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# U.S. Securities and Exchange Commission

# Washington, D.C. 20549

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# FORM 10-QSB

# [X] QUARTERLY REPORT UNDER SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGEACT OF 1934

For the quarterly period ended June 30, 2002

OR

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

# ACT OF 1934

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Commission File No. 0-8117

# CHURCH LOANS & INVESTMENTS TRUST

State of Organization - Texas

Internal Revenue Service  Employer
Identification No. 75-6030254

5305 I-40 West

Amarillo, Texas 79106

Registrants telephone number:
806-358-3666

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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 June 30, 2002,  7,000,806 shares of the  Registrants
shares of beneficial interest were outstanding.

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# CHURCH LOANS & INVESTMENTS TRUST
INDEX

|Part I.    |                                                                                             | Page
|---------- | ------------------------------------------------------------------------------------------- | ----
|Item 1:    | Financial Information:                                                                      |     
|           | Condensed Balance Sheets at June 30, 2002 and March 31, 2002                                | 1   
|           | Condensed Statements of Income for the three-month periods ended June 30, 2002 and 2001     | 2   
|           | Condensed Statements of Cash Flows for the three-month periods ended June 30, 2002 and 2001 | 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   

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# CHURCH LOANS & INVESTMENTS TRUST

(A Real Estate Investment Trust)
PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Condensed Balance Sheets (Unaudited)
June 30, 2002 and March 31, 2002

`ASSETS
                                                                                  June 30, 2002     March 31, 2002

CASH AND CASH EQUIVALENTS                                                       $         82,596   $         134,889

RECEIVABLES
     Mortgage loans and church bonds - performing                                     29,501,814          30,507,636
     Interim construction loans - performing                                          13,648,970          15,317,011
     Nonperforming mortgage loans, church bonds
         and interim construction loans                                                  887,707           1,151,907
     Less: Allowance for credit losses                                                (1,748,172)         (1,748,172)
                                                                                ----------------   -----------------
                                                                                      42,290,319          45,228,382
     Accrued interest receivable                                                         509,679             580,139
     Notes receivable                                                                    472,360             695,361
                                                                                ----------------   -----------------
                  Net receivables                                                     43,272,358          46,503,882
                                                                                ----------------   -----------------
PROPERTY AND EQUIPMENT, net                                                              131,012             134,931

REAL ESTATE ACQUIRED THROUGH FORECLOSURE                                               1,507,959           1,256,298

OTHER ASSETS                                                                              17,301              30,716
                                                                                ----------------   -----------------
TOTAL ASSETS                                                                    $     45,011,226   $      48,060,716
                                                                                ================   =================
                                                 LIABILITIES AND SHAREHOLDERS' EQUITY

LIABILITIES
     Notes payable and line of credit:
         Related parties                                                        $      2,665,923   $       3,616,397
         Other                                                                        20,362,509          22,238,158
                                                                                ----------------   -----------------
                                                                                      23,028,432          25,854,555
     Accrued interest payable                                                             97,503              43,784
     Federal income tax payable                                                               -               73,810
     Other                                                                               831,115             962,095
                                                                                ----------------   -----------------
                  Total liabilities                                                   23,957,050          26,934,244
                                                                                ----------------   -----------------
SHAREHOLDERS' EQUITY
     Shares of beneficial interest, no par value; authorized
         shares unlimited, 7,007,402 shares issued                                    20,623,866          20,623,866
     Undistributed net income                                                            446,800             519,096
     Treasury shares, at cost (6,596 shares)                                             (16,490)            (16,490)
                                                                                ----------------   -----------------
                  Total shareholders' equity                                          21,054,176          21,126,472
                                                                                ----------------   -----------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                      $     45,011,226   $      48,060,716
                                                                                ================   =================`

These condensed financial statements should be read
only in  connection  with  the  accompanying  notes to  condensed  financial
statements.
-1-

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# CHURCH LOANS & INVESTMENTS TRUST

(A Real Estate Investment Trust)

Condensed Statements of Income (Unaudited)
Three-month periods ended
June 30, 2002 and 2001

`Three-month periods ended June 30,
                                                                                        2002               2001
                                                                                ------------------  ---------------

INTEREST INCOME AND FEES
     Interest and fees on mortgage loans, church bonds
       and interim construction loans                                              $    1,113,557   $     1,550,000
     Interest on temporary investments                                                     64,702            19,203
                                                                                ------------------  ---------------
                  Total interest income and fees                                        1,178,259         1,569,203

INTEREST EXPENSE                                                                          230,559           314,590
                                                                                ------------------  ---------------
                  Net interest income                                                     947,700         1,254,613

PROVISION FOR POSSIBLE CREDIT LOSSES                                                         -               45,000
                                                                                ------------------  ---------------
                  Net interest income less provision for
                    possible credit losses                                                947,700         1,209,613
                                                                                ------------------  ---------------
OTHER INCOME                                                                               13,317             8,071

OTHER OPERATING EXPENSES
     General and administrative                                                           178,540           181,136
     Board of Trust Managers' fees                                                         14,222            13,692
                                                                                ------------------  ---------------
                  Total other operating expenses                                          192,762           194,828
                                                                                ------------------  ---------------
                  Income before provision for income taxes                                768,255         1,022,856

PROVISION FOR INCOME TAXES                                                                    454               481
                                                                                ------------------  ---------------
NET INCOME                                                                      $         767,801   $     1,022,375
                                                                                =================   ===============
WEIGHTED AVERAGE NUMBER
     OF SHARES OUTSTANDING                                                              7,000,806         7,000,806
                                                                                =================   ===============
NET INCOME PER SHARE                                                                      $.11            $.15
                                                                                          ====            ====
DIVIDENDS PER SHARE                                                                       $.12            $.10
                                                                                          ====            ====`

These condensed financial statements should be read
only in  connection  with  the  accompanying  notes to  condensed  financial
statements.
-2-

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# CHURCH LOANS & INVESTMENTS TRUST

(A Real Estate Investment Trust)
Condensed Statements of Cash Flows (Unaudited)
Three-month periods ended June 30, 2002 and 2001

`Three-month periods ended June 30,
                                                                                          2002             2001
                                                                                   --------------   ---------------
CASH FLOWS FROM OPERATING ACTIVITIES
     Net income                                                                    $      767,801     $   1,022,375
     Adjustments to reconcile net income to net cash
       provided by operating activities:
         Depreciation                                                                       3,919             3,919
         Amortization of loan discounts                                                    (7,269)         (238,238)
         Provision for possible credit losses                                                 -              45,000
         Changes in:
           Accrued interest receivable                                                     70,460           (15,661)
           Accrued interest payable                                                        53,719           (54,044)
           Other liabilities                                                             (130,980)          (16,092)
           Federal income tax payable                                                     (73,810)              -
           Other, net                                                                      13,415            (5,922)
                                                                                   --------------   ---------------
                  Net cash provided by operating activities                               697,255           741,337
                                                                                   --------------   ---------------
CASH FLOWS FROM INVESTING ACTIVITIES
     Investment in mortgage and interim construction
       loans and church bonds                                                          (4,807,488)       (3,666,286)
     Payments received on mortgage and interim
       construction loans and church bonds                                              7,501,159         5,675,295
     Investments in notes receivable                                                      (22,051)         (205,200)
     Payments received on notes receivable                                                245,052           141,392
                                                                                   --------------   ---------------
                  Net cash provided by investing activities                             2,916,672         1,945,201
                                                                                   --------------   ---------------
CASH FLOWS FROM FINANCING ACTIVITIES
     Borrowings on notes payable                                                        7,086,356         3,983,761
     Principal payments on notes payable                                               (9,912,479)       (6,029,157)
     Cash dividends                                                                      (840,097)         (700,080)
                                                                                   --------------   ---------------
                  Net cash used by financing activities                                (3,666,220)       (2,745,476)
                                                                                   --------------   ---------------
                  Decrease in cash and cash equivalents                                   (52,293)          (58,938)

CASH AND CASH EQUIVALENTS AT
     BEGINNING OF PERIOD                                                                  134,889           113,142
                                                                                   --------------   ---------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                                         $       82,596   $        54,204
                                                                                   ==============   ===============
Supplemental disclosure of cash flow information

     Cash paid during the period for interest                                      $      176,840   $       368,634
                                                                                   ==============   ===============
     Real estate acquired through foreclosure                                      $      251,661   $          -
                                                                                   ==============   ===============`

These condensed financial statements should be read
only in  connection  with  the  accompanying  notes to  condensed  financial
statements.-3-

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# CHURCH LOANS & INVESTMENTS TRUST

(A Real Estate Investment Trust)
Notes to Condensed Financial Statements (Unaudited)

#### NOTE 1 - GENERAL

See Summary of Significant  Accounting  Policies 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.

#### NOTE 2 - WEIGHTED AVERAGE INTEREST RATES

Weighted  average  interest  rates and net interest  rate margins at June 30,
2002 and 2001, were as follows:

`Mortgage loan and                Total           Net interest
                                            church bond portfolio          indebtedness         rate margin
                                            ---------------------          ------------        ------------
         June 30, 2002                              9.06%                    3.75%                5.31%

         June 30, 2001                             10.23%                    5.75%                4.48%`

#### NOTE 3 - CONTRACTUAL MATURITIES

Scheduled principal payments on mortgage loans, church bonds and interim loans and indebtedness  (including notes payable)  outstanding
at June 30, 2002, for the five twelve-month periods subsequent to June 30, 2002,
follow:

`Twelve-month period                    Mortgage loans, church bonds
                       ending June 30,                           and interim loans             Indebtedness
                     -------------------                    ----------------------------     ---------------
                          2003                                 $    15,414,432               $    23,028,432
                          2004                                       1,507,631                        -
                          2005                                       1,591,029                        -
                          2006                                       1,635,920                        -
                          2007                                       1,678,112                        -`

-4-

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# CHURCH LOANS & INVESTMENTS TRUST

(A Real Estate Investment Trust)
Notes to Condensed Financial Statements (Unaudited)

#### NOTE 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 $887,707 and $4,276,828 at
June 30,  2002 and 2001,  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 $27,000 and $114,000 for the three-month periods
ended June 30, 2002 and 2001, respectively.  Interest income actually recognized
during  2002 and 2001 was  approximately  $16,000  and  $462,000,  respectively.
Interest  income  recognized  during  2001  includes  approximately  $408,000 of
interest collected on the pay-off of two nonaccrual loans.

#### NOTE 5 - NEW ACCOUNTING STANDARD

On April 1, 2002, the Trust adopted  Financial  Accounting  Standards  Board No.
141, Business Combinations, and Statement No. 142, Goodwill and Other Intangible
Assets.  The adoption of the new standards did not have an impact on the Trust's
financial statements.

This information is an integral part of the
accompanying condensed financial statements-5-

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# 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 Period Ended June 30, 2002 as Compared to
the Three-Month Period Ended June 30, 2001:

### Revenues

The Trust's revenues are derived from interest income earned on 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  $390,944  for  the
three-month period ended June 30, 2002, as compared to the corresponding  period
in  2001,  is  primarily  due  to  the  Trust  receiving  full  payment  on  two
nonperforming loans during 2001 as discussed below.

During the quarter ended June 30, 2001, the Trust received $1,730,776 in full
and final  payment of a loan owing to the Trust.  Such  amount  paid in full the
principal and interest  owing to the Trust by such Borrower on May 11, 2001. The
loan had been  accounted  for as a  nonperforming  loan by the Trust and certain
interest  payments  had been  credited  to  principal.  Therefore,  the  pay-off
resulted in additional  recognition of interest income of approximately $146,900
during May 2001.

In  addition,  during the quarter  ended June 30,  2001,  the Trust  received
$490,000  in full and final  payment of a loan owing to the Trust.  Such  amount
paid in full the principal  and interest  owing to the Trust by such Borrower on
May 18, 2001.  The loan had been  accounted for as a  nonperforming  loan by the
Trust and certain interest  payments had been credited to principal.  Therefore,
the  pay-off   resulted  in  additional   recognition  of  interest   income  of
approximately $262,000 during May 2001.

At  June  30,  2002  and  2001,   performing  loans  and  church  bonds  were
approximately $43,151,000 and $36,683,000, respectively, and the average rate of
return was 9.06% at June 30, 2002 and 10.23% at June 30, 2001.

### Interest Expense

The most  significant  expense item is interest  expense which  comprised the
majority of total operating  expense for each of the  three-month  periods ended
June 30,  2002 and 2001.  The  decrease  of  approximately  $84,000 in  interest
expense resulted primarily from a decrease in the weighted average interest rate
on all indebtedness from 5.75% at June 30, 2001 to 3.75% at June 30, 2002.

### New Accounting Standard

On April 1, 2002, the Trust adopted Financial  Accounting Standards Board No.
141, Business Combinations,  and Statement No. 142, Goodwill and Other
Intangible Assets.  The adoption of the new standards did not have an impact
on the Trust's financial statements.

-6-

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# CHURCH LOANS & INVESTMENTS TRUST

(A Real Estate Investment Trust)

# 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

-7-

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# CHURCH LOANS & INVESTMENTS TRUST

SIGNATURES

(A Real Estate Investment Trust)

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

|By | /s/ B. R. McMorries
         ______________________________
                 B. R. McMorries, Chairman | Dated: August 14, 2002 | 
|-- | ------------------------------------------------------------------------------------------------------ | ---------------------- | 

|By | /s/ Kelly Archer
         ______________________________
                 Kelly Archer
                 Chief Financial Officer | Dated: August 14, 2002 | 
|-- | ------------------------------------------------------------------------------------------------------------------------------- | ---------------------- | 

-8-

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