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U.S. SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549


FORM 10-Q

(MARK ONE)

|    |  |                                                        
|--- |  | -------------------------------------------------------
|[X] |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
|    |  | SECURITIES EXCHANGE ACT OF 1934                        

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2003

Or

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

Transition Period From         To

COMMISSION FILE NUMBER 333-32800

VESTIN FUND I, LLC

(Exact Name of Registrant as Specified in Its Charter)


|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|NEVADA                                                         |  | 88-0446244                          
|(State or Other Jurisdiction of
Incorporation or Organization) |  | (I.R.S. Employer
Identification No.)

2901 EL CAMINO AVENUE, SUITE 206, LAS VEGAS, NEVADA 89102
(Address Of Principal Executive Offices) (Zip Code)

Registrants Telephone Number: 702.227.0965

Indicate by check 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   [   ]

As of July 31, 2003, the Issuer had 9,168,116 of its Units outstanding.

Indicate by check whether the registrant is an accelerated filer (as defined in
Rule 12b-2 of the Exchange Act.)

Yes   [   ]   No   [X]





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TABLE OF CONTENTS



|             |                                                                                               |                               |  |  |  |  |  | 
|------------ | --------------------------------------------------------------------------------------------- | ----------------------------- |  |  |  |  |  | 
|             |                                                                                               | BALANCE SHEETS               
|             |                                                                                               | STATEMENTS OF INCOME (LOSS)  
|             |                                                                                               | STATEMENT OF MEMBERS EQUITY 
|             |                                                                                               | STATEMENTS OF CASH FLOWS     
|             |                                                                                               | NOTES TO FINANCIAL STATEMENTS
|             | ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|             | ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                           
|             | ITEM 4. CONTROLS AND PROCEDURES.                                                             
|             | ITEM 1. LEGAL PROCEEDINGS                                                                    
|             | ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS                                            
|             | ITEM 3. DEFAULTS UPON SENIOR SECURITIES                                                      
|             | ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                  
|             | ITEM 5. OTHER INFORMATION                                                                    
|             | ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K                                                     
|SIGNATURES  
|EXHIBIT 31.1
|EXHIBIT 31.2
|EXHIBIT 32  



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TABLE OF CONTENTS

|                                                                                                    |                                                                                                    |  |      |   | 
|--------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------- |  | ---- | - | 
|                                                                                                    |                                                                                                    |  | PAGE
|                                                                                                    |                                                                                                    |  |     
|PART I FINANCIAL INFORMATION                                                                        |                                                                                                    |  |      |  
|Item 1. Financial Statements
Balance sheets as of June 30, 2003 (unaudited), and September 30, 2002 |                                                                                                    |  | 3    |  
|                                                                                                    | Statements
of income (loss) for the three and nine months ended June 30, 2003 and 2002 (unaudited) |  |      | 4 | 
|                                                                                                    | Statement of members equity for the nine months ended June 30, 2003 (unaudited)                   |  |      | 5 | 
|                                                                                                    | Statements of cash flows for the nine months ended June 30, 2003 and 2002 (unaudited)              |  |      | 6 | 
|                                                                                                    | Notes to financial statements (unaudited)                                                          |  |      | 8 | 
|Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations       |                                                                                                    |  | 15   |  
|Item 3. Quantitative and Qualitative Disclosures about Market Risk                                  |                                                                                                    |  | 22   |  
|Item 4. Controls and Procedures                                                                     |                                                                                                    |  | 23   |  
|PART II OTHER INFORMATION                                                                           |                                                                                                    |  |      |  
|Item 1. Legal Proceedings                                                                           |                                                                                                    |  | 24   |  
|Item 2. Changes in Securities and Use of Proceeds                                                   |                                                                                                    |  | 24   |  
|Item 3. Defaults Upon Senior Securities                                                             |                                                                                                    |  | 24   |  
|Item 4. Submission of Matters to a Vote of Security Holders                                         |                                                                                                    |  | 24   |  
|Item 6. Exhibits and Reports on Form 8-K                                                            |                                                                                                    |  | 24   |  
|SIGNATURES                                                                                          |                                                                                                    |  | 25   |  

2



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Vestin Fund I, LLC
BALANCE SHEETS

|                                                                                                                                                                         |                        |                                       |            |               |            |                    |            |           |             | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ---------------------- | ------------------------------------- | ---------- | ------------- | ---------- | ------------------ | ---------- | --------- | ----------- | 
|                                                                                                                                                                         |                        |                                       |            | (UNAUDITED)   |            |                    |            |          
|                                                                                                                                                                         |                        |                                       |            | June 30, 2003 |            | SEPTEMBER 30, 2002
|                                                                                                                                                                         |                        |                                       |            |               |            |                   
|ASSETS                                                                                                                                                                  
|Cash                                                                                                                                                                     |                        | $                                     | 1,704,262  |               |            | $                  | 2,762,334  |          
|Certificates of deposit                                                                                                                                                  |                        |                                       | 1,500,000  |               |            |                    | 2,775,000  |          
|Interest and other receivables                                                                                                                                           |                        |                                       | 983,837    |               |            |                    | 1,175,972  |          
|Note receivable from Manager                                                                                                                                             |                        |                                       | 583,347    |               |            |                    |           |          
|Due from Manager                                                                                                                                                         |                        |                                       | 28,089     |               |            |                    |           |          
|Real estate held for sale                                                                                                                                                |                        |                                       | 18,222,126 |               |            |                    | 1,541,258  |          
|Investment in mortgage loans, net of allowance for loan
losses of $400,000 and $100,000, respectively                                                                    |                        |                                       | 67,550,030 |               |            |                    | 91,091,308 |          
|Assets under secured borrowing                                                                                                                                           |                        |                                       | 3,070,357  |               |            |                    | 6,637,370  |          
|Deferred bond offering costs                                                                                                                                             |                        |                                       |           |               |            |                    | 83,631     |          
|                                                                                                                                                                         |                        |                                       |            |               |            |                    |            |          
|                                                                                                                                                                         |                        | Total assets                          |            | $             | 93,642,048 |                    |            | $         | 106,066,873 | 
|                                                                                                                                                                         |                        |                                       |            |               |            |                    |            |          
|LIABILITIES AND MEMBERS EQUITY                                                                                                                                         
|Liabilities                                                                                                                                                              |                        |                                       |            |               |            |                    |            |          
|                                                                                                                                                                         | Due to Manager         |                                       | $          |              |            |                    | $          | 430,447   |            
|                                                                                                                                                                         | Due to related parties |                                       |            | 300,951       |            |                    |            |          |            
|                                                                                                                                                                         | Secured borrowing      |                                       |            | 3,070,357     |            |                    |            | 6,637,370 |            
|                                                                                                                                                                         |                        |                                       |            |               |            |                    |            |          
|                                                                                                                                                                         |                        | Total liabilities                     |            |               | 3,371,308  |                    |            |           | 7,067,817   | 
|                                                                                                                                                                         |                        |                                       |            |               |            |                    |            |          
|Members equity  authorized 10,000,000 units
9,413,554 and 9,928,052 units issued and outstanding
at $10 per unit at June 30, 2003 and
September 30, 2002, respectively |                        |                                       | 90,270,740 |               |            |                    | 98,999,056 |          
|                                                                                                                                                                         |                        |                                       |            |               |            |                    |            |          
|                                                                                                                                                                         |                        | Total members equity                 |            |               | 90,270,740 |                    |            |           | 98,999,056  | 
|                                                                                                                                                                         |                        |                                       |            |               |            |                    |            |          
|                                                                                                                                                                         |                        | Total liabilities and members equity |            | $             | 93,642,048 |                    |            | $         | 106,066,873 | 
|                                                                                                                                                                         |                        |                                       |            |               |            |                    |            |          

The accompanying notes are an
integral part of these statements.

3



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Vestin Fund I, LLC
STATEMENTS OF INCOME (LOSS)(UNAUDITED)

|                                                                             |                                                   |                          |            |                            |            |                           |            |           |           |      |           |           |           |   |           |           |           | 
|---------------------------------------------------------------------------- | ------------------------------------------------- | ------------------------ | ---------- | -------------------------- | ---------- | ------------------------- | ---------- | --------- | --------- | ---- | --------- | --------- | --------- | - | --------- | --------- | --------- | 
|                                                                             |                                                   |                          |            | FOR THE THREE MONTHS ENDED |            | FOR THE NINE MONTHS ENDED
|                                                                             |                                                   |                          |            | JUNE 30,                   |            | JUNE 30,                 
|                                                                             |                                                   |                          |            |                            |            |                          
|                                                                             |                                                   |                          |            | 2003                       |            | 2002                      |            | 2003      |           | 2002
|                                                                             |                                                   |                          |            |                            |            |                           |            |           |           |     
|Revenues                                                                     |                                                   |                          |            |                            |            |                           |            |           |           |      |           |           |           |   |           |          
|                                                                             | Interest income from investment in
mortgage loans |                          | $          | 2,135,694                  |            |                           | $          | 3,038,228 |           |      | $         | 7,127,622 |           |   | $         | 9,650,017 |          
|                                                                             | Loan fees                                         |                          |            | 190,919                    |            |                           |            |          |           |      |           | 295,707   |           |   |           |          |          
|                                                                             | Other income                                      |                          |            | 315,623                    |            |                           |            | 5,550     |           |      |           | 387,298   |           |   |           | 247,826   |          
|                                                                             |                                                   |                          |            |                            |            |                           |            |           |           |      |           |           |           |   |           |          
|                                                                             |                                                   | Total revenues           |            |                            | 2,642,236  |                           |            |           | 3,043,778 |      |           |           | 7,810,627 |   |           |           | 9,897,843 | 
|                                                                             |                                                   |                          |            |                            |            |                           |            |           |           |      |           |           |           |   |           |          
|Operating expenses                                                           |                                                   |                          |            |                            |            |                           |            |           |           |      |           |           |           |   |           |          
|                                                                             | Interest expense                                  |                          |            | 150,444                    |            |                           |            |          |           |      |           | 508,658   |           |   |           |          |          
|                                                                             | Management fees to Manager                        |                          |            | 63,796                     |            |                           |            | 62,342    |           |      |           | 189,304   |           |   |           | 248,110   |          
|                                                                             | Valuation loss on real estate held for sale       |                          |            | 3,312,370                  |            |                           |            |          |           |      |           | 3,312,370 |           |   |           |          |          
|                                                                             | Write-off of deferred bond offering costs         |                          |            | 223,394                    |            |                           |            |          |           |      |           | 223,394   |           |   |           |          |          
|                                                                             | Provision for loan losses                         |                          |            | 100,000                    |            |                           |            |          |           |      |           | 300,000   |           |   |           |          |          
|                                                                             | Other                                             |                          |            | 213,823                    |            |                           |            | 16,757    |           |      |           | 294,718   |           |   |           | 17,028    |          
|                                                                             |                                                   |                          |            |                            |            |                           |            |           |           |      |           |           |           |   |           |          
|                                                                             |                                                   | Total operating expenses |            |                            | 4,063,827  |                           |            |           | 79,099    |      |           |           | 4,828,444 |   |           |           | 265,138   | 
|                                                                             |                                                   |                          |            |                            |            |                           |            |           |           |      |           |           |           |   |           |          
|                                                                             |                                                   | NET
INCOME (LOSS)        |            | $                          | (1,421,591 | )                         |            | $         | 2,964,679 |      |           | $         | 2,982,183 |   |           | $         | 9,632,705 | 
|                                                                             |                                                   |                          |            |                            |            |                           |            |           |           |      |           |           |           |   |           |          
|Net income (loss) allocated to members                                       |                                                   | $                        | (1,421,591 | )                          |            | $                         | 2,964,679  |           |           | $    | 2,982,183 |           |           | $ | 9,632,705 |          
|                                                                             |                                                   |                          |            |                            |            |                           |            |           |           |      |           |           |           |   |           |          
|Net income (loss) allocated to members per
weighted average membership units |                                                   | $                        | (0.15      | )                          |            | $                         | 0.29       |           |           | $    | 0.30      |           |           | $ | 1.00      |          
|                                                                             |                                                   |                          |            |                            |            |                           |            |           |           |      |           |           |           |   |           |          
|Weighted average membership units                                            |                                                   |                          | 9,553,031  |                            |            |                           | 10,230,168 |           |           |      | 9,802,259 |           |           |   | 9,635,603 |          
|                                                                             |                                                   |                          |            |                            |            |                           |            |           |           |      |           |           |           |   |           |          

The accompanying notes are an
integral part of these statements.

4



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Vestin Fund I, LLC
STATEMENT OF MEMBERS EQUITY(UNAUDITED)

|                                      |  |       |           |        |  |   |            |  
|------------------------------------- |  | ----- | --------- | ------ |  | - | ---------- | -
|                                      |  | Units |           | Amount
|                                      |  |       |           |       
|Members equity at September 30, 2002 |  |       | 9,928,052 |        |  | $ | 98,999,056 |  
|Distributions                         |  |       |          |        |  |   | (8,165,519 | )
|Capital contribution from Manager     |  |       |          |        |  |   | 1,600,000  |  
|Reinvestments of distributions        |  |       | 181,836   |        |  |   | 1,818,361  |  
|Members withdrawals                  |  |       | (696,334  | )      |  |   | (6,963,341 | )
|Net income                            |  |       |          |        |  |   | 2,982,183  |  
|                                      |  |       |           |        |  |   |            |  
|Members equity at June 30, 2003      |  |       | 9,413,554 |        |  | $ | 90,270,740 |  
|                                      |  |       |           |        |  |   |            |  

The accompanying notes are an
integral part of these statements.

5



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Vestin Fund I, LLC
STATEMENTS OF CASH FLOWS
(UNAUDITED)

|                                      |                                                                                   |                                                   |                                           |             |                           |             |         |             |   |             |  
|------------------------------------- | --------------------------------------------------------------------------------- | ------------------------------------------------- | ----------------------------------------- | ----------- | ------------------------- | ----------- | ------- | ----------- | - | ----------- | -
|                                      |                                                                                   |                                                   |                                           |             | FOR THE NINE MONTHS ENDED
|                                      |                                                                                   |                                                   |                                           |             | June 30,                 
|                                      |                                                                                   |                                                   |                                           |             |                          
|                                      |                                                                                   |                                                   |                                           |             | 2003                      |             | 2002   
|                                      |                                                                                   |                                                   |                                           |             |                           |             |        
|Cash flows from operating activities: |                                                                                   |                                                   |                                           |             |                           |             |         |            
|                                      | Net income                                                                        |                                                   | $                                         | 2,982,183   |                           |             | $       | 9,632,705   |  
|                                      | Adjustments to reconcile net income to net
cash provided by operating activities: |                                                   |                                           |             |                           |             |         |             |  
|                                      |                                                                                   | Valuation allowance for real estate held for sale |                                           |             | 3,312,370                 |             |         |             |  |            
|                                      |                                                                                   | Write-off of deferred bond offering costs         |                                           |             | 223,394                   |             |         |             |  |            
|                                      |                                                                                   | Provision for loan losses                         |                                           |             | 300,000                   |             |         |             |  |            
|                                      |                                                                                   | Change in operating assets and liabilities:       |                                           |             |                           |             |         |             |   |            
|                                      |                                                                                   |                                                   | Due to Manager                            |             |                           | 2,001       |         |             |   | 92,766      |  
|                                      |                                                                                   |                                                   | Due to related parties                    |             |                           | 300,951     |         |             |   |            |  
|                                      |                                                                                   |                                                   | Interest and other receivables            |             |                           | 183,113     |         |             |   | 204,570     |  
|                                      |                                                                                   |                                                   | Other assets                              |             |                           |            |         |             |   | (51,673     | )
|                                      |                                                                                   |                                                   | Accounts payable                          |             |                           |            |         |             |   | 125,734     |  
|                                      |                                                                                   |                                                   | Deferred bond offering costs              |             |                           | (139,763    | )       |             |   |            |  
|                                      |                                                                                   |                                                   |                                           |             |                           |             |         |            
|                                      |                                                                                   |                                                   | Net cash provided by operating activities |             |                           | 7,164,249   |         |             |   | 10,004,102  |  
|                                      |                                                                                   |                                                   |                                           |             |                           |             |         |            
|Cash flows from investing activities: |                                                                                   |                                                   |                                           |             |                           |             |         |            
|                                      | Purchase of investments in mortgage loans                                         |                                                   |                                           | (25,921,730 | )                         |             |         | (69,775,519 | )
|                                      | Purchase of investments in mortgage loans from:                                   |                                                   |                                           |             |                           |             |         |             |  
|                                      |                                                                                   | Vestin Fund II, LLC                               |                                           |             | (14,249,950               | )           |         |             |  |            
|                                      |                                                                                   | Vestin Group, Inc.                                |                                           |             | (3,700,000                | )           |         |             |  |            
|                                      |                                                                                   | Other related party                               |                                           |             | (809,307                  | )           |         |             |  |            
|                                      |                                                                                   | Private investor                                  |                                           |             | (380,403                  | )           |         |             |  |            
|                                      | Proceeds received from sale of mortgage loans to:                                 |                                                   |                                           |             |                           |             |         |             |  
|                                      |                                                                                   | Vestin Fund II, LLC                               |                                           |             | 17,460,213                |             |         |             |  |            
|                                      |                                                                                   | Vestin Group, Inc.                                |                                           |             | 4,500,000                 |             |         |             |  |            
|                                      |                                                                                   | Other related party                               |                                           |             | 290,938                   |             |         |             |  |            
|                                      |                                                                                   | Private investor                                  |                                           |             | 150,000                   |             |         |             |  |            
|                                      | Proceeds from loans paid off                                                      |                                                   |                                           | 25,373,417  |                           |             |         | 69,853,676  |  
|                                      | Proceeds from sale of investment in real estate
held for sale to Manager          |                                                   |                                           | 1,100,000   |                           |             |         |            |  
|                                      | Proceeds from certificates of deposit                                             |                                                   |                                           | 1,275,000   |                           |             |         |            |  
|                                      |                                                                                   |                                                   |                                           |             |                           |             |         |            
|                                      |                                                                                   |                                                   | Net cash provided by investing activities |             |                           | 5,088,178   |         |             |   | 78,157      |  
|                                      |                                                                                   |                                                   |                                           |             |                           |             |         |            
|Cash flows from financing activities: |                                                                                   |                                                   |                                           |             |                           |             |         |            
|                                      | Members withdrawals                                                              |                                                   |                                           | (6,963,341  | )                         |             |         | (2,408,349  | )
|                                      | Members distributions, net of reinvestments                                      |                                                   |                                           | (6,347,158  | )                         |             |         | (7,841,114  | )
|                                      |                                                                                   |                                                   |                                           |             |                           |             |         |            
|                                      |                                                                                   |                                                   | Net cash used in financing activities     |             |                           | (13,310,499 | )       |             |   | (10,249,463 | )
|                                      |                                                                                   |                                                   |                                           |             |                           |             |         |            
|                                      |                                                                                   |                                                   | NET DECREASE IN CASH                      |             |                           | (1,058,072  | )       |             |   | (167,204    | )
|Cash, beginning                       |                                                                                   |                                                   | 2,762,334                                 |             |                           |             | 398,262 |            
|                                      |                                                                                   |                                                   |                                           |             |                           |             |         |            
|Cash, ending                          |                                                                                   | $                                                 | 1,704,262                                 |             |                           | $           | 231,058 |            
|                                      |                                                                                   |                                                   |                                           |             |                           |             |         |            

The accompanying notes are an
integral part of these statements.

6



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Vestin Fund I, LLC
STATEMENTS OF CASH FLOWS
(UNAUDITED)
(CONTINUED)

|                                                    |                                              |                                                                                                   |  |                           |            |      |  |   |           | 
|--------------------------------------------------- | -------------------------------------------- | ------------------------------------------------------------------------------------------------- |  | ------------------------- | ---------- | ---- |  | - | --------- | 
|                                                    |                                              |                                                                                                   |  | FOR THE NINE MONTHS ENDED
|                                                    |                                              |                                                                                                   |  | JUNE 30                  
|                                                    |                                              |                                                                                                   |  |                          
|                                                    |                                              |                                                                                                   |  | 2003                      |            | 2002
|                                                    |                                              |                                                                                                   |  |                           |            |     
|Supplemental disclosures of cash flows information: |                                              |                                                                                                   |  |                           |            |      |  |  
|                                                    | Non-cash investing and financing activities: |                                                                                                   |  |                           |            |      |  |   |          
|                                                    |                                              | Reinvestment of members distributions                                                            |  | $                         | 1,818,361  |      |  | $ | 2,137,782 | 
|                                                    |                                              |                                                                                                   |  |                           |            |      |  |  
|                                                    |                                              | Real estate held for sale acquired through foreclosure                                            |  | $                         | 19,930,526 |      |  | $ |          | 
|                                                    |                                              |                                                                                                   |  |                           |            |      |  |  
|                                                    |                                              | Investment
in mortgage loans in real estate acquired for investments in real
estate held for sale |  | $                         | 478,829    |      |  | $ |          | 
|                                                    |                                              |                                                                                                   |  |                           |            |      |  |  
|                                                    |                                              | Note receivable related to capital contribution by Manager                                        |  | $                         | 723,763    |      |  | $ |          | 
|                                                    |                                              |                                                                                                   |  |                           |            |      |  |  
|                                                    |                                              | Payoff of payable to Manager related to capital contribution                                      |  | $                         | 876,237    |      |  | $ |          | 
|                                                    |                                              |                                                                                                   |  |                           |            |      |  |  
|                                                    |                                              | Sale of rights to receive proceeds of guaranty                                                    |  | $                         | 3,084,000  |      |  | $ |          | 
|                                                    |                                              |                                                                                                   |  |                           |            |      |  |  
|                                                    |                                              | Conversion of deferred offering costs to membership units                                         |  | $                         |           |      |  | $ | 1,000,000 | 
|                                                    |                                              |                                                                                                   |  |                           |            |      |  |  

The accompanying notes are an
integral part of these statements.

7



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VESTIN FUND I, LLC

NOTES TO FINANCIAL STATEMENTS

June 30, 2003

(Unaudited)

NOTE A  ORGANIZATION

Vestin Fund I, LLC, a Nevada Limited Liability Company, (the Company) is
primarily engaged in the business of mortgage lending. The Company invests in
loans secured by real estate through deeds of trust and mortgages. The Company
was organized in December 1999 and will continue until December 31, 2019 unless
dissolved prior thereto or extended by vote of the members under the provisions
of the Companys Operating Agreement.

The Manager of the Company is Vestin Mortgage, Inc. (the Manager), a Nevada
corporation engaged in the business of brokerage, placement and servicing of
commercial loans secured by real property. The Manager is a wholly owned
subsidiary of Vestin Group, Inc., a Delaware Corporation, whose common stock is
publicly held and traded on the Nasdaq National Market under the symbol VSTN.
Through its subsidiaries, Vestin Group, Inc. is engaged in asset management,
real estate lending and other financial services and has managed over $1
billion in real estate loans. The Operating Agreement provides that the
Manager controls the daily operating activities of the Company; including the power to
assign duties, to determine how to invest the Companys assets, to sign bills
of sale, title documents, leases, notes, security agreements, mortgage
investments and contracts, and to assume direction of the business operations.
The Operating Agreement also provides that the members have certain rights,
including the right to terminate the Manager subject to a majority vote of the
members.

Vestin Mortgage, Inc. is also the Manager of Vestin Fund II, LLC, (Fund II)
and inVestin Nevada, Inc., entities in the same business as the Company.

The financial statements have been prepared in accordance with Securities and
Exchange Commission requirements for interim financial statements. Therefore,
they do not include all of the information and footnotes required by accounting
principles generally accepted in the United States for complete financial
statements. The financial statements should be read in conjunction with the
financial statements and notes thereto contained in the Companys annual report
on Form 10-K for the transition period ended September 30, 2002.

Certain
reclassifications have been made to the prior years consolidated financial
statements to conform with the current year presentation.

The results of operations for the interim periods shown in this report are not
necessarily indicative of results to be expected for the full year. In the
opinion of management, the information contained herein reflects all
adjustments necessary to make the results of operations for the interim periods
a fair statement of such operation. All such adjustments are of a normal
recurring nature.

NOTE B  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. MANAGEMENT ESTIMATES

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

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2. INVESTMENTS IN MORTGAGE LOANS

Investments in mortgage loans are secured by trust deeds and mortgages.
Generally, all of the Companys mortgage loans require interest only payments
with a balloon payment of the principal at maturity. The Company has both the
intent and ability to hold mortgage loans until maturity and therefore,
mortgage loans are classified and accounted for as held for investment and are
carried at cost. Loans sold to or purchased from affiliates are
accounted for at the principal balance and no gain or loss is
recognized by the Company or any affiliate. Loan to value ratios are based on appraisals obtained at the
time of loan origination and may not reflect subsequent changes in value
estimates. Such appraisals, which may be commissioned by the borrower, are generally dated within 12 months of the date of
loan origination. The appraisals may be for the current estimate of the as-if
developed value of the property, which approximates the post-construction
value of the collateralized property assuming that such property is developed.
As-if developed values on raw land loans or acquisition and development loans
often dramatically exceed the immediate sales value and may include anticipated
zoning changes and timely successful development by the purchaser. As most of
the appraisals will be prepared on an as-if developed basis, if a loan goes
into default prior to any development of a project, the market value of the
property may be substantially less than the appraised value. As a result,
there may be less security than anticipated at the time the loan was originally
made. If there is less security and a default occurs, the Company may not
recover the full amount of the loan.

3. ALLOWANCE FOR LOAN LOSSES

The Company maintains an allowance for loan losses on its investment in
mortgage loans for estimated credit losses in the Companys investment in
mortgage loans portfolio. The Managers estimate of losses is based on a number
of factors including the types and dollar amounts of loans in the portfolio,
adverse situations that may affect the borrowers ability to repay, prevailing
economic conditions and the underlying collateral securing the loan. Additions
to the allowance are provided through a charge to earnings and are based on an
assessment of certain factors which may indicate estimated losses on the loans.
Actual losses on loans are recorded as a charge-off or a reduction to the
allowance for loan losses. Subsequent recoveries of amounts previously charged
off are added back to the allowance.

4. REAL ESTATE HELD FOR SALE

Real estate held for sale includes real estate acquired through foreclosure and
is carried at the lower of cost or the propertys estimated fair value, less
estimated costs to sell, based on appraisals and local market knowledge.

5. SECURED BORROWING

Certain loans that have been participated to third party investors
(Investor) through an intercreditor agreement (Agreement) are accounted for
as secured borrowings in accordance with SFAS No. 140, Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities(SFAS No.
140). Under the Agreement, investors may participate in certain loans with
Vestin Mortgage, Fund II, and the Company (collectively, the Lead Lenders).
In the event of borrower non-performance, the intercreditor agreement gives the
Lead Lenders the right to either (i) continue to remit to the Investor the
interest due on the participation amount; (ii) substitute an alternative loan
acceptable to the Investor; or (iii) repurchase the participation from the
Investor for the outstanding balance of the participation plus accrued
interest. Consequently, the Investor is in a priority lien position against
the collateralized loans and mortgage loan financing under the participation
arrangement is accounted for as a secured borrowing in accordance with SFAS No.
140.

Assets under secured borrowing have been segregated in the accompanying
balance sheet and as of June 30, 2003 include loans outstanding of $3.0 million
and real estate acquired through foreclosure of $58,250.

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NOTE C  INVESTMENTS IN MORTGAGE LOANS

Investments in mortgage loans are as follows:

June 30, 2003

|                            |  |        |    |         |  |               |            |            |  |           |       |      |  |  |        |   |  |  |       |  
|--------------------------- |  | ------ | -- | ------- |  | ------------- | ---------- | ---------- |  | --------- | ----- | ---- |  |  | ------ | - |  |  | ----- | -
|                            |  | Number |    |         |  |               |            |            |  |           |       |      |  |  |        |   |  | 
|Loan                        |  | Of     |    |         |  |               |            | Average    |  | Portfolio |       | Loan
|Type                        |  | Loans  |    | Balance |  | Interest Rate |            | Percentage |  | To Value*
|                            |  |        |    |         |  |               |            |            |  |          
|Acquisition and development |  |        | 5  |         |  | $             | 10,058,773 |            |  |           | 14.20 | %    |  |  | 14.80  | % |  |  | 41.59 | %
|Bridge                      |  |        | 5  |         |  |               | 6,179,636  |            |  |           | 12.90 | %    |  |  | 9.09   | % |  |  | 53.57 | %
|Commercial                  |  |        | 21 |         |  |               | 29,023,596 |            |  |           | 12.07 | %    |  |  | 42.71  | % |  |  | 65.54 | %
|Construction                |  |        | 7  |         |  |               | 11,059,055 |            |  |           | 13.68 | %    |  |  | 16.28  | % |  |  | 59.92 | %
|Land                        |  |        | 7  |         |  |               | 11,134,141 |            |  |           | 12.86 | %    |  |  | 16.39  | % |  |  | 42.22 | %
|Residential                 |  |        | 4  |         |  |               | 494,829    |            |  |           | 12.88 | %    |  |  | 0.73   | % |  |  | 68.35 | %
|                            |  |        |    |         |  |               |            |            |  |           |       |      |  |  |        |   |  |  |       |  
|                            |  |        | 49 |         |  | $             | 67,950,030 |            |  |           | 13.09 | %    |  |  | 100.00 | % |  |  | 56.58 | %
|                            |  |        |    |         |  |               |            |            |  |           |       |      |  |  |        |   |  |  |       |  

September 30, 2002

|                            |  |        |    |         |  |               |            |            |  |           |       |      |  |  |        |   |  |  |       |  
|--------------------------- |  | ------ | -- | ------- |  | ------------- | ---------- | ---------- |  | --------- | ----- | ---- |  |  | ------ | - |  |  | ----- | -
|                            |  | Number |    |         |  |               |            |            |  |           |       |      |  |  |        |   |  | 
|Loan                        |  | Of     |    |         |  |               |            | Average    |  | Portfolio |       | Loan
|Type                        |  | Loans  |    | Balance |  | Interest Rate |            | Percentage |  | To Value*
|                            |  |        |    |         |  |               |            |            |  |          
|Acquisition and development |  |        | 11 |         |  | $             | 17,379,074 |            |  |           | 13.66 | %    |  |  | 19.06  | % |  |  | 50.89 | %
|Bridge                      |  |        | 3  |         |  |               | 9,129,025  |            |  |           | 13.17 | %    |  |  | 10.01  | % |  |  | 69.20 | %
|Commercial                  |  |        | 10 |         |  |               | 28,181,705 |            |  |           | 13.20 | %    |  |  | 30.90  | % |  |  | 57.40 | %
|Construction                |  |        | 11 |         |  |               | 26,241,223 |            |  |           | 14.09 | %    |  |  | 28.78  | % |  |  | 51.93 | %
|Land                        |  |        | 4  |         |  |               | 10,260,281 |            |  |           | 13.19 | %    |  |  | 11.25  | % |  |  | 32.33 | %
|                            |  |        |    |         |  |               |            |            |  |           |       |      |  |  |        |   |  |  |       |  
|                            |  |        | 39 |         |  | $             | 91,191,308 |            |  |           | 13.58 | %    |  |  | 100.00 | % |  |  | 52.54 | %
|                            |  |        |    |         |  |               |            |            |  |           |       |      |  |  |        |   |  |  |       |  

*Loan to value ratios are based on appraisals obtained at the time of loan
origination and may not reflect subsequent changes in value estimates. Such
appraisals are generally dated no greater than 12 months prior to the date of
loan origination. The appraisals may be for the current estimate of the as-if
developed value of the property, which approximates the post-construction
value of the collateralized property assuming that such property is developed.
As-if developed values on raw land loans or acquisition and development loans
often dramatically exceed the immediate sales value and may include anticipated
zoning changes, selection by a purchaser against multiple alternatives, and
successful development by the purchaser; upon which development is dependent on
availability of financing. As most of the appraisals will be prepared on an
as-if developed basis, if a loan goes into default prior to any development of
a project, the market value of the property may be substantially less than the
appraised value. As a result, there may be less security than anticipated at
the time the loan was originally made. If there is less security and a default
occurs, the Company may not recover the full amount of the loan.

|                   |  |               |            |            |  |                    |        |            |  |   |            |  |  |  |        |  
|------------------ |  | ------------- | ---------- | ---------- |  | ------------------ | ------ | ---------- |  | - | ---------- |  |  |  | ------ | -
|                   |  | June 30, 2003 |            | Portfolio  |  | September 30, 2002 |        | Portfolio 
|Loan Type          |  | Balance       |            | Percentage |  | Balance            |        | Percentage
|                   |  |               |            |            |  |                    |        |           
|First mortgages    |  | $             | 67,945,030 |            |  |                    | 99.99  | %          |  | $ | 91,180,814 |  |  |  | 99.99  | %
|Second mortgages** |  |               | 5,000      |            |  |                    | 0.01   | %          |  |   | 10,494     |  |  |  | 0.01   | %
|                   |  |               |            |            |  |                    |        |            |  |   |            |  |  |  |        |  
|                   |  | $             | 67,950,030 |            |  |                    | 100.00 | %          |  | $ | 91,191,308 |  |  |  | 100.00 | %
|                   |  |               |            |            |  |                    |        |            |  |   |            |  |  |  |        |  

**   All of the Companys second mortgages are junior to a first trust deed
position held by either the Company or the Companys Manager.

The following is a schedule of contractual maturities of investments in
mortgage loans as of June 30, 2003:

|     |  |   |            | 
|---- |  | - | ---------- | 
|2003 |  | $ | 59,564,957 | 
|2004 |  |   | 5,899,262  | 
|2005 |  |   | 2,485,811  | 
|     |  |   |            | 
|     |  | $ | 67,950,030 | 
|     |  |   |            | 

This does not necessarily indicate when the investments in mortgage loans will
be realized in cash.

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The following is a schedule by geographic location of investments in mortgage
loans as of:

|           |  |               |            |            |  |                    |        |            |  |   |            |  |  |  |        |  
|---------- |  | ------------- | ---------- | ---------- |  | ------------------ | ------ | ---------- |  | - | ---------- |  |  |  | ------ | -
|           |  | June 30, 2003 |            | Portfolio  |  | September 30, 2002 |        | Portfolio 
|           |  | Balance       |            | Percentage |  | Balance            |        | Percentage
|           |  |               |            |            |  |                    |        |           
|Arizona    |  | $             | 9,256,502  |            |  |                    | 13.62  | %          |  | $ | 16,225,981 |  |  |  | 17.79  | %
|California |  |               | 6,311,656  |            |  |                    | 9.29   | %          |  |   | 1,247,876  |  |  |  | 1.37   | %
|Colorado   |  |               | 163,333    |            |  |                    | 0.24   | %          |  |   | 983,217    |  |  |  | 1.08   | %
|Florida    |  |               | 115,450    |            |  |                    | 0.17   | %          |  |   |           |  |  |  | 0.00   | %
|Hawaii     |  |               | 9,238,661  |            |  |                    | 13.60  | %          |  |   | 11,750,000 |  |  |  | 12.88  | %
|Nevada     |  |               | 24,516,937 |            |  |                    | 36.08  | %          |  |   | 43,288,748 |  |  |  | 47.47  | %
|New Mexico |  |               | 478,829    |            |  |                    | 0.70   | %          |  |   | 1,157,505  |  |  |  | 1.27   | %
|Ohio       |  |               | 400,000    |            |  |                    | 0.59   | %          |  |   |           |  |  |  |       | %
|Texas      |  |               | 12,659,652 |            |  |                    | 18.63  | %          |  |   | 11,568,971 |  |  |  | 12.69  | %
|Utah       |  |               | 3,369,010  |            |  |                    | 4.96   | %          |  |   | 3,369,010  |  |  |  | 3.69   | %
|Washington |  |               | 1,440,000  |            |  |                    | 2.12   | %          |  |   | 1,600,000  |  |  |  | 1.76   | %
|           |  |               |            |            |  |                    |        |            |  |   |            |  |  |  |        |  
|           |  | $             | 67,950,030 |            |  |                    | 100.00 | %          |  | $ | 91,191,308 |  |  |  | 100.00 | %
|           |  |               |            |            |  |                    |        |            |  |   |            |  |  |  |        |  

The Company has six mortgage loan products consisting of bridge, commercial,
construction, acquisition and development, land, and residential loans. The
effective interest rates on all product categories range from 5.5% to 17%.
Revenue by product will fluctuate based upon relative balances during the
period.

At June 30, 2003, seven of the Companys loans totaling $15.3 million were
non-performing (more than 90 days past due on interest payments) or past due on
principal. These loans have been placed on non-accrual of interest status. The
Company has commenced foreclosure proceedings on these loans. One of these
loans totaling $250,000 is included in the participation pool related to
secured borrowing. Pursuant to the terms of an intercreditor agreement, the
Company has continued to remit to the investor the interest due on the
participated amounts. The Companys Manager evaluated all of these loans and
concluded that the underlying collateral was sufficient to protect the Company
against a loss of principal or interest. Accordingly, no specific allowance for
loan losses was deemed necessary for these loans.

In addition to the above-mentioned loans, as of June 30, 2003, the Companys
Manager had granted extensions on 15 loans pursuant to the terms of the
original loan agreements, which permit extensions by mutual consent. Such
extensions are generally provided on loans where the original term was 12
months or less and where a borrower requires additional time to complete a
construction project or negotiate take out financing. The aggregate amount due
to the Company from borrowers whose loans had been extended as of June 30, 2003
was approximately $22.7 million. The Companys Manager concluded that no
allowance was necessary with respect to these loans.

The Companys Manager has evaluated the collectibility of the loans in light of
the types and dollar amounts of loans in the portfolio, adverse situations that
may affect the borrowers ability to repay, prevailing economic conditions and
the underlying collateral securing the loan. The Companys Manager believes
that the allowance for loan losses totaling $400,000 included in the
accompanying balance sheet as of June 30, 2003 is adequate to address estimated
credit losses in the Companys investment in mortgage loan portfolio as of that
date.

Decisions regarding an allowance for loan losses require managements judgment.
As a result, there is an inherent risk that such judgment will prove incorrect.
In such event, actual losses may exceed (or be less than) the amount of any
allowance. To the extent that the Company experiences losses greater than the
amount of its allowance, the Company may incur a charge to its earnings that
will adversely affect its operating results and the amount of any distributions
payable to its members.

On June 25, 2003, the Company refinanced a $15.2 million note due on August 19,
2003 as a new note with the interest rate reduced from 11.0% to 5.5% as a debt
restructuring. The new loan has a term of 24 months.

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NOTE D  RELATED PARTY TRANSACTIONS

For the three and nine months ended June 30, 2003 and 2002, the Company
recorded management fees to the Companys Manager of approximately $63,796 and
$189,304, respectively, compared to $62,342 and $248,110 for the same periods
in 2002. Additionally, for the three and nine months ended June 30, 2003, the
Company recorded pro rata distributions owed to the Companys Manager of
$25,150 and $81,183 based upon the total of 100,000 units owned by the
Companys Manager.

On March 31, 2003, the Company recorded a note receivable from its Manager
totaling $723,763. The note is unsecured, bears interest at 6%, matures on
September 30, 2003, and requires five equal monthly payments totaling $147,668
beginning on May 31, 2003. The note constitutes a capital contribution made by
the Manager to restore the value of the members capital accounts in Fund I to
approximately $10 per unit. No units were issued to the Manager in
consideration of this capital contribution. The Company made the payment due
June 30, 2003 on July 1, 2003. The balance on this note as of June 30, 2003
totaled $583,347.

During the nine months ended June 30, 2003, the Company purchased $14,249,950
in investments in mortgage loans from Fund II, $3,700,000 from Vestin Group,
Inc., $478,829 from the Manager and $809,307 from other related parties. For
the same period, the Company sold $17,460,213 in investments in mortgage loans
to Fund II, $4,500,000 to Vestin Group, Inc., and $290,938 to other related
parties wholly-owned by Vestin Group, Inc.s Chief Executive
Officer.

During the nine months ended June 30, 2003, the Company sold real estate held
for sale of $1.6 million to Vestin Group, Inc. No gain or loss was recorded on
this sale.

During the quarter ended March 31, 2003, the Company received a capital
contribution from the Companys Manager of $1.6 million to increase the
members capital account to approximately $10 per unit. The contribution
included a note receivable totaling $723,763, which bears interest at 6% and
requires five equal monthly payments totaling $147,668 beginning on May 31,
2003. The contribution also included the forgiveness of management fees and
other amounts payable to the Manager of $876,237.

NOTE E  REAL ESTATE HELD FOR SALE

At June 30, 2003, the Company had seven properties with a total carrying value
of $18.2 million, net of valuation allowances, which were acquired through foreclosure
and recorded as investments in real estate held for sale. The Company may
share ownership of such properties with Fund II, the Manager, or other
unrelated parties. The summary below includes the Companys percentage
ownership in each property. These investments in real estate held for sale are
accounted for at the lower of cost or fair value less costs to sell with fair
value being based on appraisals and knowledge of local market conditions. It
is not the Companys intent to invest in or own real estate as a long-term
investment. The Company seeks to sell properties acquired through foreclosure
as quickly as circumstances permit. The following is a summary of real estate
held for sale as of June 30, 2003:

|                                                                       |  |                |    |       |  |                   |            | 
|---------------------------------------------------------------------- |  | -------------- | -- | ----- |  | ----------------- | ---------- | 
|                                                                       |  |                |    |       |  | Adjusted Carrying
|Description                                                            |  | % of Ownership |    | Value
|                                                                       |  |                |    |      
|Raw land in Mesquite, Nevada                                           |  |                | 58 | %     |  | $                 | 2,796,137  | 
|40 acres of land containing 354 residential lots in Henderson, Nevada  |  |                | 68 | %     |  |                   | 10,393,116 | 
|A 36-unit apartment complex located in Las Vegas, Nevada,              |  |                | 17 | %     |  |                   | 215,431    | 
|65 acres of raw land in Mesquite, Nevada                               |  |                | 59 | %     |  |                   | 1,342,263  | 
|A custom residential property located in Santa Fe, New Mexico          |  |                | 93 | %     |  |                   | 1,191,055  | 
|An uncompleted golf course in Mesquite, Nevada                         |  |                | 64 | %     |  |                   | 2,171,812  | 
|An approximate 200-unit apartment complex located in Las Vegas,
Nevada |  |                | 2  | %     |  |                   | 112,312    | 
|                                                                       |  |                |    |       |  |                   |            | 
|Total                                                                  |  |                |    |       |  | $                 | 18,222,126 | 
|                                                                       |  |                |    |       |  |                   |            | 

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The Company entered into an agreement for the sale of a portion of the
Companys interest in 40 acres of land containing 354 residential lots in
Henderson, Nevada. The agreement requires the buyer to purchase 138 lots for
cash and gives the buyer an option to purchase the remaining 216 lots over the
next three years at a predetermined price, which may be adjusted for potential
value increases. The buyer completed the purchase of the 138 lots on July 14,
2003. The Company recorded a valuation adjustment as of June 30, 2003 in the
amount of $1,748,771 to adjust the carrying value of the Companys interest in
the parcel to the amount corresponding to the negotiated sale and option price.

The Company entered into an agreement to sell the uncompleted golf course, 65
acres of raw land and an additional parcel of raw land in Mesquite, Nevada.
The Company expects to close the sale in August 2003. The Company recorded a
valuation adjustment as of June 30, 2003 in the amount $1,563,599 to adjust the
carrying value of the Companys interest in these properties to the amount
corresponding to the sales agreement. After the sale, the Company will have
remaining a 58% interest in 28 acres of commercial land in Mesquite, Nevada
valued at approximately $2.3 million.

Through foreclosure proceedings in the first calendar quarter of 2003, the
Company assumed an approximate 2% ownership of a 200-unit apartment complex as
described above. The other 98% is owned by Fund II. The Company has engaged an
outside management company to manage the apartment complex, pending its sale.
The Companys share of income from operations for the nine months ended June
30, 2003 totaled $659 which is included in other income on the accompanying
statements of income.

NOTE F  SECURED BORROWING

As of June 30, 2003, the Company had $3.1 million in secured borrowings
pursuant to an intercreditor agreement with the related amounts included in
assets under secured borrowing. For the three and nine month periods ended
June 30, 2003, the Company recorded interest expense of $138,627 and $486,207,
respectively, related to the secured borrowing.

NOTE G NOTE RECEIVABLE

The Company received a note receivable from an unaffiliated borrower in the
amount of $4,666,667 in connection with the sale of real estate. The note requires
monthly interest payments at a rate of 8.5% per annum and is payable in full on
June 13, 2005. The note is personally guaranteed by the owner of the borrower
and is secured by a second deed of trust on 756 acres purchased by the
borrower. The note resulted
from the Companys
financing of a mortgage note due June 13, 2004, from
the borrower for the sale of real estate located in the City of
Mesquite, Nevada. The Company is using the cost recovery method of accounting
for the financing. Accordingly, the Company
will not recognize any income or the note receivable related to this transaction until the principal
balance of the underlying notes are paid in full. Payments received by
the Company in excess of the principal balance will be recorded as income when,
and if, received.

NOTE H  DEFERRED BOND OFFERING COSTS

At June 30, 2003 the Company
expensed previously deferred bond offering costs in the
amount of $223,394. The Companys Manager determined that due to the current
interest rate environment, it is not feasible to proceed with the
securitization of certain of the Companys mortgage loans through the sale of
bonds secured by those mortgages, and accordingly, has expensed the costs
incurred to date.

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NOTE I  NEW ACCOUNTING PRONOUNCEMENTS

In January 2003, the FASB issued Interpretation No. 46, Consolidation of
Variable Interest Entities(FIN 46), which addresses consolidation by
business enterprises of variable interest entities (VIEs). The accounting
provisions and expanded disclosure requirements for VIEs are effective at
inception for VIEs created after January 31, 2003, and are effective for
reporting periods beginning after June 15, 2003 for VIEs created prior to
February 1, 2003. An entity is subject to consolidation according to the
provisions of FIN 46 if, by design, either (i) the total equity investment at
risk is not sufficient to permit the entity to finance its activities without
additional subordinated financial support from other parties, or (ii) as a
group, the holders of the equity investment at risk lack: (a) direct or
indirect ability to make decisions about an entitys activities (b) the
obligation to absorb the expected losses of the entity if they occur; or (c)
the right to receive the expected residual returns of the entity if they occur.
In general, FIN 46 will require a VIE to be consolidated when an enterprise
has a variable interest that will absorb a majority of the VIEs expected
losses or receive a majority of the VIEs expected residual return.
The Company continues to evaluate its relationships and interest in
entities that may be considered VIEs. The impact of adopting FIN 46 on the
Consolidated Financial Statements is still being reviewed.

NOTE J  LITIGATION INVOLVING THE MANAGER

The Company, Vestin Mortgage and Del Mar Mortgage, Inc., (Del Mar Mortgage),
a company wholly owned by Mike Shustek, the largest shareholder and CEO of the
Company, and various affiliates of the Company are defendants in a civil action
(the Action). On April 10, 2003, the United States District Court for the
District of Nevada (the Court) entered a judgment in the Action for $5.0
million, plus interest accruing from March 26, 2003, jointly and severally
against the Company, Vestin Mortgage and Del Mar Mortgage. Subsequent to April
10, 2003, the Court stayed the execution of the judgment pending the hearing
and ruling on post-trial motions, and accordingly, the Court did not require the
defendants to post a bond for the judgment. The hearing was held on August 6,
2003, at which time the Court denied the motion for reconsideration and held
that the defendants are jointly and severably liable for the judgment plus
interest as well as attorneys fees in the amount of $660,000. Del Mar Mortgage
has agreed to indemnify the Company and Vestin Mortgage for any losses and expenses in
connection with the Action. Mr. Shustek has guaranteed the indemnification.
Mr. Shustek has agreed to provide a bond in the amount of the judgment. The
defendants intend to appeal the ruling to the United States Ninth Circuit Court
of Appeals.

NOTE K  DISTRIBUTION LIMITATION

In order to comply with the Companys operating agreement and Federal tax
statutes, the Company discontinued accepting requests for the redemption of units for the 2003
calendar year as of June 17, 2003. All distribution requests received after
that date have been logged for distribution beginning in January 2004.

NOTE L  SUBSEQUENT EVENTS

On July 25, 2003, the Company foreclosed on a mortgage loan
that was delinquent
in its payments and had violated its forbearance agreement. As a result, the
Company now owns a 43% interest in the collateral property which is a 162-bed
assisted living facility in Las Vegas, Nevada. The remaining 57% is
owned by Fund II. The facility is estimated to be
95% complete. Based on the appraisal and site inspections, the Company believes the value of the property exceeds its
carrying value of $4.9 million.

On July 22, 2003 the Company entered into a stipulation with a borrower which
among other things reduced the interest rate to 7% from 12.5% on the principal
balance of $2,000,000, (which represents a 10% interest in a first trust deed
of $20,000,000) deferred interest payments through October 31, 2003, and
extended the maturity date from June 14, 2003 to June 14, 2005. The borrower
filed Chapter 11 Bankruptcy on June 26, 2003. The United States Bankruptcy
Court approved the stipulation. In the event of default of the stipulation by
the borrower, the automatic bankruptcy stay will be lifted and the Company will
be allowed to complete a foreclosure sale of the collateral. As approved by
the United States Bankruptcy Court, Fund II and a third-party
participant have
advanced an additional $2,200,000 of post petition financing. The
Company did not fund any portion of this advance.

14



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

BACKGROUND

Vestin Fund I, LLC (the Company) was organized in December 1999 as a Nevada
limited liability company, for the purpose of investing in mortgage loans
originated by the Companys Manager, Vestin Mortgage, Inc. a licensed mortgage
company in the State of Nevada (the Manager). Vestin Mortgage is a
wholly-owned subsidiary of Vestin Group, Inc., a Delaware corporation, whose
common stock is traded on the Nasdaq National Market under the ticker symbol
VSTN. Vestin Mortgage, Inc. is also the manager of Vestin Fund II, LLC, and
inVestin Nevada, Inc. which are entities similar to Vestin Fund I, LLC. The
loans are secured by real estate through deeds of trust and mortgages.

The following is a financial review and analysis of the Companys financial
condition and results of operations for the three and nine month periods ended
June 30, 2003. This discussion should be read in conjunction with the
Companys financial statements and accompanying notes and other detailed
information regarding the Company appearing elsewhere in this Form 10-Q and the
Companys report on Form 10-K for the transition period ended September 30,
2002.

OVERVIEW

The Company commenced raising funds through the sale of its units in September
2000. By June 2001, the Company had sold all of the 10,000,000 units offered
pursuant to the Companys registration statement. No additional units will be
sold to new investors, however, current members may continue to participate in
the Companys Distribution Reinvestment Plan whereby the members distribution
may be used to purchase additional units at $10.00 per unit. As of June 30,
2003, an additional 615,813 units have been purchased under this plan.
Additionally, in connection with the Companys organization, the Company issued
approximately 100,000 units to its Manager for offering costs paid by
the Manager to
unrelated third parties on the Companys behalf.

SUMMARY OF FINANCIAL RESULTS

|                                                                             |  |                             |            |                            |  |      |            |      |  |   |           |   |  |   |           |  
|---------------------------------------------------------------------------- |  | --------------------------- | ---------- | -------------------------- |  | ---- | ---------- | ---- |  | - | --------- | - |  | - | --------- | -
|                                                                             |  | Three months ended June 30, |            | Nine months ended June 30,
|                                                                             |  |                             |            |                           
|                                                                             |  | 2003                        |            | 2002                       |  | 2003 |            | 2002
|                                                                             |  |                             |            |                            |  |      |            |     
|Total revenues                                                               |  | $                           | 2,642,236  |                            |  | $    | 3,043,778  |      |  | $ | 7,810,627 |   |  | $ | 9,897,843 |  
|Total expenses                                                               |  |                             | 4,063,827  |                            |  |      | 79,099     |      |  |   | 4,828,444 |   |  |   | 265,138   |  
|                                                                             |  |                             |            |                            |  |      |            |      |  |   |           |   |  |   |           |  
|Net
income (loss)                                                            |  | $                           | (1,421,591 | )                          |  | $    | 2,964,679  |      |  | $ | 2,982,183 |   |  | $ | 9,632,705 |  
|                                                                             |  |                             |            |                            |  |      |            |      |  |   |           |   |  |   |           |  
|Net
income (loss) allocated to members per
weighted average membership units |  | $                           | (0.15      | )                          |  | $    | 0.29       |      |  | $ | 0.30      |   |  | $ | 1.00      |  
|                                                                             |  |                             |            |                            |  |      |            |      |  |   |           |   |  |   |           |  
|Annualized
rate of return (loss) to members (a)                              |  |                             | (5.9       | %)                         |  |      | 11.6       | %    |  |   | 4.0       | % |  |   | 13.3      | %
|                                                                             |  |                             |            |                            |  |      |            |      |  |   |           |   |  |   |           |  
|Weighted average membership units                                            |  |                             | 9,553,031  |                            |  |      | 10,230,168 |      |  |   | 9,802,259 |   |  |   | 9,635,603 |  
|                                                                             |  |                             |            |                            |  |      |            |      |  |   |           |   |  |   |           |  



|(a) |  | The annualized rate of return
(loss) to members is calculated based upon the net
income (loss) allocated to members per weighted average units as of June 30, 2003
and 2002 divided by the number of months during the period and multiplied
by twelve (12) months, then divided by ten (the $10 cost per unit).
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Three and Nine Months Ended June 30, 2003 Compared To Three and Nine Months Ended June 30, 2002

Total Revenues. For the three and nine months ended June 30, 2003, revenues
totaled $2.6 million and $7.8 million, respectively, compared to $3.0 million
and $9.9 million for the same period in 2002, a decrease of $0.4 million and
$2.1 million or 13.2% and 21.1%, respectively. The decrease in revenue for the
three and nine months ended June 30, 2003 compared to the same periods in the
prior year was primarily due to lower interest income from investment in
mortgage loans for both the three and nine month periods resulting
from the increase in
non-performing assets in 2003 compared to the same periods in 2002. The
Companys non-performing assets at June 30, 2003 totalled

15



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approximately $33.5 million. There were no non-performing assets as of June
30, 2002. Our Manager believes that the increase in non-performing assets is
primarily the result of the individual circumstances of the borrowers involved.
The increase in non-performing assets may also reflect the continuing weakness
in the economy and the risks inherent in our business strategy which entails
more lenient underwriting standards and expedited loan approval procedures.
Our revenues will continue to suffer until we are able to convert these
non-performing assets into interest paying mortgage loans. We will attempt to
accomplish this by working with the borrower where possible and by foreclosing
on the underlying property where necessary. We intend to sell properties
acquired through foreclosure as soon as practicable, consistent with our
objective of avoiding a loss of principal on our loans. However, we cannot
predict how quickly we will be able to sell foreclosed properties.

Total Expenses. For the three and nine months ended June 30, 2003, expenses
totaled $4.1 million and $4.8 million, respectively, compared to $79,099 and
$265,138 for the same periods in 2002, an increase of $4.0 million and $4.6
million, respectively. The increase in total expenses for the three months
ended June 30, 2003 primarily related to valuation adjustments
on certain real estate held for sale, the write off of the deferred bond
offering costs, provision for loan losses, and interest expense totaling
$138,627 related to secured borrowings. For the nine months ended June 30,
2003, the provision for loan losses was $300,000 and the secured borrowings
interest expense was $486,207. Although our Manager believes the current
provision for loan losses is adequate, it is possible that the allowance will
need to be increased if there is further deterioration in our investments in
mortgage loans. Management fees for the three and nine months ended June 30,
2003 totaled $63,796 and $189,304, respectively. Management fees are recorded
monthly based upon 0.25% of aggregate outstanding capital.

Net Income (Loss). Overall, the net loss for the three months ended June 30, 2003
totaled ($1.4 million) with net income for the nine months ended June 30, 2003 of
$3.0 million compared to $3.0 million and $9.6 million, respectively, for the
same period in 2002, a decrease of $4.4 million and $6.6 million or 148.0% and
69.0%, respectively. The decrease was primarily the result of lower revenues
because of the increase in non-performing assets and the write-offs recognized
in the quarter ended June 30, 2003.

Annualized Rate of Return (Loss) to Members. For the three and nine months
ended June 30, 2003, annualized rate of return (loss) to members totaled (5.9)%
and 4.0%, respectively, as compared to 11.6% and 13.3%, respectively for the
same periods in 2002. The year to date decrease in annualized rate of return
to members was primarily the result of the increase in non-performing assets
and the valuation loss on real estate held for sale between June 30, 2002 and
June 30, 2003.

Our operating results are affected primarily by (i) the amount of capital we
have to invest in mortgage loans, (ii) the level of real estate lending
activity in the markets we service, (iii) our ability to identify and work with
suitable borrowers, (iv) the interest rates we are able to charge on our loans
and (v) the level of non-performing assets and loan losses which
we experience. The amount of capital we have to invest in mortgage loans has
been reduced by the increase in non-performing assets discussed above and
redemptions of membership units during the past nine months of approximately
$7.0 million. The Company has discontinued redemption of units for the 2003
calendar year as of June 17, 2003. Redemptions made and redemption requests
received before June 17, 2003 for 2003 totalled $8,980,880 at August 11, 2003.
All redemption requests received after June 17, 2003 have been scheduled for
distribution beginning in 2004.

The US economy has suffered from a mild recession over the recent past few
years, and we have experienced a slowdown in commercial real estate lending in
the markets we service. A prolonged recession may continue to dampen real
estate development activity, thereby diminishing the market for our loans. In
addition, the continuing decline in interest rates, which is largely
attributable to the weak economy, may be expected to diminish the interest
rates we can charge on our loans. The average interest rate on our loans at
June 30, 2003 was 13.09%, as compared to 13.58% at September 30, 2002.
Moreover, a prolonged recession or poor credit decisions by our Manager may
continue the increase in non-performing assets. This increase in
non-performing
assets has contributed to the decline in our annualized rate of return to
members from 13.3% for the nine months ended June 30, 2002 to 4.0% for the nine
months ended June 30, 2003.

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INVESTMENTS IN MORTGAGE LOANS SECURED BY REAL ESTATE PORTFOLIO

As of June 30, 2003, the Company invested in mortgage loans secured by real
estate totaling $67,950,030, including 49 loans with an aggregate principal
value of $67,945,030 secured by first deeds of trust. One loan is also secured
by a second deed of trust totaling $5,000. The Companys second mortgage is
junior to a first trust deed position held by the Company.

As of June 30, 2003, the weighted average contractual interest yield on the
Companys investment in mortgage loans is 13.09%. These mortgage loans have
contractual maturities within the next 24 months.

Losses may occur from investing in mortgage loans. The amount of losses will
vary as the loan portfolio is affected by changing economic conditions and the
financial position of borrowers.

The conclusion that a mortgage loan is uncollectible or that collectibility is
doubtful is a matter of judgment. On a quarterly basis, the Manager evaluates
the Companys mortgage loan portfolio for impairment. The fact that a loan is
temporarily past due does not necessarily mean that the loan is impaired.
Rather, all relevant circumstances are considered by the Manager to determine
impairment and the need for specific reserves. This evaluation considers among
other matters:



| |  | prevailing economic conditions;                                                                         
|- |  | --------------------------------------------------------------------------------------------------------
| 
| |  | historical experience;                                                                                  
| 
| |  | the nature and volume of the loan portfolio;                                                            
| 
| |  | the borrowers financial condition and adverse situations that may affect the borrowers ability to pay;
| 
| |  | evaluation of industry trends;                                                                          
| 
| |  | review and evaluation of loans identified as having loss potential; and                                 
| 
| |  | estimated fair value of any underlying collateral.                                                      

Based upon this evaluation the Companys Manager believes that the allowance
for loan losses totaling $400,000 included in the accompanying balance sheet as
of June 30, 2003 is adequate to meet estimated credit losses.

Decisions regarding an allowance for loan losses require judgment about the
probability of future events. As a result, there is an inherent risk that such
judgment will prove incorrect. In such event, actual losses may exceed (or be
less than) the amount of any allowance. To the extent that the Company
experiences losses greater than the amount of its allowance, the Company may
incur a charge to its earnings that will adversely affect its operating results
and the amount of any distributions payable to its members.

CRITICAL ACCOUNTING POLICIES

Revenue Recognition

Interest income on loans is accrued by the effective interest method. The
Company does not recognize interest income from loans once they are determined
to be impaired. A loan is impaired when, based on current information and
events, it is probable that the Company will be unable to collect all amounts
due according to the contractual terms of the loan agreement or when the
payment of interest is 90 days past due.

Real Estate Held For Sale

Real estate held for sale includes real estate acquired through foreclosure and
is carried at the lower of cost or the propertys estimated fair value, less
estimated costs to sell.

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Investments in Mortgage Loans

Investments in mortgage loans are secured by trust deeds and mortgages.
Generally, all of the Companys mortgage loans require interest only payments
with a balloon payment of the principal at maturity. The Company has both the
intent and ability to hold mortgage loans until maturity and therefore,
mortgage loans are classified and accounted for as held for investment and are
carried at cost. Loans sold to or purchased from affiliates are
accounted for at the principal balance and no gain or loss is
recognized by the Company or any affiliate. Loan to value ratios are based on appraisals obtained at the
time of loan origination and may not reflect subsequent changes in value
estimates. Such appraisals are generally dated within 12 months of the date of
loan origination. The appraisals may be for the current estimate of the as-if
developed value of the property, which approximates the post-construction
value of the collateralized property assuming that such property is developed.
As-if developed values on raw land loans or acquisition and development loans
often dramatically exceed the immediate sales value and may include anticipated
zoning changes and timely successful development by the purchaser. As most of
the appraisals will be prepared on an as-if developed basis, if a loan goes
into default prior to any development of a project, the market value of the
property may be substantially less than the appraised value. As a result,
there may be less security than anticipated at the time the loan was originally
made. If there is less security and a default occurs, the Company may not
recover the full amount of the loan.

Allowance for Loan Losses

The Company maintains an allowance for loan losses on its investment in
mortgage loans for estimated credit impairment in the Companys investment in
mortgage loans portfolio. The Managers estimate of losses is based on a number
of factors including the types and dollar amounts of loans in the portfolio,
adverse situations that may affect the borrowers ability to repay, prevailing
economic conditions and the underlying collateral securing the loan. Additions
to the allowance are provided through a charge to earnings and are based on an
assessment of certain factors which may indicate estimated losses on the loans.
Actual losses on loans are recorded as a charge-off or a reduction to the
allowance for loan losses. Subsequent recoveries of amounts previously charged
off are added back to the allowance.

Secured Borrowing

Loans that have been participated to third party investors through an
intercreditor agreement (Agreement) are accounted for as secured borrowings
in accordance with SFAS No. 140, Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities(SFAS No. 140). Under the
Agreement, investors may participate in certain loans with Vestin Mortgage,
Fund II, and the Company (collectively, the Lead Lenders). In the event of
borrower non-performance, the intercreditor agreement gives the Lead Lenders
the right to either (i) continue to remit to the investor the interest due on
the participation amount; (ii) substitute an alternative loan acceptable to the
investor; or (iii) repurchase the participation from the investor for the
outstanding balance of the participation plus accrued interest. Consequently,
the Investor is in a priority lien position against the collateralized loans
and mortgage loan financing under the participation arrangement is accounted
for as a secured borrowing in accordance with SFAS No. 140.

CAPITAL AND LIQUIDITY

Liquidity is a measure of a companys ability to meet potential cash
requirements, including ongoing commitments to fund lending activities and for
general operational purposes. The Company believes that interest earned from
both investment loans and cash held at bank institutions in the next twelve
months will be sufficient to meet the Companys capital requirements. The
Company does not anticipate the need for hiring any employees, acquiring fixed
assets such as office equipment or furniture, or incurring material office
expenses during the next twelve months because the Manager will continue to
manage the Companys affairs. The Company is charged by the Manager a monthly
management fee of up to 0.25% of the Companys aggregate capital contributions.
Pursuant to the Companys Operating Agreement, the Company recorded management
fees to the Manager during the three and nine months ended June 30, 2003 of
$63,796 and $189,304, respectively.

During the nine months ended June 30, 2003, cash flows provided by operating
activities approximated $7.2 million. Investing activities consisted of cash
provided by sales and used in purchases of investments in mortgage loans

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approximating $2.7 million, $1.1 million in proceeds from the sale of real
estate held for sale and the maturity of certificates of deposit approximating
$1.3 million. Financing activities consisted of members withdrawals in the
amount of $7.0 million and distributions of $6.3 million (net of
reinvestments).

As of June 30, 2003, members holding approximately 29% of our outstanding units
have elected to reinvest their dividends. The level of dividend reinvestment
will depend upon our performance as well as the number of our members who
prefer to reinvest rather than receive current distributions of their income.

Any significant level of defaults on our outstanding loans could reduce the
funds we have available for investment in new loans. Foreclosure proceedings
may not generate full repayment of our loans and may result in significant
delays in the return of invested funds. This would diminish our capital
resources and would impair our ability to invest in new loans. In addition,
any significant level of withdrawals by our Members would reduce the capital we
have available for investment. Such withdrawals, which totaled approximately
$7.0 million for the nine months ended June 30, 2003, are limited by the terms
of our Operating Agreement to not more than 10% per calendar year and are
subject to other conditions. In order to comply with the Companys operating
agreement and Federal tax statutes, the Company discontinued the redemption of
units for the 2003 calendar year as of June 17, 2003. All distribution
requests received after that date have been logged for distribution beginning
in January 2004.

Non-performing assets, which include loans on non-accrual (discussed in Note C)
and real estate held for sale (discussed in Note E), totaled $33.5 million at
June 30, 2003. It is possible that no earnings will be recognized from these
assets until they are disposed of, and the time it will take to dispose of
these assets cannot be predicted.

On June 25, 2003, the Company refinanced a $15.2 million note due on August 19,
2003 as a new note with the interest rate reduced from 11.0% to 5.5% as a debt
restructuring. The new loan has a term of 24 months.

Our Manager believes that total non-performing assets at June 30, 2003 have
increased since our year ended September 30, 2002, primarily as a result of
factors unique to specific borrowers. Because of the estimated value of the
underlying properties, the Company does not believe that any losses beyond
those already recognized will be incurred from these assets upon final
disposition. However, it is possible that the Company will not be able to
realize the full estimated carrying values upon disposition, particularly if
continuing economic weakness results in declining real estate values.

At June 30, 2003, the Company had $1.7 million in cash, $1.5 million in
certificates of deposit, and $93.6 million in total assets. It appears the
Company has sufficient working capital to meet its operating needs in the near
term.

As of June 30, 2003, the Company had liabilities totaling $3.1 million as
secured borrowings related to an intercreditor agreement. Pursuant to the
intercreditor agreement, the Investor may participate in certain loans with
Vestin Mortgage, Fund I, and the Company (collectively, the Lead Lenders).
In the event of borrower non-performance, the intercreditor agreement gives the
Lead Lenders the right to either (i) continue to remit to the investor the
interest due on the participation amount; (ii) substitute an alternative loan
acceptable to the investor; or (iii) repurchase the participation from the
investor for the outstanding balance of the participation plus accrued
interest. Consequently, mortgage loan financing under the participation
arrangement is accounted for as a secured borrowing in accordance with SFAS No.
140, Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities.

The Company maintains working capital reserves of approximately 3% of aggregate
members capital accounts in cash and cash equivalents, and certificates of
deposit. This reserve is available to pay expenses in excess of revenues,
satisfy obligations of underlying security properties, expend money to satisfy
unforeseen obligations and for other permitted uses of the working capital.
Working capital reserves of up to 3% are included in the funds committed to
loan investments in determining what proportion of the offering proceeds and
reinvested distributions have been invested in mortgage loans.

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FACTORS AFFECTING THE COMPANYS OPERATING RESULTS

The Companys business is subject to numerous factors affecting its operating
results. In addition to the factors discussed above, the Companys operating
results may be affected by:

Risks of Investing in Mortgage Loans



| |  |  | The Companys underwriting standards and procedures are more lenient
than conventional lenders in that the Company will invest in loans to
borrowers who will not be required to meet the credit standards of
conventional mortgage lenders.                                                                                                                                                                                                                                                                                                                                               
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The Company approves mortgage loans more quickly then other mortgage
lenders. Due to the nature of loan approvals, there is a risk that the
credit inquiry the Companys Manager performs will not reveal all
material facts pertaining to the borrower and the security.                                                                                                                                                                                                                                                                                                                  
|
| |  |  | Appraisals may be performed on an as-if developed basis. Therefore
there is a risk that the borrower will not complete development of the
project which may affect the expected value of the property and the loan
to value ratio.                                                                                                                                                                                                                                                                                                                                                       
|
| |  |  | The Companys results of operations will vary with changes in
interest rates and with the performance of the relevant real estate
markets.                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| |  |  | If the economy is healthy, the Company expects that more people will
be borrowing money to acquire, develop or renovate real property.
However, if the economy grows too fast, interest rates may increase too
much and the cost of borrowing may become too expensive. This could
result in a slowdown in real estate lending which may mean the Company
will have fewer loans to acquire, thus reducing the Companys revenues
and the distributions to members.                                                                                                                         
|
| |  |  | If, at a time of relatively low interest rates, a borrower should
prepay obligations that have a higher interest rate from an earlier
period, investors will likely not be able to reinvest the funds in
mortgage loans earning that higher rate of interest. In the absence of a
prepayment fee, the investors will receive neither the anticipated
revenue stream at the higher rate nor any compensation for their loss.
This in turn could harm the Companys reputation and make it more
difficult for the Company to attract investors willing to acquire
interest in mortgage loans.

Risk of Defaults

The Companys performance will be directly impacted by any defaults on the
loans in its portfolio. As noted above, the Company may experience a higher
rate of defaults than conventional mortgage lenders. The Company seeks to
mitigate the risk by estimating the value of the underlying collateral and
insisting on low loan to value ratios. However, no assurance can be given that
these efforts will fully protect the Company against losses on defaulted loans.
Moreover, during the period of time when a defaulted loan is the subject of
foreclosure proceedings, it is likely that the Company will earn less (if any)
income from such loans, thereby reducing the Companys earnings.

Competition for Borrowers

The Company considers its competitors for borrowers to be the providers of
non-conventional mortgage loans, that is, lenders who offer short-term,
equity-based loans on an expedited basis for higher fees and rates than those
charged by conventional lenders and mortgage loans investors, such as
commercial banks, thrifts, conduit lenders, insurance companies, mortgage
brokers, pension funds and other financial institutions that offer conventional
mortgage loans. Many of the companies against which the Company competes have
substantially greater financial, technical and other resources than the Company
does. Competition in the Companys market niche depends upon a number of
factors including price and interest rates of the loan, speed of loan
processing, cost of capital, reliability, quality of service and support
services.

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Effect of Fluctuations in the Economy

The Companys sole business, making loans secured by real estate, is
particularly vulnerable to changes in macroeconomic conditions. Any significant
decline in economic activity, particularly in the geographical markets in which
the Company concentrates its loans, could result in a decline in the demand for
real estate development loans. In order to stay fully invested during a period
of declining demand for real estate loans, the Company may be required to make
loans on terms less favorable to the Company or to make loans involving greater
risk to the Company. Declines in economic activity are often accompanied by a
decline in prevailing interest rates. Although the Companys lending rates are
not directly tied to the Federal Reserve Boards discount rate, a sustained and
widespread decline in interest rates will impact the interest the Company is
able to earn on its loans. Since the Companys loans generally do not have
prepayment penalties, declining interest rates may also cause the Companys
borrowers to prepay their loans and the Company may not be able to reinvest the
amounts prepaid in loans generating a comparable yield. Moreover, any
significant decline in economic activity could adversely impact the ability of
the Companys borrowers to complete their projects and obtain take out
financing. This in turn could increase the level of defaults the Company may
experience.

FORWARD LOOKING STATEMENTS

When used in this Quarterly Report on Form 10-Q the words or phrases will
likely result, are expected to, is anticipated, or similar expressions are
intended to identify forward looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements are subject
to certain risks and uncertainties, including but not limited to changes in
interest rates, and fluctuations in operating results. Such factors which are
discussed in Managements Discussion and Analysis of Financial Condition and
Results of Operations, could affect the Companys financial performance and
could cause the Companys actual results for future periods to differ
materially from any opinion or statements expressed herein with respect to
future periods. As a result, the Company wishes to caution readers not to place
undue reliance on any such forward looking statements, which speak only as of
the date made.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is exposed to market risk, primarily from changes in interest
rates. The Company does not have any assets or liabilities denominated in
foreign currencies nor does it own any options, futures or other derivative
instruments.

Most of the Companys assets consist of mortgage loans, including those which
are financed under the intercreditor agreement. At June 30, 2003, the
Companys aggregate investment in mortgage loans was $67,950,030 with a
weighted average contractual yield of 13.09%. Loans financed under the
intercreditor agreement totaled $3,070,357 at June 30, 2003 and are classified
as assets under secured borrowing. Such financing is at a weighted average
contractual interest rate of 13.10%. These mortgage loans mature within the
next 24 months. All of the outstanding mortgage loans at June 30, 2003 are
fixed rate loans. All of the mortgage loans are held for investment purposes.
None of the mortgage loans have prepayment penalties.

As of June 30, 2003, the Company had cash and investments in certificates of
deposit and other short-term deposit accounts totaling $3.2 million. The
Company anticipates that approximately 3% of its assets will be held in such
accounts as a cash reserves. Additional deposits in such accounts will be made
as funds are received by the Company from new investors and repayment of loans
pending the deployment of such funds in new mortgage loans. The Company
believes that these financial assets do not give rise to significant interest
rate risk due to their short-term nature.

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ITEM 4. CONTROLS AND PROCEDURES.

The Company has evaluated the effectiveness of the design and operation of its
disclosure controls and procedures as of June 30, 2003 (the Evaluation Date).
Such evaluation was conducted under the supervision and with the participation
of the Chief Executive Officer (CEO) and the Chief Financial Officer (CFO)
of Vestin Mortgage, Inc., the Companys Manager, who function as the equivalent
of the CEO and CFO of the Company. Based upon such evaluation, the Companys
CEO and CFO have concluded that, as of the Evaluation Date, the Companys
disclosure controls and procedures were effective. There have been no
significant changes in the Companys internal controls over financial reporting
that occurred during the Companys most recent fiscal quarter, that have
materially affected, or are reasonable likely to materially affect, the
Companys internal controls over financial reporting.

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PART II

OTHER INFORMATION




ITEM 1. LEGAL PROCEEDINGS

None




ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

Not Applicable.




ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not Applicable.




ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matter was submitted to a vote of security holders, through the solicitation
of proxies or otherwise, during the third quarter ended June 30, 2003.




ITEM 5. OTHER INFORMATION

None.




ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K



|(a) |  | Exhibits
|--- |  | --------

|     |  |                                                 
|---- |  | ------------------------------------------------
|2.1  |  | Articles of Organization*                       
|10.1 |  | Operating Agreement**                           
|31.1 |  | Section 302 Certification of Michael V. Shustek 
|31.2 |  | Section 302 Certification of Lance Bradford     
|32   |  | Certification Pursuant to U.S.C. 18 Section 1350



---

|*  |  | Previously filed as an exhibit to the Registration Statement on Form S-11
(File No. 333-32800) on March 17, 2000.                         
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------
|  
|** |  | Previously filed as an exhibit to the Amendment No. 4 to the Registration
Statement on Form S-11/A (File No. 333-32800) on August 7, 2000.



|(b) |  | Reports on Form 8-K
|--- |  | -------------------



| |  | None.
| |  | -----

24



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##### Table of Contents






SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

VESTIN FUND I, LLC

By: Vestin Mortgage, Inc., its sole manager

| |  |     |  |                                         
| |  | --- |  | ----------------------------------------
| |  | By: |  | /s/ Lance K. Bradford                   
| |  |     |  |                                         
| |  |     |  | Lance K. Bradford                       
| |  |     |  | Director, Secretary and Treasurer       
| |  |     |  | (Chief Accounting Officer of the Manager
| |  |     |  | and Duly Authorized Officer)            

Dated: August 14, 2003

25