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AutoBond Acceptance Corp. Updates Investors With Respect to Its Litigation With Dynex

19 May 1999

AutoBond Acceptance Corp. Updates Investors With Respect to Its Litigation With Dynex

    AUSTIN, Texas, May 18 -- AutoBond Acceptance Corporation
(Amex: ABD) ("AutoBond"), listed on the Amex under the symbol ABD, is updating
investors with respect to its litigation with Dynex Capital, Inc.
("Dynex").
    AutoBond's lawsuit in Texas State Court against Dynex, filed on
February 8, 1999, has been set for trial in Texas State Court for December,
1999.  Dynex's motion to dismiss this action was denied by a Judge.
    Dynex's lawsuit in New York Federal Court, filed on February 22, 1999 was
transferred by a Judge's Order to Virginia Federal Court.
    Dynex's lawsuit in Virginia Federal Court (including the matters
transferred from New York) against AutoBond, filed on February 9, 1999, has
been transferred by a Judge's Order dated May 17, 1999 to Texas Federal Court.
    There is no Dynex related litigation pending in Virginia.  All remaining
litigation is pending in Texas.
    AutoBond currently has 6,531,311 common shares and 1,125,000 preferred
shares outstanding.  AutoBond is a specialty consumer finance company engaged
in underwriting, acquiring, servicing and securitizing retail installment
contracts originated primarily by franchised automobile dealers in connection
with the sale of used and, to a lesser extent, new vehicles to selected
consumers with limited access to traditional sources of credit.  AutoBond is
located in Austin, Texas and acquires contracts nationwide from dealers in
approximately 40 states.
    The above statements include information that should be considered
forward-looking within the meaning of the Private Securities Litigation Reform
Act of 1995, and in addition involve a number of risks and uncertainties.
    Note:  This is not an offer to buy or sell securities or assets of any
kind.