SECURITIES AND EXCHANGE COMMISSION
                       Washington, D.C. 20549



                            Form 10-Q



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

         For the quarterly period ended March 31, 2005

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

         For the transition period from _________ to _________


                  Commission file number 000-32409


                       UNITED MORTGAGE TRUST


          (Exact Name of Registrant as Specified in its
                      Governing Instruments)

     (a Maryland trust)        (IRS Employer Identification
                                     Number 75-6496585)



                       5740 Prospect Avenue
                           Suite 1000
                       Dallas, Texas 75206
                         (214) 237-9305



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

                              7,037,283

Number of shares of Registrant's shares of beneficial interest outstanding as
of March 31, 2005.

                               (i)
<PAGE>


<Page>
PART I  -- FINANCIAL INFORMATION
<TABLE>
                           UNITED MORTGAGE TRUST
                        CONSOLIDATED BALANCE SHEETS
<Caption>
                                            March 31,        December 31,
                                              2005              2004
                                           ------------------------------
ASSETS                                     (unaudited)        (audited)
<S>                                        <C>              <C>
Cash and cash equivalents                  $  2,251,633     $  1,331,798

Mortgage investments:
  Residential mortgages
    and contracts for deed                    8,968,354       17,749,231
  Residential mortgages and contracts
    for deed foreclosed                       1,535,884          867,591
  Interim mortgages                          67,806,677       73,747,536
  Interim mortgages foreclosed                1,824,163        2,025,830
  Reserve for loan losses                    (1,160,798)        (921,500)
                                            -----------       ----------
Total mortgage investments, net              78,974,280       93,468,688

Line-of-credit receivable, affiliate         31,276,739       28,721,639
Accrued interest receivable                     404,923          630,531
Accrued interest receivable, affiliate        3,399,948        3,375,970
Receivable from affiliate                       386,848          379,298
Equipment, less accumulated depreciation
  of $5,497 and $4,612, respectively             16,815           17,700
Other assets                                  1,658,717        1,272,637
                                           ------------     ------------
Total Assets                               $118,369,903     $129,198,261
                                           ------------     ------------
LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
  Line-of-credit payable                   $  2,250,100     $ 12,030,000
  Distributions payable                         941,558          937,846
  Accounts payable and accrued
    liabilities                                 204,523           75,098
                                            -----------     ------------
Total Liabilities                             3,396,181       13,042,944
                                            -----------     ------------

Commitments and contingencies                    --               --

Shareholders' equity:
  Shares of beneficial interest; $.01 par
    value; 100,000,000 shares authorized;
    7,729,773 and 7,683,050 shares
    issued; 7,037,283 and 7,040,743
    outstanding, respectively                    77,298           76,831
  Additional paid-in capital                135,685,524      134,750,434
  Advisor's reimbursement                       397,588          397,588
  Cumulative distributions in excess
    of earnings                              (7,497,554)      (6,386,352)
                                            -----------     ------------
                                            128,662,856      128,838,501
  Less treasury stock, 692,490 and
     642,307 shares, respectively,
     at cost                                (13,689,134)     (12,683,184)
                                            -----------     ------------

Total Shareholders' Equity                  114,973,722      116,155,317
                                           ------------     ------------
Total Liabilities and Shareholders'
  Equity                                   $118,369,903     $129,198,261
                                           ------------     ------------
<FN>
See accompanying notes to consolidated financial statements.
</FN>
</Table>


                                -1-



<Page>
<TABLE>
                           UNITED MORTGAGE TRUST
                         CONSOLIDATED STATEMENTS OF INCOME
                                    (unaudited)

<CAPTION>
                                                Three Months Ended
                                                     March 31,
                                                2005          2004
                                             ------------------------
<S>                                         <C>             <C>
Revenues:
  Interest income                           $3,542,742      $3,304,618
                                            ----------      ----------
Expenses:
  Reserve and loss from sale of
    foreclosed properties                    1,378,540         249,331
  Interest expense                              23,985          27,375
  Loan servicing fee                            83,010          36,676
  Trust administration fee                     226,262         210,908
  General and administrative                   130,833         124,762
                                            ----------      ----------
                                             1,842,630         649,052
                                            ----------      ----------
Net income                                  $1,700,112      $2,655,566
                                            ==========      ==========
Net income per share of beneficial
  interest                                       $0.24           $0.38
                                            ==========      ==========

Weighted average shares outstanding          7,031,366       7,039,222
                                            ==========      ==========

Dividends declared per share of
  beneficial interest                            $0.40           $0.46
                                            ==========      ==========
<FN>
See accompanying notes to consolidated financial statements.
</FN>
</TABLE>

                                 -2-


<Page>
<TABLE>
                         UNITED MORTGAGE TRUST
                CONSOLIDATED STATEMENTS OF CASH FLOWS
                              (unaudited)
<CAPTION>
                                                 Three Months Ended
                                                       March 31,
                                                  2005          2004
                                              -------------------------

<S>                                          <C>            <C>
Operating Activities
  Net income                                  $ 1,700,112   $2,655,566
  Adjustments to reconcile net income
    to net cash provided by operating
    activities:
      Reserve and loss from sales of
        foreclosed properties                   1,378,540      249,331
      Depreciation                                    885          886
      Net amortization of discount on
        mortgage investments                        3,774       (8,464)
      Changes in assets and liabilities:
        Accrued interest receivable               201,630     (694,098)
        Other assets                             (386,080)    (106,931)
        Accounts payable and accrued
          liabilities                             129,425     (122,451)
          Net cash provided by (used in)      -----------    ---------
            operating activities:               3,028,286    1,973,839
                                              -----------    ---------
Investing Activities
  Investment in residential mortgages and
    contracts for deed                          (516,973)  (1,093,646)
  Principal receipts on residential
    Mortgages and contracts for deed             637,706    2,021,791
  Proceeds from the sale of mortgage loans,
    securitization                              7,275,598       --
  Investment in interim mortgage notes        (13,488,425) (14,693,985)
  Principal receipts on interim mortgage
    notes                                      19,204,189   15,480,959
  Line-of-credit receivable,
    Affiliate, net                             (2,555,100)  (7,795,009)
  Receivable from affiliate                        (7,550)    (370,070)
          Net cash provided by (used in)       ----------  -----------
          Investing activities:                10,549,445   (6,449,960)
                                              -----------   ----------
Financing Activities
  Proceeds from issuance of shares of
    beneficial interest                           935,557    1,154,080
  Purchase of treasury stock                   (1,005,950)    (640,710)
  Shares of beneficial interest redeemed            --        (582,660)
  Net borrowings (payments) on
    line-of-credit payable                     (9,779,900)   6,000,000
  Dividends                                    (2,807,603)  (3,224,684)
        Net cash provided by (used in)        -----------   ----------
          financing activities:               (12,657,896)   2,706,026
                                              -----------   ----------
Net increase(decrease)and cash equivalents        919,835   (1,770,095)

Cash and cash equivalents at
  beginning of period                           1,331,798    4,199,455
                                              -----------   ----------
Cash and cash equivalents at
  end of period                               $ 2,251,633   $2,429,360
                                              -----------   ----------

Supplemental cash flow information:
Interest paid                                 $    23,985   $   27,375
                                              -----------   ----------
<FN>
See accompanying notes to consolidated financial statements.
</FN>
</TABLE>

                                 -3-


<PAGE>
                            UNITED MORTGAGE TRUST
                Notes to Consolidated Financial Statements
                               March 31, 2005

1. Description of Business

The Company

United Mortgage Trust (the "Company") is a Maryland real estate investment
trust which qualifies as a real estate investment trust (a "REIT") under
federal income tax laws. The Company invests exclusively in first lien,
fixed rate mortgages secured by single-family residential property
throughout the United States ("Mortgage Investments") and in secured loans
to affiliated partnerships that (a) originate and acquire loans for the
acquisition and development of single-family home lots, which we refer to
as land development loans, and (b) enter into participation agreements
with single-family residential real estate developers which we refer to as
equity participations.  Such loans are originated by others to the
Company's specifications or to specifications approved by the Company.
Most, if not all, of such loans are not insured or guaranteed by a
federally owned or guaranteed mortgage agency.

The Company completed its public offering of securities in October 2003,
raising approximately $130,540,000 in net offering proceeds. In November
2003, the Company received a merger proposal from UMT Holdings, L.P., an
entity organized by persons that include some of the officers and owners of
the Company and UMT Advisors, Inc. (the "Advisor"). A committee comprised of
the Company's Independent Trustees is currently evaluating the proposal.

2. Basis of Presentation

The accompanying unaudited consolidated financial statements were prepared in
accordance with accounting principles generally accepted in the United States
of America for interim financial information and with the instructions to
Form 10-Q of Regulation S-X. They do not include all information and
footnotes required by accounting principles generally accepted in the United
States of America for complete consolidated financial statements. However,
except as disclosed herein, there has been no material change in information
disclosed in the notes to the consolidated financial statements for the year
ended December 31, 2004 included in the Company's 10-K filed with the
Securities and Exchange Commission. The interim unaudited consolidated
financial statements should be read in conjunction with those consolidated
financial statements. In the opinion of management, all adjustments
considered necessary for a fair presentation, consisting solely of normal
recurring adjustments, were made. Operating results for the three months
ended March 31, 2005 are not necessarily indicative of the results that may
be expected for the year ended December 31, 2005.

3. Line-of-Credit Payable

On November 8, 2004, with trustee approval, the Company entered into a three
year loan agreement with a $15 million revolving credit facility with a new
bank. The line-of-credit payable was collateralized by certain interim

                                  -4-



<Page>
mortgages. Interest on the outstanding balance accrues at prime plus 0.5% per
annum (6.00% at March 31, 2005). The outstanding balance on the line-of-
credit was $2,250,100 at March 31, 2005.

4. Related Party Transactions

a). Trust Agreement Fees: The Company has an Advisory Agreement with the
Advisor whereby the Advisor provides the Company with day-to-day
management and administrative services subject to the supervision and
review by the Trustees. In consideration for the services, the Company
paid the Advisors a trust administration fee of $226,000 and $211,000 for
the 2005 and 2004 quarters, respectively.  The fee was calculated as
1/12th of 1/2 of 1% paid monthly of the first $50,000,000 of income
producing assets and 1/12th of 1% of income producing assets in excess of
$50,000,000, paid monthly.

b). Rent paid and received between related parties: As of January 1, 2001
the Company's obligation under the terms of its lease agreement with SCMI
was assumed by its Advisor and no rent has been paid by the Company since
2000. For the quarters ended March 31, 2005 and 2004, rent expenses paid
by the Advisor and included as part of the trust administration fee was
$6,400 and $9,500, respectively.

c). Loan servicing fees paid to an affiliate: Under the terms of a
Mortgage Servicing Agreement with Prospect Service Corp., the Company
incurred loan servicing fees of $83,000 and $37,000 in the 2005 and 2004
quarters, respectively.

d). Purchasing Mortgage Investments from affiliates: The Company did not
purchase any residential mortgages or contracts for deed during the 2005
quarter, but did purchase $939,000 from South Central Mortgage, Inc. in
the 2004 quarter.  Below is a table of mortgage investment funding with
affiliates during the quarters:

Affiliated Company                 2005           2004
---------------------          -----------    -----------
UDF line-of credit             $10,655,000    $11,170,000
Ready America Funding          $ 3,725,000    $ 1,933,599
UMTH Lending                   $   724,000    $ 5,143,563
Capital Reserve Corp.          $   281,000    $   834,623
Ready Mortgage Corp.           $   389,000    $   723,417
REO Property Company           $    12,500    $   170,591

e). Salaries and wages now paid by the Advisor: Payroll expenses, although
paid by the Advisor and construed to be part of the trust administration
fees in 2005 and 2004 were approximately $41,000 and $33,000,
respectively.

f). SCMI Recourse Agreement: SCMI has agreed that, if the obligor on any
Residential Mortgage or Contract for Deed sold to the Company by SCMI or its
Affiliates, and that has had less than 12 payments made on it, defaults in
the making of any payment or other obligation thereon during the period
ending before the 12th payment after the Company bought that Residential
Mortgage or Contract for Deed, then SCMI shall buy that Mortgage

                                 -5-


<Page>
Investment from the Company or advance on a month to month basis, of all
lost interest, tax and insurance escrow payments, as well as any costs
incurred by it related to curing the default or obtaining title of the
property securing the defaulted obligation.

g.) Line-of-Credit Receivable, Affiliate:  On January 1, 2005, but effective
September 30, 2004, the Company entered into a First Amended and Restated
Secured Line-of-credit Promissory Note and an Amended and Restated Security
Agreement (collectively, the "Amendment") with UDF. The Amendment amended the
existing revolving line-of-credit facility ("Loan") to extend the term an
additional five years and to increase the line-of-credit to $30 million. The
purpose of the Loan is to finance UDF's investments in real estate
development projects. The Amendment has two components:  the Long Term
Investment portion ("LTI") and the Bridge-Loan Investment portion ("BLI").

The Loan is secured by the pledge of all of UDF's land development loans and
equity investments.  Those UDF loans may be first lien loans or subordinate
loans.  The LTI portion may not exceed $12,000,000 and bears interest at an
annualized percentage rate of 15% with interest payable monthly.  The BLI
portion may not exceed $18,000,000 and is secured by the assignment of first
lien loans made by UDF to developers for the acquisition of pre-development
residential real estate.  The BLI portion is additionally secured by the
pledge of all of UDF's land development loans and equity investments.  The
BLI portion bears interest at an annualized percentage rate of 13.5% with
interest payable monthly.

The Loan is subordinate to UDF Senior Debt which consists of a loan guaranty
to Colonial Bank in the amount of approximately $8,750,000 and a $10,000,000
line-of-credit provided by Coppermark Bank.

UDF may use the Loan proceeds to finance  either: (a) indebtedness associated
with any real estate development project upon which Borrower has a first
priority lien to the extent such indebtedness, including indebtedness
financed by funds advanced hereunder and indebtedness financed by funds
advanced from any other source, including without limitation Senior Debt,
exceeds 85% of the appraised value of such real estate development project;
or (b) indebtedness associated with any real estate development project upon
which Borrower has a junior priority lien to the extent such indebtedness,
including indebtedness financed by funds advanced hereunder and indebtedness
financed by funds advanced from any other source, including without
limitation Senior Debt, exceeds 80% of 85% of the appraised value of such
real estate development project.

The Amendment represents a further increase in the Company's loans to UDF and
in the land development loans made or to be made by UDF representing
approximately 25% of the Company's entire portfolio.  The Company's Trustees
have approved this change in the Company's investment policy represented by
the increase in the Loan based upon the changed interest rate environment
which has resulted in lower yields from the Company's traditional mortgage
investments as well as experience to date with loans made to UDF.

The Company monitors the line-of-credit for collectibility on a continuing
basis based on the affiliate's payment history. No valuation allowance or
charge to earnings was recorded for the periods ending March 31, 2005 and

                                -6-


<Page>
2004 based on the Company's evaluation. Outstanding balances were $31,276,739
and $28,721,639 at March 31, 2005 and 2004, respectively. The 2005 balance
exceeds the maximum amount receivable because of the timing of a payoff that
UDF was scheduled to receive that was delayed in closing; a common
transactional occurrence. The Company has requested that UDF make a payment
to reduce the balance to its maximum amount, which they have done at the time
of this report.

5. Off Balance Sheet Transaction
On January 28, 2005, United Mortgage Trust and two of its wholly-owned
subsidiaries, UMT LT Trust as the "Seller" and UMT Funding Trust as the
"Depositor," both Maryland real estate investment trusts, simultaneously
entered into agreements described below for the securitization of $9,700,797
principal amount of United Mortgage Trust mortgage loans through the private
issuance of $7,275,598 in 9.25% Class A Notes (the "Notes"). The Notes,
together with $2,425,199 in Class B Certificates (the "Certificates"),
collectively referred to as the "Securities" were issued by Wachovia Bank as
Trustee (the "Trustee") pursuant to a Trust Agreement dated as of January 1,
2005 between the Bank and the Depositor. The Class A Notes were then sold by
the Depositor to Bayview Financial, L.P. ("Bayview"), pursuant to a Purchase
Agreement dated as of January 26, 2005 (the "Note Purchase Agreement")
between Bayview, the Depositor and United Mortgage Trust. The Notes were sold
pursuant to an exemption from the registration requirements of the Securities
Act of 1933, as amended.
The Securities evidence the entire beneficial ownership interest in a Trust
Fund created under the Trust Agreement, which consists of a pool of
performing first lien residential mortgage loans and contracts for deed (the
"Mortgage Loans") with an aggregate principal balance of $9,700,797 as of
January 1, 2005. United Mortgage Trust transferred the Mortgage Loans
(excluding the servicing rights) to the Seller as a capital contribution and
the Seller sold the Mortgage Loans to the Depositor pursuant to a Mortgage
Loan Sale Agreement dated as of January 1, 2005. The Mortgage Loan Sale
Agreement includes a right on the part of the Depositor to require the Seller
to repurchase certain Mortgage Loans upon the Seller's breach of a
representation or warranty with respect to certain characteristics of the
Mortgage Loans. United Mortgage Trust has agreed to guarantee the obligations
of the Seller under the Mortgage Loan Sale Agreement, including the
obligation of the Seller to repurchase Mortgage Loans as to which the Seller
has breached a representation or warranty. The Class B Certificates give the
Depositor the right to receipt all remaining monthly interest after all
payments due on the Class A Notes and all principal and interest on the
Mortgage Loans after retirement of the Class A Notes. The Class B
Certificates will be retained by the Depositor.
Simultaneously with the Depositor's conveyance of the Mortgage Loans to the
Trustee and pursuant to the terms of a Servicing Rights Transfer Agreement
dated as of January 1, 2005 United Mortgage Trust, as owner of the servicing
rights to the Mortgage Loans, transferred the servicing rights to the
Mortgage Loans to Bayview and, pursuant to a SubServicing Agreement dated as
of January 1, 2005 Prospect Service Corp agreed with Bayview to act as sub-
servicer of the Mortgage Loans.
                                -7-



<Page>
United Mortgage Trust intends to use the proceeds from this securitization
for general corporate purposes.
The Company did not record a servicing asset or liability for the servicing
rights retained as the fees that will be recorded will fairly compensate the
assigned servicer for the costs to be incurred with such service, and the
Company will pay all associated fees directly to PSC.

Gain or loss on the sale of the mortgage loans depends in part on the
previous carrying value of the loans involved in the transfer, allocated
between the assets sold and the retained interests based on their relative
fair market value at the date of transfer.  To obtain fair values, quoted
market prices are used if available.  However, quotes were not available for
the Company's retained interests, so the Company estimated fair value based
on the present value of future expected cash flows using management's best
estimate of the key assumptions: credit losses, prepayment speeds and
discount rates commensurate with the risks involved.  The Company used an
expected weighted-average life of 5.5 years.  Based on expected credit losses
of 1.5%, prepayment speed of 18.2% and a discount rate of 11.0%, no gain or
loss was recognized related to the sale of these mortgage loans as the
carrying value approximated the fair value at the date of the securitization.

The sensitivity to an immediate 10% and 20% adverse change in the assumptions
used to measure fair value of the securitized mortgage loans is as follows:

Prepayment speed assumption (annual rate):
Impact on fair value of 10% adverse change             $ 15,000
Impact on fair value of 20% adverse change               30,000

Expected credit losses (over remaining life of loans):
Impact on fair value of 10% adverse change               12,000
Impact on fair value of 20% adverse change               24,000

Residual cash flows discount rate (annual):
Impact on fair value of 10% adverse change              221,000
Impact on fair value of 20% adverse change             $433,000

These sensitivities are hypothetical and should be used with caution.
Changes in fair value based on a 10 percent variation in assumptions
generally cannot be extrapolated because the relationship of the change in
assumption to the change in fair value may not be linear.  Also, in this
table, the effect of a variation in a particular assumption on the fair value
of the retained interest is calculated without changing any other assumption;
in reality, changes in one factor may result in changes in another (for
example, increases in market interest rates may result in lower prepayments
and increased credit losses), which might magnify or counteract the
sensitivities.

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

     The following section contains forward-looking statements within the
meaning of Section 27A of the Securities Act, and Section 21E of the Exchange
Act and should be read in conjunction with the Consolidated financial
statements and related notes appearing in this Form 10-Q. Such forward-
looking statements may be identified by the words "anticipate," "believe,"
"estimate," "expect" or "intend" and similar expressions. Forward looking
statements are likely to address such matters as our business strategy,
future operating  results, future sources of funding for  mortgage  loans
brokered by us, future  economic  conditions  and pending litigation
involving us each of which are discussed herein under the caption "Factors
that may Affect Future Results."

                                -8-



<Page>
               RESULTS OF OPERATIONS FOR THE THREE MONTHS
                     ENDED MARCH 31, 2005 AND 2004

     We were formed on July 12, 1996, however our business operations
commenced in March 1997 when the Securities and Exchange Commission issued an
order of registration for our initial public offering of shares. We completed
our second public offering of our securities in October 2003, raising
approximately $130,540,000 in net offering proceeds. In November 2003, we
received a merger proposal from UMT Holdings, L.P, an entity organized by
persons that include some of our officers and owners and our Advisor. A
committee comprised of our Independent Trustees is currently evaluating the
proposal.

OFF BALANCE SHEET TRANSACTION

     On January 28, 2005, United Mortgage Trust and two of its wholly-owned
subsidiaries, UMT LT Trust as the "Seller" and UMT Funding Trust as the
"Depositor," both Maryland real estate investment trusts, simultaneously
entered into agreements described below for the securitization of $9,700,797
principal amount of United Mortgage Trust mortgage loans through the private
issuance of $ 7,275,598 in 9.25% Class A Notes ("Notes"). The Notes, together
with $2,425,199 in Class B Certificates (the "Certificates"), collectively
referred to as the "Securities" were issued by Wachovia Bank as Trustee
pursuant to a Trust Agreement dated as of January 1, 2005 between the Bank
and the Depositor. The Class A Notes were then sold by the Depositor to
Bayview Financial, L.P. ("Bayview"), pursuant to a Purchase Agreement dated
as of January 26, 2005 (the "Note Purchase Agreement") between Bayview, the
Depositor and United Mortgage Trust. The Notes were sold pursuant to an
exemption from the registration requirements of the Securities Act of 1933,
as amended.

     The Securities evidence the entire beneficial ownership interest in a
Trust Fund created under the Trust Agreement, which consists of a pool of
performing first lien residential mortgage loans and contracts for deed (the
"Mortgage Loans") with an aggregate principal balance of $9,700,797 as of
January 1, 2005. United Mortgage Trust transferred the Mortgage Loans
(excluding the servicing rights) to the Seller as a capital contribution and
the Seller sold the Mortgage Loans to the Depositor pursuant to a Mortgage
Loan Sale Agreement dated as of January 1, 2005. The Mortgage Loan Sale
Agreement includes a right on the part of the Depositor to require the Seller
to repurchase certain Mortgage Loans upon the Seller's breach of a
representation or warranty with respect to certain characteristics of the
Mortgage Loans. United Mortgage Trust has agreed to guarantee the obligations
of the Seller under the Mortgage Loan Sale Agreement, including the
obligation of the Seller to repurchase Mortgage Loans as to which the Seller
has breached a representation or warranty. The Class B Certificates give the
Depositor the right to receipt all remaining monthly interest after all
payments due on the Class A Notes and all principal and interest on the
Mortgage Loans after retirement of the Class A Notes. The Class B
Certificates will be retained by the Depositor.

     Simultaneously with the Depositor's conveyance of the Mortgage Loans to
the Trustee and pursuant to the terms of a Servicing Rights Transfer

                                 -9-


<Page>
Agreement dated as of January 1, 2005 United Mortgage Trust, as owner of the
servicing rights to the Mortgage Loans, transferred the servicing rights to
the Mortgage Loans to Bayview and, pursuant to a SubServicing Agreement dated
as of January 1, 2005 Prospect Service Corp agreed with Bayview to act as
sub-servicer of the Mortgage Loans.

LOANS PURCHASED DURING FIRST QUARTER MARCH 2005 AND MARCH 2004

     During the three months ended March 31, 2005 we acquired 13 new
residential mortgages with an aggregate principal balance of $517,000
compared to purchases during 2004 of three residential mortgages with an
aggregate unpaid principal balance of $124,000. Also in 2004, 29 of our
contracts for deed qualified for refinancing during the period and our loans
servicer originated new loans secured by the same property which we
acquired. The net increase in our portfolio was approximately $84,000 (the
difference between paying off the contracts for deed and purchasing the new
real estate lien notes).

     At the end of the March 2005 quarter, and with the culmination of the
two Bayview Securitizations (one in April 2004 and the other described
above), our mortgage portfolio changed significantly. We owned outright 53
residential mortgage loans and three rental properties. The balance of our
interest in residential mortgages (494 individual loans) were securitized
and held in trust on behalf of Bayview (Senior piece) and UMT LT Trust
(Subordinate piece). Adding the three categories, the total unpaid principal
balance on our books at March 31, 2005 was approximately $8,968,000, and the
yield was 9.56%. We used the proceeds from the sale of the securitizations
to pay down our line-of-credit; fund the UDF line-of-credit; and invest in
interim mortgage loans. The unpaid balance on the UDF line-of-credit was
approximately $31,000,000 and the yield for the quarter was 14.61%. Interim
mortgages totaled approximately $68,000,000 (953 loans at the end of the
quarter) and the yield was 13.28% during the March 2005 quarter.

      As of March 31, 2004, our mortgage portfolio in the aggregate
consisted of 551 residential mortgages, 42 contracts for deed and 1,136
interim mortgages, all owned outright. The portfolio had an unpaid principal
balance on the books of $103,631,000. The average loan in the portfolio had
a blended interest rate of 12.89%, a current annual yield of 12.96%, an
investment-to-value ratio of 70.55%, an unpaid principal balance of $57,000,
and a term remaining of 334 months for residential mortgages and contracts
for deed and less than 12 months for interim mortgages.

     The following table illustrates percentage of our portfolio dedicated
to each loan category:
-------------------------------------------------------
                                         March 31,
Loan Category                       2005          2004
--------------------------         --------------------
Interim Mortgages                    63%           63%
UDF Line-of-credit                   29%           12%
Securitized                           4%           --
Residential Mortgages/CFDs            4%           25%
-------------------------------------------------------

                                  -10-


<Page>
     All of the properties that are security for the mortgage investments
are located in the United States. Each of the properties was adequately
covered by a mortgagee's title insurance policy and hazard insurance.

     During the three-month periods ended March 31, 2005 and 2004, our
investments generated approximately $3,543,000 and $3,305,000 of interest
income, a 7% increase. The increase was attributed to change in our
portfolio mix.

     Operating expenses for the three-month periods were approximately
$1,843,000 and $649,000, a 184% increase, the major categories are listed
below and the fluctuation was due primarily to reserve for and loss on sale
of foreclosed properties (loan losses):

Loan losses - $1,379,000 in 2005 compared to $249,000 in 2004. We have
reserved $1,161,000 on account for future losses that we might
experience.

     Trust management fee - $226,000 in 2005 compared to $211,000 in 2004.

     General and administrative - $131,000 in 2005 compared to $125,000 in
     2004.

     Interest expense - $24,000 in 2005 compared to $27,000 in 2004.

     Loan servicing fees - $83,000 in 2005 and $37,000 in 2004.

     Operating expenses, less interest expense, as a percentage of income
were 51.33% and 18.81%, respectively, for the 2005 and 2004 three-month
periods, and operating expenses as a percentage of invested assets were
1.71% and 0.53%, respectively.

     We recorded a loan loss reserve of $1,379,000 and $249,000 during the
comparative quarters of 2005 and 2004. We recorded loan losses realized as
anticipated of $1,139,000 and $349,000 in comparable periods, respectively.
Loss reserves are recorded monthly at a rate of 1% of the unpaid principal
balance of each interim mortgage acquired and at a rate of the greater of
approximately 40% of the UPB on properties that will be sold outright and
15% of the UPB of properties (primarily the securitized properties) that we
plan to rehab and owner finance or approximately the amount of the losses we
sustained during the period. Of approximately $356,000,000 in loans
acquired, we have recorded losses and loss reserves of 1.79% of those assets
to date. We anticipate loan losses to continue and therefore are continuing
to monitor the adequacy of our loan loss reserve and we are expecting to
increase our loan loss reserves on a go-forward basis.

     Our default rate as of March 31, 2005 and 2004 was approximately 3% and
4%, respectively, of our incoming producing assets. In comparable periods
respectively, approximately 17% and 11% of long-term loans (residential
mortgages/CFD/securitized loans) were defaulted, approximately 3% and 2% of
interim mortgages were defaulted and no defaults on our UDF line-of-credit.

     Net income was approximately $1,700,000 and $2,656,000, respectively a
36% decrease, for the three months ended March 31, 2005 and 2004,

                                 -11-


<Page>
respectively. Earnings per weighted average share were $0.24 and $0.38. The
decrease was a result of loan losses and reserves for loans losses during
the 2005 quarter. In order to mitigate loans losses we have made the
decision to rehabilitate many of our REO and owner financed properties, if
necessary, to facilitate the sale of the properties. We believe that in
today's real estate bullish environment, we will be able to reduce losses on
properties employing this strategy.

    Distributions to shareholders per share of beneficial interest in 2005
and 2004 were at rates of $0.1333 and $0.1533 per share per month,
respectively, a 13% decrease on a comparative quarterly basis which is
attributable to the additional loan losses recorded in the first quarter
2005.

                  CAPITAL RESOURCES AND LIQUIDITY FOR
             THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004

     We utilize funds made available from our dividend reinvestment plan,
from our bank line-of-credit and repayment of principal on our loans to
purchase mortgage investments.
                                                  March 31,
                                         2005                   2004
---------------------------------------------------------------------
Shares issued                                46,700           57,700
Number of new shareholders                      --               --
Gross proceeds                          $   936,000      $ 1,154,000
Share repurchases                       $(1,006,000)     $  (641,000)
Redemption of shares of beneficial
  interest                                      --       $ ( 583,000)
Principal receipts from Residential
  Mortgages and Contracts for Deed      $   638,000      $ 2,022,000
Principal receipts from
  Interim Mortgages                     $19,204,000      $15,481,000
Securitization proceeds                 $ 7,276,000           --
Net borrowing from credit line          $(9,780,000)     $(6,000,000)

   We are no longer offering shares in the public markets except to existing
shareholders through our dividend reinvestment plan. We completed our public
offering of our securities in October 2003, raising approximately
$130,540,000 in net offering proceeds. In November 2003, we received a merger
proposal from UMT Holdings, L.P, an entity organized by persons that include
some of our officers and owners and our Advisor. A committee comprised of our
Independent Trustees is currently evaluating the proposal.

     Shares issued in the aggregate, as of March 31, 2005 and 2004, were
7,729,773 and 7,528,596, respectively. Shares retired to treasury through
our share redemption plan in the aggregate were 692,490 and 453,917,
respectively. Total shares outstanding were 7,037,283 and 7,074,679,
respectively. Inception to date gross offering proceeds were approximately
$154,323,000 and net proceeds after fees, marketing reallowance and
commissions were $137,355,000.

    On November 8, 2004, with trustee approval, we entered into a three year
loan agreement with a $15 million revolving credit facility with a new bank.

                                 -12-


<Page>
The line-of-credit payable was collateralized by certain interim mortgages.
Interest on the outstanding balance accrues at prime plus 0.5% per annum
(6.00% at March 31, 2005). The outstanding balance on the line-of-credit was
$2,250,100 at March 31, 2005. The outstanding balance on our line-of-credit
at March 31, 2004 was $6,000,000 at 4.5% interest.

     We are closely monitoring the gradual increase in the prime lending
rate. We are aware that higher consumer interest rates may negatively
impact home building, sales of real estate and real estate development,
and therefore may negatively impact our ability to acquire a sufficient
number of quality loans to support our dividend at the current rate. At
the time of this report, analysts have found no negative impact in real
estate markets from the gradual increase in rates over the past several
months. Historically we have experienced prime lending rate as high as 10%
without negative effects on real estate markets and our business.

Item 3. Quantitative and Qualitative Disclosure About Market Risk.

No change.

Item 4. CONTROLS AND PROCEDURES

     We maintain disclosure controls and procedures designed to ensure
that information disclosed in our annual and periodic reports is recorded,
processed, summarized and reported within the time periods specified in
the Securities and Exchange Commission's rules and forms. In addition, we
designed these disclosure controls and procedures to ensure that this
information is accumulated and communicated to our management, including
our chief executive officer (our "CEO") and chief financial officer (our
"CFO"), to allow timely decisions regarding required disclosure. SEC rules
require that we disclose the conclusions of our CEO and CFO about the
effectiveness of our disclosure controls and procedures.

     We do not expect that our disclosure controls and procedures will
prevent all errors or fraud. A control system, no matter how well
conceived and operated, can provide only reasonable, not absolute,
assurance that the objectives of the control system are met. In addition,
the design of disclosure controls and procedures must reflect the fact
that there are resource constraints, and the benefits of controls must be
considered relative to their costs. Because of the inherent limitation in
a cost-effective control system, misstatements due to error or fraud could
occur and not be detected.

         We evaluate the effectiveness of our disclosure controls and
procedures as of the end of each fiscal quarter. Based on our most recent
evaluation, our CEO and CFO believe, and have certified, that our
disclosure controls and procedures are effective to (1) ensure that
material information relating to us is made known to management, including
the CEO and CFO, particularly during the period when our periodic reports
are being prepared, and (2) provide reasonable assurance that our
consolidated financial statements fairly present in all material respects
our financial condition and results of operations.

      Since the date of this most recent evaluation, there have been no
significant changes in our internal controls or in other factors that
could significantly affect the internal controls subsequent to the date we
completed our evaluation.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

None.


                               -13-


<Page>
Item 2. Changes in Securities and Use of Proceeds.

     We are offering up to 511,000 shares of beneficial interest at $20 per
share through our dividend reinvestment plan. There are no commissions or
fees paid from the proceeds. We use proceeds from the plan primarily to
repurchase shares in our share redemption plan. Absent applications for
repurchase, we use the proceeds to buy mortgage investments

     The following table sets forth information relating to shares of
beneficial interest issued and the use of proceeds of the offering during the
quarter ended March 31, 2005.

Shares issued                    46,700
Gross proceeds                 $935,557


Item 3. Defaults Upon Senior Debentures.

Not applicable.

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

None.


Item 5. Other Information.

MERGER PROPOSAL

     In November 2003, we received a merger proposal from an entity
organized by persons that include officers and owners of the Company and
its advisor. The proposal by UMT Holdings, L.P. ("UMTH") a Delaware
limited partnership and real estate finance company based in Dallas,
Texas, provides that we would be merged into UMTH.  As currently
proposed, each holder of our shares of beneficial interest at the time of
the closing of the merger would receive a 10-year Class A Debenture
having an original principal amount of $20 for each share owned by such
holder and an annual interest rate of 8.5%, which interest shall be
payable monthly. The proposal contains other terms and may be amended or
modified at any time.

      In response to the proposal, our Board of Trustees formed a special
committee comprised of Richard D. O'Connor, Jr., Paul R. Guernsey and
Douglas R. Evans, each an independent and disinterested trustee.  The
special committee retained legal and financial experts to assist it in
evaluating the proposal.  The special committee has been negotiating the
final terms of any transaction with UMTH on behalf of the Company and
evaluating the fairness of the terms to our shareholders who are not
affiliated with UMTH. At the conclusion of its negotiations and
deliberations, the special committee will make a recommendation to the
full Board of Trustees with respect to the transaction.  In addition, the
special committee may entertain other unsolicited inquiries from any
other parties interested in the possible acquisition of our outstanding
shares of beneficial interest and, as appropriate, provide information,
enter into discussions and negotiate with such parties in connection with

                                -14-



<Page>
any such inquiries. As of the date of this report there have been no
inquiries from other sources.

      UMTH's proposal is contingent upon, among other things, (i) the
negotiation, execution and delivery of a definitive agreement, (ii)
approval of the transaction by the special committee, the Company's full
Board of Trustees and the Company's shareholders, (iii) the special
committee's receipt of a fairness opinion from its financial advisor,
(iv) the effectiveness of a registration statement with the Securities
and Exchange Commission to permit the submission of the merger to a vote
of the Company's shareholders and to register the notes, (v) applicable
regulatory approvals, (vi) obtaining any necessary third-party consents
or waivers, and (vii) certain other conditions.

      There can be no assurance that a definitive merger agreement will
be executed and delivered, or that UMTH's proposed transaction will be
consummated. The proposed transaction may only be completed in accordance
with the applicable state and federal laws, including the Securities Act
of 1933, as amended, and the Securities Exchange Act of 1934, as amended.

     Based upon the status of negotiations and discussions with UMTH, we
believe that it is likely that the independent committee will recommend
the merger and that the agreement will be announced in the second quarter
of 2005.


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

Form 8-K filed February 2, 2005 - Items 1.01, 9.01 - with reference to United
Development Funding Loan Agreement

Form 8-K filed February 3, 2005 - Items 1.01, 2.03, 9.01 - with reference to
Bayview Securitization 2005-1.


Exhibit 31. Certification pursuant to Section 302 of the Sarbanes-Oxley Act

Exhibit 32. Certification pursuant to Section 906 of the Sarbanes-Oxley Act


SIGNATURES

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


                                        UNITED MORTGAGE TRUST
                                        (Registrant)

Date:  May 5, 2005                    /S/Christine A. Griffin
                                         Christine A. Griffin
                                              President

                                  -15-

EXHIBITS

Exhibit 31. Certification pursuant to Section 302 of the Sarbanes-Oxley Act

I, Christine A. Griffin, certify that:

1. I have reviewed this quarterly report on Form 10-Q of United Mortgage Trust;

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

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

4. I am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
registrant and have:

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

(b) Designed such internal control over financial reporting, or
caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally
accepted accounting principles;

         (c) Evaluated the effectiveness of the registrant's disclosure
         controls and procedures and presented in this report our conclusions
         about the effectiveness of the disclosure controls and procedures, as
         of the end of the period covered by this report based on such
         evaluation; and

         (d) Disclosed in this report any change in the registrant's internal
         control over financial reporting that occurred during the registrant's
         most recent fiscal quarter that has materially affected, or is
         reasonably likely to materially affect, the registrant's internal
         control over financial reporting.

5. I have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant's auditors and the audit committee
of the registrant's board of trustees:

         (a) All significant deficiencies and material weaknesses in the design
         or operation of internal control over financial reporting which are
         reasonably likely to adversely affect the registrant's ability to
         record, process, summarize and report financial information; and

         (b) Any fraud, whether or not material, that involves management or
         other employees who have a significant role in the registrant's
         internal control over financial reporting.

May 5, 2005                        /s/ Christine Griffin
                                     ---------------------------------------
                                     Christine Griffin
                                     President and Chief Executive Officer

                                   -16-

<Page>
Exhibit 32. Certification pursuant to Section 906 of the Sarbanes-Oxley Act

I, Christine A. Griffin, Chief Executive Officer and Chief Financial Officer
of United Mortgage Trust (the "registrant"), have executed this certification
for furnishing to the Securities and Exchange Commission in connection with
the filing with the Commission of the registrant's Quarterly Report on Form
10-Q for the period ended March 31, 2005 (the "Report"). I hereby certify
that:

         (1)      the Report fully complies with the requirements of Section
                  13(a) or 15(d) of the Securities Exchange Act of 1934; and

         (2)      the information contained in the Report fairly presents, in
                  all material respects, the financial condition and results
of operations of the of the registrant as of and for the
end of that period.


May 5, 2005


/s/ Christine A Griffin
-----------------------
Christine A Griffin
Chief Executive Officer/Chief Financial Officer


                               -17-