December 18, 1998




First Union Capital Markets,
   a division of Wheat First Securities, Inc.
301 South College Street
Charlotte, North Carolina 28288

Prudential Securities Incorporated
One New York Plaza
New York, New York 10292-2015

MBIA Insurance Corporation
113 King Street
Armonk, New York 10504

            Re:   Mortgage Lenders Network Home Equity Loan Trust 1998-3
                  Asset Backed Notes, Series 1998-3

Ladies and Gentlemen:

            We have acted as special tax counsel in connection with the issuance
and delivery of certain notes denominated as Mortgage Lenders Network Home
Equity Loan Trust 1998-3, Series 1998-3 Notes, Class A (the "Notes") pursuant to
the terms of the Indenture (the "Indenture"), dated as of December 1, 1998,
between the Mortgage Lenders Network Home Equity Loan Trust 1998-3 (the
"Issuer") and Norwest Bank Minnesota, National Association, as indenture trustee
(the "Indenture Trustee"). Capitalized terms used herein but not defined herein
shall have the meanings ascribed to them in the Indenture.

            In rendering the opinions expressed below, we have examined the
following documents:

            (a)   The Registration Statement, the Base Prospectus, and the
                  Prospectus Supplement, all relating to the Notes;

            (b)   The Deposit Trust Agreement;

            (c)   The Indenture; and



            (d)   Such other documents as we have deemed necessary or
                  appropriate as a basis for the opinions set forth below.

            We do not purport to express an opinion on any laws other than the
federal income tax law of the United States of America. No opinion has been
sought and none has been given concerning the tax treatment of the issuance and
sale of the Notes under the laws of any state.

            In our examination we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals, the
conformity to original documents of all documents submitted to us as certified
or photostatic copies and the authenticity of the originals of such latter
documents.

            We have examined the question of whether the Notes will be treated
as indebtedness for federal income tax purposes. Our analysis is based on the
provisions of the Internal Revenue Code of 1986, as amended, and the Treasury
Regulations promulgated thereunder as in effect on the date hereof and on
existing judicial and administrative interpretations thereof. These authorities
are subject to change and to differing interpretations, which could apply
retroactively. The opinion of special tax counsel is not binding on the courts
or the Internal Revenue Service (the "IRS").

            In general, whether a transaction constitutes the issuance of
indebtedness for federal income tax purposes is a question of fact, the
resolution of which is based primarily upon the economic substance of the
instruments and the transaction pursuant to which they are issued rather than
the form of the transaction or the manner in which the instruments are labeled.
The IRS and the courts have set forth various factors to be taken into account
in determining whether or not a transaction constitutes the issuance of
indebtedness for federal income tax purposes, which we have reviewed as they
apply to this transaction.

            Based on the foregoing, and such legal and factual investigations as
we have deemed appropriate, while no transaction closely comparable to that
contemplated in the Basic Documents has been the subject of any Treasury
regulation, revenue ruling or judicial decision, and therefore the matter is
subject to interpretation, we are of the opinion that for federal income tax
purposes:

            (1) The Notes will properly be treated as indebtedness for federal
      income tax purposes and not as an ownership interest in the Mortgage
      Loans, or an equity interest in the Issuer or in a separate association
      taxable as a corporation or other taxable entity;

            (2) Neither the Issuer nor the Mortgage Pool will be characterized
      as an association (or a publicly traded partnership) taxable as a
      corporation or a taxable mortgage pool.

            We express no opinion on any matter not discussed in this letter.
This opinion is rendered as of the Closing Date, for the sole benefit of the
addressees hereof


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and it may not be relied on by any other party or quoted without our express
consent in writing.

            We consent to reliance on this opinion letter by you and by
Richards, Layton & Finger, for the purpose of issuing their opinion with respect
to the tax treatment of the Trust under Delaware law. Except as provided in the
proceeding sentence, this opinion letter may not be relied upon by, nor may
copies be delivered to, any person without our prior written consent. We do not
undertake to advise you of any changes in the opinions expressed herein from
matters that might hereafter arise or be brought to our attention.

                                    Very truly yours,

                                    /s/ Dewey Ballantine LLP