Amendment and Restatement No. 3 to

        Certificate of Incorporation (as previously amended and restated)

                  Of American Business Financial Services, Inc.



         This is to certify that the Certificate of Incorporation of American
Business Financial Services, Inc. (previously known as KINGSWAY ENTERPRIZES,
INC.) originally filed with the Secretary of State of the State of Delaware on
February 25, 1985 and as amended on April 25, 1985, July 8, 1985, March 11,
1986, and as amended and restated on February 12, 1993, and July 11, 1996, has
been further amended and restated. The amendment and restatement herein
certified have been duly adopted by the stockholders in accordance with the
provisions of Sections 242 and 245 of the General Corporation Law of the State
of Delaware and shall read in full as follows:

         FIRST: The name of the corporation is American Business Financial
Services, Inc. (the "Corporation").

         SECOND: The address of the registered office in the State of Delaware
is 103 Springer Building, 3411 Silverside Road, in the City of Wilmington,
County of New Castle. The name of its registered agent at such address is
Organization Services, Inc.

         THIRD: The purposes for which the Corporation was formed are to engage
in any lawful act or activity for which corporations may be organized under the
Delaware General Corporation Law.

         FOURTH: The total number of shares of all classes of stock which the
Corporation shall have authority to issue is 12,000,000 shares, consisting of
3,000,000 shares of Preferred Stock, par value $.001 per share, as more fully
described in Section A below (the "Preferred Stock"), and 9,000,000 shares of
Common Stock, par value $.001 per share, as more fully described in Section B
below (the "Common Stock").

         A. Preferred Stock. The shares of Preferred Stock may be divided and
issued from time to time in one or more series as may be designated by the Board
of Directors of the Corporation, each such series to be distinctly titled and to
consist of the number of shares designated by the Board of Directors. All shares
of any one series of Preferred Stock so designated by the Board of Directors
shall be alike in every particular, except that shares of any one series issued
at different times may differ as to the dates from which dividends thereon (if
any) shall accrue or be cumulative (or both). The designations, preferences and
relative, participating, optional or other special rights (if any), and the
qualifications, limitations or restrictions thereof (if any), of any series of
Preferred Stock may differ from those of any and all other series at any time
outstanding. The Board of Directors of the Corporation is hereby expressly
vested with authority to fix by resolution the powers, designations, preferences
and relative, participating, optional or other special rights (if any), and the
qualifications, limitations or restrictions and (if any), of the Preferred Stock
and each series thereof which my be designated by the Board of Directors,
including, but without limiting the generality of the foregoing, the following:

                                       1


                  (1) The voting rights and powers (if any) of the Preferred
Stock and each series thereof;

                  (2) The rates and times at which, and the terms and conditions
on which, dividends (if any) on the Preferred Stock, and each series thereof,
will be paid and any dividend preferences or rights of cumulation;

                  (3) The rights (if any) of holders of the Preferred Stock, and
each series thereof, to convert the same into, or exchange the same for, shares
of other classes (or series of classes) of capital stock of the Corporation and
the terms and conditions for such conversion or exchange, including provisions
for adjustment of conversion or exchange prices or rates in such events as the
Board of Directors shall determine;

                  (4) The redemption rights (if any) of the Corporation and of
the holders of the Preferred Stock, and each series thereof, and the times at
which, and the terms and conditions on which, the Preferred Stock, and each
series thereof, may be redeemed; and

                  (5) The rights and preferences (if any) of the holders of the
Preferred Stock, and each series thereof, upon the voluntary or involuntary
liquidation, dissolution or winding up of the Corporation.

         B. Common Stock. All shares of Common Stock shall be identical and
shall entitle the holders thereof to the same rights and privileges.

                  (1) Dividends. When and as dividends are declared upon the
Common Stock, whether payable in cash, in property or in shares of stock of the
Corporation, the holders of Common Stock shall be entitled to share equally,
share for share, in such dividends.

                  (2) Voting Rights. Each holder of Common Stock shall be
entitled to one vote per share.

                  (3) Liquidation. In the event of any liquidation, dissolution
or winding up of the Corporation, whether voluntary or involuntary, after
payment shall have been made to holders of the Preferred Stock of the full
amounts to which they shall be entitled as stated and expressed herein or as may
be stated and expressed pursuant hereto, the holders of Common Stock shall be
entitled, to the exclusion of the holders of the Preferred Stock (except to the
extent otherwise specifically provided in such Preferred Stock), to share
ratably according to the number of shares of the Common Stock held by them in
all remaining assets of the Corporation available for distribution to its
stockholders.

         C. Other Provisions. No holder of any of the shares of any class or
series of stock or options, warrants or other rights to purchase shares of any
class of stock or of other securities of the Corporation shall have any
preemptive right to purchase or subscribe for any unissued stock of any class or
series or any additional shares of any class or series to be issued by reason of
any increase of the authorized capital stock of the Corporation of any class or
series, or bonds, certificates of indebtedness, debentures or other securities
convertible into or exchangeable for stock of the Corporation of any class or
series, or carrying any right to purchase stock of any class or series, but any
such unissued stock, additional authorized shares of any class or series of
stock or securities convertible into or exchangeable for stock, or carrying any
right to purchase stock, may be issued and disposed of pursuant to resolution of
the Board of Directors to such persons, films, corporations or associations,
whether any such persons, firms, corporations or associations are holders or
others, and upon such terms as may be deemed advisable by the Board of Directors
in the exercise of its sole discretion.

                                        2


         FIFTH: The board of Directors shall consist of not less than one (1)
nor more than fifteen (15) persons, the exact number to be fixed and determined
from time to time by resolution of the Board of Directors.

         SIXTH: Prior to the first closing date for the public offering of the
Common Stock which occurs on or after the date of this Certificate, the
directors shall be elected for such term as is specified in the Bylaws of the
Corporation in effect on the date of this Certificate, as such Bylaws are
amended from time to time. On and after the first closing date for the public
offering of the Common Stock which occurs on or after the date of this
Certificate, the directors shall be divided into three (3) classes, known as
Class 1, Class 2, and Class 3. The initial directors of Class 1 shall serve
until the first (1st) annual meeting of stockholders. At the first (1st) annual
meeting of stockholders, the directors of Class 1 shall be elected for a term of
three (3) years and, after the expiration of such term, shall thereafter be
elected every three (3) years for three (3) year terms. The initial directors of
Class 2 shall serve until the second (2nd) annual meeting of stockholders. At
the second (2nd) annual meeting of the shareholder, the directors of Class 2
shall be elected for a term of three (3) years and, after the expiration of such
term, shall thereafter be elected every three (3) years for three (3) year
terms. The initial directors of Class 3 shall serve until the third (3rd) annual
meeting of stockholders. At the third (3rd) annual meeting of the stockholders,
the directors of Class 3 shall be elected for a term of three (3) years and,
after expiration of such term, shall thereafter be elected every three (3) years
for three (3) year terms. Each director shall serve until his successor shall
have been elected and shall qualify, even though his term of office as herein
provided has otherwise expired, except in the event of his earlier death,
resignation, removal or disqualification. This Article Sixth, or any portion
thereof, may be changed by a Bylaw amendment which is adopted by all of the then
members of the Board of Directors.

         SEVENTH: Section 228 of the Delaware General Corporation Law shall not
be applicable unless the resolution or other matter contained in the written
consent or consents from stockholders has been previously approved by all of the
then members of the Board of Directors.

         EIGHTH: The Corporation shall indemnify the directors and executive
officers of the Corporation and hold them harmless to the fullest extent
permitted by the provisions of the Delaware General Corporation Law. In the
event that the Delaware General Corporation Law is amended, after the date of
this Certificate, to authorize corporate action further eliminating or limiting
the personal liability of directors and officers (whether an executive officer
or not), then the liability of a director or officer of the Corporation shall be
eliminated or limited to the fullest extent permitted by the Delaware General
Corporation Law, as so amended.

                                       3


                  The Corporation shall pay the expenses incurred by a director
or executive officer in defending any civil, criminal, administrative, or
investigative action, suit or proceeding in advance of the final disposition of
such action, suit or proceeding upon receipt of an undertaking by or on behalf
of such director or officer to repay such amount if it should be ultimately
determined that he or she is not entitled to be indemnified by the Corporation
as authorized by the Delaware General Corporation Law.

                  Any amendment or repeal of this Eighth Article by the
stockholders of the Corporation shall not adversely affect any right or
protection of the director of officer of the Corporation existing at the time of
such amendment or repeal. Nothing contained herein shall prevent the corporation
from supplementing the indemnification provisions contained herein by Bylaw
provisions, contracts with directors or officers, insurance or otherwise.

         NINTH: To the fullest extent permitted by law as presently in effect or
as hereafter amended from time to time, a director shall have no personal
liability to the Corporation or stockholders for monetary damages for breach of
fiduciary duty as a director. Any amendment to or repeal of this Article Ninth
shall not adversely affect any right or protection of a director of this
Corporation for or with respect to any acts or omissions of such director
occurring prior to such amendment or repeal.

         TENTH: In furtherance and not in limitation of the powers conferred by
the laws of the State of Delaware, the Board of Directors of the Corporation is
expressly authorized and empowered to adopt, amend or repeal the Bylaws of the
Corporation.

         ELEVENTH: The Corporation reserves the right at any time and from time
to time to amend or repeal any provision contained in this Certificate of
Incorporation; and other provisions authorized by the laws of the State of
Delaware at the time in force may be added or inserted, in the manner now or
hereafter prescribed by law; and all rights, preferences and privileges of
whatsoever nature conferred upon stockholders, directors or any other persons
whomsoever by and pursuant to this Certificate of Incorporation in its present
form or as hereafter amended are granted subject to the right reserved in this
Article.

         TWELFTH: In the event that all, some or any part of any provision
contained in this Amended and Restated Certificate of Incorporation shall be
found by any court of competent jurisdiction to be illegal, invalid or
unenforceable (as against public policy or otherwise), such provision shall be
enforced to the fullest extent permitted by law and shall be construed as if it
had been narrowed only to the extent necessary so as not to be invalid, illegal
or unenforceable; the validity, legality and enforceability of the remaining
provisions of this Amended and Restated Certificate of Incorporation shall
continue in full force and effect and shall not be affected or impaired by such
illegality, invalidity or unenforceability of any other provision (or any part
or parts thereof) of the Amended and Restated Certificate of Incorporation. If
and to the extent that any provision contained in this Amended and Restated
Certificate of Incorporation violates any rule of a securities exchange or
automated quotation system on which securities of the Corporation are traded,
the Board of Directors is authorized, in its sole discretion, to suspend or
terminate such provision for such time or periods of time and subject to such
conditions as the Board of Directors shall determine.

                                       4


                  IN WITNESS WHEREOF, American Business Financial Services, Inc.
has caused this Certificate to be signed this 18th day of December, 2002.



ATTEST:                                     AMERICAN BUSINESS FINANCIAL
                                             SERVICES, INC.


/s/ Beverly Santilli                         /s/ Anthony J. Santilli
----------------------------                 --------------------------------
Beverly Santilli                             Anthony J. Santilli
Secretary                                    Chief Executive Officer









                                       5