<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                               Amendment No. 2 to
                                  FORM 10-QSB/A


  Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of
             1934 for the quarterly period ended September 30, 2002.

                        Commission file number 000-29039

                       SECURITY ASSET CAPITAL CORPORATION
                       ----------------------------------
        (Exact Name of Small Business Issuer as Specified in Its Charter)

             NEVADA                                             95-4729666
  (State or Other Jurisdiction                                (IRS Employer
of Incorporation or Organization)                           Identification No.)

             701 B, Street, Suite 1775, San Diego, California 92101
              -----------------------------------------------------
                    (Address of Principal Executive Offices)

                                 (619) 232-9950
                                 --------------
              (Registrant's Telephone Number, Including Area Code)

            Check whether the issuer: (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports) and
(2) has been subject to such filing requirement for the past 90 days.

Yes   X           No
   -------          -------

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

            52,564,210 of common stock shares as of November 7, 2002.
                                   ----------


Transitional Small Business Disclosure Format (check one):

Yes               No    X
   ------           --------




<PAGE>


PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS

                       SECURITY ASSET CAPITAL CORPORATION
                      CONSOLIDATED CONDENSED BALANCE SHEET
                                   (UNAUDITED)
                                                                 SEPTEMBER 30,
                                                                      2002
                                                                ----------------
                                     ASSETS
CURRENT ASSETS

  CASH                                                              $   164,036
  LOAN PORTFOLIO ASSETS                                                 374,620
  RELATED PARTY RECEIVABLES, NET                                         21,789
  PREPAID EXPENSES AND SERVICES                                         452,500
                                                                    ------------

                        TOTAL CURRENT ASSETS                          1,012,945


NOTES RECEIVABLE                                                      1,200,000
FIXED ASSETS, NET                                                        55,924
PATENTS AND PATENTS PENDING                                           1,000,000
LICENSING RIGHTS                                                        251,880
CAPITALIZED SOFTWARE COSTS                                              227,000
DEBT REGISTRY DOMAIN NAMES                                              400,628
                                                                    ------------

                                                                    $ 4,148,377
                                                                    ============

                       LIABILITIES & SHAREHOLDERS' EQUITY

CURRENT LIABILITIES

  CURRENT PORTION OF NOTES PAYABLE                                  $ 1,693,028
  RELATED PARTY ADVANCES                                                196,258
  ACCOUNTS PAYABLE                                                      277,371
  ACCRUED EXPENSES                                                      475,273
                                                                    ------------
  TOTAL CURRENT LIABILITIES                                           2,641,930

NOTES PAYABLE                                                         1,624,743
DEFERRED REVENUE                                                        382,190
                                                                    ------------
                        TOTAL LIABILITIES                             4,648,863
                                                                    ------------
SHAREHOLDERS' EQUITY/(DEFICIT)
  PREFERRED STOCK, $.001 PAR VALUE, 20,000,000 AUTHORIZED,
            2,579,154 ISSUED AND OUTSTANDING, TOTAL LIQUIDATION
            PREFERENCE $5,158,308                                         5,158
  COMMON STOCK, $.001 PAR VALUE, 100,000,000 SHARES AUTHORIZED,
         51,114,210 ISSUED AND OUTSTANDING                               51,114
  ADDITIONAL PAID IN CAPITAL                                         18,411,321
  ACCUMULATED DEFICIT                                               (18,759,479)
                                                                    ------------
                                                                       (291,886)
  LESS:  TREASURY STOCK (175,000 shares)                               (208,600)
                                                                    ------------
                        TOTAL SHAREHOLDERS' EQUITY/(DEFICIT)           (500,486)
                                                                    ------------
                                                                    $ 4,148,377
                                                                    ============


        The accompanying notes are an integral part of the consolidated
                             financial statements.

                                        2


<PAGE>

                       SECURITY ASSET CAPITAL CORPORATION
                 CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

                                                     FOR THE THREE MONTHS ENDED
                                                            SEPTEMBER 30,
                                                         2002         2001
                                                    -------------  -------------
REVENUES
  PORTFOLIO                                         $    157,069   $     41,590
  RENTAL                                                      --             --
                                                    -------------  -------------
                       TOTAL REVENUES                    157,069         41,590
                                                    -------------  -------------
EXPENSES
  PORTFOLIO                                              104,713         27,434
  RENTAL                                                      --             --
  GENERAL AND ADMINISTRATIVE                           2,611,529        556,022
                                                    -------------  -------------
                       TOTAL EXPENSES                  2,716,242        583,456
                                                    -------------  -------------

LOSS FROM OPERATIONS                                  (2,559,173)      (541,866)
                                                    -------------  -------------
OTHER
  INTEREST EXPENSE                                       (45,531)      (232,010)
  OTHER                                                       --             --
                                                    -------------  -------------

                       OTHER, NET                        (45,531)      (232,010)
                                                    -------------  -------------

NET LOSS                                            $ (2,604,704)  $   (773,877)
                                                    =============  =============

NET LOSS PER SHARE                                  $      (0.06)  $      (0.03)
                                                    =============  =============

WTD AVG SHARES USED TO COMPUTE NET LOSS PER SHARE     46,064,000     23,933,000
                                                    =============  =============

               The accompanying notes are an integral part of the
                       consolidated financial statements.

                                        3


<PAGE>


                       SECURITY ASSET CAPITAL CORPORATION
                 CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

                                                      FOR THE NINE MONTHS ENDED
                                                           SEPTEMBER 30,
                                                         2002         2001
                                                    -------------  -------------
REVENUES
  PORTFOLIO                                         $    193,972   $    108,378
  RENTAL                                                      --         68,922
                                                    -------------  -------------
                       TOTAL REVENUES                    193,972        177,300
                                                    -------------  -------------
EXPENSES
  PORTFOLIO                                              125,599        163,044
  RENTAL                                                      --         38,674
  GENERAL AND ADMINISTRATIVE                           3,640,286      2,852,159
                                                    -------------  -------------
                       TOTAL EXPENSES                  3,765,885      3,053,877
                                                    -------------  -------------

LOSS FROM OPERATIONS                                  (3,571,913)    (2,876,577)
                                                    -------------  -------------
OTHER
  INTEREST EXPENSE                                      (104,765)    (1,054,093)
  OTHER                                                       --         24,115
                                                    -------------  -------------

                       OTHER, NET                       (104,765)    (1,029,938)
                                                    -------------  -------------

NET LOSS                                            $ (3,676,678)  $ (3,864,967)
                                                    =============  =============

NET LOSS PER SHARE                                  $      (0.11)  $      (0.20)
                                                    =============  =============

WTD AVG SHARES USED TO COMPUTE NET LOSS PER SHARE     34,468,000     19,334,000
                                                    =============  =============

               The accompanying notes are an integral part of the
                       consolidated financial statements.

                                        4


<PAGE>

<TABLE>

                                                SECURITY ASSET CAPITAL CORPORATION
                                                         AND SUBSIDIARIES
                                     CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY/(DEFICIT)
                                           For the Nine Months Ended September 30, 2002
                                                            (Unaudited)
<CAPTION>

                                            Preferred Stock             Common Stock                 Treasury Stock
                                   ----------------------------  ----------------------------  ----------------------------
                                       Stock         Amount         Stock          Amount         Stock           Amount
                                   -------------  -------------  -------------  -------------  -------------  -------------
<S>                                   <C>         <C>              <C>          <C>                 <C>       <C>
Balance, December 31, 2001            2,579,154   $      5,158     28,196,710   $     28,197        175,000   $   (208,600)
                                   -------------  -------------  -------------  -------------  -------------  -------------
Issuances of common stock:
   Consulting services:
   @$0.07 to $0.09 February 2002             --             --      3,300,000          3,300             --             --
   @$0.08 to $0.09 March 2002                --             --        350,000            350             --             --
Net loss for three months ended
   March 31, 2002                            --             --             --             --             --             --
                                   -------------  -------------  -------------  -------------  -------------  -------------
Balance, March 31, 2002               2,579,154          5,158     31,846,710         31,847        175,000       (208,600)

Issuances of common stock:
   Consulting services:
   @$0.09 April 2002                         --             --      1,000,000          1,000             --             --
   @$0.065 May 2002                          --             --      1,685,000          1,685             --             --
   @$0.14 June 2002                          --             --        645,000            645             --             --

Issuance of options/warrants                 --             --             --             --             --             --

Net loss for three months
   ended June 30, 2002                       --             --             --             --             --             --
                                   -------------  -------------  -------------  -------------  -------------  -------------
Balance, June 30, 2002                2,579,154          5,158     35,176,710         35,177        175,000       (208,600)

Issuances of common stock:
   Cash                                 160,000            160          4,840          5,000
   Conversion of debt                   100,000            100          9,900         10,000
   Acquisition of subsidiary,
     Universal View                          --             --        770,000            770             --             --
   Consulting services:
   @$0.10 July 2002                          --             --     11,740,000         11,740             --             --
   @$0.055 August 2002                       --             --      2,087,500          2,087             --             --
   @$0.055 September 2002                    --             --      1,080,000          1,080             --             --

Issuance of options/warrants
   for services                              --             --             --             --             --             --
Issuance of warrants for
   licensing rights                     251,880        251,880

Net loss for three months ended
   September 30, 2002                        --             --             --             --             --             --
                                   -------------  -------------  -------------  -------------  -------------  -------------
Balance, September 30, 2002           2,579,154   $      5,158     51,114,210   $     51,114        175,000   $   (208,600)
                                   =============  =============  =============  =============  =============  =============


continued below:

                                   Additional
                                    Paid-In      Accumulated
                                    Capital         Deficit           Total
                                  -------------  -------------   -------------
Balance, December 31, 2001        $ 16,069,116   $(15,082,801)   $    811,070
                                  -------------  -------------   -------------
Issuances of common stock:
   Consulting services:
   @$0.07 to $0.09 February 2002       276,200             --         279,500
   @$0.08 to $0.09 March 2002           28,650             --          29,000
Net loss for three months ended
   March 31, 2002                           --       (527,953)       (527,953)
                                  -------------  -------------   -------------
Balance, March 31, 2002             16,373,966    (15,610,754)        591,617

Issuances of common stock:
   Consulting services:
   @$0.09 April 2002                    89,000             --          90,000
   @$0.065 May 2002                    107,840             --         109,525
   @$0.14 June 2002                     89,655             --          90,300

Issuance of options/warrants            25,980             --          25,980

Net loss for three months
   ended June 30, 2002                      --       (544,021)       (544,021)
                                  -------------  -------------   -------------
Balance, June 30, 2002              16,686,441    (16,154,775)        363,401

Issuances of common stock:
   Cash
   Conversion of debt
   Acquisition of subsidiary,
     Universal View                     41,580             --          42,350
   Consulting services:
   @$0.10 July 2002                  1,162,260             --       1,174,000
   @$0.055 August 2002                 112,726             --         114,813
   @$0.055 September 2002               58,320             --          59,400

Issuance of options/warrants
   for services                         83,374             --          83,374
Issuance of warrants for
   licensing rights

Net loss for three months ended
   September 30, 2002                       --     (2,604,704)     (2,604,704)
                                  -------------  -------------   -------------
Balance, September 30, 2002       $ 18,411,321   $(18,759,479)   $   (500,486)
                                  =============  =============   =============





               The accompanying notes are an integral part of the
                       consolidated financial statements.


                                        5
</TABLE>


<PAGE>


                       SECURITY ASSET CAPITAL CORPORATION
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)


                                                      FOR THE NINE MONTHS ENDED
                                                            SEPTEMBER 30,
                                                         2002          2001
                                                    -------------  -------------
CASH FLOWS FROM OPERATING ACTIVITIES:

NET CASH FLOWS FROM OPERATING ACTIVITIES            $   (117,464)  $   (324,970)


CASH FLOWS FROM INVESTING ACTIVITIES:

   ACQUISITION OF THE DEBT REGISTRY                     (227,000)       (42,075)


CASH FLOW FROM FINANCING ACTIVITIES:

   NET PROCEEDS FROM BORROWINGS - NOTES PAYABLE          508,500        363,602
                                                    -------------  -------------

              NET INCREASE/(DECREASE) IN CASH            164,036         (3,443)

              CASH AT THE BEGINNING OF THE PERIOD             --          3,443
                                                    -------------  -------------

              CASH AT THE END OF THE PERIOD         $    164,036   $         --
                                                    =============  =============


               The accompanying notes are an integral part of the
                       consolidated financial statements.

                                        6



<PAGE>


NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
----------------------------------------------------

BASIS OF PRESENTATION
---------------------
These condensed consolidated financial statements of Security Asset Capital
Corporation and subsidiaries (the Company) do not include all of the information
required by accounting principles generally accepted in the United States of
America for complete financial statements and should be read in conjunction with
the financial statements included in the Company's Form 10KSB for 2001. In the
opinion of management, the financial information set forth in the accompanying
condensed financial statements reflects all adjustments necessary for a fair
statement of the periods reported and all such adjustments were of a normal
recurring nature. Interim results are not necessarily indicative of results for
a full year.

PRINCIPLES OF CONSOLIDATION
---------------------------
The accompanying financial statements consolidate the accounts of Security Asset
Capital Corporation ("SACC") and its wholly owned subsidiaries, Security Asset
Management, Inc., Security Asset Properties, Inc. ("SAP") for the first quarter
of 2001, Broadband Technologies, Inc., Universal View Corporation, the
DebtTrader.com and The Debt Registry. All significant intercompany accounts and
transactions have been eliminated in consolidation.

USE OF ESTIMATES
----------------
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and reported amounts of revenues and expenses during
the reporting period. Actual result could differ from those estimates.

LOAN PORTFOLIO ASSETS AND REVENUE RECOGNITION
---------------------------------------------
Loan Portfolio Assets represent liquidating loan portfolios of delinquent
accounts which have been purchased by SACC for resale and collection and are
stated at the lower of cost or current value. The cost of these Assets is the
actual amount spent for the purchase, including related brokerage commissions,
if any. Management presently estimates that Loan Portfolio Assets through sale
or collection will realize gross collections in excess of the carrying value of
the Assets. The cost of the Asset is written off by a percentage of cash
collections on a portfolio-by- portfolio basis. The Company, therefore, writes
off an amount less than one dollar of cost of Portfolio Assets for every dollar
in gross sales or collection. Certain Loan Portfolio Assets are sold in part or
in whole by the Company. Gains and losses from such sales are recorded when the
Assets are sold. The Company considers a sale to have taken place when there has
been a transfer of The Loan Portfolio Assets and where the Company surrenders
control over the Loan Portfolio Assets to the extent the consideration other
then beneficial interests in the transferred Loan Portfolio Assets is received
in exchange for the Loan Portfolio Assets.

LICENSING RIGHTS
----------------
The Company entered into a licensing agreement for the purpose of creating an
automated system to be used in conjunction with other systems either developed
or under development by the Company solely for the purposes of the settlement
and/or collection of consumer debts. The license shall be in force for a period
of one year from the date of the agreement and the Company has the right to
extend the license on a year to year basis for a period of ten years to the
extent that performance measures and covenants are maintained. As consideration
for the license the Company issued warrants to purchase up to 3,000,000 shares
of its common stock valued at $251,880. The Company anticipates initial revenues
from this patented settlement and collection system by the second quarter of
2003, at which time the licensing rights will begin being amortized. There can
be no assurance that this product will be successfully developed or when
developed profitable to the company.

                                        7


<PAGE>


CONVERSION OF DEBT AND SUBSEQUENT EVENT
---------------------------------------
During the third quarter of the Company issued a total of 100,000 shares of
common stock in exchange for a $10,000 note payable.

Subsequent to September 30, 2002, the Company initiated a conversion of
unsecured debt up to the amount of $3.0 million into shares of $2.00 Series A
Convertible Redeemable Preferred Stock. The Company has authorized 20,000,000
shares, $0.001 par value of Preferred Stock which has a $2.00 per share
liquidation preference. The Preferred Shares issued in conversion are valued at
$2.00 per share. The converting shareholders have the right to convert their
Preferred Shares to common stock at $2.00 per share anytime between September
30, 2002 and August 30, 2003. The preferred shares will be automatically
converted to common stock upon the closing of a public offering with a value of
at least $20,000,000.

NET LOSS PER SHARE
------------------
Basic net loss per share is computed by dividing net loss by the weighted
average number of common shares outstanding during the reported periods. Diluted
net loss per share reflects the potential dilution that could occur if stock
options and other commitments to issue common stock were exercised. Outstanding
stock options during the periods presented were anti-dilutive and have been
excluded from the weighted average share computation.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS

The following discussion and analysis should be read in conjunction with the
selected historical financial data, financial statements and notes thereto and
the other historical financial information of Security Asset Capital Corporation
contained elsewhere in this Form 10-QSB. The statements contained in this Form
10-QSB that are not historical are forward looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Exchange Act of 1934, including statements regarding Security Asset Capital
Corporation's expectations, intentions, beliefs or strategies regarding the
future. Forward-looking statements include Security Asset Capital Corporation's
statements regarding liquidity, anticipated cash needs and availability and
anticipated expense levels. All forward-looking statements included in this Form
10-QSB are based on information available to Security Asset Capital Corporation
on the date hereof, and Security Asset Capital Corporation assumes no obligation
to update any such forward-looking statement. It is important to note that
Security Asset Capital Corporation's actual results could differ materially from
those in such forward-looking statements.

OVERVIEW

Security Asset Capital Corporation (the "Company") was founded on September 22,
1993 and has operated within the asset liquidation industry. Its historic
primary operations through its wholly owned subsidiary, Security Asset
Management, Inc., a California corporation, have been the management of debt
receivable portfolios, which includes buying and selling of portfolios on a
wholesale and retail level. The Company is in the process of developing the
operations of The Debt Registry, Inc., a Nevada corporation that is a wholly
owned subsidiary of the Company that is developing a database which is an asset
ownership registration and tracking system for the asset liquidation and
purchasing industry as well as for financial institutions. The Company is also
in the process of developing an online system for collecting and resolving
consumer debt through a mechanized payment and bidding system. This unique,
patented process has been licensed exclusively to Security Asset Capital
Corporation for the consumer debt marketplace. In addition, Broadband
Technologies, Inc., a Nevada corporation that is a wholly owned subsidiary of
the Company holds several patents in connection with full screen, on demand
video to be delivered via the Internet, which the Company is in the process of
developing.

The Company's revenues in 2002 have resulted from the collections on and sales
of debt portfolios. The Company is anticipating a shift in its operations
whereby a majority of its future revenue will be generated through its account
collection and resolution tool, The Debt Registry and Broadband Technologies.
Although the Company cannot guarantee, it expects to generate revenue through
its account collection and resolution tool and The Debt Registry by the second
quarter of 2003 and through Broadband Technologies by 2004.

                                        8


<PAGE>


RESULTS OF OPERATIONS FOR EACH OF THE THREE MONTHS ENDED SEPTEMBER 30, 2002 AND
2001

REVENUES
Revenues for the three months ended September 30, 2002 were derived completely
from collections on and sales of loan portfolio assets, which amounted to
$157,069 as compared to $41,590 for the same period during 2001, which revenue
was derived from the management of the Company's debt portfolio. The increase in
revenues resulted from management's heightened effort to market the Loan
Portfolio Assets to the debt buying industry during the third quarter of 2002.
Although our revenues have increased, the slowdown of the United States economy
has resulted in an increase in defaults in connection with the debt receivables
managed by Security Management Asset, Inc., the Company's wholly owned
subsidiary.

NET LOSS
Net loss for the three months ended September 30, 2002 was $2,604,704 as
compared to $773,877 for the same period during 2001. This increase is primarily
due to costs associated with the issuance of common stock for services, a
$300,000 charge to record Loan Portfolio Assets at their net realizable value
and a $1,052,500 impairment charge on long-lived assets, offset by the decrease
in interest expense resulting from the conversion of approximately $5.2 million
of notes payable to preferred stock at the end of 2001.

RESULTS OF OPERATIONS FOR EACH OF THE NINE MONTHS ENDED SEPTEMBER 30, 2002 AND
2001

REVENUES
Revenues for the nine months ended September 30, 2002 were derived completely
from collections on and sales of loan portfolio assets, which amounted to
$193,972 as compared to $108,378 for the same period in 2001, which revenue was
derived from the management of the Company's debt portfolios. The Company also
earned rental revenues in the amount of $68,922 during the nine months ended
September 30, 2001 from its wholly owned subsidiary, Securities Asset
Properties, Inc., which was sold on March 28, 2001. The increase in revenues
resulted from management's heightened effort to market the Loan Portfolio Assets
to the debt buying industry during the third quarter of 2002. Although our
revenues have increased, the slowdown of the United States economy has resulted
in an increase in defaults in connection with the debt receivables managed by
Security Management Asset, Inc., the Company's wholly owned subsidiary.

NET LOSS
Net loss for the nine months ended September 30, 2002 was $3,676,678 as compared
to $3,864,967 for the same period during 2001. This decrease is primarily due to
the lower costs associated with the issuance of common stock for services and
the decrease in interest expense resulting from the conversion of approximately
$5.2 million of notes payable to preferred stock at the end of 2001 offset by a
$300,000 charge to record Loan Portfolio Assets at their net realizable value
and a $1,052,500 impairment charge on long-lived assets.


LIQUIDITY AND CAPITAL RESOURCES
The Company has only a limited operating history and revenues and has had net
losses from operations. The Company's continued existence is dependent upon its
ability to resolve its liquidity problems, principally by the continued sale of
its Loan Portfolio Assets and by obtaining additional debt financing and equity
capital until such time the Company becomes profitable. Cash on hand as of
September 30, 2002 resulted from the sale of a loan portfolio and unsecured,
short-term borrowings. The lack of financial resources and liquidity raises
substantial doubt about its ability to continue as a going concern. The Company
plans to continue funding its operations and proceeds from the further sale of
its debt receivables portfolio and additional debt and equity capital offerings.
There is no assurance that management will be successful in these endeavors.

                                        9



<PAGE>


ITEM 3.  CONTROLS AND PROCEDURES

As of September 30, 2002, an evaluation was performed under the supervision and
with the participation of the Company's management, including the Principal
Executive Officer and the Principal Accounting Officer, of the effectiveness of
the design and operation of the Company's disclosure controls and procedures.
Based on that evaluation, the Company's management, including the Principal
Executive Officer and the Principal Accounting Officer, concluded that the
Company's disclosure controls and procedures were effective as of September 30,
2002. There have been no significant changes in the Company's internal controls
or in other factors that could significantly affect internal controls subsequent
to September 30, 2002.


PART II OTHER INFORMATION

 Item 1. Legal proceedings - None

 Item 2. Changes in Securities - None

 Item 3. Defaults Upon Senior Securities - None

 Item 4. Submission of Matters to a Vote of Security Holders - None

 Item 5. Other Information - None

 Item 6. Exhibits and Reports of Form 8K

(a)      Exhibit Description

         10.1     Licensing Agreement entered between Security Asset Capital
                  Corporation and Charles S. Broufman dated June 26, 2002. (to
                  be filed supplementally)

         10.2     Licensing Agreement entered between Security Asset Capital
                  Corporation and James D. Burchetta dated June 26, 2002. (to be
                  filed supplementally)


         99.1     Certification of the Chief Executive Officer and the Chief
                  Financial Officer of Security Asset Capital Corporation
                  pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002.

(b)      Reports on Form 8-K

         None.

                                   SIGNATURES

            Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                  Security Asset Capital Corporation

DATED:  November 19, 2002         /s/ DAVID R. WALTON
                                  ------------------------------------------
                                  David R. Walton, Chief Executive Officer

                                       10


<PAGE>


                                  CERTIFICATION

          I, David Walton, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of Security Asset
Capital Corporation;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

         a) designed such disclosure controls and procedures to ensure that
         material information relating to the registrant, including its
         consolidated subsidiaries, is made known to us by others within those
         entities, particularly during the period in which this quarterly report
         is being prepared;

         b) evaluated the effectiveness of the registrant's disclosure controls
         and procedures as of a date within 90 days prior to the filing date of
         this quarterly report (the "Evaluation Date"); and

         c) presented in this quarterly report our conclusions about the
         effectiveness of the disclosure controls and procedures based on our
         evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):

         a) all significant deficiencies in the design or operation of internal
         controls which could adversely affect the registrant's ability to
         record, process, summarize and report financial data and have
         identified for the registrant's auditors any material weaknesses in
         internal controls; and

         b) any fraud, whether or not material, that involves management or
         other employees who have a significant role in the registrant's
         internal controls; and

6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

November 19, 2002

/s/ David Walton
--------------------------
Name: David Walton
Title: CEO and CFO