================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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) October 25, 1996
SUPERIOR BANK FSB (as depositor under the Pooling and Servicing Agreement, dated
as of September 1, 1996, providing for the issuance of AFC Mortgage Loan Asset
Backed Certificates, Series 1996-3)
SUPERIOR BANK FSB
------------------------------------------------------
(Exact name of registrant as specified in its charter)
UNITED STATES 333-4492 36-1414142
- ---------------------------- ------------ ----------------------
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification Number)
ONE LINCOLN CENTRE
OAKBROOK TERRACE, ILLINOIS 60181
-------------------------- ----------
(Address of Principal (Zip Code)
Executive Offices)
Registrant's telephone number, including area code (708) 916-4000
================================================================================
<PAGE>
Item 5. Other Events
On October 25, 1996 (a "Remittance Date") a scheduled remittance was made
to the Certificateholders with respect to AFC Mortgage Loan Asset Backed
Certificates, Series 1996-3, issued pursuant to a Pooling and Servicing
Agreement, dated as of September 1, 1996, among Superior Bank FSB., as
Depositor, Lee Servicing Company, a division of Superior Bank FSB., as Servicer
and LaSalle National Bank, as Trustee. The information contained in the
Servicer's Monthly Remittance Report to the Trustee, which shall be forwarded by
the Trustee to the Certificateholders, is attached hereto as Exhibit 21.1 and is
incorporated herein by reference.
Capitalized terms used herein and not defined shall have the same meanings
ascribed to them in the pooling and Servicing Agreement.
Items 2 through 4 and Items 6 and 8 are not included because they are not
applicable.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Not applicable
(b) Not applicable
(c) Exhibits
21.1 Monthly Remittance Report for the month of October, 1996.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SUPERIOR BANK F.B.
By: /s/ WILLIAM C. BRACKEN
---------------------------------
Name: William C. Bracken
Title: Executive Vice President
Dated: October, 1996
EXHIBITS TABLE
21.1 Monthly Remittance Report for the month of October, 1996.
<PAGE>
ALLIANCE FUNDING COMPANY
by LEE SERVICING COMPANY, a division of SUPERIOR BANK, FSB
Designated Servicer
SERVICER'S CERTIFICATE
1996-3 Sub-Pool 1
In accordance with section 6.08 of the Pooling and Servicing Agreement
dated as of September 1, 1996
Lee Servicing Company reports the following
information pertaining to Series 1996-3 Sub-Pool 1
for October 25, 1996, the Remittance date.
Due period ended: October 1, 1996
--------------------------------------------------------------------------
--------------------------------------------------------------------------
1 Total Actual Principal Collections 453,310.02
2 Total Actual Interest Collections 281,691.41
3 Additional Proceeds 0.00 1 of 4
---------------------
4 Total Collections: 735,001.43
5 Pre-Funding Account Transfer 0.00
6 Interest Coverage Account Transfer 518,792.11
---------------------
7 Aggregate Amount Received: 1,253,793.54
Monthly Advances
8 Delinquent Interest 621,902.48
9 Compensating Interest 710.47
10 Amounts Held for Future Distributions 0.00
11 Reserve Withdrawal per Sec. 6.14c 0.00
---------------------
12 Available Remittance Amount: 1,876,406.49
13 Service Fees 44,943.02
14 Expense Account Deposit: 3,738.67
15 Cross Collateral Deposit 0.00
---------------------
16 Adjusted Remittance Amount: 1,827,724.80
Remaining Amount Available:
17 Adjusted Remittance Amount 1,827,724.80
18 Insured Payments 0.00
19 Insurance Account Deposit @ 13 bp
the Ending Principal Balance 16,200.89
20 Cross Collateral Withdrawal 0.00
21 Class Remittance Amounts 1,811,523.91
22 Non-Recoverable Advances not
Previously Reimbursed 0.00
=====================
23 Total Remaining Amount Available: 0.00
=====================
Amount of Reimbursements Pursuant to Sec. 5.04
24 Servicing Fee 0.00
25 Monthly Advances and Servicer Advances 0.00
26 Other Mortgage Payments 0.00
27 Interest Earned on P&I Deposits 0.00
28 Additional Servicing Compensation 0.00
--------------------------------------------------------------------------
--------------------------------------------------------------------------
<PAGE>
ALLIANCE FUNDING COMPANY
by LEE SERVICING COMPANY, a division of SUPERIOR BANK, FSB
Designated Servicer
SERVICER'S CERTIFICATE
1996-3 Sub-Pool 1
In accordance with section 6.08 of the Pooling and Servicing Agreement
dated as of September 1, 1996
Lee Servicing Company reports the following
information pertaining to Series 1996-3 Sub-Pool 1
for October 25, 1996, the Remittance date.
Due period ended: October 1, 1996
<TABLE>
<CAPTION>
Total Class A-1 Class A-2 Class A-3 Class A-4
----- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
29 Loans Outstanding - BOM 1536
30 Original Loan Balance 93,528,661.75 41,776,135.59 6,547,006.32 15,743,991.39 5,923,481.91
31 Pre-Funding Account Balance 57,955,886.82 25,886,962.77 4,056,912.08 9,755,907.62 3,670,539.50
32 Initial Overcollateralization 1,484,548.57 663,098.36 103,918.40 249,899.01 94,021.41
33 Realized Losses, LTD 0.00 0.00 0.00 0.00 0.00
34 Carryforward Amount 0.00 0.00 0.00 0.00 0.00
---------------------------------------------------------------------------------------
35 Total Class Principal Balance 150,000,000.00 67,000,000.00 10,500,000.00 25,250,000.00 9,500,000.00
36 Pool Factor per Loan Balance 62.3524412% 27.8507571% 4.3646709% 10.4959943% 3.9489879%
37 Pool Factor per Class Balance 100.0000000% 100.0000000% 100.0000000% 100.0000000% 100.0000000%
38 Excess Spread 0.00
39 Cross Collateral Withdrawal 0.00
40 Cross Collateral Deposit 0.00 0.00
41 Additional Principal due Class A 514,399.30 514,399.30
42 Interest Remittance @ Class Yield 843,814.59 314,062.50 63,175.00 157,391.67 59,691.67
Principal Additions:
43 Number of loans 444
44 Transfers from Pre-Funding Account 25,086,692.04 11,205,389.11 1,756,068.44 4,222,926.49 1,588,823.83
Principal Reductions:
45 Prepayments - Number 7 7
46 Prepayments - Dollar 377,994.25 377,994.25 0.00 0.00 0.00
47 Net Liquidation Proceeds 0.00 0.00 0.00 0.00 0.00
48 Curtailments 0.00 0.00 0.00 0.00 0.00
49 Normal and Excess Payments 75,315.77 75,315.77 0.00 0.00 0.00
50 Pre-Funding Account Transfer 0.00 0.00 0.00 0.00 0.00
---------------------------------------------------------------------------------------
51 Total Principal Remittance 453,310.02 453,310.02 0.00 0.00 0.00
52 Additional Principal Reduction 514,399.30 514,399.30 0.00 0.00 0.00
=======================================================================================
53 Total Remittance 1,811,523.91 1,281,771.82 63,175.00 157,391.67 59,691.67
=======================================================================================
54 Current Month Realized Loss - number 0 0
55 Current Month Realized Loss - dollar 0.00 0.00
Class Principal Balance - EOM
56 Loans Outstanding - EOM 1973
57 Closing Loan Balance 118,162,043.77 52,528,214.68 8,303,074.76 19,966,917.88 7,512,305.74
58 Pre-Funding Account Balance 32,869,194.78 14,681,573.66 2,300,843.64 5,532,981.13 2,081,715.67
59 Additional Principal Reduction, LTD 1,998,947.87 1,177,497.66 103,918.40 249,899.01 94,021.41
60 Realized losses, LTD 0.00 0.00 0.00 0.00 0.00
---------------------------------------------------------------------------------------
61 Total Class Principal Balance 149,032,290.68 66,032,290.68 10,500,000.00 25,250,000.00 9,500,000.00
62 Pool Factor per Loan Balance 78.7746958% 35.0188098% 5.5353832% 13.3112786% 5.0082038%
63 Pool Factor per Class Balance 99.3548605% 98.5556577% 100.0000000% 100.0000000% 100.0000000%
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Class A-5 Class A-6 Class R
--------- --------- -------
29 Loans Outstanding - BOM
30 Original Loan Balance 16,367,515.81 7,170,530.73
31 Pre-Funding Account Balance 10,142,280.19 4,443,284.66 2 of 4
32 Initial Overcollateralization 259,796.00 113,815.39
33 Realized Losses, LTD 0.00 0.00
34 Carryforward Amount 0.00 0.00
---------------------------------------
35 Total Class Principal Balance 26,250,000.00 11,500,000.00
36 Pool Factor per Loan Balance 10.9116772% 4.7803538%
37 Pool Factor per Class Balance 100.0000000% 100.0000000%
38 Excess Spread 0.00
39 Cross Collateral Withdrawal 0.00
40 Cross Collateral Deposit
41 Additional Principal due Class A
42 Interest Remittance @ Class Yield 172,156.25 77,337.50
Principal Additions:
43 Number of loans
44 Transfers from Pre-Funding Account 4,390,171.11 1,923,313.06 0.00
Principal Reductions:
45 Prepayments - Number
46 Prepayments - Dollar 0.00 0.00
47 Net Liquidation Proceeds 0.00 0.00
48 Curtailments 0.00 0.00
49 Normal and Excess Payments 0.00 0.00
50 Pre-Funding Account Transfer 0.00 0.00
------------------------------------------------------
51 Total Principal Remittance 0.00 0.00
52 Additional Principal Reduction 0.00 0.00
======================================================
53 Total Remittance 172,156.25 77,337.50 0.00
======================================================
54 Current Month Realized Loss - number
55 Current Month Realized Loss - dollar
Class Principal Balance - EOM
56 Loans Outstanding - EOM
57 Closing Loan Balance 20,757,686.92 9,093,843.79
58 Pre-Funding Account Balance 5,752,109.08 2,519,971.60
59 Additional Principal Reduction, LTD 259,796.00 113,815.39
60 Realized losses, LTD 0.00 0.00
-------------------------------------
61 Total Class Principal Balance 26,250,000.00 11,500,000.00
62 Pool Factor per Loan Balance 13.8384579% 6.0625625%
63 Pool Factor per Class Balance 100.0000000% 100.0000000%
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
ALLIANCE FUNDING COMPANY
by LEE SERVICING COMPANY, a division of SUPERIOR BANK, FSB
Designated Servicer
SERVICER'S CERTIFICATE
1996-3 Sub-Pool 1
In accordance with section 6.08 of the Pooling and Servicing Agreement
dated as of September 1, 1996
Lee Servicing Company reports the following
information pertaining to Series 1996-3 Sub-Pool 1
for October 25, 1996, the Remittance date.
Due period ended: October 1, 1996
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Total Class A-1 Class A-2 Class A-3 Class A-4
----- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
64 Weighted Note Rate - THIS Remittance 11.57720 %
65 Weighted Note Rate - NEXT Remittance 11.57720 %
66 Related Remittance Period for Libor Rate 25-Sep-96 thru 24-Oct-96
67 Days in Related Period 30
68 Pass-Through Rates 5.62500% 7.22% 7.48% 7.54%
69 Weighted Average Remaining Term 217.12
70 Original Pool - Principal Balance 93,528,661.75 41,776,135.59 6,547,006.32 15,743,991.39 5,923,481.91
71 Original Pool - Pre-Funding Account 57,955,886.82 25,886,962.77 4,056,912.08 9,755,907.62 3,670,539.50
72 Original Pool - Additional Principal Reduction 1,484,548.57 663,098.36 103,918.40 249,899.01 94,021.41
---------------------------------------------------------------------------------
73 Original Pool Total 150,000,000.00 67,000,000.00 10,500,000.00 25,250,000.00 9,500,000.00
74 Original Pool - Number of Loans 1536
-------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
<CAPTION>
Class A-5 Class A-6
--------- ---------
<S> <C> <C>
64 Weighted Note Rate - THIS Remittance
3 of 4
65 Weighted Note Rate - NEXT Remittance
66 Related Remittance Period for Libor Rate
67 Days in Related Period
68 Pass-Through Rates 7.87% 8.07%
69 Weighted Average Remaining Term
70 Original Pool - Principal Balance 16,367,515.81 7,170,530.73
71 Original Pool - Pre-Funding Account 10,142,280.19 4,443,284.66
72 Original Pool - Additional Principal Reduction 259,796.00 113,815.39
----------------------------------------------
73 Original Pool Total 26,250,000.00 11,500,000.00
74 Original Pool - Number of Loans
--------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Class A Overcollateralization Reconciliation
--------------------------------------------
Beg.of Month Current Month End of Month
------------------------------------------------------
<S> <C> <C> <C>
75 Additional Principal Reduction, LTD 1,484,548.57 514,399.30 1,998,947.87
76 Cross Collateral Deposits 0.00 0.00 0.00
77 Less: Realized Losses, LTD 0.00 0.00 0.00
------------------------------------------------------
78 Overcollateralization of Principal 1,484,548.57 514,399.30 1,998,947.87
======================================================
79 Base Overcollateralization Required 7,907,493.00
80 Required Overcollateralization Amount 7,907,493.00
Current Month Subordinated Amount Beg.of Month Current Month End of Month
--------------------------------- ------------------------------------------------------
81 Original Subordinated Amount 16,754,191.00 N/A 16,754,191.00
82 Less: Cumulative Realized Losses 0.00 0.00 0.00
83 Plus: Cumulative Additional Proceeds 0.00 0.00 0.00
======================================================
84 Current Subordinated Amount 16,754,191.00 16,754,191.00
======================================================
Nonrecoverable Advance Reconciliation
-------------------------------------
85 Beginning of Month 0.00
86 Current Month Unpaid Nonrecoverable Advance 0.00
87 Less: Current Month Reimbursement 0.00
-------------------
88 End of Month 0.00
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
ALLIANCE FUNDING COMPANY
by LEE SERVICING COMPANY, a division of SUPERIOR BANK, FSB
Designated Servicer
SERVICER'S CERTIFICATE
1996-3 Sub-Pool 1
In accordance with section 6.08 of the Pooling and Servicing Agreement
dated as of September 1, 1996
Lee Servicing Company reports the following
information pertaining to Series 1996-3 Sub-Pool 1
for October 25, 1996, the Remittance date.
Due period ended: October 1, 1996
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Class Class Class Class
A1 A2 A3 A4
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
89 Total Class Principal - Original Pool $150,000,000.00 $67,000,000.00 $10,500,000.00 $25,250,000.00 $9,500,000.00
90 Interest Remittance Amount 843,814.59 314,062.50 63,175.00 157,391.67 59,691.67
91 Interest Rate Factor / 1000 5.625431 4.687500 6.016667 6.233333 6.283334
92 Total Principal Collections 453,310.02 453,310.02 0.00 0.00 0.00
93 Prefunding Account Transfer 0.00 0.00 0.00 0.00 0.00
94 Additional Principal Reduction 514,399.30 514,399.30 0.00 0.00 0.00
---------------------------------------------------------------------------------------
95 Principal Remittance Amount 967,709.32 967,709.32 0.00 0.00 0.00
96 Principal Payment Factor/1000 6.451395 14.443423 0.000000 0.000000 0.000000
97 Principal Factor 993.548605 985.556577 1,000.000000 1,000.000000 1,000.000000
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
<CAPTION>
Class Class
A5 A6
--------------------------------------
<S> <C> <C>
89 Total Class Principal - Original Pool $26,250,000.00 $11,500,000.00 4 of 4
90 Interest Remittance Amount 172,156.25 77,337.50
91 Interest Rate Factor / 1000 6.558333 6.725000
92 Total Principal Collections 0.00 0.00
93 Prefunding Account Transfer 0.00 0.00
94 Additional Principal Reduction 0.00 0.00
--------------------------------------
95 Principal Remittance Amount 0.00 0.00
96 Principal Payment Factor/1000 0.000000 0.000000
97 Principal Factor 1,000.000000 1,000.000000
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
ALLIANCE FUNDING COMPANY
by LEE SERVICING COMPANY, A division of SUPERIOR BANK FSB,
Designated Servicer
SERVICERS CERTIFICATE
1996-3 SUB POOL 2
In accordance with section 6.08 of the Pooling and Servicing Agreement
dated as of September 01, 1996
and the Insurance Agreement dated as of September 25, 1996,
Lee Servicing Company reports the following
information pertaining to series 1996-3 Sub Pool 2
for October 25, 1996, the Remittance date.
Period Ended: October 1, 1996
-------------------------------------------------------------------------
1 Total Actual Principal Collections 118,941.56
2 Total Actual Interest Collections 105,861.66
3 Additional Proceeds 0.00 Page 1 of 4
-----------
4 Total Collections: 224,803.22
5 Pre-Funding Account Transfer 0.00
6 Interest Coverage Account Transfer 267,560.62
-----------
7 Aggregate Amount Received: 492,363.84
Monthly Advance
8 Delinquent Interest 365,760.13
9 Compensating Interest 332.81
10 Amounts Held for Future Distributions 0.00
11 Supplemental Interest 0.00
12 Reserve Withdrawal Per Sec. 6.08 VII 0.00
-----------
13 Available Remittance Amount: 858,456.78
14 Less: Service Fees 24,363.15
15 Less: Expense Account Deposit 2,247.03
16 Cross Collateral Deposit 0.00
-----------
17 Adjusted Remittance Amount: 831,846.60
Remaining Amount Available:
18 Adjusted Remittance Amount 831,846.60
19 Insured Payments 0.00
20 Insurance Account Deposit @ 13bp
the Ending Class Principal Balance 9,737.11
21 Class Remittance Amounts 822,109.49
22 Cross Collateral Withdrawal 0.00
23 Non-Recoverable Advances not
Previously Reimbursed 0.00
===========
24 Total Remaining Amount Available: 0.00
===========
Amount of Reimbursements Pursuant to Sec. 5.04
25 Servicing Fee 0.00
26 Monthly Advances and Servicer Advances 0.00
27 Other Mortgage Payments 0.00
28 Interest Earned on P&I Deposits 0.00
29 Additional Servicing Compensation 0.00
-------------------------------------------------------------------------
-------------------------------------------------------------------------
<PAGE>
ALLIANCE FUNDING COMPANY
by LEE SERVICING COMPANY, A division of SUPERIOR BANK FSB,
Designated Servicer
SERVICERS CERTIFICATE
1996-3 SUB POOL 2
In accordance with section 6.08 of the Pooling and Servicing Agreement
dated as of September 01, 1996
and the Insurance Agreement dated as of September 25, 1996,
Lee Servicing Company reports the following
information pertaining to series 1996-3 Sub Pool 2
for October 25, 1996, the Remittance date.
Period Ended: October 1, 1996
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------
Total Class 2-A Class R
----- --------- -------
<S> <C> <C>
30 Number of Loans 479
31 Original Principal Balance 56,969,975.31 56,969,975.31
32 Original Pre-Funding Account Balance 35,337,717.00 35,337,717.00 Page 2 of 4
33 Initial Overcollateralization 2,307,692.31 2,307,692.31
34 Realized Losses, LTD 0.00 0.00
35 Carryforward Amount 0.00 0.00
-------------------------------------
36 Opening Class Principal Balance 90,000,000.00 90,000,000.00
37 Pool Factor per Loan Balance 63.2999726% 63.2999726%
38 Pool Factor per Class Balance 100.0000000% 100.0000000%
39 Excess Spread 0.00 0.00
40 Additional Principal due Class A 267,417.93 267,417.93
41 Cross Collateral Deposit 0.00 0.00
42 Cross Collateral Withdrawal 0.00 0.00
43 Interest Remittance 435,750.00 435,750.00
Principal Additions:
44 Number of Loans 165
45 Transfers from Pre-Funding Account 18,663,345.48 18,663,345.48
Principal Reductions:
46 Prepayments - Number 1 1
47 Prepayments - Dollar 94,250.00 94,250.00
48 Net Liquidation Proceeds 0.00 0.00
49 Curtailments 0.00 0.00
50 Normal and Excess Payments 24,691.56 24,691.56
51 Pre-Funding Account Transfer 0.00 0.00
---------------------------------------------------------
52 Total Principal Remittance 118,941.56 118,941.56
53 Additional Principal Reduction 267,417.93 267,417.93
=========================================================
54 Total Remittance 822,109.49 822,109.49 0.00
=========================================================
55 Carryforward Amount 0.00
56 Current Month Realized Loss - Number 0 0
57 Current Month Realized Loss - Dollar 0.00 0.00
Class Principal Balance - EOM
58 Number of Loans # 643
59 Closing Loan Balance 75,514,379.23 75,514,379.23
60 Pre-Funding Account Balance 16,674,371.52 16,674,371.52
61 Additional Principal Reduction, LTD 2,575,110.24 2,575,110.24
62 Realized Losses, LTD 0.00 0.00
63 Carryforward Amount 0.00 0.00
-------------------------------------
64 Closing Class Principal Balance 89,613,640.51 89,613,640.51
65 Pool Factor per Loan Balance 83.9048658% 83.9048658%
66 Pool Factor per Class Balance 99.5707117% 99.5707117%
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
ALLIANCE FUNDING COMPANY
by LEE SERVICING COMPANY, A division of SUPERIOR BANK FSB,
Designated Servicer
SERVICERS CERTIFICATE
1996-3 SUB POOL 2
In accordance with section 6.08 of the Pooling and Servicing Agreement
dated as of September 01, 1996
and the Insurance Agreement dated as of September 25, 1996,
Lee Servicing Company reports the following
information pertaining to series 1996-3 Sub Pool 2
for October 25, 1996, the Remittance date.
Period Ended: October 1, 1996
<TABLE>
<CAPTION>
Total Class A1
----- --------
<C> <C> <C>
67 Weighted Note Rate - This Remittance: 9.96277% Page 3 of 4
68 Weighted Note Rate - Next Remittance: 9.96277%
69 Pass-Through Rate: 5.81000% 5.81000%
70 Related Remittance Period: 25-Sep-96 thru 24-Oct-96
71 Days in Related Period: 30
72 Weighted Average Remaining Term 357.69
73 Original Pool - Principal Balance 56,969,975.31 56,969,975.31
74 Original Pool - Pre-Funding Account Balance 35,337,717.00 35,337,717.00
75 Original Pool - Initial Overcollateralization 2,307,692.31 2,307,692.31
-----------------------------------
76 Original Pool - Class Principal Balance 90,000,000.00 90,000,000.00
77 Original Pool - Number of Loans 479
----------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Class A Overcollateralization Reconciliation
-------------------------------------------- Beginning of Month Current Month End of Month
------------------------------------------------------
<C> <C> <C> <C>
78 Initial Overcollateralization 2,307,692.31 267,417.93 2,575,110.24
79 Cross Collateral Deposits, LTD 0.00 0.00 0.00
80 Less: Realized Losses, LTD 0.00 0.00 0.00
======================================================
81 Overcollateralization of Principal 2,307,692.31 267,417.93 2,575,110.24
======================================================
82 Base Overcollateralization Requirement 3,876,923.00
83 Required Overcollateralization 3,876,923.00
Current Month Subordinated Amount Beginning of Month Current Month End of Month
--------------------------------- ------------------------------------------------------
84 Original Subordinated Amount 9,249,230.00 N/A 9,249,230.00
85 Less: Cumulative Realized Losses 0.00 0.00 0.00
86 Plus: Cumulative Additional Proceeds 0.00 0.00 0.00
======================================================
87 Current Subordinated Amount 9,249,230.00 9,249,230.00
======================================================
Nonrecoverable Advance Reconciliation
-------------------------------------
88 Beginning of Month 0.00
89 Current Month Nonrecoverable Advance 0.00
90 Less: Current Month Reimbursment 0.00
===================
91 End of Month 0.00
===================
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
ALLIANCE FUNDING COMPANY
by LEE SERVICING COMPANY, A division of SUPERIOR BANK FSB,
Designated Servicer
SERVICERS CERTIFICATE
1996-3 SUB POOL 2
In accordance with section 6.08 of the Pooling and Servicing Agreement
dated as of September 01, 1996
and the Insurance Agreement dated as of September 25, 1996,
Lee Servicing Company reports the following
information pertaining to series 1996-3 Sub Pool 2
for October 25, 1996, the Remittance date.
Period Ended: October 1, 1996
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
Class
A1
--------------------------------
<S> <C> <C>
92 Total Class Principal - Original Pool $90,000,000.00 $90,000,000.00 Page 4 of 4
93 Interest Remittance Amount 435,750.00 435,750.00
94 Interest Rate Factor / 1000 4.841667 4.841667
95 Total Principal Collections 118,941.56 118,941.56
96 Prefunding Account Transfer 0.00 0.00
97 Additional Principal Reduction 267,417.93 267,417.93
--------------------------------
98 Principal Remittance Amount 386,359.49 386,359.49
99 Principal Payment Factor/1000 4.292883 4.292883
100 Principal Factor 995.707117 995.707117
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
</TABLE>
