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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 26, 1998.
NovaStar Mortgage Funding Trust, Series 1998-1
(Issuer in respect of the NovaStar Home Equity Loan Asset-
Backed Bonds Series 1998-1)
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(Exact name of registrant as specified in its charter)
Delaware 333-24327 51-6507815
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
c/o First Union National Bank,
230 S. Tryon Street, 9th Floor, Charlotte, NC 28288-1179
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (704) 383-9568
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(Former name or former address, if changed since last report.)
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Item 5. See the monthly statement to Bondholders attached as Exhibit
20.1 hereto reflecting the required information for the May 1998
payment to the NovaStar Home Equity Loan Asset-Backed Bonds Series
1998-1.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Item 601 (a) of Regulation.
S-K Exhibit Number.
20.1 Monthly statement to holders of NovaStar Home Equity Loan
Asset-Backed Bonds Series 1998-1 relating to the May 26, 1998
Payment Date.
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on behalf of NovaStar
Mortgage Funding Trust Series 1998-1 by the undersigned thereunto duly
authorized.
Dated: June 10, 1998 BY: First Union National Bank, as Indenture
Trustee and on behalf of NovaStar Home
Mortgage Funding Trust Series 1998-1
BY: /s/ Robert Ashbaugh
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Vice President
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EXHIBIT INDEX
20.1 Monthly statement to holders of NovaStar Home Equity Loan
Asset-Backed Bonds Series 1998-1 relating to the May 26, 1998
Payment Date.
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NovaStar Home Equity Loan Trust
NovaStar Home Equity Loan Asset-Backed Notes
Series 1998-1
Statement To Bondholder
<TABLE>
<CAPTION>
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DISTRIBUTIONS IN DOLLARS
PRIOR CUMULATIVE CURRENT
ORIGINAL PRINCIPAL REALIZED REALIZED DEFERRED PRINCIPAL
CLASS FACE VALUE BALANCE INTEREST PRINCIPAL TOTAL LOSSES LOSSES INTEREST BALANCE
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<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
BONDS 300,000,000.00 300,000,000.00 1,192,968.75 1,646,139.56 2,839,108.31 0.00 0.00 0.00 298,353,860.44
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TOTALS 300,000,000.00 300,000,000.00 1,192,968.75 1,646,139.56 2,839,108.31 0.00 0.00 0.00 298,353,860.44
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</TABLE>
<TABLE>
<S> <C>
Maximum Bond Interest Rate 13.50000%
Available Funds Interest Rate 8.46379%
Bond Interest Rate 5.72625%
</TABLE>
<TABLE>
<CAPTION>
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FACTOR INFORMATION PER $1000 OF ORIGINAL FACE PASS-THROUGH
PRIOR CURRENT RATES
PRINCIPAL PRINCIPAL
CLASS CUSIP BALANCE INTEREST PRINCIPAL TOTAL BALANCE CURRENT NEXT
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<S> <C> <C> <C> <C> <C> <C> <C> <C>
BONDS 66987XAA3 1,000.00 3.976563 5.487132 9.463694 994.51 5.726250% 6.048440%
</TABLE>
<TABLE>
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<S> <C>
SELLER: NOVASTAR FINANCIAL, INC.
SERVICER: NOVASTAR MORTGAGE CORPORATION
RECORD DATE: May 26, 1998
DISTRIBUTION DATE: April 30, 1998
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</TABLE>
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NovaStar Home Equity Loan Trust
NovaStar Home Equity Loan Asset-Backed Notes
Series 1998-1
Statement To Bondholder
<TABLE>
<S> <C>
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Distribution Date: May 26, 1998
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Aggregate Collections From the Mortgage Loans
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Total Collection on Pool 3,897,513.36
Total Servicer Advances 0.00
Total Compensating Interest 0.00
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Available Funds Cap Carry-Forward Amount 0.00
Aggregate Unpaid Available Funds Cap Carry-Forward Amount 0.00
Current Period Insured Payments Paid by Insurer 0.00
Aggregate Unreimbursed Insured Amounts Payable to Insurer 0.00
Aggregate Beginning Principal Balance of Mortgage Loans 303,030,303.14
Aggregate Ending Principal Balance of Mortgage Loans 301,384,163.58
Required Subordination Amount 3,030,303.14
Current Subordination Amount 3,030,303.14
Subordination Increase Amount 0.00
Subordination Reduction Amount 0.00
Net Monthly Excess Cashflow 1,011,755.70
Unpaid Accrued Interest 0.00
Current Realized Loss on Mortgage Loans 0.00
Aggregate Realized Loss on Mortgage Loans 0.00
Weighted Average Net Mortgage Rate 7.65492626%
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DELINQUENCY DELINQUENT DELINQUENT DELINQUENT LOANS IN REO
INFORMATION 30-59 DAYS 60-89 DAYS 90 + DAYS FORECLOSURE PROPERTY
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PRINCIPAL BALANCE 2,006,002.92 171,750.00 136,000.00 307,750.00 0.00
NUMBER OF LOANS 15 3 1 4 0
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REPURCHASE Current Cumulative
INFORMATION Period History
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PRINCIPAL BALANCE 0.00 0.00
NUMBER OF LOANS 0 0
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Cumulative Loss Percentage 0.00000%
Delinquency Percentage 0.04513%
Rolling Delinquency Percentage 0.04513%
Prepayment Interest Shortfalls 0.00
Relief Act Shortfalls 0.00
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</TABLE>
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NovaStar Home Equity Loan Trust
NovaStar Home Equity Loan Asset-Backed Notes
Series 1998-1
Statement To Certificateholder
<TABLE>
<CAPTION>
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DISTRIBUTIONS IN DOLLARS
PRIOR CUMULATIVE CURRENT
ORIGINAL PRINCIPAL REALIZED REALIZED DEFERRED PRINCIPAL
CLASS FACE VALUE BALANCE INTEREST PRINCIPAL TOTAL LOSSES LOSSES INTEREST BALANCE
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<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Certificate 0.00 0.00 1,011,755.70 0.00 1,011,755.70 0.00 0.00 0.00 0.00
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TOTALS 0.00 0.00 1,011,755.70 0.00 1,011,755.70 0.00 0.00 0.00 0.00
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</TABLE>
<TABLE>
<S> <C>
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SELLER: NOVASTAR FINANCIAL, INC.
SERVICER: NOVASTAR MORTGAGE CORPORATION
RECORD DATE:
DISTRIBUTION DATE: December 26, 1997
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