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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) DECEMBER 28, 1998.
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NovaStar Mortgage Funding Trust, Series 1998-2
(Issuer in respect of the NovaStar Home Equity Loan Asset-
Backed Bonds Series 1998-2)
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(Exact name of registrant as specified in its charter)
Delaware 333-24327 51-6509936
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
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<S> <C>
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)
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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 DECEMBER 1998 payment to the
NovaStar Home Equity Loan Asset-Backed Bonds Series 1998-2.
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 1998-2 relating to the DECEMBER 28, 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 1998-2 by the undersigned thereunto duly
authorized.
Dated: JANUARY 22, 1999 By: First Union National Bank, as Indenture
Trustee and on behalf of NovaStar Home
Mortgage Funding Trust Series 1998-2
BY: 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 1998-2 relating to the DECEMBER 28, 1998 Payment Date.
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NOVASTAR HOME EQUITY LOAN TRUST
NOVASTAR HOME EQUITY LOAN ASSET-BACKED BONDS
SERIES 1998-2
STATEMENT TO BONDHOLDER
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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>
A-1 115,000,000.00 110,584,370.15 481,257.65 1,001,930.90 1,483,188.55 0.00 0.00 0.00 109,582,439.25
A-2 200,000,000.00 192,320,643.76 819,340.43 1,742,488.53 2,561,828.96 0.00 0.00 0.00 190,578,155.23
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TOTALS 315,000,000.00 302,905,013.91 1,300,598.08 2,744,419.43 4,045,017.51 0.00 0.00 0.00 300,160,594.48
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MAXIMUM BOND INTEREST RATE 13.00000%
AVAILABLE FUNDS INTEREST RATE 9.00972%
BOND INTEREST RATE 5.22234%
GUARANTEED INTEREST PAYMENT $ 802,637.98
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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>
A-1 66987XAB1 961.603219 4.184849 8.712443 12.897292 952.890776 5.222340% 5.804380%
A-2 66987XAC9 961.603219 4.096702 8.712443 12.809145 952.890776 5.112340% 5.694380%
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<S> <C>
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Seller: NovaStar Financial, Inc.
Servicer: NovaStar Mortgage Corporation
Record Date: November 30, 1998
Distribution Date: December 28, 1998
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Page 1 of 2
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NOVASTAR HOME EQUITY LOAN TRUST
NOVASTAR HOME EQUITY LOAN ASSET-BACKED BONDS
SERIES 1998-2
STATEMENT TO BONDHOLDER
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<CAPTION>
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Distribution Date: December 28, 1998
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AGGREGATE COLLECTIONS FROM THE MORTGAGE LOANS
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<S> <C>
Total Collection on Pool 4,416,767.19
Total Servicer Advances 0.00
Total Compensating Interest 0.00
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<S> <C>
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 308,153,909.62
AGGREGATE ENDING PRINCIPAL BALANCE OF MORTGAGE LOANS 306,301,066.21
REQUIRED SUBORDINATION AMOUNT 11,970,000.00
CURRENT SUBORDINATION AMOUNT 6,140,471.73
SUBORDINATION INCREASE AMOUNT 891,576.02
SUBORDINATION REDUCTION AMOUNT 0.00
NET MONTHLY EXCESS CASHFLOW 0.00
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 9.47421308%
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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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<S> <C> <C> <C> <C> <C>
PRINCIPAL BALANCE 6,956,649.32 2,007,477.34 1,186,497.37 4,784,697.36 32,490.96
NUMBER OF LOANS 71 19 13 48 1
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REPURCHASE Current Cumulative
INFORMATION Period History
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<S> <C> <C>
PRINCIPAL BALANCE 0.00 42,388,504.45
NUMBER OF LOANS 0 493
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<S> <C>
CUMULATIVE LOSS PERCENTAGE 0.00000%
DELINQUENCY PERCENTAGE 0.38736%
ROLLING DELINQUENCY PERCENTAGE 0.25824%
PREPAYMENT INTEREST SHORTFALLS 0.00
RELIEF ACT SHORTFALLS 0.00
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