Document:

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                                                                   Exhibit 10.5

                               AMENDMENT NUMBER 3
                         TO MASTER REPURCHASE AGREEMENT
                                       and
                               AMENDMENT NUMBER 1
                         TO TRI-PARTY CUSTODY AGREEMENT

         This Amendment Number 3 to the Master Repurchase Agreement and
amendment Number 1 to the Tri-Party Custody Agreement (this "Amendment"), dated
as of February 11, 2000, is entered into among Metropolitan Mortgage &
Securities Co., Inc., Metwest Mortgage Services, Inc. (each, and jointly and
severally, "Seller"), Banc of America Mortgage Capital Corporation, successor by
merger to NationsBanc Mortgage Capital Corporation ("Buyer") and The Bank of New
York ("Custodian").

                                 R E C I T A L S

A.   Seller and Buyer entered into that certain Master Repurchase Agreement
     dated as of March 24, 1998 and amended such Master Repurchase Agreement as
     of October 8, 1998 and March 8, 1999 (as amended and as may be further
     supplemented, modified and amended from time to time, the "Repurchase
     Agreement").

B.   Seller, Buyer and Custodian entered into that Tri-Party Custody Agreement
     dated as of March 24, 1998 (as amended and as may be further supplemented,
     modified and amended from time to time, the "Custody Agreement").

C.   Buyer, Seller and Custodian each desire to modify the terms of the
     Repurchase Agreement and the Custody Agreement as set forth in this
     Amendment.

D.   Buyer, Seller and Custodian each have agreed to execute and deliver this
     Amendment on the terms and conditions set forth herein.

     NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and in the Repurchase Agreement and in the Custody Agreement,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree to the following:

1.   Miscellaneous. For all purposes of this Amendment, except as otherwise
     expressly provided or unless the context otherwise requires, (a) unless
     otherwise defined herein, all capitalized terms used herein shall have the
     meanings attributed to them by the Repurchase Agreement and the Custody
     Agreement, (b) the capitalized terms expressly defined in this Amendment
     have the meanings assigned to them in this Amendment and include (i) all
     genders and (ii) the plural as well as the singular, (c) all references to
     words such as "herein", "hereof" and the like shall refer to this Amendment
     as a whole and not to any particular article or section within this
     Amendment, (d) the term "include" and all variations thereon shall mean
     "include without limitation" and (e) the term "or" shall include "and/or".

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2.   Modifications and Amendments to Repurchase Agreement. A. Section 1 is
     hereby amended so that the first sentence is amended to read in its
     entirety as follows: "Buyer shall, from time to time, upon the terms and
     subject to the conditions set forth herein, agree to enter into
     transactions in which Seller transfers to Buyer Eligible Securities against
     the transfer of funds by Buyer, with a simultaneous agreement by Buyer to
     transfer to Seller such Purchased Securities at a date certain (not more
     than one year later), against the transfer of funds by Seller."

B.   Section 2 is hereby amended by adding the following definitions:

"Change in Law" means (a) the adoption of any law, rule or regulation after the
date of this Agreement, (b) any change in any law, rule or regulation or in the
interpretation or application thereof by any Governmental Authority after the
date of this Agreement or (c) compliance by Buyer (or any Affiliate of Buyer)
with any request, guideline or directive (whether or not having the force of
law) of any Governmental Authority made or issued after the date of this
Agreement.

"Commercial Property Loan" means a Loan secured by a first lien on a parcel of
real property improved by professional offices, retail and restaurant
facilities, mixed-use facilities or multifamily (more than four families)
residences ("Commercial Property") and has an original principal balance not
greater than $1,000,000.

"Eligible Security" means each Loan meeting the representations and warranties
set forth in Appendix A of the Custody Agreement and which the aggregate
outstanding Repurchase Price for such Loan, as of any date of determination,
together with the aggregate outstanding Repurchase Price for all other Loans
then subject to Transactions, shall not exceed an amount equal to (i) with
respect to the aggregate amount of Jumbo Loans, the greater of $5,000,000 or 5%
of the aggregate outstanding Purchase Price, (ii) with respect to the aggregate
amount of High LTV Loans, 3% of the aggregate outstanding Purchase Price, (iii)
with respect to the aggregate amount of Commercial Property Loans and REO
Facilitation Loans secured by Commercial Property, 15% of the aggregate
outstanding Purchase Price, (iv) with respect to the aggregate amount of REO
Facilitation Loans, 5% of the aggregate outstanding Purchase Price and (v) zero
percent (0%) of the aggregate outstanding Purchase Price with respect to the
aggregate amount of Loans as to which (A) any representation or warranty with
respect to such Loan has been breached, as determined by Buyer, (B) are more
than 30 days delinquent (as of the most recent month-end computer tape pursuant
to Section 13(g)) and the aggregate outstanding Purchase Price of such
delinquent Loans exceeds 10% of the aggregate outstanding Purchase Price, (C)
are Commercial Property Loans and are more than 30 days delinquent and the
aggregate outstanding Purchase Price of such delinquent Commercial Property
Loans exceeds 2.5% of the Maximum Aggregate Purchase Price or (D) are more than
60 days delinquent.

"High LTV Loan" means a Loan having a loan-to-value ratio between 95% and 100%.

"Jumbo Loan" means a Loan with an outstanding principal balance between $350,000
and $1,000,000 and, with respect to Loans having an outstanding principal
balance

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between $500,000 and $1,000,000, a Loan that conforms to the following
loan-to-value ratios:
         (i)      with respect to Loans having a credit score less than 550
                  pursuant to the Underwriting Guidelines, 70%;
         (ii)     with respect to Loans having a credit score of 550 or greater
                  but no more than 595 pursuant to the Underwriting Guidelines,
                  75%;
         (iii)    with respect to Loans having a credit score of 596 or greater
                  but no more than 650 pursuant to the Underwriting Guidelines,
                  80%; and
         (iv)     with respect to Loans having a credit score over 650 pursuant
                  to the Underwriting Guidelines, 85%.

"Material Adverse Change" means, with respect to a Person, any material adverse
change in the business, condition (financial or otherwise), operations,
performance, properties taken as a whole or prospects of such Person.

"Material Adverse Effect" means (a) a Material Adverse Change with respect to
Seller or Seller and its Affiliates that are party to any Program Document taken
as a whole; (b) a material impairment of the ability of Seller or any Affiliate
that is a party to any Program Document to perform under any Program Document
and to avoid any Event of Default; or (c) a material adverse effect upon the
legality, validity, binding effect or enforceability of any Program Document
against Seller or any Affiliate that is a party to any Program Document.

"Maximum Aggregate Purchase Price" means TWO HUNDRED MILLION DOLLARS
($200,000,000).

"REO Facilitation Loan" means a Loan with an original principal balance not
greater than $1,000,000.00, originated in connection with the sale of a one-to
four-family residential property or Commercial Property, and having a minimum
credit score of 550 and conforming to the following loan-to-value ratios: (i)
with respect to Loans graded A or A- pursuant to the Underwriting Guidelines,
100%; (ii) with respect to Loans graded B pursuant to the Underwriting
Guidelines, 95%; (iii) with respect to Loans graded C pursuant to the
Underwriting Guidelines, 90%; and (iv) with respect to Loans graded D pursuant
to the Underwriting Guidelines, 80%. C. Section 2 is hereby amended so that the
following definitions read in their entirety as follows:

"Market Value" means, (i) with respect to any Purchased Security that is an
Eligible Security, as of any date of determination, the market price as
determined by Buyer in good faith without credit for any interest accrued and
unpaid thereon and (ii) with respect to a Purchased Security that is not an
Eligible Security, zero. Buyer's determination of Market Value shall be
conclusive upon the parties, absent manifest error. In no event shall Market
Value exceed 102% of par for any Purchased Security.

"Metwest Subprime Program" shall mean Metwest Mortgage Services, Inc.'s
origination program for subprime mortgages.

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D.  Section 3(b) is hereby replaced in its entirety by the following:

b) Provided that the applicable conditions in Paragraphs 9(a) and 9(b) have been
satisfied, (i) each Purchased Security repurchased by Seller on the tenth day of
a month (or the following Business Day if such day is not a Business Day)
following the initial Purchase Date (each, a "Repurchase Date") shall
automatically become subject to a new Transaction unless Buyer is notified by
Seller at least two (2) Business Days prior to any Repurchase Date, and (ii) the
Buyer shall from time to time, but in no event more frequently than once per
month (unless otherwise agreed), enter into new Transactions with respect to
additional Loans and in each case the Repurchase Date therefor shall be the
tenth day of the month (or the following Business Day if such day is not a
Business Day) following such Purchase Date, provided that if the Repurchase Date
so determined is later than the three-year anniversary of the initial Purchase
Date (the "Termination Date"), the Repurchase Date for such transaction shall
automatically reset to such anniversary date, and the provisions of this
sentence as it might relate to a new Transaction shall expire on such date. For
each new Transaction, unless otherwise agreed, (i) the Purchase Price, the
percentage used in determining the Buyer's Margin Amount and the Pricing Rate
shall be set forth in the pricing letter from the Buyer to the Seller dated as
of even date with this Amendment and (ii) the accrued and unpaid Price
Differential shall be settled in cash on each related Repurchase Date.

E. Section 9(b)(v) is hereby replaced in its entire y by the following: (v) The
then aggregate outstanding Purchase Price, when added to the Purchase Price for
the requested Transaction, shall not exceed the Maximum Aggregate Purchase
Price. Seller agrees that the Market Value used in determining such portion of
the aggregate outstanding Purchase Price is at Buyer's sole discretion.

F. Section 9(b) is hereby amended by adding the following after subsection (v):
(vi) Buyer shall not have determined that the introduction of or a change in any
requirement of law or in the interpretation or administration of any requirement
of law applicable to Buyer has made it unlawful, and no Governmental Authority
shall have asserted that it is unlawful, for Buyer to enter into Transactions
with a Pricing Rate based on LIBOR.

G. Section 12 is hereby amended by adding the following after subsection (o):
(p) No Broker. Seller has not dealt with any broker, investment banker, agent,
or other person, except for Buyer, who may be entitled to any commission or
compensation in connection with the sale of Purchased Securities pursuant to
this Agreement; provided, that if Seller has dealt with any broker, investment
banker, agent, or other person, except for Buyer, who may be entitled to any
commission or compensation in connection with the sale of Purchased Securities
pursuant to this Agreement, such commission or compensation shall have been paid
in full by Seller. q) Corporate Separateness. Seller, on one hand, and
Custodian, on the other, maintain wholly separate businesses and principal
officers and have no interlocking officers or directors. r) Year 2000. Seller is
reviewing the areas within Seller's and Servicer's business and operations which
could be adversely affected by the risk that certain computer applications used
by Seller or Servicer may be unable to recognize and perform properly
date-sensitive functions involving dates prior to and after

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December 31, 1999 (the "Year 2000 Problem"). The Year 2000 Problem will not
result in (A) a Material Adverse Change with respect to Seller or Seller and its
Affiliates taken as a whole; or (B) a Material Adverse Effect.

H. Section 13(e) is hereby amended so that the first sentence reads in its
entirety as follows: "Seller shall do all things necessary to preserve the
Collateral so that it remains subject to a first priority perfected security
interest hereunder."

I. Section 13(g) is hereby replaced in its entirety by the following: (g)
Financial Statements: Accountants' Reports: Other Information. Seller shall keep
or cause to be kept in reasonable detail books and records of account of its
assets and business and shall clearly reflect therein the transfer of Purchased
Securities to Buyer. Seller shall furnish or cause to be furnished to Buyer the
following:
i) Financial Statements. (x) As soon as available and in any event within 105
days after the end of each fiscal year, the consolidated, audited balance
sheets of Seller as of the end of each fiscal year of Seller and the audited
financial statements of income and changes in equity of Seller, and the
audited statement of cash flows of Seller, for such fiscal year and (y) as
soon as available and in any event within 50 days after the end of each
quarter, the consolidated, unaudited balance sheets of Seller as of the end
of each quarter, and the unaudited financial statements of income and changes
in equity of Seller, and the unaudited statement of cash flows of Seller, for
the portion of the fiscal year then ended, and (z) within 30 days after the
end of each month, monthly consolidated and unaudited statements (excluding
cash flow statements) and balance sheets as provided in clause (y), all of
which have been prepared in accordance with GAAP. ii) Loan Performance Data.
Upon the request of Buyer, monthly reports in form and scope satisfactory to
Buyer, setting forth data regarding the performance of the Purchased
Securities for the immediately preceding month, and such other information as
Buyer may reasonably request. iii) Monthly Servicing Diskettes. Upon the
request of Buyer and on the fifth day of each month (or the following
Business Day if such day is not a Business Day), a computer tape (which tape
may be the Computer Tape referenced in Paragraph 4(a)) and a diskette (or any
other electronic transmission acceptable to Buyer) in a format acceptable to
Buyer containing such information with respect to the Purchased Securities as
Buyer may reasonably request. iv) Annual Budgets; Business Plans. Such annual
budgets, monthly and annual comparisons of conformity of operations with
annual budgets, annual projections of financial and operations results,
strategic business plans and other internal reports prepared or reviewed by
executive management as Buyer may reasonably request from time to time. v)
Quarterly Certification. Seller shall execute a quarterly certification
substantially in the form of Exhibit A attached hereto.

J. Section 13(h) is hereby replaced in its entirety by the following:
(h) Notice of Material Events. Seller shall promptly inform Buyer in writing of
any of the following: i) any Default, Event of Default or default or breach by
Seller of any obligation under any Program Document, or the occurrence or
existence of any event or circumstance that Seller reasonably expects will with
the passage of time become a Default, Event of Default or such a default or
breach by Seller; ii) any change in the fidelity or errors and omissions
insurance coverage required of Seller or any other

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Person pursuant to any Program Document, with copy of evidence of same attached;
iii) any material dispute, litigation, investigation, proceeding or suspension
between Seller, on the one hand, and any Governmental Authority or any other
Person; iv) any material change in accounting policies or financial reporting
practices of Seller; v) the occurrence of any material employment dispute which
would be likely to result in a Material Adverse Effect and a description of the
strategy for resolving it; and vi) any event, circumstance or condition that has
resulted, or is reasonably likely to result, in either a Material Adverse Change
with respect to Seller or a Material Adverse Effect.

K. Section 13 is hereby amended by adding the following after subsection (i): j)
No Withholdings for Taxes. Any payments made by Seller to Buyer shall be free
and clear of, and without deduction or withholding for, any taxes; provided,
however, that if Seller shall be required by law to deduct or withhold any taxes
from any sums payable to Buyer, then Seller shall (A) make such deductions or
withholdings and pay such amounts to the relevant authority in accordance with
applicable law, (B) pay to Buyer the sum that would have been payable had such
deduction or withholding not been made, and (C) at the time the Price
Differential is paid, pay to Buyer all additional amounts as specified by Buyer
to preserve the after-tax yield Buyer would have received if such tax had not
been imposed. k) Change in Nature of Business. Seller shall not make any
material change in the nature of its business as carried on at the date hereof.
l) Use of Custodian. Without the prior written consent of Buyer, which consent
shall not be unreasonably withheld, Seller shall use no third party custodian as
document custodian other than the Custodian with respect to lenders and
prospective third party lenders with respect to mortgage loans of the same type
as the Loans; provided, however, that the foregoing provision shall not apply to
Loans that have been sold into a securitization. m) Merger of Seller. Seller
shall not at any time, directly or indirectly, (i) liquidate or dissolve or
enter into any consolidation or merger; provided that Seller may enter into a
consolidation or merger so long as (1) Seller is the surviving entity after such
consolidation or merger, and (2) such consolidation or merger does not breach
the provisions of (iii) below; (ii) form or enter into any partnership, joint
venture, syndicate or other combination which would have a material adverse
effect on the business or financial condition of Seller and Seller's Material
Subsidiaries, taken as a whole; or (iii) make any material change in the nature
of the business of Seller or Seller's Subsidiaries. n) Insurance. Seller will,
and shall cause the Servicer to, obtain and maintain insurance with responsible
companies in such amounts and against such risks as are customarily carried by
business entities engaged in similar businesses similarly situated, and will
furnish Buyer on request full information as to all such insurance, and provide
within thirty (30) days after receipt of such request the certificates or other
documents evidencing the renewal of each such policy. o) Change of Fiscal Year.
Seller will not at any time, directly or indirectly, except upon ninety (90)
days' prior written notice to Buyer, change the date on which Seller's fiscal
year begins from Seller's current fiscal year beginning date. p) Year 2000.
Seller will ensure that the Year 2000 Problem (as defined in Section 12(r)) will
not result in (A) a Material Adverse Change with respect to Seller or Seller and
its Affiliates taken as a whole; or (B) a Material Adverse Effect.

L. Section 15 is hereby replaced in its entirety by the following:

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Upon discovery by Seller of a breach of any of the representations and
warranties set forth in Appendix A to the Custody Agreement, Seller shall give
prompt written notice thereof to Buyer. Upon any such discovery by Buyer, Buyer
will notify Seller. b) If Buyer determines that the introduction of, any change
in, or the interpretation or administration of any requirement of law has made
it unlawful or commercially impracticable to engage in any Transactions with a
Pricing Rate based on LIBOR, then Seller (i) shall, upon its receipt of notice
of such fact and demand from Buyer (with a copy of such notice to Custodian),
repurchase the Purchased Securities subject to the Transaction on the next
succeeding Business Day and, at Seller's election, concurrently enter into a new
Transaction with Buyer with a Pricing Rate based on the Prime Rate plus a margin
and (ii) may elect, by giving notice to Buyer and Custodian, that all new
Transactions shall have Pricing Rates based on the Prime Rate plus a margin. The
foregoing margins shall be solely determined and calculated by Buyer in good
faith; provided, however, that such margins shall not be greater than 100 basis
points (1%). c) If Buyer determines in its sole discretion that any Change in
Law regarding capital requirements has or would have the effect of reducing the
rate of return on Buyer's capital or on the capital of any Affiliate of Buyer as
a consequence of such Change in Law on this Agreement, then from time to time
Seller will compensate Buyer or Buyer's Affiliate, as applicable, for such
reduced rate of return suffered as a consequence of such Change in Law. Buyer
shall provide Seller with prompt notice as to any Change in Law. Notwithstanding
any other provisions in this Agreement, in the event of any such Change in Law
Seller will have the right to terminate all Transactions then outstanding as of
a date selected by Seller, which date shall be prior to the then applicable
Repurchase Date and which date shall thereafter for all purposes hereof be
deemed to be the Repurchase Date.

M. Section 17 is hereby replaced in its entirety by the following: "Buyer may,
in its sole election, engage in repurchase transactions with the Purchased
Securities or otherwise pledge, hypothecate, assign, transfer or otherwise
convey the Purchased Securities with a counterparty of Buyer's choice, in all
cases subject to Buyer's obligation to reconvey the Purchased Securities (and
not substitutes therefor) on the Repurchase Date. In the event Buyer engages in
a repurchase transaction with any of the Purchased Securities or otherwise
pledges or hypothecates any of the Purchased Securities, Buyer shall have the
right to assign to Buyer's counterparty any of the applicable representations or
warranties in Appendix A of the Custody Agreement and the remedies for breach
thereof, as they relate to the Purchased Securities that are subject to such
repurchase transaction."

N. Section 18(r) is hereby replaced in its entirety by the following:

r) The aggregate outstanding Purchase Price for all Purchased Securities then
subject to Transactions and greater than 30 days delinquent exceeds 10% of the
aggregate outstanding Purchase Price or the aggregate outstanding Purchase Price
for all Commercial Property Loans then subject to Transactions and greater than
30 days delinquent exceeds 2.5% of the Maximum Aggregate Purchase Price;
provided, however, that the Seller shall have 30 days to cure such Event of
Default; provided, further, that should the aggregate outstanding Purchase Price
for all Purchased Securities then subject

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to Transactions and greater than 30 days delinquent exceed 12% of the aggregate
outstanding Purchase Price, Seller shall have 15 days (in lieu of the aforesaid
30 days) to cure such Event of Default in like manner;{ or }

O. Section 18(s) is hereby replaced in its entirety by the following:

"Metropolitan Mortgage & Securities Co., Inc. shall fail to maintain (A) GAAP
net worth of at least $60,000,000, (B) a ratio of (i) the sum of Indebtedness
plus life insurance and annuity reserves to (ii) GAAP net worth of 21:1 or
less{,} OR (C) at least $50,000,000 of liquid assets (cash equivalents and
market value of U.S. Treasury securities and securities that are obligations of,
or fully guaranteed by, the Government National Mortgage Association, the
Federal National Mortgage Association {or}, the Federal Home Loan Mortgage
Corporation {) or (D) positive after-tax GAAP net income for two consecutive
quarters, commencing with the quarter ending March 31, 2000."}OR THE FEDERAL
HOME LOAN BANK); OR" P. SECTION 18 IS HEREBY AMENDED BY ADDING THE FOLLOWING
AFTER SUBSECTION (T) METROPOLITAN MORTGAGE & SECURITIES CO., INC. HAS NEGATIVE
AFTER-TAX GAAP NET INCOME FOR TWO CONSECUTIVE QUARTERS, COMMENCING WITH THE
QUARTER ENDING MARCH 31, 2000.

Q. Section 19 is hereby amended by adding the following to the end thereof:
Seller hereby authorizes Buyer, at Seller's expense, to file such financing
statement or statements relating to the Purchased Securities and the Collateral
without Seller's signature thereon as Buyer at its option may deem appropriate,
and appoints Buyer as Seller's attorney-in-fact to execute any such financing
statement or statements in Seller's name and to perform all other acts which
Buyer deems appropriate to perfect and continue the lien and security interest
granted hereby and to protect, preserve and realize upon the Purchased
Securities and the Collateral, including, but not limited to, the right to
endorse notes, complete blanks in documents and execute assignments on behalf of
Seller as its attorney-in-fact. This power of attorney is coupled with an
interest and is irrevocable without Buyer's consent.

R. Section 22 is hereby amended so that the fourth sentence reads in its |
entirety as follows: Seller agrees to, and shall, indemnify Buyer, Agent, their
respective Affiliates and their respective officers, directors, partners,
employees, representatives and agents (collectively, the "Indemnified Parties",
each an "Indemnified Party") from, and hold each of them harmless against, any
and all losses, liabilities, claims, damages, judgments, penalties, suits,
actions, costs, disbursements or expenses (including, but not limited to,
attorneys' fees, legal expenses and the allocated cost of internal counsel)
whether or not suit is brought and settlement costs imposed on, asserted against
or incurred by any of them as a result of, or arising out of, or in any way
related to, or by reason of, any investigation, litigation or other proceeding
(whether or not such Indemnified Party is a party thereto) relating to,
resulting from or arising out of (i) any of the Program Documents and all other
documents related thereto, (ii) any breach of a representation, warranty or
covenant of Seller or Seller's officer in this Agreement or any other Program
Document, (iii) the actual or

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alleged presence of hazardous materials on any Property or any environmental
action relating in any way to any Property and (iv) all actions taken pursuant
thereto (but excluding any such costs to the extent incurred by reason of gross
negligence or willful misconduct on the part of the Indemnified Party to be
indemnified).

S. Section 25 is hereby amended by adding the following after the last sentence:

If Buyer determines that, due to the introduction of, any change in, or the
compliance by Buyer with (i) any eurocurrency reserve requirement or (ii) the
interpretation of any law, regulation or any guideline or request from any
central bank or other Governmental Authority (whether or not having the force of
law), there shall be an increase in the cost to Buyer in engaging in the present
or any future Transactions, then Seller agrees to pay to Buyer, from time to
time, upon demand by Buyer (with a copy to Custodian) the actual cost of
additional amounts as specified by Buyer to compensate Buyer for such increased
costs. Notwithstanding any other provisions in this Agreement, in the event of
any such change in the eurocurrency reserve requirement or the interpretation of
any law, regulation or any guideline or request from any central bank or other
Governmental Authority, Seller will have the right to terminate all Transactions
then outstanding as of a date selected by Seller, which date shall be prior to
the applicable Repurchase Date and which date shall thereafter for all purposes
hereof, be deemed to be the Repurchase Date. In addition, Buyer shall promptly
notify Seller if any events in clause (i) or (ii) of this Section 25 occur.

T. Section 36 is hereby amended so that the second paragraph reads in its
entirety as follows:

"It is understood that Buyer's right to liquidate the Purchased Securities
delivered to it in connection with the Transactions hereunder or to exercise any
other remedies pursuant to Section 19 hereof is a contractual right to liquidate
such Transaction as described in Sections 555 and 559 of Title 11 of the USC."
U. Section 37 is hereby amended in its entirety to read as follows: Headings are
for convenience only and do not affect interpretation. The following rules of
this Section apply unless the context requires otherwise. The singular includes
the plural and conversely. A gender includes all genders. Where a word or phrase
is defined, its other grammatical forms have a corresponding meaning. A
reference to a subsection, Section, Annex or Exhibit is, unless otherwise
specified, a reference to a Section of, or annex or exhibit to, this Agreement.
A reference to a party to this Agreement or another agreement or document
includes the party's successors and permitted substitutes or assigns. A
reference to an agreement or document is to the agreement or document as
amended, modified, notated, supplemented or replaced, except to the extent
prohibited by any Program Document. A reference to legislation or to a provision
of legislation includes a modification

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or re-enactment of it, a legislative provision substituted for it and a
regulation or statutory instrument issued under it. A reference to writing
includes a facsimile transmission and any means of reproducing words in a
tangible and permanently visible form. A reference to conduct includes, without
limitation, an omission, statement or undertaking, whether or not in writing. An
Event of Default subsists until it has been waived in writing by Buyer. The
words "hereof", "herein", "hereunder" and similar words refer to this Agreement
as a whole and not to any particular provision of this Agreement. The term
"including" is not limiting and means "including without limitation." In the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including"; the words "to" and "until" each mean
"to but excluding", and the word "through" means "to and including." Unless the
context otherwise clearly requires, all accounting terms not expressly defined
herein shall be construed, and all financial computations required under this
Agreement shall be made, in accordance with GAAP, consistently applied.
References herein to "fiscal year" and "fiscal quarter" refer to such fiscal
periods of Seller. Except where otherwise provided in this Agreement any
determination, statement or certificate by Buyer or an authorized officer of
Buyer provided for in this Agreement is conclusive and binds the parties in the
absence of manifest error. Where Seller is required to provide any document to
Buyer under the terms of this Agreement, the relevant document shall be provided
in writing or printed form unless Buyer requests otherwise. At the request of
Buyer, the document shall be provided in computer disk form or both printed and
computer disk form. This Agreement is the result of negotiations among and has
been reviewed by counsel to Buyer and Seller, and is the product of both
parties. In the interpretation of this Agreement, no rule of construction shall
apply to disadvantage one party on the ground that such party proposed or was
involved in the preparation of any particular provision of this Agreement or
this Agreement itself. Any requirement of good faith or judgment by Buyer shall
not be construed to require Buyer to request or await receipt of information or
documentation not promptly available from or with respect to Seller, a servicer
of the Purchased Securities, any other Person or the Purchased Securities
themselves.

3. Modifications and Amendments to Custody Agreement.

A. Item (ii) of Part 1 of Appendix A to the Custody Agreement is hereby amended
in its entirety to read as follows:
(ii) All of the Mortgage Loans are secured by a first lien on a parcel of
real property improved by a one- to four-family residence, professional
offices, retail and restaurant facilities, mixed-use facilities or
multi-family (more than four families) residences;

B. Item (iii) of Part 1 of Appendix A to the Custody Agreement is hereby amended
in its entirety to read as follows:

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(iii) The maximum LTV for any Mortgage Loan is 100% or less;

C. Item (xiii) of Part 1 of Appendix A to the Custody Agreement is hereby
amended in its entirety to read as follows:

(xiii) Effective as of the Effective Date, each Mortgage Loan which is a loan to
facilitate the sale of real estate owned property, at the time of origination or
acquisition by Seller, as applicable, complied with the requirements set forth
in the definition of REO Facilitation Loan under Section 2 of the Repurchase
Agreement and, in all other material respects, with the Underwriting Guidelines;

D. Item (xviii) of Part 1 of Appendix A to the Custody Agreement is hereby
amended in its entirety to read as follows:

(xviii) Except with respect to any balloon loan, each Mortgage Loan is payable
in monthly installments of principal and interest which, in the case of a fixed
rate Mortgage Loan, are sufficient to fully amortize the original principal
balance over the original term thereof and to pay interest at the related
Mortgage interest rate, and, in the case of an adjustable rate Mortgage Loan,
are changed on each adjustment date, and in any case, are sufficient to fully
amortize the original principal balance over the original term thereof and to
pay interest at the related Mortgage interest rate. Except with respect to a
balloon loan, interest accrues on each Mortgage Loan on an actuarial basis, such
that each Monthly Payment contains a predetermined amount of principal and
interest unaffected by whether such Monthly Payment is made earlier or later
than its Due Date.
If the Mortgage Loan provides that the interest rate on the principal balance of
the related Mortgage Loan may be adjusted, all of the terms of the related
Mortgage pertaining to interest rate adjustments, payment adjustments and
adjustments of the outstanding principal balance have been made in accordance
with the terms of the related Mortgage Note and applicable law and are
enforceable and such adjustments will not affect the priority of the Mortgage
lien;

E. Item (xxxvi) of Part 1 of Appendix A to the Custody Agreement is hereby
amended in its entirety to read as follows:

(xxxvi) As of the initial Purchase Date, no Mortgage Loan was more than 30 days
delinquent; as of any date subsequent to the initial Purchase Date, no Mortgage
Loan is more than 60 days delinquent;

F. Item (xl) of Part 1 of Appendix A to the Custody Agreement is hereby amended
in its entirety to read as follows:

(xl) Each Mortgage Loan was acquired by the Seller in accordance with

<PAGE>

the Seller's Underwriting Guidelines;

G. Item (xlii) of Part 1 of Appendix A to the Custody Agreement is hereby
amended in its entirety to read as follows:

(xlii) No Mortgage Loan is secured by a time share, agricultural property,
co-operative unit, raw land, or a mobile home or a manufactured home not
permanently affixed to real property; and

4. No Other Changes. Except as expressly modified or amended in this
Amendment, all of the terms, covenants, provisions, agreements and conditions of
the Repurchase Agreement and the Custody Agreement are hereby ratified and
confirmed in every respect and shall remain unmodified and unchanged and shall
continue in full force and effect.

5. Counterparts. This Amendment may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed and delivered shall be deemed to be an original and all of
which taken together shall constitute one and the same instrument.

6. Governing Law; Waiver of Jury Trial. This Amendment shall be governed by,
and construed in accordance with, the laws of the State of New York, and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws without regard to conflicts of laws principles. The
parties hereto each hereby waive the right of trial by jury in any litigation
arising hereunder.

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute this Amendment Number 3 to Repurchase Agreement
and Amendment Number 1 to Custody Agreement as of the date first above written.

BANC OF AMERICA MORTGAGE CAPITAL
CORPORATION, as Buyer

By: /s/ Maureen Macan
Name: Maureen Macan
Title: Senior Vice President

METROPOLITAN MORTGAGE & SECURITIES
CO., INC., as Seller (jointly and severally)

By: /s/ C. Paul Sandifur, Jr.
Name: C. Paul Sandifur, Jr.
Title: President

METWEST MORTGAGE SERVICES, INC., as Seller
(jointly and severally)

By: /s/ C. Paul Sandifur, Jr.
Name: C. Paul Sandifur, Jr.
Title: President

THE BANK OF NEW YORK, as Custodian,
with respect to Section 3 of this Amendment only.

By: /s/ Robert P. Muller
Name: Robert P. Muller
Title: Assistant Vice President

<PAGE>

                                    EXHIBIT A
                             QUARTERLY CERTIFICATION

I, _________________________, ________________________ of Metropolitan Mortgage
& Securities Co., Inc. (the "Company"), a __________________________, do hereby
certify that:

(i) the Company is in compliance with all provisions and terms of the Master
Repurchase Agreement by and between Banc of America Mortgage Capital
Corporation, Metropolitan Mortgage & Securities Co., Inc. and Metwest Mortgage
Services, Inc. dated as of March 24, 1998 and amended as of October 8, 1998,
March 8, 1999 and February 11, 2000 (the "Repurchase Agreement");
(ii) the Company's net worth is not less than $60,000,000 pursuant to Section
18(s) of the Repurchase Agreement, as calculated in Exhibit 1 hereto;
(iii) the Company's ratio of the sum of (i) all Indebtedness plus life
insurance and annuity reserves to (ii) GAAP net worth does not exceed 21:1
pursuant to Section 18(s) of the Repurchase Agreement, as calculated in
Exhibit 1 hereto;
(iv) the Company holds at least $50,000,000 of liquid assets (cash
equivalents and market value of U.S. Treasury securities and securities that
are obligations of, or fully guaranteed by, the Government National Mortgage
Association, the Federal National Mortgage Association {or}, the Federal Home
Loan Mortgage Corporation {)} OR | THE FEDERAL HOME LOAN BANK), as calculated
in Exhibit 1 hereto; and |
(v) the Company has {maintained positive} NOT HAD NEGATIVE after-tax GAAP net
income |
for two consecutive quarters, including the quarter ended as of _____________,
200__, as calculated in Exhibit 1 hereto.
IN WITNESS WHEREOF, I have signed this certificate and affixed the seal of the
Company
Date: ________, 200_

______________________________

Name:
Title:
[SEAL]

I, ______________________, _______________________of the Company do hereby
certify that ________________________ is the duly elected or appointed,
qualified and acting ____________________ of the Company, and the signature set
forth above is the genuine signature of such officer in the date hereof.

______________________________
Name:
Title:

<PAGE>

                      Exhibit 1 to Quarterly Certification

METROPOLITAN MORTGAGE & SECURITIES CO., INC.
FINANCIAL COVENANT CALCULATIONS

As of Period Ended: [Date]
Repurchase
Agreement Section Covenant Required Amount Actual Amount
18(s)(A) Minimum GAAP net worth $60,000,000 $______________
18(s)(B) Indebtedness plus insurance
reserves to GAAP net worth 21.00:1.00 ______________
18(s)(C) Minimum liquid assets $50,000,000 $______________
Repurchase Agreement Section Covenant After-Tax GAAP Net Income
18(s)(D) $______________ $______________
Maintenance} 18(T)
AVOIDANCE of {positive}
NEGATIVE after-tax GAAP net
income for two consecutive
quarters for quarter ending for quarter ending
__________, 200_ __________, 200_
Calculation of Section 18(s)(B):
Indebtedness $________________
Life insurance and annuity reserves $________________
Total: $
GAAP net worth $________________
Leverage Ratio:<PAGE>

                                                                    Exhibit 10.6

                               AMENDMENT NUMBER 5
                         TO MASTER REPURCHASE AGREEMENT

         This Amendment Number 5 to the Master Repurchase Agreement (this
"Amendment"), dated as of September 27, 2000, is entered into among Metropolitan
Mortgage & Securities Co., Inc., Metwest Mortgage Services, Inc. (each, and
jointly and severally, "Seller") and Banc of America Mortgage Capital
Corporation, successor by merger to NationsBanc Mortgage Capital Corporation
("Buyer").

                                 R E C I T A L S

         A. Seller and Buyer entered into that certain Master Repurchase
Agreement dated as of March 24, 1998 and amended such Master Repurchase
Agreement as of March 24, 1998, October 8, 1998, March 8, 1999 and February 11,
2000 (as amended and as may be further supplemented, modified and amended from
time to time, the "Repurchase Agreement").

         B. Buyer and Seller each desire to modify the terms of the Repurchase
Agreement as set forth in this Amendment.

         C. Buyer and Seller each have agreed to execute and deliver this
Amendment on the terms and conditions set forth herein.

            NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein and in the Repurchase Agreement, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree to the
following:

            1  MISCELLANEOUS. For all purposes of this Amendment, except as
otherwise expressly provided or unless the context otherwise requires, (a)
unless otherwise defined herein, all capitalized terms used herein shall have
the meanings attributed to them in the Repurchase Agreement, (b) the capitalized
terms expressly defined in this Amendment have the meanings assigned to them in
this Amendment and include (i) all genders and (ii) the plural as well as the
singular, (c) all references to words such as "herein", "hereof" and the like
shall refer to this Amendment as a whole and not to any particular article or
section within this Amendment, (d) the term "include" and all variations thereon
shall mean "include without limitation" and (e) the term "or" shall include
"and/or".

            2  MODIFICATIONS AND AMENDMENTS TO THE REPURCHASE AGREEMENT.

            1. Section 2 of the Repurchase Agreement is hereby amended by
               deleting the definition of Maximum Aggregate Purchase Price and
               replacing it with the following:

               "Maximum Aggregate Purchase Price" means FIFTY MILLION
               DOLLARS ($50,000,000).

                                       1
<PAGE>

            2. Section 3(b) of the Repurchase Agreement is hereby deleted in its
               entirety and replaced by the following:

               Provided that the applicable conditions in Paragraphs 9(a) and
               9(b) have been satisfied, (i) each Purchased Security repurchased
               by Seller on the tenth day of a month (or the following Business
               Day if such day is not a Business Day) following the initial
               Purchase Date (each, a "Repurchase Date") shall automatically
               become subject to a new Transaction unless Buyer is notified by
               Seller at least two (2) Business Days prior to any Repurchase
               Date, and (ii) the Buyer shall from time to time, but in no event
               more frequently than once per month (unless otherwise agreed),
               enter into new Transactions with respect to additional Loans and
               in each case the Repurchase Date therefor shall be the tenth day
               of the month (or the following Business Day if such day is not a
               Business Day) following such Purchase Date, provided that if the
               Repurchase Date so determined is later than November 2, 2000 (the
               "Termination Date"), the Repurchase Date for such transaction
               shall automatically reset to the Termination Date, and the
               provisions of this sentence as it might relate to a new
               Transaction shall expire on such date. For each new Transaction,
               unless otherwise agreed, (i) the Purchase Price shall be equal to
               90% (the "Purchase Price Percentage") of the related Market
               Value, (ii) the percentage used in determining the Buyer's Margin
               Amount shall be the percentage equivalent of the fraction
               1/Purchase Price Percentage, (iii) the Pricing Rate shall be
               equal to Adjusted LIBOR plus two hundred basis points (2.00%) and
               (iv) the accrued and unpaid Price Differential shall be settled
               in cash on each related Repurchase Date.

            3. Section 23 of the Repurchase Agreement is hereby deleted in its
               entirety and replaced by the following:

               23.      [RESERVED].

            4. The following Section 39 is hereby added to the Repurchase
               Agreement:

               39.      RECOURSE OBLIGATION.

                        Notwithstanding any provision of this Agreement to the
               contrary, the liabilities and obligations of Seller under this
               Agreement are recourse obligations to Seller, and Buyer shall be
               able to enforce the liability and obligation of Seller to perform
               and observe such obligations by any action or proceeding against
               Seller.

            3  NO OTHER CHANGES. Except as expressly modified or amended in this
Amendment, all of the terms, covenants, provisions, agreements and conditions of
the Repurchase Agreement are hereby ratified and confirmed in every respect and
shall remain unmodified and unchanged and shall continue in full force and
effect.

                                       2
<PAGE>

            4  DELAY OF REMEDIES. Seller has informed Buyer that the financial
requirements set forth in subsection 18(s) of the Repurchase Agreement are not
met, thereby constituting an Event of Default under Section 18 (the "Default").
Buyer hereby acknowledges such shortfall and agrees that, without prejudicing
any rights or remedies that Buyer may have under the Repurchase Agreement
(including any rights with respect to any other Event of Default under the
Repurchase Agreement), Buyer will not exercise any of its rights under the
Repurchase Agreement with respect to the Default prior to October 31, 2000;
provided however, that the foregoing provision shall not be deemed to waive any
rights or remedies available to Buyer under the Repurchase Agreement or
applicable law, any and all such rights being expressly reserved.

            5. COUNTERPARTS. This Amendment may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed and delivered shall be deemed to be an original and all of
which taken together shall constitute one and the same instrument.

           23. GOVERNING LAW; WAIVER OF JURY TRIAL. This Amendment shall be
governed by, and construed in accordance with, the laws of the State of New
York, and the obligations, rights and remedies of the parties hereunder shall be
determined in accordance with such laws without regard to conflicts of laws
principles. The parties hereto each hereby waive the right of trial by jury in
any litigation arising hereunder.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       3
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute this Amendment Number 5 to Repurchase Agreement
as of the date first above written.

                                        BANC OF AMERICA MORTGAGE CAPITAL
                                        CORPORATION, as Buyer

                                        By:   __________________________________
                                        Name: __________________________________
                                        Title:__________________________________

                                        METROPOLITAN MORTGAGE & SECURITIES CO.,
                                        INC., as Seller (jointly and severally)

                                        By:   __________________________________
                                        Name: __________________________________
                                        Title:__________________________________

                                        METWEST MORTGAGE SERVICES, INC., as
                                        Seller (jointly and severally)

                                        By:   __________________________________
                                        Name: __________________________________
                                        Title:__________________________________

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