Document:

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                                                                    EXHIBIT 10.1

                       MORGAN STANLEY MORTGAGE CAPITAL INC.

                            MORTGAGE LOAN APPLICATION

                                                                    June 3, 2004

Vestin Fund III
c/o Bruce R. Francis
LJ Melody & Company
2415 East Camelback Road, Suite 410
Phoenix, AZ 85016

                        Re:  Property: Vestin Building
                             Address: Las Vegas, NV
                             MSMCI Loan No.: 04-17260

Ladies and Gentlemen:

         The undersigned ("Applicant" or "Controlling Entity") does hereby apply
to you, Morgan Stanley Mortgage Capital Inc., New York corporation ("Lender" or
"MSMCI"), to make a first mortgage loan (the "Loan") to be secured by the
property described in Exhibit A (the "Property") on the terms and conditions set
forth herein, in Exhibits A and B attached hereto and made a part hereof and in
the Final Approval Letter, if issued., subject to completion of MSMCI's
underwriting of the Loan and MSMCI's final credit committee approval of all
terms and conditions contained herein, including the Loan Amount (this
"Application"). Applicant understands that MSMCI agrees to make, or cause to be
made, the Loan to an entity primarily affiliated with the Controlling Entity
(the "Borrower") provided that the following items are satisfied: (i) MSMCI
receives and approves, as hereinafter set forth, the items in clauses (a)
through (t) below, (ii) MSMCI receives a duly executed copy of this Application,
and (iii) MSMCI receives the Good Faith Deposit, or the required portion thereof
as described herein within five (5) business days from the date hereof.

         Applicant agrees that MSMCI's agreement to fund the Loan is contingent
upon its receipt and approval of (a) an MAI appraisal prepared by an independent
appraiser acceptable to MSMCI in accordance with FIRREA standards (the
"Appraisal"), (b) capital expenditure budget(s), (c) engineering report(s), (d)
environmental report(s), (e) legal opinion(s) regarding the Borrower's ownership
structure, the enforceability of the Loan documents and such other matters as
Lender's counsel may require, (f) title insurance, (g) survey(s), (h) certified
current and historical rent rolls and property operating statements, (i)
management agreement(s), (j) organizational documents, (k) financial statements,
credit reports and UCC, litigation, bankruptcy and judgment searches for the
Borrower, the Controlling Entity, all entities comprising the Borrower and Key
Principals (as defined in Exhibit A), (l) copies of the standard form of lease,
(m) copies of all commercial space leases, historical tenant sales data, tenant
estoppels and subordination, non-disturbance and attornment agreements, (n)
current and prior years' real estate tax statements, (o) evidence of casualty,
liability and other insurance, (p)

                                                                /s/ MS

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evidence of establishment of operations and maintenance plans for possible
asbestos-containing materials, lead-based paint or radon, if applicable, (q)
evidence of compliance with all applicable laws and ordinances, (r) a site
inspection of the Property by MSMCI or its designee, (s) evidence of an
acceptable Minimum DSCR (as defined in Exhibit A) for the Property at closing
together with (t) such other documentation as MSMCI may, in its sole and
absolute discretion, require. All of the aforementioned items must be
satisfactory to MSMCI and its counsel, in their sole discretion. Controlling
Entity further confirms for itself and on behalf of the Borrower that all
tenants listed on the Property rent roll are in physical occupancy at the time
of loan closing of their space and that no tenant has exercised any right to "go
dark" in their lease.

         Applicant agrees that MSMCI's agreement to fund the Loan is also
contingent upon the satisfaction of the following conditions: (i) there shall
have been no material adverse change between application and closing (A) in the
operation, performance or condition (financial, physical or otherwise) of the
Property, the Borrower, the Controlling Entity, any one or more of the persons
or entities comprising the Borrower, any Key Principal or any major tenant at
the Property, or (B) in secondary market conditions or in the general or
commercial real estate markets, each of (i)(A) and (i)(B) above to be determined
by Lender in its sole discretion, (ii) the Borrower shall have executed and
delivered all such documents, instruments and certificates as MSMCI and its
counsel may require, in their sole and absolute discretion, to evidence and
secure the Loan (the "Loan Documents"), (iii) the documents and agreements under
which the Borrower (and its constituent entities to the extent required by
Lender's counsel) is formed or organized must provide (A) that such entity is a
newly formed, bankruptcy-remote single purpose entity in accordance with the
requirements of the national credit rating agencies and (B) for certain other
restrictions on its procedures and activities that are satisfactory to MSMCI and
its counsel in their sole discretion, and (iv) any and all Additional Closing
Conditions outlined in Exhibits A and B.

         The parties agree that pursuant to Section 5-1401 of the New York
General Obligations Law, this Application, and the interpretation and
enforcement hereof, and all rights and duties of the parties hereunder, and all
matters and issues arising out of or relating in any way to this Application,
shall be governed exclusively by, and construed in accordance with, the law of
the State of New York, without regard to the conflict of laws provisions
thereof. Each party to this Application (a) shall commence and maintain any
action, suit, proceeding or litigation (each, an "Action") arising out of or
relating in any way to this Application exclusively in the courts of the State
of New York sitting in the County of New York or in any federal court sitting in
the County of New York, and in no other court or forum, and (b) hereby (i)
irrevocably submits to the exclusive personal jurisdiction of the courts of the
State of New York sitting in the County of New York pursuant to Section 5-1402
of the New York General Obligations Law and any federal court sitting in the
County of New York, and any appellate courts to which appeals may be taken
therefrom, for the purposes of any such Action against it, and (ii) waives any
and all rights under the law of the State of New York or of any other
jurisdiction to object to the exclusive jurisdiction of, or the commencement of
any such Action in, the courts of

/s/ MS
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the State of New York sitting in the County of New York or the federal courts
sitting in the County of New York. Each party to this Application hereby waives
and agrees not to assert, as a defense in or to any such Action, (A) that such
party is not subject to the exclusive jurisdiction submitted to above or that
such Action may not be brought or is not maintainable in the courts identified
above, or that this Application may not be enforced in or by such courts or that
such party is exempt or immune from execution, (B) that such Action is brought
in an inconvenient forum, or (C) that the venue of such Action is improper.

         Any party to this Application that shall be the prevailing party in any
Action arising out of or relating in any way to this Application shall be paid
its reasonable legal fees and disbursements incurred in connection with such
Action by any adverse party or parties therein. In the absence of agreement
between or among the parties, the court in which such Action shall have been
conducted shall determine (i) whether a given party is a "prevailing party" or
an "adverse party;" (ii) whether the Action is one "arising out of or relating
in any way to this Application;" (iii) whether any requested legal fees and
disbursements are "reasonable;" (iv) whether such fees and disbursements were
"incurred in connection with such Action" and (v) in the event of multiple
adverse parties, in what amounts any award of fees and disbursements shall be
allocated against them.

         Notwithstanding anything contained in this Application to the contrary,
under no circumstances shall Controlling Entity or Borrower be entitled to
specific performance of this Application or any term or condition hereof.
Controlling Entity specifically acknowledges for itself and on behalf of
Borrower that it has an adequate remedy at law in the event of any breach of
this Application by Lender.

         This Application and Lender's obligations hereunder are expressly
conditioned upon the satisfactory review and underwriting of Borrower and the
Property by Lender. Controlling Entity acknowledges and agrees that,
notwithstanding anything to the contrary contained herein, Lender has no
authority to make the Loan to Borrower unless and until written authorization to
make the Loan is given by Lender's internal credit committee (the
"Authorization"). Controlling Entity understands and agrees that Lender is not
obligated to make the Loan contemplated hereby unless and until Lender (a) has
received the Authorization for the Loan, (b) has approved this transaction by
issuance of a separate approval letter (the "Final Approval Letter"), and (c)
such Final Approval Letter is accepted by the Controlling Entity. The Final
Approval Letter shall ratify the conditions set forth in this Application as
well as add or change terms and conditions as required by Lender. Without
limitation of the foregoing, Controlling Entity acknowledges and agrees that
notwithstanding any assistance Lender or its advisors or correspondents may have
provided Controlling Entity and/or Borrower, this Application is not an offer, a
contract, a binder, a memorandum of contract, a commitment or a promise to make
a loan by Lender. The terms of this Application are not all-inclusive and
additions and changes may be made as Lender and its counsel deem necessary
prudent or desirable. Controlling Entity hereby further acknowledges and agrees
that Lender shall in

/s/ MS
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no event be liable for any damages, costs, fees, expenses, loss of profits or
liabilities whatsoever incurred by the Controlling Entity and/or Borrower
including, but not limited to, consequential damages, arising from Lender's
decision to not make the Loan, or failure to issue a Final Approval Letter or
from any delay in closing the Loan.

         This Application shall expire and be of no further force and effect on
the Outside Closing Date (as defined in Exhibit A), by which time the Loan must
be closed subject to all of the terms and conditions contained herein.
Notwithstanding anything to the contrary contained in this Application, the
parties hereto agree that under no circumstance shall Lender be liable hereunder
for any amount in excess of the amount of the Good Faith Deposit actually
received by Lender less Lender's costs and expenses in connection with the Loan
(whether or not funded) and the sole and exclusive remedy of the Controlling
Entity and Borrower against the Lender hereunder shall be a return of the amount
of the Good Faith Deposit actually received by Lender less Lender's costs and
expenses in connection with the Loan (whether or not funded).

         The provisions of this Application cannot be waived or modified unless
such waiver or modification is in writing and signed by both MSMCI and the
Controlling Entity. The Loan application and related materials submitted to
MSMCI shall survive the issuance of this Application.

         This Application may be executed in one or more counterparts each of
which shall constitute an original document and all of which together shall
constitute one document. Controlling Entity has executed this Application for
itself and on behalf of Borrower.

         This Application and the rights of Borrower and Controlling Entity
hereunder shall not be assignable by operation of law or otherwise, and any
purported assignment thereof shall be null and void. Lender may assign its
rights and obligations hereunder to any direct or indirect affiliate or any
accommodation originator acceptable to Lender.

         If the foregoing is in accordance with your understanding of our
agreement, please sign two counterparts, retain one for your records and return
one to the undersigned within five (5) business days from the date hereof.
Unless we receive an executed counterpart of this Application, together with the
Good Faith Deposit or such required portion thereof, within five (5) business
days from the date hereof, this Application shall expire and be of no further
force or effect. Your timely acceptance shall represent a binding agreement
between MSMCI and the Controlling Entity.

                         [NO FURTHER TEXT ON THIS PAGE]

/s/ MS
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                                               Very truly yours,

                                               <borrower signature below>

                                               By: /s/ MS
                                                   -----------------------------
                                               Name:
                                               Title:

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                                        5             Version Date: June 3, 2004

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EXHIBIT A

                                  The Property

Name:               Vestin Building

Address:            Las Vegas, NV

Type:               Office

Net RSF:            40,940

No. of Stories:     2

Leased Occupancy:   100%

Year Built:         2004

Land Area:          2.27 acres

Parking Spaces:     205

Structure:          Concrete tilt-up

Loan Amount:        The Loan Amount for the Property will be the least of:

                    (A)  $4,950,000 (the "Projected Loan Amount");

                    (B)  An amount such that the debt service coverage ratio at
                         funding is a minimum of l.50x ("Minimum DSCR";
                         calculated as the ratio of MSMCI's estimated net
                         underwritable cash flow. Debt service ratio shall be a
                         minimum of l.50x's, based on a 20,25, or 30-year
                         amortization.

                    (C)  An amount such that the debt service coverage ratio at
                         funding is a minimum of 1.20x (calculated as the ratio
                         of (a) Net Cash Flow over (b) the product of (i) such
                         amount and (ii) 10.09%;

                    (D)  An amount equal to sixty percent (60%) of the appraised
                         value of the Property pursuant to the Appraisal; and,

/s/ MS
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                    (E)  An amount equal to fifty percent (50%) of the purchase
                         price of the Property if the Loan is being made in
                         connection with an acquisition of the Property, or the
                         Property has been purchased within the last twelve
                         months.

Loan Constant:      The Loan Constant shall be equal to (i) the sum of twelve
                    (12) regularly scheduled monthly principal and interest
                    payments divided by (ii) the Loan Amount.

Loan Term:          Ten (10) years from the first day of the first calendar
                    month following the Closing Date or, if the Closing Date is
                    the first day of a calendar month, ten (10) years from such
                    day.

Interest Rate:      The greater of (i) 5.40% (the "Minimum Coupon") or (ii) the
                    sum of (A) the current on the run ten year U.S. Treasury
                    note as determined by Lender, (the "Base Treasury Yield")
                    and (B) 85 basis points (the "Interest Rate Spread").
                    Interest on the Loan will be payable monthly in arrears and
                    shall be computed on the basis of the actual number of days
                    elapsed in the period for which such interest is payable by
                    a daily rate based on a 360 day year. Both the Minimum
                    Coupon and the Interest Rate Spread shall be subject to
                    change at Lender's sole discretion based upon (a) changes in
                    U.S. Treasuries or increases in swap spreads and/or (b)
                    changes in CMBS secondary market conditions, until the
                    Closing Date (as defined below). Notwithstanding anything
                    contained herein to the contrary, provided the Rate Lock
                    Date or Early Treasury Lock Date has not occurred, in the
                    event (i) Lender exercises its rights hereunder to change
                    the Minimum Coupon and/or the Interest Rate Spread and (ii)
                    Borrower is not willing to accept the new Interest Rate
                    determined by Lender then, upon Borrower's written request,
                    Lender shall refund to Borrower the amount of the Good Faith
                    Deposit actually received by Lender, less Lender's costs and
                    expenses in connection with the loan (whether or not funded)
                    and Lender shall have no further obligations or liability
                    hereunder.

Regularly           Lender acknowledges that the loan will be of the fixed-rate
Scheduled P&I       variety. The regularly scheduled monthly principal and
Payment:            interest payment will be calculated by Lender based on a
                    constant stream of level monthly payments of principal and
                    interest which would be sufficient to fully amortize the
                    Loan over twenty-five (25).

/s/ MS
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Outside Closing     The earlier of (i) September 15, 2004 or (ii) twenty-four
Date:               (24) hours following the setting of the Interest Rate by
                    Lender (unless Lender sets the Interest Rate pursuant to a
                    separate Early Rate Lock Request (See Exhibit B) in which
                    event the Outside Closing Date shall be the earlier of (a)
                    the date set forth in clause (i) above or (b) the outside
                    closing date for the Loan set forth in such Early Rate Lock
                    Request); time is of the essence with respect to Controlling
                    Entity's and Borrowers's obligation to close the Loan on or
                    before such date. At the time of the outside closing date as
                    set forth in the Early Rate Lock Request, Borrower may
                    extend early rate lock and outside closing date for
                    additional 30 days for a 5 basis point increase in interest
                    rate spread.

Minimum Monthly     Replacement Reserve: None
Reserve Escrows:

                    Tenant Improvements/Leasing Commission Reserves: None

                    Real Estate Taxes and Insurance: None with the requirement
                    that borrower gives Lender notice that said expense have
                    been paid, as required by Lender.

Broker:             Neither Controlling Entity nor Borrower has employed a
                    broker other than Bruce Francis of LJ Melody ("Broker") to
                    assist Controlling Entity in obtaining the Loan. Controlling
                    Entity will pay all fees and expenses owing to any and all
                    brokers and will indemnify and hold Lender harmless from any
                    and all other brokerage claims related to the Loan
                    transaction. Controlling Entity, for itself and on behalf of
                    Borrower, acknowledges that Broker is not an agent of Lender
                    and has no power or authority to bind Lender and that
                    neither Borrower nor Controlling Entity shall be entitled to
                    rely on any assurances or waiver given, or statements made
                    or actions taken, by Broker which purport to bind Lender or
                    modify or otherwise affect this Application or the Loan
                    transaction, unless Lender has, in its sole discretion,
                    agreed in writing with the Borrower to such assurances,
                    waivers, statements, actions or modifications.

Key Principals:     TBD

Additional Closing  The following conditions must be met prior to the Loan
Conditions:         closing subject to Lender's satisfactory review and approval
                    in its sole discretion:

                           1.   If tenant does not extend lease for a 5-year
                                term, evidenced by six-month notice of intent to
                                renew as required in the initial lease term,
                                Lender will sweep all available cashflow after
                                debt service during the final six months into a
                                TI/LC reserve

/s/ MS
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                                account. Funds will be released upon full
                                repayment of all outstanding loan principal
                                balance.

                           2.   Prior to closing, Borrower will have a lease in
                                full force and affect for the property in a
                                final form acceptable to lender.

                           3.   Carveout guarantor acceptable to Lender in all
                                respects.

                           4.   Borrower can be 100% owned by Vestin Funds III,
                                subject to lender's approval which shall be
                                based on review of organizational documents.

                           5.   Lender will allow borrower to obtain preferred
                                equity secured by partnership interests only up
                                to 75% of appraised value.

                           6.   Loan documents will governed by the State of
                                Nevada.

                           7.   This loan is subject to Lender's review and
                                approval of Vestin III's financial information.

/s/ MS
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                                    EXHIBIT B

                                Summary of Terms

Borrower:         A newly formed, single purpose entity primarily affiliated
                  with the Controlling Entity (the "Borrower") acceptable to
                  Lender which complies with the requirements of the national
                  credit rating agencies as determined by Lender from time to
                  time.

Collateral:       First lien on the Borrower's fee interest in the land and
                  improvements located at the Property described in Exhibit A.
                  First security assignment of all leases, rents and contracts
                  affecting the Property. First lien on all personal property,
                  fixtures and equipment of the Borrower on or used in
                  connection with the Property.

Closing Date:     The Closing Date will be the date the Loan is actually funded,
                  which shall occur on or before the Outside Closing Date.

Rate Lock Date:   The Interest Rate will be set at Lender's sole discretion on
                  the day of or the business day immediately preceding the
                  Closing Date (the "Rate Lock Date") unless the Treasury Rate
                  shall be sooner locked pursuant to a separate early rate lock
                  request, on Lender's form (the "Early Rate Lock Request")
                  executed and submitted by Controlling Entity and confirmed by
                  Lender (the "Early Treasury Lock Date").

Prepayment:       The Borrower may not prepay the Loan other than pursuant to
                  the terms hereof. After the earlier of (i) four years
                  following the full funding of the Loan or (ii) two years after
                  the securitization of the Loan, the Borrower may defease the
                  Loan and have the lien on the Property released by purchasing
                  and delivering to Lender U.S. Treasury securities in an amount
                  sufficient to pay the remaining principal and interest due on
                  the Loan as scheduled. Notwithstanding the preceding sentence,
                  the Loan may be prepaid without premium during the last three
                  (3) month period immediately preceding the scheduled Loan
                  maturity.

Loan              It is understood that the mortgage loan documents, including,
Documentation:    but not limited to, the promissory note, mortgage, tenant
                  SNDAs and estoppels and related collateral documents required
                  by Lender (collectively, the "Loan Documents"), must be on
                  Lender's forms without substantial changes to enable the Loan
                  to be eligible for inclusion in a possible securitization
                  pool. The Loan must meet standards for the commercial mortgage
                  securitization market as determined by MSMCI from time to

/s/ MS
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                  time. Borrower and Controlling Entity must assure compliance
                  in this regard.

Recording Costs:  Borrower shall pay all recording costs, mortgage taxes,
                  transfer taxes, intangible taxes, documentary stamps, filing
                  fees and any other costs as may be necessary to effect the
                  recording of the mortgage instrument, filing and recording of
                  financing statements and recording of any other necessary
                  instruments.

Good Faith        A Good Faith deposit of $25,000 shall be due and payable
Deposit:          upon acceptance of this Application.

                  Good Faith Deposit (the "Due Diligence Fee") will be used by
                  the Lender to cover costs in connection with this proposed
                  financing including but not limited to the following:

                       1.  a site inspection;

                       2.  travel expenses;

                       3.  insurance review costs;

                       4.  an engineering inspection report;

                       5.  an MAI appraisal report;

                       6.  a Phase 1 environmental assessment;

                       7.  credit reports;

                       8.  processing costs in the amount of $5,000;

                       9.  other out-of-pocket costs; and

                       10. a deposit towards Lender's legal fees.

                  In the event the Due Diligence Fee is found to be insufficient
                  then Borrower and Controlling Entity will be responsible for
                  any additional amounts owed. It is understood by Lender,
                  Borrower and Controlling Entity that processing of the
                  Application cannot begin until receipt by Lender of: (i) the
                  executed Application and (ii) the Good Faith Deposit or such
                  required portion thereof. In the event (i) Lender does not
                  approve the proposed Loan or (ii) Lender approves the proposed
                  Loan on terms which materially deviate from the terms of this
                  Application and such materially different terms are not
                  acceptable to Borrower, then upon written request of Borrower
                  (i) the aforementioned reports shall be made available to
                  Borrower for its use in obtaining financing

/s/ MS
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                    from another source and (ii) that portion of the Good Faith
                    Deposit actually received by Lender, less Lender's costs and
                    expenses in connection with the Loan shall be returned to
                    Borrower. Provided however, in the event Lender does approve
                    the proposed Loan on terms which are acceptable to Borrower
                    then the Good Faith Deposit actually received by Lender
                    shall be non-refundable unless Borrower fully complies with
                    the terms of the proposed Loan and the Loan closes. At
                    closing, Lender shall refund to Borrower the amount of the
                    Good Faith Deposit actually received by Lender, less
                    Lender's costs and expenses in connection with the Loan.

Deferred            Prior to funding the Loan, Lender or its designee will
Maintenance         review engineering studies of the Property to determine the
Escrow:             amount, if any, of deferred maintenance which is required at
                    the Property. On the Closing Date, Borrower will deposit one
                    hundred twenty-five percent (125%). of such amount in escrow
                    on terms acceptable to Lender. Lender will reimburse
                    Borrower from the deferred maintenance reserve escrow in
                    accordance with the terms of the Loan Documents upon
                    completion of all repairs.

Ongoing Escrow:     Starting on the Closing Date, Borrower shall deposit with
                    Lender escrows to assure adequate accrual of funds to pay
                    real estate taxes, insurance, ongoing maintenance reserves,
                    and leasing commissions and tenant improvements, all in
                    amounts deemed adequate by Lender, but not less than such
                    minimum amounts as may be noted in Exhibit A. None.

Required            Borrower or Controlling Entity shall provide all items
Information:        outlined in (a) through (t) in the Application in form and
                    substance satisfactory to Lender not less than five business
                    days prior to the Rate Lock Date.

Attorneys' Fees:    Borrower, at its own expense, will retain legal counsel to
                    represent it at closing and deliver opinions required by the
                    Lender. Further, Borrower and/or Controlling Entity will pay
                    Lender's attorneys' fees and expenses; including all fees
                    and expenses of Lender's transaction counsel and local
                    counsel, if required, in connection with the Loan, its
                    processing and/or closing and/or in connection with any
                    Action in any way relating to this Application (subject
                    however, to the provisions of the 6th paragraph of this
                    Application), whether or not the Loan closes or this
                    Application expires, is withdrawn or is otherwise
                    terminated, and whether or not any fee deposited by
                    Controlling Entity for payment of such fees and expenses is
                    sufficient. Lender will engage its counsel upon (a) receipt
                    of the executed Application, (b) an additional legal

/s/ MS
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                    deposit from Borrower and/or Controlling Entity, if
                    requested by Lender (such additional deposit to be added to
                    the Good Faith Deposit or such portion thereof as delivered
                    by Borrower and/or Controlling Entity to Lender and subject
                    to all of the terms and conditions herein relating to the
                    Good Faith Deposit or such portion thereof), and (c)
                    Borrower and/or Controlling Entity's written request to
                    Lender to engage counsel, as set forth below.

                    By initializing below, Borrower and/or Controlling Entity
                    hereby requests that Lender immediately engage counsel and
                    acknowledges that Borrower and/or Controlling Entity will
                    pay Lender's attorney's fees and expenses; including all
                    fees and expenses of Lender's transaction counsel and local
                    counsel, if required, in connection with the Loan, its
                    processing and/or closing and/or in connection with any
                    Action in any way relating to this Application, whether or
                    not the Loan closes or this Application expires, is
                    withdrawn or is otherwise terminated, and whether or not any
                    fee deposited by Borrower and/or Controlling Entity for
                    payment of such fees and expenses is sufficient.
                    ( ______________ )

Title Insurance     Borrower shall purchase and deliver to Lender a preliminary
Policy and          title report and, at closing, a full-coverage mortgagee's
Financing           title insurance policy issued by one of the title companies
Statement           shown on Schedule A attached hereto together with such
Certificates:       endorsements as may be required by Lender. The form and
                    content of the title insurance policy shall be satisfactory
                    to Lender. In addition, UCC, litigation, bankruptcy, and
                    judgment searches presented at closing must show that there
                    are no potential liens, judgements, financing statements or
                    other security interests of record except those securing the
                    Loan. The Borrower shall pay the cost of such title
                    insurance and searches. Borrower agrees to engage the title
                    agent and company indicated on Schedule A to issue the full
                    coverage mortgagee title insurance policy. Borrower may also
                    utilize a local title agent to assist with this process.

Zoning Laws and     Borrower must deliver evidence, satisfactory to MSMCI and
Regulations:        its counsel in their sole discretion, that (i) the Property
                    is in compliance with all applicable zoning laws and
                    regulations, (ii) all required special use permits (or the
                    equivalent thereof in each applicable municipality) have
                    been obtained and do not contain any unacceptable conditions
                    or restrictions, (iii) any improvements on the Property can
                    be fully rebuilt upon a casualty to all or part of the
                    Property, (iv) copies of all certificates of occupancy, and
                    (v) any other evidence Lender may require in its sole
                    discretion.

/s/ MS
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Current As-built    Borrower shall deliver to Lender a current as-built
Survey:             ALTA/ACSM survey of the Property, certified within 90 days
                    of closing, with such detail as required by Lender. The
                    survey must be prepared by a state-licensed surveyor and be
                    acceptable to Lender in all respects. Borrower shall pay all
                    survey costs.

Expenses:           Borrower and/or Controlling Entity shall pay expenses of
                    closing the Loan including, but not limited to, Borrower's
                    legal fees, MSMCI's legal fees and expenses as described
                    above, costs of all third party studies (including
                    accounting, environmental, engineering and appraisal), title
                    insurance costs and all recording and filing fees and taxes
                    whether or not the Loan closes or this Commitment expires,
                    is withdrawn or is otherwise terminated, and whether or not
                    any fee deposited by Borrower and/or Controlling Entity for
                    payment of such fees and expenses is sufficient.

Additional          No additional financing of any type will be allowed on the
Financing:          Property, the Borrower or constituent interests in the
                    Borrower.

Recourse:           Lender's recourse for all defaults in the obligations under
                    the Loan Documents will be limited to the Property and the
                    income derived therefrom, except in certain circumstances
                    (e.g., fraud, environmental, misrepresentation) more
                    particularly set forth in the Loan Documents and subject to
                    the requirements of the section entitled "Indemnity and
                    Guaranty" below.

Reporting           During the Loan Term, Borrower and all indemnitors and
Requirements:       guarantors of the Loan shall keep adequate books and records
                    of account in accordance with GAAP and furnish to Lender the
                    following, all as more particularly set forth in the Loan
                    Documents:

                    (i)    On a quarterly basis, rent rolls and property
                           operating statements for the immediately preceding
                           month or such prior period as Lender shall require,
                           or if the Loan has been securitized or sold as a
                           whole loan by Lender, quarterly and annual rent rolls
                           and property operating statements;

                    (ii)   annual property operating statements and operating
                           budgets;

                    (iii)  quarterly and annual balance sheets and profit and
                           loss statements for the Borrower; and

                    (iv)   such other additional financial and management
                           information as Lender may require from time to time.

/s/ MS
---------------
INITIAL HERE

                                       14             Version Date: June 3, 2004
<PAGE>

Assumability:       The Loan shall be assumable three (3) times after the first
                    year of the Loan Term, on payment of three quarters of one
                    percent (0.75%) fee, plus costs, and subject to MSMCI's
                    approval of the transferee in accordance with the terms of
                    the Loan Documents.

Management          Lender approves _________ as property manager. The property
Agreement:          management agreement shall be subordinate to the mortgage
                    and shall be subject to Lender's approval and shall provide
                    that it may be terminated at Lender's option upon the
                    occurrence of any of the following: (a) an event of default
                    under the Loan; or (b) if the Debt Service Coverage Ratio
                    drops below 1.15x.

Indemnity and       The Loan Documents shall contain an environmental indemnity
Guaranty:           and a guaranty of recourse obligations from Borrower,
                    Controlling Entity, and Key Principals, each of which shall
                    be satisfactory in all respects to MSMCI.

/s/ MS
---------------
INITIAL HERE

                                       15             Version Date: June 3, 2004

<PAGE>

                                   SCHEDULE A
                          (TITLE AGENTS AND COMPANIES)

Please select one of the following:

    Royal Abstract
--  Attn:  Martin Kravet
    500 Fifth Avenue, Suite 1940
    New York, New York 10110
    T: (212)376-0900
    F: (212)376-0911
    Email: mkravet@royalabstract.com

    First American Title Insurance Company
--  Attn:  Steve Napolitano
    633 Third Avenue
    New York, New York 10017
    T: (212)850-0640
    F: (212)331-1579
    Email: snapolitano@firstamny.com

    Lawyers Title Insurance Corporation/Commonwealth Land Title Insurance
--  Company
    Attn:  Peter Doyle
    655 Third Avenue, 11th Floor
    New York, New York 10017
    T: (212)949-0100
    F: (212)986-3049
    Email: pdoyle@landam.com

X   Stewart Title Insurance Company/Fidelity Title
--  Insurance Company
    c/o Title Associates
    Attn:   Jack Foley
    825 Third Avenue, 12th Floor
    New York, New York 10022
    T: (212)758-0050
    F: (212)758-8223
    Email: jfoley@titleassociates.com

/s/ MS
-----------------
INITIAL HERE

                                                      Version Date: June 3, 2004

                                       16<PAGE>

                                                                    EXHIBIT 10.2

                              ASSIGNMENT AGREEMENT

     This ASSIGNMENT AGREEMENT (the "Agreement") is entered into as of January
23, 2004, by and among VESTIN MORTGAGE, INC., a Nevada corporation ("Vestin
Mortgage"), VESTIN FUND I, LLC, a Nevada limited liability company ("Vestin
Fund I") and VESTIN FUND II, LLC, a Nevada limited liability company ("Vestin
Fund II"), the principal place of business and post office address of which are
2901 El Camino Avenue, Suite 206, Las Vegas, Nevada 89102 (collectively
sometimes referred to herein as the "Assignors"), on the one hand, and OWENS
FINANCIAL GROUP, INC., a California corporation ("Owens Financial") and OWENS
MORTGAGE INVESTMENT FUND, a California limited partnership ("Owens Mortgage
Investment Fund") the principal place of business and post office address of
which are 2221 Olympic Boulevard, Walnut Creek, California 94595 (collectively
sometimes referred to herein as the "Assignees"), on the other hand, with
reference to the following:

                                    RECITALS

     A.   Vestin Fund I is a direct participation program registered with the
Securities and Exchange Commission ("SEC") that provides financing secured by
deeds of trust or mortgages on real property. Vestin Fund I owns loans in the
approximate principal amount of One Hundred Million Dollars ($100,000,000.00).

     B.   Vestin Fund II is an SEC-registered direct participation program that
provides financing secured by deeds of trust or mortgages on real property.
Vestin Fund II owns loans in the approximate principal amount of Four Hundred
Million Dollars ($400,000,000.00).

     C.   Vestin Mortgage is the manager of Vestin Fund I and Vestin Fund II.

     D.   Owens Mortgage Investment Fund is an SEC-registered public partnership
that provides financing and owns notes secured by deeds of trust and mortgages
on real property.

     E.   Owens Financial is the general partner of Owens Mortgage Investment
Fund.

     F.   Each of the Assignors desires to assign to the Assignees all of that
Assignor's rights and obligations with respect to those certain loans set forth
on Exhibit "A" hereto (the "Participation Pool") to the extent of the
Assignees' Participation Interest (as hereinafter defined), all upon the terms
and subject to the conditions set forth herein, and each of the Assignees
wishes to acquire and accept the assignment of such rights and to assume such
obligations from the Assignors on such terms and subject to such conditions.

                                   AGREEMENT

     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
contained herein and for other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties hereto agree as follows:

     1.   Definitions:   Each of the capitalized terms used in this Agreement
shall have the respective meaning accorded to it in this Section 1:

     "Agreement" shall mean this Assignment Agreement as amended, modified or
restated in accordance with the terms hereof.
<PAGE>
     "Assignees' Participation Interest" shall mean the Assignees' interest in
the Loans included in the Participation Pool and the corresponding Loan
Documents, expressed in terms of dollars or a percentage (as the case may be).

     "Assignors' Participation Interest" shall mean the Assignors' interest in
the Loans included in the Participation Pool and the corresponding Loan
Documents, expressed in terms of dollars or a percentage (as the case may be).

     "Assignment" shall mean the actual recorded assignment of a specific
Participation Interest in a Loan.

     "Bankruptcy Proceeding" shall mean, with respect to any person or entity
("Person"), a general assignment by such Person for the benefit of its
creditors, or the institution by or against such Person of any proceeding
seeking its relief as debtor, or seeking to adjudicate such Person as bankrupt
or insolvent, or seeking reorganization, arrangement, adjustment or composition
of such Person or its debts, under any law relating to bankruptcy, insolvency,
reorganization or relief of debtors, or seeking appointment of a receiver,
trustee, custodian or other similar official for such Person or for any
substantial part of its property.

     "Borrower" shall mean any person or entity that obligates itself or its
property as security for a Loan included in the Participation Pool.

     "Collateral" shall mean, as to all of the Loans in the Participation Pool,
all of the real and personal property security that is pledged as collateral
under the Loan Documents.

     "Default" shall mean any event or condition, the occurrence of which
would, with the lapse of time or the giving of notice, or both, constitute an
event of default pursuant to the Loan Documents relating to any Loan in the
Participation Pool.

     "Interest Rate" shall mean the rate of interest to be paid to the
Assignees with respect to the Loans in the Participation Pool. This rate shall
be a fixed rate for the portion of the term of each Loan while it has been
assigned to the Assignees and shall be set forth at the time of the Assignment
in a side letter between the Assignors and the Assignees.

     "Late Charges" shall mean the late charges and or default rate charged to
Borrowers in the event of late payments or a Default under the Loan Documents.

     "Loan Documents" shall mean all of the various notes, deeds of trusts,
guarantees, title polices, security agreements, loan agreements, assignment of
rents and profits and other documents and instruments evidencing a Loan
included in the Participation Pool.

     "Loan" shall mean the indebtedness of each of the Borrowers owed to any of
the Assignors.

     "Priority of Payment" shall mean the order in which payments are to be
made hereunder to the Assignors and to the Assignees.

     "Participation Pool" shall mean those Loans more fully identified and
described on Exhibit "A" attached hereto in which the Assignees shall acquire
an interest hereunder in a principal amount of up to Twenty-Million Dollars
($20,000,000.00).

                                       2
<PAGE>

         "Substitution of Security" shall mean the exchange of one Loan in the
Participation Pool for a different Loan having an equal principal amount.

         2.       ASSIGNMENT AND ASSUMPTION.

                  2.1      ASSIGNMENT. Subject to the terms and conditions of
this Agreement, as of the Effective Date each of the Assignors hereby jointly
and severally sells, transfers and assigns to the Assignees, without
representation or warranty (except as expressly provided in this Agreement),
and the Assignees hereby purchase, assume and undertake from the Assignors: (i)
that portion of the Assignors' rights and obligations under the Loan Documents
for all of the Loans in the Participation Pool, in the amount of the Assignees'
Participation Interest as more fully set forth on Exhibit "B" to this
Agreement; and (ii) all related rights, benefits, obligations, liabilities and
indemnities of the Assignors under the Loan Documents for all of the Loans in
the Participation Pool to the extent of the Assignees' Participation Interest
therein.

                  2.2      ASSUMPTION. As of the Effective Date, the Assignees
shall succeed to all of the rights and assume all of the obligations of the
Assignors under the Loan Documents for all of the Loans in the Participation
Pool, but only to the extent of the Assignees' Participation Interest. Each of
the Assignees agrees that it will perform, in accordance with the terms of the
Loan Documents for all of the Loans in the Participation Pool, all of the
obligations that are required to be performed by it as a lender thereunder. It
is the intent of the parties hereto that, as of the Effective Date, the
Assignors shall relinquish all of their rights and be released from all of
their obligations under the Loan Documents for all of the Loans in the
Participation Pool to the extent that such rights have been assigned to, and
such obligations have been assumed by, the Assignees pursuant to the terms
hereof.

                  2.3      PARTICIPATIONS INTERESTS. After giving effect to the
assignment and assumption set forth herein, on the Effective Date, the
respective Participation Interests of the Assignors and the Assignees in all of
the Loans in the Participation Pool shall be as set forth on Exhibit "B" hereto.

         3.       PAYMENT BY THE ASSIGNEES. At or before 3:00 p.m., Pacific
Time, on the Effective Date, the Assignees shall pay to Vestin Mortgage, for
the benefit of all Assignors, in immediately available funds, the following
amount, for the Assignees' Participation Interest in the Loans in the
Participation Pool, pursuant in the following payment instructions:

         Wire to:
         Vestin Fund II, LLC, Investment Account
         Account #153790381963
         at US Bank ABA #121201694

         4.       REALLOCATION OF PAYMENTS. Any interest, fees and other
payments payable to the Assignors with respect to the Loans in the
Participation Pool that have accrued up to the Effective Date with respect to
the Assignees' Participation Interest shall be for the account of the
respective Assignors. Any such interest, fees and other payments accrued on and
after the Effective Date with respect to the Assignees' Participation Interest
shall be for the account of the Assignees. Each of the Assignors and the
Assignees agrees that it will hold in trust for the other parties any interest,
fees and other amounts which it may receive to which the other parties is
entitled pursuant to the preceding sentence and pay to that other party any
such amounts which it may receive promptly upon receipt thereof; provided, that
all payments for the account of any Assignor shall be paid to Vestin Mortgage,
for the benefit of the respective Assignor, and all payments for the account of
either Assignee shall be paid to Owens Financial, for the benefit of the
respective Assignee.

                                       3
<PAGE>

     5. INDEPENDENT CREDIT DECISION: APPOINTMENT OF AGENT.

          5.1    INDEPENDENT CREDIT DECISION. Each of the Assignees: (i)
acknowledges that it has received a copy of each and every one of the Loan
Documents, as well as such other documents and information as it has deemed
appropriate in order to make its own credit and legal analysis and decision to
enter into this Agreement; and (ii) agrees that it will, independently and
without reliance upon the Assignors and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit and
legal analyses and decisions in taking or not taking action under the Loan
Documents.

          5.2    APPOINTMENT OF AGENT. Each of the Assignees hereby appoints and
authorizes Vestin Mortgage to act as the Assignee's agent on its behalf and to
exercise such powers under the terms of the Loan Documents as the respective
Assignor as lender is authorized to exercise by the terms thereof, together with
such other powers as are reasonably incidental thereto. Notwithstanding the
foregoing, Vestin Mortgage agrees that, so long as any portion of a Loan is
outstanding or unpaid, it shall, for the benefit of each of the Assignees:

                 (i)     notify Owens Financial, on behalf of the Assignees, by
telephone and in writing, before taking or filing any action, judicial or
otherwise, to enforce any rights or pursue any remedy under any of the Loan
Documents; and

                 (ii)    refrain from selling any Loan in the Participation
Pool, or accepting any substitute guaranty, substitute collateral, or any other
security for any Loan in the Participation Pool, without the consent of the
Assignees; provided, that in the event that the Assignees refuse to consent to
such requested action, Vestin Mortgage may either repurchase the Assignees'
Participation Interest relating to the Loan in question for the amount of
principal and accrued interest outstanding thereunder or provide the Assignees
a Substitution of Security acceptable to Assignees, in their sole discretion.

     6.  EFFECTIVE DATE. The effective date for this Agreement (the "Effective
Date") shall be the date set forth as such on Exhibit "B" hereto. On or before
the Effective Date, each and every one of the following conditions precedent
shall have been satisfied in full or shall have been waived by the party or
parties for whose benefit the condition was to be satisfied:

                 (i)     this Agreement shall have been executed by all of the
Assignors and the Assignees and delivered to each;

                 (ii)    the representations and warranties of each of the
Assignors and the Assignees contained in this Agreement shall be true and
correct on the Effective Date as if made thereon; and

                 (iii)   each of the Assignors and the Assignees shall have paid
all sums required to be paid by it, whether pursuant to Sections 3 and 4 hereof
or otherwise.

     7.  REPRESENTATIONS AND WARRANTIES.

          7.1     REPRESENTATIONS OF THE ASSIGNORS. Each of the Assignors
represents and warrants to the Assignees that: (i) it is the legal and
beneficial owner of the interests being assigned by it hereunder and that such
interests are free and clear of any adverse claim or lien other than those
which it has already disclosed to the Assignees in writing; (ii) it is duly
organized and validly existing under the laws of the jurisdiction in which it
was organized and is duly qualified to do business in each jurisdiction in
which it engages in business, and it has the full power and authority

                                       4

<PAGE>

to take, and has taken, all action necessary to execute and deliver this
Agreement and any other documents required or permitted to be executed or
delivered by it in connection with this Agreement and to fulfill its
obligations hereunder; (iii) no notices to, or consents, authorizations or
approvals of, any person are required (other than any already given or
obtained) for its due execution, delivery and performance of this Agreement
and, no further action taken by, notice to or filing with any person is
required of it for such execution, delivery or performance; (iv) this Agreement
has been duly executed and delivered by it and constitutes the legal, valid and
binding obligation of that Assignor, enforceable against that Assignor in
accordance with the terms hereof, subject (as to enforcement) to bankruptcy,
insolvency, moratorium, reorganization and other laws of general application
relating to or affecting creditors rights and to general equitable principles;
(v) there exists no Default under any of the Loan Documents; and (vi) it holds
all licenses that are required, and has complied with all laws and regulations
with which it must comply, in order for it lawfully to engage in the businesses
in which it is currently engaged.

                 7.2  Representations of the Assignees.  Each of the Assignees
represents and warrants to the Assignors that: (i) it is duly organized and
validly existing under the laws of the jurisdiction in which it was organized
and is duly qualified to do business in each jurisdiction in which it engages in
business, and it has full power and authority to take, and has taken, all
actions necessary to execute and deliver this Agreement and any other documents
required or permitted to be executed or delivered by it in connection with this
Agreement to fulfill its obligations hereunder; (ii) no notices to, or consents,
authorizations or approvals of, any person are required (other than any already
given or obtained) for its due execution, delivery and performance of this
Agreement and no further action by, notice to or filing with any person is
required of it for such execution, delivery or performance; and (iii) this
Agreement has been duly executed and delivered by it and constitutes the legal,
valid and binding obligation of that Assignee, enforceable against that Assignee
in accordance with the terms hereof, subject (as to enforcement) to bankruptcy,
insolvency, moratorium, reorganization and other laws of general application
relating to or affecting creditors' rights and to general equitable principles.

         8.      Additional Obligations of the Assignors.

                 8.1  Payment Obligations.  Each of the Assignors shall
promptly pay over to Owens Financial, for the benefit of the Assignees, all
amounts received by that Assignor in connection with the Assignees'
Participation Interest.

                 8.2  Accountings.  Each of the Assignors agrees to provide to
Owens Financial, for the benefit of the Assignees, upon reasonable request but
in no event more frequently than once a month, a statement of all payments
received in respect of the Loans in the Participation Pool.

                 8.2  Additional Information.  Each of the Assignors shall
promptly provide to Owens Financial, for the benefit of the Assignees, a copy
of all financial statements and reports of operating results and other
documents and information received by that Assignor in its capacity as a lender
pursuant to the Loan Documents. Each of the Assignors shall have a duty and
responsibility to provide Owens Financial, for the benefit of the Assignees,
with any credit or other information concerning the affairs, financial
condition or business of any of the Borrowers which may come into the
possession of that Assignor, including financial statements, credit reports and
any other documents and information.

                 8.4  Recourse Against the Assignors.  Each of the Assignees
shall have full recourse against any or all of the Assignors for the amounts
payable by the terms of this Agreement, whether as a result of an Assignor's
failure to comply with the terms of this Agreement, including the

                                       5
<PAGE>
Priority of Payment or otherwise. The joint and several obligations of each
Assignor with respect to such payments shall be to remit to Owens Financial,
for the benefit of the Assignees, a monthly payment based upon the Interest
Rate calculated on the Assignees' Participation Interest and the principal
amount of Assignees' Participation Interest when a Loan is paid off or matures,
all in accordance with the Agreement.

          8.5  Duty of Care. Each of the Assignors will exercise the same duty
of care in administering the Loans as if the Loans were made entirely for
that Assignor's own account; provided, however, that the Assignors' liability in
this regard shall be limited to the amount of Assignees' Participation Interest
and the amount payable thereon at the Interest Rate, except for a loss due to an
Assignor's gross negligence, willful acts or misconduct, in which case the
foregoing limitation of Assignors' liability shall not apply.

     9.  Limitation on Liability of the Assignors.

          9.1  Reliance. Each of the Assignors shall be entitled to rely upon
any certification, notice or other communication (including any thereof by
telephone, telex, telegram, cable or telecopy) reasonably believed by it to be
genuine and correct and to have been signed or sent by Owens Financial on
behalf of the Assignees. Should approval of any action, any inaction or any
proposed course of conduct in administering the Loans (either before or after
the occurrence of a Default) be requested in writing by Vestin Mortgage from
the Assignees, Owens Financial (on behalf of the Assignees) shall approve or
deny such request in writing and shall deliver the writing to Vestin Mortgage
within ten calendar days after receipt of the request. If Owens Financial fails
to respond to such request within the specified ten calendar day period, such
failure shall not be deemed to be a consent to such request.

          9.2  Further Limitation. Subject to the provisions of Section 8.4
hereof and any other provision of this Agreement to the contrary, none of the
Assignors shall have liability, either express or implied, for (i) the
collectibility of the Loans made to Borrowers under, or the enforceability of,
any of the Loan Documents; (ii) the financial condition or creditworthiness of
any of the Borrowers; (iii) any credit or other information furnished by the
Borrowers to any Assignor; or (iv) the value of any Collateral.

     10.  Administration of the Loans.

          10.1  Administration and Servicing. In administering and servicing the
Loans, Vestin Mortgage shall act on behalf of the Assignors as to the Assignors'
Participation Interest in the Loans and Owens Financial shall act as agent for
the Assignees with respect to the Assignees' Participation Interest in the
Loans. Vestin Mortgage agrees to utilize its own facilities and equipment and
its own employees and other persons authorized under the Loan Documents in the
administering and servicing of the Loans, all without cost to the Assignees.

          10.2  Duties of Vestin Mortgage. In its administering and servicing
of the Loans, Vestin Mortgage shall perform the following duties (the
enumeration of said duties not being intended to limit the duties to be
performed by Vestin Mortgage in accordance with the foregoing Section 10.1),
shall be subject to the following restrictions and shall have the following
rights:

               a.  Vestin Mortgage shall hold, for the benefit of the
Assignees, in its possession at its principal office, executed originals of all
of the Loan Documents for each Loan in the Participation Pool, and shall
deliver conformed copies of each thereof to Owens Financial for the benefit of
the Assignees.

                                       6
<PAGE>

         b.       In the event that any legal expenses or other expenses for
the preservation of the Collateral or for the enforcement of the Loans are
incurred by an Assignor in connection with the Loans on or after or in
connection with the occurrence of a Default or the enforcement of any the Loan
Documents (including fees of counsel and other expenses), the Assignors alone
shall bear and advance all such costs. Upon receipt of reimbursement for such
expenses from a Borrower or any other person, the Assignors alone shall be
entitled to retain such reimbursement. Neither of the Assignees shall be
obligated to reimburse any Assignor for any such costs.

         c.       Each of the Assignors shall use reasonable efforts to
collect all payments of principal, interest and fees due from the Borrowers
under the Loan Documents and shall remit to Owens Financial, for the benefit of
the Assignees, on or before the 7th but not later than the 11th of each and
every month, a payment calculated at the Interest Rate based on the
outstanding balance of the Assignees' Participation Interest. Assignor shall pay
to Assignee a late charge of ten percent (10.00%) per annum of the payment, or
any portion thereof, not received by Assignee by the 11th of the month. Vestin
Mortgage shall concurrently provide Owens Financial, for the benefit of the
Assignees, with an accounting of all monies received in connection with each
Loan as to which the Assignees hold a Participation Interest.

         d.       If any payment received by an Assignor and distributed or
credited to an Assignee is later rescinded or is otherwise required to be
returned by that Assignor to a Borrower for whatever reason (including, without
limitation, settlement of an alleged claim), the Assignee shall be entitled to
retain such payment so received. The covenant contained in this paragraph shall
survive the termination of this Agreement.

         e.       Each of the Assignors shall maintain such books and records
relating to the Loans as it would were the Loans made solely by that Assignor,
which books and records shall be made available to Owens Financial, for the
benefit of the Assignees, at the Assignor's main branch in Las Vegas, Nevada at
all reasonable times for purposes of inspection, examination and audit upon no
less than forty-eight (48) hours prior notice.

         f.       During the term of this Agreement, each of the Assignors
shall provide to Owens Financial, for the benefit of the Assignees, complete
and current information as to the accrual status of the Loans and the status of
principal and interest payments, and all information supplied by Borrowers in
connection with the Loans. Each of the Assignees will treat all such
information as confidential, except that disclosure thereof may be made if
required by law or the order of a court having jurisdiction.

         g.       No Assignor shall, without written consent of the Assignees:
(i) release, or agree to the substitution of other collateral or security for,
any portion of the Collateral; (ii) grant any release in favor of the Borrowers
under the Loan Documents, or waive its rights to enforce the obligations of
the Borrowers; (iii) agree to the revision, modification or amendment of any of
the Loan Documents; or (iv) consent to or accept the cancellation or
termination of any of the Loan Documents, except upon payment in full of each
Loan. Subject to the foregoing limitations and until the occurrence and
declaration of a Default under the Loan Documents and Borrowers' failure to
promptly cure same, Vestin Mortgage shall have the right to make decisions in
connection with the day-to-day administration and servicing of the Loans
relating to inspections, review of financial data and other matters of an
ordinary nature involved in the administration and servicing of the Loans
without the Assignees' prior review or approval.

                                       7
<PAGE>
                  h.       If any Default shall occur under any of the Loans,
the Assignors shall use reasonable efforts in accordance with the Loan
Documents to cause the Borrowers, any guarantors and/or any limited guarantors
to remedy the Default.

                  i.       If any Assignor becomes aware of any damage to or
actual or potential condemnation affecting any material portion of the
Collateral, that Assignor will promptly notify Owens Financial, on behalf of
the Assignees. The proceeds of any insurance recovery or condemnation award
received by any Assignor and not immediately disbursed or applied to the
repayment of the Loan or not otherwise distributed by that Assignor shall be
deposited in an interest-bearing account, in trust for the Assignors and the
Assignees, and the income, if any, received by that Assignor from such account
and not payable to others shall be shared with the Assignees in accordance with
the terms of this Agreement and the interests of the parties.

         11.      Payment Priorities between the Assignors and the Assignees.
Each of the Assignors and the Assignees agrees that all payments and/or
prepayments of principal due on the Loans, received by any Assignor, shall be
held for the account of the Assignees and the Assignors as their respective
interests may appear, and such payments shall be applied in the following order
of priority: (i) first, to the payment of that portion of principal of the Loans
provided by the Assignees; (ii) second, to the payment of any accrued or
outstanding interest due either Assignee at the Interest Rate; and (iii) third,
to the payment of that portion of the principal of the Loans provided by the
Assignors. In the event of a Default under the Loan Documents, each of the
Assignors agrees to substitute an alternative Loan acceptable to the Assignees
in the Assignees' sole discretion. In the event that no acceptable alternative
Loan offered by Assignors is acceptable to Assignees, the Assignors will
purchase the Assignees' Participation Interest for the outstanding principal
balance of that Participation Interest plus any accrued interest within ten (10)
calendar days of Assignees' request. In the event of such Default under the Loan
Documents, no Assignor shall be entitled to receive any payment of its pro rata
share of the principal of the Loans in question until the Assignees have
received payment in full of their Participation Interest in the principal of the
Loans and all accrued interest, late charges, default interest and any other
charges payable to the Assignees under this Agreement.

         12.      Defaults Under Loan Documents:

                  12.1     Information. If foreclosure or similar proceedings
are commenced under the Loan Documents, the Assignors shall keep the Assignees
informed as to the progress of the proceedings.

                  12.2     Buy-Out Rights. If any Assignor (or a nominee
acceptable to the Assignees) shall acquire title to all or any part of the
Collateral securing a Loan, the Assignor shall, upon demand of the
Assignees, buy out the Assignees' Participation Interest in such a loan at the
sole and absolute discretion of the Assignees.

         13.      Repurchase Rights. Each of the Assignors will repurchase the
Assignees' Participation Interests at the Assignees' sole and absolute
discretion at any time "for cause." The term "for cause" shall be limited to
an Assignor's (i) material breach of the terms of this Agreement, (ii) fraud
committed against a Borrower or an Assignee, or (iii) criminal acts committed
against a Borrower or an Assignee.

                                       8
<PAGE>
         14.      Termination of this Agreement. Upon final payment in full of
the Loans and all obligations owing to the Assignees hereunder, this Agreement
shall terminate; provided, however, if all or any part of any payments to the
Assignees are invalidated or set aside or required to be repaid to any Person in
any Bankruptcy Proceeding or otherwise, then this Agreement shall be renewed as
of such date and shall thereafter continue in full force and effect to the
extent of the Loan so invalidated, set aside or repaid. If any portion of this
Agreement is declared to be invalid or unenforceable, then the remaining
portions of the Agreement shall remain in full force and effect.

         15.      Indemnification of the Assignees. Each of the Assignors hereby
jointly and severally indemnifies each of the Assignees for all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses and disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against the Assignees' or any one of them,
in any way relating to or arising out of this Agreement or the Assignees'
participation in any Loan, or by any action brought by any Borrower, including
all claims relating to the originator of the Loans, except for the gross
negligence or willful misconduct of the Assignees or the breach by the Assignees
of the terms of this Agreement.

         16.      Miscellaneous.

                  16.1     Amendments. Any amendment or waiver of any provision
of this Agreement shall be in writing, signed by the parties hereto. No failure
or delay by either party hereto in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, and any waiver of any breach of the
provisions of this Agreement shall be without prejudice to any rights with
respect to any other or further breach thereof.

                  16.2     No Set-Off. All payments made hereunder shall be made
without any set-off or counterclaim.

                  16.3     Costs and Expenses. Each of the Assignors and the
Assignees shall pay its own costs and expenses incurred in connection with the
negotiation, preparation and execution of this Agreement.

                  16.4     Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original and all of
which when taken together shall be deemed to constitute one and the same
instrument.

                  16.5     Further Assurances. Each of the Assignors and the
Assignees hereby agrees to execute and deliver such other instruments, and take
such other actions, as any other party may reasonably request of it, including
the delivery of any notices or other documents or instruments to any Borrower
which may be required in connection with the assignment and assumption
contemplated hereby.

                  16.6     Choice of Law; Venue. This Agreement shall be
governed by and construed in accordance with the laws of the State of
California, without regard to the conflicts of laws principles thereof. Any
dispute arising hereunder shall be heard by a court of competent jurisdiction
sitting in Contra Costa County, California.

                  16.7     Attorneys' Fees and Costs. In the event that a
dispute arises among the parties with respect to this Agreement or the
respective rights and obligations of the parties hereunder, the prevailing
party shall be awarded in costs and all attorneys' fees incurred by it in
connection with such dispute.

                                       9
<PAGE>
          16.8      WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO WAIVES ANY
RIGHT IT MIGHT HAVE TO REQUIRE A DISPUTE HEREUNDER TO BE HEARD BY A JURY.

          16.9      TIME. Time of the essence with respect to the performance by
each party hereto of its respective obligations hereunder.

          16.10.    NOTICES. All notices shall be given in writing, to the
address of the party to be notified as set forth in the Preamble hereof.

                      [Execution Page Follows Immediately]

                                       10

<PAGE>
     IN WITNESS WHEREOF, each of the Assignors and the Assignees has caused
this Agreement to be executed and delivered by its duly authorized
representative as of the Effective Date.

VESTIN MORTGAGE, INC.                        OWENS FINANCIAL GROUP, INC.
a Nevada corporation                         a California corporation

By:  /s/ Daniel B. Stubbs                    By: /s/ [ILLEGIBLE]
     ---------------------------------          --------------------------------
     Daniel B. Stubbs                        Its  Senior Vice President
Its: Senior Vice President                      --------------------------------

VESTIN FUND I, LLC,                          By: /s/ [ILLEGIBLE]
a Nevada limited liability company              --------------------------------
                                             Its  President
By:  Vestin Mortgage, Inc., a                   --------------------------------
     Nevada corporation, Manager

By:  /s/ Daniel B. Stubbs                    OWENS MORTGAGE INVESTMENT FUND,
     ---------------------------------       a California corporation
     Daniel B. Stubbs
Its: Senior Vice President
                                             BY OWENS FINANCIAL GROUP, INC.
                                                  a California corporation
VESTIN FUND II, LLC,                         ITS: General Partner
a Nevada corporation

By:  Vestin Mortgage, Inc., a
     Nevada corporation, Manager
                                             By: /s/ [ILLEGIBLE]
                                                --------------------------------
By:  /s/ Daniel B. Stubbs                    Its Senior Vice President
     ---------------------------------          --------------------------------
     Daniel B. Stubbs
Its: Senior Vice President
                                             By: /s/ [ILLEGIBLE]
                                                --------------------------------
                                             Its President
                                                --------------------------------

                                       11
<PAGE>
                                   EXHIBIT A
                                LOANS COMPRISING
                             THE PARTICIPATION POOL

<TABLE>
<CAPTION>
VESTIN LOAN              NAME OF                            LOAN
NUMBER                   BORROWER                           AMOUNT
-------------------------------------------------------------------------------
<S>                      <C>                                <C>
Loan #901-05-03          Red Mountain Resorts               $3,500,000.00

Loan #920-10-03          Emerald Suites Bonanza             $6,800,000.00

Loan #915-08-03          Presidio Kauai                     $23,000,000.00*
</TABLE>

* Incrementally funded loan. Figure indicated reflects total loan amount. Amount
funded to date is $14,781,272.00.
<PAGE>
                                   EXHIBIT B

                                     PART I

                                 Participations

Red Mountain Resorts
--------------------
Assignors: 42.85%
Assignees: 57.15%

Emerald Suites
--------------
Assignors: 41.17%
Assignees: 58.83%

Presidio Kauai
--------------
Assignors: 69.56%
Assignees: 30.44%
(Incrementally funded loan - figures indicated are based on loan as fully
funded. Actual amount after the agreement will be 52.65% Assignor / 47.35%
Assignee based on a principal balance of $14,781,272,00)

                           Advances Before Agreement
                           -------------------------
<Table>
<S>                 <C>
Assignors:

Red Mountain        $3,500,000.00
Emerald Suites      $6,800,000.00
Presidio Kauai      $23,000,000.00 (Incrementally funded loan. Figure indicated
                    reflects total loan amount. Amount funded to date
                    is $14,781,272.00)

Assignees:

Red Mountain        $0.00
Emerald Suites      $0.00
Presidio Kauai      $0.00
</Table>

                            Advances After Agreement
                            ------------------------

<Table>
<S>                 <C>
Assignors:

Red Mountain        $1,500,000.00
Emerald Suites      $2,800,000.00
Presidio Kauai      $16,000,000.00 (Incrementally funded loan. Figure indicated
                    is based on the total loan amount. Assignor's actual balance
                    after agreement will be $7,781,272 based on a principal
                    balance of $14,781,272.00)

Assignees:

Red Mountain        $2,000,000.00
Emerald Suites      $4,000,000.00
Presidio Kauai      $7,000,000.00
</Table>
<PAGE>

                                     PART 2

Assignee:   OWENS FINANCIAL GROUP, INC., a California corporation and
            OWENS MORTGAGE INVESTMENT FUND, a California limited partnership

Lending Office:   2221 Olympic Blvd., Walnut Creek, CA 94595

Address for Notices:  c/o William E. Dutra, Senior Vice President
                      2221 Olympic Blvd./ P.O. Box 2400
                      Walnut Creek, CA 94595

                      With a copy to Lender's Counsel:
                      Law Office of A. Nick Shamiyeh
                      2221 Olympic Blvd., Suite 100
                      Walnut Creek, CA 94595

Wiring Instructions:  CALIFORNIA BANK & TRUST
                      COMMERCIAL BANKING DIVISION
                      465 California Street
                      San Francisco, CA 94104
                      ABA #121002042
                      Account #017002445-70
                      Owens Financial Group General Account

                                     PART 3

Effective Date:  January 23, 2004

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00070-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00070-of-00352.parquet"}]]