Exhibit 10.2

                    AMENDED AND RESTATED CONSULTING AGREEMENT

      This AMENDED AND RESTATED CONSULTING AGREEMENT (this "Agreement") is dated
as of December 31, 2002, between Gary C. Granoff ("Consultant"), Ameritrans
Capital Corporation ("Ameritrans"), and Elk Associates Funding Corporation
("Elk") (collectively, Ameritrans and Elk are hereinafter referred to as the
"Company").

      WHEREAS, Consultant entered into a consulting agreement with the Company
dated as of July 1, 2001 (the "2001 Consulting Agreement"); and

      WHEREAS, Consultant and the Company desire to restate and amend certain
terms of the 2001 Consulting Agreement;

      NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:

      1.    ENGAGEMENT

      The Company hereby engages and retains Consultant to perform the Services
(as that term is hereinafter defined), and Consultant hereby accepts such
appointment on the terms and subject to the conditions hereinafter set forth and
agrees to use his best efforts in providing such Services.

      2.    INDEPENDENT CONTRACTOR

      Consultant shall be, and in all respects be deemed to be, an independent
contractor in the performance of his duties hereunder, any law of any
jurisdiction to the contrary notwithstanding. Consultant shall not, by reason of
this Agreement or the performance of the Services, be or be deemed to be, an
employee or agent of the Company, and Consultant shall have no power to enter
into any agreement on behalf of, or otherwise bind the Company. Without limiting
the foregoing, Consultant shall not enter into any contract or commitment on
behalf of the Company without the Company's prior written consent.

            COMMENCEMENT AND TERM

                  Commencement. This Agreement shall not be effective and shall
not commence unless and until the Employment Agreement between the Company and
Consultant dated December 31, 2002 (the "Employment Agreement"), is terminated
due to (i) the voluntary resignation of Consultant from his employment pursuant
to Section 6.2 of the Employment Agreement or (ii) a notice of non-renewal from
the Company or Consultant pursuant to Section 6.2 of the Employment Agreement.

                  Term. Provided the Employment Agreement is terminated pursuant
to clauses (i) or (ii) of Section 3.1, above, this Agreement shall commence upon
the date of termination of the Employment Agreement (the "Commencement Date"),
and shall continue for a period of five (5) years (the "Consulting Period").

            SERVICES

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                  Consultant agrees to provide the following services,
hereinafter collectively referred to as the "Services":

            Serve as business consultant for the Company, which shall include,
but not be limited to, general advice and consultation regarding the business
and operations of the Company, investor relations, and providing assistance in
setting the business direction and strategic objectives of the Company.

                  BEST EFFORTS. Consultant shall devote such time and effort as
he deems commercially reasonable under the circumstances to the affairs of the
Company as is reasonable and adequate to render the consulting services
contemplated by this Agreement; provided, however, in no event shall Consultant
be required to devote more than half-time or twenty (20) hours per week to the
performance of the Services. It is further understood and agreed by the parties
that Consultant shall make himself available, and the non-use of Consultant by
the Company shall in no manner affect the Company's obligations to make the
payments provided hereunder.

            COMPENSATION AND RELATED MATTERS

                  Compensation. In consideration for his availability and/or
providing the Services, Consultant shall be paid an amount equal to one-half
(1/2) of the sum of (i) Consultant's monthly Base Salary that was in effect at
the time the Employment Agreement was terminated, and (ii) the most recent Bonus
paid under the terms of the Employment Agreement prior to its termination. All
capitalized financial terms having the meanings defined in the Employment
Agreement are herein incorporated by reference.

                  Other Benefits. During the Consulting Period, subject to and
to the extent Consultant is eligible, Consultant shall be entitled to receive
fifty percent (50%) of the benefits, set forth in Section 4.3 of the Employment
Agreement, that Consultant was receiving from the Company at the time of
termination of the Employment Agreement and at the levels in effect at the time
of such termination, except for the following, to which Consultant shall be
entitled to the same extent as under the Employment Agreement, (i) premiums on
disability insurance not to exceed $5,500 per annum, (ii) husband and wife
medical coverage, and (iii) the contributions to Consultant's SEP IRA, which
shall continue at up to 15% of Consultant's fee compensation.

                  Expense Reimbursement. The Company shall reimburse Consultant
for all business expenses reasonably incurred by him in the performance of his
duties under this Agreement in accordance with the Company's procedures and
policies as adopted and in effect from time to time and applicable to its senior
management employees.

            TERMINATION

                  Voluntary Termination by Consultant. Consultant may, by notice
to the Company at any time during the Consulting Period, upon thirty (30) days'
prior written notice, terminate this Agreement.

                  By the Company for Cause. The Company may, at any time during
the Consulting Period, by notice to sConsultant, terminate this Consulting
Agreement for "Cause." As used herein, "Cause" shall mean (i) incompetence,
fraud, personal dishonesty, defalcation, or acts of gross negligence or gross
misconduct on the part of Consultant, (ii) substantial and continued

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failure by Consultant to perform the Services, (iii) Consultant's conviction by
a court of competent jurisdiction of, or pleading "guilty" or "no contest" to,
(x) a felony, or (y) any other criminal charge (other than minor traffic
violations) which has or could reasonably be expected to have a material adverse
impact on the Company's reputation and standing in the community, or (iv)
Consultant's violation of any of the provisions of Section 8 herein. Any notice
given by the Company pursuant to this Section 6.2 shall specify in writing in
reasonable detail the event or the nature of Consultant's action or inaction
that is the cause for giving such notice. Consultant will have 30 days to cure,
to the reasonable satisfaction of the Company, any action or inaction charged by
the Company for Cause under (ii), above. In the event of a termination of the
Consulting Period for Cause under (i), (iii), or (iv), above, the Consulting
Period shall terminate immediately upon notice by the Company of termination for
Cause and the reason therefor, unless such actions or inactions can be cured and
Consultant has satisfactorily cured such actions or inactions.

            TERMINATION COMPENSATION

                  Termination by Consultant. If Consultant terminates this
Agreement in accordance with Section 6.1 or Section 6.2, the Company shall pay
to Consultant, within thirty (30) calendar days of the date of termination,
Consultant's fee through the date of termination.

                  Certain Other Terminations. If the Consulting Period is
terminated by the Company for Cause pursuant to the provisions of Section 6.2,
the Company shall pay to Consultant, within thirty (30) calendar days of the
date of termination, Consultant's Fee through the date of termination.

            CONFIDENTIALITY

                  Unless otherwise required by law or judicial process,
Consultant shall retain in confidence during the Consulting Period and after
termination of this Agreement all confidential information known to Consultant
concerning the Company and its businesses. The obligations of Consultant
pursuant to this Section 8 shall survive the expiration or termination of this
Agreement.

            NONCOMPETITION

      Consultant shall not directly or indirectly, whether by way of employment,
consulting, advising, ownership, partnership, joint venture, or other method,
engage in any Competitive Activity (as defined below) during the Consulting
Period. "Competitive Activity" shall exclude those activities described in
Section 3 of the Employment Agreement and shall include business activity which
is the same as or substantially similar to or is or would be competitive with
the business activity in which the Company is engaged during the Consulting
Period.

            NONSOLICITATION

      During the Consulting Period and for a period of one year thereafter (the
"Nonsolicitation Period"), Consultant shall not directly or indirectly solicit
to enter into the employ of any other Entity, or hire, any of the employees of
the Company. During the Consulting Period, and for a period of one year
thereafter, Consultant shall not, directly or indirectly, solicit, hire, or take
away or attempt to solicit, hire, or take away (i) any customer or client of the
Company or (ii) any former customer or client (that is, any customer or client
who ceased to do business with the Company during the three (3) years
immediately preceding such date) of the Company or

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encourage any customer or client of the Company to terminate its relationship
with the Company without the Company's prior written consent. The obligations of
Consultant pursuant to this Section 10 shall survive the expiration or
termination of this Agreement.

            SUCCESSORS; BINDING AGREEMENT

            This Agreement and all rights of Consultant hereunder shall inure to
the benefit of and be enforceable by Consultant and Consultant's personal or
legal representatives, executors, administrators, successors, heirs,
distributees, divisees, and legatees. If Consultant should die while any amounts
would still be payable to him hereunder if he had continued to live, all such
amounts, unless otherwise provided herein, shall be paid in accordance with the
terms of this Agreement to Consultant's devisee, legatee, or other beneficiary
or, if there be no such beneficiary, to Consultant's estate.

            SURVIVORSHIP

            The respective rights and obligations of the parties hereunder shall
survive any termination of this Agreement to the extent necessary to the
intended preservation of such rights and obligations.

            MISCELLANEOUS

                  Notices. Any notice, consent, or authorization required or
permitted to be given pursuant to this Agreement shall be in writing and sent to
the party for or to whom intended, at the address of such party set forth below,
by registered or certified mail, postage paid (deemed given five days after
deposit in the U.S. mails) or personally delivered or sent by facsimile
transmission (deemed given upon receipt), or at such other address as either
party shall designate by notice given to the other in the manner provided
herein.

If to the Company: Ameritrans Capital Corporation
         Elk Associates Funding Corporation
         747 Third Avenue, 4th Floor
         New York, New York 10017
         Attn:

If to Consultant: Mr. Gary Granoff
         2 Fir Drive
         Great Neck, New York 11024

            Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of New York, without reference
to the principles of conflicts of laws therein.

            Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration in
the city in which the Company's main corporate headquarters is then located in
accordance with the rules of the American Arbitration Association then in
effect. Judgment may be entered on the arbitration award in any court having
jurisdiction.

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            Headings. All descriptive headings in this Agreement are inserted
for convenience only, and shall be disregarded in construing or applying any
provision of this Agreement.

            Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed to be an original, but all of which, together, shall
constitute one and the same instrument.

            Severability. If any provision of this Agreement, or any part
thereof, is held to be unenforceable, the remainder of such provision and this
Agreement, as the case may be, shall nevertheless remain in full force and
effect.

            Entire Agreement and Representation. This Agreement and the
Employment Agreement contain the entire agreement and understanding between the
Company and Consultant with respect to the subject matter hereof. No
representations or warranties of any kind or nature relating to the Company or
its several businesses, or relating to the Company's assets, liabilities,
operations, future plans, or prospects have been made by or on behalf of the
Company to Consultant.

            Termination of 2001 Consulting Agreement. The Company and the
Consultant hereby acknowledge that this Agreement is an amendment and
restatement of the 2001 Consulting Agreement, and as such, is a termination of
the 2001 Consulting Agreement. Both the Company and the Consultant hereby
relinquish any and all rights they may have resulting from the termination of
the 2001 Consulting Agreement.

            Validity. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision or provisions of this Agreement, which shall remain in full
force and effect. If any provision of this Agreement is held to be invalid,
void, or unenforceable in any jurisdiction, any court or arbitrator so holding
shall substitute a valid, enforceable provision that preserves, to the maximum
lawful extent, the terms and intent of such provisions of this Agreement. If any
of the provisions of, or covenants contained in, this Agreement are hereafter
construed to be invalid or unenforceable in any jurisdiction, the same shall not
affect the remainder of the provisions or the enforceability thereof in any
other jurisdiction, which shall be given full force and effect, without regard
to the invalidity or unenforceability in such other jurisdiction. Any such
holding shall affect such provision of this Agreement, solely as to that
jurisdiction, without rendering that or any other provisions of this Agreement
invalid, illegal, or unenforceable in any other jurisdiction. If any covenant
should be deemed invalid, illegal, or unenforceable because its scope is
considered excessive, such covenant will be modified so that the scope of the
covenant is reduced only to the minimum extent necessary to render the modified
covenant valid, legal, and enforceable.

      IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.

                                         AMERITRANS CAPITAL CORPORATION

                                         By:
                                         /s/ Ellen M. Walker


                                         ELK ASSOCIATES FUNDING CORPORATION

                                         By:
                                         /s/ Ellen M. Walker


                                         /s/ Gary C. Granoff