SSG Client Transactions

Title

American Business Financial Services, Inc.

Client Profile

American Business Financial Services, Inc. ("ABFS" or the "Company") originates, sells and services sub-prime consumer mortgage loans. These loans are secured by first and second mortgages on one-to-four family residences and provided primarily to credit-impaired borrowers who are generally unable to obtain financing from traditional banks or savings and loan associations.

Situation

In 2003 and 2004, the Company endured a liquidity crisis due to (1) its inability to securitize loans, (2) reduced warehouse line capacity, and (3) the cessation of its subordinated note program. As a result, the Company filed for Chapter 11 bankruptcy protection in January 2005.

Solution

SSG was retained with the mandate of obtaining a Debtor-In-Possession loan facility adequate to fund working capital requirements, as well as the capital necessary to originate new mortgage loans. Under a demanding timeframe, SSG assisted ABFS in raising a $500 million DIP loan ensuring operational solvency and the ability to generate new loans going forward.

February 2005

$500,000,000

Debtor-In-Possession Financing

provided to