September __, 1998

Dear Investor:

     We are asking you to consider and vote on a proposal to merge the 
America First Tax Exempt Mortgage Fund into a new partnership, America First 
Tax Exempt Investors, L.P. The Tax Exempt Mortgage Fund is performing very 
satisfactorily; however, the current structure does not allow the Fund to 
take advantage of existing opportunities to increase cash flow. The General 
Partner has proposed the merger in order to transfer the assets of the 
existing partnership to the new fund which will have expanded authority to 
restructure its current assets so that it may acquire additional tax-exempt 
mortgage bonds secured by multifamily real estate. The General Partner has 
proposed the transaction in an effort to increase the amount of tax-exempt 
interest available for distribution to investors, reduce risk through 
increased asset diversification and achieve improved economies of scale.

     Because you are an investor of record as of September 25, 1998, you are 
receiving the following documents;

- --  Consent Solicitation Statement/Prospectus

- --  Consent Form, which must be completed and returned

- --  Question and Answer brochure

     The merger proposal is described in detail in the accompanying Consent 
Solicitation Statement Prospectus. We realize this is a sizable document, but 
we urge you to read it carefully. After you have reviewed the enclosed 
materials, we urge you to vote "FOR" the proposal by completing, signing and 
dating the enclosed Consent Form and returning it by November 5, 1998, in the 
enclosed, postage-paid, envelope.

     If you have further questions regarding the proposal, please call our 
Investor Services Department at 1-800-239-8787, Option 2.


Michael Yanney

Chairman