Exhibit 5.2


                                January 21, 1998


First Alliance Mortgage Company
17305 Von Karman Avenue
Irvine, California  92614-6203

         Re: First Alliance Mortgage Company
             Mortgage Loan Asset Backed Notes
             Registration Statement on Form S-3

Ladies and Gentlemen:

         We have acted as counsel to First Alliance Mortgage Company (the
"Company") in connection with the preparation and filing of the registration
statement on Form S-3 (such registration statement, the "Registration
Statement") being filed today with the Securities and Exchange Commission
pursuant to the Securities Act of 1933, as amended (the "Act"), in respect of
Mortgage Loan Asset Backed Notes (the "Notes") which you plan to offer in
series, each series to be issued under a separate indenture (an "Indenture"), in
substantially the form set forth as an exhibit to the Registration Statement,
among a business trust formed by the Company (the "Issuer") pursuant to an trust
agreement substantially in the form set forth as an exhibit to the Registration
Statement, and a trustee (the "Indenture Trustee") to be identified in the
prospectus supplement for such series of Notes.

         We have examined and relied on the originals or copies certified or
otherwise identified to our satisfaction of all such documents and records of
the Company and such other instruments and other certificates of public
officials, officers and representatives of the Company and such other persons,
and we have made such investigations of law, as we deemed appropriate as a basis
for the opinions expressed below.

         The opinions expressed below are subject to bankruptcy, insolvency,
reorganization, moratorium and other laws relating to or affecting creditors'
rights generally and to general equity principles.

         This opinion is limited to matters involving the Federal laws of the
United States of America and the laws of the State of California. All opinions
expressed herein are based on laws, regulations and policy guidelines currently
in force and may be affected by future regulations.

         Based upon the foregoing, we are of the opinion that:







         1. When, in respect of a series of Notes, an Indenture has been duly
authorized by all necessary action and duly executed and delivered by the Issuer
and the Indenture Trustee for such series, such Indenture, will be a valid and
legally binding obligation of the Issuer; and

         2. When an Indenture for a series of Notes has been duly authorized by
all necessary action and duly executed and delivered by the Issuer and the
Indenture Trustee for such series, and when the Notes of such series have been
duly executed and authenticated in accordance with the provisions of the
Indenture and issued and sold as contemplated in the Registration Statement and
the prospectus, as amended or supplemented, delivered pursuant to Section 5 of
the Act in connection therewith, such Notes will be valid and binding
non-recourse obligations of such Issuer, enforceable against such Issuer, in
accordance with their terms.

         We hereby consent to the filing of this opinion as Exhibit 5.2 to the
Registration Statement and to the reference to this firm in the Registration
Statement and the related prospectus under the heading "Legal Matters".

         This opinion is furnished by us as counsel to the company and is solely
for the benefit of the addressee thereof. It may not be relied upon by any other
person or for any other purpose without our prior written consent.

                                          Very truly yours,


                                         /S/ Arter & Hadden LLP
                                         -------------------------
                                         Arter & Hadden LLP