EXHIBIT 8.1





                                  June 10, 1999



         Re:      First Alliance Mortgage Company
                  First Alliance Mortgage Loan Trust 1999-2
                  Registration Statement on Form S-3 No. 333-44585

Ladies and Gentlemen:

         We have acted as counsel for First Alliance Mortgage Company in
connection with the preparation and filing of the registration statement on Form
S-3 (such registration statement, the "Registration Statement") filed with the
Securities and Exchange Commission pursuant to the Securities Act of 1933, as
amended (the "Act"), in respect of First Alliance Mortgage Loan Asset Backed
Certificates, Series 1999-2 (the "Certificates"). Our advice formed the basis
for the description of federal income tax consequences appearing under the
heading "Certain Federal Income Tax Consequences" in the prospectus supplement
contained in the Registration Statement. Such description does not purport to
discuss all possible federal income tax consequences of an investment in
Certificates but with respect to those tax consequences which are discussed, it
is our opinion that the description is accurate. In addition, assuming (i) the
REMIC election is made, (ii) the Pooling and Servicing Agreement is fully
executed, delivered and enforceable against the parties thereto in accordance
with its terms, (iii) the transaction described in the prospectus supplement is
completed on substantially the terms and conditions set forth therein, and (iv)
continuing compliance with the Pooling and Servicing Agreement, it is our
opinion that, for federal income tax purposes, the Trust (exclusive of the
Pre-Funding Account and the Capitalized Interest Account) will be treated as a
"REMIC" (as defined in the Code), each Class of the Class A Certificates will be
treated as "regular interests" in the REMIC and the Class R Certificates will be
treated as the sole class of "residual interests" in a REMIC.

         We hereby consent to the filing of this letter as an Exhibit to the
Registration Statement and to the reference to this firm in the Registration
Statement and related prospectus supplement under the heading "Certain Federal
Income Tax Consequences."

                                                Very truly yours,


                                                /s/ Arter & Hadden LLP
                                                ----------------------
                                                    Arter & Hadden LLP