INSURANCE AND REIMBURSEMENT AGREEMENT





                                      among





                           MBIA INSURANCE CORPORATION,



             ABFS MORTGAGE LOAN WAREHOUSE TRUST 2001-1, as the Trust



                        ABFS OSO, INC., as the Depositor



          AMERICAN BUSINESS CREDIT, INC., as Originator and as Servicer



                    HOMEAMERICAN CREDIT, INC., as Originator



            AMERICAN BUSINESS MORTGAGE SERVICES, INC., as Originator



          AMERICAN BUSINESS FINANCIAL SERVICES, INC., as the Guarantor



                 THE CHASE MANHATTAN BANK, as Indenture Trustee



                                       and



             TRIPLE-A ONE FUNDING CORPORATION, as Initial Purchaser











                           Dated as of March 28, 2001



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                                TABLE OF CONTENTS



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TABLE OF CONTENTS.................................................................................................i



ARTICLE I

         DEFINITIONS..............................................................................................4

         Section 1.1.  General Definitions........................................................................4

         Section 1.2.  Generic Terms..............................................................................5



ARTICLE II

         THE INSURANCE POLICY; REIMBURSEMENT......................................................................5

         Section 2.1.  Insurance Policy...........................................................................5

         Section 2.2.  Conditions Precedent to Issuance of the Insurance Policy...................................5

         Section 2.3.  Premium Supplement.........................................................................8

         Section 2.4.  Reimbursement Obligations..................................................................8

         Section 2.5.  Option to Fund Payments....................................................................9

         Section 2.6.  Subrogation................................................................................9



ARTICLE III

         REPRESENTATIONS AND WARRANTIES...........................................................................9

         Section 3.1.  Representations and Warranties of the ABFS Companies.......................................9

         Section 3.2.  Representations and Warranties Incorporated by Reference..................................11



ARTICLE IV

         COVENANTS...............................................................................................11

         Section 4.1.  Affirmative Covenants of the Originators..................................................11

         Section 4.2.  Affirmative Covenants of  the Servicer, the Depositor and Trust...........................12



ARTICLE V

         FURTHER AGREEMENTS......................................................................................13

         Section 5.1.  Obligations Absolute......................................................................13

         Section 5.2.  Reinsurance...............................................................................14

         Section 5.3.  Liability of MBIA.........................................................................14

         Section 5.4.  Fees and Expenses.........................................................................15



ARTICLE VI

         INDEMNIFICATION.........................................................................................15

         Section 6.1.  Indemnification...........................................................................15



ARTICLE VII

         DEFAULTS; REMEDIES......................................................................................17

         Section 7.1.  Events of Default.........................................................................17

         Section 7.2.  Remedies; No Remedy Exclusive.............................................................18

         Section 7.3.  Waivers...................................................................................18

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ARTICLE VIII

         MISCELLANEOUS...........................................................................................19

         Section 8.1.  Amendments, Etc...........................................................................19

         Section 8.2.  Notices...................................................................................19

         Section 8.3.  No Waiver; Remedies and Severability......................................................20

         Section 8.4.  Payments..................................................................................21

         Section 8.5.  GOVERNING LAW, JURY TRIAL WAIVER; SUBMISSION TO JURISDICTION..............................21

         Section 8.6.  Indenture Trustee Acts or Omissions.......................................................22

         Section 8.7.  Survival of Representations and Warranties................................................22

         Section 8.8.  Bankruptcy................................................................................22

         Section 8.9.  Counterparts..............................................................................22

         Section 8.10.  Paragraph Headings, Etc..................................................................22

         Section 8.11.  Termination..............................................................................23

         Section 8.12.  Further Assurances.......................................................................23

         Section 8.13.  Consent of MBIA or the Initial Purchaser.................................................23



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                      INSURANCE AND REIMBURSEMENT AGREEMENT



         THIS INSURANCE AND REIMBURSEMENT AGREEMENT (the "Insurance Agreement")

is made as of March 28, 2001 among MBIA INSURANCE CORPORATION, a New York stock

insurance company ("MBIA"), ABFS Mortgage Loan Warehouse Trust 2001-1, a

Delaware business trust (the "Trust"), ABFS OSO, Inc., a Delaware corporation

(the "Depositor"), American Business Credit, Inc., a Pennsylvania corporation

("ABC", and, in its capacity as servicer under the Sale and Servicing Agreement,

the "Servicer"), HomeAmerican Credit, Inc., a Pennsylvania corporation d/b/a

Upland Mortgage ("Upland"), American Business Mortgage Services, Inc., a New

Jersey corporation ("ABMS" and, together with ABC and Upland, each an

"Originator" and collectively the "Originators"), American Business Financial

Services, Inc., a Delaware corporation (the "Guarantor"), The Chase Manhattan

Bank, as indenture trustee under the Indenture referred to below (the "Indenture

Trustee") and Triple-A One Funding Corporation, a Delaware Corporation (the

"Initial Purchaser").



                             PRELIMINARY STATEMENTS



         Pursuant to: (i) the Sale and Servicing Agreement, the Originators will

from time to time transfer certain Mortgage Loans to the Depositor and the

Depositor will simultaneously transfer such Mortgaged Loans to the Trust and

(ii) the Indenture, dated as of March 1, 2001 (as amended or modified from time

to time, the "Indenture"), between the Trust and the Indenture Trustee, the

Trust will issue the ABFS Mortgage Loan Warehouse Trust 2001-1, Mortgage Backed

Note (the "Note").



         MBIA is authorized to transact a financial guaranty insurance business

in the State of New York and has agreed to issue to the Indenture Trustee for

the benefit of the Noteholder (as defined in the Indenture) the Insurance Policy

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