American Business Financial Services, Inc. Announces Newly Formed Division--American Business Mortgage Services, Inc.

Business Editors

BALA CYNWYD, Pa.--(BUSINESS WIRE)--Feb. 28, 2001

American Business Financial Services, Inc. (Nasdaq:ABFI) today announced the debut of American Business Mortgage Services, Inc. (ABMS), ABFI's newly formed business alliance group.

Comprising the former New Jersey Mortgage and Investment Corp. (NJMIC) and Processing Service Center (PSC), in addition to the Company's B2B e-commerce initiative, ABMS has an alliance-based business model as its shared element.

According to Ralph Hall, Chairman, American Business Mortgage Services, "We feel these alliance-based models are synergistic in their operations and their marketing. Through ABMS, we will remain committed to providing our broker affiliates with the same high level of service they have come to know through NJMIC. And, through the Bank Alliance Program, ABMS will continue to help their bank partners make loans to their nonprime borrowers, while keeping their customer relationships intact."

Overlaying the broker and bank partner alliances is ABMS' B2B e-commerce initiative. As part of this initiative, ABMS will market to brokers and banks the same proprietary loan structuring technology that is proving to be successful in ABFI's Consumer Mortgage Group.

"We look forward to seeing the results of this business," Hall said. "We already have a highly successful broker business and Bank Alliance Program. The implementation of this new technology should enable us to increase market share, and at the same time, drive down costs."

American Business Financial Services, Inc., is a diversified financial services holding company, which provides credit services and investment products to consumers and businesses, including business loans, first and second home equity mortgage loans and subordinated investment notes. The Company offers its products and services to consumers and businesses nationwide.

Certain statements contained in this press release, which are not historical fact, may be deemed to be forward-looking statements under federal securities laws. There are many important factors that could cause American Business Financial Services, Inc. and its subsidiaries' actual results to differ materially from those indicated in the forward-looking statements.

Such factors include, but are not limited to, general economic conditions, including interest rate risk, future residential real estate values, regulatory changes (legislative or otherwise) affecting the real estate market and mortgage lending activities, competition, demand for American Business Financial Services, Inc. and its subsidiaries' services, availability of funding, loan payment rates, delinquency and default rates, changes in factors influencing the loan securitization market and other risks identified in American Business Financial Services, Inc.'s Securities and Exchange Commission filings.