Document:

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                                                                   EXHIBIT 10.48

                               SERVICING AGREEMENT

                                      among

                          WFS RECEIVABLES CORPORATION 2

                                       and

                                WFS FINANCIAL INC

                           Dated as of August 20, 2004

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      This SERVICING AGREEMENT, dated as of August 20, 2004 , is among WFS
Financial Inc (the "Servicer") and WFS Receivables Corporation 2 ("WFSRC2" ).

      WHEREAS, WFSRC2 acquires portfolios of receivables arising in connection
with automobile retail installment sales contracts and installment loans
primarily originated by motor vehicle dealers from time to time; and desires to
have them serviced by Servicer ;

      WHEREAS, the Servicer is willing to service such receivables pursuant to
the terms hereof.

      NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto agree as follows:

                                   ARTICLE ONE

                                   DEFINITIONS

      Section 1.01. Definitions. Whenever used in this Agreement, the following
words and phrases, unless the context otherwise requires, shall have the
following meanings:

      "Affiliate" of any specified Person means any other Person controlling or
controlled by or under common control with such specified Person. For the
purposes of this definition, "control" when used with respect to any specified
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" or "controlled" have meanings
correlative to the foregoing.

      "Bank" means Western Financial Bank, a federal savings bank.

      "Business Day" means any day that is not a Saturday, Sunday or other day
on which banking institutions in Los Angeles, California, are authorized or
obligated by law, executive order or government decree to remain closed.

      "Closing Date" means each such date as specified in the Schedule(s)
attached hereto.

      "Collection Account" means the bank account or general ledger account
established and maintained as such pursuant to Section 4.01.

      "Contract" means each retail installment sales contract and security
agreement or installment loan agreement and security agreement which has been
executed by an Obligor and pursuant to which such Obligor purchased, financed or
pledged the Financed Vehicle described therein, agreed to pay the deferred
purchase price (i.e., the purchase price net of any down payment) or amount
borrowed, together with interest, as therein provided in connection with such
purchase or loan, granted a security interest in such Financed Vehicle, and
undertook to

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perform certain other obligations as specified in such Contract and which has
been conveyed to WFSRC2 pursuant to this Agreement.

      "Contract Documents" means, with respect to each Contract, (i) the
original of the Contract; (ii) either the original Title Document for the
related Financed Vehicle or a duplicate copy thereof issued or certified by the
Registrar of Titles which issued the original thereof, together with evidence of
perfection of the security interest in the related Financed Vehicle granted by
such Contract, as determined by the Servicer to be permitted or required to
perfect such security interest under the laws of the applicable jurisdiction ;
(iii) any agreements modifying the Contract (including, without limitation, any
extension agreements); and (iv) documents evidencing the existence of physical
damage insurance covering such Financed Vehicle.

      "Contract Files" means the Contract Documents and all other papers and
computerized records customarily kept by the Servicer in servicing contracts and
loans comparable to the Contracts.

      "Distribution Date" means the calendar day specified by the Servicer,
which shall be no later than the 15th calendar day of each month or, if any such
date shall not be a Business Day, the next succeeding Business Day.

      "Due Period" means, with respect to any Distribution Date, the one-month
period commencing on the first day of the first month preceding the month in
which such Distribution Date occurs (or from the Closing Date in the case of the
first Distribution Date) to the last day of the month immediately preceding the
month in which such Distribution Date occurs.

      "Financed Vehicle" means, as to any Contract, an automobile or light-duty
truck, together with all accessions thereto, securing the related Obligor's
indebtedness under such Contract.

      "Insolvency Event" means, with respect to a specified Person, (i) the
entry of a decree or order for relief by a court or regulatory authority having
jurisdiction in respect of such Person in an involuntary case under the federal
bankruptcy laws, as now or hereafter in effect, or any other present or future,
federal or state, bankruptcy, insolvency or similar law, or appointing a
receiver, liquidator, assignee, custodian, trustee, sequestrator or other
similar official for such Person or for any substantial part of its property, or
ordering the winding-up or liquidation of such Person's affairs, and the
continuance of any such decree or order unstayed and in effect for a period of
60 consecutive days; (ii) the commencement of an involuntary case under the
federal bankruptcy laws, as now or hereinafter in effect, or any other present
or future federal or state bankruptcy, insolvency or similar law and such case
is not dismissed within 60 days; or (iii) the commencement by such Person of a
voluntary case under the federal bankruptcy laws, as now or hereinafter in
effect, or any other present or future federal or state, bankruptcy, insolvency
or similar law, or the consent by such Person to the appointment of or taking
possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator
or other similar official for such Person or for any substantial part of its
property, or the making by such Person of an assignment for the benefit of
creditors or the failure by such Person generally to pay its debts as such debts
become due or the taking of corporate action by such Person in furtherance of
any the foregoing.

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      "Insurance Policy" means, with respect to a Financed Vehicle, the policies
of comprehensive and collision insurance and the LDI Policy.

      "Insurance Proceeds" means proceeds paid pursuant to any Insurance Policy
and amounts (exclusive of rebated premiums) paid by any insurer under any other
insurance policy related to a Financed Vehicle, a Contract or an Obligor.

      "LDI Policy" means the limited dual interest policy providing coverage for
physical damage to, or loss of, a Financed Vehicle.

      "Maturity Date" means, with respect to any Contract, the date on which the
last scheduled payment of such Contract shall be due and payable (after giving
effect to all Prepayments received prior to the date of determination) as such
date may be extended pursuant to Section 3.02.

      "Monthly P&I" means, with respect to any Contract, the amount of each
monthly installment of principal and interest payable to the Person to whom the
Obligor is indebted under such Contract in accordance with the terms thereof,
exclusive of any charges allocable to the financing of any insurance premium and
charges which represent late payment charges or extension fees.

"Net Collections" means, with respect to any Distribution Date and the related
Due Period, all amounts collected on or in respect of the Contracts during such
Due Period, including, Monthly P&I, and Insurance Proceeds (only to the extent
of the related Net Insurance Proceeds), less any amount retained by the Servicer
as compensation pursuant to Section 3.07.

      "Net Insurance Proceeds" means, with respect to any Contract, Insurance
Proceeds net of any such amount applied to the repair of the related Financed
Vehicle, released to the related Obligor in accordance with the normal servicing
procedures of the Servicer or representing expenses incurred by the Servicer and
recoverable hereunder.

      "Obligor" on a Contract means purchaser or co-purchasers of the Financed
Vehicle and any other Person who owes payments under the Contract.

      "Outstanding" means a Contract that has not reached its Maturity Date, has
not been fully prepaid or has not been repurchased pursuant to Section 3.06.

      "Person" means a legal person, including any individual, corporation,
limited liability company, estate, partnership, joint venture, association,
joint stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof.

      "Prepayment" means any of the following: (i) payment to the Servicer of
100% of the outstanding Principal Balance of a Contract together with all
accrued and unpaid interest thereon to the date of such payment, or (ii) payment
by the Servicer, of the purchase price of a Contract in connection with the
purchase of a Contract pursuant to Section 3.06.

      "Principal Balance" means with respect to a Contract that is a (i) Rule of
78's Contract, the total outstanding amount of Monthly P&I, less any unearned
interest, as of the date the

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Principal Balance is calculated and (ii) Simple Interest Contract, the actual
principal balance under the terms thereof.

      "Registrar of Titles" means the agency, department or office having the
responsibility for maintaining records of titles to motor vehicles and issuing
documents evidencing such titles in the jurisdiction in which a particular
Financed Vehicle is registered.

      "Rule of 78's Contract" means a Contract as to which payments thereunder
are applied on the basis of the Rule of 78's.

      "Schedule of Contracts" means the list or lists of Contracts described in
each Schedule(s) which Schedule(s) are incorporated by reference to to this
Agreement. Each such Schedule of Contracts shall be in such medium as stated
herein and (i.e., paper, disk, tape, etc.) shall reflect the Contracts that are
being acquired by WFSRC2 and shall set forth the following information with
respect to each such Contract in numbered columns:

<TABLE>
<CAPTION>
                        Information                              Column Number
                        -----------                              -------------
<S>                                                              <C>
Contract Number ("ACCT NBR")...........................              2
Date of Origination ("ORG DT").........................              9
Maturity Date ("MAT DT")...............................             15
Monthly P&I ("P&I")....................................             10
Original Principal Balance ("ORIG AMT")................             16 Top
Principal Balance ("PRIN BAL").........................             16 Bottom
Discount Rate ("APR")..................................              7
</TABLE>

      "Servicer" means WFS Financial Inc in its capacity as the Servicer of the
Contracts under Section 3.01, and, in each case upon succession in accordance
herewith, each successor servicer in the same capacity pursuant to Section 3.01
and each successor Servicer pursuant to Section 6.02.

      "Servicer Default" means an event specified in Section 6.01.

      "Servicing Fee" means, as to any Distribution Date, the aggregate amount
calculated in respect to the Servicing Fee for each month in the related Due
Period, which for each such month shall equal the product of one-twelfth of the
Servicing Fee Percent and the aggregate of the Principal Balances of the
Contracts Outstanding as of the first day of such month or, in the case of the
first month of the first Due Period, the Closing Date. The Servicing Fee
attributable to the first month in the first Due Period will be prorated based
on the number of days from the Closing Date to the last day of such month.

      "Servicing Fee Percent" means 1.25% per annum.

      "Simple Interest Contract" means a Contract as to which interest is
calculated each day on the basis of the actual principal balance of such
Contract on such day.

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      "Title Document" means, with respect to any Financed Vehicle, the
certificate of title for, or other evidence of ownership of, such Financed
Vehicle issued by the Registrar of Titles in the jurisdiction in which such
Financed Vehicle is registered.

      "UCC" means the Uniform Commercial Code as in effect in the applicable
jurisdiction.

      "United States" means the United States of America.

      Section 1.02. Usage of Terms. With respect to all terms in this Agreement,
the singular includes the plural and the plural the singular; words importing
any gender include the other genders; references to "writing" include printing,
typing, lithography and other means of reproducing words in a visible form;
references to agreements and other contractual instruments include all
amendments, modifications and supplements thereto or any changes therein entered
into in accordance with their respective terms and not prohibited by this
Agreement; references to Persons include their permitted successors and assigns;
and the term "including" means "including without limitation."

      Section 1.03. Section References. All Section references, unless otherwise
indicated, shall be to Sections in this Agreement.

      Section 1.04. Accounting Terms. All accounting terms used but not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles in the United States.

                                   ARTICLE TWO

                                 CONTRACT FILES

      Section 2.01 Custody of Contract Files.

      (a) Subject to Sections 2.04, 5.04 and 6.01, WFSRC2 hereby irrevocably
appoints the Servicer, and the Servicer hereby accepts such appointment, to act
as the agent of WFSRC2 as custodian of the Contract Documents. .

      (b) The Servicer shall cause the electronic record of the Contracts
maintained by it to be clearly marked to indicate that the Contracts are owned
by WFSRC2 and shall not in any way assert or claim an ownership interest in the
Contracts. It is intended by the Servicer's agreement pursuant to this Section
that WFSRC2 shall be deemed to have possession of the Contract Documents for
purposes of Section 9-313 of the UCC of the state in which the Contract
Documents are located.

      Section 2.02 Duties of Servicer as Custodian.

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      (a) Safekeeping. The Servicer shall hold the Contract Files on behalf of
WFSRC2, and maintain such accurate and complete accounts, records and computer
systems pertaining to each Contract File as shall enable WFSRC2 to comply with
this Agreement. In performing its duties as custodian, the Servicer shall act
with reasonable care, using that degree of skill and attention that the Servicer
exercises with respect to the files relating to all comparable automobile
contracts that the Servicer owns or services for itself or others. The Servicer
shall conduct, or cause to be conducted, periodic physical inspections of the
Contract Files held by it under this Agreement and of the related accounts,
records and computer systems, and shall maintain them in such a manner as shall
enable WFSRC2 to verify the accuracy of the Servicer's record keeping. The
Servicer shall promptly report to WFSRC2 any failure on its part to hold the
Contract Files and maintain its accounts, records and computer systems as herein
provided and shall promptly take appropriate action to remedy any such failure.

      (b) Maintenance of and Access to Records. The Servicer shall maintain each
Contract File at one of its offices specified in Attachment I hereto or at such
other location as shall be specified to WFSRC2 by 30 days' prior written notice.
The Servicer shall permit WFSRC2 or its respective duly authorized
representatives, attorneys or auditors to inspect the Contract Files and the
related accounts, records and computer systems maintained by the Servicer at
such times as such Persons may request.

      (c) Release of Documents. Upon instruction from WFSRC2, the Servicer shall
release any Contract File to WFSRC2, or WFSRC2's designee, as the case may be,
at such place or places as WFSRC2 may designate, as soon as practicable.

      Section 2.03 Instructions; Authority to Act. The Servicer shall be deemed
to have received proper instructions with respect to the Contract Files upon its
receipt of written instructions signed by an officer of WFSRC2.

      Section 2.04 Effective Period and Termination. The Servicer's appointment
as custodian shall become effective as of each such Closing Date and shall
continue in full force and effect until terminated under this Section. If the
Servicer shall resign in accordance with the provisions of this Agreement or if
all of the rights and obligations of the Servicer shall have been terminated
pursuant to Section 6.01, the appointment of the Servicer as custodian shall be
terminated by WFSRC2 pursuant to Section 6.01. As soon as practicable after any
termination of such appointment, the Servicer shall, at its own expense, deliver
the Contract Files to WFSRC2 or its agent at such place or places as WFSRC2 may
reasonably designate and shall cooperate in good faith to effect such delivery.

      Section 2.05 Nonpetition Covenant.

      (a) Servicer shall not petition or otherwise invoke the process of any
court or government authority for the purpose of commencing or sustaining a case
against WFSRC2 under any federal or state bankruptcy, insolvency or similar law
or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator
or other similar official of WFSRC2 or any substantial part of its property, or
ordering the winding up or liquidation of the affairs of WFSRC2.

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                                 ARTICLE THREE

                    ADMINISTRATION AND SERVICING OF CONTRACTS

      Section 3.01. Duties of Servicer. In consideration of WFSRC2's payment of
the Servicing Fee to the Servicer, shall, as agent for WFSRC2, manage, service,
administer and make collections on the Contracts. The Servicer agrees that its
servicing of the Contracts shall be carried out in accordance with customary and
usual procedures of financial institutions which service motor vehicle retail
installment sales contracts and installment loans and, to the extent more
exacting, the procedures used by the Servicer in respect of such contracts
serviced by it for its own account. In accordance with the foregoing, the
Servicer may, whenever an Obligor has become delinquent or the Servicer believes
an Obligor may become delinquent, in order to preserve the ultimate
collectability of amounts due on a Contract, modify the payment schedule on any
Contract by reducing the annual percentage rate on such Contract without the
consent of WFSRC2. In addition, the Servicer may reduce the principal amount of
a Contract (i.e., write-down a portion of the principal amount due on such
Contract and, accordingly, lower the Monthly P&I on such Contract). Any such
modifications or reductions exceeding a reasonable limit may be made only with
the consent of WFSRC2. The Servicer may also extend the Maturity Date on a
Contract in accordance with Section 3.02. The Servicer's duties shall include
collection and posting of all payments, responding to inquiries of Obligors on
the Contracts, investigating delinquencies, sending payment coupons to Obligors,
reporting tax information to Obligors, accounting for collections, furnishing
statements to WFSRC2 with respect to distributions for WFSRC2 on an annual
basis, based on a tax year for WFSRC2 that is the calendar year. The Servicer
shall have, subject to the terms hereof, full power and authority, acting alone,
and subject only to the specific requirements and prohibitions of this
Agreement, to do any and all things in connection with such managing, servicing,
administration and collection that it may deem necessary or desirable; provided,
however, that the Servicer shall commence repossession efforts in respect of any
Financed Vehicle respecting which the related Contract is four or more months
delinquent excluding any bankrupt accounts. Without limiting the generality of
the foregoing, but subject to the provisions of this Agreement, the Servicer is
authorized and empowered by WFSRC2 to execute and deliver, on behalf of itself
or WFSRC2 any and all instruments of satisfaction or cancellation, or of partial
or full release or discharge, and all other comparable instruments, with respect
to the Contracts or to the Financed Vehicles. WFSRC2 shall furnish the Servicer
all documents necessary or appropriate to enable the Servicer to carry out its
servicing and administrative duties hereunder.

      The Servicer shall deposit in or credit to the Collection Account within
two Business Days of receipt all collections of Monthly P&I received on or after
the Closing Date on or in respect of the Contracts together with the proceeds of
all Prepayments and any accompanying interest. The foregoing requirement for
deposit in the Collection Account are exclusive, it being understood that
collections in the nature of late payment charges or extension fees or
collections allocable to payments to be made by the Servicer on behalf of
Obligors for payment of insurance premiums or similar items need not be
deposited in the Collection Account and may be retained by the Servicer as
additional servicing compensation or for application on behalf of Obligors, as
the case may be.

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      With respect to payments of Monthly P&I made by Obligors to the Servicer's
lock box, the Servicer shall direct the Person maintaining the lock box to
deposit the amount collected on or in respect of the Contracts to the Collection
Account.

      In order to facilitate the servicing of the Contracts by the Servicer, the
Servicer shall retain, subject to and only to the extent permitted by the
provisions of this Agreement, all collections on or in respect of the Contracts
prior to the time they are remitted or credited, in accordance with such
provisions, to the Collection Account, as the case may be. The Servicer
acknowledges that the unremitted collections on the Contracts are the property
of WFSRC2, and the Servicer agrees to act as custodian and bailee of WFSRC2 in
holding such monies and collections.

      The Servicer shall retain all data (including, without limitation,
computerized records) relating directly to or maintained in connection with the
servicing of the Contracts at the address of the Servicer set forth as
Attachment I to this Agreement or, upon 15 days' notice to WFSRC2, at such other
place where the servicing offices of the Servicer are located, and shall give
WFSRC2 access to all data at all reasonable times. While a Servicer Default
shall be continuing, the Servicer shall, on demand of WFSRC2, deliver or cause
to be delivered to WFSRC2 all data (including, without limitation, computerized
records and, to the extent transferable, related operating software) necessary
for the servicing of the Contracts and all monies collected by it and required
to be deposited in or credited to the Collection Account.

      Section 3.02. Collection of Contract Payments. The Servicer shall use its
best efforts to collect all payments called for under the terms and provisions
of the Contracts as and when the same shall become due and shall use its best
efforts to cause each Obligor to make all payments in respect of his or her
Contract to the Servicer. Consistent with the foregoing, the Servicer may in its
discretion (i) waive any late payment charges in connection with delinquent
payments on a Contract or prepayment charges and (ii) in order to work out a
default or an impending default due to the financial condition of the Obligor,
modify the payment schedule of a Contract that is 60 days or more delinquent or
extend the Maturity Date of such delinquent Contract by up to 90 days in the
aggregate past the originally scheduled date of the last payment on such
Contract.

      Section 3.03. Insurance. To the extent the Obligor fails to maintain a
comprehensive and collision insurance policy in an amount at least equal to the
lesser of (i) the actual cash value of the Financed Vehicle or (ii) the
Principal Balance due under the related Contract, the Servicer shall exercise
best efforts to obtain the LDI Policy in respect of such Financed Vehicle;
provided, however, that the Servicer shall not be required to maintain such
insurance in respect of any Financed Vehicle as to which the related Contract
has an unpaid Principal Balance of less than $4,000 or the related Contract has
six or fewer months remaining before its Maturity Date.

      Section 3.04. Maintenance of Security Interests in Financed Vehicles. The
Servicer shall take such steps as are necessary to maintain continuous
perfection and priority of the security interest created by each Contract in the
related Financed Vehicle, including but not limited to, obtaining the execution
by the Obligors and the recording, registering, filing, re-recording,
re-registering and refiling of all security agreements, financing statements,
continuation statements or other instruments as are necessary to maintain the
security interest granted by Obligors under the respective Contracts. WFSRC2
hereby authorizes the Servicer to take such

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steps as are necessary to re-perfect such security interest on behalf of WFSRC2
in the event of the relocation of a Financed Vehicle or for any other reason.

      Section 3.05. Covenants, Representations and Warranties of the Servicer.
The Servicer hereby makes the following covenants, representations and
warranties on which WFSRC2 is deemed to have relied in acquiring the Contracts.
Such covenants, representations and warranties speak as of the execution and
delivery of this Agreement and as of each Closing Date.

            (a) The Servicer covenants as to the Contracts:

                  (i) Lien in Force. The Financed Vehicle securing each Contract
            shall not be released from the lien granted by the Contract in whole
            or in part, except as contemplated herein.

                  (ii) Impairment. The Servicer shall not impair the rights of
            WFSRC2 in the Contracts.

                  (iii) Amendments. The Servicer shall not amend the terms of
            any Contract, except that extensions or modifications may be granted
            in accordance with Section 3.02.

                  (iv) Transfers. The Servicer may consent to the sale or
            transfer by an Obligor of any Financed Vehicle if the original
            Obligor under the related Contract remains liable under such
            Contract and the transferee assumes all of the Obligor's obligations
            thereunder.

            (b) The Servicer represents, warrants and covenants:

                  (i) Organization and Good Standing. The Servicer (A) has been
            duly organized and is validly existing as a corporation in good
            standing under the laws of the state of its incorporation, (B) has
            qualified to do business as a foreign corporation and is in good
            standing in each jurisdiction where the character of its properties
            or the nature of its activities makes such qualification necessary,
            and (C) has full power, authority and legal right to own its
            property, to carry on its business as presently conducted and to
            enter into and perform its obligations under this Agreement.

                  (ii) Power and Authority. The execution and delivery by the
            Servicer of this Agreement are within the corporate power of the
            Servicer and have been duly authorized by all necessary corporate
            action on the part of the Servicer. Neither the execution and
            delivery of this Agreement, nor the consummation of the transactions
            herein contemplated, nor compliance with the provisions hereof, will
            conflict with or result in a breach of, or constitute a default
            under, any of the provisions of any law, governmental rule,
            regulation, judgment, decree or order binding on the Servicer or its
            properties or the articles of incorporation or bylaws of the
            Servicer, or any of the provisions of any indenture, mortgage,
            contract or other instrument to which the Servicer is a party or by
            which it is bound or result in the creation or imposition of any
            lien, charge or encumbrance upon any of its

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            property pursuant to the terms of any such indenture, mortgage,
            contract or other instrument.

                  (iii) Governmental Consents. The Servicer is not required to
            obtain the consent of any other party or consent, license, approval
            or authorization, or registration or declaration with, any
            governmental authority, bureau or agency in connection with the
            execution, delivery, performance, validity or enforceability of this
            Agreement, except (in each case) such as have been obtained and are
            in full force and effect.

                  (iv) Binding Obligation. This Agreement has been duly executed
            and delivered by the Servicer and, assuming the due authorization,
            execution and delivery thereof by WFSRC2 constitutes a legal, valid
            and binding instrument enforceable against the Servicer in
            accordance with its terms (subject to applicable bankruptcy and
            insolvency laws and other similar laws affecting the enforcement of
            creditors' rights generally).

                  (v) No Proceedings. There are no actions, suits or proceedings
            pending or, to the knowledge of the Servicer, threatened against or
            affecting the Servicer, before or by any court, administrative
            agency, arbitrator or governmental body with respect to any of the
            transactions contemplated by this Agreement, or which will, if
            determined adversely to the Servicer, materially and adversely
            affect it or its business, assets, operations or condition,
            financial or otherwise, or adversely affect the Servicer's ability
            to perform its obligations hereunder. The Servicer is not in default
            with respect to any order of any court, administrative agency,
            arbitrator or governmental body so as to materially and adversely
            affect the transactions contemplated by the above-mentioned
            documents.

                  (vi) Other Consents. The Servicer has obtained or made all
            necessary consents, approvals, waivers and notifications of
            creditors, lessors and other nongovernmental persons, in each case
            in connection with the execution and delivery of, and the
            consummation of the transactions contemplated by, this Agreement.

      Section 3.06. Replacement of Servicer upon Breach of Covenant. The
Servicer or WFSRC2 shall inform the other party promptly, in writing, upon the
discovery of any breach pursuant to Section 3.02, 3.04 or 3.05. Unless the
breach shall have been cured within 30 days following such discovery, WFSRC2
shall have the right, in its sole discretion, to replace Servicer and
immediately terminate this Agreement. Servicer shall further indemnify WFSRC2
against all costs, expenses, losses, damages, claims and liabilities, including
reasonable fees and expenses of counsel, which may be asserted against or
incurred by any of them as a result of third-party claims arising out of the
events or facts giving rise to such breach.

      Section 3.07. Servicing Compensation. As compensation for the performance
of its obligations under this Agreement and subject to the terms of this
Section, the Servicer shall be entitled to receive on each Distribution Date the
Servicing Fee. As servicing compensation in

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addition to the Servicing Fee, the Servicer shall be entitled to retain all late
payment charges, extension fees and similar items paid in respect of Contracts.
The Servicer shall pay all expenses incurred by it in connection with its
servicing activities hereunder and shall not be entitled to reimbursement of
such expenses.

      Section 3.08. Reporting by the Servicer.

      (a) Upon the request of WFSRC2, but no more than once a month, the
Servicer shall transmit to WFSRC2 a statement including any of the following
information as requested by WFSRC2:

            (i) the Net Collections for a specified Distribution Date;

            (ii) the Servicing Fee with respect to the related Due Period;

            (iii) the aggregate amount, if any, paid by or due from it for the
      purchase of Contracts which the Servicer has become obligated to purchase
      pursuant to Section 3.06;

            (iv) the net amount of funds which have been deposited in or
      credited to the Collection Account in respect of such Due Period after
      giving effect to all permitted deductions therefrom pursuant to Section
      4.02; and

any other information relating to the Contracts reasonably requested by WFSRC2.

      Section 3.09. Access to Certain Documentation and Information Regarding
Contracts. The Servicer shall provide to WFSRC2 access to the Contract Files.
Access shall be afforded without charge, but only upon reasonable request and
during the normal business hours at the designated offices of the Servicer.
Nothing in this Section shall affect the obligation of the Servicer to observe
any applicable law prohibiting disclosure of information regarding the Obligors
and the failure of the Servicer to provide access to information as a result of
such obligation shall not constitute a breach of this Section.

      Section 3.10. Fidelity Bond. The Servicer shall maintain a fidelity bond
in such form and amount as is customary for banks acting as custodian of funds
and documents in respect of mortgage loans or consumer contracts on behalf of
institutional investors.

                                  ARTICLE FOUR

                        COLLECTION ACCOUNT; DISTRIBUTIONS

      Section 4.01. Establishment of Collection Accounts.

      (a) Prior to the Closing Date, the Servicer shall open an account, which
may be with the Servicer or the Bank, in the name of WFSRC2 (the "Collection
Account"), bearing a designation clearly indicating that the funds deposited in
or credited to such account are held for the benefit of WFSRC2. The Collection
Account shall relate solely to the Contracts. The Servicer shall give WFSRC2 at
least five Business Days' written notice of any change in the location of the

                                       11
<PAGE>

Collection Account and any related account identification information. All
monies deposited in or credited to, from time to time, the Collection Account
shall be the property of WFSRC2.

      (b) WFSRC2 shall possess all right, title and interest in all funds on
deposit from time to time in the Collection Account and in all proceeds thereof
(including all income thereon) and all such funds, investments, proceeds and
income shall be property of WFSRC2. The Servicer shall have the power, revocable
by WFSRC2, to make withdrawals and payments from the Collection Account for the
purpose of permitting the Servicer to carry out its duties hereunder.

      Section 4.02. Collections; Net Deposits. Subject to Section 4.03, the
Servicer shall remit or credit all payments by the Obligors on the Contracts,
all payments on behalf of Obligors on the Contracts and all Net Insurance
Proceeds to the Collection Account (within two Business Days as specified in
Section 3.01). So long as WFS Financial Inc is the Servicer, the Servicer shall
have the right, on a basis not more frequently than once per month (although
deposits shall be made into the Collection Account within two Business Days
pursuant to Section 3.01), to deduct from amounts received that are otherwise
required to be deposited in or credited to the Collection Account and, to the
extent such amounts are insufficient, to withdraw and deliver to it from the
Collection Account, amounts due to be paid hereunder to the Servicer after
giving effect to application of the payment priorities specified in this Article
for the month (or other applicable period), and to pay such amounts to itself as
Servicer. Notwithstanding the foregoing, the Servicer shall maintain the records
and accounts for such deposits and credits on a gross basis.

      Section 4.03 . Application of Collections. On or prior to the last day of
each calendar month, all collections for the related month shall be applied by
the Servicer as follows: with respect to each Contract, payments by or on behalf
of an Obligor shall be applied first to late payment and extension fees, second
to interest accrued on the Contract, third to principal due on the Contract and
fourth to administrative charges, if any. Any excess shall be applied to prepay
the Principal Balance of the Contract.

      Section 4.04 Distributions. On each Distribution Date, the Servicer shall
make the following deposits and distributions to the extent of the Net
Collections for such Distribution Date, in the following amounts and order of
priority: (i) to the Servicer, the Servicing Fee, including any unpaid Servicing
Fees with respect to one or more prior Due Periods; and (ii) to WFSRC2, the
balance of the Net Collection after giving effect to the reduction in Net
Collections described in the preceding clause (i).

                                  ARTICLE FIVE
                                  THE SERVICER

      5.01 Liability of Servicer; Indemnities. Subject to Section 6.02, the
Servicer shall be liable in accordance herewith only to the extent of the
obligations specifically undertaken by the Servicer under this Agreement. Such
obligations shall include the following:

            (a) The Servicer shall indemnify, defend and hold harmless WFSRC2
from and against any and all costs, expenses, losses, damages, claims and
liabilities, arising out of or

                                       12
<PAGE>

resulting from the use, ownership or operation by the Servicer, or any of its
Affiliates of a Financed Vehicle.

            (b) The Servicer shall indemnify, defend and hold harmless WFSRC2
from and against any taxes that may at any time be asserted against WFSRC2 with
respect to the transactions contemplated herein, including, without limitation,
any sales, gross receipts, general corporation, tangible personal property,
privilege or license taxes but not including any taxes asserted with respect to,
and as of the date of, the sale of the Contracts to WFSRC2 or ownership of the
Contracts, and costs and expenses in defending against the same.

            (c) The Servicer shall indemnify, defend and hold harmless WFSRC2
from and against any and all costs, expenses, losses, claims, damages and
liabilities to the extent that such cost, expense, loss, claim, damage or
liability arose out of, or was imposed upon any such Person through, the
negligence, willful misfeasance or bad faith of the Servicer in the performance
of its duties under this Agreement or by reason of reckless disregard of its
obligations and duties under this Agreement.

            (d) The Servicer shall indemnify, defend and hold harmless WFSRC2
from and against any and all costs, expenses, losses, claims, damages and
liabilities arising out of or incurred in connection with the acceptance or
performance of the trusts and duties herein contained, except to the extent that
such cost, expense, loss, claim, damage or liability (i) shall be due to the
willful misfeasance, bad faith or negligence (except for errors in judgment) of
WFSRC2; (ii) relates to any tax other than the taxes with respect to which
Servicer shall be required to indemnify WFSRC2; or (iii) shall arise from
WFSRC2's breach of any of their respective representations or warranties set
forth herein.

      The Servicer shall immediately notify WFSRC2 if a claim is made by a third
party with respect to the Contracts, shall assume, with the consent of WFSRC2,
the defense of any such claim, pay all expenses in connection therewith,
including counsel fees, and shall promptly pay, discharge and satisfy any
judgment or decree which may be entered against it. Indemnification under this
Section shall survive the termination of this Agreement and shall include,
without limitation, reasonable fees and expenses of counsel and expenses of
litigation. If the Servicer shall have made any indemnity payments pursuant to
this Section and the Person to or on behalf of whom such payments are made
thereafter collects any of such amounts from others, such Person shall promptly
repay such amounts to the Servicer, without interest.

      Section 5.02. Corporate Existence; Status as Servicer; Merger. The
Servicer shall not consolidate with or merge into any other corporation or
convey, transfer or lease all or substantially all of its assets as an entirety
to any Person unless the corporation formed by such consolidation or into which
the Servicer has merged or the Person which acquires by conveyance, transfer or
lease substantially all the assets of the Servicer as an entirety can lawfully
perform the obligations of the Servicer hereunder and executes and delivers to
WFSRC2 an agreement in form and substance reasonably satisfactory to WFSRC2,
which contains an assumption by such successor entity of the due and punctual
performance or observance of each covenant and condition to be performed or
observed by the Servicer under this Agreement.

                                       13
<PAGE>

      Section 5.03. Performance of Obligations. The Servicer shall punctually
perform and observe all of its obligations and agreements contained in this
Agreement. The Servicer shall not take any action, or permit any action to be
taken by others, which would excuse any person from any of its covenants or
obligations under any of the Contract Documents, or which would result in the
amendment, hypothecation, subordination, termination or discharge of, or impair
the validity or effectiveness of, any of the Contract Documents or any such
instrument, except as expressly provided herein and therein.

      Section 5.04. Servicer Not to Resign; Assignment.

      (a) The Servicer shall not resign from the duties and obligations hereby
imposed on it except upon determination by its board of directors that by reason
of change in applicable legal requirements the continued performance by the
Servicer of its duties hereunder would cause it to be in violation of such legal
requirements in a manner which would result in a material adverse effect on the
Servicer or its financial condition, said determination to be evidenced by a
resolution of its board of directors to such effect accompanied by a written
opinion of counsel (who may be counsel to the Servicer), satisfactory to WFSRC2,
to such effect. No such resignation shall become effective unless and until a
new servicer acceptable to WFSRC2 is willing to service the Contracts and enters
into a servicing agreement with WFSRC2 in form and substance substantially
similar to this Agreement and satisfactory to WFSRC2. No such resignation shall
affect the obligation of the Servicer to repurchase Contracts pursuant to
Section 3.06.

      (b) Except as specifically permitted in this Agreement, the Servicer may
not assign this Agreement or any of its rights, powers, duties or obligations
hereunder; provided that the Servicer may assign this Agreement in connection
with a consolidation, merger, conveyance, transfer or lease made in compliance
with Section 5.02.

      (c) Except as provided in Sections 5.04(a) and (b), the duties and
obligations of the Servicer under this Agreement shall continue until this
Agreement shall have been terminated, and shall survive the exercise by WFSRC2
right or remedy under this Agreement or the enforcement by WFSRC2 of any
provision of this Agreement.

      (d) The resignation of the Servicer in accordance with this Section shall
not affect the rights of WFSRC2 hereunder. If the Servicer resigns pursuant to
this Section, its appointment as custodian can be terminated pursuant to Section
2.04. Limitation on Liability of Servicer and Others.

      (a) Neither the Servicer nor any of the directors, officers, employees or
agents of the Servicer shall be under any liability to WFSRC2, except as
provided under this Agreement, for any action taken or for refraining from the
taking of any action pursuant to this Agreement or for errors in judgment;
provided, however, that this provision shall not protect the Servicer or any
such person against any liability that would otherwise be imposed by reason of
willful misfeasance, bad faith or negligence (except errors in judgment) in the
performance of duties or by reason of reckless disregard of obligations and
duties under this Agreement. The Servicer and any director, officer, employee or
agent of the Servicer may rely in good faith on any document

                                       14
<PAGE>

of any kind prima facie properly executed and submitted by any person respecting
any matters arising under this Agreement.

      (b) The Servicer and any director, officer, employee or agent of the
Servicer shall be reimbursed by WFSRC2 for any contractual damages, liability or
expense incurred by reason of willful misfeasance, bad faith or negligence
(except errors in judgment) in the performance of duties under this Agreement or
by reason of reckless disregard of its obligations and duties under this
Agreement.

      Except as provided in this Agreement, the Servicer shall not be under any
obligation to appear in, prosecute or defend any legal action that shall not be
incidental to its duties to service the Contracts in accordance with this
Agreement, and that in its opinion may involve it in any expense or liability;
provided, however, that the Servicer may undertake any reasonable action that it
may deem necessary or desirable in respect of this Agreement and the rights and
duties of the parties to this Agreement.

                                  ARTICLE SIX

                                     DEFAULT

      Section 6.01. Servicer Default. If any one of the following events (a
"Servicer Default") shall occur and be continuing:

            (a) any failure by the Servicer, to deposit or credit, or to deliver
for deposit, in the Collection Account any amount required hereunder to be as
deposited, credited or delivered or to make any required distributions
therefrom, that shall continue unremedied for a period of three Business Days
after written notice of such failure is received from WFSRC2 or after discovery
of such failure by an officer of the Servicer;

            (b) any failure by the Servicer to deliver to WFSRC2 a report in
accordance with Section 4.08, or the Servicer shall have defaulted in the due
observance of any provision of Section 5.02 (other than failure to enter into an
assumption agreement under Section 5.02, which is a Servicer Default only if
such failure continues for ten Business Days);

            (c) failure on the part of the Servicer duly to observe or to
perform in any material respect any other covenants or agreements of the
Servicer set forth in this Agreement, which failure shall (i) materially and
adversely affect the rights of WFSRC2 and (ii) continue unremedied for a period
of 30 days after the date on which written notice of such failure, requiring the
same to be remedied, shall have been given to the Servicer by WFSRC2;

            (d) the occurrence of an Insolvency Event with respect to WFSRC2 or
the Servicer; or

            (e) any representation, warranty or statement of the Servicer or
WFSRC2 made in this Agreement or any certificate, report or other writing
delivered pursuant hereto shall prove to be incorrect in any material respect as
of the time when the same shall have been made , and the incorrectness of such
representation, warranty or statement has a material adverse effect on WFSRC23
and, within 30 days after written notice thereof shall have been given to the

                                       15
<PAGE>

Servicer by WFSRC2, the circumstance or condition in respect of which such
representation, warranty or statement was incorrect shall not have been
eliminated or otherwise cured;

then, and in each and every case, so long as such Servicer Default shall not
have been remedied, WFSRC2, by notice then given in writing to the Servicer may
terminate all the rights and obligations of the Servicer under this Agreement.
Upon such termination, termination of the Servicer as custodian can be made
pursuant to Section 2.05. On or after the receipt by the Servicer of such
written notice, all authority and power of the Servicer under this Agreement,
shall, without further action, pass to and be vested in WFSRC2 or such successor
Servicer as may be appointed under Section 6.02. The Servicer shall cooperate
with WFSRC2 in effecting the termination of the responsibilities and rights of
the predecessor Servicer under this Agreement, including the transfer to WFSRC2
for administration by it of all cash amounts that shall at the time be held by
the predecessor Servicer for deposit, or shall thereafter be received by it with
respect to any Contract.

      Section 6.02. Purchaser to Act; WFSRC2 of Successor. Upon the Servicer's
receipt of notice of termination pursuant to Section 6.01 or resignation
pursuant to Section 5.04, WFSRC2 shall be the successor to the Servicer in its
capacity as servicer under this Agreement, and shall be subject to all the
responsibilities, duties and liabilities relating thereto placed on the Servicer
by the terms and provisions of this Agreement. WFSRC2 may, if it shall be
unwilling to act, or shall, if it shall be legally unable so to act, appoint, or
petition a court of competent jurisdiction to appoint, any established financial
institution, having a net worth of not less than $50,000,000 and whose regular
business shall include the servicing of motor vehicle retail installment sales
contracts, as the successor to the Servicer under this Agreement. WFSRC2 and
such successor shall take such action, consistent with this Agreement, as shall
be necessary to effectuate any such succession.

                                  ARTICLE SEVEN

                                   TERMINATION

      Unless terminated as a result of a Servicer Default, this Agreement shall
continue until all Contracts have been paid in full or until the Servicer and
WFSRC2 mutually agree to terminate this Agreement. If, at such time of
termination, any Contracts remain Outstanding, all Contract Documents and Net
Collections shall be delivered to WFSRC2.

                                  ARTICLE EIGHT

                                  MISCELLANEOUS

      Section 8.01 Amendment. This Agreement may be amended by the Servicer and
WFSRC2 only by a subsequent written agreement executed by any such Persons.

      Section 8.02 Protection of Title to Contracts and Proceeds.

                                       16
<PAGE>

      (a) The Servicer shall execute and file such financing statements and
cause to be executed and filed such continuation statements, all in such manner
and in such places as may be required by law fully to preserve, maintain and
protect the perfection and priority of the interest of WFSRC2 in the Contracts
and in the proceeds thereof. The Servicer shall deliver (or cause to be
delivered) to WFSRC2 file-stamped copies of, or filing receipts for, any
document filed as provided above, as soon as available following such filing.

      (b) The Servicer shall not change its name, identity or corporate
structure in any manner that would, could or might make any financing statement
or continuation statement filed in accordance with Section 8.02(a) seriously
misleading within the meaning of Section 9-507 of the UCC, unless it shall have
given WFSRC2 at least 60 days' prior written notice thereof and shall have
promptly filed appropriate amendments to all previously filed financing
statements or continuation statements.

      (c) The Servicer shall give WFSRC2 at least 60 days' prior written notice
of any relocation of the principal executive office of the Servicer or the
Servicer if, as a result of such relocation, the applicable provisions of the
UCC would require the filing of any amendment of any previously filed financing
or continuation statement or of any new financing statement and shall promptly
file any such amendment or new financing statement. The Servicer shall at all
times maintain each office from which it shall service Contracts, and its
principal executive office, within the United States.

      (d) The Servicer shall maintain or cause to be maintained accounts and
records as to each Contract accurately and in sufficient detail to permit (i)
the reader thereof to know at any time the status of such Contract, including
payments and recoveries made and payments owing (and the nature of each) and
(ii) reconciliation between payments or recoveries on (or with respect to) each
Contract and the amounts from time to time deposited in or credited to the
Collection Account in respect of such Contract.

      (e) The Servicer shall maintain or cause to be maintained its computer
systems so that, from and after the time of sale under this Agreement of the
Contracts, the Servicer's master computer records (including any backup
archives) that shall refer to a Contract indicate clearly the interest of WFSRC2
in such Contract and that such Contract is owned by WFSRC2. Indication of
WFSRC2's ownership interest in a Contract shall be deleted from or modified on
the Servicer's computer systems when, and only when, the related Contract shall
have been paid in full or repurchased.

      (f) If at any time the Servicer shall propose to sell, grant a security
interest in, or otherwise transfer any interest in automotive retail installment
sales contracts to any prospective purchaser, lender or other transferee, the
Servicer shall give or cause to be given to such prospective purchaser, lender
or other transferee computer tapes, records or print-outs (including any
restored from back-up archives) that, if they shall refer in any manner
whatsoever to any Contract, shall indicate clearly that such Contract has been
sold and is owned by WFSRC2.

      (g) The Servicer shall permit WFSRC2 and its agents, at any time during
normal business hours, to inspect, audit and make copies of and abstracts from
the Servicer's records regarding any Contract.

                                       17
<PAGE>

      Section 8.03 Governing Law. This Agreement shall be construed in
accordance with the laws of the State of California and the obligations, rights,
and remedies of the parties under the Agreement shall be determined in
accordance with such laws.

      Section 8.04 Notices. All demands, notices and communications upon or to
the Servicer or WFSRC2 under this Agreement shall be in writing, personally
delivered or mailed by certified mail, return receipt requested, and shall be
deemed to have been duly given upon receipt in the case of (i) the Servicer, 23
Pasteur, Irvine, California 92618, Attention: Legal Department, (ii) WFSRC2, 23
Pasteur, Irvine, California 92618, Attention: Legal Department; or, as to each
of the foregoing, at such other address as shall be designated by written notice
to the other parties.

      Section 8.05 Severability of Provisions. If one or more of the covenants,
agreements, provisions or terms of this Agreement shall be for any reason
whatsoever held invalid, then such covenants, agreements, provisions or terms
shall be deemed severable from the remaining covenants, agreements, provisions
or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement.

      Section 8.06 Assignment. Notwithstanding anything to the contrary
contained herein, as provided in Sections 5.02 and 5.04, this Agreement may not
be assigned by the Servicer without the prior written consent of WFSRC2.

      Section 8.07 Third Party Beneficiaries. Except as otherwise specifically
provided herein, the parties hereto hereby manifest their intent that no third
party other than WFSRC2 shall be deemed a third party beneficiary of this
Agreement, and specifically that the Obligors are not third party beneficiaries
of this Agreement.

      Section 8.08 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall together
constitute but one and the same instrument.

      Section 8.09 Headings. The headings of the various Articles and Sections
herein are for convenience of reference only and shall not define or limit any
of the terms or provisions hereof.

                            [Signature Page Follows]

                                       18
<PAGE>

      IN WITNESS WHEREOF, the parties hereto have caused this Servicing
Agreement to be duly executed by their respective officers as of the date first
above written.

                              WFS RECEIVABLES CORPORATION 2

                              By: ______________________________________________
                                  Name: John Coluccio
                                  Title: President

                              WFS FINANCIAL INC

                              By: ______________________________________________
                                  Name: J. Keith Palmer
                                  Title: Senior Vice President and Treasurer

<PAGE>

                                                                      SCHEDULE A

                              SCHEDULE OF CONTRACTS

      Schedule of Contracts on file at the offices of the
      Servicer and WFSRC2.

      Closing Date as it relates to the Schedule of Contracts
      set forth in this Schedule A shall mean August 20, 2004.

                                      A-1
<PAGE>

                                                                       EXHIBIT I

                           LOCATION OF CONTRACT FILES

WFS Financial Inc                     WFS Financial Inc
23 Pasteur                            6061 N. State Highway 161
Irvine, CA 92618                      Irving, TX 75038
714-727-1000                          800-811-4334 or 214-409-3300

                                      B-1<PAGE>

                                                                    EXHIBIT 10.4

                          MASTER TAX SHARING AGREEMENT

This Master Tax Sharing Agreement ("Agreement"), which amends and restates in
its entirety the prior Tax Sharing Agreement and incorporates all previous
amendments, is effective as of the first day of the consolidated return year
beginning January 1, 2004, by and among Westcorp (FEIN No. 51-0308535)
("Parent") and each of the undersigned ("Subsidiaries").

                       Westran Services Corp. (33-0681134)
                      Western Auto Investments (33-0696532)
                       Western Financial Bank (94-2504080)
                         WFS Financial Inc (33-0291646)
                   WFS Financial Auto Loans, Inc. (33-0149603)
                  WFS Financial Auto Loans 2, Inc. (33-0218079)
                       WFS Investments, Inc. (33-0712766)
                         WFS Funding, Inc. (33-0874765)
                    WFS Receivables Corporation (33-0885464)
                   WFS Receivables Corporation 2 (88-0466468)
                   WFS Receivables Corporation 3 (94-3401639)
                   WestFin Insurance Agency, Inc. (95-3439391)
                  Western Consumer Services, Inc. (94-2643049)
                 Western Reconveyance Company, Inc. (95-3360526)
                  Westhrift Life Insurance Company (86-0397136)
                        WFS Web Investments (26-0003040)
                     Western Consumer Products (33-0987340)
             The Hammond Company, The Mortgage Bankers (95-2954207)
               WFS Receivables Corporation 4 (FEIN No. 05-0576204)
           Western Financial Associate Solutions (FEIN No. 20-0362710)

WHEREAS, the parties (hereinafter sometimes referred to as "Members") hereto are
part of an affiliated group ("Affiliated Group") as defined in Section 1504(a)
of the Internal Revenue Code of 1986, as amended ("IRC"); and

WHEREAS, such Affiliated Group has since December 31, 1986, filed a consolidated
federal income tax return in accordance with IRC Section 1501 and is required to
file consolidated income tax returns for years subsequent to such year of first
consolidated filing; and

WHEREAS, it is the intent and desire of the parties hereto that a method be
established, pursuant to the Interagency Policy Statement on Income Tax
Allocation in a Holding Company Structure (developed by the Office of Thrift
Supervision, the Federal Deposit Insurance Corporation, the Federal Reserve
Board, and the Office of the Comptroller of the Currency) for allocating the
consolidated "federal income tax liability" (as determined under Regulations
Section 1.1502-2) of the Affiliated Group among its Members (as required by IRC
Section 1552 (a)); for reimbursing the Parent for payment of such tax liability;
for compensating any Member for use of its "net operating loss" or "tax credit"
in arriving at such tax liability; and to provide for the allocation and payment
of any refund arising from a carryback of net operating losses or tax credits of
subsequent taxable years.

NOW, THEREFORE, in consideration of the mutual covenants and promises contained
herein, the parties hereto agree as follows:

1. A U.S. consolidated federal income tax return shall be filed by the Parent
for the taxable year ended December 31, 2003, and for each subsequent taxable
year in respect of which this Agreement is in effect and for which the
Affiliated Group is required or permitted to file a consolidated federal income
tax return. The Parent and each Subsidiary shall execute and follow such
consents, elections, and other documents that may be required or appropriate for
the proper filing of such returns.

2. The Parent and Subsidiaries have hereby elected to allocate their federal tax
liability during consolidated tax return years pursuant to Regulation Section
1.1552-1 (a)(1) using method one in

                                        1
<PAGE>

conjunction with the election pursuant to Regulation Section 1.1502-33(d)(3),
provided that the basis for allocation of total tax is based on the ratio that
each Member's separate return taxable income for the tax year bears to the sum
of the separate taxable income of each Member. Each Member agrees that the
policy of the Affiliated Group is to compute its taxable income on a separate
return basis. The fixed percentage to be used under Regulation Section 1.1502-33
(d)(3) shall be 100%.

3. The taxable income of the Parent Affiliated Group, which is all the Members,
shall be used to determine the allocation of the tax liability, unless the use
of that number results in an allocation which is unfavorable to the Bank
Affiliated Group, which is all the Members except the Parent, Westran Services
Corporation, WFS Receivables Corporation 2, Western Consumer Products and WFS
Receivables Corporation 4, in which case, the separate tax liability of the
Bank's Affiliated Group shall be allocated among the members of the Bank
Affiliated Group.

4. Each Member shall pay the Parent its allocated consolidated federal income
tax liability under this Agreement. Such payment is expressly limited to the
portion currently due and payable to the Internal Revenue Service ("IRS"). The
timing of such payment shall be consistent with the due date of the payment from
each Member if it had been filed on a separate return basis provided that in no
event shall payment be made until expiration of any extension that may be in
effect as to the Parent. Current payment by any Member to the Parent of that
Member's deferred tax liability is expressly forbidden. Each Member benefiting
from net operating losses and tax credits shall pay to the Parent its added tax
assessment determined under paragraph 2 of the Agreement. The Parent shall pay
to each Member with a net operating loss or tax credit during the taxable year
its allocable share of the total of the additional amounts due from other
Members pursuant to paragraph 2 of this Agreement. Payments for these allocable
shares are to be made no later than 30 days after the date of filing of the
consolidated federal income tax return for such taxable year. Due to
administrative costs of completing cash transfers, deminimus payments by and
among the Members, in the amount of twenty dollars ($20.00) or less, need not be
allocated amongst the Members.

5. Each Member shall determine its share of estimated tax payments to be made on
the projected consolidated federal income tax liability for each year on a
separate return basis. Payment to the Parent shall be made at the time the
estimated payment is due. Such Member will receive credit for such prepayments
in the year end computation under paragraph 4 of this Agreement.

6. If part or all of an unused consolidated net operating loss or tax credit is
allocated to a Member of the Affiliated Group pursuant to Regulations Section
1.1502-79, and it is carried back or forward to a year in which such Member
filed a separate income tax return or a consolidated federal income tax return
with another affiliated group, any refund or reduction in tax liability arising
from the carryback or carryover shall be retained by such Member. (If such
refund or reduction goes to some entity other than the Member, then such entity
shall pay over such amount to the Member.) Notwithstanding the above, the Parent
shall determine whether an election shall be made not to carry back any
consolidated net operating loss arising in a consolidated return year (including
any portion allocated to a Member under Regulations Section 1.1502-79) in
accordance with IRC Section 172(b)(3). Notwithstanding, in keeping with the
separate return basis, Members shall receive payment for any refund of
previously paid taxes it could have received if such losses could have carried
back for a tax refund on a separate Member basis.

7. If the consolidated federal income tax liability is adjusted for any taxable
period, whether by means of amended return, claim for refund, or after-tax audit
by the IRS, the liability of each Member shall be recomputed under paragraph 2
of this Agreement to give effect to such adjustments. In the case of a deminimus
refund of $10,000 or less, which the Parent shall hold in Trust for each Member,
the Parent shall make payment to each Member for its share of the refund within
thirty (30) days after the refund is received by the Parent, and in the case of
a deminimus increase of up to $10,000 in tax liability, each Member shall pay to
the Parent to be held in Trust for the Parent its allocable share of such
increased tax liability no later than thirty (30) days after the Parent must
make such payment. In the case of a refund greater than $10,000, which the
Parent shall hold in Trust for each Member, the Parent shall make payment to
each Member for its share of the refund within ten (10) business days after the
refund is received by the Parent, and in the case of an increase greater than
$10,000 in tax liability, each Member shall pay to the Parent to be held in
Trust for the Parent its allocable share of such increased tax liability

                                        2
<PAGE>

no later than ten (10) days after the Parent must make such payment. If any
interest is to be paid or received as a result of a consolidated federal income
tax deficiency or refund, such interest shall be allocated to the Members in the
ratio of each Members' change in consolidated federal income tax liability bears
to the total change in tax liability. Any penalty shall be allocated upon such
basis as the Members deems just and proper in view of all applicable
circumstances and which is consistent with the separate return provisions of
this Agreement.

8. The administration of this Agreement as regards the determination of amounts
payable to or from the Subsidiaries hereunder shall be reasonably determined by
independent certified public accountants and, subject to the specific provisions
of this Agreement, in accordance with generally accepted accounting principles.

9. Notwithstanding any other provision of this Agreement, under no circumstances
shall the amounts payable by a Subsidiary to Parent hereunder in any taxable
year exceed the tax liability currently payable to tax authorities by any Member
on a separate return basis. If under the mechanics of this Agreement,
unreasonable results are obtained, the results can be adjusted using any
reasonable methodology.

10. This Agreement shall apply to the taxable years specified in the preamble of
this Agreement, and all subsequent taxable years, unless the Members agree in
writing to terminate the Agreement. Notwithstanding such termination, this
Agreement shall continue in effect with respect to any payment or refunds due
for all taxable periods prior to termination.

11. This Agreement shall not be assignable by any Member without the prior
written consent of the others.

12. All materials including, but not limited to, returns, supporting schedules,
work papers, correspondence and other documents relating to the consolidated
federal income tax returns filed for a taxable year during which this Agreement
was in effect shall be made available to any Member to the Agreement during
regular business hours for a minimum period equal to applicable Federal record
retention requirements.

13. Any dispute or controversy among the parties arising out of or relating to
any of the terms, conditions or covenants, of this Agreement shall be submitted
to arbitration upon written request of any party, such request to be served upon
all other parties to the Agreement according to the following procedure:

      a)    All parties to the Agreement shall select one arbitrator to hear and
            determine the dispute. If, within 30 days of the above-mentioned
            notice, the parties shall fail to appoint such arbitrator, then such
            appointment shall be made by the American Arbitration Association.

      b)    The award rendered by the arbitrator shall be final, conclusive and
            binding upon all parties to the Agreement and judgment thereon may
            be entered in any court having jurisdiction thereof.

14. Any Member corporation which leaves the consolidated group shall be bound by
this Agreement.

15. The Members hereto specifically recognize that from time to time other
companies may become Members of the Affiliated Group and hereby agree that such
new Members may become parties to this Agreement by executing the master copy of
this Agreement which shall be maintained at the Parent's corporate offices
located at 23 Pasteur, Irvine, California 92618. It will not be necessary for
all the other Members to resign the Agreement but the new Members may simply
sign the existing agreement and it will be effective as if the old Members had
resigned.

16. The Members hereto specifically recognize that from time to time certain
amendments to this Agreement may affect only certain members, for example, in
the case of a name change and hereby

                                        3
<PAGE>

agree that such amendments need only be executed by a designee of the Parent and
a designee of the Member or Members directly affected by the amendment.

17. Any alteration, modification, addition, deletion, or other change in the
consolidated income tax return provisions of the Code or the regulations
thereunder shall automatically be applicable to this Agreement.

18. Failure of one or more parties hereto to qualify by meeting the definition
of Members of the "Affiliated Group" shall not operate to terminate this
Agreement with respect to the other parties as long as two or more parties
hereto continue to qualify.

19. This Agreement shall bind and inure to the respective successors and assigns
of the parties hereto; and no assignment shall relieve any party's obligations
hereunder without the written consent of the other parties.

20. This Agreement shall be governed by the laws of the State of California.

21. This Agreement specifically addresses the federal tax liability but does not
make reference to the state tax liability. Similar methodology will be used for
purposes of allocating the state tax liability in states where the group files
on either a combined or consolidated basis. California does not permit the
filing of a consolidated return. However, the Parent and Subsidiaries are
members of a unitary group filing a combined California return, and the results
will be approximately the same as if a consolidated return were filed (with the
exception that the financial institutions pay at a rate higher than that of the
nonfinancial institutions).

IN WITNESS WHEREOF, the parties hereto acknowledge that this Master Tax Sharing
Agreement supersedes all earlier dated agreements and amendments and have caused
their names to be subscribed and executed by their respective authorized
officers on the dates indicated, effective as of the date first written above.

WESTCORP

By: _______________________________________          Date: December ___, 2003
      Thomas A. Wolfe, President

WESTRAN SERVICES CORPORATION

By: _______________________________________          Date: December ___, 2003
      Shelley M. Chase, President

WESTERN FINANCIAL BANK

By ________________________________________          Date: December ___, 2003
      Thomas A. Wolfe, President

WFS FINANCIAL INC

By:________________________________________          Date: December ___, 2003
      Thomas A. Wolfe, President

                                        4
<PAGE>

WFS FINANCIAL AUTO LOANS, INC.

By: _______________________________________          Date: December ___, 2003
      John Coluccio, President

WFS FINANCIAL AUTO LOANS 2, INC.

By: _______________________________________          Date: December ___, 2003
                                                     President

WFS INVESTMENTS, INC.

By: _______________________________________          Date: December ___, 2003
      Lee A. Whatcott, Vice President

WFS FUNDING, INC.

By: _______________________________________          Date: December ___, 2003
      John Coluccio, President

WFS RECEIVABLES CORPORATION

By: _______________________________________          Date: December ___, 2003
      John Coluccio, President

WFS RECEIVABLES CORPORATION 2

By: _______________________________________          Date: December ___, 2003
      John Coluccio, President

WFS RECEIVABLES CORPORATION 3

By: _______________________________________          Date: December ___, 2003
      John Coluccio, President

WESTERN AUTO INVESTMENTS, INC.

By: _______________________________________          Date: December ___, 2003
      John Coluccio, President

WESTERN CONSUMER SERVICES, INC.

By: _______________________________________          Date: December ___, 2003
      James E. Tecca, President

                                        5
<PAGE>

WESTERN CONSUMER PRODUCTS

By: _______________________________________          Date: December ___, 2003
      Mark Marty, President

WESTERN RECONVEYANCE COMPANY, INC.

By: _______________________________________          Date: December ___, 2003
      J. Keith Palmer, President

WESTFIN INSURANCE AGENCY, INC.

By: _______________________________________          Date: December ___, 2003
      Thomas A. Wolfe, President

WFS WEB INVESTMENTS

By: _______________________________________          Date: December ___, 2003
      Thomas A. Wolfe, President

THE HAMMOND COMPANY, THE MORTGAGE BANKERS

By: _______________________________________          Date: December ___, 2003
      Thomas A. Wolfe, President

WESTHRIFT LIFE INSURANCE COMPANY

By: _______________________________________          Date: December ___, 2003
      Lee A. Whatcott, President

WFS RECEIVABLES CORPORATION 4

By: _______________________________________          Date: December ___, 2003
      John Coluccio, President

WESTERN FINANCIAL ASSOCIATE SOLUTIONS

By: _______________________________________          Date: December ___, 2003
      Karen Marchak, President

                                        6

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