UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   -----------

                                    FORM 10-Q
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[X] QUARTERLY REPORT PURSUANT TO SECTION 12 OR 15(d) OF THE SECURITIES EXCHANGE
              ACT OF 1934 FOR THE QUARTER ENDED SEPTEMBER 30, 2006

                                       OR

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

            FOR THE TRANSITION PERIOD FROM ___________ TO ___________

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                         COMMISSION FILE NUMBER 0-19564

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                       MUNICIPAL SECURITIES PURCHASE, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

                  DELAWARE                                 13-3633082
--------------------------------------------   ---------------------------------
(State or other jurisdiction incorporation      (I.R.S. Employer Identification
              or organization)                                 No.)

        201 HIGH RIDGE ROAD, STAMFORD,
                 CONNECTICUT                                  06927
--------------------------------------------------------------------------------
   (Address of principal executive offices)                (Zip Code)

       (REGISTRANTS TELEPHONE NUMBER, INCLUDING AREA CODE) (203) 357-4000
                                                           --------------

           SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

                                      NONE

           SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

                               TITLE OF EACH CLASS
                               -------------------

                    COMMON STOCK, PAR VALUE $10.00 PER SHARE

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes  X  No    .
                                       ---    ---

Indicate by check mark whether the registrant is a large  accelerated  filer, an
accelerated  filer, or a  non-accelerated  filer. See definition of "accelerated
filer and large  accelerated  filer" in Rule 12b-2 of the Exchange  Act.
(Check one):
Large accelerated filer      Accelerated filer      Non-accelerated filer  X
                        ---                    ---                        ---

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes     No  X .
                                     ---    ---

At October 27, 2006, 10 shares of voting common stock,  which constitutes all of
the  outstanding  common  equity,  with a par  value of $10.00  per  share  were
outstanding.

REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND (b)
OF FORM 10-Q AND IS THEREFORE FILING THIS FORM 10-Q WITH THE REDUCED  DISCLOSURE
FORMAT.

<PAGE>

                       MUNICIPAL SECURITIES PURCHASE, INC.




                                                                           PAGE


PART I.     FINANCIAL INFORMATION

Item 1.   Financial Statements
               Statement of Financial Position                               1
               Statement of Income                                           2
               Statement of Changes in Shareowner's Equity                   3
               Statement of Cash Flows                                       4
               Notes to Unaudited Interim Financial Statements               5

Item 2.   Management's Discussion and Analysis of Results of Operations and
          Financial Condition                                                6

Item 4.   Controls and Procedures                                            7


PART II.    OTHER INFORMATION

Item 6.   Exhibits                                                           8
Signatures                                                                   9




Unless the context otherwise requires, the "Company," "Municipal-SPI," "We,"
"Us," or "Our" shall mean Municipal Securities Purchase, Inc.


FORWARD-LOOKING STATEMENTS

This document contains "forward-looking statements" - that is, statements
related to future, not past, events. In this context, forward-looking statements
often address our expected future business and financial performance, and often
contain words such as "expects," "anticipates," "intends," "plans," "believes,"
"seeks," or "will." Forward-looking statements by their nature address matters
that are, to different degrees, uncertain. For us, particular uncertainties
arise from the behavior of financial markets, including fluctuations in interest
rates and from numerous other matters of national, regional and global scale,
including those of a political, economic, business, competitive or regulatory
nature. These uncertainties may cause our actual future results to be materially
different than those expressed in our forward-looking statements. We do not
undertake to update our forward-looking statements.

<PAGE>

                          PART I. FINANCIAL INFORMATION



ITEM 1. FINANCIAL STATEMENTS


                       MUNICIPAL SECURITIES PURCHASE, INC.


                          Statement of Financial Position

                                                     September 30,  December 31,
                                                          2006          2005
                                                     -------------  ------------
                                   ASSETS             (unaudited)

Liquidity fees receivable                              $  385,789    $1,149,615
Due from GE Capital                                     2,212,609     2,854,275
                                                       ----------    ----------
             Total assets                              $2,598,398    $4,003,890
                                                       ----------    ----------

               LIABILITIES AND SHAREOWNER'S EQUITY

Deferred liquidity fee income                          $  262,982    $  393,002
Accounts payable and accrued expenses                      76,973        13,700
                                                       ----------    ----------
             Total liabilities                            339,955       406,702
                                                       ----------    ----------

Common stock, par value $10.00 per share.
    Authorized, issued, and outstanding 10 shares             100           100
Additional paid-in capital                                822,145       822,145
Retained earnings                                       1,436,198     2,774,943
                                                       ----------    ----------
             Total shareowner's equity                  2,258,443     3,597,188
                                                       ----------    ----------
             Total liabilities and shareowner's equity $2,598,398    $4,003,890
                                                       ==========    ==========


See accompanying notes to unaudited interim financial statements.

                                       1
<PAGE>

                       MUNICIPAL SECURITIES PURCHASE, INC.


                               Statement of Income

                                   (Unaudited)


<TABLE>
<CAPTION>
                                              --------------------------      --------------------------
                                                  THREE MONTHS ENDED              NINE MONTHS ENDED
                                                     SEPTEMBER 30                   SEPTEMBER 30
                                              --------------------------      --------------------------
                                                 2006            2005            2006            2005
                                              ----------      ----------      ----------      ----------
<S>                                           <C>             <C>             <C>             <C>
Liquidity fee income                          $  822,759      $1,336,962      $2,924,453      $4,277,753
                                              ----------      ----------      ----------      ----------
             Total revenues                      822,759       1,336,962       2,924,453       4,277,753
                                              ----------      ----------      ----------      ----------

General and administrative expenses               12,412          20,635          73,808          71,271
GE Capital commitment fees                        28,260          45,884         102,498         147,187
                                              ----------      ----------      ----------      ----------
             Total operating expenses             40,672          66,519         176,306         218,458
                                              ----------      ----------      ----------      ----------

             Income before provision for
               income taxes                      782,087       1,270,443       2,748,147       4,059,295
                                              ----------      ----------      ----------      ----------

Income tax expense:
    Federal:                                     254,569         413,529         894,522       1,321,300
    State and local                               54,746          88,931         192,370         284,151
                                              ----------      ----------      ----------      ----------

             Total income tax expense            309,315         502,460       1,086,892       1,605,451
                                              ----------      ----------      ----------      ----------

             Net income                       $  472,772      $  767,983      $1,661,255      $2,453,844
                                              ==========      ==========      ==========      ==========
</TABLE>


See accompanying notes to unaudited interim financial statements.

                                       2
<PAGE>

                       MUNICIPAL SECURITIES PURCHASE, INC.


                   Statement of Changes in Shareowner's Equity

                  Nine-months ended September 30, 2006 and 2005


<TABLE>
<CAPTION>
                                                               ADDITIONAL
                                                COMMON           PAID-IN          RETAINED
                                                STOCK            CAPITAL          EARNINGS           TOTAL
<S>                                          <C>               <C>               <C>              <C>
Balance, December 31, 2004                   $       100       $   822,145       $ 5,614,291      $ 6,436,536
Dividends paid  (unaudited)                                                       (6,000,000)      (6,000,000)
Net income (unaudited)                                                             2,453,844        2,453,844
                                             ----------------------------------------------------------------
Balance, September 30, 2005 (unaudited)      $       100       $   822,145       $ 2,068,135      $ 2,890,380
                                             ================================================================

Balance, December 31, 2005                   $       100       $   822,145       $ 2,774,943      $ 3,597,188
Dividends paid (unaudited)                                                        (3,000,000)      (3,000,000)
Net income (unaudited)                                                             1,661,255        1,661,255
                                             ----------------------------------------------------------------
Balance, September 30, 2006 (unaudited)      $       100       $   822,145       $ 1,436,198      $ 2,258,443
                                             ================================================================
</TABLE>


See accompanying notes to unaudited interim financial statements.

                                       3
<PAGE>

                       MUNICIPAL SECURITIES PURCHASE, INC.


                             Statement of Cash Flows

                                   (Unaudited)


<TABLE>
<CAPTION>
                                                          --------------------------
                                                               NINE-MONTHS ENDED
                                                                 SEPTEMBER 30
                                                          --------------------------
                                                             2006           2005
                                                          -----------    -----------
<S>                                                       <C>            <C>
Operating activities:
Net income                                                $ 1,661,255    $ 2,453,844
    Adjustments to reconcile net income to net cash
      provided by operating activities:
        Change in due from GE Capital                         641,666      4,045,343
        Change in liquidity fees receivable                   763,826       (316,458)
        Change in deferred liquidity fee income              (130,020)      (169,511)
        Change in accounts payable and accrued expenses        63,273        (13,218)
                                                          -----------    -----------
           Cash from operating activities                   3,000,000      6,000,000

Financing activities:
    Dividends paid                                         (3,000,000)    (6,000,000)
                                                          -----------    -----------
           Cash used for financing activities              (3,000,000)    (6,000,000)

Net change  in cash and cash equivalents                           --             --
Cash and cash equivalents at beginning of period                   --             --
                                                          -----------    -----------
Cash and cash equivalents at the end of period            $        --    $        --
                                                          ===========    ===========
</TABLE>


See accompanying notes to unaudited interim financial statements.

                                       4
<PAGE>

                       MUNICIPAL SECURITIES PURCHASE, INC.

                 NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS

(1)      BUSINESS DESCRIPTION

         Municipal  Securities  Purchase,  Inc. (the Company) is a  wholly-owned
         subsidiary  of GE  Funding  Services  Inc.  (the  Parent),  which  is a
         wholly-owned  subsidiary  of GEI,  Inc.,  and in turn,  wholly owned by
         General Electric Capital Corporation (GE Capital),  the ultimate parent
         of which is General  Electric  Company (GE).  In the fourth  quarter of
         2003, FGIC Securities  Purchase,  Inc.  (FGIC-SPI)  changed its name to
         Municipal Securities Purchase,  Inc. The Company provides liquidity for
         certain  floating rate municipal  securities  whereby the Company will,
         under certain circumstances, purchase such securities in the event they
         are  tendered  by the  holders  as  permitted  under  the  terms of the
         respective bond  indentures.  As of September 30, 2006, the Company had
         approximately  $1.6  billion  (par amount and  interest)  of  potential
         obligations under such arrangements. When issued, each of the liquidity
         facilities had a term not exceeding five years (subject to renewal). In
         order to obtain  funds to purchase  the  securities,  in the event such
         purchases  are  necessary,  the Company has entered  into  standby loan
         agreements  with GE Capital  totaling  $1.6 billion as of September 30,
         2006, under which GE Capital is irrevocably  obligated to lend funds as
         needed for the Company to purchase the securities.

         BASIS OF PRESENTATION

         The  preparation  of  financial  statements  in  conformity  with  U.S.
         generally accepted  accounting  principles  requires management to make
         estimates  and  assumptions  that affect  reported  amounts and related
         disclosures. Actual results could differ from those estimates.

         The unaudited interim financial  statements of the Company contained in
         this report reflect all normal recurring adjustments necessary,  in the
         opinion  of  management,  for a fair  statement  of  income,  financial
         position  and cash  flows.  The  results  reported  in these  quarterly
         financial  statements should not be regarded as necessarily  indicative
         of  results  that may be  expected  for the entire  year.  We label our
         quarterly  information  using a  calendar  convention,  that is,  first
         quarter is labeled as ending March 31, second quarter as ending on June
         30, and third quarter as ending on September 30. It is our longstanding
         practice to establish  interim  quarterly  closing dates using a fiscal
         calendar,  which  requires  our  business  to  close  their  books on a
         Saturday. The effects of this practice are modest and only exist within
         a reporting year. The fiscal closing calendar from 1993 through 2013 is
         available on our website, www.ge.com/secreports.

         These  unaudited  interim  financial   statements  should  be  read  in
         conjunction with the financial statements and related notes included in
         the 2005 Form 10-K.

(2)      INCOME TAXES

         We are included in GE's  consolidated  U.S.  federal  income tax return
         under an intercompany  tax-sharing agreement. The provision for current
         tax expense includes our effect on the consolidated  return. We provide
         for taxes as if we filed a separate return.

                                       5
<PAGE>

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

         RESULTS OF OPERATIONS

         REVENUES

         We provide  liquidity  facilities  for certain  floating rate municipal
         securities whereby we will, under certain circumstances,  purchase such
         securities  in the event  they are  tendered  by the  holders.  We earn
         liquidity  fees  from  the  issuers  of  these  securities,   municipal
         governments in the U.S., for providing the liquidity facilities.

         During 2005 and the  nine-months  ended  September 30, 2006, we did not
         commit to any new liquidity facilities.

         We earned liquidity fees of approximately $2.9 million and $4.3 million
         during the nine-months ended September 30, 2006 and 2005,  respectively
         and $0.8  million  and  $1.3  million  during  the  three-months  ended
         September 30, 2006 and 2005, respectively. The total liquidity facility
         in  force  as  of  September  30,  2006  and  September  30,  2005  was
         approximately $1.6 billion and $2.9 billion, respectively. The decrease
         in liquidity  fees from 2005 to 2006  corresponds  with the  respective
         decrease in the liquidity  facilities in force. This decrease is due to
         the maturity of the underlying liquidity facilities.

         OPERATING EXPENSES

         We incurred  $176,306 and $218,458 of total  operating  expenses during
         the nine-months  ended September 30, 2006 and 2005,  respectively,  and
         $40,672 and $66,519 during the  three-months  ended  September 30, 2006
         and 2005,  respectively.  Included  in total  operating  expenses  were
         commitment  fees owed to GE Capital under the standby loan  agreements,
         which  are  based  on the  outstanding  par in  force  on  each  of the
         liquidity  facilities at a rate of 0.625 basis points.  Commitment fees
         were $102,498 and $147,187 for the nine-months ended September 30, 2006
         and 2005,  respectively,  and $28,260 and $45,884 for the  three-months
         ended  September  30,  2006 and 2005,  respectively.  The  decrease  in
         commitment  fees  from  2005 to 2006  corresponds  with the  respective
         decrease in liquidity fees earned,  which is also based upon the par in
         force on each of the liquidity facilities outstanding.  Total operating
         expenses also includes general and administrative  expenses,  which are
         principally  comprised of intercompany  overhead  expense  allocations.
         General and  administrative  expenses  were $73,808 and $71,271 for the
         nine-months  ended  September  30,  2006 and  2005,  respectively,  and
         $12,412 and $20,635 during the  three-months  ended  September 30, 2006
         and 2005, respectively.

         INCOME TAX EXPENSE

         The  statutory  U.S.  Federal  tax rate during the  three-months  ended
         September  30, 2006 and 2005 was 35%. Our effective tax rate was 39.55%
         including  the net effect of state taxes for the three and  nine-months
         ended September 30, 2006.

         CAPITAL RESOURCES AND LIQUIDITY

         Liquidity  is a measure of the ability to generate  sufficient  cash to
         meet cash  obligations  as they come due.  The largest use of potential
         liquidity would be if we were required to purchase all securities under
         the liquidity  facilities  issued.  Since  inception,  we have not been
         required to purchase any  securities.  If we were  required to purchase
         such securities, we

                                       6
<PAGE>

         would draw on the standby loan  agreements  with GE Capital.  Since the
         standby  loan  agreements  with GE Capital are  irrevocable  during the
         period the liquidity  agreements  are  outstanding,  we believe we have
         sufficient liquidity in the event that we are required to fund any draw
         downs under the liquidity facilities issued.

         Our other primary source of cash is from liquidity fee income, which we
         lend to GE  Capital.  We  believe  that such  income  and access to the
         intercompany  receivable  from GE Capital  ($2,212,609 at September 30,
         2006) is sufficient to fund our general and administrative expenses.

         Net cash  provided by  operating  activities  was $3.0  million for the
         nine-months  ended September 30, 2006, as we collected a portion of the
         intercompany receivable from GE Capital. We used the cash to pay a $3.0
         million dividend to the Parent,  resulting in a $3.0 million  financing
         cash outflow during the  nine-months  ended  September 30, 2006.  There
         were no cash flows related to investing  activities for the nine-months
         ended September 30, 2006.

ITEM 4.  CONTROLS AND PROCEDURES

         Under the direction of our Chairman (serving as the Principal Executive
         Officer) and Vice  President  and  Treasurer  (serving as the Principal
         Financial and Accounting Officer), we evaluated our disclosure controls
         and  procedures  and internal  control  over  financial  reporting  and
         concluded  that  (i)  our  disclosure   controls  and  procedures  were
         effective  as of  September  30,  2006,  and (ii) no change in internal
         control over  financial  reporting  occurred  during the quarter  ended
         September  30, 2006,  that has  materially  affected,  or is reasonably
         likely to  materially  affect,  such  internal  control over  financial
         reporting.

                                       7
<PAGE>

                           PART II - OTHER INFORMATION

ITEM 6.  EXHIBITS


               Exhibit  31(a) -  Certification  Pursuant to Rules  13a-14(a) and
               15d-14(a) under the Securities Exchange Act of 1934, as Amended.

               Exhibit  31(b) -  Certification  Pursuant to Rules  13a-14(a) and
               15d-14(a) under the Securities Exchange Act of 1934, as Amended.

               Exhibit 32 - Certification Pursuant to 18 U.S.C. Section 1350.

                                       8
<PAGE>

                                   SIGNATURES


Pursuant to the  requirements  of Section 13 or 15(d) of the  Securities  Act of
1934,  the  registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

                       MUNICIPAL SECURITIES PURCHASE, INC.
                                  (Registrant)


October 30, 2006                                   /s/ LeAnn Rogers
----------------                                   ----------------
Date                                               LeAnn Rogers
                                                   Chairman
                                                   (Principal Executive Officer)

October 30, 2006                                   /s/ Peter Graham
----------------                                   ----------------
Date                                               Peter Graham
                                                   Vice President and Treasurer
                                                   (Principal Financial and
                                                   Accounting Officer)

                                       9