================================================

                    U.S. Securities and Exchange Commission

                             Washington, D.C. 20549

                                   ----------

                                  FORM 10-QSB

                     [x] QUARTERLY REPORT UNDER SECTION 13
                      OR 15(d) OF THE SECURITIES EXCHANGE
                                  ACT OF 1934
                For the quarterly period ended December 31, 1995

                                       OR

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

                                   ----------


                           Commission File No. 0-8117



                        CHURCH LOANS & INVESTMENTS TRUST



State of Organization                                IRS Employer Identification
---------------------                                ---------------------------
      Texas                                                 No. 75-6030254

                                 5305 I-40 West
                             Amarillo, Texas 79106


                  Registrant's telephone number: 806-358-3666


                                   ----------


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

                               Yes [ X ] No [ _ ]


     As of December 31, 1995,  7,007,402 shares of the  Registrant's  shares of
beneficial interest were outstanding.

     Transitional Small Business Disclosure Format (check one)

                               Yes [ _ ] No [ X ]

<PAGE>

                        CHURCH LOANS & INVESTMENTS TRUST



                                     INDEX


                                                                     Page
                                                                     ----
        Part I.

             Item 1:  Financial Information:

                      Condensed Balance Sheets at December 31, 1995
                          and March 31, 1995 .......................   1

                      Condensed Statements of Income for the
                          three-month periods ended December 31, 1995
                          and 1994 .................................   2

                      Condensed Statements of Cash Flows
                          for the nine-month periods ended 
                          December 31, 1995 and 1994 ...............   3

                      Notes to Condensed Financial Statements .....    4

             Item 2:  Management's Discussion and Analysis or 
                       Plan of Operation ..........................    6


        Part II.  Other Information ...............................    7

        Signatures ................................................    8

<PAGE>



                        CHURCH LOANS & INVESTMENTS TRUST
                        (A Real Estate Investment Trust)
                          PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
                      Condensed Balance Sheets (Unaudited)
                      December 31, 1995 and March 31, 1995

                  ASSETS                     DECEMBER 31, 1995    MARCH 31, 1995
                  ------                     -----------------    --------------

Cash and cash equivalents ......................   $    796,570    $    366,977

Receivables:

    Mortgage loans and church bonds -
     earning ...................................     21,714,720      25,676,746
    Interim construction loans - earning .......     10,225,599      10,148,958
    Nonearning mortgage loans, church bonds
     and interim construction loans ............      2,885,189       3,405,793
    Less: Allowance for possible credit losses .       (706,165)       (645,049)
                                                   ------------    ------------
                                                     34,119,343      38,586,448
                                                   ------------    ------------
    Accrued interest receivable ................        319,959         339,633
    Notes receivable ...........................        559,722         481,878
    Other receivables ..........................            482           2,576
                                                   ------------    ------------
                  Total receivables ............     34,999,506      39,410,535

Property and equipment, net of accumulated
    depreciation of $425,461 and $413,707
    at December 31, 1995 and March 31, 1995,
    respectively ...............................        232,881         244,635
Property held for investment ...................         83,714          83,714
Unamortized debt expense, net and other assets .        104,448          65,400
                                                   ------------    ------------
                                                   $ 36,217,119    $ 40,171,261
                                                   ============    ============
      LIABILITIES AND SHAREHOLDERS' EQUITY
      ------------------------------------
Liabilities:
    Notes payable and line of credit:
      Related party ............................   $  1,044,997    $    706,577
      Other ....................................      5,174,955      11,032,781
                                                   ------------    ------------
                                                      6,219,952      11,739,358
                                                   ------------    ------------
    Secured savings certificates:
      Related party ............................        485,692         665,375
      Other ....................................      6,501,709       6,118,356
                                                   ------------    ------------
                                                      6,987,401       6,783,731

    Dividends payable ..........................      1,681,776            --
    Accrued interest payable ...................         64,583          94,423
    Federal income taxes payable ...............           --             5,010
    Other ......................................        443,303         314,771
                                                   ------------    ------------
                                                     15,397,015      18,937,293
Shareholders' equity:
    Shares of beneficial interest, no par value;
     authorized shares unlimited, 7,007,402
     shares issued and outstanding .............     20,623,866      20,623,866
    Undistributed net income ...................        196,238         610,102
                                                   ------------    ------------
                  Total shareholders' equity ...     20,820,104      21,233,968
                                                   ------------    ------------
                                                   $ 36,217,119    $ 40,171,261
                                                   ============    ============

See accompanying notes to the condensed financial statements.

                                     - 1 -
<PAGE>


                        CHURCH LOANS & INVESTMENTS TRUST
                        (A Real Estate Investment Trust)
                   Condensed Statements of Income (Unaudited)
                    Three-month and nine-month periods ended
                           December 31, 1995 and 1994
<TABLE>
<CAPTION>
                                         Three-month periods ended   Nine-month periods ended
                                                December 31,                December 31,
                                              1995         1994         1995         1994
                                              ----         ----         ----         ----
<S>                                         <C>          <C>          <C>          <C>      
Interest income and fees:
    Interest and fees on mortgage
      loans, church bonds, and
      interim construction loans .......   $  974,030    1,086,364    3,173,394    3,300,658
    Interest on temporary
       investments .....................        9,763        2,964       28,631       13,541
                                           ----------   ----------   ----------   ----------
          Total interest income
              and fees .................      983,793    1,089,328    3,202,025    3,314,199
                                           ----------   ----------   ----------   ----------
Debt expense:
    Interest ...........................      237,881      340,676      860,739      979,202
    Amortization of:
       Registration cost ...............       10,541         --         10,541        9,250
       Commissions paid to brokers .....       12,600       17,169       36,441       51,666
                                           ----------   ----------   ----------   ----------
          Total debt expense ...........      261,022      357,845      907,721    1,040,118
                                           ----------   ----------   ----------   ----------
          Net interest income ..........      722,771      731,483    2,294,304    2,274,081
    Provision for possible
      credit losses ....................       22,500        7,500       62,500       22,500
                                           ----------   ----------   ----------   ----------
          Net interest income
            less provision for
            possible credit losses .....      700,271      723,983    2,231,804    2,251,581
Other income ...........................        2,950        3,265        8,850        9,253
Other operating expenses:
    General and administrative .........      105,259      127,579      381,967      379,736
    Board of Trust Managers' fees ......       10,124        9,298       30,182       29,168
                                           ----------   ----------   ----------   ----------
          Total other operating expenses      115,383      136,877      412,149      408,904
                                           ----------   ----------   ----------   ----------
          Net income ...................   $  587,838      590,371    1,828,505    1,851,930
                                           ==========   ==========   ==========   ==========
Weighted average number of
    shares outstanding .................    7,007,402    7,007,402    7,007,402    7,007,402
                                           ==========   ==========   ==========   ==========

Net income per share ...................   $      .08          .08          .26          .26
                                           ==========   ==========   ==========   ==========

Dividends declared per share ...........   $      .24          .25          .32          .34
                                           ==========   ==========   ==========   ==========
</TABLE>

See accompanying notes to condensed financial statements.

                                     - 2 -
<PAGE>


                        CHURCH LOANS & INVESTMENTS TRUST
                        (A Real Estate Investment Trust)
                 Condensed Statements of Cash Flows (Unaudited)
               Nine-month periods ended December 31, 1995 and 1994
                                                         Nine-month periods
                                                         ended December 31,
                                                         1995           1994
                                                         ----           ----
Cash Flows from Operating Activities:

    Net income ..................................   $  1,828,505      1,851,930
    Adjustments to reconcile net income to
      net cash provided by operating activities:
          Depreciation ..........................         11,754         11,754
          Amortization of debt expense ..........         46,982         60,916
          Provision for possible credit losses ..         62,500         22,500
          Amortization of loan discounts ........       (249,171)      (193,518)
          Changes in:
              Accrued interest receivable .......         19,674        (22,321)
              Accrued interest payable ..........        (29,840)        81,377
              Federal income taxes payable ......         (5,010)        (5,799)
              Other liabilities .................        128,532        205,667
          Other, net ............................            372         17,415
                                                    ------------    -----------
                  Net cash provided by
                   operating activities .........      1,814,298      2,029,921
                                                    ------------    -----------
Cash Flows from Investing Activities:
    Investment in mortgage and interim
       construction loans and church bonds ......     (9,274,875)   (15,560,353)
    Payments received on mortgage and
       interim construction loans and
       church bonds .............................     13,930,036     11,197,780
    Advances of notes receivable ................       (307,611)      (109,621)
    Payments received on notes receivable .......        229,767        206,384
                                                    ------------    -----------
                  Net cash provided (used)
                    by investing activities .....      4,577,317     (4,265,810)
                                                    ------------    -----------
Cash Flows from Financing Activities:
    Net proceeds from bank overdraft ............           --           83,226
    Sale of secured savings certificates ........      3,100,744      5,239,232
    Borrowings on notes payable .................      8,038,227     10,269,447
    Principal payments on:
       Secured savings certificates .............     (2,897,074)    (5,353,882)
       Notes payable ............................    (13,557,633)    (7,713,578)
    Registration costs of secured savings
       certificates .............................        (44,126)        (8,290)
    Commissions paid to broker on issuance
       of secured savings certificates ..........        (41,567)       (79,030)
    Cash dividends paid .........................       (560,593)      (630,667)
                                                    ------------    -----------
                  Net cash provided (used)
                    by financing activities .....     (5,962,022)     1,806,458
                                                    ------------    -----------
                  Increase (decrease) in
                    cash  and cash equivalents ..        429,593       (429,431)
Cash and cash equivalents at beginning of period         366,977        429,431
                                                    ------------    -----------
Cash and cash equivalents at end of period ......   $    796,570           --
                                                    ============    ===========
Supplemental disclosure of cash flow information:
    Cash paid during the period for interest ....   $    890,579        897,825
                                                    ============    ===========
See accompanying notes to condensed financial statements.

During  December 1995,  the Board of Trust  Managers  declared cash dividends of
$1,681,776  ($.24 per share) payable in January 1996.  During December 1994, the
Board of Trust Managers  declared cash dividends of $1,751,850  ($.25 per share)
payable in January 1995.

                                     - 3 -
<PAGE>




                        CHURCH LOANS & INVESTMENTS TRUST
                        (A Real Estate Investment Trust)
               Notes to Condensed Financial Statements (Unaudited)

(1)    GENERAL

       See Note 1 of Notes to Financial  Statements in the Trust's Annual Report
       on Form  10-KSB405  for a summary of the Trust's  significant  accounting
       policies.

       The  unaudited  condensed  financial   statements  included  herein  were
       prepared  from  the  books  of the  Trust in  accordance  with  generally
       accepted accounting principles and reflect all adjustments (consisting of
       normal  recurring  accruals)  which are,  in the  opinion of  management,
       necessary to a fair  statement of the results of operations and financial
       position for the interim  periods.  Such financial  statements  generally
       conform to the  presentation  reflected in the Trust's  Annual  Report to
       Shareholders.  The current  interim period reported herein is included in
       the fiscal year subject to independent  audit at the end of that year and
       is not  necessarily an indication of the expected  results for the fiscal
       year.

(2)    WEIGHTED AVERAGE INTEREST RATES

       Weighted average interest rates and net interest rate margins at December
       31, 1995, and March 31, 1995, were as follows:

                                   Mortgage loan and       Total    Net interest
                                 church bond portfolio indebtedness  rate margin
                                 --------------------- ------------ ------------
          December 31, 1995  ........    11.22             7.42          3.80
          March 31, 1995 ............    10.94             8.02          2.92

(3)    CONTRACTUAL MATURITIES

       Scheduled  principal payments on mortgage loans, church bonds and interim
       loans and indebtedness  (including secured savings certificates and notes
       payable)  outstanding  at December  31, 1995,  for the five  twelve-month
       periods subsequent to December 31, 1995, follow:

             Twelve-month period     Mortgage loans, church bonds
             ending December 31,          and interim loans         Indebtedness
             -------------------         ------------------         ------------
                 1996                        $13,785,531               8,574,080
                 1997                          1,955,679               3,512,948
                 1998                          1,817,368               1,120,325
                 1999                          1,427,419                   -
                 2000                          1,199,567                   -
                                             ===========              ==========

(4)    MORTGAGE LOANS, CHURCH BONDS AND INTERIM CONSTRUCTION LOANS

       Mortgage loans, church bonds and interim  construction loans on which the
       accrual of interest  had been  discontinued  amounted to  $2,885,189  and
       $3,136,330  at December 31, 1995 and 1994,  respectively.  If interest on
       these mortgage  loans,  church bonds and interim  construction  loans had
       been accrued as earned,  interest  and fees on loans in the  accompanying
       condensed statements of income would have been increased by approximately
       $235,000 and $134,000 for the nine-month  periods ended December 31, 1995
       and 1994, respectively.

                                      - 4
<PAGE>




                        CHURCH LOANS & INVESTMENTS TRUST
                        (A Real Estate Investment Trust)
               Notes to Condensed Financial Statements (Unaudited)

       Nonearning  assets  include  one  interim  construction  loan which had a
       principal  balance of  $1,400,977  at December 31, 1995.  The loan became
       delinquent  during the latter  part of 1994 and was placed on  nonaccrual
       status  and  all  accrued   interest   was   written-off.   The  loan  is
       collateralized  by a church  building and  management  believes  that the
       potential  loss,  if any, is  adequately  provided in the  allowance  for
       possible  credit  losses  at  December  31,  1995.  Management  initiated
       proceedings  to foreclose  the  collateral  securing such loan and during
       July 1995,  a  temporary  forbearance  agreement  and  financial  control
       agreement  was reached in which,  among other  things,  the  borrower has
       agreed to pay the Trust  $5,000  per week.  The  borrower  had  generally
       complied  with the terms of the agreement  through  December 31, 1995. If
       the terms are not  substantially  complied  with, the Trust will continue
       with foreclosure proceedings.

(5)    SECURED SAVINGS CERTIFICATES

       Secured  Savings  Certificates  (Certificates)  are  issued in amounts of
       $1,000 or more and have  single  maturity  dates from 30 days to 10 years
       from date of issue. With respect to an individual  certificate,  interest
       rate and  frequency of payment of interest  (either  monthly,  quarterly,
       semiannually,  annually or at maturity) are fixed at the time of issuance
       of the  Certificate.  Effective  July 18, 1994,  the Trust decided not to
       register  and was not able to sell  additional  Certificates  after  that
       date. However,  during April 1995, the Board of Trust Managers decided to
       register  $20,000,000 of Certificates on Form SB-2 and as of December 31,
       1995, such registration was effective and Certificates were being issued.

       Certificates  are secured under the terms of an indenture  that requires,
       among other things,  the pledge of mortgage notes  receivable  with total
       unpaid principal  amounts not less than 125% (100% for Certificates  sold
       in 1995) of the aggregate  principal amount of Certificates  outstanding.
       Due to the fluctuations in the amount of sales of Certificates as well as
       in the repayment of notes pledged to secure the  Certificates,  the Trust
       has on occasion failed to maintain the required ratio of pledged notes to
       outstanding  Certificates for a short period of time until the deficiency
       could  be  corrected.  The  indenture  trustee  has  been  aware of these
       temporary  technical  defaults and has not  declared a default  under the
       Indenture.  At December 31, 1995,  the Trust was in  compliance  with the
       requirement.

                                     - 5 -
<PAGE>






                        CHURCH LOANS & INVESTMENTS TRUST
                        (A Real Estate Investment Trust)

Item 2. Management's Discussion and Analysis or Plan of Operation

Results of Operations - Three-Month  and  Nine-Month  Periods Ended December 31,
1995 as Compared to the  Three-Month  and Nine-Month  Periods Ended December 31,
1994:

                                    REVENUES

The Trust's  revenues are derived from interest  income earned on mortgage loans
as well as, to a lesser degree,  interest  earned on church bonds and short-term
investments.  The decrease in the Trust's  revenues of $105,535 and $112,174 for
the three-month  and nine-month  periods ended December 31, 1995, as compared to
the  corresponding  periods in 1994 is  primarily  due to a decrease  in average
mortgage  loans,  church bonds and interim  construction  loans.  Loan  balances
decreased  from  $41,190,548 at December 31, 1994 to $34,825,508 at December 31,
1995. This more than offset an increase in the weighted averaged rates on loans.
The weighted  average rate on mortgage loans,  church bonds and interim loans at
December 31, 1995 and 1994 was 11.22% and 10.67%, respectively.

                                INTEREST EXPENSE

The most  significant  expense  item is interest  expense  which  comprised  the
majority of total  operating  expense for each of the three-month and nine-month
periods ended December 31, 1995 and 1994. Interest expense decreased by $102,795
and $118,463 for the three-month and nine-month periods ended December 31, 1995,
respectively,  as compared to the corresponding period in 1994, primarily due to
decreases in average debt balances.  The weighted  average  interest rate on all
indebtedness was 7.57% at December 31, 1994 as compared to 7.42% at December 31,
1995.

                                NONEARNING ASSETS

Nonearning  assets include one interim  construction  loan which had a principal
balance of $1,400,977 at December 31, 1995.  The loan became  delinquent  during
the latter  part of 1994 and was  placed on  nonaccrual  status and all  accrued
interest was written-off.  The loan is  collateralized  by a church building and
management  believes that the potential loss, if any, is adequately  provided in
the  allowance  for possible  credit  losses at December  31,  1995.  Management
initiated  proceedings to foreclose the collateral securing such loan and during
July 1995, a temporary forbearance agreement and financial control agreement was
reached in which,  among other things,  the borrower has agreed to pay the Trust
$5,000 per week.  The  borrower  had  generally  complied  with the terms of the
agreement through December 31, 1995. If the terms are not substantially complied
with, the Trust will continue with foreclosure proceedings.

                                    LIQUIDITY

Due to the cost of  registration  and of sales of Secured  Savings  Certificates
(Certificates),  the cost of these  funds are  normally  higher than the cost of
borrowing from bank sources or master notes. Therefore, the Trust decided not to
register  additional  Certificates  and the  Trust  was not  able to sell  these
Certificates  after July 18, 1994, and,  therefore,  did not have available this
source of funds to meet its liquidity  needs.  However,  during April 1995,  the
Board  of Trust  Managers  decided  to  register  on Form  SB-2  $20,000,000  of
Certificates.  As of December 31, 1995,  such  registration  was  effective  and
Certificates were being issued.

                                     - 6 -
<PAGE>


                        CHURCH LOANS & INVESTMENTS TRUST

                        (A Real Estate Investment Trust)

                           PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K:

(a)    Exhibits:  None.

(b)    Reports on Form 8-K:  None filed during the current quarter















                                     - 7 -
<PAGE>


                        CHURCH LOANS & INVESTMENTS TRUST

                                   SIGNATURES

In accordance  with the  requirements  of the Exchange Act, the  registrant  has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                                CHURCH LOANS & INVESTMENTS TRUST



DATE: February 5, 1996                           BY:/s/ B.R. McMorries
                                                   -----------------------------
                                                   B.R. McMorries,
                                                   Chairman of the Board of
                                                   Trust Managers


DATE: February 5, 1996                          BY:/s/ Kelly Archer
                                                   -----------------------------
                                                   Kelly Archer
                                                   Chief Financial Officer





                                      - 8 -