[SEGMENT-NAME]  OPINION
















                         BAKER & DANIELS
                    300 North Meridian Street
                            Suite 2700
                   Indianapolis, IN  46204-1782
                          (317) 237-0300



May 18, 1994 




American General Finance Corporation
601 N.W. Second Street
Evansville, Indiana  47708

     Re:  6-5/8% Senior Notes due June 1, 1997

Ladies and Gentlemen:

     We  have  acted  as  counsel  to  American  General  Finance
Corporation,   an  Indiana   corporation   (the  "Company"),   in
connection  with  the  issuance  and   sale  by  the  Company  of
$150,000,000 aggregate  principal amount of  the Company's 6-5/8%
Senior  Notes  due  June 1, 1997  (the  "Notes"),  including  the
preparation of:

     (a)  The  Company's  Registration   Statement  on   Form S-3
(Registration   No. 33-57910)  (the   "Registration  Statement"),
including  the  Prospectus, dated  March 1, 1993,  constituting a
part thereof (the "Prospectus").

     (b)  The  Pricing Agreement,  dated May 17,  1994, including
the  Underwriting  Agreement  incorporated therein,  between  the
Company  and the underwriter of the Notes (together, the "Pricing
Agreement").

     (c)  The  Senior Indenture,  dated  as of  February 1, 1993,
between the  Company and Citibank, N.A., as  Trustee, pursuant to
which the Notes are to be issued (the "Indenture").

     For purposes of this opinion, we  have examined originals or
copies,  identified  to  our  satisfaction,  of  such  documents,
corporate records, instruments and other relevant materials as we
have  deemed  advisable; and  we  have made  such  examination of







statutes and decisions and  reviewed such questions of law  as we
have considered necessary or  appropriate. In our examination, we
have  assumed  the  genuineness  of  all  signatures,  the  legal
capacity  of  all  natural   persons,  the  authenticity  of  all
documents  submitted  to  us  as  originals,  the  conformity  to
original  documents of all  documents submitted to  us as copies,
and  the authenticity  of the  originals of such  copies.   As to
facts material to this opinion, we have relied upon certificates,
statements or  representations of public  officials, of  officers
and  representatives of  the Company and  of others,  without any
independent verification thereof. 

     The  laws  covered  by  the opinions  expressed  herein  are
limited to the laws of the  State of Indiana and the federal laws
of the United States.

     On the basis of and subject  to the foregoing, we are of the
opinion that:

     1.   The Company is existing as a corporation under the laws
of the State of Indiana.

     2.   The  issuance of the Notes has  been duly authorized by
all necessary corporate action of the Company and, when the Notes
have  been duly  executed, authenticated,  sold and  delivered in
accordance  with the terms of  the Indenture and  as described in
the  Registration Statement  and  in the  Pricing Agreement,  the
Notes  will  be valid  and  binding obligations  of  the Company,
enforceable against  the Company in accordance  with their terms,
except  as  enforcement thereof  may  be  limited by  bankruptcy,
insolvency, fraudulent conveyance, reorganization,  moratorium or
other  laws of  general  applicability relating  to or  affecting
enforcement of creditors' rights or by general equity principles.

     We consent  to the filing of  this opinion as  an exhibit to
the Registration Statement and  to the reference to us  under the
heading  "Legal  Opinions" in  the  Prospectus.   In  giving such
consent,  we do not  admit that  we come  within the  category of
persons  whose  consent  is   required  under  Section 7  of  the
Securities Act of 1933,  as amended, or the rules  or regulations
of the Securities and Exchange Commission thereunder.

                              Yours very truly,


                              /s/  BAKER & DANIELS