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                                  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, 1998

                                       OR

     [ ]  Transition report pursuant to Section 13 or 15(d) of the Securities
          Exchange Act of 1934

     For the transition period from

     Commission file number
                            ---------------------
               NYLIFE SFD Holding Inc. as Master Administrator For
          NAFCO Auto Trust-1, NAFCO Auto Trust-2, and NAFCO Auto Trust-3
             (Exact name of registrant as specified in its charter)

              Delaware                                  13-3475905
  (State or other jurisdiction                       (I.R.S. Employer
of incorporation or organization)                    Identification No.)

 51 Madison Avenue, New York, New York                     10010
 -------------------------------------                     -----
(Address of principal executive offices)                 (Zip Code)

Registrant's telephone number, including area code (212) 576-6456

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 [ ]

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                                TABLE OF CONTENTS


                                                                        Page No.
                                                                        --------
Part I       Financial Information

Item 1.      Financial Statements                                          3
Item 2.      Management's Discussion and Analysis of Financial
             Condition and Results of Operations Properties                3
Item 3.      Quantitative and Qualitative Disclosures About Market Risk    3

Part II      Other Information

Item 1.      Legal Proceedings                                             4
Item 2.      Changes in Securities                                         4
Item 3.      Defaults Upon Senior Securities                               4
Item 4.      Submission of Matters to a Vote of Security Holders           4
Item 5.      Other Information                                             4
Item 6.      Exhibits and Reports on Form 8-K                              4-5

Signatures                                                                 6


                                       2

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                                     PART I

Item 1.   Financial Statements

Not applicable.

Item 2.   Management's Discussion and Analysis of Financial Condition and
          Results of Operations

Not applicable.

Item 3.   Quantitative and Qualitative Disclosures About Market Risk

Not applicable.


                                       3

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                                     PART II

Item 1.   Legal Proceedings

None.

Item 2.   Changes in Securities

None.

Item 3.   Defaults on Senior Securities

None.

Item 4.   Submission of Matters to a Vote of Security Holders

None.

Item 5.   Other Information

A "NOTICE OF PURCHASE OF AUTO LOANS BY THE MASTER ADMINISTRATOR AND FINAL
PAYMENT TO THE INVESTOR CERTIFICATEHOLDERS OF 8.45% CERTIFICATES OF NAFCO
AUTO TRUST-1" dated August 5, 1998 has been issued by the Trustee, Bankers
Trust Company. Such notice states that pursuant to Section 11.01(b) of that
certain Amended and Restated Pooling and Servicing Agreement dated as of
August 1, 1994 among NAFCO Auto Funding, L.P. (now known as Auto Funding II,
L.P.), as Seller, NAFCO Inc. (now known as NYLIFE SFD Holding, Inc.), as
Master Administrator, Electronic Data Systems Corporation, as Servicer, and
Bankers Trust Company, as Trustee, that the Master Administrator will
purchase all Auto Loans from NAFCO Auto Trust-1 (the "Trust") as of July 31,
1998 (the "Purchase Date").

On August 20, 1998, the Master Administrator deposited the aggregate 
Principal Balance of all outstanding Auto Loans and all accrued interest 
through the Purchase Date into the Trust Collection Account. On such date, 
the Distribution Date immediately following the Purchase Date, the Trustee 
distributed such amounts in payment of the principal and accrued interest on 
the Investor Certificates to the Investor Certificateholders. The 
distribution to Investor Certificateholders on August 20, 1998 constituted 
the final payment of monies due and owing to Investor Certificateholders 
pursuant to the Trust.

This Quarterly Report on Form 10-Q should be read in conjunction with the
Company's Annual Report on Form 10-K for the year ended December 31, 1997.

Item 6.   Exhibits and Reports on Form 8-K

(a)       Exhibits

          The following reflects all applicable Exhibits required under Item 601
          of Regulation S-K;

          (99)   Additional Exhibits

          (99.1) Trust - 1

          Master Administrator Report dated August 20, 1998 for the Due
          Period beginning on May 1, 1998 and ending on July 31, 1998.

          (99.2) Trust - 2

          Master Administrator Reports dated (i) August 20, 1998 for the Due
          Period beginning on July 1, 1998 and ending on July 31, 1998, (ii)
          September 21, 1998 for the Due period beginning on August 1, 1998
          and ending on August 31, 1998, (iii) October 20, 1998 for the Due
          Period beginning on September 1, 1998 and ending on September 30,
          1998.

                                       4

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          (99.3) Trust - 3

          Master Administrator Reports dated (i) August 20, 1998 for the Due
          Period beginning on July 1, 1998 and ending on July 31, 1998, (ii)
          September 21, 1998 for the Due Period beginning on August 1, 1998
          and ending on August 31, 1998, (iii) October 20, 1998 for the Due
          Period beginning on September 1, 1998 and ending on September 30,
          1998.

(b)       Reports on Form 8-K

          The Compnay filed a report on Form 8-K dated August 31, 1998, which
          is incorporated by reference.  The contents of the report are as
          follows:

          Pursuant to a Consent and Settlement Agreement dated as of August
          31, 1998, among NYLIFE SFD Holding Inc. ("SFD Holding"), NYLIFE
          Depositary Corporation ("Depositary"), Electronic Data Systems
          Corporation ("EDS") and Bankers Trust Company (the "Trustee"), EDS
          resigned as Servicer of the NAFCO Auto Trust securitization program
          effective August 31, 1998.  Concurrently, American Lenders
          Facilities, Inc. ("ALFI") was appointed Successor Servicer of the
          program effective August 31, 1998.

          The Trustee and Duff & Phelps Credit Rating Co., the rating agency
          for the trusts, consented to the appointment.  As a routine
          consequence of the change in program servicers, Duff & Phelps has
          placed the NAFCO Auto Trust securities on the precautionary status
          of "Rating Watch-Down."  Duff & Phelps has informed SFD Holding
          that the appointment of ALFI as Successor Servicer, in and of
          itself, will not result in the downgrade or withdrawal of the
          current outstanding rating of the NAFCO Auto Trust securities.


                                       5

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                                   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 on November 6, 1998.



                            NYLIFE SFD Holding Inc., on behalf of
                            NAFCO Auto Trust-1, NAFCO Auto Trust-2, and
                            NAFCO Auto Trust-3


                            By:  NYLIFE Depositary Corporation
                                 General Partner

                                 By:  /s/ Kevin M. Micucci
                                      -----------------------------------
                                            Kevin M. Micucci
                                             Principal Executive Officer

                                   By:  /s/ Scott J. Drath
                                        -----------------------------------
                                            Scott J. Drath
                                             VP and Controller of the
                                             General Partner

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                                INDEX TO EXHIBITS

Exhibit No.                Description                                    Page #

99.1                       Master Administrator Reports                    8-31
                           for Trust - 1
99.2                       Master Administrator Reports                   32-67
                           for Trust - 2
99.3                       Master Administrator Reports                   68-103
                           for Trust - 3