RAIT INVESTMENT TRUST
FIRST AMENDMENT TO LOAN & SECURITY AGREEMENT
<DOCUMENT>
<TYPE>EX-10.7
<SEQUENCE>5
<FILENAME>w83630exv10w7.txt
<DESCRIPTION>FIRST AMENDMENT TO LOAN & SECURITY AGREEMENT
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                                                                    Exhibit 10.7

                 FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT

      This First Amendment to Loan Agreement (the "First Amendment") is made
this 17th day of October, 2002, by and between RAIT PARTNERSHIP, L.P., a limited
partnership organized and existing under the laws of the State of Delaware (the
"Borrower") and COMMERCE BANK, N.A., a national banking association (the
"Bank"). All capitalized terms used herein and not otherwise defined shall have
the meanings set forth in the Loan (herein defined).

                                   BACKGROUND

      The Bank and the Borrower are parties to a certain Loan and Security
Agreement dated October 1, 2002 (the "Loan Agreement"), pursuant to which the
Bank made available to Borrower a Line of Credit in the original principal
amount of Twenty Million Dollars ($20,000,000).

      The Bank and the Borrower are mutually desirous of amending the Loan
Agreement and are entering into this First Amendment to set forth their entire
understanding and agreement with respect thereto.

      NOW, THEREFORE, in consideration of the mutual covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby mutually acknowledged, the parties hereto,
intending to be legally bound hereby, agree as follows:

      1.    Section 3.6 of the Loan Agreement is hereby added and shall read as
            follows:

            "Section 3.6. Release of Collateral. At any time that Borrower and
            Bank agree to release or replace Collateral, Bank agrees to
            cooperate in assigning any mortgages and other loan documents back
            to Borrower in a timely manner."

      2. The Bank and the Borrower hereby ratify and confirm the Loan Agreement
and agree that the Loan Agreement as so amended remains in full force and
effect.

               [REMAINDER OF THIS PAGE LEFT BLANK INTENTIONALLY.]
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      IN WITNESS WHEREOF, Borrower and Bank have executed this Fourth Amendment
on the day and year first above written.

                                         BORROWER:

                                         RAIT PARTNERSHIP, L.P.
                                         By: RAIT General, Inc.

                                         By: /s/ Scott Schaeffer
                                             ----------------------------------
                                             Name: Scott Schaeffer
                                             Title: President

                                         BANK:

                                         COMMERCE BANK, N.A.

                                         By: /s/ Seth Mackler
                                             ----------------------------------
                                             Name:  Seth Mackler
                                             Title: Vice President


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