 Holders in accordance with the terms of the 2004 Indenture. Capitalized
terms used but not defined herein shall have the meanings given to such terms as
set forth in the Indentures, as applicable.

         C. To secure repayment of the Note Obligations and all other
undertakings of the Company to the Secured Party and the Securityholders under
the Indentures, each Grantor granted to Secured Party, for the benefit of the
Securityholders, security interests in certain property of each Grantor more
particularly described in that certain (i) Security Agreement executed by
Grantors and accepted by Secured Party dated December 31, 2003 (as it may have
been amended, supplemented or replaced from time to time, "2003 Security
Agreement") and (ii) Security Agreement executed by Grantors and accepted by
Secured Party dated June 30, 2004 (as it may have been amended, supplemented or
replaced from time to time, "2004 Security Agreement" and collectively with the
2003 Security Agreement, the "Security Agreements").

         D. The Company has completed or expects to complete certain additional
financing and in connection therewith has caused or may cause the Grantors to
transfer certain of their assets to ABFS Warehouse Trust 2004-1, established
pursuant to the terms of that certain Trust Agreement by and between American
Business Financial Services, Inc., as Depositor and Wilmington Trust Company, as
Owner Trustee dated November 3, 2004 (as same may be amended, restated or
replaced from time to time, the "2004 ABFS Trust").

<PAGE>

         E. In order to secure repayment of the Note Obligations, and all other
undertakings of the Company to the Secured Party and the Securityholders under
the Indentures, each Grantor desires to amend and restate the Security
Agreements which shall include a reconfirmation of the prior grant of the
security interests to Secured Party.

         NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:

                          SECTION 1 - SECURITY INTEREST

         1.1 Description: As security for the payment of the Note Obligations
and undertakings of every kind or nature whatsoever of the Company to the
Securityholders and Secured Party, whether now existing or hereafter incurred,
matured or unmatured, direct or indirect, primary or secondary, related or
unrelated or due or to become due, arising under the Indenture, and any
extensions, modifications, substitutions, increases and renewals thereof, and
substitutions therefore; the payment of all amounts advanced by Secured Party to
preserve, protect, defend, and enforce its rights hereunder and in the following
property in accordance with the terms of this Agreement, each Grantor hereby
confirms, assigns and grants to Secured Party (for the benefit of the
Securityholders), a continuing lien on and security interest in, upon and to all
of such Grantor's now owned and hereafter acquired, created or arising General
Intangibles (including Payment Intangibles) arising out of, related to or owing
to each Grantor as a result of such Grantor's, direct or indirect, (a) ownership
interest in ABFS Warehouse Trust 2003-1, established pursuant to the terms of
that certain Amended and Restated Trust Agreement among Grantors and Wilmington
Trust Company dated October 14, 2003 (as same may be amended, restated or
replaced from time to time, the "2003 ABFS Trust") or (b) ownership interest in
the 2004 ABFS Trust, and (c) the non-cash proceeds of the foregoing
(collectively, the "Collateral").

         For purposes hereof, the term "General Intangibles" means the right to
receive any and all cash (including Payment Intangibles) due, if, and when,
received, under a specified contract or ownership interest in a trust or other
business entity, and the term "Payment Intangibles" means payment intangibles as
defined in the Uniform Commercial Code as in effect from time to time in the
State of Delaware.

         1.2 Lien Documents: As Secured Party deems necessary, each Grantor
shall execute and deliver to Secured Party, or have executed and delivered (all
in form and substance satisfactory to Secured Party), any agreements, documents,
instruments and writings, required to evidence, perfect or protect Secured
Party's lien and security interest in the Collateral required hereunder.

         1.3 Other Actions:

                  (a) Secured Party is hereby authorized to file financing
statements and amendments to financing statements without any Grantor's
signature in accordance with the Uniform Commercial Code as in effect in the
State of Delaware from time to time (the "UCC") describing the Collateral. Each
Grantor agrees to comply with the requirements of all state and federal laws and
requests of Secured Party in order for Secured Party to have and maintain a
valid and perfected first security interest in the Collateral.

                                       2
<PAGE>

                  (b) In addition to the foregoing, each Grantor shall do
anything further that may be reasonably required by Secured Party to secure
Secured Party and effectuate the intentions and objects of this Agreement,
including, without limitation, the execution and delivery of security
agreements, contracts and any other documents required hereunder. At Secured
Party's request, each Grantor shall also immediately deliver (with execution by
such Grantor of all necessary documents or forms to reflect, implement or
enforce the Note Liens described herein) to Secured Party all items of which
Secured Party must receive possession to obtain a perfected security interest in
the Collateral.

         1.4 Filing Security Agreement: A carbon, photographic or other
reproduction or other copy of this Agreement or of a financing statement is
sufficient as and may be filed in lieu of a financing statement.

         1.5 Power of Attorney: Each of the officers of Secured Party or its
representative is hereby irrevocably made, constituted and appointed the true
and lawful attorney for each Grantor (without requiring it to act as such) with
full power of substitution to do the following, subject to the rights of the
holders of any Senior Debt existing on the date hereof or arising in the future:
(a) execute in the name of each Grantor, schedules, assignments, instruments,
documents and statements that such Grantor is obligated to give Secured Party
hereunder or is necessary to perfect (or continue to evidence the perfection of
such security interest or Lien); (b) during the continuance of a Default,
endorse the name of Grantor upon any and all checks, drafts, money orders and
other instruments for the payment of monies that are payable to such Grantor and
constitute collections on such Grantor's Collateral; and (c) during the
continuance of a Default, do such other and further acts and deeds in the name
of such Grantor that Secured Party may reasonably deem necessary or desirable to
enforce any Collateral or perfect Secured Party's security interest or Note Lien
in the Collateral.

         1.6 Restatement: This Agreement amends, restates and supercedes the
Security Agreements. This Agreement is not intended to alter or impair the
scope, validity, enforceability or priority of the liens created under the
Security Agreements, which continue in full force and effect.

                   SECTION 2 - REPRESENTATIONS AND WARRANTIES

         2.1 Each Grantor represents and warrants to Secured Party that:

                  (a) Organization - Such Grantor (i) is duly organized and
validly existing under the laws of its state of incorporation, (ii) has the
power and authority to operate its business and to own its Property and (iii) is
duly qualified, is validly existing and in good standing and has lawful power
and authority to engage in the business;

                                       3
<PAGE>

                  (b) Non-Contravention - The making and performance of this
Agreement and other agreements executed in connection herewith will not
(immediately, with the passage of time or with the giving of notice or both):

                           (i) violate the certificate of incorporation or
by-laws of such Grantor or result in a default under any contract, agreement or
instrument to which such Grantor is a party or by which such Grantor or its
property is or may be bound, or

                           (ii) result in the creation or imposition of any
security interest in, or lien or encumbrance upon, any of the assets of such
Grantor, except such as are in favor of Secured Party;

                  (c) Power and Authority - such Grantor has the power and
authority to enter into and perform this Agreement and to incur the obligations
herein and therein provided for, and has taken all proper and necessary action,
corporate or otherwise, to authorize the execution, delivery and performance of
this Agreement;

                  (d) Enforceable - This Agreement is valid, binding and
enforceable against such Grantor in accordance with its terms;

                  (e) Consents and Approvals - All necessary consents, approvals
or authorizations of, or filing, registration or qualification with, any Person,
required to be obtained by such Grantor in connection with the execution and
delivery of this Agreement or the undertaking or performance of any obligation
hereunder has been obtained;

                  (f) Title - The Collateral is free and clear of any and all
liens, claims, encumbrances or security interests other than Permitted Liens (as
defined in the Indenture);

                  (g) Governmental Consent - Neither the nature of any Grantor
or of its business or Property, nor any relationship between such Grantor and
any other Person, nor any circumstance affecting such Grantor in connection with
the issuance or delivery of this Agreement is such as to require a consent,
approval or authorization of, or filing, registration or qualification with, any
governmental authority on the part of such Grantor;

                  (h) Government Regulations - (i) such Grantor has obtained all
licenses, permits, franchises or other governmental authorizations necessary for
the ownership of its Property and for the conduct of its business; and (ii) such
Grantor is not in violation of or receipt of written notice that it is in
violation of any applicable statute, regulation or ordinance of the United
States of America, or of any state, city, town, municipality, county or of any
other jurisdiction, or of any agency, or department thereof, (including, without
limitation, Environmental Laws or government procurement regulations), a
violation of which causes or could cause a material adverse effect; and

                  (i) Perfection - This Agreement is effective to create in
favor of Secured Party legal, valid and enforceable Liens in all right, title
and interest of such Grantor in the Collateral, and when financing statements
have been filed in the offices of the jurisdiction shown on Schedule "2.1(i)"
attached hereto and made a part hereof under such Grantor's name, Secured Party
has and will continue to have perfected Liens in the Collateral, superior in
right to any and all other consensual Liens, existing or future, other than
Permitted Liens.

                                       4
<PAGE>

                              SECTION 3 - COVENANTS

         3.1 Each Grantor covenants that:

                  (a) Payment of Taxes and Claims - such Grantor shall pay,
before they become delinquent,

                           (i) all taxes, assessments and governmental charges
or levies imposed upon it or upon such Grantor's Property, and

                           (ii) all claims or demands of materialmen, mechanics,
carriers, warehousemen, landlords and other Persons entitled to the benefit of
statutory or common law Liens, which, if unpaid, would result in the imposition
of a Lien upon its Property; provided, however, that such Grantor shall not be
required to pay any such tax, assessment, charge, levy, claim or demand if the
amount, applicability or validity thereof shall at the time be contested in good
faith and by appropriate proceedings by such Grantor, and if such Grantor shall
have set aside on its books adequate reserves in respect thereof, if so required
in accordance with GAAP; which deferment of payment is permissible so long as no
Lien has been entered and such Grantor's title to, and its right to use, its
Property are not materially adversely affected thereby;

                  (b) Property Insurance, Public and Products Liability
Insurance - such Grantor shall maintain insurance (i) on all insurable tangible
Property against fire, flood, casualty and such other hazards (including,
without limitation, extended coverage, workmen's compensation, boiler and
machinery, with inflation coverage by endorsement) and (ii) against public
liability, product liability and business interruption, in each case in such
amounts, with such deductibles and with such insurers as are customarily used by
companies operating in the same industry as such Grantor. Each Grantor further
covenants that all insurance premiums owing under its current policies have been
paid. Each Grantor shall notify Secured Party, immediately, upon such Grantor's
receipt of a notice of termination, cancellation, or non-renewal from its
insurance company of any such policy;

                  (c) Financial Records - such Grantor shall keep current and
accurate books of records and accounts in which full and correct entries will be
made of all of its business transactions, and will reflect in its financial
statements adequate accruals and appropriations to reserves, all in accordance
with GAAP;

                  (d) Corporate Existence and Rights - such Grantor shall do (or
cause to be done) all things necessary to preserve and keep in full force and
effect its existence, good standing, rights and franchises. Each Grantor shall
maintain any and all licenses, permits, franchises or other governmental
authorizations necessary to the ownership of its Property or to the conduct of
its businesses;

                                       5
<PAGE>

                  (e) Compliance with Laws - such Grantor: (i) shall be in
compliance with any and all laws, ordinances, governmental rules and
regulations, and court or administrative orders or decrees to which it is
subject, whether federal, state or local, and (ii) shall obtain any and all
licenses, permits, franchises or other governmental authorizations necessary to
the ownership of its Property or to the conduct of its businesses, which
violation or failure to obtain causes or could cause a material adverse effect.
Each Grantor shall timely satisfy all assessments, fines, costs and penalties
imposed (after exhaustion of all appeals, provided a stay has been put in effect
during such appeal) by any governmental authority against such Grantor or any
Property of such Grantor;

                  (f) Issue Taxes - such Grantor shall pay all taxes (other than
taxes based upon or measured by any Secured Party's income or revenues or any
personal property tax), if any, in connection with the recording of any lien
documents. The obligations of each Grantor hereunder shall survive the
termination of this Agreement;

                  (g) Merger, Consolidation, Dissolution or Liquidation - No
Grantor may consolidate or merge with or into, or sell, assign, transfer, lease,
convey or otherwise dispose of all or substantially all of its properties or
assets in one or more related transactions to another corporation, Person or
entity unless (a) such Grantor is the surviving corporation or the entity or the
Person formed by or surviving any such consolidation or merger (if other than
such Grantor) or to which such sale, assignment, transfer, lease, conveyance or
other disposition shall have been made is a corporation, Person or entity
organized or existing under the laws of the United States, any state thereof or
the District of Columbia; (b) the entity or Person formed by or surviving any
such consolidation or merger (if other than such Grantor) or the entity or
Person to which such sale, assignment, transfer, lease, conveyance or other
disposition will have been made assumes all the obligations of such Grantor
under this Agreement; and (c) after giving effect to such sale, assignment,
transfer, lease, conveyance or other disposition, no Default shall occur under
the Indenture;

                  (h) Liens and Encumbrances - such Grantor shall not cause or
permit or agree or consent to cause or permit in the future (upon the happening
of a contingency or otherwise) the Collateral, whether now owned or hereafter
acquired, to be subject to a Lien or be subject to any claim unless (i) such
Lien is a Permitted Liens or (ii) at the time of granting such Lien, the
Collateral Coverage Ratio is at least 1.5 to 1;

                  (i) Other Agreements - such Grantor shall not become or be a
party to any contract or agreement which at the time of becoming a party to such
contract or agreement materially impairs such Grantor's ability to perform under
this Agreement, or under any other instrument, agreement or document to which
such Grantor is a party or by which it is or may be bound; and

                  (j) Change of Location or Jurisdiction of Organization - such
Grantor agrees that it shall not change its name or jurisdiction of organization
without thirty (30) days prior written notice to Secured Party.

                                       6
<PAGE>

         3.2 Subordination: Notwithstanding anything to the contrary contained
in this Agreement, Secured Party's rights and the Liens created hereunder, shall
be subject and subordinate to the rights of the holder of any Priority Liens. By
its acceptance and acknowledgment hereof, Trustee (on behalf of the
Securityholders) hereby confirms that Trustee shall execute and deliver to any
holder of the Senior Debt any and all documents, instruments or agreements
required by such holder to evidence the subordination of the Lien granted
hereunder to the priority of the Priority Lien.

                               SECTION 4 - DEFAULT

         4.1 Default: The occurrence of an Event of Default under the Indentures
shall constitute a default ("Default") hereunder and Secured Party shall
thereupon have the option to declare Grantors in default under this Agreement,
and all other existing and future agreements of any kind (related or unrelated)
with Secured Party, and declare all existing and future liabilities,
indebtedness and obligations of each Grantor to Secured Party, whether matured
or contingent, related or unrelated, due or to become due, immediately due and
payable including, but not limited to, interest, principal, and expenses and all
of Secured Party's rights hereunder and thereunder, all without demand, notice,
presentment or protest or further action of any kind.

         4.2 Rights and Remedies on Default: In addition to all other rights,
options and remedies granted to Secured Party under this Agreement (each of
which is also then exercisable by Secured Party), Secured Party may, upon the
occurrence of a Default, exercise any other rights granted to it under the UCC
and any other applicable law, including, without limitation, the following
rights and remedies: take possession of, send notices, and collect directly the
Collateral, with or without judicial process (including, without limitation the
right to notify the United States postal authority to redirect all mail
addressed to each Grantor to an address designated by Secured Party).

         4.3 Nature of Remedies: Secured Party shall have the right to proceed
against all or any portion of the Collateral in any order and may apply such
Collateral to the liabilities and obligations of the Company and/or any Grantor
to Secured Party in any order. All rights and remedies granted Secured Party
hereunder and under any agreement referred to herein, or otherwise available at
law or in equity, shall be deemed concurrent and cumulative, and not alternative
remedies, and Secured Party may proceed with any number of remedies at the same
time until all existing and future liabilities and obligations of the Company
and/or the Grantors to Secured Party, are satisfied in full. The exercise of any
one right or remedy shall not be deemed a waiver or release of any other right
or remedy, and Secured Party, upon the occurrence of a Default, may proceed
against the Company, any Grantor, and/or the Collateral, at any time, under any
agreement, with any available remedy and in any order.

                            SECTION 5 - MISCELLANEOUS

         5.1 Governing Law: This Agreement, and all related agreements and
documents shall be governed by and construed in accordance with the laws of the
State of Delaware, without regard to its otherwise applicable principles of
conflicts of laws.

                                       7
<PAGE>

         5.2 Notices. Any notice, instruction, direction, request or other
communication by the Company, any Grantor, the Trustee or any other holder of
Senior Debt to the others is duly given if in writing and delivered in person or
mailed by first-class mail (registered or certified, return receipt requested),
telex, telecopier or overnight air courier guaranteeing next day delivery, to
the other's address:

         If to the Company:

                  AMERICAN BUSINESS FINANCIAL SERVICES, INC.
                  The Wanamaker Building
                  100 Penn Square East
                  Philadelphia, Pennsylvania  19004
                  Attention:   Stephen M. Giroux
                               Senior Vice President and General Counsel
                  Telecopier:  (215) 940-4537

         If to any Grantor:

                  c/o AMERICAN BUSINESS FINANCIAL SERVICES, INC.
                  The Wanamaker Building
                  100 Penn Square East
                  Philadelphia, Pennsylvania  19004
                  Attention:   Stephen M. Giroux
                               Senior Vice President and General Counsel
                  Telecopier:  (215) 940-4537

         With a copy to:

                  BLANK ROME LLP
                  One Logan Square
                  Philadelphia, Pennsylvania  19103-2599
                  Attention:   Lawrence F. Flick, II, Esquire
                  Telecopier:  (215) 569-5556

         If to the Trustee:

                  U.S. BANK NATIONAL ASSOCIATION
                  Mail Code EP-MN-WS3C 60
                  Livingston Avenue
                  St. Paul, Minnesota 55107
                  Attention:   Mr. Richard Prokosch, Corporate Trust
                  Phone:       (651) 495-3918
                  Telecopier:  (651) 495-8097

         If to a holder of Senior Debt, such address as such holder of Senior
Debt shall have provided in writing to the Company and the Trustee.

                                       8
<PAGE>

         Any Grantor, the Trustee or a holder of Senior Debt by notice to the
Company, the Grantors and the Trustee may designate additional or different
addresses for subsequent notices or communications.

         All notices and communications shall be deemed to have been duly given:
at the time delivered by hand, if personally delivered; five Business Days after
being deposited in the mail, postage prepaid, if mailed; when answered back, if
telexed; when receipt acknowledged, if telecopied; and the next Business Day
after timely delivery to the courier, if sent by nationally recognized overnight
air courier guaranteeing next day delivery.

         If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.

         If any Grantor mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.

         5.2 Waiver:

                  (a) No omission or delay by Secured Party in exercising any
right or power under this Agreement or any other document will impair such right
or power or be construed to be a waiver of any Default or an acquiescence
therein, and any single or partial exercise of any such right or power will not
preclude other or further exercise thereof or the exercise of any other right,
and no waiver of Secured Party's rights hereunder will be valid unless in
writing and signed by Secured Party, and then only to the extent specified.

                  (b) Each Grantor releases Secured Party, its agents,
administrators and executors, its officers, employees and agents, of and from
any claims for loss or damage resulting from acts or conduct of any or all of
them arising through the date hereof, unless caused solely by willful misconduct
or gross negligence.

         5.3 Modification: No modification hereof or any agreement referred to
herein shall be binding or enforceable unless in writing and signed on behalf of
the party against whom enforcement is sought.

         5.4 Signatories: Each individual signatory hereto represents and
warrants that he/she is duly authorized to execute this Agreement on behalf of
his/her principal and that he/she executes the Agreement in such capacity and
not as a party.

         5.5 Counterpart Originals: The parties may sign any number of copies of
this Indenture. Each signed copy shall be an original, but all of them together
represent the same agreement.

         5.6 Successors and Assigns: All provisions herein shall inure to,
become binding upon the successors, representatives, trustees, administrators,
executors, heirs and assigns of the parties hereto.

                                        9
<PAGE>

         5.7 Headings, etc.: Any cross-reference, table and headings of the
Articles and Sections of the Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof and shall in no way
modify or restrict any of the terms or provisions thereof.

         5.8 Consent to Jurisdiction: Each Grantor irrevocably consents to the
jurisdiction of the Courts of Delaware or the United States District Court for
the District of Delaware in any and all actions and proceedings whether arising
hereunder or under any other agreement or undertaking and irrevocably agrees to
service of process to the address of such Grantor set forth herein by certified
mail, return receipt requested.

         5.9 WAIVER OF JURY TRIAL: EACH GRANTOR AND SECURED PARTY HEREBY WAIVE
ANY AND ALL RIGHTS ANY MAY HAVE TO A JURY TRIAL IN CONNECTION WITH ANY
LITIGATION COMMENCED BY OR AGAINST SECURED PARTY WITH RESPECT TO RIGHTS AND
OBLIGATIONS OF THE PARTIES HERETO.

                     [SIGNATURES TO FOLLOW ON SEPARATE PAGE]

                                       10
<PAGE>

         IN WITNESS WHEREOF, the undersigned parties have executed this
Agreement the day and year first above written.

                                ABFS CONSOLIDATED HOLDINGS, INC.

                                By: /s/ Stephen M. Giroux
                                    -------------------------------------------
                                    Stephen M. Giroux, Executive Vice President

                                AMERICAN BUSINESS MORTGAGE SERVICES, INC.

                                By: /s/ Stephen M. Giroux
                                    -------------------------------------------
                                    Stephen M. Giroux, Executive Vice President

                                HOMEAMERICAN CREDIT, INC.

                                By: /s/ Stephen M. Giroux
                                    -------------------------------------------
                                    Stephen M. Giroux, Executive Vice President

                                AMERICAN BUSINESS CREDIT, INC.

                                By: /s/ Stephen M. Giroux
                                    -------------------------------------------
                                    Stephen M. Giroux, Executive Vice President

Acknowledged and Accepted:
U.S. BANK, NATIONAL ASSOCIATION
AS TRUSTEE FOR THE SECURITYHOLDERS

By: /s/ Richard Prokosch
    ------------------------------
Name: Richard Prokosch
Title: Vice President

                     (Signature Page to Security Agreement)

                                      S-1<PAGE>

                                                                    Exhibit 10.6

                             Clearwing Capital, LLC
                       c/o Chrysalis Management Group, LLC
                             The Belgravia Building
                         1811 Chestnut Street, Suite 700
                        Philadelphia, Pennsylvania 19103

                                November 12, 2004

ABFS Warehouse Trust 2003-1
c/o Wilmington Trust Company as Owner Trustee
Rodney Square North
1100 North Market Street
Wilmington, DE  19890
Telephone No.: (302) 651-1000
Fax No.: (302) 636-4140
Attention:  Corporate Trust Administration

Re:      PATRIOT - PURCHASED SECURITIES TRANSACTION

To Whom It May Concern:

                  Reference is made to (a) that certain Loan and Security
Agreement, dated as of October 14, 2003 (the "Loan Agreement"), between ABFS
Warehouse Trust 2003-2 (the "Borrower") and Chrysalis Warehouse Funding, LLC
(the "Lender"), a wholly-owned affiliate of Clearwing Capital, LLC
("Clearwing"), (b) that certain Trust Agreement, dated as of October 14, 2003
(the "Trust Agreement"), among ABFS Consolidated Holdings, Inc. ("Holdings") and
certain subsidiaries of Holdings and Wilmington Trust Company, as trustee for
ABFS Warehouse Trust 2003-1, a Delaware statutory trust ("Trust 2003-1"), (c)
that certain Pledge and Security Agreement, dated as of October 14, 2003 (the
"Pledge Agreement"), between Trust 2003-1 and Clearwing, and (d) that certain
Fee Letter, dated as of October 14, 2003, by and among Borrower and certain of
its affiliates (Borrower and such affiliates, the "Obligors") and Clearwing, as
amended by that certain letter agreement, dated as of September 27, 2004, by and
among Clearwing and the Obligors (the "2003 Fee Letter"). Except as provided in
Paragraph 4 herein or as otherwise indicated, capitalized terms used herein and
not otherwise defined shall have the meaning ascribed to them in the Pledge
Agreement.

                  Further reference is made to that certain Consent and
Amendment to Fee Letter, dated as of October 26, 2004 (the "October 26
Consent"), executed by Clearwing and accepted and agreed to by the Obligors.

                  Trust 2003-1 has advised Clearwing (a) that American Business
Financial Services, Inc. ("ABFS") desires to consummate the transaction for the
"Purchased Securities" (as such term is defined in the Patriot Commitment

<PAGE>

Letter, the "Purchased Securities Transaction") prior to the consummation of the
transaction for the "Wet Warehouse" (as such term is defined in the Patriot
Commitment Letter); and (b) that certain of the conditions precedent to the
effectiveness of the October 26 Consent will not be satisfied prior to the
consummation of the Purchased Securities Transaction.

                  To enable ABFS to consummate solely the Purchased Securities
Transaction, Trust 2003-1 has requested that Clearwing agree solely to (a)
release its lien on the interest-only strips listed on Schedule 1 attached
hereto (the "Schedule 1 IOS"), and (b) release any lien that Clearwing might
have on any of Trust 2003-1's rights to servicing advances arising under any of
the agreements listed on Schedule 2 attached hereto (the "Schedule 2 Servicing
Agreements").

                  Now therefore:

                  1. October 26 Consent. The parties hereby confirm that the
October 26 Consent is not effective.

                  2. Consent. Subject to the terms and conditions contained
herein (including without limitation Paragraph 4), Clearwing hereby (a) agrees
to release its lien on the Schedule 1 IOS, (b) consents to the distribution by
Trust 2003-1 to Holdings of the Schedule 1 IOS, (c) agrees to release any lien
that Clearwing might have on any of Trust 2003-1's rights to servicing advances
arising under the Schedule 2 Servicing Agreements, (d) consents to the
distribution by Trust 2003-1 to American Business Credit, Inc. of any rights
that Trust 2003-1 has to the servicing advances arising under the Schedule 2
Servicing Agreements, and (e) agrees to release any rights that Clearwing might
have in or to Class X Certificate, No. X-1, issued by ABFS Mortgage Loan Trust
2001-2.

                  3. Conditions Precedent. The effectiveness of this letter
agreement (and the consents provided herein) are subject to the fulfillment, to
the satisfaction of Clearwing, of the following conditions:

                  (a) Clearwing shall have received this letter agreement duly
executed by the parties hereto, and the same shall be in full force and effect;

                  (b) All documents and legal matters in connection with the
Purchased Securities Transaction shall have been delivered, executed, or
recorded and shall be in form and substance satisfactory to Clearwing;

                  (c) All of the conditions set forth in the documents
evidencing the Purchased Securities Transaction shall have been satisfied and
the Purchased Securities Transaction shall be consummated in accordance with its
terms;

                  (d) The Obligors shall have received all licenses, approvals,
or consents necessary to consummate the Purchased Securities Transaction;

                  (e) The representations and warranties in this letter
agreement, the Pledge Agreement, the Trust Agreement, and the 2003 Fee Letter

<PAGE>

shall be true and correct in all material respects as of the date hereof, as
though made on such date (except to the extent that such representations and
warranties relate solely to an earlier date);

                  (f) No Event of Default under the Pledge Agreement and no
Event of Default under and as defined in the Loan Agreement shall have occurred
and be continuing on the date hereof, nor shall result from the consummation of
the transactions contemplated herein;

                  (g) No injunction, writ, restraining order, or other order of
any nature prohibiting, directly or indirectly, the consummation of the
transactions contemplated herein shall have been issued and remain in force by
any governmental authority against any of the Obligors, Patriot, Clearwing, any
of their affiliates, or any other Person;

                  (h) The Obligors shall have paid Clearwing, for the benefit of
Clearwing, the Lender, and their affiliates, a work fee in an amount equal to
$500,000, which amount (i) shall be in addition to all other work fees and all
expense deposits paid by any of the Obligors to Clearwing or the Lender, (ii)
shall be applied to the payment of costs and expenses incurred at any time by
Clearwing and its affiliates in connection with the Patriot Financing or any
other financing in favor of any of the Obligors, and (iii) shall be paid as
follows: (x) $200,000 of such work fee shall be paid on the date of execution of
this letter agreement, and (y) the remaining $300,000 of such work fee shall be
paid on the date of the initial funding of the Purchased Securities Transaction.

                  (i) Clearwing shall have received the fees set forth in the
2003 Fee Letter, as amended by Paragraph 4 of this letter agreement;

                  (j) Clearwing shall have received an opinion from counsel for
Trust 2003-1 in form and substance satisfactory to Clearwing;

                  (k) Clearwing shall have received the consent, if necessary or
appropriate, from the Pledgee Lender (as defined in the Loan Agreement); and

                  (l) The Lender shall have (i) consummated an amendment to the
Loan Agreement, which increases the advance rate on Eligible Mortgage Loans to
an advance rate satisfactory to the Lender and the Borrower, and (ii) received
the consent of the Pledgee Lender (as defined in the Loan Agreement) to such
amendment.

                  4. Amendments to 2003 Fee Letter and Loan Agreement. Each
capitalized term used solely in this Paragraph 4 and not otherwise defined in
this letter agreement shall have the meaning ascribed to such term in the 2003
Fee Letter. As consideration for Clearwing's consent as provided herein and
effective upon the date of execution of the documents evidencing the Purchased
Securities Transaction (the "Patriot Closing Date"), the Obligors, jointly and
severally, and Clearwing agree to the following amendments to the 2003 Fee
Letter and the Loan Agreement:

                  (a) The expiration date of the Commitment Transaction Fee set
forth in Section 4(b) of the 2003 Fee Letter shall be extended from January 11,
2005 to and including September 30, 2006;
<PAGE>

                  (b) Subject to the amendment set forth in Section 4(c) below,
the definition of "Maximum Credit" as set forth in the Loan Agreement shall be
amended and restated to read as follows:

                        "Maximum Credit" means $250,000,000, provided, however,
              that the amount of the Maximum Credit may, in the sole discretion
              of the Lender at any time after the first anniversary of the
              Closing Date up November 30, 2005, be increased to at least
              $400,000,000, provided further, however, that the Company shall
              have the right to terminate the option of the Lender to so
              increase the amount of the Maximum Credit so long as (i) the
              Company and the Lender agree in writing to terminate such option,
              and (ii) the Increase Option Termination Fee (as defined in the
              Fee Letter) is paid to Clearwing pursuant to the terms of the Fee
              Letter.

                  (c) Section 5 of the 2003 Fee Letter shall be amended and
restated to read as follows:

                           "5. Increase Commitment Fees. If the Maximum Credit
                  is increased to at least $400,000,000 at the sole discretion
                  of Clearwing (the date of such increase, the "Increase Date"),
                  the Obligors shall pay to Clearwing the following fees:

                           a. Increase Commitment Exercise Fee. A commitment
                  exercise fee (the "Increase Commitment Exercise Fee") of
                  $10,000,000, which shall be fully earned on the Increase Date,
                  nonrefundable when paid, and due and payable in equal monthly
                  installments on the first day of each month commencing with
                  the first day of the first full month following the Increase
                  Date and continuing until all Obligations have been paid in
                  full, with any remaining balance due and payable on the
                  Termination Date, provided, however, that if the Increase Date
                  is on or after June 30, 2005, the Increase Commitment Exercise
                  Fee shall be reduced by an amount equal to (i) $250,000, times
                  (ii) the total number of full months that exist during the
                  period from June 30, 2005 through and including the Increase
                  Date.

                           b. Increase Credit Support Fee. An increase credit
                  support fee of $1,350,000, which fee shall be fully earned and
                  due and payable on the Termination Date, and nonrefundable
                  when paid.

                           c. Increase Loan Commitment Fee. An increase loan
                  commitment fee of $10,500,000, which fee shall be fully earned
                  and due and payable on the Increase Date, and nonrefundable
                  when paid, and shall be payable in advance in 24 equal monthly
                  installments of $437,500 each, payable on the first day of
                  each calendar month from and after the Increase Date through

<PAGE>

                  the date on which all of the Obligations are paid in full in
                  accordance with the terms of the Loan Agreement, and the
                  commitments of the Lender under the Loan Agreement are
                  terminated, provided, however, that (a) the increase loan
                  commitment fee that is due in advance for the period from the
                  Increase Date through the last day of the calendar month in
                  which the Increase Date falls shall be due and payable on the
                  Increase Date and shall be an amount equal to (i) $437,500,
                  times (ii) the result of the total number of days that will
                  elapse from (and including) the Increase Date through the last
                  day of the calendar month in which the Increase Date falls
                  divided by the total number of days in such month, and (b) on
                  the Termination Date, the Obligors shall pay an amount
                  necessary to pay in full the remaining balance of the increase
                  loan commitment fee, provided further, however, that if the
                  Increase Date is on or after June 30, 2005, the Increase Loan
                  Commitment Fee shall be reduced by an amount equal to (i)
                  $437,500, times (ii) the total number of full months that
                  exist during the period from June 30, 2005 through and
                  including the Increase Date.

                           d. Increase Option Termination Fee. The Increase
                  Option Termination Fee (as referenced in the definition of
                  Maximum Credit Amount in the Loan Agreement) shall be an
                  amount equal to (i) $7,500,000 plus (ii) an amount equal to
                  $500,000 times each month during the term of the Loan
                  Agreement that the Maximum Credit was not increased to at
                  least $400,000,000."

                  (d) The unpaid balance of the Loan Commitment Fee set forth in
Paragraph 2 of the 2003 Fee Letter shall be accelerated such that (i) $2,000,000
of such unpaid balance shall be due and payable on the Patriot Closing Date, and
(ii) the balance remaining after payment of such $2,000,000 shall be paid in
equal monthly of $1,000,000 on the first day of each month commencing with the
first day of the first full month following the Patriot Closing Date until the
Loan Commitment Fee is paid in full.

                  (e) The following new Paragraph 10 shall be added to the Fee
Letter:

                           10. Evergreen Expense Deposit. From and after October
                  26, 2004 through and including the date that all Obligations
                  have been paid in full in accordance with the terms of the
                  Loan Agreement, the Obligors shall maintain at all times a
                  $100,000 expense deposit with Clearwing, for the benefit of
                  Clearwing, the Lender, and their affiliats.

                  5. Limited Consent. The consent provided in this letter
agreement shall be limited precisely as provided for herein, and shall not be
deemed to be a waiver of, amendment of, consent to or modification of any other
term, provision or Event of Default under Loan Agreement, the Pledge Agreement
or of any term or provision of any other Loan Document or other instrument

<PAGE>

referred to therein or herein or of any transaction or further or future action
on the part of the Borrower or Trust 2003-1 which would require the consent of
the Lender or Clearwing under the Loan Agreement or the Pledge Agreement.

                  6. Reservation of Rights. You are hereby advised that the
Lender and Clearwing expressly reserve all of their respective rights and
remedies against the Borrower and Trust 2003-1 under the Loan Agreement, the
Pledge Agreement and the other Loan Documents and at law and in equity with
respect to all existing or future Events of Default. Neither the Lender nor
Clearwing shall be deemed to have waived any term or condition of the Loan
Agreement, the Pledge Agreement or any other Loan Document or to have agreed to
a forbearance with respect to any right or remedy which the Lender or Clearwing
may now have or in the future may have under the Loan Agreement, the Pledge
Agreement or any other Loan Document, at law, in equity or otherwise on account
of any Default or Events of Default. Neither the Lender nor Clearwing shall by
virtue of any action or omission be deemed to have altered or prejudiced any
rights or remedies under or in connection with the Loan Agreement, the Pledge
Agreement or under or in connection with any Default under the Loan Documents
except as specifically set forth herein. All of the terms and conditions of the
Loan Agreement and the other Loan Documents are and shall remain in full force
and effect.

                  7. Miscellaneous

                           (a) This letter agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which shall be deemed to be an original but all of which taken together
shall constitute one and the same agreement. Delivery of an executed counterpart
of this letter agreement by facsimile or electronic mail shall be equally
effective as delivery of a manually executed counterpart.

                           (b) Section and paragraph headings herein are
included for convenience of reference only and shall not constitute a part of
this letter agreement for any other purpose.

                            [Signature Pages Follow]

<PAGE>

                           (c) THIS LETTER AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF NEW YORK.

                                     Very truly yours,

                                     CLEARWING CAPITAL, LLC

                                     By: Chrysalis Capital Partners, LLC,
                                         Its Manager

                                     By:  /s/ Gregory L. Segall
                                        ---------------------------------
                                     Name:  Gregory L. Segall
                                     Its:  Managing Member

<PAGE>

Accepted and Agreed to this th day of November 2004:

ABFS WAREHOUSE TRUST 2003-2

By:      /s/  Jeffrey M. Ruben
       --------------------------------------------
       Name:  Jeffrey M. Ruben
       Title: Executive Vice President

ABFS WAREHOUSE TRUST 2003-1

By:      /s/  Jeffrey M. Ruben
       --------------------------------------------
       Name:  Jeffrey M. Ruben
       Title: Executive Vice President

AMERICAN BUSINESS FINANCIAL SERVICES, INC.

By:      /s/  Jeffrey M. Ruben
       --------------------------------------------
       Name:  Jeffrey M. Ruben
       Title: Executive Vice President

ABFS CONSOLIDATED HOLDINGS, INC.

By:      /s/  Jeffrey M. Ruben
       --------------------------------------------
       Name:  Jeffrey M. Ruben
       Title: Executive Vice President

AMERICAN BUSINESS CREDIT, INC.

By:      /s/  Jeffrey M. Ruben
       --------------------------------------------
       Name:  Jeffrey M. Ruben
       Title: Executive Vice President

AMERICAN BUSINESS MORTGAGE SERVICES, INC.

By:      /s/  Jeffrey M. Ruben
       --------------------------------------------
       Name:  Jeffrey M. Ruben
       Title: Executive Vice President

HOMEAMERICAN CREDIT, INC.,
D/B/A UPLAND MORTGAGE

By:      /s/  Jeffrey M. Ruben
       --------------------------------------------
       Name:  Jeffrey M. Ruben
       Title: Executive Vice President

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00074-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00074-of-00352.parquet"}]]