EMPLOYMENT AGREEMENT

Exhibit 10.8

EMPLOYMENT AGREEMENT



THIS EMPLOYMENT AGREEMENT, dated as of August 31, 1996, is between
Dynex Capital, Inc. a Virginia corporation (the "Company"), and William J. Moore
(the "Executive"). In consideration of the mutual covenants and representations
herein contained and the mutual benefits derived herefrom, the parties,
intending to be legally bound, covenant and agree as follows:

1. Purpose. The Company, directly and indirectly through its
subsidiaries and affiliates, is principally engaged in the sourcing,
underwriting, processing, origination, purchase and securitization of mortgage
loans secured by commercial (i.e., income producing) real estate (collectively,
the "Business"). The Company wishes to employ the Executive, and the Executive
has agreed to be employed by the Company, on the terms and conditions herein
provided.

2. Full-Time Employment of Executive - Duties and Status.

(a) The Company hereby engages the Executive as a full-time
executive employee for the period commencing as of the date hereof and expiring
on August 31, 2001 (the "Employment Period") and the Executive accepts such
employment, on the terms and conditions set forth in this Agreement. During the
term of Executive's employment under this Agreement, Executive shall serve as
President of the Company and as Chairman of the Board of Multi-Family Capital
Markets, Inc. ("MCM"), a subsidiary of the Company. Throughout the Employment
Period, the Executive shall faithfully exercise such authority and perform such
executive duties as are assigned to him from time to time by the Board of
Directors of the Company. The Executive shall perform such duties primarily in
Richmond, Virginia but also in such locations as are directed by the Board of
Directors of the Company.

(b) Throughout the Employment Period, the Executive shall
devote his full time and efforts to the business of the Company, its
subsidiaries and affiliates and will not engage in consulting work or any trade
or business for his own account or for or on behalf of any other person, firm or
corporation which competes, conflicts or interferes with the performance of his
duties hereunder in any way.

(c) The Executive shall be entitled to such vacation, leave of
absence, and leave for illness or temporary disability policies as are in effect
as policies of the Company.

3. Compensation and General Benefits. As full
compensation for his services to the Company, the Executive shall,
during the Employment Period, be compensated as follows:

(a) Salary. The Company shall pay to the Executive a salary
(the "Salary") at an annual rate of One Hundred Fifty Thousand Dollars
($150,000). The Salary shall be payable in periodic equal installments not less
frequently than monthly, less such sums as may be required to be deducted or
withheld under applicable provisions of federal, state and local law and such
amounts as may be owed to the Company or its subsidiaries pursuant to Section
3(e) below or such other amounts as may be mutually agreed upon by the Executive
and the Company.

(b) Bonus. During the term of this Agreement, Executive shall
be entitled to earn annual cash bonuses of up to 75% of the Executive's Salary
upon achievement of performance goals established by the Chairman of the Board
of the Company for its senior officers. Such goals shall be specific to the
Executive's responsibilities, except that between 25% and 50% of the Executive's
bonus may be based upon the earnings per share performance of Resource Mortgage
Capital, Inc. ("Resource"), an affiliate of the Company. The Chairman of the
Board may establish such goals in its sole discretion and shall have full
discretion in the determination as to whether any such goals have been met.

Notwithstanding the foregoing, Executive shall be entitled to
be paid a cash bonus of at least (i) $33,333.33 for the period commencing on the
date of this Agreement through December 31, 1996 and (ii) $100,000 for twelve
(12) months ending December 31, 1997. Such bonuses will be paid within 45 days
after the end of the period to which it relates.

(c) Resource Stock Incentive Plan. During the term of this
Agreement, the Executive shall be entitled to participate in the Resource
Mortgage Capital, Inc. 1992 Stock Incentive Plan according to its terms as the
same may be amended by Resource from time to time and the Compensation Committee
of the Board of Directors of Resource shall grant awards thereunder to the
Executive as are granted from time to time to other comparable executives of
Resource generally on the same terms as such other executives.

(d) Expenses. The Company shall reimburse the Executive from
time to time for all reasonable and customary business expenses incurred by him
in the performance of his duties hereunder, provided that the Executive has had
such expenses pre-approved and shall submit vouchers and other supporting data
to substantiate the amount of said expenses in accordance with Company policy
from time to time in effect.

4. Non-Competition; Confidential Information; Public
Statements.

(a) Non-Competition. The Executive and the Company recognize
that due to the Executive's engagement hereunder and the relationship of the
Executive to the Company, the Executive will have access to and will acquire,
and may assist in developing, confidential and proprietary information relating
to the assets, business and operations of the Company and its affiliates,
including, without limiting the generality of the foregoing, information with
respect to the Company's and its affiliates' present and prospective
technologies, systems, customers, accounts, deposits, loans and sales and
marketing methods. The Executive acknowledges that such information has been and
will continue to be of central importance to the business of the Company and its
affiliates and that disclosure of it to, or its use by, others could cause
substantial loss to the Company. The Executive and the Company also recognize
that an important part of the Executive's duties may be to develop goodwill for
the Company and its affiliates through his personal contact with customers,
agents and others having business relationships with the Company and its
affiliates, and that there is a danger that this goodwill, a proprietary asset
of the Company and its affiliates, may follow the Executive if and when his
relationship with the Company is terminated. The Executive accordingly agrees
that unless the Executive's employment is terminated without cause as
hereinafter defined, at all times during the Employment Period and, in the case
of actions specified in (ii), (iii), (iv) and (vi) below, for a period of two
years after the termination of the Executive's employment, the Executive shall
not, in any capacity whatsoever, whether directly or indirectly, through any
entity, family member or otherwise, on his own behalf, or on behalf of any other
person, firm, partnership, corporation, limited liability company, association
or other entity (collectively, "Person"):

(i) own, manage, invest, participate or
engage in any activity which comprises or is similar to the Business
anywhere in the United States;

(ii) suggest to, induce or persuade any
vendor or customer of the Company or its affiliates to discontinue doing
business, with, or to change the terms or conditions of such relationship with
the Company or its affiliates, or otherwise disparage, disrupt or disturb the
relationship of the Company or its affiliates with such vendor or customer;

(iii) suggest to, induce or persuade any
vendor or customer of the Company or its affiliates to do business with any
other Person which conducts a business competitive with the Business;

(iv) suggest to, induce, solicit or persuade
any employee or consultant of the Company or its affiliates, with the exception
of the blood relatives of the Executive, to leave the employ or engagement of
the Company or its affiliates;

(v) participate in planning for and will not
accept any employment in or associate with any Person whose business
competes with the Business of the Company or its affiliates; and

(vi) without limiting the term of his general
obligation to honor the Confidential Information so long as it remains
protectable, the Executive specifically agrees that he will not plan for, accept
employment from any Person, nor directly or indirectly engage in, any business
wherein the loyal and diligent performance of the duties and responsibilities of
such new employment or business will inherently call upon him to use, to
disclose or to base judgments upon Confidential Information of the Company or
its affiliates or to utilize the goodwill of the Company in making sales for a
competitor of the Company or its affiliates.

The foregoing restrictive period is based upon the Executive's and the Company's
good faith belief that:

(A) the Company's investment of time and
money in training and educating the Executive, and the nature of the Company's
and its affiliates' business (which is maintained and increased through the
personal contact of employees such as the Executive with customers and vendors
and potential customers and vendors of the Company and its affiliates) has and
will continue to render the Executive a unique asset to the Company;

(B) the Company and its affiliates would
be placed at a competitive disadvantage for such period, due to the Executive's
knowledge of Confidential Information (as defined below) and other matters
arising out of his employment with the Company; and

(C) the time required to rebuild the
contacts and patronage that the Executive will develop for the Company and its
affiliates and to provide the necessary training, exposure and education to his
replacement would, for such a period, place the Company and its affiliates at a
competitive disadvantage.

(b) Confidential Information.

(i) At all times during the Employment Period
and at all times following termination thereof, the Executive shall keep
confidential and not disclose, directly or indirectly, and shall not use for the
benefit of himself or any other individual, corporation, partnership, or other
entity except in connection with and furtherance of the business and the affairs
of the Company, any Confidential Information (as defined below) relating to any
aspect of the business of the Company which is not known or which may become
known to him, unless and until it has become public knowledge or has come into
the possession of others by legal and equitable means. For purposes of this
Agreement, "Confidential Information" means any common law trade secret or other
item constituting "Trade Secrets" under the Virginia Uniform Trade Secrets Act,
Section 59.1-336, Developed Information (as defined below) or other information,
whether in written, oral or other form, that is unique, confidential or
proprietary to the Company or its affiliates.

(ii) For purposes of this Agreement,
"Developed Information" shall mean all Trade Secrets and unique, confidential
and proprietary information conceived, developed, designed, devised or otherwise
created, modified or improved by the Executive or in whole or in part, in
connection with the performance of his services for the Company hereunder during
the Employment Period or resulting from the Executive's use of or access to the
Company's facilities or resources, including its Confidential Information. The
"Developed Information" shall be deemed to comprise a portion of the
Confidential Information.

(iii) The Executive acknowledges that all
Confidential Information is the property of the Company or its affiliates, and
upon expiration of the Employment Period or earlier termination of this
Agreement or earlier at the request of the Company, the Executive shall deliver
to the Company all records, notes, reference items, memoranda, records, and
other documents or materials, and all copies thereof (including but not limited
to such items stored by computer memory or other media) which constitute or
incorporate the Confidential Information which are in the Executive's possession
or under his control.

(c) Ownership of Developed Information. The Executive covenants
and agrees that all right, title and interest in any Developed Information shall
be and remain the exclusive property of the Company. The Executive agrees to
immediately disclose to the Company all Developed Information, and to assign to
the Company any right, title and interest which he may have in the Developed
Information. The Executive agrees to execute any instruments and to do all
things reasonably requested by the Company, both during and after the Employment
Period, to vest the Company with all ownership rights in the Developed
Information. If any Developed Information can be protected by copyrights (i) as
to that Developed Information which falls within the definition of "work made
for hire," as defined in 17 U.S.C. Section 101, the copyright to such Developed
Information shall be owned solely, completely and exclusively by the Company,
and (ii) as to that Developed Information which does not constitute "work made
for hire," the copyright to such Developed Information shall be deemed to be
assigned and transferred completely and exclusively by the Executive to the
Company.

(d) Acknowledgment. The Executive acknowledges that he has
carefully read and reviewed the restrictions set forth in Sections 4(a) and (b)
hereof, and having done so he agrees that those restrictions, including but not
limited to the time period and geographical areas of restriction, are fair and
reasonable and are reasonably required for the protection of the legitimate
business interests of the Company and its affiliates.

(e) Invalidity, Etc.. If any covenant, provision, or agreement
contained in any part of Sections 4(a) or (b) hereof is found by a court having
jurisdiction to be unreasonable in duration, geographic scope or character of
restrictions, the covenant, provision or agreement shall not be rendered
unenforceable thereby, but rather the duration, geographical scope or character
of restrictions of such covenant, provision or agreement shall be deemed reduced
or modified with retroactive effect to render such covenant or agreement
reasonable and such covenant or agreement shall be enforced as modified. If the
court having jurisdiction will not review the covenant, provision or agreement,
the parties shall mutually agree to a revision having an effect as close as
permitted by law to the provision declared unenforceable. The Executive agrees
that if a court having jurisdiction determines, despite the express intent of
the Executive, that any portion of the restrictive covenants contained in
Sections 4(a) or (b) hereof are not enforceable, the remaining provisions shall
be valid and enforceable.

(f) Equitable Relief. The Executive recognizes and acknowledges
that if he breaches the provisions of Sections 4(a) or (b) hereof, damages to
the Company would be difficult if not impossible to ascertain, and because of
the immediate and irreparable damage and loss that may be caused to the Company
for which it would have no adequate remedy, it is therefore agreed that the
Company, in addition to and without limiting any other remedy or right it may
have, shall be entitled to have an injunction or other equitable relief in a
court of competent jurisdiction, enjoining any such breach, and the Executive
hereby waives any and all defenses he may have on the grounds of competence of a
court to grant such an injunction or other equitable relief. The existence of
this right shall not preclude the applicability or exercise of any other rights
and remedies at law or in equity which the Company may have.

5. Employment Period.

(a) Duration. The Employment Period shall commence on the date
of this Agreement and shall continue until the earlier of (i) August 31, 2001,
or (ii) termination of this Agreement by the Company with "cause"; or (iii) the
Executive's resignation; or (iv) the death or Total Disability of the Executive.

(b) Payments Upon Termination.

(i) If the Executive's employment is
terminated by the Company for any reason other than "cause" (as defined in
Section 5(c)(i) hereof), at any time during the Employment Period, the Company
shall pay to the Executive, for the remainder of the Employment Period, his
Salary as if he had remained employed as through August 31, 2001. No other forms
of compensation will be payable.

(ii) If the Executive's employment is
terminated (A) by the Company for "cause", or (B) by the Executive by
resignation, then the Company shall have no further liability to the Executive,
except for the Salary which has accrued through the date of termination, which
amounts shall be paid by the Company within thirty (30) days of such
termination.

(iii) Notwithstanding any other provision of
this Section 5(b), if the Executive violates any covenant, term or condition of
this Agreement, the Company shall be entitled, in addition to any other remedies
it may have hereunder or at law or in equity, to offset the amount of any
payment otherwise due to the Executive pursuant to this Section 5(b) against any
loss or damage incurred by the Company as a result of the Executive's violation
of said covenant, term or condition.

(c) Definition of "Cause". When used in this
Agreement, the word "cause" shall mean:

(i) the Executive's material failure to
perform his employment duties hereunder after reasonable notice to the Executive
by the Chairman of the Board of the Company specifying such failure and
providing the Executive with a reasonable opportunity to cure such failure given
the context of the circumstances;

(ii) the Executive's breach of the covenants
or agreements contained in Sections 4(a) or (b) hereof, or of any
other material agreement or undertaking of the Executive;

(iii) the Executive's commission of a felony
or any crime involving moral turpitude, fraud or misrepresentation,
whether or not related to the business or property of the Company;

(iv) the Executive's gross negligence;

(v) any act of the Executive against the
Company intended to enrich the Executive in derogation of his duties
to the Company;

(vi) any willful or purposeful act or
omission taken in bad faith of the Executive having the effect of
injuring the business or business relationships of the Company; or

(vii) the Executive's material breach of his
duty of loyalty to the Company.

6. Notices. Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and if sent by
registered or certified mail to the Executive at the last address he has filed
in writing with the Company at its principal executive offices.

7. Binding Agreement; Assignment. This Agreement shall be effective
as of the date hereof and shall be binding upon and inure to the benefit of, the
parties and their respective heirs, successors, assigns, and personal
representatives, as the case may be. The Executive may not assign any rights or
duties under this Agreement. As used herein, the successors of the Company shall
include, but not be limited to, any successor by way of merger, consolidation,
sale of all or substantially all of the assets, or similar reorganization. The
Executive further acknowledges and agrees that the Company may assign all of its
rights and interests under this Agreement to a successor, and that the Executive
shall be bound and obligated to perform all of his covenants and agreements set
forth herein for the benefit of the successor as if the successor had been the
original beneficiary thereof.

8. Entire Agreement. This Agreement constitute the
entire understanding of the Executive and the Company with respect to
the subject matter hereof and supersede any and all prior
understandings written or oral. This Agreement may not be changed,
modified or discharged orally, but only by an instrument in writing
signed by the parties.

9. Enforceability. This Agreement has been duly authorized, executed
and delivered and constitutes the valid and binding obligations of the parties
hereto, enforceable in accordance with its terms. The undertakings herein shall
not be construed as any limitation upon the remedies Company might, in the
absence of this Agreement, have at law or in equity for any wrongs of the
Executive.

10. Governing Law. This Agreement shall be governed by and construed
under the laws of the Commonwealth of Virginia, without regard to its conflict
of laws provisions. The parties irrevocably consent and agree to the exclusive
jurisdiction of the Federal courts in the Commonwealth of Virginia to the extent
such jurisdiction exists and, if Federal jurisdiction does not exist, to the
exclusive jurisdiction of the courts of the Commonwealth of Virginia. Each party
waives all rights to a trial by jury in any suit, action or proceeding under
this Section.

11. Severability. Except as provided in Section 4(d) hereof, if any
one or more of the terms or provisions of this Agreement shall for any reason be
held to be invalid, illegal or unenforceable, in whole or in part, or in any
respect or in the event that any one or more of the provisions of this Agreement
operated or would prospectively operate to invalidate this Agreement, then and
in either of those events, such provision or provisions only shall be deemed
null and void and shall not affect any other provision of this Agreement and the
remaining provisions of this Agreement shall remain operative and in full force
and effect and shall in no way be affected, prejudiced or disturbed thereby.

12. Arbitration. Any controversy or claim arising out of or relating
to this contract or the breach thereof shall be settled by arbitration
administered by the American Arbitration Association under its Commercial
Arbitration Rules, and judgment on the award rendered by the arbitrator(s) may
be entered in a court selected in accordance with Section 10 hereof, provided
that the Company reserves its right under Section 4(e) hereof to seek equitable
relief in a court of competent jurisdiction in the event of a breach of the
provisions of Sections 4(a) or (b) hereof.





IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as an instrument under seal on the date first above written.


ATTEST: DYNEX CAPITAL, INC.



By:__________________________(SEAL)
Thomas H. Potts, President


WITNESS: EXECUTIVE



By:__________________________(SEAL)
William J. Moore