Document:

Exhibit 10.4

                     WAREHOUSE CREDIT AND SECURITY AGREEMENT

                                     BETWEEN

                        COMMUNITY RESOURCE MORTGAGE, INC.

                                       AND

                        BRANCH BANKING AND TRUST COMPANY

                           Dated as of October 5, 2004

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                                    EXHIBITS

       Exhibit A     Form of Guaranty Agreement

       Exhibit B     Form of Advance Request and Officer's Certification

       Exhibit C     Procedure for Requesting Advances and Collateral Documents

       Exhibit D     General Operational Guidelines

       Exhibit E     Form of Assignment of Notes and Mortgages

       Exhibit F     Additional Underwriting Guidelines

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          WAREHOUSE CREDIT AND SECURITY AGREEMENT ("Loan Agreement") dated as of
October  5, 2004  between  COMMUNITY  RESOURCE  MORTGAGE,  INC.,  a  corporation
organized  under the laws of South  Carolina,  having an address at 508  Hampton
Street,  Columbia,  South Carolina 29201 (the  "Company") and BRANCH BANKING AND
TRUST COMPANY, a North Carolina banking  corporation,  having an address at Post
Office Box 628, Monroe, North Carolina 28111-0628 (the "Bank").

         WHEREAS,  the Company has requested the Bank,  and the Bank has agreed,
to extend a  warehousing  line of credit to the Company to finance the making of
Mortgage Loans (as hereinafter defined) as hereinafter set forth.

         NOW, THEREFORE,  for good and valuable  consideration,  the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:

I. DEFINITIONS.

1.1      Defined Terms.

         Capitalized  terms  defined  below or elsewhere in this Loan  Agreement
(including the Exhibits hereto) shall have the following meanings:

         "Adjusted  LIBOR Rate" is a variable rate of interest and means the sum
obtained  (rounded  up, if  necessary,  to the next  higher  1/100th of 1.0%) by
adding  LIBOR-One  Month (as defined  below) plus 2.00% per year,  which rate of
interest  shall be determined  and adjusted as of the first day of each calendar
month  during  the term  hereof;  provided,  however,  if the  first  day of any
calendar  month shall fall on a day when the Bank is closed,  the Adjusted LIBOR
Rate  shall be  determined  as of the last  preceding  day on which the Bank was
opened for  business  (each of said dates,  as  appropriate,  being  referred to
herein as the  "Determination  Date").  "LIBOR-One Month" means the average rate
(rounded  up, if  necessary,  to the next higher  1/100th of 1.0%) quoted on the
Determination  Date for LIBOR-one month on page 3750 (or such replacement  page)
of the Telerate Service or on Bloomberg Screen MMR2, or if the above methods for
determining  LIBOR-One  Month shall not be  available,  a rate  determined  by a
substitute method mutually agreed on by the Company and Bank; provided, however,
if such  agreement  is not  reached  within a  reasonable  period  of  time,  as
determined  solely  by  Bank,  LIBOR-One  Month  shall  be the  rate  reasonably
determined by Bank, in its sole  discretion,  as the average rate being paid, as
of the  Determination  Date, by leading banks (as determined  solely by Bank) in
the London interbank market for U.S. Dollar deposits.

         "Advance"  means a  disbursement  by the  Bank  under  the  Commitment,
including  readvances of funds previously  advanced to the Company and repaid to
the Bank.

         "Advance Request" has the meaning set forth in Section 2.2(a) hereof.

         "Bank" has the  meaning set forth in the first  paragraph  of this Loan
Agreement

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         "Business  Day" means any day  excluding  Saturday,  Sunday and any day
which is a legal holiday under the laws of the States of South Carolina or North
Carolina.

         "Collateral" has the meaning set forth in Section 3.1 hereof.

         "Collateral  Documents"  has the  meaning  set forth in Section  2.2(b)
hereof.

         "Collateral Value" has the meaning set forth in Section 2.1(c) hereof.

         "Commitment" has the meaning set forth in Section 2.1(a) hereof.

         "Company" has the meaning set forth in the first paragraph of this Loan
Agreement.

          "Default"  means  the  occurrence  of any  event or  existence  of any
condition which, but for the giving of notice, the lapse of time, or both, would
constitute an Event of Default.

         "Event of Default"  means any of the  conditions or events set forth in
Section 8.1 hereof.

         "FHLMC"  means the  Federal  Home  Loan  Mortgage  Corporation  and any
successor thereto.

         "FNMA"  means The  Federal  National  Mortgage  Bank and any  successor
thereto.

          "Funding Date" has the meaning set forth in Section 2.2(c) hereof.

         "GAAP" means  generally  accepted  account  principles set forth in the
opinions and  pronouncements  of the Account  Principles  Board and the American
Institute of Certified Public  Accountants and statements and  pronouncements of
the Financial  Account  Standards Board and such other  statements by such other
entity as may be approved by a significant segment of the accounting profession,
which are applicable to the circumstances as of the date of determination.

         "Guarantor"  means  Community   Bankshares,   Inc.,  a  South  Carolina
corporation.

         "Guaranty" has the meaning set forth in Section 2.8 hereof.

         "Indemnified  Liabilities"  has the  meaning  set  forth in  Article  X
hereof.

         "Initial Request" has the meaning set forth in Section 2.2(d) hereof.

         "Investor"  means  FNMA  or  FHLMC,  the  Bank,  or  other  financially
responsible  public or private lending  institution  which is deemed  reasonably
acceptable by the Bank in its sole discretion.

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         "Lien"  means  any lien,  mortgage,  deed of  trust,  pledge,  security
interest,  charge or encumbrance of any kind (including any conditional  sale or
other  title  retention  agreement,  any lease in the  nature  thereof,  and any
agreement to give any security interest).

         "Loan Agreement" means this Warehouse Credit and Security Agreement, as
it may from time to time be supplemented, modified or amended.

         "Mortgage" means a first priority  mortgage on real property located in
the  State of South  Carolina  to be  improved  to  contain  one to four  family
residences securing a Mortgage Note.

         "Mortgage Loan" means any combined home construction and permanent loan
evidenced by a Mortgage Note, acceptable to Bank in Bank's sole discretion.

         "Mortgage  Loan  Maturity  Date" has the  meaning  set forth in Section
2.5(b) hereof.

         "Mortgage Note" means a note secured by a Mortgage.

         "Mortgage Note Amount" means the outstanding unpaid principal amount of
a Mortgage Note at the time such Mortgage Note is pledged to the Bank.

         "Non-Qualifying  Mortgage  Loan" means any Mortgage  Loan that does not
comply with the Underwriting Guidelines set forth herein.

         "Note" has the meaning set forth in Section 2.3 hereof.

         "Notices" has the meaning set forth in Article IX hereof.

          "Person" means and includes  natural  persons,  corporations,  limited
liability companies,  limited partnerships,  general  partnerships,  joint stack
companies,  joint  ventures,  associations,   companies,  trusts,  banks,  trust
companies,  land trusts,  business trust or other organizations,  whether or not
legal entities, and governments and agencies and political subdivisions thereof.

         "Pledged Mortgages" has the meaning set forth in Section 3.1(a) hereof.

         "Purchase Commitment" means a written commitment, in form and substance
reasonably  satisfactory  to the  Bank,  issued  in favor of the  Company  by an
Investor, or by a mortgage insurance company on behalf of an Investor,  pursuant
to which that  Investor  commits to purchase  Mortgage  Loans  originated by the
Company.

         "Qualifying  Mortgage  Loan" means any Mortgage Loan that complies with
the Underwriting Guidelines set forth herein.

         "Redemption Amount" has the meaning set forth in Section 3.3 hereof.

          "Statement Date" has the meaning set forth in Section 4.1(f) hereof.

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          "Subsidiary"  means any  corporation,  association  or other  business
entity  in which  more  than 25% of the  total  voting  power or shares of stock
entitled to vote in the election of directors,  managers or trustees  thereof is
at the time owned or controlled,  directly or indirectly,  by the Company or one
or more of the other Subsidiaries of the Company or a combination thereof.

         "UCC" means the Uniform Commercial Code of South Carolina, as in effect
on the date hereof.

         "Underwriting  Guidelines" means those specific  underwriting  criteria
for Mortgage Loans set forth in the FNMA and/or FHLMC Seller's Guide, such other
underwriting  guidelines of Investors as identified on Exhibit F attached hereto
or as mutually agreed to by the Bank and the Company from time to time.

         1.2      Other Definition Provisions.

                  (a) Accounting  terms not otherwise  defined herein shall have
         the meanings given them under GAAP.

                  (b) Defined  terms may be used in the  singular or the plural,
         as the context requires.

II. THE CREDIT.

         2.1      The Commitment.

                  (a) Subject to the terms and conditions of this Loan Agreement
         and  provided no Default has  occurred  which has not been cured to the
         satisfaction of the Bank, the Bank agrees, from time to time during the
         period from the date hereof to and including September 24, 2005 (unless
         such period is earlier  terminated or extended pursuant hereto) to make
         Advances to the Company,  provided the total aggregate principal amount
         outstanding  at any one time of such  Advances  shall not exceed Twenty
         Million and No/100 Dollars ($20,000,000.00). The obligation of the Bank
         to make Advances hereunder up to such limit is hereinafter  referred to
         as the "Commitment."  Within the limits of the Commitment,  the Company
         may borrow, repay and reborrow from the Bank.

                  (b)  Advances  shall  be used by the  Company  solely  for the
         purpose of funding the Company's  origination  of Mortgage  Loans which
         shall have been  presold by the Company to an Investor  approved by the
         Bank pursuant to a Purchase Commitment acceptable to the Bank. Advances
         shall be made at the request of the Company,  in the manner hereinafter
         provided  in  Section  2.2,  against  the  pledge  to the  Bank  of the
         Collateral  Documents  evidencing  and securing such Mortgage  Loans as
         Collateral therefore.

                  (c)  An  Advance  made  against  each  Mortgage  Loan  pledged
         hereunder  shall be in an amount not to exceed the Collateral  Value of
         the Mortgage Loan. For this purpose,  "Collateral  Value" is defined as
         the actual  amount  advanced by the Bank which is less than or equal to

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         the  lesser of (i) one  hundred  percent  (100%) of the  Mortgage  Note
         Amount;  or (ii) one hundred  percent (100%) of the committed  purchase
         price thereof set forth in the Purchase Commitment.

         2.2      Procedures for Obtaining Advances.

                  (a) The  Company may obtain an Advance  hereunder,  subject to
         the  satisfaction  of the  conditions set forth in Sections 4.1 and 4.2
         hereof,  upon  compliance with the procedures set forth in this Section
         2.2.  Requests  for  Advances  shall be  initiated  by the  Company  by
         delivering to the Bank a properly  completed and signed Advance Request
         and Officer's Certification on the then current forms therefor approved
         by the  Bank  (together  with  Bank's  completed  inspection  sheet  if
         construction has commenced)  (collectively,  an "Advance Request"). The
         current  form in use by the Bank as of the date  hereof is set forth in
         Exhibit B hereto. The Bank shall have the right to revise or supplement
         approved  forms of  Advance  Request  by giving  notice  thereof to the
         Company and providing to the Company in electronic  format for use on a
         going-forward basis the revised form Advance Request.

                  (b) The  procedures to be followed by the Company in making an
         Advance Request and the documents relating to the Collateral  described
         in the Advance  Request  (the  "Collateral  Documents")  required to be
         delivered  to the Bank  shall  consist  of those set forth in Exhibit C
         hereto.  The Bank shall have the right, by giving notice thereof to the
         Company, to modify the procedures and Collateral Documents described in
         Exhibit C to conform to current legal requirements or Bank's practices,
         and, as so modified, said Exhibit C shall be deemed part hereof.

                  (c) Before  funding,  the Bank shall have (i) with  respect to
         any Advance Request  received at or before 12:00 p.m.,  until the close
         of  business  of the same  Business  Day and (ii) with  respect  to any
         Advance Request  received after 12:00 p.m., until the close of business
         of the  next  Business  Day (in  each  case,  such  Business  Day to be
         referred to as the "Funding  Date"),  to examine  each Advance  Request
         and, if such Advance  Request is the Initial  Request,  the  Collateral
         Documents  to be  delivered  prior to the  Advance  as set forth in the
         Exhibit  C  hereto  and may  reject  such of  them as do not  meet  the
         requirements of this Loan Agreement. If the Advance Request is accepted
         within the applicable  timeframes  specified above, the Bank shall fund
         the Advance evidenced by the Advance Request no later than the close of
         business on the applicable Funding Date. Bank at its option may, at any
         time,  require the  Company to deliver to Bank all items and  documents
         referred to in Exhibit C (including  without limitation those listed in
         Parts C and and D thereof) as may be in the Company's possession at the
         time the Advance  Request is made together with the Advance Request and
         in such event such  delivery  shall be a condition  precedent to Bank's
         obligation to make requested Advances.

                  (d) To make an  Advance,  the Bank shall wire  transfer to the
         Company's designated deposit account, in the case of an initial request
         for an Advance  under such  Mortgage Loan  ("Initial  Request"),  on or

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         before the date of the  Mortgage  Loan or, for any  requests  after the
         Initial Request for a Mortgage Loan,  within the time periods set forth
         in  Section  2.2(c)(i)  and (ii)  hereinabove,  as  applicable.  At the
         Company's option, the Bank will wire transfer to the closing attorney's
         Trust  Account in advance of closing as  reasonably  determined  by the
         Company, the attorney and the Bank, to facilitate a timely closing, for
         any Initial Requests.

                  (e) All Advances under this Loan Agreement shall  constitute a
         single indebtedness and all of the Collateral shall be security for the
         Note and for all Advances made  thereunder  and for the  performance of
         all obligations of the Company to the Bank.

         2.3      Note.

         The Company's  obligation to pay the principal of, and interest on, all
Advances  made by the Bank is evidenced by the  promissory  note (the "Note") of
the Company dated as of the date hereof in the stated principal amount of Twenty
Million and No/100 Dollars  ($20,000,000.00).  The term "Note" shall include all
extensions,  renewals  and  modifications  of the  Note  and  all  substitutions
therefor. All terms and provisions of the Note are incorporated herein.

         2.4      Interest.

                  (a)  Each  new  Advance  made  after  the  date of  this  Loan
         Agreement shall bear interest, from the date of crediting of the amount
         of the Advance to the Company's designated deposit account (or from the
         date a wire transfer for an Advance is made by the Bank upon Borrower's
         request)  until the date on which each such Advance is paid in full, at
         a floating rate of interest which is equal to the Adjusted LIBOR Rate.

                  (b) For the  purposes  of this Loan  Agreement,  the  Adjusted
         LIBOR Rate at which all outstanding,  unpaid Advances, including, as of
         the date hereof, the outstanding principal balance of all Advances made
         prior to the date hereof,  shall accrue interest will be adjusted as of
         the  first  day of each  calendar  month  hereafter  to give  effect to
         changes, if any, in the Adjusted LIBOR Rate and the Adjusted LIBOR Rate
         in  effect  on  such  first  day  shall  apply  to  all  Advances  then
         outstanding  as well as to  subsequent  Advances made prior to the next
         rate change.

                  (c) Interest  shall be computed on the basis of a 360-day year
         and  applied to the  actual  number of days  elapsed  in each  interest
         calculation  period and shall be payable in arrears,  with the interest
         on each Advance being payable monthly as billed by Bank.

         2.5      Principal Payments.

                  (a) The Company shall have the right to prepay the outstanding
         Advances  in whole or in part,  from time to time,  without  premium or
         penalty.

                  (b) The Company shall be obligated to pay to the Bank, without
         the  necessity of prior  demand or notice from the Bank,  the amount of
         any outstanding Advance, together with all interest due thereon against

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         a specific  Mortgage Loan,  upon the occurrence of any of the following
         events (in each case, a "Mortgage Loan Maturity Date"):

                  (1)  Nine (9)  months  elapse  from  the  date of the  Initial
         Request  funded by the Bank against  such  Mortgage  Loan,  unless Bank
         shall have  consented  to an  extension  to twelve (12) months from the
         date of such Initial Request, in Bank's sole discretion, in which case,
         twelve (12) months elapsing from the date of the funding of the Initial
         Request shall constitute the Mortgage Loan Maturity Date;

                  (2) Ten (10)  Business  Days elapse from the date a Collateral
         Document was  delivered to the Company for  correction  or  completion,
         without being returned to the Bank;

                  (3)  Forty-five  (45) Business Days elapse from the completion
         of the  residence  which  secures the Mortgage Loan as evidenced by the
         issuance of the  Certificate  of Occupancy or  submission  of the final
         inspection sheet, in form and content acceptable to Bank;

                  (4) The expiration or  termination of the Purchase  Commitment
         issued in connection with the Mortgage Loan;

                  (5) Upon the sale of the Mortgage Loan.

         Upon making such  payment to the Bank,  the Company  shall be deemed to
have redeemed the Mortgage Loan related to the Advance which has been paid,  and
the Collateral  Documents relating thereto which have been previously  delivered
to the Investor shall be deemed released by the Bank to the Company.

         2.6      Expiration and/or Termination.

         Unless  extended  in the  sole  discretion  of the  Bank or  terminated
earlier as permitted hereunder, the Commitment shall expire of its own term, and
without the necessity or action by the Bank, at the close of business on October
5, 2005 and the Bank shall not be obligated to make any Advances hereunder after
such date.

         2.7      Method of Making Payments.

                  (a) Except as  otherwise  specifically  provided  herein,  all
         payments  hereunder  shall be made to the Bank not later than 2:00 p.m.
         (Eastern  Standard  Time)  on the date  when  due and  shall be made in
         lawful money of the United States of America in  immediately  available
         funds at the office of the Bank, at Monroe,  North  Carolina or at such
         other place as the Bank from time to time shall designate. Whenever any
         payment  to be made  hereunder  or under the Note shall be stated to be
         due on a day which is not a Business Day, the due date thereof shall be
         extended to the next  succeeding  Business  Day,  and,  with respect to
         payments of  principal,  the interest  thereon  shall be payable at the
         applicable rate during such extension. Funds received by the Bank after

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         2:00 p.m.  on a  Business  Day shall be deemed to have been paid by the
         Company on the next succeeding Business Day.

                  (b) The Company  authorizes the Bank, if and to the extent any
         payment is not made when due and payable hereunder,  or under the Note,
         to charge  and offset  from time to time any  amounts so due and unpaid
         against any or all of the Company's  accounts with the Bank;  provided,
         however,  that the  aforesaid  right to charge the  Company's  accounts
         shall not apply to any deposits of escrow or other moneys designated as
         being held by the Company on behalf of third parties.

         2.8      Default Interest and Fees.

                  (a) In the  event  the  Company  fails  to  make  any  payment
         (whether  of  principal,  interest  or any other  sum) on the date such
         payment  is due and  payable  hereunder  or under  the  Note,  and such
         failure continues.

                  (i) for ten (10) days, the interest rate on such Advance shall
                  be increased  to the Bank's then  current  Prime Rate plus one
                  (1) percent;

                  (ii) for twenty (20) days,  the interest  rate on such Advance
                  shall be increased to the Bank's then current  Prime Rate plus
                  two (2) percent; and

                  (iii) for thirty (30) days, the Company shall pay to the Bank,
                  upon demand  therefore,  a late payment fee equal to five (5%)
                  of the amount of such payment.

                  (b) Company shall pay a fee equal to  $10,000.00,  in advance,
         in consideration  of Bank's  agreement to lend hereunder.  In addition,
         Borrower  shall pay Bank a fee equal to $100.00 for each  Mortgage Loan
         financed hereunder.

         2.9      Guaranty.

         The payment of all  Advances  made  hereunder  together  with  interest
thereon and the Company's  performance  of its  obligations  hereunder  shall be
guaranteed  pursuant to a Guaranty  Agreement  in the form of Exhibit A attached
hereto (the "Guaranty").

III. COLLATERAL.

         3.1      Grant of Security Interest.

         As  security  for the  payment  of the Note and for all  Advances  made
thereunder  and  for  the  performance  of  all  of  the  Company's  obligations
hereunder,  the  Company  hereby  grants to the Bank a security  interest in the
following described property (the "Collateral"):

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                  (a) All  Mortgage  Loans,  including  but not  limited  to all
         Mortgage Notes and Mortgages  evidencing  Mortgage Loans, in respect of
         which an Advance  has been made by the Bank  hereunder  pursuant  to an
         Advance Request (collectively, the "Pledged Mortgages");

                  (b) All private  mortgage  insurance  related to any  Mortgage
         Loans  included in the Pledged  Mortgages;  all  guaranties  related to
         Pledged  Mortgages;  all  Purchase  Commitments  held  by  the  Company
         covering the Pledged Mortgages and all proceeds resulting from the sale
         thereof to Investors  pursuant thereto;  guaranties  related to Pledged
         Mortgages;  and all personal property,  contract rights,  servicing and
         servicing  fees  and  income,   accounts  and  general  intangibles  of
         whatsoever  kind  relating  to  the  Pledged  Mortgages,  the  Purchase
         Commitments,  and all other  documents or instruments  delivered to the
         Bank  in  respect  of  the  Pledged   Mortgages,   including,   without
         limitation,   the  right  to  receive  all   insurance   proceeds   and
         condemnation  awards  which may be payable  in respect of the  premises
         encumbered by any Mortgage,  and all Supporting Obligations (as defined
         in the UCC) of the Pledged Mortgages;

                  (c) All right, title and interest of the Company in and to all
         files,  surveys,  certificates,  correspondence,  appraisals,  computer
         programs,   tapes,   discs,  cards,   accounting  records,   and  other
         information  and  data  of  the  Company  relating  to  the  Collateral
         described in the preceding paragraphs of Section 3.1; and

                  (d) All proceeds of any and all of the foregoing.

         3.2      [Reserved].

         3.3      Right of Redemption from Pledge.

         Provided no Default has  occurred  and is  continuing,  the Company may
redeem a  Mortgage  Loan from  pledge,  by either  (i)  paying to the Bank,  for
application  to prepayment of the principal  balance of the Note, an amount (the
"Redemption  Amount") equal to the then Collateral Value of the Mortgage Loan to
be  released,  but not less than the amount of the Advance  made with respect to
such Mortgage Loan, or (ii) delivering  substitute Collateral which, in addition
to being acceptable to the Bank in its sole  discretion,  will have a Collateral
Value equal to or greater than that of the released Mortgage Loan.

         3.4      Collection and Servicing Right.

         The Bank shall be  entitled  to  service,  receive and collect all sums
payable to the Company in respect of the  Collateral,  and in particular (a) the
Bank in its  discretion  may,  in its own name or in the name of the  Company or
otherwise, demand, sue for, collect or receive any money or property at any time
payable or  receivable  on account of or in exchange for any of the  Collateral,
but shall be under no obligation to do so, (b) the Company shall, if the Bank so
reasonably  requests,  forthwith pay to the Bank at its office designated herein
all amounts thereafter  received by the Company upon or in respect to any of the
Collateral,  advising  the  Bank as to the  source  of such  funds,  and (c) all

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amounts so received and collected by the Bank shall be held by it as part of the
Collateral  and the Bank will account for any such  amounts upon the  reasonable
request of the Company.

         3.5      Return of Collateral at End of Commitment.

         If (i) the Commitment shall have expired or been  terminated,  and (ii)
no Advances,  interest or other amounts  evidenced by the Note or due under this
Loan Agreement shall be outstanding and unpaid,  the Bank shall deliver promptly
or release all Collateral then pledged hereunder to the Company.  The receipt of
the Company for any Collateral  released or delivered to the Company pursuant to
any provision of this Loan  Agreement  shall be a complete and full  acquittance
for the Collateral so returned, and the Bank shall thereafter be discharged from
any liability or responsibility therefor. At the request and sole expense of the
Company following any such termination or release, the Bank shall deliver to the
Company any Collateral held by the Bank hereunder and execute and deliver to the
Company such documents as the Company shall reasonably  request to evidence such
termination and release.

IV. CONDITIONS PRECEDENT.

         4.1      Initial Advance.

         The  obligation  of the  Bank to  make  any  Advance  under  this  Loan
Agreement for a Mortgage Loan is subject to the Bank's receipt of the following,
all of which must be reasonably satisfactory in form and content to the Bank, in
its sole discretion:

                  (a) The Note duly executed by the Company;

                  (b) The Guaranty,  in the form  attached  hereto as Exhibit A,
         duly executed by the Guarantor;

                  (c) Executed  Assignments  of Notes and  Mortgages in the form
         attached hereto as Exhibit E, to be recorded upon the occurrence of any
         Event  of  Default  hereunder  or a  mutually  agreed  upon  electronic
         alternative thereto;

                  (d)   Certified   copies   of  the   Company's   articles   of
         incorporation  and bylaws,  and certificates of existence  delivered to
         the Bank prior to the date of closing;

                  (e) A  resolution  of the board of  directors  of the Company,
         certified as of a date prior to the initial  Advance by its  Secretary,
         authorizing  the  execution,  delivery  and  performance  of this  Loan
         Agreement and the Note,  and all other  instruments  or documents to be
         delivered by the Company pursuant to this Loan Agreement;

                  (f) A certificate of the Company's  corporate  secretary as to
         the  incumbency and  authenticity  of the signatures of the officers of
         the Company executing this Loan Agreement and the Note and each Advance
         Request and all other instruments or documents to be delivered pursuant

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         hereto  (the  Bank  being  entitled  to rely  thereon  until a new such
         certificate has been furnished to the Bank);

                  (g)  Audited  financial  statements  of the  Company  (and its
         Subsidiaries,  on a consolidated  basis) prepared by a Certified Public
         Accountant in form and substance  reasonably  satisfactory to the Bank,
         which shall  include,  but not be limited to, a statement of income for
         the period ending on December 31, 2003 (the "Statement Date");

                  (h) A certificate of insurance evidencing the Company's errors
         and omissions  insurance  policy in an amount of at least  $500,000.00,
         each loss and aggregate;

                  (i) An executed, original opinion of the Company's counsel, in
         form and substance reasonably acceptable to Bank, opining,  among other
         things, as to the  enforceability  of the Loan Agreement,  the Note and
         the  financing   statements,   against  the  Company,  and  as  to  the
         enforceability of the guaranties against the Guarantor; and

         4.2      Each Advance.

         The  obligation  of the  Bank to fund  the  Initial  Request  and  each
subsequent  Advance on a Mortgage  Loan under this Loan  Agreement is subject to
the  satisfaction,  in the sole  discretion  of the Bank, as of the date of each
such Initial Request or subsequent  Advance,  as  appropriate,  of the following
additional conditions precedent:

                  (a) The Company  shall have  delivered to the Bank the Advance
         Request and Collateral  Documents called for hereunder,  and shall have
         satisfied the  procedures  set forth in Sections  2.2(a) through 2.2(c)
         hereof and the applicable  Exhibits hereto described in these Sections.
         All items delivered to the Bank shall be reasonably satisfactory to the
         Bank in form and  content,  and the Bank may reject  such of them as do
         not meet the requirements of this Loan Agreement.

                  (b)  The  Bank  shall  have   received   evidence   reasonably
         satisfactory  to it as to the making  and/or  continuation  of any book
         entry or the due filing and recording in all appropriate offices of all
         financing  statements  and other  instruments  as may be  necessary  to
         perfect the security  interest of the Bank in the Collateral  under the
         South Carolina Uniform Commercial Code or other applicable law.

                  (c)  The   representations   and  warranties  of  the  Company
         contained in Article V hereof shall be true and correct in all material
         respects as if made on and as of the date of each  Advance,  except for
         any  representation  and  warranty  made as of an earlier  date,  which
         representation  and  warranty  shall  remain  true and  correct  in all
         material respects as of such earlier date.

                  (d) The Company and the  Guarantor  shall have  performed  all
         agreements  to be performed by them  hereunder  and under the Guaranty,
         respectively.

                                       11
<PAGE>

                  (e) There shall exist no Default or  condition  or event which
         with the passage of time might  constitute a Default  hereunder and the
         making  of the  requested  Advance  shall  not give  rise to a  Default
         hereunder.

                  (f)  The  Company   shall  not  have   incurred  any  material
         liabilities, direct or contingent, other than in the ordinary course of
         its business,  since the dates of the Company's  most recent  financial
         statements theretofore delivered to the Bank.

                  (g)  The  Company   shall  have  provided  Bank  with  updated
         inspection  reports for all Mortgage  Loans and shall have allowed Bank
         to make any on-sight inspections Bank shall reasonably request.

         Acceptance  of the  proceeds  of the  requested  Advance by the Company
shall be deemed a representation by the Company that all conditions set forth in
this Section 4.2 shall have been satisfied as of the date of such Advance.

V. REPRESENTATIONS.

         The Company hereby  represents and warrants to the Bank, as of the date
of this Loan Agreement and as of the date of each Advance Request, that:

         5.1      Organization; Good Standing.

         The Company is a corporation  duly organized,  validly  existing and in
good standing under the laws of the jurisdiction of its  incorporation,  has the
full legal power and  authority to own its property and to carry on its business
as currently  conducted  and is duly  qualified as a foreign  corporation  to do
business and is in good standing in each  jurisdiction  in which the transaction
of its business makes such qualification necessary.

         5.2      Authorization and Enforceability.

         The Company has the corporate  power and authority to execute,  deliver
and perform this Loan Agreement,  the Note and all other documents  contemplated
hereby or thereby. Each Guarantor has the power and capacity to execute, deliver
and perform the Guaranty. The execution, delivery and performance by the Company
of this Loan Agreement,  the Note and all other documents contemplated hereby or
thereby and the making of the borrowing hereunder and thereunder, have been duly
and validly  authorized  by all  necessary  corporate  action on the part of the
Company (none of which actions have been modified or rescinded, and all of which
actions are in full force and effect) and do not and will not  conflict  with or
violate any provision of law or of the articles of  incorporation  or by-laws of
the Company,  conflict  with or result in a breach of or constitute a default or
require  any  consent  under,  or  result in the  creation  of any Lien upon any
property or assets of the Company,  or result in or require the  acceleration of
any  indebtedness  of the Company  pursuant  to, any  agreement,  instrument  or
indenture  to  which  the  Company  is a party or by which  the  Company  or its

                                       12
<PAGE>

property may be bound or affected.  This Loan Agreement,  the Note and all other
documents  contemplated  hereby or thereby and the  Guaranty  constitute  legal,
valid, and binding obligations of the Company or of the Guarantor, respectively,
enforceable  in accordance  with their  respective  terms,  except as limited by
reorganization,   bankruptcy,  insolvency  or  other  such  laws  affecting  the
enforcement of creditors' rights.

         5.3      Approvals.

         The Company has procured and is in possession of all licenses, permits,
consents or approvals,  and has taken such other actions,  which are required by
Federal, state and local laws, ordinances and regulations for the transaction of
its business,  including,  without limitation, (i) the execution and delivery of
this Loan  Agreement,  the Note and all other documents  contemplated  hereby or
thereby  and  the  performance  of  the  Company's   obligations  hereunder  and
thereunder;  (ii) the making of residential mortgage loans to consumers in South
Carolina upon the security of the consumer's principal residences; and (iii) the
ownership of its properties.

         5.4      Financial Condition.

         The balance  sheet of the  Company as of the  Statement  Date,  and the
related  statement of income,  heretofore  furnished to the Bank, fairly present
the financial  condition of the Company as at the Statement Date and the results
of its operations for the fiscal period ended on the Statement Date. The Company
had,  on the  Statement  Date,  no  liabilities,  direct or  indirect,  fixed or
contingent,  matured or unmatured,  known or unknown,  or liabilities for taxes,
long-term  leases or unusual forward or long-term  commitments not disclosed by,
or reserved  against in, said balance sheet and related  statements,  and at the
present time there are no material  unrealized  or  anticipated  losses from any
loans,  advances  or other  commitments  of the  Company  except  as  heretofore
disclosed to the Bank in writing.  Said  financial  statements  were prepared in
accordance  with GAAP  applied on a  consistent  basis  throughout  the  periods
involved.  Since the Statement Date,  there has been no material adverse changes
in the business,  operations,  assets or financial condition of the Company, nor
is the  Company  aware of any state of facts  which  (with or without  notice or
lapse  of time or  both)  would or could  result  in any such  material  adverse
change.

         5.5      Litigation.

         There are no actions,  claims,  suits or proceedings pending, or to the
knowledge  of the  Company,  threatened  or  reasonably  anticipated  against or
affecting  the Company or any  Subsidiary  of the Company in any court or before
any  arbitrator  or before any  government  commission,  board,  bureau or other
administrative agency which, if adversely determined, may reasonably be expected
to result in any material and adverse change in the business, operations, assets
or financial condition of the Company as a whole.

         5.6      Compliance with Laws.

         The Company is not in violation of any  provision of any law, or of any
judgment,  award, rule,  regulation,  order,  decree,  writ or injunction of any

                                       13
<PAGE>

court or public regulatory body or authority which might have a material adverse
effect on the business, operations, assets or financial condition of the Company
as a whole.

         5.7      Payment of Taxes.

         The  Company  has filed or caused  to be filed all  federal,  state and
local  income,  excise,  property  and other tax  returns  with  respect  to the
operations of the Company  which are required to be filed,  all such returns are
true and  correct,  and the  Company  has paid or caused to be paid all taxes as
shown on such returns or on any  assessment,  to the extent that such taxes have
become due, including,  but not limited to, all Federal Insurance  Contributions
Act payments and withholding taxes, if appropriate.  The amounts reserved,  as a
liability  for income  and other  taxes  payable,  in the  financial  statements
described  in  Section  5.4  hereof  are  sufficient  for  payment of all unpaid
federal,  state and local income,  excise,  property and other taxes, whether or
not disputed,  of the Company accrued for or applicable to the period and on the
dates of such  financial  statements and all years and periods prior thereto and
for which the  Company  may be liable in its own right or as  transferee  of the
assets of, or as successor to, any other person or entity.

         5.8      Agreements.

         The Company is not a party to any agreement, instrument or indenture or
subject to any  restrictions  materially  and adversely  affecting its business,
operations,  assets or financial condition, except as disclosed in the financial
statements  described in Section 5.4 hereof.  The execution and  performance  of
this Loan Agreement will not cause a default, violate or conflict with the terms
of any  material  agreement  to which the  Company  is a party or by which it is
bound.  The  Company  is  not  in  default  in the  performance,  observance  or
fulfillment of any of the obligations,  covenants or conditions contained in any
agreement,  instrument, or indenture which default could have a material adverse
effect on the business,  operations,  properties  or financial  condition of the
Company  as a whole.  No holder of any  indebtedness  of the  Company  has given
notice of any asserted default thereunder,  and no liquidation or dissolution of
the  Company  or of any of its  Subsidiaries  and no  receivership,  insolvency,
bankruptcy,  reorganization or other similar proceedings relative to the Company
or any of its  properties  is  pending,  or to  the  knowledge  of the  Company,
threatened.

         5.9      Special Representations Concerning Collateral.

         The Company hereby  represents and warrants to the Bank, as of the date
of this Loan Agreement and as of the date of each Advance Request, that:

                  (a) The Company is the legal and  equitable  owner and holder,
         free and clear of all Liens,  of the  Pledged  Mortgages.  All  Pledged
         Mortgages  and  Purchase  Commitments  have  been duly  authorized  and
         validly  issued  to the  Company,  and all of the  foregoing  items  of
         Collateral  comply with all of the requirements of this Loan Agreement,
         and have been and will  continue  to be validly  pledged or assigned to
         the Bank, subject to no other Liens.

                                       14
<PAGE>

                  (b) The  Company  has,  and will  continue  to have,  the full
         right,  power and authority to pledge the Collateral  pledged and to be
         pledged by it hereunder.

                  (c) All Mortgage Loans and related  documents  included in the
         Pledged Mortgages (1) as of any date of  determination,  have been duly
         executed and  delivered by the parties named in such Mortgage Loan at a
         closing held not more than five (5)  Business  Days prior to such date,
         (2) have  been made in  compliance  with all  requirements  of the Real
         Estate  Settlement  Procedures Act, Equal Credit  Opportunity  Act, the
         Federal Truth-In-Lending Act and all other applicable federal and state
         laws  and  regulations,  (3) are and  will  continue  to be  valid  and
         enforceable in accordance with their terms,  without defense or offset,
         except as such enforceability may be limited by bankruptcy, insolvency,
         reorganization,  moratorium or similar  state or federal  debtor relief
         laws  from time to time in  effect  which  affect  the  enforcement  of
         creditors'   rights  in  general  and  the  availability  of  equitable
         remedies,  (4) have not been  modified or amended nor any  requirements
         thereof  waived,  and (5) comply and will  continue  to comply with the
         terms of this Loan Agreement and with the related  Purchase  Commitment
         held  by the  Company.  Each  Mortgage  Loan  included  in the  Pledged
         Mortgages will be a first Lien on the premises described therein.

                  (d) No default,  nor any event which,  with notice or lapse of
         time or both,  would become a default,  has occurred and is  continuing
         under any Mortgage Loan included in the Pledged Mortgages.

                  (e) The Company has complied and will  continue to comply with
         all laws,  rules and  regulations  related  to  and/or  governing  each
         Mortgage Loan  included in the Pledged  Mortgages.  All Mortgage  Loans
         comply  with and will  continue  to  comply  in all  respects  with all
         applicable  requirements  for purchase  under the FNMA standard form of
         selling contract and any supplement thereto then in effect.

                  (f) All insurance policies covering the premises encumbered by
         each  Mortgage  included  in the  Pledged  Mortgages  (1) name and will
         continue to name the Company as the insured under a standard  mortgagee
         clause,  (2) are and will continue to be in full force and effect,  and
         (3) afford and will  continue  to afford  insurance  against  builders'
         risk,  fire and such other risks as are usually  insured against in the
         broad form of extended coverage insurance from time to time available.

                  (g) Pledged Mortgages secured by premises located in a special
         flood hazard area  designated  as such by the  Secretary of HUD are and
         shall  continue  to be  covered by special  flood  insurance  under the
         National Flood Insurance Program.

                  (h) Each insured  Mortgage  Loan pledged  hereunder  meets all
         applicable requirements for such insurance. Each Pledged Mortgage meets
         all requirements of the Purchase  Commitment  identified in the Advance
         Request pursuant to which an Advance is made.

                                       15
<PAGE>

VI.      AFFIRMATIVE COVENANTS.

         The Company  agrees that so long as the  Commitment is  outstanding  or
there remain any  obligations of the Company to be paid or performed  under this
Loan Agreement or under the Note, the Company shall:

         6.1      Payment of Note.

         Punctually  pay or cause to be paid the principal  of,  interest on and
all other amounts  payable  hereunder and under the Note in accordance  with the
terms thereof.

         6.2      Financial Statements and Other Reports.

         Deliver to the Bank:

                  (a)  As  soon  as  available  and  in  any  event  within  one
         hundred-twenty  (120) days after the close of each  fiscal  year of the
         Company: statements of income, changes in stockholders' equity and cash
         flows of the  Company  (and,  if  applicable,  its  Subsidiaries,  on a
         consolidated  basis) for such year and the related balance sheet at the
         end of such year (setting forth in comparative  form the  corresponding
         figures for the preceding  fiscal year), all in reasonable  detail,  in
         accordance  with  GAAP,  and  accompanied  by an  audit  opinion  of an
         accounting  firm   reasonably   satisfactory  to  the  Bank,  or  other
         independent   certified  public  accountants  of  recognized   standing
         selected by the Company and  reasonably  acceptable  to the Bank, as to
         said  financial  statements  and a  certificate  signed  by  the  chief
         financial officer of the Company stating that said financial statements
         fairly present the financial condition and results of operations of the
         Company (and, if applicable,  its Subsidiaries) at the end of, and for,
         such year.

                  (b)  As  soon  as  available  and  in  any  event  within  one
         hundred-twenty  (120) days after the close of each  fiscal  year of the
         Guarantor:  statements of income,  changes in stockholders'  equity and
         cash flows of the Guarantor for such year and the related balance sheet
         at the  end of  such  year  (setting  forth  in  comparative  form  the
         corresponding figures for the preceding fiscal year), all in reasonable
         detail, in accordance with GAAP, and accompanied by an audit opinion of
         an  accounting  firm  reasonably  satisfactory  to the  Bank,  or other
         independent   certified  public  accountants  of  recognized   standing
         selected by the Guarantor and reasonably  acceptable to the Bank, as to
         said  financial  statements  and a  certificate  signed  by  the  chief
         financial   officer  of  the  Guarantor  stating  that  said  financial
         statements  fairly  present  the  financial  condition  and  results of
         operations of the Guarantor at the end of, and for, such year.

                  (c) As soon as  available  and no later than  forty-five  (45)
         days  after  the  end of the  quarter  for  which  they  are  prepared:
         internally  generated  quarterly  financial  statements  of the Company
         which shall include but shall not be limited to an income statement.

                                       16
<PAGE>

                  (d)  Reports  in  respect of the  Pledged  Mortgages,  in such
         detail and at such times as the Bank in its  discretion  may reasonably
         request at any time or from time to time.

                  (e)  From  time to  time,  with  reasonable  promptness,  such
         further information regarding the business,  operations,  properties or
         financial condition of the Company as the Bank may reasonably request.

         6.3      Maintenance of Existence; Conduct of Business.

         Preserve and maintain its corporate  existence in good standing and all
of its rights, privileges, licenses and franchises necessary or desirable in the
normal conduct of its business; conduct its business in an orderly and efficient
manner; and make no change in the nature or character of its business.

         6.4      Compliance with Applicable Laws.

         Comply with the requirements of all applicable laws, rules, regulations
and orders of any  governmental  authority,  a breach of which could  materially
adversely  affect its  business,  operations,  assets,  or financial  condition,
except where contested in good faith and by appropriate proceedings.

         6.5      Inspection of Properties and Books.

         Permit authorized  representatives of the Bank to discuss the business,
operations,  assets and financial  condition of the Company and its Subsidiaries
with their  officers,  employees and  accountants  and to examine their books of
account,  as such  relate to this Loan  Agreement,  and make  copies or extracts
thereof,  and visit any  properties  which secure  Mortgage  Loans,  all at such
reasonable times as the Bank may reasonably request.

         6.6      Notice.

         Give prompt written notice (and the details thereof,  if applicable) to
the Bank of (a) any  action,  suit or  proceeding  instituted  by or against the
Company or any of its  Subsidiaries  in any federal or state court or before any
arbitration  or  dispute  resolution  organization,   any  commission  or  other
regulatory  body  (federal,  state or local,  domestic or foreign),  or any such
proceedings  threatened  against  the  Company,  (b) the  filing,  recording  or
assignment  of any  federal,  state or local tax lien  against it, or any of its
assets or any of its  Subsidiaries,  (c) the  occurrence of any Event of Default
hereunder or the occurrence of any Default and continuation thereof for five (5)
days, or (d) any other  action,  event or condition of any nature which may lead
to or result in a material adverse effect upon the business, operations, assets,
or financial  condition of the Company or which, with or without notice or lapse
of time  or  both,  would  constitute  a  default  under  any  other  agreement,
instrument or indenture to which the Company is a party or to which the Company,
its properties or assets may be subject.

                                       17
<PAGE>

         6.7      Payment of Debt, Taxes etc.

         Pay  and  perform  all  obligations  of  the  Company  promptly  and in
accordance  with the terms thereof and pay and discharge or cause to be paid and
discharged  promptly all taxes,  assessments and governmental  charges or levies
imposed upon the Company or upon its income,  receipts or properties  before the
same shall  become past due, as well as all lawful  claims for labor,  materials
and supplies or otherwise  which, if unpaid,  might become a Lien or charge upon
such properties or any part thereof;  provided,  however, that the Company shall
not be required to pay taxes,  assessments or governmental  charges or levies or
claims  for  labor,  materials  or  supplies  for which the  Company  shall have
obtained an adequate bond or adequate  insurance or which are being contested in
good faith and by proper  proceedings  which are being reasonably and diligently
pursued.

         6.8      Insurance.

         Maintain  (a) errors and  omissions  insurance  or mortgage  impairment
insurance and blanket bond coverage,  with such companies and in such amounts as
shall  satisfy  prevailing  Investor  requirements  applicable  to  a  qualified
mortgage originating  institution and in a minimum amount of $500,000.00 and (b)
liability insurance and fire and other hazard insurance on its properties,  with
responsible  insurance  companies  approved  by the Bank,  in such  amounts  and
against such risks as are customarily carried by similar businesses operating in
the same  vicinity;  and (c) within thirty (30) days after notice from the Bank,
obtain such additional  insurance as the Bank shall reasonably  require,  all at
the sole expense of the Company.  Copies of such policies  shall be furnished to
the Bank without charge upon request of the Bank.

         6.9      Insured Closings.

         Obtain and  maintain in effect at all times an insured  closing  letter
from each title  insurance  company  from which  mortgagee  title  insurance  is
procured,  indemnifying  and holding the Company  harmless  from and against the
failure of the agents  and  approved  title  attorneys  of such title  insurance
companies to comply with the written  closing  instructions of the Company as to
the Mortgage Loans  included in the Pledged  Mortgages and provide the Bank with
evidence  of the same from  time to time upon  request.  The  Company  agrees to
indemnify  and hold the Bank  harmless  from and  against  any  loss,  including
reasonable attorneys' fees and costs,  attributable to the failure of such title
insurance company, agent or approved attorney to comply with the disbursement or
instruction  letter or letters of the  Company or of the Bank  relating  to such
Mortgage Loans included in the Pledged Mortgages.

         6.10     [Reserved].

                                       18
<PAGE>

         6.11     Other Loan Obligations.

         Perform all obligations  under the terms of each loan agreement,  note,
mortgage, security agreement or debt instrument by which the Company is bound or
to which any of its property is subject, and promptly notify the Bank in writing
of the cancellation or reduction of any of its other mortgage  warehousing lines
of credit or agreements with any other lender.

         6.12     Use of Proceeds of Advances.

         Use the  proceeds of each  Advance  solely for the purpose of financing
the origination by the Company of the Pledged Mortgages.

         6.13     Special Affirmative Covenants Concerning Collateral.

                  (a) The Company warrants and will defend the right,  title and
         interest of the Bank in and to the Pledged Mortgages against the claims
         and demands of all persons whomsoever.

                  (b) The  Company  shall  service or cause to be  serviced  all
         Pledged  Mortgages in  accordance  with  standard  requirements  of the
         issuers of Purchase  Commitments  covering the same and all relating to
         residential construction mortgages, including without limitation taking
         all actions  necessary to enforce the obligations of the obligors under
         such  Mortgage  Loans  included in the Pledged  Mortgages.  The Company
         shall hold all escrow funds collected in respect of Pledged  Mortgages,
         without  co-mingling the same with  non-custodial  funds, and apply the
         same for the purposes for which such funds were collected.

                  (c) The  Company  shall  execute  and deliver to the Bank such
         Uniform  Commercial  Code  financing  statements  with  respect  to the
         Collateral as the Bank may reasonably  request.  The Company shall also
         execute  and  deliver  to the Bank such  further  instruments  of sale,
         pledge or assignment or transfer,  as reasonably  required by the Bank,
         and shall do and perform all matters and things reasonably necessary or
         desirable  to be  done or  observed,  for the  purpose  of  effectively
         creating, maintaining and preserving the security and benefits intended
         to be afforded the Bank under this Loan Agreement.  The Bank shall have
         all the rights and remedies of a secured party under the South Carolina
         Uniform  Commercial  Code, or any other  applicable law, in addition to
         all rights provided for herein.

                  (d) The Company  shall notify the Bank within two (2) Business
         Days of any  default  under,  or of the  termination  of, any  Purchase
         Commitment relating to any Pledged Mortgage.

                  (e) The Company will promptly  comply in all respects with the
         terms and conditions of all Purchase  Commitments,  and all extensions,
         renewals and modifications or substitutions thereof or thereto.

                                       19
<PAGE>

                  (f) The Company shall maintain,  at its principal office or in
         a regional  office approved by the Bank, or in the office of a computer
         service  bureau  engaged by the Company and approved by the Bank,  and,
         upon request,  shall make available to the Bank the following documents
         or  instruments  entered into and/or  delivered in connection  with the
         Pledged  Mortgages:  (i)  the  originals  of  its  Mortgage  Notes  and
         Mortgages,  (ii)  copies of all related  Mortgage  Loan  documents  and
         instruments,    and   (iii)   all   files,    surveys,    certificates,
         correspondence,  appraisals,  computer programs,  tapes,  discs, cards,
         accounting  records  and other  information  and data  relating  to the
         Collateral, in each case, which the Company has not previously provided
         to the Bank in accordance  with the procedures set forth in Section 2.2
         or Exhibit C hereof.

         6.14     Reserved.

         6.15     Deposit Account.

         At all  times  during  the term  hereof  and  while  any  Advance  made
hereunder remains outstanding, the Company shall maintain a deposit account with
the Bank in  order to  facilitate  the  making  of  Advances  and the  repayment
thereof.  The Company shall cause all sales  proceeds due it from  Investors who
have purchased  Mortgage Loans and all principal and fee repayments  received on
Mortgage  Loans which have been  pledged to the Bank  hereunder  to be deposited
into a deposit account with the Bank.

VII. NEGATIVE COVENANTS.

         The Company  agrees that so long as the  Commitment is  outstanding  or
there remains any obligation of the Company to be paid or performed hereunder or
under the Note, the Company shall not,  either  directly or indirectly,  without
the prior written consent of the Bank:

         7.1      Merger; Sale of Assets; Acquisitions.

         Liquidate,  dissolve, consolidate or merge or sell any substantial part
of its assets  (except  as  otherwise  permitted  by this Loan  Agreement),  nor
acquire substantially all of the assets of another.

         7.2      Special Negative Covenants Concerning Collateral.

                  (a) The Company shall not amend or modify, or waive any of the
         terms and  conditions  of, or settle or compromise any claim in respect
         of, any Pledged Mortgages.

                  (b) The Company shall not sell, assign,  transfer or otherwise
         dispose of, or grant any option with respect to, or pledge or otherwise
         encumber (except as otherwise  permitted by this Loan Agreement) any of
         the Collateral or any interest therein.

                                       20
<PAGE>

                  (c) The Company shall not make any  compromise,  adjustment or
         settlement  in respect of any of the  Collateral  or accept  other than
         cash in payment or liquidation of the Collateral.

         7.3      ADDITIONAL INDEBTEDNESS

                  The  Company  shall  not incur any  indebtedness  (other  than
         indebtedness  owed to affiliates  of Company)  without the Bank's prior
         consent which consent shall not be unreasonably withheld.

VIII. DEFAULTS; REMEDIES.

         8.1      Events of Default.

         The occurrence of any of the following conditions or events shall be an
event of default ("Event of Default"):

                  (a) Failure to pay the principal of or interest on any Advance
         when due,  whether at stated maturity,  by acceleration,  under Section
         2.5(b)  hereof,  or  otherwise,  or failure to pay any other amount due
         under this Loan Agreement within three days after written  notification
         by the Bank stating that Borrower has failed to make such other payment
         under the terms of this Loan  Agreement;  or failure to pay, beyond any
         applicable  grace  period,  the  principal  or  interest  on any  other
         indebtedness due the Bank; or

                  (b)  Failure  of the  Company  to pay,  or any  default in the
         payment of any principal or interest on, any other  indebtedness  or in
         the  payment of any  contingent  obligation  beyond any period of grace
         provided;  or breach or default with respect to any other material term
         of any other indebtedness or of any loan agreement, mortgage, indenture
         or other  agreement  relating  thereto,  if the effect of such failure,
         default  or breach is to cause,  or to  permit  the  holder or  holders
         thereof  (or a trustee on behalf of such  holder or  holders) to cause,
         indebtedness  of the Company to become or be declared  due prior to its
         stated maturity (upon the giving or receiving of notice, lapse of time,
         both, or otherwise); or

                  (c)  Failure  of the  Company,  or the  attorney  closing  any
         Mortgage Loan included in the Pledged Mortgages, to deliver to the Bank
         within four (4) Business  Days of such  Mortgage Loan closing for which
         the Bank has made an Advance to the Company, the original Mortgage Note
         executed by the  borrower(s),  the  Collateral  Assignment  of Note and
         Mortgage or a mutually agreed upon electronic  alternative thereto, and
         either the  original,  executed and recorded  mortgage  evidencing  the
         mortgage,  or, if such  mortgage is not then  available,  a copy of the
         executed  mortgage  evidencing the mortgage with recording  information
         noted  thereon,  and such default shall not have been  remedied  within
         three (3) Business Days after  receipt of written  notice from the Bank
         of such default; or

                                       21
<PAGE>

                  (d) Failure of the Company to perform, or comply with any term
         or condition  applicable to it contained in Sections 6.3,  6.12,  6.13,
         6.14 or Article VII of this Loan Agreement; or

                  (e) Any of the Company's  representations  or warranties  made
         herein or in any  statement  or  certificate  at any time  given by the
         Company in writing  pursuant hereto or in connection  herewith shall be
         false in any material respect on the date as of which made; or

                  (f)  The  Company  shall  default  in  the  performance  of or
         compliance  with any term contained in this Loan  Agreement  other than
         those referred to above in subsections (a), (c) or (d) and such default
         shall not have been  remedied or waived  within  thirty (30) days after
         receipt of notice from the Bank of such default; or

                  (g) (1) A court  having  jurisdiction  shall enter a decree or
         order for relief in respect of the  Company or of any  Guarantor  in an
         involuntary case under any applicable  bankruptcy,  insolvency or other
         similar law now or  hereafter  in effect,  which decree or order is not
         stayed;  or (2) any other  similar  relief  shall be granted  under any
         applicable federal or state law; or a decree or order of a court having
         jurisdiction   for  the   appointment   of  a   receiver,   liquidator,
         sequestrator,  trustee,  custodian,  or other  officer  having  similar
         powers over the Company or any of its Subsidiaries or of any Guarantor,
         or over all or a substantial part of their respective  property,  shall
         have  been  entered;  or  the  involuntary  appointment  of an  interim
         receiver,  trustee  or other  custodian  of the  Company  or any of its
         Subsidiaries or of any Guarantor for all or a substantial part of their
         respective  property;  or the  issuance  of a  warrant  of  attachment,
         execution  or  similar  process  against  any  substantial  part of the
         property of the Company or any of its Subsidiaries or of any Guarantor,
         and the continuance of any such events in (2) above for sixty (60) days
         unless dismissed, bonded off or discharged; or

                  (h) The  Company  or any  Guarantor  shall  have an order  for
         relief  entered with respect to it, or shall  commence a voluntary case
         under any applicable  bankruptcy,  reorganization,  insolvency or other
         similar law now or hereafter in effect,  or shall  consent to the entry
         of an order for relief in an involuntary  case, or to the conversion to
         an  involuntary  case,  under any such  law,  or shall  consent  to the
         appointment  of or taking  possession  by a receiver,  trustee or other
         custodian for all or a substantial part of its property;  the making by
         the  Company  or any  of  its  Subsidiaries  or  any  Guarantor  of any
         assignment for the benefit of creditors; or the inability or failure of
         the Company or of any Guarantor, or the admission by the Company or any
         Guarantor  in writing of its  inability  to pay its debts as such debts
         become due; or

                  (i) Any money  judgment,  writ or  warrant of  attachment,  or
         similar process shall be entered or filed against the Company or any of
         its  respective  assets  and  shall  remain  undischarged,   unvacated,
         unbonded or  unstayed  for a period of thirty (30) days or in any event
         later  than  five (5)  days  prior  to the  date of any  proposed  sale
         thereunder; or

                                       22
<PAGE>

                  (j) Any order, judgment or decree shall be entered against the
         Company  decreeing the  dissolution or split up of the Company and such
         order shall remain  undischarged  or unstayed for a period in excess of
         thirty (30) days; or

                  (k) The  Company  shall  purport  to disavow  its  obligations
         hereunder or shall contest the validity or  enforceability  hereof;  or
         the Bank's  security  interest on any portion of the  Collateral  shall
         become  unenforceable or otherwise impaired;  provided that, subject to
         the Bank's  approval,  no Event of Default  shall  occur as a result of
         such impairment if all Advances made against any such Collateral  shall
         be paid in full within ten (10) days of the date of such impairment.

         8.2      Remedies.

                  (a) Upon the  occurrence of any Event of Default  described in
         Section  8.1(g) or (h),  the  Commitment  shall be  terminated  and the
         unpaid  principal  amount of and  accrued  interest  on the Note  shall
         automatically become due and payable,  without  presentment,  demand or
         other  requirements  of any  kind,  all of which are  hereby  expressly
         waived by the Company.

                  (b) Upon the  occurrence  of any Event of  Default  other than
         those specified in 8.2(a) above, the Bank may, by written notice to the
         Company,  terminate the Commitment and/or declare all or any portion of
         the Advances to be due and payable  whereupon the same shall  forthwith
         become due and payable, together with all accrued interest thereon, and
         the obligation of the Bank to make Advances shall thereupon terminate.

                  (c) Upon the occurrence of any Event of Default,  the Bank may
         also do any of the following:

                      (1)  Foreclose  upon or  otherwise  enforce  its  security
         interest  in and Lien on the  Collateral  to secure  all  payments  and
         performance  of  obligations  owed  by  the  Company  under  this  Loan
         Agreement.

                      (2) Notify all obligors of Collateral  that the Collateral
         has been  assigned to the Bank and that all payments  thereon are to be
         made  directly to the Bank or such other party as may be  designated by
         the Bank;  settle,  compromise,  or release,  in whole or in part,  any
         amounts  owing on the  Collateral,  any such obligor or Investor or any
         portion of the  Collateral,  on terms  acceptable to the Bank;  enforce
         payment and prosecute any action or proceeding  with respect to any and
         all Collateral;  and where any such Collateral is in default, foreclose
         on and enforce security  interests in, such Collateral by any available
         judicial  procedure  or  without  judicial  process  and sell  property
         acquired as a result of any such foreclosure.

                                       23
<PAGE>

                      (3)  Act,  or  contract  with a third  party  to  act,  as
         servicer of each item of Collateral requiring servicing and perform all
         obligations  required in  connection  with Purchase  Commitments,  such
         third party's fees to be paid by the Company.

                      (4) Exercise all rights and remedies of a secured creditor
         under the South Carolina  Uniform  Commercial  Code,  including but not
         limited to selling the Collateral at public or private sale,  including
         sale pursuant to any  applicable  Purchase  Commitment.  The Bank shall
         give the Company not less than ten (10) days' notice of any such public
         sale or of the date after which  private sale may be held.  The Company
         agrees that ten (10) days' notice shall be  reasonable  notice.  At any
         such sale the  Collateral  may be sold as an  entirety  or in  separate
         parts,  as the Bank may  determine.  The Bank  may,  without  notice or
         publication, adjourn any public or private sale or cause the same to be
         adjourned from time to time by announcement at the time and place fixed
         for the  sale,  and such sale may be made at any time or place to which
         the same may be so adjourned. In case of any sale of all or any part of
         the Collateral on credit or for future delivery, the Collateral so sold
         may be  retained  by the Bank  until the  selling  price is paid by the
         purchaser  thereof,  but the Bank shall not incur any liability in case
         of the failure of such  purchaser to take up and pay for the Collateral
         so sold and, in case of any such failure,  such Collateral may again be
         sold upon like notice. The Bank may, however, instead of exercising the
         power of sale herein  conferred  upon it, proceed by a suit or suits at
         law or in equity to collect all amounts due upon the  Collateral  or to
         foreclose  the pledge and sell the  Collateral  or any portion  thereof
         under  a  judgment  or  decree  of  a  court  or  courts  of  competent
         jurisdiction, or both.

                      (5) Proceed against the Company on the Note or against the
         Guarantor under the Guaranty or both.

                  (d) Any private sale of the Collateral held by or on behalf of
         the Bank shall be conducted in a commercially reasonable manner.

                  (e) The  Company  waives any right to require  the Bank to (1)
         proceed  against any person,  (2) proceed against or exhaust any of the
         Collateral or pursue its rights and remedies as against the  Collateral
         in any particular  order,  or (3) pursue any other remedy in its power.
         The Bank shall not be required to take any steps  necessary to preserve
         any rights of the Company against holders of mortgages prior in lien to
         the lien of any  Mortgage  included  in the  Collateral  or to preserve
         rights against prior parties.

                  (f) The Bank may, but shall not be obligated  to,  advance any
         sums or do any act or thing  necessary  to uphold and  enforce the Lien
         and  priority  of,  or the  security  intended  to be  afforded  by any
         Mortgage  included in the  Collateral  including,  without  limitation,
         payment of delinquent taxes or assessments and insurance premiums.  All
         advances, charges, costs and expenses,  including reasonable attorneys'
         fees and disbursements,  incurred or paid by the Bank in exercising any
         right,  power or remedy  conferred  by this Loan  Agreement,  or in the
         enforcement  hereof,  together  with interest  thereon,  at the rate of

                                       24
<PAGE>

         interest  specified in the Note, from the time of payment until repaid,
         shall become a part of principal balance outstanding under the Note.

                  (g) No  failure  on the part of the Bank to  exercise,  and no
         delay in exercising,  any right, power or remedy provided hereunder, at
         law or in  equity  shall  operate  as a waiver  thereof;  nor shall any
         single or partial  exercise  by the Bank of any right,  power or remedy
         provided  hereunder,  at law or in equity preclude any other or further
         exercise  thereof or the exercise of any other right,  power or remedy.
         Without  intending to limit the  foregoing,  all defenses  based on the
         statute of limitations  are hereby waived by the Company.  The remedies
         herein  provided are  cumulative  and are not exclusive of any remedies
         provided at law or in equity.

         8.3      Application of Proceeds.

         The proceeds of any sale or other  enforcement  of the Bank's  security
interest in all or any part of the Collateral shall be applied by the Bank:

         First,  to the  payment  of the  costs  and  expenses  of such  sale or
enforcement, including reasonable compensation to the Bank's agents and counsel,
and all expenses,  liabilities  and advances made or incurred by or on behalf of
the Bank in connection therewith;

         Second,  to the payment of any other amounts due (other than  principal
and interest) under the Note or this Loan Agreement;

         Third, to the payment of interest accrued and unpaid on the Note;

         Fourth,  to the  payment of the  outstanding  principal  balance of the
Note; and

         Fifth, to the payment to the Company,  or to its successors or assigns,
or as a  court  of  competent  jurisdiction  may  direct,  of any  surplus  then
remaining from such proceeds.  If the proceeds of any such sale are insufficient
to cover the costs and expenses of such sale, as  aforesaid,  and the payment in
full of the Note and all other amounts due  hereunder,  the Company shall remain
liable for any deficiency.

         8.4      Bank Appointed Attorney-in-Fact.

         The Bank is hereby appointed the attorney-in-fact of the Company,  with
full power of  substitution,  for the  purpose of  carrying  out the  provisions
hereof and taking any action and  executing any  instruments  which the Bank may
deem  necessary  or  advisable  to  accomplish  the  purposes,   hereof,   which
appointment as  attorney-in-fact  is  irrevocable  and coupled with an interest.
Without limiting the generality of the foregoing,  the Bank shall have the right
and power to give  notices of its  security  interest in the  Collateral  to any
person,  either  in the name of the  Company  or in its own  name,  to  receive,

                                       25
<PAGE>

collect,  demand, and sue for all payments and sums of money which may now be or
hereafter  become due and owing,  to the  Company,  on, for, or by reason of any
Pledged Mortgages,  to endorse all Pledged Mortgages payable to the order of the
Company, to receive, endorse and collect all checks made payable to the order of
the Company  representing any payment on account of the principal of or interest
on, or the  proceeds  of sale of, any of the Pledged  Mortgages,  to endorse all
Pledged Mortgages payable to the order of the Company, or to give full discharge
for the same, to attach to the  Assignments  of Notes and Mortgages  executed by
the  Company  lists of all  Mortgage  Loans  and to  record  same in any and all
necessary or applicable  recording  offices in order to perfect Bank's  security
interest in the Collateral.

8.5      Right of Set-Off.

         If the Company shall  default in the payment of the Note,  any interest
accrued thereon,  or any other sums which may become payable hereunder when due,
or in the performance of any of its other  obligations or liabilities under this
Loan Agreement,  the Bank,  shall have the right but not the obligation,  at any
time and from time to time,  without  notice,  to set-off and to  appropriate or
apply any and all deposits of money or property or any other indebtedness at any
time  held or owing  by the  Bank to or for the  credit  of the  account  of the
Company against and on account of the obligations and liabilities of the Company
under the Note and this Loan Agreement,  irrespective of whether or not the Bank
shall have made any demand  hereunder  and whether or not said  obligations  and
liabilities shall have matured,  provided,  however, that the aforesaid right of
set-off shall not apply to any deposits of escrow monies being held on behalf of
the mortgagors under Mortgage Loans or other third parties.

IX. NOTICES.

         All  notices,  demands,  consents,  requests  and other  communications
required or permitted to be given or made  hereunder  (collectively,  "Notices")
shall, except as otherwise expressly provided hereunder, be in writing and shall
be delivered in person or  telegraphed  or mailed,  first class,  return receipt
requested,  postage prepaid, addressed to the respective parties hereto at their
respective  addresses  hereinafter  set forth or, as to any such party,  at such
other address as may be  designated by it in a Notice to the other.  All Notices
shall be  conclusively  deemed  to have  been  properly  given or made when duly
delivered,  in  person,  or if  mailed  on the third  Business  Day after  being
deposited in the mails or when delivered to the telegraph company,  addressed as
follows:

                         If to the Company:

                         Community Resource Mortgage, Inc.
                         508 Hampton Street
                         Columbia, South Carolina 29201
                         Attn: President

                                       26
<PAGE>

                         with a copy to:

                         Community Bankshares, Inc.
                         791 Broughton Street
                         Orangeburg, SC 29116
                         Attn: William W. Traynham

                         If to the Bank:

                         Branch Banking and Trust Company
                         Post Office Box 628
                         Monroe, North Carolina 28111-0628
                         Attention: Mr. Clegg E. Sell, Jr.

X. REIMBURSEMENT OF EXPENSES; INDEMNITY.

         The Company shall (a) pay all  out-of-pocket  costs and expenses of the
Bank,  including  reasonable  attorney's fees actually incurred at normal hourly
rates, in connection with the enforcement of this Loan Agreement,  the Note, and
other documents and  instruments  related hereto and the making and repayment of
the Advances and the payment of interest thereon; (b) pay, and hold the Bank and
any holder of the Note harmless from and against, any and all present and future
stamp, documentary and other similar taxes with respect to the foregoing matters
and save the  Bank and the  holder  or  holders  of the Note  harmless  from and
against any and all  liabilities  with respect to or resulting from any delay or
omission to pay such taxes;  (c)  indemnify,  pay and hold harmless the Bank and
any of its officers, directors, employees or agents and any subsequent holder of
the Note from and against any and all liabilities, obligations, losses, damages,
penalties,  judgments,  suits,  costs,  expenses and  disbursements  of any kind
whatsoever  (the  "Indemnified  Liabilities")  (excluding  any such  Indemnified
Liabilities resulting from failure by the Bank to perform any of its obligations
under this Loan Agreement, the Note, or any other document referred to herein as
established  in a suit  between  the  Company and the Bank which may be the same
suit in which  indemnification  is being sought hereunder by the Bank) which may
be imposed upon,  incurred by or asserted against the Bank or such holder in any
way relating to or arising out of this Loan  Agreement,  the Note,  the Mortgage
Notes,  or any other  document  referred  to  herein or any of the  transactions
contemplated  hereby  or  thereby  to  the  extent  that  any  such  Indemnified
Liabilities  result  (directly  or  indirectly)  from any  claims  made,  or any
actions,  suits or proceedings  commenced or threatened,  by or on behalf of any
creditor  (excluding  the Bank and the holder or holders of the Note),  security
holder,  shareholder,  customer  (including,  without limitation,  any person or
entity  having any dealings of any kind with the  Company),  trustee,  director,
officer,  employee  and/or  agent of the Company  acting in such  capacity,  the
Company or any governmental  regulatory body or authority (excluding the Federal
Reserve Board, the Federal Deposit Insurance Corporation, the Comptroller of the
Currency and any other banking regulatory body or authority having  jurisdiction
over the Bank).

                                       27
<PAGE>

XI. DELIVERIES OF COLLATERAL DOCUMENTS.

         The Company  shall  deliver,  or cause to be  delivered to the Bank all
Pledged  Mortgages  and  related  documents,  in  accordance  with  the  General
Operational  Guidelines set forth on Exhibit D attached hereto or, as applicable
all Pledged Mortgages to (1) an Investor which has issued a Purchase  Commitment
with respect thereto for its  examination and purchase,  against a bailee letter
in form  approved by the Bank or the  applicable  FNMA or FHLMC  delivery  form,
completed in a manner  reasonably  satisfactory to the Bank, or (2) FNMA for its
examination and purchase against a properly  executed FNMA "Mortgage  Submission
Voucher"  designating  the Bank as the payee or for the account of the Bank. The
Bank may deliver any  document  relating  to the  Collateral  to the Company for
correction or completion  against a properly  executed trust receipt in the form
approved by the Bank with  instructions  to the Company to return the  corrected
document to the Bank or the Investor,  as appropriate,  within ten (10) Business
Days after such delivery or redeem the Mortgage Loan from pledge.

XII. FINANCIAL INFORMATION.

         All certified  financial  statements and reports  furnished to the Bank
hereunder  shall  be  prepared  in  accordance  with  GAAP,  applied  on a basis
consistent with that applied in preparing the certified financial  statements as
at, and for the period ended (except to the extent otherwise required to conform
to good  accounting  practice).  It is understood  and agreed that the financial
reports to be provided by the Company  pursuant to the Section 6.2(c) hereof may
be prepared by the Company  internally and shall not be required to be certified
by the Company's independent public accountant.

XIII. MISCELLANEOUS.

         13.1     Terms Binding Upon Successors; Survival of Representations.

         The terms and provisions of this Loan  Agreement  shall be binding upon
and inure to the benefit of the parties hereto and their  respective  successors
and assigns.  All representations,  warranties,  covenants and agreements herein
contained on the part of the Company shall survive the making of any Advance and
the execution of the Note,  and shall be effective so long as the  Commitment is
outstanding  or there remains any  obligation of the Company  hereunder or under
the Note to be paid or performed.

         13.2     Assignment.

         This Loan  Agreement  may not be  assigned  by the  Company.  This Loan
Agreement and the Note, along with the Bank's security interest in any or all of
the  Collateral,  may, at any time, be transferred  or assigned,  in whole or in
part, by the Bank, and any assignee thereof may enforce this Loan Agreement, the
Note and such security interest.

                                       28
<PAGE>

         13.3     Amendments.

         Except  as  otherwise  provided  in  this  Loan  Agreement,  this  Loan
Agreement may not be amended,  modified or  supplemented  unless such amendment,
modification  or  supplement  is set  forth in a writing  signed by the  parties
hereto.

         13.4     Governing Law.

         This Loan  Agreement  and the Note shall be governed by the laws of the
State of South  Carolina,  without  reference to its  principles of conflicts of
laws.

         13.5     Consent to Jurisdiction.

         The Company hereby agrees that any action or proceeding under this Loan
Agreement or any document  delivered pursuant hereto may be commenced against it
in any court of competent  jurisdiction  within the State of South Carolina,  by
service of process upon the Company by first class registered or certified mail,
return receipt requested,  addressed to the Company at its address last known to
the Bank. The Company hereby waives any objection to the venue of any such suit,
action or  proceeding.  Nothing  herein  shall  affect  the right of the Bank to
accomplish  service  of  process  in any  other  manner  permitted  by law or to
commence legal proceedings or otherwise proceed against the Company in any other
jurisdiction or court.

         13.6     Relationship of the Parties.

         This Loan Agreement provides for the making of Advances by the Bank, in
its capacity as a lender, to the Company, in its capacity as a borrower, and for
the payment of interest  and  repayment of principal by the Company to the Bank.
The   relationship   between  Bank  and  the  Company  is  limited  to  that  of
creditor/secured party, on the one hand, and debtor/pledgor,  on the other hand.
The provisions  herein for compliance  with financial  covenants and delivery of
financial  statements are intended solely for the benefit of the Bank to protect
its  interests  as lender in  assuring  payments of interest  and  repayment  of
principal,  and nothing  contained in this Loan Agreement  shall be construed as
permitting or obligating  the Bank to act as a financial or business  advisor or
consultant to the Company,  as permitting or obligating  the Bank to control the
Company or to conduct  the  Company's  operations,  as  creating  any  fiduciary
obligation  on the part of the Bank to the  Company,  or as  creating  any joint
venture,  agency,  or other  relationship  between  the  parties  other  than as
explicitly  and  specifically  stated  in  this  Loan  Agreement.   The  Company
acknowledges that it has had the opportunity to obtain the advice of experienced
counsel of its own choosing in connection  with the negotiation and execution of
this Loan Agreement and to obtain the advice of such counsel with respect to all
matters  contained  herein.   The  Company  further   acknowledges  that  it  is
experienced  with respect to financial  and credit  matters and has made its own
independent decisions to apply to the Bank for credit and to execute and deliver
this Loan Agreement.

                  [Remainder of page intentionally left blank]

                                       29
<PAGE>

         IN WITNESS WHEREOF,  the parties hereto have caused this Loan Agreement
to be duly executed as a sealed instrument as of the date first above written.

                                     COMMUNITY RESOURCE MORTGAGE, INC.

                                     By: ---------------------------------------
ATTEST:                                   A. Wade Douroux
                                          President

--------------------------
Secretary

(Corporate Seal)

                                     BRANCH BANKING AND TRUST COMPANY    (Seal)

                                     By: ---------------------------------------
                                          Clegg E. Sell, Jr.
                                          Senior Vice President

                                       30
<PAGE>

                                    EXHIBIT A
                           FORM OF GUARANTY AGREEMENT

                                       31
<PAGE>

                                    EXHIBIT B
                   ADVANCE REQUEST AND OFFICER'S CERTIFICATION

         Pursuant to that certain  Warehouse Credit and Security  Agreement (the
"Loan  Agreement")  dated  October 5, 2004,  between  BRANCH  BANKING  AND TRUST
COMPANY (the "Bank") and COMMUNITY RESOURCE MORTGAGE, INC. (the "Company"),  and
pursuant to the Promissory  Note of even date therewith  given by the Company to
the Bank in the stated  principal  amount of $ 20,000,000.00  (the "Note"),  the
undersigned,  on behalf of the Company, hereby requests from the Bank an advance
in the amount of $ ___________ (the "Advance") to be made in accordance with and
subject to all the terms and conditions of the Loan  Agreement.  All capitalized
terms used and not otherwise  defined herein shall have the meanings assigned to
them in the Loan Agreement.

DESCRIPTION OF THE MORTGAGE NOTES

Date for which Advance is requested:                    (must be a Business Day)
                                       -----------------

Name and Address of Mortgage Loan:
                                       -----------------------------------------

                                       -----------------------------------------

                                       -----------------------------------------

Loan Number:
                                       -----------------------------------------

                                       -----------------------------------------

[For Initial Requests only:
Date and time of Closing:              ----------------------@------------------

Name of Settlement Agent:
                                       -----------------------------------------
Address of Settlement Agent:
                                       -----------------------------------------

                                       -----------------------------------------

                                       -----------------------------------------

Settlement Agent Telephone Number:
                                       -----------------------------------------
Settlement Agent Fax Number:]
                                       -----------------------------------------

Bank to  credit  funds to  Borrower's  account  no.-----------------  at  Branch
Banking and Trust Company.

                                       -----------------------------------------
Total Credit Amount:
                                       -----------------------------------------

                                       32
<PAGE>

DESCRIPTION OF THE PURCHASE COMMITMENT

Commitment
Issuer's Name         Date of Issuance        Commitment           Total Amount
and Address           of Commitment           Expiration Date     of Commitment
-----------           -------------           ---------------     -------------

         The undersigned, presently  ____________________________________ of the
Company,  has  personally  examined the  documents in the  Company's  possession
relating to the Mortgage Loan.  Based on such  examination,  upon the closing of
the  Mortgage  Loan  and upon  the  Bank's  approval  of the  Mortgage  Loan and
agreement  to make the  requested  Advance,  the  Company  (i) will  have in its
possession  with  respect to the Mortgage  Loan all of the items  referred to in
Exhibit C of the Loan Agreement; (ii) shall hold all such items in trust for the
Bank as its  Collateral;  and (iii)  shall place all of such items in a separate
loan file,  segregated  from other loan files of the Company  and  appropriately
marked to indicate the security  interest  given hereby to the Bank  pursuant to
the terms of the Loan  Agreement.  The Company agrees at any time to deliver the
pledged  Collateral  Documents  to the Bank or to any person  designated  by the
Bank, upon written instructions from the Bank.

         Attached hereto is (a) an unrecorded but recordable original,  executed
and  acknowledged  Collateral  Assignment  of Note and  Mortgage,  or a mutually
agreed upon  electronic  alternative  thereto and (b) a true and correct copy of
the Purchase  Commitment.  The Company has satisfied all conditions precedent to
the Investor's obligations under the Purchase Commitment, which is in full force
and effect. There is no event of default, or condition which, with the giving of
notice or lapse of time or both could become an event of default, under the Loan
Agreement.  The Mortgage  Loan  satisfies  all  applicable  representations  and
warranties  set  forth in the Loan  Agreement,  and after  giving  effect to the
Advance,  the  Collateral  Value of all Mortgage  Loans  pledged  under the Loan
Agreement shall not exceed the aggregate Advances made thereunder.

         Given this ______day of _________________________, 200___.

                                            ________________________ (SEAL)
                                      Name: _________________________

                                       33
<PAGE>

                                    EXHIBIT C
                       PROCEDURES FOR REQUESTING ADVANCES
                            AND COLLATERAL DOCUMENTS

         These Procedures For Requesting Advances and Collateral  Documents (the
"Procedures") are to describe the procedures for requesting  advances under that
certain line of credit extended by Branch Banking and Trust Company  ("Bank") to
Community  Resource  Mortgage,  Inc.  ("Company")  pursuant to the terms of that
certain  Warehouse  Credit and Security  Agreement  dated October 5, 2004 ("Loan
Agreement") to which these Procedures are attached.  All capitalized  terms used
in these Procedures not defined herein shall have the meanings  assigned to them
in the Loan Agreement.  These  procedures are intended to supplement the General
Operational  Guidelines  attached  as  Exhibit  D to  the  Loan  Agreement  (the
"Guidelines")  and  are  not  meant  to  release  the  Company  from,  or  be  a
substitution  for, any requirement  set forth in the Guidelines.  The Company is
expected to comply with these Procedures and the Guidelines, except in the event
of a conflict,  in which event the Loan  Agreement  or, if not  addressed in the
Loan Agreement, the written instructions of the Bank, shall control.

         A. Procedures for Requesting Advances.  The Company shall make requests
for  Advances  by  submitting  to the  Bank an  Advance  Request  and  Officer's
Certification  in the form of Exhibit B (the  "Advance  Request").  Each Advance
Request  shall be executed in all indicated  spaces by an authorized  officer of
the Company and shall be properly  completed to indicate:  (i) the amount of the
Advance(s)  requested;  (ii) the date,  the principal  amount,  the names of the
makers of each Mortgage Note offered as security for an Advance, and the address
of the  residential  property  securing each of such Mortgage Note; and (iii) if
the  Advance  Request  pertains  to an Initial  Request,  the name,  address and
telephone number of the closing attorney(s) responsible for closing the Mortgage
Loan(s)  identified in the Advance  Request;  and, (iv) the Purchase  Commitment
pursuant to which the Company  intends to sell the identified  Mortgage Loans by
showing the name and address of the  Investor  issuing the  Purchase  Commitment
(the "Committed Purchaser"),  the date of the Purchase Commitment,  the date the
Purchase  Commitment  expires and the committed  purchase price set forth in the
Purchase Commitment.

         B.  Documents to be Submitted  with Each Initial  Request.  The Company
shall submit together with each Initial Request  submitted by it to the Bank the
following documents and items:

                  1. A mutually agreed upon electronic alternative to Assignment
         of Note and Mortgage such as a MIN Number issued in connection with the
         Mortgage  Electronic  Recording  System (MERS) for all Mortgages in the
         Bank's possession.

                  2. A complete photocopy of the Purchase Commitment  identified
         in the  Advance  Request  certified  by an  authorized  officer  of the
         Company to be a true, accurate and complete copy of such Commitment.

                  3. A copy of the unsigned Mortgage Note.

                                       34
<PAGE>

                  4. A copy of the  Inspection  Sheet,  on  Bank's  pre-approved
         form.

         C. Documents to be Submitted  within Four Business Days of Each Initial
Request.  In addition to those items  identified in Section B above, the Company
shall submit to the Bank within four (4) Business  Days of each Initial  Request
made by the Bank the following documents and items with respect to each Mortgage
Loan securing such Advance:

         1. Each  original  executed  Mortgage  Note  identified  in the Initial
Request (together with any and all applicable executed allonges).

         D.  Documentation  to be made  available to the Bank upon  Request.  In
addition to those items  identified in Sections B and C above, the Company shall
procure and, upon reasonable  request,  make available to the Bank the following
items with respect to each Mortgage Loan  identified in the Advance  Request (at
the  Bank's  option  all  items  listed in Parts C and D hereof as may be in the
Company' s possession at the time the Advance Request is made shall be delivered
along with the  Advance  Request as a condition  precedent  to the making of the
requested Advance):

         1. A  complete  photocopy  of  each  executed  Mortgage  securing  each
Mortgage Note identified in the Advance Request certified to be a true, accurate
and complete copy of such Mortgage by an authorized officer of the Company or by
the  attorney or agent who closed the  Mortgage  Loan to which it  relates.  The
original  recorded  Mortgage  shall be  delivered to the Bank  immediately  upon
recordation unless the Mortgage Loan shall have been previously  released by the
Bank and the Advance relating thereto shall have been paid;

         2. A "clocked"  copy or a copy of the recording  receipt  issued by the
appropriate  public official for recording each recorded Mortgage  identified in
the Advance Request;

         3. A  photocopy  of a policy of title  insurance  issued by an  insurer
reasonably  acceptable to the Bank for each  Mortgage  identified in the Advance
Request insuring the Company,  its successors and assigns that the Mortgage is a
lien on fee  simple  absolute  title  to the  real  property  described  in such
Mortgage,  subject only to such  exceptions as are reasonably  acceptable to the
Bank.  The Bank will accept in lieu of a photocopy of the original  title policy
referred to in this Subparagraph C(4) a binder for such insurance  provided such
binder  remains  effective  for at least six (6) months  after its  issuance and
provided  further that the Company procures such title insurance policy promptly
and promptly submits a copy thereof to the Bank;

         4. A copy  of the HUD  Settlement  Statement  for  each  Mortgage  Loan
identified in the Advance Request signed by the customer(s)  receiving such loan
which shall have been provided by the Company to the  customer(s)  in accordance
with the Real Estate Settlement Procedures Act and Regulation X thereof;

         5. A copy of the  Disclosure  Statement  required to be provided to the
customer  by the Company  pursuant to the  Consumer  Credit  Protection  Act and
Regulation Z thereof;

                                       35
<PAGE>

         6. The  original  of a policy of title  insurance  issued by an insurer
reasonably  acceptable  to the Bank  insuring the Company,  its  successors  and
assigns,  that the Mortgage  representing  the Mortgage  Loan  identified in the
Advance  Request is a first lien on the fee  simple  absolute  title to the real
property  described in such  Mortgage,  subject only to such  exceptions  as are
reasonably acceptable to the Bank;

         7. A Certificate of Insurance  signed by an insurance  company or agent
reasonably  acceptable to the Bank evidencing that the real property  encumbered
by the Mortgage  identified in the Advance Request is insured against  builders'
risk, fire and other perils, as appropriate, with extended coverage in an amount
at least equal to the amount of such  Mortgage,  that the policy  providing such
insurance  contains a mortgagee clause on standard form naming the Company,  its
successors  and assigns,  as the loss payee and that such  insurance will not be
modified or canceled by the insurer  except after thirty (30) days prior written
notice to each insured mortgagee;

         8. A copy of the "subject to" appraisal of the real property  described
in the Mortgage  identified in the Advance  Request,  which appraisal shall have
been procured by the Company prior to making the Mortgage Loan evidenced by such
Mortgage and shall include pictures of such real property;

         9. A  Certificate  of Flood  Insurance  if the  encumbered  property is
located in a flood plain hazard zone;

         10. A copy of the Credit  Application  signed by the customer receiving
the  Mortgage  Loan  identified  in the Advance  Request and  submitted  by such
customer to the Company in connection  with such Mortgage Loan and a copy of the
Credit  Report  obtained by the Company  with respect to such  customer,  all of
which shall be in such form as would be necessary  to qualify the Mortgage  Loan
for purchase by FNMA or FHLMC or other approved Investors  identified on Exhibit
F pursuant to the Underwriting Guidelines; and

         11. Such other documents or items as the Bank shall,  after the date of
this Loan  Agreement,  reasonably  require to be obtained  by the  Company  with
respect to Mortgage  Loans  identified in the Advance  Request and  constituting
Collateral hereunder.

         In the event the Bank does not approve the  Advance  Request,  the Bank
hereby  agrees to  promptly  return  to the  Company  any and all  documentation
delivered to the Bank in connection therewith.

                                       36
<PAGE>

                                    EXHIBIT D
                         GENERAL OPERATIONAL GUIDELINES

                  These General Operational Guidelines (the "Guidelines") are to
         describe the procedures  for making  advances,  and prepaying  advances
         made,  under that certain line of credit extended by Branch Banking and
         Trust Company ("Bank") to Community Resource Mortgage, Inc. ("Company")
         pursuant to the terms of that  certain  Warehouse  Credit and  Security
         Agreement dated as of October 5, 2004 ("Loan Agreement") to which these
         Guidelines are attached. All capitalized terms used in these guidelines
         not defined herein shall have the meanings assigned to them in the Loan
         Agreement.  These  Guidelines are intended to supplement the Procedures
         for  Requesting  Advances and Collateral  Documents (the  "Procedures")
         attached  as  Exhibit  C to the  Loan  Agreement  and are not  meant to
         release the Company from, or be a substitution for, any requirement set
         forth in the  Procedures.  The Company is expected to comply with these
         Guidelines and the  Procedures,  except in the event of a conflict,  in
         which  event  the  Loan  Agreement  or,  if not  addressed  in the Loan
         Agreement, the written instructions of the Bank, shall control.

         1.       Consumer  goes to the Company  and  applies for a  combination
                  construction  and permanent  mortgage  loan.  The Company goes
                  through  normal  qualification  procedures.  If  the  Loan  is
                  approved by the  Company,  the Company  will submit an Advance
                  Request  in the  form of  Exhibit  B and any  other  documents
                  required by the  Procedures  to the Bank. If the Bank approves
                  the Advance  Request and makes the  Advance,  the Company will
                  close the loan and use the Bank's  line of credit.  As long as
                  the Company  complies with the terms of the Loan Agreement and
                  the  Procedures,  the Bank will make  Advances with respect to
                  any Mortgage  Loan. Any Advance made by the Bank in connection
                  with an Advance  Request will be secured by the Mortgage Note,
                  the  Mortgage  and  the  other  Collateral  more  particularly
                  described  in the Loan  Agreement  (in each  case,  a "Pledged
                  Mortgage") delivered in connection with such Mortgage Loan.

         2.       As soon as the Mortgage Loan is  committed,  the Company faxes
                  to the Bank the information and documentation  outlined in the
                  Procedures for Requesting Advances.

         3.       As soon as possible after closing,  the closing  attorney will
                  send to the Bank via express mail the original  Mortgage  Note
                  for such Pledged  Mortgage.  The following items are verified:
                  (1) the name of the  borrower,  (2) the amount of the Mortgage
                  Loan,  (3) the original  signature of the borrower and (4) the
                  property  address.  The rest of the loan  package is sent from
                  the closing attorney to the Company.

         4.       Company will be  responsible  for  packaging the Mortgage Loan
                  for shipment to  Investor.  Several days before the package is

                                       37
<PAGE>

                  sent to Investor,  Company will contact Bank via fax/phone and
                  let Bank know which  original  Mortgage Note Company will need
                  and Bank will ship the  Mortgage  Note to Company via courier.
                  Company  will sign the Escrow  Delivery and Notice of Bailment
                  which will state that  Company  is holding  the  documents  on
                  Bank's behalf and these  documents will be surrendered to Bank
                  upon our request. Company will provide Bank with a copy of the
                  following with regard to each Mortgage Loan:

                  *Copy of the Mortgage
                  *Copy of the Title Binder
                  *Copy of the Application
                  *Copy of the Settlement Statement

                  Company will then ship the package to Investor  along with the
                  Escrow  Delivery and Notice of Bailment  which states that the
                  Investor is holding the  documents on the Bank's  behalf until
                  the Bank receives the wire for payoff.

         5.       Payoff: Within 18 days after receipt of the Mortgage Note from
                  the Bank, the Company's BB&T depository account should receive
                  a wire to pay-off the Mortgage  Loan.  The Company will notify
                  the Bank that this wire is expected via a fax with the name of
                  each borrower and the amount of such Mortgage  Loan.  The wire
                  may be a gross amount of several  Mortgage  Loans. If wire for
                  payoff is not  received by the Bank within 18 days of shipment
                  of Mortgage  Note to Company,  original  Mortgage Note will be
                  immediately returned to the Bank by hand delivery.

         6.       The Bank will  check  Company's  BB&T  depository  account  to
                  verify  the  receipt  of the  wire.  The Bank  will  debit the
                  principal   payment  due,  and  any  unpaid   interest  to  be
                  calculated  in  accordance  with  Section  2.4(a)  of the Loan
                  Agreement,  a $100 fee per Mortgage  Loan,  and any  overnight
                  delivery  expenses  actually  incurred  by Bank in sending the
                  Mortgage Note to the Company.

         7.       The Bank will send the Company the credit  advice and a detail
                  sheet  filled out on a weekly  basis  reflecting  the  payoffs
                  received,  principal  and fees debited and amounts  over/short
                  delineated  by the Mortgage  Loan for such  Pledged  Mortgage.
                  Interest  payments  will be  debited  as and when a  principal
                  payoff is received and shall reflect a total interest  payment
                  calculated  in  accordance  with  Section  2.4(a).  The credit
                  advice and detail sheet  delivered to the Company on the first
                  Business Day following the date on which interest payments are
                  debited  shall  reflect the amount of such  interest  payments
                  debited by the Bank.

These  Guidelines  are subject to  modification  by written notice from the Bank
followed by a comprehensive written copy of the revised Guidelines.

                                       38
<PAGE>

                                    EXHIBIT E
                        FORM OF COLLATERAL ASSIGNMENT OF
                               NOTES AND MORTGAGES

                                       39
<PAGE>

                                    EXHIBIT F
                       ADDITIONAL UNDERWRITING GUIDELINES

                  [to be agreed to by the Bank and the Company]

                                       40Exhibit 10.5

                                      BB&T

                               GUARANTY AGREEMENT

BRANCH BANKING AND TRUST COMPANY                                 October 5, 2004

Dear Sirs:

As an inducement to Branch  Banking and Trust Company  ("Bank") to extend credit
to and to otherwise deal with Community Resource Mortgage, Inc. ("Borrower") and
in consideration  thereof,  the undersigned (and each of the undersigned jointly
and severally if more than one) hereby absolutely and unconditionally guarantees
to Bank and its successors  and assigns the due and punctual  payment of any and
all notes,  drafts,  debts,  obligations and  liabilities,  primary or secondary
(whether by way of endorsement or otherwise),  of Borrower,  at any time, now or
hereafter,  incurred with or held by Bank,  together with interest,  as and when
the same  become due and  payable,  whether by  acceleration  or  otherwise,  in
accordance  with the terms of any such  notes,  drafts,  debts,  obligations  or
liabilities  or  agreements  evidencing  any such  indebtedness,  obligation  or
liability  including all renewals.  extensions and  modifications  thereof.  The
obligation of the undersigned is a guarantee of payment and not of collection.

         The undersigned is Bank's debtor for all indebtedness,  obligations and
liabilities  for which this  Guaranty is made,  and Bank shall also at all times
have the right of set-off against any deposit  account of the  undersigned  with
Bank in the same  manner and to the same  extent  that the right of set-off  may
exist against the Borrower.

         It is understood that any such notes,  drafts,  debts,  obligations and
liabilities may be accepted or created by or with Bank at any time and from time
to time without notice to the undersigned,  and the undersigned hereby expressly
waives presentment,  demand,  protest, and notice of dishonor of any such notes,
drafts,  debts,  obligations  and  liabilities  or other  evidences  of any such
indebtedness, obligation or liability.

         Bank may receive and accept from time to time any  securities  or other
property as a  collateral  to any such notes,  drafts,  debts,  obligations  and
liabilities, and may surrender,  compromise, exchange and release absolutely the
same or any part  thereof  at any time  without  notice to the  undersigned  and
without in any manner  affecting the obligation and liability of the undersigned
hereby  created.  The  undersigned  agrees that Bank shall have no obligation to
protect, perfect, secure or insure any security interests, liens or encumbrances
now or hereafter held for the  indebtedness,  obligations  and  liabilities  for
which this Guaranty is made.

         This obligation and liability on the part of the undersigned shall be a
primary, and not a secondary, obligation and liability, payable immediately upon
demand  without  recourse  first having been had by Bank against the Borrower or
any other guarantor, person, firm or corporation, and without first resorting to
any property held by Bank as collateral  security;  and the  undersigned  hereby
waives the benefits of all  provisions  of law for stay or delay of execution or
sale of property or other  satisfaction  of judgment  against the undersigned on
account of  obligation  and  liability  hereunder  until  judgment  be  obtained
therefor  against the Borrower and execution  thereon returned  unsatisfied,  or
until  it is  shown  that  the  Borrower  has  no  property  available  for  the
satisfaction of the indebtedness,  obligation or liability guaranteed hereby, or
until any other proceedings can be had; and the undersigned  further agrees that
the undersigned is responsible  for any obligation or debt, or portion  thereof,
of the  Borrower to the Bank which has been paid by the Borrower to the Bank and
which the Bank is  subsequently  required to return to the Borrower or a trustee
for the Borrower in any bankruptcy or insolvency proceeding; and the undersigned
further agrees that none of the undersigned shall have any right of subrogation,
reimbursement  or  indemnity  whatsoever,  nor any right of recourse to security
from the debts and  obligations  of the Borrower to Bank unless and until all of
the debts and  obligations  of the Borrower to Bank have been paid in full.  The
undersigned  hereby waives any claim or right to be a creditor of the Borrower's
bankruptcy  estate  which may  arise  upon  payment  by the  undersigned  of any
obligation under this Guaranty.

                                                                     Page 1 of 3

                                                             Initials:__________
<PAGE>

Check applicable box:

|_| This  Guaranty is  unlimited  and applies to all  indebtedness  of Borrower,
whether now existing or hereinafter arising.

|X| This  Guaranty  applies to all  indebtedness  of Borrower  evidenced  by its
promissory note dated October 5, 2004 (including all extensions,  renewals,  and
modifications thereof) in the principal amount of $20,000,000.00.

|_| This Guaranty is limited to an amount of $ plus accrued interest, late fees,
costs of collection  (including  attorneys' fees) and all other  obligations and
indebtedness  which may accrue or be  incurred  with  respect to the  Borrower's
indebtedness and obligations to Bank.

         To secure the payment of all obligations of the undersigned  hereunder,
the  undersigned  hereby  grants a security  interest and lien in the  following
goods    and    property    owned   by   the    following    undersigned:    N/A
                                                                         -------
--------------------------------------------------------------------------------
-----------------------------------------------------------------("Collateral").

The  undersigned  hereby  agrees to execute  and  deliver  to Bank any  security
agreement,  deed of trust, mortgage, UCC financing statement,  or other document
required  by the Bank in order to protect its  security  interest or lien in the
Collateral.  This  document  shall  constitute  a security  agreement  under the
Uniform  Commercial Code of South Carolina  ("Code"),  and in addition to having
all other legal rights and remedies, the Bank shall have all rights and remedies
of a secured party under the Code.

         This  agreement  shall inure to the benefit of Bank, its successors and
assigns, and the owners and holders of any of the indebtedness,  obligations and
liabilities hereby guaranteed,  and shall remain in force until a written notice
revoking it has been received by Bank; but such revocation shall not release the
undersigned  from liability to Bank,  its successors and assigns,  or the owners
and  holders of any of the  indebtedness,  obligations  and  liabilities  hereby
guaranteed, for any indebtedness,  obligation or liability of the Borrower which
is hereby  guaranteed and then in existence or from any renewals,  extensions or
modifications thereof in whole or in part, whether such renewals,  extensions or
modifications  are made before or after such revocation,  with or without notice
to the undersigned.  The undersigned  waives  presentment,  demand,  protest and
notices of every kind and assents to any one or more extensions,  modifications,
renewals  or  postponements  of the  time or  amount  of  payment  or any  other
indulgences  given to Borrower.  The  undersigned  shall be responsible  for and
shall  reimburse  the Bank for all costs and  expenses  incurred  by the Bank in
connection   with  the  enforcement  of  this  Guaranty  or  the  protection  or
preservation of any right or claim of the Bank in connection herewith, including
without  limitation  costs and expenses  incurred by the Bank in connection with
its  attempts  to  collect  the  indebtedness,   obligations,   and  liabilities
guaranteed hereby.  Cost and expenses shall include  reasonable  attorneys' fees
which the undersigned agrees shall be equal to 15% of the principal and interest
outstanding at the time of action by Lender described  above,  unless the actual
attorney'  fees  incurred,  based  upon  Bank's  counsel's  normal  hourly  fees
chargeable to Bank, shall be greater than 15% of principal and interest in which
case such billed  amount based on such hourly rate shall be the  attorneys'  fee
payable hereunder.

         If  the  Borrower  is  a  corporation,   this  instrument   covers  all
indebtedness,  obligations  and  liabilities  to Bank  purporting  to be made or
undertaken  on behalf of such  corporation  by any such officer or agent of said
corporation without regard to the actual authority of such officer or agent. The
term  "corporation"  shall include  associations  of all kinds and all purported
corporations, whether correctly and legally chartered and organized.

         This Guaranty is made in and shall be construed in accordance  with the
laws and judicial  decisions  of the State of South  Carolina.  The  undersigned
agrees that any dispute  arising out of this Guaranty  shall be  adjudicated  in
either the state or federal courts of South Carolina and in no other forum.  For
that purpose,  the undersigned  hereby submits to the  jurisdiction of the state
and/or federal courts of South Carolina. The undersigned waives any defense that
venue is not proper for any action  brought in any federal or state court in the
State of South Carolina.

<PAGE>

Waiver of Appraisal Rights.  The laws of South Carolina provide that in any real
estate  foreclosure  proceeding a defendant  against whom a personal judgment is
taken or asked may within thirty days after the sale of the  mortgaged  property
apply to the court for an order of appraisal.  The statutory  appraisal value as
approved by the court would be substituted for the high bid and may decrease the
amount  of any  deficiency  owing in  connection  with the  transaction.  TO THE
FULLEST EXTENT PERMITTED BY LAW AND AS A MATERIAL  INDUCEMENT FOR LENDER TO MAKE
THE LOAN,  GUARANTOR  HEREBY WAIVES AND  RELINQUISHES  THE  STATUTORY  APPRAISAL
RIGHTS WHICH MEANS THE HIGH BID AT THE JUDICIAL FORECLOSURE SALE WILL BE APPLIED
TO THE DEBT REGARDLESS OF ANY APPRAISED VALUE OF THE MORTGAGED PROPERTY.

Witness the signature and seal of each of the undersigned.

WITNESS                              Community Bankshares, Inc.

_________________________________    By:_______________________________   (SEAL)
                                                       William W. Traynham, Jr.
                                                       President

                                       Address of Guarantor(s):  P.O. Box 2086
                                       Orangeburg, South Carolina 29116

South Carolina: _____________ County

I, _______________, Notary Public of _________________ County, do hereby certify
that William W.  Traynham,  Jr., as President  of  Community  Bankshares,  Inc.,
personally appeared before me this day and acknowledged the due execution of the
foregoing instrument in writing.

Witness my hand and seal, this  _______ day of October, 2004.

My Commission Expires:                         ---------------------------------
                                               NOTARY PUBLIC

                                                                     Page 3 of 3

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