<PAGE>   1

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q

(Mark One)
[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
               THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 1999

                                       OR

[ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
               THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                        to
                               -----------------------  ------------------------
Commission file number    000-23887

                           ROCK FINANCIAL CORPORATION
             (Exact name of registrant as specified in its charter)

           MICHIGAN                                            38-2603955
(State or other jurisdiction of                             (I.R.S. Employer
incorporation or organization)                             Identification No.)

                       30600 TELEGRAPH ROAD, FOURTH FLOOR
                             BINGHAM FARMS, MICHIGAN
                                      48025
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (248) 540-8000
              (Registrant's telephone number, including area code)


   ---------------------------------------------------------------------------
         (Former name, former address and former fiscal year, if changed
                               since last report)

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]

         Number of common shares outstanding as of November 11, 1999: 14,858,554

================================================================================
<PAGE>   2


                           ROCK FINANCIAL CORPORATION

                                Table of Contents

<TABLE>
<CAPTION>
                                                                                                        Page
                                                                                                        Number
                                                                                                        ------
<S>                                                                                                       <C>
PART I--FINANCIAL INFORMATION............................................................................  3
     ITEM 1. FINANCIAL STATEMENTS........................................................................  3
          CONSOLIDATED BALANCE SHEETS....................................................................  3
          CONSOLIDATED STATEMENTS OF INCOME..............................................................  4
          CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY.................................................  5
          CONSOLIDATED STATEMENTS OF CASH FLOWS..........................................................  6
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.....................................................  7
     ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS.................................................. 14
     ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
          MARKET RISK.................................................................................... 40


PART II--OTHER INFORMATION............................................................................... 42
     ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS.................................................. 42
     ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K........................................................... 42


SIGNATURES............................................................................................... 45
</TABLE>



<PAGE>   3

                          PART I--FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                           ROCK FINANCIAL CORPORATION
                           CONSOLIDATED BALANCE SHEETS
                    DECEMBER 31, 1998 AND SEPTEMBER 30, 1999

<TABLE>
<CAPTION>
                                                                             December 31,    September 30,
                                                                                 1998            1999
                                                                           --------------    -------------
ASSETS                                                                                        (Unaudited)
<S>                                                                        <C>               <C>
Cash and cash equivalents...............................................   $   30,081,524    $  37,091,876
Mortgage loans held for sale............................................      155,631,112       41,277,617
Mortgage loans held for investment (net of allowance for
   losses of $634,851 and $362,191 at December 31,
   1998 and September 30, 1999, respectively)...........................        3,766,171          361,009
Real estate owned.......................................................           49,989
Shareholders' advances..................................................          994,372
Property and equipment (net of accumulated depreciation of
   $5,400,480 and $5,405,026 at December 31, 1998 and
   September 30, 1999, respectively)....................................       10,775,733        8,640,297
Deferred income taxes...................................................        1,945,000        4,931,699
Prepaid and federal income tax receivable...............................                         5,808,751
Other assets............................................................        1,193,552        1,140,692
                                                                           --------------    -------------

Total assets............................................................   $  204,437,453    $  99,251,941
                                                                           ==============    =============

LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
   Warehouse line of credit.............................................   $   98,008,105    $  21,235,911
   Reverse repurchase agreement.........................................       11,521,065
   Drafts payable.......................................................       44,021,087       19,252,599
   Accounts payable.....................................................        4,680,275        3,244,237
   Accrued expenses and other liabilities...............................        8,171,773        6,111,441
                                                                           --------------    -------------
      Total liabilities.................................................      166,402,305       49,844,188
                                                                           --------------    -------------

Minority interest in subsidiary.........................................                           155,939

Shareholders' equity:
   Common shares, $.01 par value. Authorized 50,000,000
     shares; issued and outstanding 13,590,500 shares
     and 14,853,454 shares at December 31, 1998 and
     September 30, 1999, respectively...................................          135,905          148,535
   Additional paid-in capital...........................................       26,297,782       40,226,050
   Retained earnings....................................................       11,601,461        8,877,229
                                                                           --------------    -------------
     Total shareholders' equity.........................................       38,035,148       49,251,814
                                                                           --------------    -------------

Total liabilities and shareholders' equity..............................   $  204,437,453    $  99,251,941
                                                                           ==============    =============
</TABLE>


                                                                    Page 3 of 45
<PAGE>   4

                           ROCK FINANCIAL CORPORATION
                        CONSOLIDATED STATEMENTS OF INCOME
         THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1999
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                For the Three-Month                  For the Nine-Month
                                                            Periods Ended September 30,          Periods Ended September 30,
                                                         ----------------------------------    -------------------------------
                                                             1998               1999               1998                1999
                                                         -------------    -----------------    --------------    -------------
<S>                                                      <C>              <C>                  <C>               <C>
Revenue:
    Interest income.....................................  $ 2,964,168         $  1,608,076       $ 9,191,880      $ 6,520,908
    Interest expense....................................    1,481,819              369,112         5,101,646        2,401,370
                                                         ------------     ----------------     -------------     ------------
         Net interest margin............................    1,482,349            1,238,964         4,090,234        4,119,538
    Provision for credit losses.........................      139,863              399,527           389,573        1,083,086
                                                         ------------     ----------------     -------------     ------------
         Net interest margin after provision for credit
            losses.....................................     1,342,486              839,437         3,700,661        3,036,452
    Loan fees and gains on sale of mortgages............   21,761,051           11,420,439        60,400,881       45,955,456
    Other income........................................          614                1,699            18,349            4,324
                                                         -------------    ----------------     -------------     ------------
                                                           23,104,151           12,261,575        64,119,891       48,996,232
                                                         ------------     ----------------     -------------     ------------
Expenses:
    Salaries, commissions and employee  benefits........   10,085,776            8,357,223        28,282,016       28,945,819
    General and administrative expenses.................    3,452,014            2,996,673         9,549,769       10,014,187
    Marketing expenses..................................    3,396,356            2,837,290         9,856,834        7,432,882
    Depreciation and amortization.......................      541,654              513,810         1,593,704        1,773,871
    Loss on branch closings.............................                         3,500,000                          3,500,000
    Costs incurred or accrued in connection with the
      relocation of corporate headquarters..............                           835,919                            835,919
                                                         ------------     ----------------     -------------     ------------
                                                           17,475,800           19,040,915        49,282,323       52,502,678
                                                         ------------     ----------------     -------------     ------------
    Income  (loss) before income taxes and minority
      interest..........................................    5,628,351           (6,779,340)       14,837,568       (3,506,446)
    Minority interest in loss of subsidiary.............                            59,163                            144,061
    Income tax (expense) benefit........................   (1,501,016)           2,419,264        (2,624,540)       1,210,264

    Income tax benefit due to conversion of "S"
      Corp..............................................                                             950,939
                                                         ------------     ----------------     -------------     ------------
       Net income (loss)................................  $ 4,127,335         $ (4,300,913)      $13,163,967      $(2,152,121)
                                                         ============     ================     =============     ============
Pro forma information (note 5):
    Income before income taxes..........................  $ 5,628,351                            $14,837,568
    Provision for pro forma income taxes................    1,969,923                              5,193,149
                                                         ------------                          -------------
    Pro forma net income................................  $ 3,658,428                            $ 9,644,419
                                                         ============                          =============
Pro forma earnings (loss) per share/earnings (loss) per
        share (1999):
    Basic...............................................  $      0.26         $      (0.29)      $      0.70      $     (0.15)
                                                         ============     ================     =============     ============
    Diluted.............................................  $      0.25         $      (0.29)      $      0.66      $     (0.15)
                                                         ============     ================     =============     ============
Dividends declared per share............................  $      0.02                   --       $      0.04      $      0.04
                                                         ============     ================     =============     ============
Pro forma weighted average number of
shares outstanding/Weighted average number of shares
outstanding (1999):
    Basic...............................................   13,829,500           14,829,436        13,829,500       14,441,750
                                                         ============     ================     =============     ============
    Diluted.............................................   14,516,904           14,829,436        14,520,594       14,441,750
                                                         ============     ================     =============     ============
</TABLE>



                                                                   Page 4 for 45

<PAGE>   5

                           ROCK FINANCIAL CORPORATION
                 CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                      NINE MONTHS ENDED SEPTEMBER 30, 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                  ADDITIONAL                    TOTAL
                                                   COMMON          PAID-IN       RETAINED    SHAREHOLDERS'
                                                   SHARES          CAPITAL       EARNINGS       EQUITY
                                                   ------          -------       --------       ------
<S>                                              <C>            <C>             <C>           <C>
Balance January 1, 1999 ......................   $   135,905    $ 26,297,782    $11,601,461   $38,035,148
Net income (loss) ............................                                   (2,152,121)   (2,152,121)
Cash dividends ($.04 per share) ..............                                     (572,111)     (572,111)
Stock options exercised ......................        12,630       7,594,867                    7,607,497
Tax benefit from the exercise of non-qualified
       stock options .........................                     6,333,401                    6,333,401
                                                 -----------    ------------    -----------   -----------
Balance September 30, 1999 ...................   $   148,535    $ 40,226,050    $ 8,877,229   $49,251,814
                                                 ===========    ============    ===========   ===========
</TABLE>


                                                                    Page 5 of 45
<PAGE>   6

                           ROCK FINANCIAL CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                  NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1999
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                          For the Nine-Month
                                                                       Periods Ended September 30,
                                                                       ---------------------------
                                                                       1998               1999
                                                                       ----               ----
<S>                                                              <C>                <C>
Cash flows from operating activities:
     Net income (loss) .......................................   $    13,163,967    $    (2,152,121)
                                                                 ---------------    ---------------
     Adjustments to reconcile net income (loss) to net cash
         provided by operating activities:
         Minority interest in loss of subsidiary .............                             (144,061)
         Depreciation and amortization .......................         1,593,704          1,773,871
         Provision for credit losses .........................           389,573          1,083,086
         Deferred income taxes ...............................        (1,684,088)         1,512,501
         Mortgage loans held for sale - originations .........    (1,541,037,088)    (1,515,807,934)
         Mortgage loans held for sale - sales ................     1,558,158,378      1,630,161,429
         Change in assets and liabilities:
              Prepaid and federal income tax receivable ......                           (3,974,550)
              Other assets ...................................          (128,069)            52,861
              Drafts payable .................................        23,395,698        (24,768,488)
              Accounts payable ...............................         1,448,278         (1,436,038)
              Accrued expenses and other liabilities .........         7,044,646         (1,187,005)
                                                                 ---------------    ---------------
                  Total adjustments ..........................        49,181,032         87,265,672
                                                                 ---------------    ---------------
                  Net cash provided by operating activities ..        62,344,999         85,113,551
                                                                 ---------------    ---------------
Cash flows from investing activities:
     Net (increase) decrease in real estate owned and loans
         held for investment .................................        (1,281,614)         2,372,065
     Purchase of property and equipment ......................        (4,570,127)          (511,763)
     Repayments of shareholders' advances ....................         1,626,519            994,372
                                                                 ---------------    ---------------
         Net cash provided by (used in) investing activities..        (4,225,222)         2,854,674
                                                                 ---------------    ---------------
Cash flows from financing activities:
     Net payments under warehouse line of credit .............       (25,743,423)       (76,772,194)
     Net payments under reverse repurchase agreement .........       (15,410,507)       (11,521,065)
     Net payments under notes payable ........................        (1,944,445)
     Investment in subsidiary by minority interest ...........                              300,000
     Net proceeds from initial public offering ...............        31,045,350
     Proceeds from exercised options .........................         1,904,400          7,607,497
     Cash dividends ..........................................          (553,280)          (572,111)
     S Corporation distribution ..............................       (24,980,500)
                                                                 ---------------    ---------------
Net cash used in financing activities ........................       (35,682,405)       (80,957,873)
                                                                 ---------------    ---------------
Net increase in cash and cash equivalents ....................        22,437,372          7,010,352
Cash and cash equivalents, beginning of period ...............        11,946,992         30,081,524
                                                                 ---------------    ---------------
Cash and cash equivalents, end of period .....................   $    34,384,364    $    37,091,876
                                                                 ===============    ===============

Supplemental disclosure of cash flow information:
     Cash paid during the period for interest ................   $     5,059,170    $     3,049,277
                                                                 ===============    ===============
     Cash paid during the period for federal income tax ......   $             0    $     1,156,000
                                                                 ===============    ===============
     Transfers of loans from held for sale to held
         for investment ......................................   $       989,338    $     1,420,641
                                                                 ===============    ===============
     Transfers of loans from held for investment to
         real estate owned ...................................   $        45,880    $       447,124
                                                                 ===============    ===============
</TABLE>


                                                                    Page 6 of 45
<PAGE>   7

                           ROCK FINANCIAL CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.   FINANCIAL STATEMENT PRESENTATION:

          The accompanying unaudited interim financial statements of Rock
     Financial Corporation (the "Company") and its subsidiary have been prepared
     pursuant to the rules and regulations of the Securities and Exchange
     Commission. Accordingly, such financial statements do not include all of
     the information and footnotes normally included in the Company's annual
     financial statements prepared in accordance with generally accepted
     accounting principles, although the Company believes that the disclosures
     are adequate to make the information presented not misleading.

          The accompanying unaudited interim financial statements reflect all
     adjustments which are, in the opinion of management, necessary to present a
     fair statement of the results of operations for the interim periods
     presented. All such adjustments are of a normal recurring nature, except
     those not material to the Company's financial condition or results of
     operations. All significant intercompany accounts and transactions have
     been eliminated in consolidation. Operating results for the three- and
     nine-month periods ended September 30, 1999 are not necessarily indicative
     of the results that may be expected for the year ending December 31, 1999.
     The unaudited interim financial statements should be read in conjunction
     with the audited financial statements and footnotes to such financial
     statements for the year ended December 31, 1998 included in the Company's
     Annual Report on Form 10-K (file no. 000-23887) for the year ended December
     31, 1998.

2.   MORTGAGE LOANS HELD FOR SALE AND HELD FOR INVESTMENT:

          The following summarizes mortgage loans held for sale by type at
     December 31, 1998 and September 30, 1999:


<TABLE>
<CAPTION>
                                                                                    December 31,        September 30,
                                                                                        1998                1999
                                                                                 ----------------      --------------
<S>                                                                              <C>                   <C>
     Conventional loans held for sale..............................              $    123,240,133      $  31,634,797
     Sub-prime loans held for sale.................................                    30,542,410          4,607,080
     Government-insured loans held for sale........................                       941,966          4,890,885
     High LTV loans held for sale..................................                       671,748
                                                                                 ----------------      -------------
                                                                                      155,396,257         41,132,762
     Net deferred loan origination costs...........................                       234,855            144,855
                                                                                 ----------------      -------------
         Mortgage loans held for sale..............................              $    155,631,112      $  41,277,617
                                                                                   ================    =============
</TABLE>

          Netted against mortgage loans held for investment at December 31, 1998
     and September 30, 1999 is an allowance for credit losses of $634,851 and
     $362,191 respectively. The activity for the nine months ended September 30,
     1999 includes a provision of $1,083,086 offset by charge-offs of
     $1,355,746. The activity for the year ended December 31, 1998 includes a
     provision of $567,738 offset by charge-offs of $202,888.




                                                                    Page 7 of 45
<PAGE>   8

          As of December 31, 1998 and September 30, 1999, there were no loans
     held for sale that were greater than 90 days past due. As of December 31,
     1998 and September 30, 1999, there were approximately $753,000 and
     $361,000, respectively, of loans held for investment that were greater than
     90 days past due, the vast majority of which were sub-prime loans.

3.   RELATED PARTY TRANSACTIONS:

          The Company's short-term advances to certain shareholders were repaid
     in full on March 31, 1999.

4.   EARNINGS PER SHARE:

          Basic earnings per share are computed based on the weighted average
     number of common shares outstanding during the period. Diluted earnings per
     share are computed based on the weighted average number of common shares
     and common share equivalents during the period. Basic and diluted loss per
     share have been calculated by dividing the net loss by the weighted average
     number of common shares outstanding during each period presented. Stock
     options have been excluded from the calculation of diluted loss per share
     for the earnings per share calculation for the periods ended September 30,
     1999, as their effect would have been antidilutive.

5.   UNAUDITED PRO FORMA FINANCIAL INFORMATION:

          The pro forma financial information has been presented to show what
     the significant effects on the historical results of operations might have
     been had the Company not been treated as an S corporation for income tax
     purposes as of the beginning of the earliest period presented. The
     presentation of pro forma net income represents the historical results of
     operations adjusted to recognize federal and state income taxes as if the
     Company had been taxed as a C corporation rather than an S corporation for
     all of the periods presented, using a pro forma combined federal and state
     income tax rate of approximately 35.0%.

          Pro forma basic earnings per share for the period ended September 30,
     1998 were computed by dividing pro forma net income by the 13,829,500
     average shares assumed to be outstanding, including the 3,499,500 shares
     sold by the Company in its initial public offering and the 330,000 shares
     sold by certain existing shareholders in its initial public offering (after
     exercising options to purchase those shares from the Company). Pro forma
     diluted earnings per share for the period ended September 30, 1998 were
     computed by dividing pro forma net income by the 14,520,594 (for the
     nine-month period) and 14,516,904 (for the three-month period) average
     shares assumed to be outstanding, including the 3,499,500 shares sold by
     the Company in its initial public offering and the 330,000 shares sold by
     certain existing shareholders in its initial public offering (after
     exercising options to purchase those shares from the Company) as well as
     the number of common stock equivalent shares assumed to be outstanding upon
     exercise of the Company's stock options existing as of September 30, 1998,
     using the treasury stock method and the $9.86 per share closing market
     price of the Company's common shares as of September 30, 1998, as reported
     by The Nasdaq Stock Market.

                                                                    Page 8 of 45
<PAGE>   9

6.   SEGMENT REPORTING:

          When the Company adopted SFAS No. 131 in 1998 it was comprised of
     three major operating divisions based on the major products it offered in
     1998 and in the first quarter of 1999. As of April 1, 1999, the Company
     changed the way it manages its business from divisions based on products to
     divisions based on the method of distribution of its loan products: the
     Web/Call Center division, the Branch network and the Strategic Alliance
     Program. The following table shows the contribution to revenues and
     expenses and the loan closings of each of the Company's distribution
     channels for the three- and nine-month periods ended September 30, 1998 and
     September 30, 1999 (the comparative prior year information has been
     restated to conform to the current segmentation of the Company's business).
     Corporate overhead is included in Other. Also, reflected in Other are the
     costs associated with the branch closings and relocation of the corporate
     headquarters of $3.5 million and $0.8 million, respectively. Other than
     loans, the Company's assets are not specifically allocated to its three
     distribution channels and therefore, not used by management for operating
     decisions with respect to the distribution channels. As a result, total
     assets by distribution channel are not presented.

<TABLE>
<CAPTION>
                                                            THREE MONTHS ENDED SEPTEMBER 30, 1998
                                                                        (IN THOUSANDS)
                             -----------------------------------------------------------------------------------------------------
                               WEB/CALL                                   STRATEGIC
                                CENTER               BRANCH                ALLIANCE
                               DIVISION              NETWORK               PROGRAM              OTHER                 TOTAL
                             --------------    --------------------     ---------------    -----------------    ------------------
<S>                       <C>                  <C>                      <C>                <C>                  <C>
Revenues                  $      2,612.4          $      20,609.0       $        --         $     (117.2)       $     23,104.2
Expenses                         2,072.4                 12,089.0                --              3,314.4              17,475.8
                             --------------    --------------------     ---------------    -----------------    ------------------

Net contribution before
tax and minority
interest                  $        540.0          $       8,520.0       $        --         $   (3,431.6)       $      5,628.4
                             ==============    ====================     ===============    =================    ==================


Loan closings             $     57,892.7          $     526,151.9       $        --         $         --        $    584,044.6
                             ==============    ====================     ===============    =================    ==================

<CAPTION>

                             -----------------------------------------------------------------------------------------------------
                                                            THREE MONTHS ENDED SEPTEMBER 30, 1999
                                                                        (IN THOUSANDS)
                             -----------------------------------------------------------------------------------------------------
                               WEB/CALL                                   STRATEGIC
                                CENTER               BRANCH                ALLIANCE
                               DIVISION              NETWORK               PROGRAM              OTHER                 TOTAL
                             --------------    --------------------     ---------------    -----------------    ------------------
<S>                       <C>                  <C>                      <C>                <C>                  <C>
Revenues                  $      3,668.0        $      7,481.9           $    1,479.9       $     (368.2)        $    12,261.6
Expenses                         4,541.7               4,760.9                1,677.2            8,061.1              19,040.9
                             --------------    --------------------     ---------------    -----------------    ------------------

Net contribution before
tax and minority
interest                  $       (873.7)       $      2,721.0           $     (197.3)      $   (8,429.3)        $    (6,779.3)
                             ==============    ====================     ===============    =================    ==================


Loan closings             $    113,980.0        $    209,459.1           $   56,084.7       $         --         $   379,523.8
                             ==============    ====================     ===============    =================    ==================
</TABLE>


                                                                    Page 9 of 45
<PAGE>   10

<TABLE>
<CAPTION>
                                                              NINE MONTHS ENDED SEPTEMBER 30, 1998
                                                                         (IN THOUSANDS)
                             -------------------------------------------------------------------------------------------------------
                               WEB/CALL                                     STRATEGIC
                                CENTER                BRANCH                 ALLIANCE
                               DIVISION               NETWORK                PROGRAM               OTHER                TOTAL
                             --------------      ------------------      -----------------    ----------------    ------------------
<S>                       <C>                    <C>                     <C>                  <C>                  <C>
Revenues                  $      8,629.2         $      55,823.7         $         --         $     (332.9)        $      64,120.0

Expenses                         6,164.5                34,306.5                   --              8,811.4                49,282.4
                             --------------      ------------------      -----------------    ----------------    ------------------
Net contribution before
tax and minority
interest                  $      2,464.7         $      21,517.2         $         --         $   (9,144.3)        $      14,837.6
                             ==============      ==================      =================    ================    ==================

Loan closings             $    126,044.9         $   1,451,211.4         $         --         $         --         $   1,577,256.3
                             ==============      ==================      =================    ================    ==================

<CAPTION>


                             -------------------------------------------------------------------------------------------------------
                                                              NINE MONTHS ENDED SEPTEMBER 30, 1999
                                                                         (IN THOUSANDS)
                             -------------------------------------------------------------------------------------------------------
                               WEB/CALL                                     STRATEGIC
                                CENTER                BRANCH                 ALLIANCE
                               DIVISION              NETWORK                 PROGRAM               OTHER                TOTAL
                             --------------     -------------------      -----------------     ---------------    ------------------
<S>                       <C>                    <C>                      <C>                  <C>                  <C>
Revenues                  $     10,640.6         $     36,850.9           $      2,537.2       $    (1,032.4)       $     48,996.3
Expenses                        10,264.0               23,117.5                  3,017.6            16,103.2              52,502.3
                             --------------     -------------------      -----------------     ---------------    ------------------
Net contribution before
tax and minority
interest                  $        376.6         $     13,733.4          $        (480.4)      $   (17,135.6)       $     (3,506.0)
                             ==============     ===================      =================     ===============    ==================

Loan closings             $    348,552.5         $  1,016,771.0          $     112,982.3       $          --        $  1,478,305.8
                             ==============     ===================      =================     ===============    ==================
</TABLE>

7.   BRANCH CLOSINGS

          Management's evaluation of the performance of certain retail branches
     during the fourth quarter of 1998 concluded that their continuing viability
     was questionable. The branches' performance was creating both operating
     losses and a "cash drain" on the Company's resources. As of December 31,
     1998, management committed to a plan to close nine Fresh Start stores. In
     1998, the combined loss for the stores closed was $2.5 million, excluding
     the loss recognized for the closing of such stores. A $2.0 million accrual
     was established for this loss at December 31, 1998. As of September 30,
     1999, the Company had incurred approximately $1.4 million relating to the
     store closings, which consisted of fixed asset write-offs, ongoing lease
     commitments, and severance pay for terminated employees. The remaining
     balance in the reserve of approximately $0.6 million is expected to be
     utilized over the remaining life of the lease obligations and/or lease
     termination payments.

          In the beginning of the third quarter of 1999, management committed to
     a plan to close and consolidate twelve of its remaining fifteen branches.
     This plan was part of the Company's strategic initiative to base its growth
     on a Web/Call Center-based origination platform. The branches that remained
     opened were the more profitable branches, consistent with the Company's
     attempt to maintain its branded retail brick and mortar platform in the


                                                                   Page 10 of 45
<PAGE>   11


     metropolitan Detroit area. As of September 30, 1999, the Company had
     accrued or incurred expenses of $3.5 million related to these branch
     closings.

8.   INCOME TAX BENEFIT

     Total income tax benefit for the period ended September 30, 1999 was
     allocated as follows (amounts in thousands):

<TABLE>
<S>                                                               <C>
Loss from operations                                              $    (1,210.3)
Stockholders' equity, for tax benefit
   resulting from exercise of employee stock options                   (6,333.4)
                                                                  -------------
              Total tax benefit                                   $    (7,543.7)
                                                                  =============
</TABLE>

     Income tax expense (benefit) from operations for the nine-month period
     ended September 30, 1999 consists of the following:

<TABLE>
<CAPTION>
                                                        CURRENT               DEFERRED                 TOTAL
                                                   ------------------     ------------------     ------------------
<S>                                                <C>                    <C>                    <C>
U.S. Federal                                       $     (2,646.7)        $       1,470.0        $     (1,176.7)
State and local                                             (75.6)                   42.0                 (33.6)

                                                   ------------------     ------------------     ------------------
Total                                              $     (2,722.3)        $       1,512.0        $     (1,210.3)
                                                   ==================     ==================     ==================

</TABLE>



     The tax effects of temporary differences that give rise to significant
     portions of the deferred tax assets and deferred tax liabilities at
     September 30, 1999 are presented below.



Deferred tax assets:
<TABLE>

<S>                                                            <C>
Tax loss carryforward related to Non-Qualified stock
  options exercised                                            $ 4,499.2
Mortgage loans held for sale, principally due to
  adjustment to market value for tax                               359.4
Accrued liabilities, principally due to estimated branch
  closing costs, investor reserves, and reserve for
  relocation of corporate headquarters                             984.7
Mortgages held for investment, principally due to
  allowance for loan losses                                        125.3
Investment in subsidiary, principally due to adjustments
  to subsidiary mortgage loans held for sale to market
  value                                                             43.1

                                                               ---------
Total deferred tax assets                                      $ 6,011.7
</TABLE>



                                 Page 11 of 45

<PAGE>   12


Deferred tax liabilities:

<TABLE>

<S>                                                              <C>
Property and equipment, principally due to difference in
  depreciation                                                   $ (1,080.0)

                                                                 ----------
Total deferred tax liabilities                                     (1,080.0)

                                                                 ----------
Net deferred tax asset                                           $  4,931.7
                                                                 ==========
</TABLE>

     In assessing the realizability of deferred tax assets, management considers
     whether it is more likely than not that some portion or all of the deferred
     tax assets will not be realized. The ultimate realization of deferred tax
     assets is dependent upon the generation of future taxable income during the
     periods in which those temporary differences become deductible. Management
     considers the scheduled reversal of deferred tax liabilities, projected
     future taxable income, and tax planning strategies in making this
     assessment. Based upon principally the projections for future taxable
     income over the periods which the deferred tax assets are deductible,
     management believes it is more likely than not the Corporation will realize
     the benefits of these deductible differences. Management believes that the
     transition from a brick and mortar operation platform to one based more on
     the Web/Call Center platform will produce operating losses in the near
     term. Business models of the transition show a return to profitability and
     a level of profitability within the period of realization and sufficient
     enough to utilize the benefits of the deferred tax asset. Therefore,
     management believes in the weight of available evidence, it is more likely
     than not to realize the benefit of the deferred tax asset and has not
     recognized a valuation allowance.

9.   COMMITMENTS AND CONTINGENCIES

          The Company signed a lease in April 1999 for a 110,000 square foot
     facility that will afford us the room to potentially create a new 400-seat
     Web/Call Center, including room for approximately 200 loan officers, and
     its National Support Center. The new facility will more than triple the
     size of the Company's current Web/Call Center, which is nearing capacity.
     The move is scheduled to take place in December of 1999. The Company
     estimates that the move will cost it approximately $5.5 million for
     equipment, new technology, leasehold improvements, moving costs and
     accelerated depreciation in the third and fourth quarters of 1999, $3.5
     million of which the Company expects to capitalize. The Company also
     expects the new larger facility will increase its operating expenses by
     approximately $125,000 to $150,000 per month. As of September 30, 1999, the
     Company has incurred or accrued approximately $836,000 of expenses related
     to the relocation, the majority of which is the recognition of the impaired
     value of long-lived assets.

10.  SUBSEQUENT EVENTS

          On October 6, 1999, the Company entered into an Agreement and Plan of
     Merger, with Intuit Inc., (NASDAQ: INTU). Under the Merger Agreement,
     Intuit will acquire the Company, the Company will become a wholly-owned
     subsidiary of Intuit and each of the



                                                                   Page 12 of 45
<PAGE>   13


     Company's outstanding common shares will be converted into the right to
     receive a fraction of a share of Intuit common stock. This fraction is
     calculated by dividing $23.00 by the average of the closing prices of
     Intuit common stock on the Nasdaq Stock Market over the 20 trading days
     ending on the third trading day before the date of the special meeting of
     the Company's shareholders called to approve the merger, currently
     scheduled to be held December 8, 1999. The fraction may not be less than
     0.579832 and may not be more than 0.841463.


          Also, in this merger, Intuit will assume the outstanding options to
     purchase the Company's common shares. As a result, these options will be
     exercisable for Intuit common stock pursuant to their existing terms,
     except that the number of shares will be multiplied by the exchange ratio,
     described above, and the exercise price will be divided by that exchange
     ratio. Under specified conditions, if the Agreement and Plan of Merger is
     terminated or the mergers are not completed, Intuit may be entitled to a
     fee as liquidated damages. Under related voting agreements, the beneficial
     owners of a majority of the outstanding Company common shares have agreed
     to vote their shares in favor of the approval and adoption of the Agreement
     and Plan of Merger. The Company also granted Intuit an option to buy up to
     19.9% of the outstanding Company common shares at $23.00 a share,
     exercisable if specified conditions are triggered. In light of the merger,
     the Company determined to slow down its previously announced national
     advertising campaign during the fourth quarter.

          The Company determined to not pay a dividend in the third and fourth
     quarters of 1999.



                                                                   Page 13 of 45
<PAGE>   14

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

     With the exception of historical information, some of the matters discussed
in this Management's Discussion and Analysis of Financial Condition and Results
of Operations are forward-looking statements that involve risks and
uncertainties and actual results could differ materially from those discussed.
The words and phrases "may," "will," "should," "believe," "expect,"
"anticipate," "estimate," "continue," "predict," and similar expressions
identify forward-looking statements. These forward-looking statements reflect
our current views with respect to future events in financial performance, but
are subject to many risks, uncertainties and factors relating to our operations
and business environment which may cause our actual results to differ materially
from historical results or any future results expressed or implied by such
forward-looking statements. Such risks and uncertainties include the factors
described under the caption "Risk Factors" and elsewhere in Intuit Inc.'s
Registration Statement on Form S-4 (file no. 333-90393) filed November 5, 1999
and elsewhere in this Report.

GENERAL

     We are a technology- and service-driven retail mortgage banking company
that markets conventional, government-insured, and sub-prime mortgage loans and
home equity lines of credit directly to consumers through the Internet
(www.RockLoans.com), our call center, three retail branches and our strategic
alliance program. We believe we are developing a growing brand identity, built
upon our technology, service, people and marketing. We believe we are unlike
most mortgage companies and loan middlemen that have Web sites on the Internet.
We process, underwrite and close the loan ourselves without referring the
customer to another company to perform these services and without charging
additional brokerage fees to our customers. We seek to provide "world class"
service to our customers, thereby encouraging them to return for future loans
and refer others to us for loans. As of November 11, 1999, we had 428 employees,
including 143 loan officers.

     As of April 1, 1999, we changed the way we manage our business, from
managing divisions based on products to divisions based on the method of
distribution of our loan products: the Web/Call Center division, the Branch
network and the Strategic Alliance Program. Our Web/Call Center division markets
loans on-line through our Internet Web site, RockLoans.com, which began
originating loans in January 1999. Our Web/Call Center division also markets
loans through our call center located in our National Support Center in Bingham
Farms, Michigan. Our Branch network markets loans through our network of three
retail loan origination branches. Our Strategic Alliance Program currently
consists of one joint venture, a 70%-owned limited liability company that
originates residential mortgage products to Michigan National Bank's customers
through Michigan National Bank's 192 financial centers, a call center and over
the Internet. Michigan National Bank has approximately 450,000 customers and
owns the other 30% of the joint venture. The joint venture commenced operations
in April 1999.

                                                                   Page 14 of 45
<PAGE>   15


     1999 has been a transition year for us, as we continue to move from a brick
and mortar branch operation to one more based on Internet, Call Center and
Strategic Alliance mortgage lending channels. This transition has adversely
affected our short-term earnings to date and we expect this to continue through
the fourth quarter of 1999. We believe that technology is changing the way
mortgages are originated. Consequently, management committed to a plan to close
and consolidate twelve of our remaining fifteen branches. As of September 30,
1999, we had accrued or incurred expenses of $3.5 million related to these
branch closings.

     On October 6, 1999, we entered into an Agreement and Plan of Merger, with
Intuit Inc., (NASDAQ: INTU). Under the Merger Agreement, Intuit will acquire us,
we will become a wholly-owned subsidiary of Intuit and each of our outstanding
common shares will be converted into the right to receive a fraction of a share
of Intuit common stock. This fraction is calculated by dividing $23.00 by the
average of the closing prices of Intuit common stock on the Nasdaq Stock Market
over the 20 trading days ending on the third trading day before the date of the
special meeting of our shareholders called to approve the merger, currently
scheduled to be held December 8, 1999. The fraction may not be less than
0.579832 and may not be more than 0.841463.

     Also, in this merger, Intuit will assume the outstanding options to
purchase our common shares. As a result, these options will be exercisable for
Intuit common stock pursuant to their existing terms, except that the number of
shares will be multiplied by the exchange ratio, described above, and the
exercise price will be divided by that exchange ratio. Under specified
conditions, if the Agreement and Plan of Merger is terminated or the mergers are
not completed, Intuit may be entitled to fees as liquidated damages. Under
related voting agreements, the beneficial owners of a majority of our
outstanding common shares have agreed to vote their shares in favor of the
approval and adoption of the Agreement and Plan of Merger. We also granted
Intuit an option to buy up to 19.9% of our outstanding common shares at $23.00 a
share, exercisable if specified conditions are triggered. In light of the
merger, we determined to slow down our previously announced national advertising
campaign during the fourth quarter.

     In the third quarter of 1999, margins on all of our products, and volumes
of our Conventional Loans as well as our Sub-Prime Loans continued to decline
from fourth quarter 1998 levels. Volumes of our Conventional Loan and Sub-Prime
Loan originations have also continued to decline so far in the fourth quarter of
1999 from the third quarter 1999 levels. The declines are primarily due to
higher interest rates, lower refinancing loan volumes and our closing of 25
branches and one marketing center in 1999. We expect these trends to continue in
the fourth quarter of 1999 and our fourth quarter 1999 operating results to be
below our third quarter 1999 operating results.

     We also plan to make other moves that are intended to further our long-term
business and our transition from a brick and mortar branch operation to one more
based on Internet, Call Center and Strategic Alliance mortgage lending channels.
We expect that this continued transition will adversely affect our short-term
earnings. We have signed a lease for an 110,000 square foot facility that will
afford us the room to potentially create a new 400-seat Web/Call Center,
including room for approximately 200 loan officers, and our National Support
Center. The move is scheduled to take place in December of 1999. We estimate
that the move will cost


                                                                   Page 15 of 45
<PAGE>   16

us approximately $5.5 million for equipment, new technology, leasehold
improvements, moving costs and accelerated depreciation in the third and fourth
quarters of 1999, $3.5 million of which we expect to capitalize. We also expect
the new larger facility will increase our operating expenses by approximately
$125,000 to $150,000 a month. As of September 30, 1999, we have accrued or
incurred approximately $836,000 of expenses related to the relocation, the
majority of which is the recognition of the impaired value of long-lived assets.

TERMINATION OF S CORPORATION STATUS AND INCOME TAXES

     Simultaneously with the closing of our initial public offering on May 6,
1998 (the "Offering"), we ceased to be taxed as an S corporation under the
Internal Revenue Code. In connection with the termination of our S corporation
status, we paid an estimate of our income taxed or taxable to our shareholders
while we were an S Corporation, but not yet distributed to them ("Shareholder
Distribution Amount") out of the net proceeds of the Offering to our
shareholders existing immediately before the closing of the Offering (the
"Existing Shareholders"). The estimated Shareholder Distribution Amount,
including the approximately $5.4 million tax distribution to the Existing
Shareholders on April 10, 1998, was approximately $25.0 million. Based upon the
final results of 1998, the Existing Shareholders were required to pay us
approximately $800,000, representing the excess of amounts disbursed in May 1998
over the year-end estimate of the taxable income allocable to the Existing
Shareholders. The amount due to us was paid in full as of March 31, 1999.

     As an S corporation, our income, whether or not distributed, was taxed at
the shareholder level for federal and state tax purposes. When we terminated our
S corporation status, we became subject to federal and state income taxation and
we recorded a $1.8 million deferred tax asset on our balance sheet along with a
current income tax liability of $0.9 million as of May 6, 1998. The amount of
the deferred tax asset is based on timing differences between tax and book
accounting relating principally to marking loans to market for tax purposes. The
pro forma provision for income taxes in the statements of income are intended to
show results as if we had been subject to federal and state taxation at the tax
rates effective for the periods presented.




                                                                   Page 16 of 45
<PAGE>   17

RESULTS OF OPERATIONS

THREE MONTHS ENDED SEPTEMBER 30, 1999
         VERSUS THREE MONTHS ENDED SEPTEMBER 30, 1998

         The following table sets forth our revenues, expenses and pre-tax
income (loss) for the three months ended September 30, 1998 and 1999:

<TABLE>
<CAPTION>
                                                                              Three-Months Ended
                                                                                 September 30,
                                                                     ---------------------------------------
                                                                              1998                1999
                                                                     ----------------      -----------------
                                                                                 (In thousands)
<S>                                                                         <C>                  <C>
       Total revenue..........................................              $ 23,104             $ 12,262
       Total expenses.........................................               (17,476)             (19,041)
                                                                            --------             ---------
       Income (loss) before taxes and minority
            interest..........................................              $  5,628             $ (6,779)
                                                                            ========             ========
</TABLE>

         Our total revenues decreased from $23.1 million in the third quarter of
1998 to $12.3 million in the third quarter of 1999, a decrease of $10.8 million,
or 46.9%. The decrease in revenues is primarily due to the following:

  -      a decrease of $100.8 million, or 23.5%, in the volume of Conventional
         Loans we sold in the third quarter of 1999 compared to the third
         quarter of 1998;
  -      a decrease of $65.3 million, or 61.6%, in the volume of Sub-Prime Loans
         we sold in the third quarter of 1999 compared to the third quarter of
         1998;
  -      a decrease of $12.1 million, or 100%, in the volume of High LTV Loans
         we sold in the third quarter of 1999 compared to the third quarter of
         1998;
  -      a 21.7% decrease in margins earned on loan fees and gains on sale of
         Conventional Loans in the third quarter of 1999 compared to the third
         quarter of 1998;
  -      an 18.0% decrease in margins earned on loan fees and gains on sale of
         Sub-Prime Loans in the third quarter of 1999 compared to the third
         quarter of 1998; and
  -      a 9.1% decrease in margins earned on loan fees and gains on sale of
         government-insured Loans in the third quarter of 1999 compared to the
         third quarter of 1998;

partially offset by an increase of $35.5 million, or 300.7%, in the volume of
government-insured loans we sold in the third quarter of 1999 compared to the
third quarter of 1998.

         In the third quarter of 1999, margins on all of our products, and
volumes of our Conventional Loan and Sub-Prime Loan originations, continued to
decline from fourth quarter 1998 levels. Volumes of our Conventional Loan and
Sub-Prime Loan originations have also continued to decline so far in the fourth
quarter of 1999 from the third quarter 1999 levels. The declines are primarily
due to higher interest rates, lower refinancing loan volumes and our

                                                                   Page 17 of 45

<PAGE>   18

closing of 25 branches and one marketing center in 1999. We expect these trends
to continue into the fourth quarter, as we continue our transition to an
Internet and call center-based loan origination system. We also expect our
fourth quarter 1999 operating results to be below third quarter 1999 operating
results.

     During the third quarter of 1999, we disbursed $376.0 million of loans, a
decrease of $195.9 million, or 34.2%, from the $571.9 million of loans disbursed
in the third quarter of 1998. The $195.9 million decrease included a $154.9
million decrease in Conventional Loans, a $65.0 million decrease in Sub-Prime
Loans, and a $12.2 million decrease in High LTV Loans, partially offset by a
$33.4 million increase in government-insured loans and a $2.8 million increase
in Home Equity Line of Credit loans. Our loans held for sale decreased by $40.7
million in the third quarter of 1999, compared to an increase of $12.6 million
in the third quarter of 1998. The decrease was due to our disbursing $376.0
million in loans while selling $416.7 million in loans in the third quarter of
1999. The decrease in loans held for sale in the third quarter of 1999 included
decreases of $34.0 million in Conventional Loans, $3.9 million in
government-insured loans and $2.8 million in Sub-Prime Loans. The increase in
loans held for sale in the third quarter of 1998 included increases of $14.3
million in Conventional Loans, $1.3 million in government-insured loans and $0.1
million in High LTV Loans, partially offset by a decrease of $3.1 million in
Sub-Prime Loans.

     Total expenses increased from $17.5 million in the third quarter of 1998 to
$19.0 million in the third quarter of 1999, an increase of $1.5 million, or
9.0%, primarily due to one-time charges of $3.5 million related to the closing
and consolidation of branches in the third quarter of 1999, and $0.8 million
related to the relocation of our corporate headquarters, the majority of which
is the recognition of the impaired value of long-lived assets. These increases
were partially offset by reduced commissions as a result of lower origination
volumes and an increase in the portion of Conventional Loans originated, which
have lower commission rates, and reduced marketing expenses, partly as a result
of the closing of 25 branches and one marketing center in 1999 and reduced
postage and delivery expenses as a result of reduced origination volumes.





                                                                   Page 18 of 45
<PAGE>   19

     The following table sets forth information regarding the components of our
revenues for the three months ended September 30, 1998 and 1999:

<TABLE>
<CAPTION>
                                                                                       Three-Months
                                                                                     Ended September 30,
                                                                             -------------------------------
                                                                                 1998                 1999
                                                                             ----------            ---------
                                                                                       (In thousands)
<S>                                                                          <C>                  <C>
Interest income........................................................      $    2,964           $    1,608
Interest expense.......................................................          (1,482)                (369)
                                                                             ----------           ----------
     Net interest margin...............................................           1,482                1,239
Provision for credit losses............................................            (140)                (400)
                                                                             ----------           ----------
     Net interest margin after provision for credit losses.............           1,342                  839
Loan fees and gains on sale of mortgages...............................          21,761               11,420
Other income...........................................................               1                    2
                                                                             ----------           ----------
     Total revenue.....................................................      $   23,104           $   12,261
                                                                             ==========           ==========

</TABLE>

         Net interest margin before provision for credit losses decreased from
$1.5 million in the third quarter of 1998 to $1.2 million in the third quarter
of 1999, a decrease of $0.3 million, or 16.4%. The decrease was primarily due to
the following:

   -     a decrease in the average balance of mortgages held for sale in the
         third quarter of 1999 as compared to the same period in 1998;

   -     a 64.9% decrease in Sub-Prime Loan closings in the third quarter of
         1999 as compared to the third quarter of 1998, which typically have
         higher interest rates than our other loan products;

partially offset by a decrease in the weighted average interest rates paid on
our borrowing facilities, from 6.78% in the third quarter of 1998 to 6.59% in
the third quarter of 1999;

     We intend to continue holding our loans for a shorter period of time before
selling them and anticipate additional reductions in the average balance of
mortgages held for sale in the fourth quarter of 1999, which we expect will
significantly decrease our net interest margin from that experienced in the
fourth quarter of 1998.

     Buyers of our loans may require us to repurchase or substitute loans in the
event of a breach of representations and warranties, including any fraud or any
misrepresentation made during the loan origination process. In addition, during
the period we hold our loans we face the risk of delinquencies and resulting
foreclosure losses. As a result of these risks we recorded a provision for
credit losses of approximately $140,000 in the third quarter of 1998 and
recorded a provision for credit losses of approximately $400,000 in the third
quarter of 1999, partly for future repurchase or substitution requirements
relating to loans sold in those periods, and credit risk for loans held for
sale and investment. The increase in the provision in the third quarter of 1999
as compared to the third quarter of 1998 was primarily due to the increased
portion of High LTV Loans (second mortgages with combined



                                                                   Page 19 of 45
<PAGE>   20

loan-to-value ratios greater than 100%) and past due loans in loans held for
investment during 1999 along with increased indemnification payments with
respect to these High LTV Loans. These loans required a greater than normal
reserve because they are delinquent, creating a likelihood of a greater loss. As
a result, the provision for credit losses and the reserve for representations
and warranties during the third quarter of 1999 was greater than in the third
quarter of 1998. During the third quarter of 1998 and 1999 no loans were
reclassified as real estate owned.

     Loan fees and gains on sale of mortgages decreased from $21.8 million in
the third quarter of 1998 to $11.4 million in the third quarter of 1999, a
decrease of $10.4 million, or 47.5%. The decrease in revenue is primarily due to
the changes in sale of loans described above, as well as changes in the margins
earned on loan fees and gains on sale of loans described above. The decrease in
the volume of High LTV Loans we sold is a result of our decision to stop
originating High LTV Loans in the third quarter of 1998. The decrease in the
volume of Sub-Prime Loans we sold is primarily due to a 64.9% decrease in
Sub-Prime Loan closings as a result of our branch closings in 1999 and our sale
of $1.3 million more Sub-Prime Loans in the third quarter of 1999 than we
disbursed, compared to $2.7 million more in the third quarter of 1998. The
decrease in the volume of Conventional Loans we sold is primarily due to a 34.4%
decrease in Conventional Loan closings as a result of a rising interest rate
environment in the third quarter of 1999 compared to the third quarter of 1998
and our branch closings in 1999, partially offset by our sale of $33.1 million
more Conventional Loans in the third quarter of 1999 than we disbursed, compared
to $14.0 million fewer in the third quarter of 1998. The increase in the volume
of government-insured loans we sold is primarily due to a 234.4% increase in
government-insured loan closings as a result of a higher volume of home purchase
loans along with our increased emphasis on government-insured lending in the
third quarter of 1999 compared to the third quarter of 1998 and our sale of $3.3
million more government-insured loans in the third quarter of 1999 than we
disbursed, compared to $1.3 million fewer in the third quarter of 1998.

     The decrease in margins earned on loan fees and gains on sale of
Conventional Loans and government-insured loans, when comparing the third
quarter of 1999 to the third quarter of 1998, was primarily the result of a
higher interest rate environment, which increased the need for rate
competitiveness. We expect this trend to continue into the fourth quarter of
1999. We also expect that Conventional Loan closings will further decline in the
fourth quarter of 1999, as compared to the third quarter of 1999 due, in part,
to increases in mortgage interest rates, which should reduce consumer demand for
refinancing existing mortgages, along with the closing of 25 branches (includes
the 13 closed in the first six months of 1999 and the 12 additional closed in
the third quarter) and one marketing center to further the transition to a
Web/Call Center environment and a slowing of new housing starts in the third
quarter of 1999. The decrease in margins earned on loan fees and gains on sale
of Sub-Prime Loans was due to the turmoil in the industry, which created a
surplus of Sub-Prime Loans available for sale thereby driving down the prices of
these loans. We expect both loan closings and revenue to decline from Sub-Prime
Loans in fourth quarter of 1999, principally due to the branch closings in 1999.


                                                                   Page 20 of 45
<PAGE>   21
         The decrease in loan fees and gains on sale of mortgages was partially
offset by a decrease in our recapture reserve in the third quarter of 1999. Some
Sub-Prime Loan sales require us to return a portion of the premium we received
on the sale of the loan if the loan is prepaid by the customer within the first
year after sale. We record a provision for this risk separate from the provision
for credit losses based on our evaluation of the terms of our sale contracts and
our assumptions concerning prepayments. We increased our reserve, and decreased
our loan fees and gains on sale of mortgages, by approximately $0.3 million, in
the third quarter of 1998. Virtually all of the loans we originated in the third
quarter of 1999 contained a prepayment penalty in excess of the reserve
requirement. Therefore, based on our analysis, the reserve for this premium
recapture was adequate at September 30, 1999 and no further provision was
required.

The following table sets forth information regarding the components of our
expenses for the three months ended September 30, 1998 and 1999:

<TABLE>
<CAPTION>

                                                                                        Three-Months
                                                                                     Ended September 30,
                                                                               ------------------------------
                                                                                 1998                   1999
                                                                               --------               -------
                                                                                       (In thousands)
<S>                                                                            <C>                    <C>

Salaries, commissions and employee benefits............................        $10,086                $ 8,357
General and administrative expenses....................................          3,452                  2,997
Marketing expenses.....................................................          3,396                  2,837
Depreciation and amortization..........................................            542                    514
Loss on branch closings................................................                                 3,500
Costs incurred or accrued in connection with the relocation
   of corporate headquarters...........................................                                   836
                                                                               -------                -------
     Total expenses....................................................        $17,476                $19,041
                                                                               =======                =======
</TABLE>

         Salaries, commissions and employee benefits decreased from $10.1
million in the third quarter of 1998 to $8.4 million in the third quarter of
1999, a decrease of $1.7 million, or 17.1%. The decrease was primarily
attributable to a decrease in commissions as a result of lower origination
volumes and a change in the mix of products originated. More Conventional Loans
were closed which have a lower commission structure than Sub-Prime Loans. These
expenses are expected to continue to fluctuate in the fourth quarter of 1999 in
connection with our planned expansion of existing operations, which includes our
continued development of our Internet presence and strategic alliance.

         General and administrative expenses consist primarily of occupancy
costs, professional services, office expenses, automobile and delivery expenses
and other expenses, many of which vary with the volume of loan closings. General
and administrative expenses decreased from $3.5 million in the third quarter of
1998 to $3.0 million in the third quarter of 1999, a decrease of $0.5 million,
or 13.2%. The decrease was primarily attributable to a decrease in occupancy
expenses as a result of closing 25 branches in 1999 and a decrease in postage
and delivery expenses as a result of lower origination volumes. These decreases
were partially offset by increased professional fees during the third quarter of
1999, primarily legal and


                                                                   Page 21 of 45
<PAGE>   22

accounting fees associated with various projects that we were working on during
the quarter. Certain of these expenses are expected to vary according to the
volume of loan closings in the fourth quarter of 1999, except for occupancy
expenses, which are expected to decrease for the branches closed in the third
quarter of 1999, partially offset by an increase of $125,000 to $150,000 per
month in connection with our move to a new Web/Call Center and National Support
Center, which is scheduled to occur in December of 1999.

         Marketing expenses decreased from $3.4 million in the third quarter of
1998 to $2.8 million in the third quarter of 1999, a decrease of $0.6 million,
or 16.5%. The decrease was primarily attributable to our closing 25 branches and
one marketing center in 1999.

         Depreciation and amortization expenses remained consistent at $0.5
million in the third quarters of 1998 and 1999. These expenses are expected to
increase in 1999 as a result of the expansion of our Web center and the
relocation of our Web/Call Center and National Support Center, partially offset
by a decrease in depreciation attributable to the branches closed in 1999.

         In the beginning of the third quarter of 1999, we committed to a plan
to close and consolidate twelve of our remaining fifteen branches. As of
September 30, 1999, we have accrued or incurred expenses of $3.5 million
relating to these branches, which consisted of fixed asset write-offs, ongoing
lease commitments, and severance pay for terminated employees related to these
branch closings.

         During the third quarter of 1999, we accrued or incurred approximately
$836,000 of expenses related to the relocation of our corporate headquarters
(National Support Center) and Web/Call center (the majority of which is the
recognition of the impaired value of long-lived assets). We have signed a lease
for an 110,000 square foot facility that will afford us the room to potentially
create a new 400-seat Web/Call Center, including room for approximately 200 loan
officers, and our National Support Center. The move is scheduled to take place
in December of 1999. We estimate that the move will cost us approximately $5.5
million for equipment, new technology, leasehold improvements, moving costs and
accelerated depreciation in the third and fourth quarters of 1999, $3.5 million
of which we expect to capitalize. We also expect the new larger facility will
increase our operating expenses by approximately $125,000 to $150,000 a month.

         Effective May 6, 1998, the Company's tax status changed from that of an
S corporation to that of a C corporation. As a C corporation we became subject
to federal and state income taxation in the second quarter of 1998. As an S
corporation, our taxable income was included in the individual returns of the
shareholders. As a result, our income taxes due to quarterly earnings for the
second quarter of 1998 represents income taxes provided based on our estimated
allocation of income before income taxes between the S corporation and the C
corporation as required under IRS regulations.

         In addition, in connection with the change in our tax status, we
recognized a net income tax benefit due to conversion of the S corporation of
approximately $0.9 million during the second quarter of 1998. Upon conversion to
a C corporation, we recorded a net deferred tax



                                                                   Page 22 of 45
<PAGE>   23

asset of approximately $1.8 million, and recognized a corresponding deferred
income tax benefit. The deferred income tax benefit was somewhat offset by our
recognition of a current income tax liability of approximately $0.9 million
associated with the allocation of our taxable income between the S corporation
and the C corporation. For the quarter ended September 30, 1999, we recognized
an income tax benefit of approximately $2.4 million.

NINE MONTHS ENDED SEPTEMBER 30, 1999
         VERSUS NINE MONTHS ENDED SEPTEMBER 30, 1998

         The following table sets forth our revenues, expenses and pre-tax
income for the nine months ended September 30, 1998 and 1999:

<TABLE>
<CAPTION>

                                                                                 Nine-Months Ended
                                                                                   September 30,
                                                                    -----------------------------------------
                                                                          1998                     1999
                                                                    -----------------       -----------------
                                                                                  (In thousands)
<S>                                                                 <C>                     <C>

       Total revenue..........................................      $     64,120            $     48,996
       Total expenses.........................................           (49,282)                (52,502)
                                                                    =================       =================
       Income (loss) before taxes and minority
            interest                                                $     14,838            $     (3,506)
                                                                    =================       =================

</TABLE>

         Our total revenues decreased from $64.1 million in the first nine
months of 1998 to $49.0 million in the first nine months of 1999, a decrease of
$15.1 million, or 23.6%. The decrease in revenues is primarily due to the
following:

--       a decrease of $135.3 million, or 45.3%, in the volume of Sub-Prime
         Loans we sold in the first nine months of 1999 compared to the first
         nine months of 1998;
--       a decrease of $56.3 million, or 98.6%, in the volume of High LTV Loans
         we sold in the first nine months of 1999 compared to the first nine
         months of 1998;
--       a 68.5% decrease in margins earned on loan fees and gains on sale of
         High LTV Loans in the first nine months of 1999 compared to the first
         nine months of 1998;
--       a 24.6% decrease in margins earned on loan fees and gain on sale of
         Sub-Prime Loans in the first nine months of 1999 compared to the first
         nine months of 1998;
--       a 1.6% decrease in margins earned on loan fees and gain on sale of
         government-insured loans in the first nine months of 1999 compared to
         the first nine months of 1998; and
--       an 0.8% decrease in margins earned on loan fees and gain on sale of
         Conventional Loans in the first nine months of 1999 compared to the
         first nine months of 1998

partially offset by the following:

--       an increase of $172.0 million, or 14.7%, in the volume of Conventional
         Loans we sold in the first nine months of 1999 compared to the first
         nine months of 1998; and


                                                                   Page 23 of 45
<PAGE>   24

--       an increase of $91.6 million, or 295.7%, in the volume of
         government-insured loans we sold in the first nine months of 1999
         compared to the first nine months of 1998.

         In the first nine months of 1999, margins on all of our products, and
volumes of our Conventional Loan and Sub-Prime Loan originations, declined from
fourth quarter 1998 levels. The declines are primarily due to higher interest
rates, lower refinancing loan volumes and our closing of 25 branches and one
marketing center in 1999. We expect these trends to continue in the fourth
quarter of 1999, as we continue our transition to an Internet and call
center-based loan origination system. We also expect our operating results for
the remainder of 1999 to be below our third quarter 1999 operating results.

         During the first nine months of 1999, we disbursed $1,515.8 million of
loans, a decrease of $25.2 million, or 1.6%, from the $1,541.0 million of loans
disbursed in the first nine months of 1998. The $25.2 million decrease included
a $141.8 million decrease in Sub-Prime Loans and a $52.0 million decrease in
High LTV Loans, partially offset by a $94.1 million increase in government-
insured loans, a $70.5 million increase in Conventional Loans, and a $4.0
million increase in Home Equity Line of Credit Loans. Our loans held for sale
decreased by $114.4 million in the first nine months of 1999, compared to a
decrease of $17.2 million in the first nine months of 1998. The decrease, which
had a significant positive effect on our 1999 profitability, was due to our
selling $1,630.2 million in loans while disbursing $1,515.8 million in loans in
the first nine months of 1999. The decrease in loans held for sale in the first
nine months of 1999 included decreases of $91.6 million in Conventional Loans,
$26.0 million in Sub-Prime Loans and $0.7 million in High LTV Loans, partially
offset by a $3.9 million increase in government-insured loans. The decrease in
loans held for sale in the first nine months of 1998 included decreases of $19.6
million in Sub-Prime Loans and $5.0 million in High LTV Loans, partially offset
by increases of $4.5 million in Conventional Loans and $2.9 million in
government-insured loans.

          Total expenses increased from $49.3 million in the first nine months
of 1998 to $52.5 million in the first nine months of 1999, an increase of $3.2
million, or 6.5%. The increase was primarily due to one time charges of $3.5
million related to the closing and consolidation of branches in the third
quarter of 1999, $0.8 million related to the relocation of the corporate
headquarters (the majority of which is the recognition of the impaired value of
long-lived assets), increased salaries attributable to compensation for new
management team members and additional hiring of staff to the marketing,
technology and other support areas to facilitate the transition to the Web/Call
Center based platform and increases in professional services. These increases
were partially offset by reduced commissions as a result of an increase in the
portion of Conventional Loans originated, reduced marketing expenses, partly as
a result of closing 25 branches and one marketing center in 1999 and reduced
automobile and delivery expenses as a result of reduced origination volumes.


                                                                   Page 24 of 45
<PAGE>   25

         The following table sets forth information regarding the components of
our revenues for the nine months ended September 30, 1998 and 1999:

<TABLE>
<CAPTION>

                                                                                         Nine months
                                                                                     Ended September 30,
                                                                               -----------------------------
                                                                                 1998                 1999
                                                                               -------              --------
                                                                                       (In thousands)
<S>                                                                            <C>                  <C>

Interest income........................................................        $  9,192             $ 6,521
Interest expense.......................................................          (5,102)             (2,401)
                                                                               --------             -------
     Net interest margin...............................................           4,090               4,120
Provision for credit losses............................................            (389)             (1,083)
                                                                               --------             -------
     Net interest margin after provision for credit losses.............           3,701               3,037
Loan fees and gains on sale of mortgages...............................          60,401              45,955
Other income...........................................................              18                   4
                                                                               --------             -------
     Total revenue.....................................................        $ 64,120             $48,996
                                                                               ========             =======
</TABLE>

         Net interest margin before provision for credit losses remained
consistent at $4.1 million for the first nine months of 1998 and 1999. Interest
income was $6.5 million in the first nine months of 1999, a $2.7 million, or
29.1% decrease, as compared to $9.2 million in the first nine months of 1998.
Interest expense decreased from $5.1 million in the first nine months of 1998 to
$2.4 million in the first nine months of 1999, a decrease of $2.7 million, or
52.9%. The decreases were primarily due to the following:

         --    a decrease in the average balance of mortgages held for sale in
               first nine months of 1999;

         --    a 52.6% decrease in Sub-Prime Loan closings during the first nine
               months of 1999 compared to the first nine months of 1998, which
               typically have a higher interest rate than our other loans
               products;

         --    a decrease in the weighted average interest rates paid on our
               borrowing facilities, from 6.84% in the first nine months of 1998
               to 6.14% in the first nine months of 1999; and

         --    our increased use of cash generated from operations and our
               initial public offering to fund our loans in 1999.

         Buyers of our loans may require us to repurchase or substitute loans in
the event of a breach of representations and warranties, including any fraud or
any misrepresentation made during the loan origination process. In addition,
during the period we hold our loans, we face the risk of delinquencies and
resulting foreclosure losses. As a result of these risks we recorded a provision
for credit losses of approximately $389,000 in the first nine months of 1998 and
recorded a provision for credit losses of approximately $1,083,000 in the first
nine months of 1999, partly for future repurchase or substitution requirements
relating to loans sold in these periods, and credit risk for loans held for sale
and investment. The increase was primarily due to the significant increase in
the volume of loans held for investment that were past due along with increased
indemnification payments in connection with these of High LTV Loans. During the
fourth quarter of 1998 and the first quarter of 1999, the secondary


                                                                   Page 25 of 45
<PAGE>   26

market Sub-Prime Loan buyers changed their underwriting standards, making it
more difficult for us to sell some of our loans. As a result, we held these
loans for a longer period of time than normal or could not sell some of them,
which resulted in us being exposed to more delinquencies than normal. In the
beginning of the third quarter of 1999, we found a buyer for these loans, which
resulted in a charge to the allowance for losses of $1,100,000. During the first
nine months of 1998, two loans were reclassified as real estate owned, resulting
in charges of approximately $192,000 against the allowance for credit losses. In
the first nine months of 1999, four loans were reclassified as real estate
owned, resulting in charges of approximately $48,000 against the reserve.

         Loan fees and gains on sale of mortgages decreased from $60.4 million
in the first nine months of 1998 to $46.0 million in the first nine months of
1999, a decrease of $14.4 million, or 23.9%. This decrease is primarily due to
the changes in sales of loans described above, as well as changes in the margins
earned on loan fees and gains on sale of loans described above. The decrease in
the volume of High LTV Loans we sold is a result of our decision to stop
originating High LTV Loans in the third quarter of 1998. The decrease in the
volume of Sub-Prime Loans we sold is primarily due to a 52.6% decrease in
Sub-Prime Loan closings as a result of our branch closings in 1999, partially
offset by our sale of $24.1 million more Sub-Prime Loans in the first nine
months of 1999 than we disbursed, compared to $18.1 million more in the first
nine months of 1998. The increase in the volume of Conventional Loans we sold is
primarily due to our sale of $92.5 million more Conventional Loans in the first
nine months of 1999 than we disbursed, compared to $8.6 million fewer in the
first nine months of 1998. The increase in the volume of government-insured
loans we sold is primarily due to a 286.2% increase in government-insured loan
closings as a result of a higher volume of home purchase loans as well as our
increased emphasis on government-insured lending in the first nine months of
1999 compared to the first nine months of 1998, partially offset by our sale of
$1.4 million fewer government-insured loans in the first nine months of 1999
than we disbursed, compared to $0.6 million fewer in the first nine months of
1998. We also expect that Conventional and Sub-Prime Loan closings will further
decline in the fourth quarter of 1999 compared to the third quarter of 1999 due,
in part, to increases in mortgage interest rates in 1999, which should reduce
consumer demand for refinancing existing mortgages, along with the closing of 25
branches (includes the 13 closed in the first six months of 1999 and the 12
additional closed in the third quarter) and one marketing center and the
transition to a Web/Call Center environment and a slowing of new housing starts
in the third quarter of 1999.

         The decrease in margins earned on loan fees and gains on sale of
Sub-Prime Loans was due to the turmoil in the industry, which created a surplus
of Sub-Prime Loans available for sale thereby driving down the prices of these
loans. We expect both loan closings and revenue to continue to decline from
Sub-Prime Loans in the remainder of 1999, principally due to the branch closings
in 1999. The decrease in margins earned on loan fees and gains on sale of
Conventional Loans and government-insured loans, when comparing the first nine
months of 1999 to the first nine months of 1998, was primarily the result of
increased interest rates, which increased the need for rate competitiveness. We
expect this trend to continue in the fourth quarter of 1999.



                                                                   Page 26 of 45
<PAGE>   27
         The decrease in loan fees and gains on sale of mortgages was partially
offset by a decrease in our recapture reserve in the first nine months of 1999.
Some Sub-Prime Loan sales require us to return a portion of the premium we
received on the sale of the loan if the loan is prepaid by the customer within
the first year after sale. We record a provision for this risk separate from the
provision for credit losses based on our evaluation of the terms of our sale
contracts and our assumptions concerning prepayments. We increased our reserve,
and decreased our loan fees and gains on sale of mortgages, by approximately
$12,800 for this risk in the first nine months of 1999, compared to an increase
of approximately $971,900, in the first nine months of 1998. The decrease was
due to a provision not being recorded in the second and third quarters of 1999
as virtually all of the loans we originated in the second and third quarters of
1999 contained a prepayment penalty in excess of the reserve requirement.
Therefore, based on our analysis, the reserve for this premium recapture was
adequate at September 30, 1999 and no further provision was required.

         The following table sets forth information regarding the components of
our expenses for the nine-months ended September 30, 1998 and 1999:

<TABLE>
<CAPTION>

                                                                                         Nine-Months
                                                                                     Ended September 30,
                                                                                ------------------------------
                                                                                   1998                1999
                                                                                ----------          ----------
                                                                                       (In thousands)
<S>                                                                             <C>                  <C>

Salaries, commissions and employee benefits............................         $28,282              $28,946
General and administrative expenses....................................           9,550               10,014
Marketing expenses.....................................................           9,857                7,433
Depreciation and amortization..........................................           1,593                1,774
Loss on branch closings................................................                                3,500
Costs incurred or accrued in connection with the relocation
    of corporate headquarters..........................................                                  836
                                                                                -------              -------
     Total expenses....................................................         $49,282              $52,503
                                                                                =======              =======
</TABLE>


         Salaries, commissions and employee benefits increased from $28.3
million in the first nine months of 1998 to $28.9 million in the first nine
months of 1999, an increase of $0.6 million, or 2.3%. The increase was primarily
attributable to salaries for new management, marketing, technology and other
support, partially offset by a decrease in commissions as a result of lower
origination volumes in the first nine months of 1999 as compared to the first
nine months of 1998 and an increase in the portion of Conventional Loans
originated, which have lower commission rates than our other products. These
expenses are expected to continue to fluctuate in the remainder of 1999 in
connection with our expansion of existing operations, along with our continued
development of our Internet presence and strategic alliance.

         General and administrative expenses consist primarily of occupancy
costs, professional services, office expenses, automobile and delivery expenses
and other expenses, many of which vary with the volume of loan closings. General
and administrative expenses increased from $9.5 million in the first nine months
of 1998 to $10.0 million in the first nine months of 1999, an increase of $0.5
million, or 4.9%. The increase was primarily attributable to an


                                                                   Page 27 of 45
<PAGE>   28

increase in occupancy expenses, professional services, and expenses related to
technology, support and other personnel hired in connection with our new Web
site, partially offset by a decrease in automobile and delivery expenses that
fluctuate with the volume of originations. Certain of these expenses are
expected to vary according to the volume of loan closings in 1999, except for
occupancy expenses, which are expected to decrease for branches closed in 1999,
partially offset by an increase in connection with our move to a new Web/Call
Center and National Support Center, which is scheduled to occur in December of
1999.

         Marketing expenses decreased from $9.9 million in the first nine months
of 1998 to $7.4 million in the first nine months of 1999, a decrease of $2.5
million, or 24.6%. The decrease was primarily attributable to our closing 25
branches and one marketing center in the first nine months of 1999 and our
discontinued origination of High LTV Loans in the third quarter of 1998.

         Depreciation and amortization expenses increased from $1.6 million in
the first nine months of 1998 to $1.8 million in the first nine months of 1999,
an increase of $0.2 million, or 11.3%. The increase was primarily attributable
to our purchases of additional equipment and leasehold improvements during the
latter part of 1998 and during 1999 for our new Web center and existing
branches. The expenses are expected to continue to increase in 1999 as a result
of the relocation of our Web/Call Center and National Support Center, partially
offset by the decrease attributable to the branches closed in 1999.

         In the beginning of the third quarter of 1999, we committed to a plan
to close and consolidate twelve of our remaining fifteen branches. As of
September 30, 1999, we have accrued or incurred expenses of $3.5 million
relating to these branches which consisted of fixed asset write-offs,
ongoing lease commitments, and severance pay for terminated employees related to
these branch closings.

         During the third quarter of 1999, we accrued or incurred approximately
$836,000 of expenses related to the relocation of our corporate headquarters
(National Support Center) and Web/Call center (the majority of which is the
recognition of the impaired value of long-lived assets). We have signed a lease
for an 110,000 square foot facility that will afford us the room to potentially
create a new 400-seat Web/Call Center, including room for approximately 200 loan
officers, and our National Support Center. The move is scheduled to take place
in December of 1999. We estimate that the move will cost us approximately $5.5
million for equipment, new technology, leasehold improvements, moving costs and
accelerated depreciation in the third and fourth quarters of 1999 and the first
quarter of 2000, $3.5 million of which we expect to capitalize. We also expect
the new larger facility will increase our operating expenses by approximately
$125,000 to $150,000 a month.

         Effective May 6, 1998, the Company's tax status changed from that of an
S corporation to that of a C corporation. As a C corporation we became subject
to federal and state income taxation in the second quarter of 1998. As an S
corporation, our taxable income was included in the individual returns of the
shareholders. As a result, our income taxes due to quarterly earnings for the
first nine months of 1998 represents income taxes provided based on our


                                                                   Page 28 of 45
<PAGE>   29

estimated allocation of income before income taxes between the S corporation and
the C corporation as required under IRS regulations.

         In addition, in connection with the change in our tax status, we
recognized a net income tax benefit due to conversion of the S corporation of
approximately $0.9 million during the second quarter of 1998. Upon conversion to
a C corporation, we recorded a net deferred tax asset of approximately $1.8
million, and recognized a corresponding deferred income tax benefit. The
deferred income tax benefit was somewhat offset by our recognition of a current
income tax liability of approximately $0.9 million associated with the
allocation of our taxable income between the S corporation and the C
corporation. For the nine months ended September 30, 1999, we recognized income
tax benefit of approximately $1.2 million. This benefit is comprised of a
current tax benefit of $2.7 million offset by a deferred tax asset of $1.5
million.

SEGMENT ANALYSIS

         Our growth and our transition from a brick and mortar branch operation
to one more based on Internet, Call Center and Strategic Alliance mortgage
lending channels may distort some of our ratios and financial statistics and may
make period-to-period comparisons difficult. In light of our growth and our
transition, historical earnings and other financial statistics may be of little
relevance in predicting future performance. Additionally, the sensitivity of
Conventional Loans to interest rates and the effect of interest rates on the
volume of loan production and margins will affect period to period comparisons.

         We expect segment contributions to vary from period to period. In order
to demonstrate the effect that varying factors have on loan production, revenue
and profits, we have elected to show the results of our current business
segments. As described above, effective April 1, 1999, we changed the way we
manage our business from a product line basis to a distribution channel basis.
The following table shows the contribution to revenues and expenses and the loan
closings of each of our distribution channels for the three and nine months
ended September 30, 1998 and 1999:


                                                                   Page 29 of 45
<PAGE>   30



<TABLE>
<CAPTION>

                                                        For the Three-Month                        For The Nine-Month
                                                      Periods Ended September 30,             Periods Ended September 30,
                                                 ------------------------------------     -----------------------------------
                                                       1998                 1999               1998                 1999
                                                 ---------------      ---------------     ---------------     --------------
                                                                                (In thousands)
<S>                                                 <C>                <C>                  <C>                <C>
REVENUES:
     Web/Call Center .........................      $ 2,612.4          $ 3,668.0            $ 8,629.2          $ 10,640.6
     Branch Network ..........................       20,609.0            7,481.9             55,823.7            36,850.9
     Strategic Alliance
         Program .............................                           1,479.9                                  2,537.2
     Other ...................................         (117.2)             (68.6)              (332.9)             (477.6)
     Eliminations.............................                            (299.6)                                  (554.8)
                                                    ---------          ---------            ---------          ----------
                                                     23,104.2           12,261.6             64,120.0            48,996.3

EXPENSES:
     Web/Call Center .........................        2,072.4            4,541.7              6,164.5            10,264.0
     Branch Network...........................       12,089.0            4,760.9             34,306.5            23,117.5
     Strategic Alliance
         Program .............................                           1,677.2                                  3,017.6
     Other ...................................        3,314.4            8,360.7              8,811.4            16,658.0
     Eliminations.............................                            (299.6)                                  (554.8)
                                                    ---------          ---------            ---------          ----------
                                                     17,475.8           19,040.9             49,282.4            52,502.3

Income (loss) before taxes and
     minority interest .......................        5,628.4           (6,779.3)            14,837.6            (3,506.0)
Minority interest ............................                              59.2                                    144.1
Income tax (expense) benefit
due to quarterly earnings (loss) .............       (1,501.0)           2,419.2             (2,624.5)            1,210.0
Income tax  benefit due to
Conversion of S. Corp. .......................                                                  950.9
                                                    ---------          ---------            ---------          ----------
Net income (loss) before taxes and
minority interest ............................      $ 4,127.4          $(4,300.9)           $13,164.0          $ (2,151.9)
                                                    =========          =========            =========          ==========

Provision for pro forma
     income tax ..............................        1,969.9                                 5,193.1
                                                    ---------                               ---------
Pro forma net income .........................      $ 3,658.5                               $ 9,644.5
                                                    =========                               =========

LOAN CLOSINGS:
    Web/Call Center ..........................      $  57,893          $ 113,980          $   126,045          $  348,553
    Branch Network ...........................        526,152            209,459            1,451,211           1,016,771
    Strategic Alliance Program ...............         56,085                                                     112,982
                                                    ---------          ---------          -----------          ----------
      Total Loan Closings ....................      $ 584,045          $ 379,524          $ 1,577,256          $1,478,306
                                                    =========          =========          ===========          ==========

</TABLE>

                                                                   Page 30 of 45
<PAGE>   31


THREE MONTHS ENDED SEPTEMBER 30, 1999
         VERSUS THREE MONTHS ENDED SEPTEMBER 30, 1998

         Revenues decreased in the third quarter of 1999 compared to the third
quarter of 1998 and the contribution by distribution channel differed from
quarter to quarter. In the third quarter of 1999, the Branch Network division
contributed $7.5 million, or 61.0%, of revenues, compared to $20.6 million, or
89.2%, in the third quarter of 1998. The Web/Call Center division contributed
$3.7 million, or 29.9%, of revenues, compared to $2.6 million, or 11.3%, in the
third quarter of 1998. The Strategic Alliance Program, which commenced
operations in April of 1999, contributed $1.5 million, or 12.1%, of revenues in
the third quarter of 1999.

         BRANCH NETWORK: The Branch Network division generated $7.5 million in
revenue in the third quarter of 1999 versus $20.6 million of revenue in the
third quarter of 1998. The 63.7% decrease in revenue is mainly attributable to a
decrease in margins earned on loan fees and gains on sale of Sub-Prime Loans and
Conventional Loans originated by the Branch Network in the third quarter of 1999
(see "Results of Operations" for a description of changes in margins), and a
52.7% decrease in sales of Branch Network loans in the third quarter of 1999
compared to the third quarter of 1998. The lower loan sales are primarily
attributable to the following:

     --   a 60.2% decrease in Branch Network loan closings, as a result of
          an increase in interest rates and a corresponding decrease in the
          volume of refinance activity, along with the shift of some Branch
          Network loan officers to the Web/Call Center; and
     --   the closing of 25 branches and one marketing center in 1999;

partially offset by the sale of $32.4 million more Branch Network loans in the
third quarter of 1999 than were disbursed, compared to $9.3 million fewer in the
third quarter of 1998.

Due to the branch closings and the continuing increase in interest rates further
dampening the amount of refinance business, we expect both closings and revenues
from our Branch Network to decline in the fourth quarter of 1999 from third
quarter of 1999.

         Direct expenses of the Branch Network division were $4.8 million in the
third quarter of 1999 compared to $12.1 million in the third quarter of 1998.
The $7.3 million decrease in direct expenses is primarily attributable to:

     --   a $4.7 million decrease in salaries, commissions and employee
          benefits, as a result of decreased origination volumes, the closing of
          25 branches and one marketing center in 1999, as well as a shift in
          product mix to more Conventional Loans, which have lower commissions;
     --   a decrease in marketing and advertising from $2.3 million in the third
          quarter of 1998 to $0.5 million in the third quarter of 1999. The
          decrease is primarily


                                                                   Page 31 of 45
<PAGE>   32


          attributable to discontinuing advertising for branches closed in 1999,
          compared to advertising for new branches in 1998;
     --   a $0.7 million decrease in occupancy costs from $1.2 million in the
          third quarter of 1998 to $0.5 million in the third quarter of 1999, as
          a result of branches closed during 1999; and
     --   a decrease in variable expenses directly associated with closed loans.

         WEB/CALL CENTER DIVISION: The Web/Call Center division generated $3.7
million in revenue in the third quarter of 1999 versus $2.6 million of revenue
in the third quarter of 1998. The 40.4% increase in revenue is mainly
attributable to a 119.6% increase in the volume of loans sold ($116.4 million in
the third quarter of 1999 compared to $53.0 million in the third quarter of
1998) as a result of a 96.9% increase in Web/Call Center originations ($114.0
million in the third quarter of 1999, compared to $57.9 million in the third
quarter of 1998) and the sale of $1.6 million more loans than were disbursed in
the third quarter of 1999, compared to $3.3 million fewer in the third quarter
of 1998, partially offset by reduced margins resulting from a change in products
originated, from High LTV Loans in 1998 to primarily Conventional Loans in 1999.
(see "Results of Operations" for a description of volumes and margins).

         We anticipate the increasing interest rates that started to occur in
the second quarter of 1999 will decrease the demand for loans that refinance the
existing mortgages of consumers. The decrease in production is expected to
reduce the profitability of the division in the fourth quarter of 1999.

         Direct expenses of the Web/Call Center division were $4.5 million in
the third quarter of 1999 compared to $2.1 million in the third quarter of 1998.
The 119.2% increase in expenses is primarily attributable to the following:

     --   a $0.6 million increase in commissions associated with a 96.9%
          increase in the volume of closed Web/Call Center loans;
     --   $0.9 million of increased marketing expenses in an attempt to brand
          RockLoans.com for the transition to the Web/Call Center origination
          platform; and
     --   increased expenses for personnel costs and occupancy for the
          anticipated growth in our Internet production; and
     --   increased variable expenses that fluctuate with the volume of loans
          closed.

         STRATEGIC ALLIANCE PROGRAM: Our Strategic Alliance Program currently
consists of one joint venture, a 70%-owned limited liability company that
originates residential mortgage products to Michigan National Bank's customers
through Michigan National Bank's 192 financial centers, a call center and over
the Internet. Michigan National Bank has approximately 450,000 customers and
owns the other 30% of the joint venture. The Strategic Alliance Program, which
commenced operations April 4, 1999, generated $1.5 million in revenue on loan
sales of $60.8 million in the third quarter of 1999.

         Direct  expenses of the Strategic  Alliance  Program were $1.7 million
in the third quarter of 1999 before intercompany eliminations.


                                                                   Page 32 of 45
<PAGE>   33

         OTHER: The majority of the Other revenue in the third quarter of 1999
is the fee charged to the joint venture for services rendered by Rock Financial
in accordance with the services agreement, which is eliminated in consolidation.

         Other expenses include expenses not directly allocable to a particular
division, such as the costs associated with our legal, marketing, accounting,
information services, facilities management, servicing, executive, human
resources, secondary marketing and general and administrative support teams. The
majority of the $5.1 million increase in expenses, from $3.3 million in the
third quarter of 1998 to $8.4 million for the third quarter of 1999, is
primarily due to one time charges of $3.5 million for branch closings in the
third quarter and $0.8 million in corporate relocation expenses (the majority of
which is the recognition of the impaired value of long-lived assets) and
increased costs of technology, marketing and other support personnel for our
Web/Call Center.


NINE MONTHS ENDED SEPTEMBER 30, 1999
         VERSUS NINE MONTHS ENDED SEPTEMBER 30, 1998

         Revenues decreased in the first nine months of 1999 compared to first
nine months of 1998 and the contribution by distribution channel differed from
quarter to quarter. In the first nine months of 1999, the Branch Network
division contributed $36.9 million, or 75.2%, of revenues, compared to $55.8
million, or 87.1%, in the first nine months of 1998. The Web/Call Center
division contributed $10.6 million, or 21.7%, of revenues, compared to $8.6
million, or 13.5%, in the first nine months of 1998. The Strategic Alliance
Program, which commenced operations in April of 1999, contributed $2.5 million,
or 5.2%, of revenues in the first nine months of 1999.

         BRANCH NETWORK: The Branch Network division generated $36.9 million in
revenue in the first nine months of 1999 versus $55.8 million of revenue in the
first nine months of 1998. The 34.0% decrease in revenue is mainly attributable
to a decrease in margins earned on loan fees and gains on sale of Sub-Prime
Loans originated in the Branch Network in the first nine months of 1999 (see
"Results of Operations" for a description of changes in margins). The decrease
was partially offset by our sale of $118.4 million more Branch Network loans in
the first nine months of 1999 than were disbursed, compared to $15.7 million
more in the first nine months of 1998. This increase was substantially offset by
a 29.9% decrease in Branch Network loan closings in the first nine months of
1999 as compared to the first nine months of 1998. The lower loan closings are a
result of an increase in interest rates and corresponding decrease in the volume
of refinance activity, along with the shift of some loan officers to the
Web/Call Center and the closing of 25 branches and one marketing center in 1999.
Due to the branch closings and the continuing increase in interest rates further
dampening the amount of refinance business in the third quarter of 1999, we
expect both closings and revenues from our Branch Network to continue to decline
in the fourth quarter of 1999 from the third quarter of 1999 level.


                                                                   Page 33 of 45
<PAGE>   34

         Direct expenses of the Branch Network division were $23.1 million in
the first nine months of 1999 compared to $34.3 million in the first nine months
of 1998. The $11.2 million decrease in expenses is primarily attributable to:

         --    a $ 4.7 million decrease in salaries, commissions and employee
               benefits, as a result of decreased origination volumes, the
               closing of 25 branches and one marketing center in 1999, as well
               as a shift in product mix to more Conventional Loans, which have
               lower commissions;
         --    a $2.3 million decrease in marketing expense, primarily
               attributable to discontinuing advertising for branches closed in
               1999, compared to advertising for new branches in 1998;
         --    a $0.9 million decrease in occupancy costs from $3.4 million in
               the third quarter of 1998 to $2.5 million in the third quarter of
               1999, as a result of branches closed during 1999; and
         --    a decrease in variable expenses directly associated with closed
               loans.

         WEB/CALL CENTER DIVISION: The Web/Call Center division generated $10.6
million in revenue in the first nine months of 1999 versus $8.6 million of
revenue in the first nine months of 1998. The 23.3% increase in revenue is
mainly attributable to a 189.3% increase in loan sales (see "Results of
Operations" for a description of volumes and margins) as a result of a $222.5
million increase, or 176.5%, in Web/Call Center originations and the sale of
$3.7 million more loans than were disbursed in the first nine months of 1999,
compared to $2.2 million fewer in the first nine months of 1998, partially
offset by reduced margins resulting from a change in products originated, from
High LTV Loans in 1998 to primarily Conventional Loans in 1999. We anticipate
the increasing interest rates that started to occur in the third quarter of 1999
will decrease the refinancing of existing mortgages by consumers. The decrease
in production is expected to reduce the profitability of the division in the
fourth quarter of 1999.

         Direct expenses of the Web/Call Center division were $10.3 million in
the first nine months of 1999 compared to $6.2 million in the first nine months
of 1998. The 66.5% increase is primarily attributable to the following:

         --    a $1.5 million increase in commissions associated with a 176.5%
               increase in the volume of closed Web/Call Center loans;
         --    $0.9 million of increased marketing expenses in an attempt to
               brand RockLoans.com for the transition to the Web/Call Center
               origination platform; and
         --    increased expenses for personnel costs and occupancy for the
               anticipated growth in our Internet production; and
         --    increased variable expenses that fluctuate with the volume of
               loans closed.

         STRATEGIC ALLIANCE PROGRAM: Our Strategic Alliance Program currently
consists of one joint venture, a 70%-owned limited liability company that
originates residential mortgage products to Michigan National Bank's customers
through Michigan National Bank's 192 financial centers, a call center and over
the Internet. Michigan National Bank has approximately 450,000 customers and
owns the other 30% of the joint venture. The Strategic




                                                                   Page 34 of 45
<PAGE>   35

Alliance Program, which commenced operations April 4, 1999, generated $2.5
million in revenue on loan sales of $105.5 million in the first nine months of
1999.

         Direct expenses of the Strategic Alliance Program were $3.0 million in
the first nine months of 1999 before intercompany eliminations.

         OTHER: The majority of the Other revenue in the first nine months of
1999 is the fee charged to the joint venture for services rendered by Rock
Financial in accordance with the services agreement, which is eliminated in
consolidation.

         Other expenses include expenses not directly allocable to a particular
division, such as the costs associated with our legal, marketing, accounting,
information services, facilities management, servicing, executive, human
resources, secondary marketing and general and administrative support teams. The
majority of the $7.9 million increase in expenses, from $8.8 million in the
first nine months of 1998 to $16.7 million for the first nine months of 1999, is
primarily due to one time charges of $3.5 million for branch closings in the
third quarter and $0.8 million in corporate relocation expenses (the majority of
which is the recognition of the impaired value of long-lived assets) and
increased costs of technology, marketing and other support personnel for our
Web/Call Center.

LIQUIDITY AND CAPITAL RESOURCES

         Net cash provided by operating activities in the first nine months of
1999 was approximately $85.1 million, compared to approximately $62.3 million in
the first nine months of 1998. Cash was provided primarily by:

     --   a decrease in mortgage loans held for sale of approximately $114.4
          million in the first nine months of 1999, compared to an approximately
          $17.1 million decrease in the first nine months of 1998; and
     --   our results of operation in the first nine months of 1999,
          approximately $2.2 million before depreciation and amortization,
          provision for credit losses, and deferred income taxes in the first
          nine months of 1999, compared to net income of approximately $13.5
          million in the first nine months of 1998.

These sources of cash were partially offset by the following:

     --   a decrease in drafts payable, which represent funds advanced for loan
          closings that have not yet been drawn against the warehouse line of
          credit of approximately $24.8 million in the first nine months of
          1999, compared to an increase of approximately $23.4 million in the
          first nine months of 1998;
     --   an increase in prepaid and federal income tax receivable of $4.0
          million in the first nine months of 1999, as a result of stock options
          exercised;
     --   a decrease in accounts payable and accrued expenses and other
          liabilities of approximately $2.6 million in the first nine months of
          1999, compared to an increase of approximately


                                                                   Page 35 of 45
<PAGE>   36

          $8.5 million in the first nine months of 1998, primarily as a result
          of the decrease in loan closings from the fourth quarter of 1998 to
          the third quarter of 1999.

         Net cash provided by investing activities during the first nine months
of 1999 was approximately $2.9 million, compared to approximately $4.2 million
used in investing activities during the first nine months of 1998. Cash was
primarily provided by a decrease in real estate owned and loans held for
investment of approximately $2.4 million in the first nine months of 1999 as a
result of the sale and repayment of loans in the third quarter of 1999, compared
to an increase of $1.3 million in the first nine months of 1998 and the
repayment of shareholders' advances of approximately $1.0 million in the first
nine months of 1999, compared to $1.6 million in the first nine months of 1998.
These uses of cash were partially offset by the purchase property and equipment
of approximately $0.5 million in the first nine months of 1999, compared to $4.6
million in the first nine months of 1998.

         Net cash used in financing activities during the first nine months of
1999 was approximately $81.0 million, compared to approximately $35.7 million
during the first nine months of 1998. Cash was used for the following:

     --   repayments of borrowings under our warehouse line of credit of
          approximately $76.8 million in the first nine months of 1999, compared
          to approximately $25.7 million in the first nine months of 1998;
     --   repayments of borrowings under our reverse repurchase agreement of
          approximately $11.5 million in the first nine months of 1999, compared
          to approximately $15.4 million in the first nine months of 1998; and
     --   payment of dividends to shareholders of approximately $0.6 million in
          the first nine months of 1999, compared to approximately $0.6 million
          in the first nine months of 1998. We determined not to pay a dividend
          in the third or fourth quarters of 1999.

These uses of cash were partially offset by the proceeds from the exercise of
stock options of approximately $7.6 million in the first nine months of 1999,
compared to $1.9 million in the first nine months of 1998, and $0.3 million
minority interest investment received from Michigan National Bank for our joint
venture in the first nine months of 1999. We normally use our cash to pay down
our warehouse borrowings. In order to demonstrate the availability of this
liquidity, we borrowed additional cash under our warehouse line of credit at
September 30, 1999 for three days.

         We have $450 million of warehouse financing facilities, which includes
a $50 million warehouse financing facility of our subsidiary, Rock Home Loans at
Michigan National. Our warehouse line of credit currently provides for up to
$200 million principal amount of demand loans secured by loans held for sale and
other of our assets. Loans under the warehouse line of credit bear interest at
rates that vary depending on the type of underlying loan, and the loans are
subject to sublimits, advance rates and warehouse terms that vary depending on
the type of underlying loan. The effective weighted average interest rate for
this arrangement in the first nine months of 1999 was 6.31%. As of November 11,
1999, we had financed $10.3 million of loans under this facility and had a
maximum of $26.3 million available for additional



                                                                   Page 36 of 45
<PAGE>   37

borrowings and were in compliance with all associated financial covenants. We
would have an additional $189.7 million of borrowing capacity available if we
had sufficient collateral.

         In addition to the $200 million warehouse line of credit, our reverse
repurchase arrangement provides that the lender, an affiliate of one of the
representatives of the underwriters in our initial public offering and our
financial advisor in connection with our merger with Intuit Inc., will purchase
from us at par up to $200 million of fully-amortizing, first or junior lien
residential mortgage loans and home equity loans that comply with our
origination guidelines and conform to whole and bulk loan sale requirements. The
lender's obligations are subject to our agreement to repurchase loans on a daily
basis. This agreement is not a committed facility and the lender may elect to
discontinue the repurchase agreement at any time. The term of any financing
under the repurchase agreement matures and may be renewed on a daily basis. In
any event, the arrangement terminates in March 2000. The effective weighted
average interest rate to us of this arrangement in the first nine months of 1999
was 5.92%. We use this facility as a supplemental borrowing facility to fund
loans we close until they are sold. As of November 3, 1999, we had not financed
any loans under this facility and had no additional borrowings available to draw
against. We would have an additional $200 million of borrowing capacity if we
had sufficient collateral.

         Our subsidiary, Rock Home Loans at Michigan National, has $50 million
of warehouse financing facilities. Its warehouse line of credit currently
provides for up to $50 million principal amount of demand loans secured by loans
held for sale and other of its assets. Loans under the warehouse line of credit
bear interest at rates that vary depending on the type of underlying loan, and
the loans are subject to sublimits, advance rates and warehouse terms that vary
depending on the type of underlying loan. The effective weighted average
interest rate for this arrangement for the six months ended September 30, 1999
was 6.20%. As of November 11, 1999, $8.6 million had been borrowed under this
facility and our subsidiary had no additional borrowings available to draw
against and was in compliance with all associated financial covenants. It would
have $41.4 million of borrowing capacity available if it had sufficient
collateral.

         Our warehouse financing facilities, together with cash flows from
operations, are expected to be sufficient to fund our liquidity requirements for
the next 12 months, if our future operations are consistent with our
expectations. We, however, expect that eventually we will need to arrange for
additional sources of capital through the issuance of debt, equity or additional
bank borrowings. We have no commitments for any such additional financing, and
we cannot assure you that we will be able to obtain any such additional
financing at the times required and on terms and conditions acceptable to us. In
such event, our growth and operations could be curtailed. If we begin to
securitize our assets or significantly increase our retained mortgage servicing
rights, our liquidity could be materially adversely affected, although we have
no current intention to do either in the immediate future.




                                                                   Page 37 of 45
<PAGE>   38

NEW ACCOUNTING STANDARDS NET YET ADOPTED

         In September 1998, the Financial Accounting Standards Board issued SFAS
No. 133, "Accounting for Derivative Instruments and Hedging Activities"
("Statement 133"). Statement 133 establishes accounting and reporting standards
for derivative instruments, including certain derivative instruments embedded in
other contracts, and for hedging activities. Statement 133 requires companies to
record derivatives on the balance sheet as assets or liabilities, measured at
fair value. Gains or losses resulting from changes in the values of those
derivatives would be accounted for depending on the use of the derivative and
whether it qualifies for hedge accounting. Upon initial application, hedging
relationships must be designated anew and documented pursuant to the provisions
of Statement 133.

         In June 1999, the Financial Accounting Standards Board issued SFAS No.
137, "Accounting for Derivative Instruments and Hedging Activities-Deferral of
the Effective Date of FASB Statement No. 133" ("Statement 137"). Statement 137
amends the effective date of Statement 133. Statement 133 will now be effective
for all fiscal quarters of all fiscal years beginning after June 15, 2000.
Management has not yet evaluated the impact of the implementation of Statement
133.

YEAR 2000 DISCLOSURE

STATE OF READINESS

         We have developed a Year 2000 project plan that addresses both
technological and non-technological systems, including embedded systems for all
business units. We have designated a Year 2000 project team to lead the efforts
using a phased approach. We employ both internal and external resources to
identify, correct and test systems to achieve Year 2000 compliance. We are also
reviewing the Year 2000 readiness of third parties that provide services
essential to our operations.

         The plan consists of nine phases. As of September 30, 1999, we have
completed all the phases which are planning, awareness, inventory, triage,
detailed assessment, resolution, test planning, testing and deployment. As a
result of the completion of these phases, we believe that we are Year 2000
compliant, however, there can be no guarantee until the event actually happens.
We also are continuing to communicate with key third party suppliers and other
business partners to establish and monitor their levels of Year 2000 readiness.
Our Year 2000 project is subject to modification, and we may revise it
periodically as we further develop information.

ESTIMATED COST

         As of September 30, 1999, we have incurred approximately $290,000 of
costs. As we are completed with all nine phases of our project, we do not expect
any further significant costs to be incurred in relation with this project. We
do not expect our Year 2000 project cost to have a material impact on our
liquidity or capital resources.






                                                                   Page 38 of 45

<PAGE>   39
RISKS OF OUR YEAR 2000 ISSUES

         Based on current information, we believe the Year 2000 problem will not
have a material adverse effect on us, our business or our financial condition.
We cannot predict the actual effect of the Year 2000 problem on us. Many
uncertainties exist as to whether broad-based or systemic economic failures may
occur.

YEAR 2000 CONTINGENCY PLANS

         We are reviewing existing contingency plans for potential modifications
to address specific Year 2000 issues. Our key operational systems are being
reviewed and strengthened to address business continuity requirements. Business
continuity plans include the development of back-up processes that would be
implemented in the event of system failures, for example, the ability to provide
government reporting manually versus electronically. The contingency planning
process will continue as the status of third party readiness becomes better
known.




                                                                   Page 39 of 45
<PAGE>   40


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         Interest rate risk is the largest market risk affecting us. Interest
rate risk is the possibility that changes in interest rates will cause
unfavorable changes in our net income and in the value of our interest rate
sensitive assets, liabilities and commitments. As part of our risk management
programs, we purchase financial instruments and enter into financial agreements
with off-balance sheet risk in the normal course of business to manage our
exposure to interest rate risk with respect to our Conventional Loans and our
government-insured loans (together, "Prime Loans"), but not with respect to our
Sub-Prime Loans or Home Equity Lines of Credit. We use these financial
instruments for the explicit purpose of managing interest rate risks to protect
the value of our Prime Loans held for sale and the Prime Loan commitment
pipeline. We use financial instruments that tend to decrease in value as
interest rates decline and increase in value as interest rates rise, which acts
as an offset to the behavior of the underlying Prime Loans held for sale and
Prime Loan pipeline.

         Management actively monitors and manages our exposure to interest rate
risk on Prime Loans, which is incurred in the normal course of business. The
committed and closed pipelines of Prime Loans, as well as the related forward
commitments and derivatives, are valued daily. We refer to the loans, pipeline,
commitments and derivatives together as the "hedge position". The hedge position
is "shocked" against a spectrum of interest rate scenarios to evaluate expected
net changes of the fair values of the hedge position in relation to the changes
in interest rates. We do not enter into instruments for trading purposes.

         We evaluate interest rate risk exposure using both static shock and
option adjusted spread models to estimate changes to the fair value of the hedge
position. Both modeling techniques measure net changes in the fair value to the
underlying assets and commitments by determining the present value of the cash
flow of the underlying mortgage or debt instrument discounted at the interest
rate assumed to be required by an investor to yield a market rate of return.
Both modeling techniques measure changes in the fair value of derivatives
through Option Adjusted Spread calculations to determine the present value using
implied volatility, discount rates and expected life of the derivative. Both
models use assumptions regarding the amount of commitments that close, given an
incremental shift of +/- 100 basis points, in 12.5 basis point increments, to
the yield curve. The assumptions are based on our historical experience. Our
exposure is analyzed daily and reviewed at least monthly by the Secondary
Marketing Executive Committee, which includes in its membership our Director of
Secondary Marketing, our Chief Financial Officer, our President, and our
Chairman of the Board and Chief Executive Officer.

         Both modeling techniques described above were applied to the hedge
position as of September 30, 1999 over a spectrum of interest rate changes to
evaluate the change in the hedge position's fair value ("sensitivity analysis").
Using the results of the model producing the largest loss in fair value, the
sensitivity analysis reflected that an instantaneous 50 basis point increase in
interest rates at September 30, 1999, determined by management to reflect a
reasonably possible near-term change, would have reduced the fair value of the
hedge position 17 basis points from 2.33% to 2.16% and would have decreased
revenue by approximately $140,000 even though the model assumes that more loans
would have closed due to an increase in interest rates. A 50 basis



                                                                   Page 40 of 45
<PAGE>   41
point decrease in interest rates at September 30, 1999, determined by management
to reflect a reasonably possible near-term change, would have decreased the fair
value of the hedge position 10 basis points from 2.33% to 2.23% and would have
decreased revenue by approximately $46,000 assuming that fewer loans would have
closed due to the decline in interest rates. Both 50 basis point moves are
assumed shifts in the entire yield curve. We do not believe that our spread
income would be materially affected by interest rate changes as the interest we
charge on our mortgage loans can change faster than the interest on our
indebtedness.

         The table below provides information about our other financial
instruments that are sensitive to changes in interest rates, including debt
obligations and Sub-Prime Loans, as of September 30, 1999. For both debt
obligations and Sub-Prime Loans, the table presents principal cash flows and
related weighted average interest rates by expected maturity dates. Weighted
average variable rates are based on current rates as of September 30, 1999. The
instruments' actual cash flows are all denominated in U.S. dollars.

<TABLE>
<CAPTION>

                                              SEPTEMBER 30, 1999
                                             EXPECTED MATURITY DATE
(AMOUNTS IN THOUSANDS)                     1999          2000-2003        THEREAFTER           TOTAL             FAIR VALUE
                                       ------------------------------------------------------------------------------------
<S>                                   <C>               <C>              <C>               <C>                  <C>
               ASSETS:

Sub-Prime Loans                        $  4,953            $ 0              $ 0              $ 4,953              $ 4,953
Weighted Average Interest Rate:          12.17%             NA               NA               12.17%

            LIABILITIES:

Warehouse Line of Credit               $ 21,236            $ 0              $ 0              $21,236              $21,236
Weighted Average Interest Rate:           6.26%             NA               NA                6.26%
Reverse Repurchase  Arrangement        $      0            $ 0              $ 0              $     0              $     0
Weighted Average Interest Rate:              NA             NA               NA                   NA                   NA
</TABLE>




                                                                   Page 41 of 45
<PAGE>   42



                           PART II--OTHER INFORMATION

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

         In general, under Chapter 7B of the Michigan Business Corporation Act,
an entity that acquires "Control Shares" of Rock may vote the Control Shares on
any matter only if a majority of all shares, and of all non-"Interested Shares",
of each class of shares entitled to vote as a class, approve such voting rights.
Interested Shares are shares owned by our officers, our employee-directors, and
the entity making the Control Share Acquisition. Control Shares are shares that
when added to shares already owned by an entity, would give the entity voting
power in the election of directors over any of the three thresholds: one-fifth,
one-third and a majority. The effect of the statute is to condition the
acquisition of voting control of a corporation on the approval of a majority of
the pre-existing disinterested shareholders.

         The Board of Directors may amend the bylaws before a Control Share
Acquisition occurs to provide that Chapter 7B does not apply to us. In
connection with the proposed merger with Intuit Inc., on October 5, 1999, the
Board of Directors amended our bylaws to provide that Chapter 7B does not apply
to Rock or its common shares, par value $0.01 per share.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)      Exhibits.

         2.1      Agreement and Plan of Merger, dated October 6, 1999, among
                  Intuit Inc., Rock Financial Corporation, Title Source, Inc.,
                  Merger Sub 1, Inc. and Merger Sub 2, Inc., incorporated by
                  reference to Exhibit 2.1 to Rock Financial Corporation's
                  Current Report on Form 8-K filed with the Securities and
                  Exchange Commission on October 22, 1999.
         3(ii)    Amended and restated bylaws of Rock Financial Corporation as
                  amended October 5, 1999.
         10.1     Form of Indemnification Agreement for Directors and Officers.
         10.2     Stock Option Agreement, dated October 6, 1999, between Intuit,
                  Inc. and Rock Financial Corporation, incorporated by reference
                  to Exhibit 99.1 to Rock Financial Corporation's Current Report
                  on Form 8-K filed with the Securities and Exchange Commission
                  on October 22, 1999.
         10.3     Form of Rock Voting Agreement, dated October 6, 1999, between
                  specified shareholders of Rock Financial Corporation and
                  Intuit Inc., incorporated by reference to Exhibit 99.2 to Rock
                  Financial Corporation's Current Report on Form 8-K filed with
                  the Securities and Exchange Commission on October 22, 1999.
         10.4     Form of Title Voting Agreement, dated October 6, 1999, between
                  specified shareholders of Title Source, Inc. and Intuit Inc.,
                  incorporated by reference to Exhibit 99.3 to Rock Financial
                  Corporation's Current Report on Form 8-K filed with the
                  Securities and Exchange Commission on October 22, 1999.
         10.5     Form of Rock Affiliate Agreement, dated October 6, 1999, among
                  deemed

                                                              Page 42 of 45
<PAGE>   43


                  affiliates of Rock Financial Corporation, Intuit Inc. and Rock
                  Financial Corporation, incorporated by reference to Exhibit
                  99.4 to Rock Financial Corporation's Current Report on Form
                  8-K filed with the Securities and Exchange Commission on
                  October 22, 1999.
         10.6     Form of Title Affiliate Agreement, dated October 6, 1999,
                  among deemed affiliates of Title Source, Inc., Intuit Inc. and
                  Title Source, Inc, incorporated by reference to Exhibit 99.5
                  to Rock Financial Corporation's Current Report on Form 8-K
                  filed with the Securities and Exchange Commission on October
                  22, 1999.
         10.7     Form of Intuit Affiliate Agreement, dated October 6, 1999,
                  between deemed affiliates of Intuit Inc. and Intuit Inc,
                  incorporated by reference to Exhibit 99.6 to Rock Financial
                  Corporation's Current Report on Form 8-K filed with the
                  Securities and Exchange Commission on October 22, 1999.
         10.8     Non-Competition Agreement, dated October 6, 1999, among Intuit
                  Inc., Rock Financial Corporation and Daniel Gilbert,
                  incorporated by reference to Exhibit 99.7 to Rock Financial
                  Corporation's Current Report on Form 8-K filed with the
                  Securities and Exchange Commission on October 22, 1999.
         10.9     Amendment No. 6 to Second Amended and Restated Mortgage
                  Warehousing Agreement dated August 27, 1999, among Rock
                  Financial Corporation, the lenders named therein, and
                  Comerica Bank, as agent.
         27.1     Financial Data Schedule.

                                                                   Page 43 of 45
<PAGE>   44


         (b)      Reports on Form 8-K.

                  The Company filed a Current Report on Form 8-K on October 22,
               1999, reporting in Item 5 that it had entered into the Agreement
               and Plan of Merger on October 6, 1999 with Intuit, Inc. See Note
               9 of the Notes to Consolidated Financial Statements in Part I of
               this report for a description of the agreement and the merger. No
               financial statements were filed with the Form 8-K.

                                                                   Page 44 of 45
<PAGE>   45




                                   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 thereunto duly authorized.

                                            ROCK FINANCIAL CORPORATION
                                                  (Registrant)

Date:  November 15, 1999                     By:/s/ MICHAEL D. HOLLERBACH
                                               ---------------------------------
                                                   MICHAEL D. HOLLERBACH
                                                   Its:  President
                                                   (Duly Authorized Officer)


Date:  November 15, 1999                     By:/s/ FRANK E. PLENSKOFSKI
                                               ---------------------------------
                                                   FRANK E. PLENSKOFSKI
                                                   Its:  Chief Financial Officer
                                                   (Principal Financial and
                                                    Chief Accounting Officer)



                                                                   Page 45 of 45

<PAGE>   46


                                  EXHIBIT INDEX

Exhibit           Description

2.1               Agreement and Plan of Merger, dated October 6, 1999, among
                  Intuit Inc., Rock Financial Corporation, Title Source, Inc.,
                  Merger Sub 1, Inc. and Merger Sub 2, Inc., incorporated by
                  reference to Exhibit 2.1 to Rock Financial Corporation's
                  Current Report on Form 8-K filed with the Securities and
                  Exchange Commission on October 22, 1999.
3(ii)             Amended and restated bylaws of Rock Financial Corporation as
                  amended October 5, 1999.
10.1              Form of Indemnification Agreement for Directors and Officers.
10.2              Stock Option Agreement, dated October 6, 1999, between Intuit,
                  Inc. and Rock Financial Corporation, incorporated by reference
                  to Exhibit 99.1 to Rock Financial Corporation's Current Report
                  on Form 8-K filed with the Securities and Exchange Commission
                  on October 22, 1999.
10.3              Form of Rock Voting Agreement, dated October 6, 1999, between
                  specified shareholders of Rock Financial Corporation and
                  Intuit Inc., incorporated by reference to Exhibit 99.2 to Rock
                  Financial Corporation's Current Report on Form 8-K filed with
                  the Securities and Exchange Commission on October 22, 1999.
10.4              Form of Title Voting Agreement, dated October 6, 1999, between
                  specified shareholders of Title Source, Inc. and Intuit Inc.,
                  incorporated by reference to Exhibit 99.3 to Rock Financial
                  Corporation's Current Report on Form 8-K filed with the
                  Securities and Exchange Commission on October 22, 1999.
10.5              Form of Rock Affiliate Agreement, dated October 6, 1999, among
                  deemed affiliates of Rock Financial Corporation, Intuit Inc.
                  and Rock Financial Corporation, incorporated by reference
                  to Exhibit 99.4 to Rock Financial Corporation's Current Report
                  on Form 8-K filed with the Securities and Exchange Commission
                  on October 22, 1999.
10.6              Form of Title Affiliate Agreement, dated October 6, 1999,
                  among deemed affiliates of Title Source, Inc., Intuit Inc. and
                  Title Source, Inc, incorporated by reference to Exhibit 99.5
                  to Rock Financial Corporation's Current Report on Form 8-K
                  filed with the Securities and Exchange Commission on October
                  22, 1999.
10.7              Form of Intuit Affiliate Agreement, dated October 6, 1999,
                  between deemed affiliates of Intuit Inc. and Intuit Inc,
                  incorporated by reference to Exhibit 99.6 to Rock Financial
                  Corporation's Current Report on Form 8-K filed with the
                  Securities and Exchange Commission on October 22, 1999.
10.8              Non-Competition Agreement, dated October 6, 1999, among Intuit
                  Inc., Rock Financial Corporation and Daniel Gilbert,
                  incorporated by reference to Exhibit 99.7 to Rock Financial
                  Corporation's Current Report on Form 8-K filed with the
                  Securities and Exchange Commission on October 22, 1999.
10.9              Amendment No. 6 to Second Amended and Restated Mortgage
                  Warehousing Agreement dated August 27, 1999, among Rock
                  Financial Corporation, the lenders named therein, and Comerica
                  Bank, as agent.
27.1              Financial Data Schedule.