<PAGE>
The  registrant  is  filing  restated  1994-1997  financial  statements.   These
restatements  reflect changes discussed in Note 7 to the consolidated  financial
statements.
<PAGE>


                     U S SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20529


                                  FORM 10-KSB

[X]     Annual report pursuant to Section 13 or 15(d) of the Securities Exchange
        Act of 1934 (Fee Required) For the fiscal year
        ended December 31, 1998

[ ]     Transition report pursuant to Section 13  or  15(d)  of  the  Securities
        Exchange Act of 1934. For the transition period from _______ to________.

                          Commission File No. 33-39238


                          TMP LAND MORTGAGE FUND, LTD.
                        A CALIFORNIA LIMITED PARTNERSHIP
             (Exact name of registrant as specified in its charter)

         CALIFORNIA                                       33-0451040
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)

                      801 North Parkcenter Drive, Suite 235
                           Santa Ana, California 92705
           (Address of principal executive office, including Zip Code)

                                 (714) 836-5503
              (Registrant's telephone number, including Area Code)

                             ----------------------

Securities to be registered pursuant to Section 12(b) of the Act:

         Title of each class                   Name of each exchange on which
         to be registered                      each class is to be registered
         ----------------                      ------------------------------
              N/A                                            N/A

Securities to be registered pursuant to Section 12(g) of the Act:

                      UNITS OF LIMITED PARTNERSHIP INTEREST
                      -------------------------------------
                                (Title of Class)

Indicate by check mark whether the registrant has (1) 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 [ ]


<PAGE>


                                     PART 1

ITEM 1   BUSINESS

TMP  Land  Mortgage  Fund,  Ltd.,  (the  Partnership)  is a  California  Limited
Partnership  formed  in  November  1991,  of  which  TMP  Investments,  Inc.,  a
California  Corporation,  and TMP Properties,  a California General Partnership,
are the  general  partners.  The  Partnership  was  formed  principally  to make
short-term  loans  to  unaffiliated  parties  secured  by first  trust  deeds on
unimproved  properties,   primarily  in  the  Inland  Empire  area  of  Southern
California,  and to provide cash distributions on a current basis to the limited
partners,  primarily from interest earned on the mortgage loans. The Partnership
is not a mutual fund or any other type of Investment  Company within the meaning
of, and is not subject to regulations under, the Investment Company Act of 1940.
As of December 31, 1998, twelve loans had been made by the Partnership.

Beginning in November 1991, the Partnership was engaged in the offering of up to
20,000  units of limited  partnership  Units  ("Units")  at a purchase  price of
$1,000 per unit pursuant to a Registration  Statement on Form S-11. On April 22,
1994, the Partnership had received and accepted  subscriptions  of 15,715 Units,
representing total subscription  proceeds in the amount of $15,715,000,  and the
offering  was  closed.  Upon  the  conclusion  of  the  offering,   all  of  the
subscription  proceeds  had been  committed  to the  mortgage  loan  investments
described below and working capital reserves.

The Partnership was organized to originate and make loans secured by first deeds
of trust (commonly known as "mortgages") on unimproved real properties primarily
in the Inland Empire area of Southern California, which is located approximately
60 miles east of the city of Los  Angeles  and 40 miles north of the City of San
Diego.  Twelve loans were made for terms of between 6 months and 36 months.  The
Partnership does not intend to make any further loans other than those described
below.  Each  loan was made to an  unaffiliated  borrower  who (i) paid a fee or
"points" to obtain the loan,  (ii)  established  a reserve that would secure the
payment of the interest  for the interim term of the loan,  and (iii) was to pay
the  entire  principal  amount  of the loan in one lump  sum  payment,  commonly
referred to as a "balloon"  payment,  at the end of the loan term. Each loan was
made to an  unaffiliated  borrower  who (i)  used  the  proceeds  of the loan to
purchase or refinance a property the general  partners  believe has  development
potential;  (ii)  "predevelop"  the  property  by  obtaining  zoning  and  other
governmental  approvals needed to permit  construction of single or multi-family
residences or commercial buildings on the property  ("predevelopment  work") and
(iii) on  completion  of the  predevelopment  work,  either sell the property to
developers or contractors or obtain new financing on the property.

It was intended that the  Partnership's  loans would be repaid from the proceeds
either  of the  sale or a  refinancing  of the  property  by the  borrower.  The
Partnership  does not participate in any profit that the borrower may realize on
the sale or refinancing of the property.  Instead, the Partnership would receive
from the  proceeds  of the sale or  refinancing,  the  principal  amount  of the
Partnership's  loan and any interest that had been earned, but not paid, through
the date of sale or refinancing.

As a consequence of adverse changes in market conditions and other factors, nine
of the twelve loans made by the Partnership to date have been foreclosed. In the
event of foreclosure, the property securing the loan is to be made available for
public sale  approximately  four to six months after  initiation of  foreclosure
proceedings and is to be sold to the highest bidder. The sales proceeds then are

                                       2
<PAGE>
paid to the first mortgagee,  who would be the Partnership,  until the principal
amount of the loan, and earned but unpaid  interest,  and foreclosure  costs are
repaid.  Any remaining surplus is paid to the borrower.  If no one offers a cash
price  sufficient  to enable the  Partnership  to recover  its  investment,  the
Partnership, as first mortgagee, is entitled to acquire the property in exchange
for cancellation of the amounts owed by the borrower. In that event, the general
partners' strategy is to complete any  predevelopment  work not completed by the
borrower  and to  attempt to sell the  property  for a price that would at least
enable the  Partnership to recover its investment in the property.  To date, the
Partnership  has acquired each of the  properties on which it has  foreclosed on
the related loan.

The Partnership's  investment in a foreclosed property generally consists of all
amounts  owing by the  borrower  to the  Partnership  that were  secured  by the
Partnership's  mortgage  at the  time it  acquired  the  property,  the  amounts
expended to acquire and complete predevelopment of the property and, unless paid
out of the gross proceeds of sale,  any expenses  incurred to sell the property.
Any cash  proceeds  in  excess  of the  investment  will be  distributed  to the
Partners.

The Partnership will be terminated as soon as practicable  following liquidation
of the Partnership  assets and  distributions of cash to the partners.  However,
the Partnership will not be terminated until mortgage loans made by it have been
repaid  and all  properties  and  other  assets  owned by it have  been sold and
payment of the purchase  price for those  assets is received or  converted  into
cash.  At this time,  it is unlikely  that the  Partnership  will be  terminated
within the next twelve months.

DEVELOPMENT POTENTIAL OF UNDERLYING PROPERTIES

The Partnership made loans to borrowers seeking to acquire or refinance, develop
and then sell  undeveloped  properties  in the Inland  Empire  area of  Southern
California to developers and  contractors.  In most cases,  the repayment of the
Partnership's loans depended on the ability of the borrower to sell or refinance
the property after  predevelopment  work is completed.  Accordingly,  one of the
critical  factors  that  affect the  ability of the  Partnership  to achieve its
investment  objectives is the potential  value and  salability of the properties
which secure  repayment of the  Partnership's  loans or the properties which the
Partnership has acquired through foreclosure.

Each loan made by the Partnership was secured by a first mortgage.  In the event
of a  foreclosure  sale, if the property is sold for at least the amount owed to
the Partnership,  the entire sales proceeds must be paid to the Partnership,  as
first mortgagee, before any proceeds may be paid to anyone else. If there are no
other purchasers,  or the other purchase offers made at the foreclosure sale are
not  sufficient  to pay  off  the  amounts  owed to the  Partnership,  as  first
mortgagee,  the  Partnership is entitled to acquire the property in exchange for
cancellation of the amounts owed by the borrower.  Under applicable laws, on any
such  acquisition,  any other  mortgages,  liens or encumbrances on the property
will be automatically  terminated and the Partnership will own the property free
and clear and will have no payment  obligations  thereafter,  other than (i) the
costs of completing any predevelopment  work not completed by the borrower;  and
(ii)  property   taxes  that  are  assessed   against  the  property  after  the
Partnership's  acquisition of the property;  and (iii) in some instances special
assessment district taxes which are assessed against the property.

There may be circumstances in which,  despite default, the general partners will
choose not to initiate foreclosure proceedings  immediately.  For example, there

                                       3
<PAGE>
may be ongoing sales  negotiations or a refinancing may be in process that would
be  disrupted  by the  initiation  of  foreclosure  proceedings  or the  general
partners  may  conclude  that the  borrower-owner  is  better  able to  complete
predevelopment and to sell the property than the Partnership.  There also may be
instances in which the general partners choose not to purchase a property at the
foreclosure  sale, even though the  Partnership  might sustain a partial or even
total loss of the investment on the loan.  For example,  it may be preferable to
accept a cash purchase offer for the property which is less than the amount owed
on the loan, but which would enable the Partnership to recover  immediately,  in
cash, a substantial  portion of its investment in the loan.  There could also be
circumstances in which  environmental  problems on a property discovered after a
loan is made  would  make  it  prudent  for the  Partnership  not to  acquire  a
property.  However,  the general partners believe such a circumstance would be a
rare occurrence.

LOANS STATUS AND FORECLOSED PROPETIES

As of December 31, 1998, the Partnership had made twelve mortgage loans of which
four were paid and eight resulted in foreclosures.  The status of such loans and
related foreclosures and other relevant information are summarized below.

TMP  FLOWERFIELD,  LLC  (previously  referred  to  as  PR  Equities,  Ltd.)  The
Partnership  made two loans  ("Loan 1" and "Loan  2") to PR  Equities,  Ltd.,  a
California Limited  Partnership.  The loans were secured by first trust deeds on
residential property located in San Jacinto, California. Loan 1 was secured by a
first deed of trust on 304 residential lots consisting of 5 separate residential
tracts in Phase II of the Rancho San Jacinto  master-planned  community.  Loan 2
was secured by a first deed of trust on two  residential  tracts  containing 148
lots that also are part of Phase II of the  Rancho  San  Jacinto  master-planned
community.  All of the properties are located east of Hewitt Street and north of
Washington Avenue in San Jacinto. These properties have received approval of the
tentative tract maps. See Note 4 to the consolidated financial statements.

The Partnership  foreclosed on the property securing these loans during 1994 and
currently owns the property.  The Partnership owes approximately $4.8 million as
a result of the Mello-Roos bond  assessments  and unpaid  property taxes.  These
debts, plus the continuing property tax accrual makes the property unsaleable in
the current real estate market. In order to make the property saleable,  it will
be necessary to get the Mello-Roos bond  assessments and interest  reduced.  The
feasibility of accomplishing this reduction is currently being evaluated.  While
the general partners are pursuing these options, the City of San Jacinto has (by
the terms of the bonds) begun foreclosure proceedings.

FRAME LOAN

The  Partnership  made a third loan ("Loan 3") to Richard D. Frame  secured by a
first trust deed for property under predevelopment in Temecula,  California. The
loan matured on February 8, 1994 and was  extended to April 20,  1994,  at which
time the Partnership received payment in full. A portion of the proceeds of this
loan was used for funding Loans 11 and 12.

SUNSET CROSSING I LOAN

The  Partnership  made their  fourth  loan  ("Loan 4") to Sunset  Crossing  I, a
California Limited  Partnership.  Loan 4 was secured by a first trust deed on 44

                                       4
<PAGE>

acres of commercially zoned property at the southwest corner of the intersection
of Interstate 10 and Sunset Avenue in the city of Banning, California. In August
of 1994, Sunset Crossing I defaulted on this loan. The Partnership foreclosed on
the property in December of 1994.  The general  partners are currently  pursuing
developers for this site.

FOX-OLSON LOAN #1

The  Partnership's  fifth loan  ("Loan 5") was made to  Marilyn  Fox-Olson;  who
defaulted on the loan. The Partnership  foreclosed on this property in November,
1994.  Approximately  2.14 of the acres of this property are currently in escrow
for  $279,655.  It is  anticipated  that the  remainder of the property  will be
listed  for sale  during  1999.  The  current  zoning  for the  property  is C-1
(commercial).  It is located at the northeast corner of Newport Road and Bradley
Road in the  unincorporated  area of Riverside  County known as Sun City/Menifee
Valley.

TMP REMINGTON, LLC

The Partnership's  sixth loan ("Loan 6") was made to Environmental  Development,
Ltd., (ED) a California Limited Partnership. Loan 6 was secured by a first trust
deed to property under predevelopment in San Diego, California.  ED defaulted on
the loan in October  of 1994.  ED signed an  extension  agreement,  wherein  the
Partnership  agreed to extend the term of the loan to May 1,  1995.  On March 1,
1995, ED defaulted on the interest payment due at that date, and the Partnership
filed a Notice of Default. The Partnership  subsequently accepted a deed in lieu
of foreclosure on the property in August 1995 and currently owns the property.

This  property  is  approximately  52 acres of  residentially  zoned land at the
southeast  quadrant of State Route 905 and  Interstate  805 Freeways in the Otay
Mesa area of the city of San Diego.  The existing zoning is A1-10 (0-5 units per
acre). The 52 acres are a portion of the 78.3-acre Remington Hills Precise Plan,
designed for low to moderate priced  single-family  homes.  The Precise Plan and
tentative map has been  processed  and  approved.  Sewer and water is within 200
feet of the site, and natural gas and  electricity  are also  available.  The 52
acre  portion of Remington  Hills is designed so it can be  developed  first and
stand alone from the remaining  portion of the Remington  Hills Precise Plan. An
environmental  impact report was approved in 1995.  The property has an approved
tentative  tract map for 184 lots.  The general  partners have  determined  that
construction of homes will achieve the highest return to the  Partnership  based
in part on the results of a market feasibility study. The Partnership,  together
with TMP Homes,  LLC,  have formed a joint  venture  ("Remington")  to construct
homes  on the  site.  Phase I will  consist  of 52  homes  and  construction  is
anticipated to begin in 1999.

TMP HOMES FLOWERFIELD-SUN CITY, LLC

On June 17, 1993, the Partnership  funded its' seventh mortgage loan, ("Loan 7")
to Marilyn  Fox-Olson.  Marilyn  Fox-Olson  defaulted  on this loan also and the
Partnership  acquired  the  property  on March 29,  1995.  The  property  has an
approved  tract map with 45  residential  lots and a 1.84 acre  commercial  site
located in Sun City/MenifeeValley,  California.  The Partnership,  together with
TMP Homes,  LLC, have formed a joint venture ("Sun City") to construct  homes on
this site. TMP Homes, LLC is currently ready to begin  construction of Phase One
consisting  of 12  homes.  The 1.84  acres of this  property  is in  escrow  for
$100,000.

                                       5
<PAGE>

SINGLETARY LOAN

On October 12, 1993, the Partnership funded it eighth loan ("Loan 8") secured by
a first deed of trust on 96 acres of  industrial/commercial  land located in the
unincorporated  area of Riverside County known as Rubidoux.  The loan was due on
April 12, 1995.  The borrower  sought to extend the loan,  and did pay extension
fees and additional  interest for several months.  However,  the Partnership was
forced to file a Notice of Default when the borrower ceased making payments. The
Borrower  filed  for  personal  bankruptcy  in  order to  forestall  foreclosure
proceedings.  After a period of  negotiation,  the  borrower was able to procure
additional  financing and paid the loan and accrued interest in full on December
13, 1995. As a result,  the  Partnership  distributed  $2,200,000 to the limited
partners.

LAMONTE LOAN

On October 25, 1993, the Partnership funded its ninth loan ("Loan 9") secured by
a first deed of trust on 6.54 acres of  commercial  land located in Simi Valley,
California.  This loan had an interest rate of 12.5%. The LaMontes' deposited an
amount equal to twelve  months  interest  due on the loan in a  segregated  bank
account  representing the last twelve months interest on the loan. The first six
months  of  interest  were paid by  Ventura  Pacific  Capital  Group  (VPCG),  a
developer  who had an option  agreement  and  ground  lease  agreement  with the
LaMontes' on the property.

The  principal  amount of the loan matured on April 25,  1995.  At that time the
Partnership filed a Notice of Default, the LaMontes' transferred the property to
a wholly owned  corporation and had the corporation file a Chapter 11 bankruptcy
proceeding to delay the  foreclosure.  The  Partnership  succeeded in having the
bankruptcy  court remove the stay after a contestual law and motion  proceeding.
The  LaMontes'  then filed a state court action asking the court for a temporary
injunction based on alleged  irregularities  during the foreclosure process. The
Partnership  acquired the  property  through  foreclosure  in April,  1996.  The
property was sold in 1997 and a gain on the sale of  approximately  $500,000 was
recorded by the Partnership. See Item 3.

LANSING LOAN

On March 23, 1994, the Partnership funded it tenth loan ("Loan 10") secured by a
first deed of trust on 28.42  acres of  commercially  zoned land  located on the
Northwest  corner of Murrieta Hot Springs Road and Jefferson Avenue in Murietta,
California. The loan was repaid on September 5, 1995. The proceeds were added to
cash reserves of the Partnership.

ROCKFIELD LOAN

On June 1, 1994, the Partnership  funded its eleventh loan,  ("Loan 11") secured
by a first deed of trust on 42 residential lots in Rancho Cucamonga, California.

Loan 11 was in  participation  with TMP Mortgage  Income  Plus,  Ltd.  (MIP),  a
private syndication of which TMP Investments, Inc. and TMP Properties also serve
as general  partners.  The total loan of  $250,000  was funded  $100,000  by the
Partnership  and  $150,000 by MIP.  The  principal  amount of Loan 11 was due on
March 1, 1995.  The  Rockfields'  defaulted  and the property was  foreclosed on
January  15,  1996.  The  Partnership  sold its'  interest  in the  property  in

                                       6
<PAGE>
November,  1996 to MIP for the amount of its  participation in the loan, as well
as monies  which the  Partnership  had  advanced to pursue  development  of this
property.  MIP has entered  into a joint  venture  with TMP Homes,  LLC to build
homes on the 29 lots that secured this loan. The  Partnership  currently holds a
note  receivable for this  property.  See Note 7 to the  consolidated  financial
statements.

PEPPERTREE PARK, LLC

On June 28, 1994, the Partnership  funded its' twelfth loan, ("Loan 12") secured
by a first deed of trust on 193 single family residential lots and a third trust
deed on 73 single family residential lots and 15 acres  office/professional  use
land in Fallbrook, California.

The  principal  amount of Loan 12 was due on June 28,  1995.  However,  the loan
agreement  allowed for an extension of an additional 6 months.  The  Partnership
received  $1,500,000  during 1996 and retained a $500,000  (20%) interest in the
property as an investor from which the Partnership  will receive a participation
in profits from the  development  of single  family  homes.  The property has an
approved  general plan  amendment,  specific plan, and tentative map The lots in
Phases 1 and 2 were  sold in late  1997 and  1998 and the  Partnership  received
$50,000. The lots in Phase 3 are currently under development.

ITEM 2   PROPERTIES

The Partnership has acquired eight properties  through  foreclosure as disclosed
in Item 1.

ITEM 3    LEGAL PROCEEDINGS

Albert  and Helen  LaMonte  had  named the  Partnership  as a  defendant  in two
lawsuits,   borrowers  in  Loan  9,  referred  to  above,   and  by  Southpointe
Corporation,  a related  entity  utilized to take title to the property and file
bankruptcy  proceedings  under Chapter 11 of the Bankruptcy  Court.  One lawsuit
alleged  conspiracy  and fraud on behalf of the  Partnership.  The other lawsuit
attempted to set aside the foreclosure  that occurred in April 1996. These suits
were settled in 1997. See Note 10 of the Consolidated Financial Statements.

ITEM 4   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of Registrants security holders during 1998.

ITEM 5   MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

MARKET INFORMATION

As of December 31, 1998, there were approximately 982 record holders of Units of
Limited  Partnership  Interest  ("Units"  or "the  Units"),  representing  total
subscription  of  15,715  units  and  subscription  proceeds  in the  amount  of
$15,715,000.  As of  such  date,  all  of the  subscription  proceeds  had  been
committed  to the  mortgage  loan  investments  described  in Item 1 and working

                                       7
<PAGE>
capital reserves. There is no other class of security outstanding or authorized.
There has not been, and currently there does not exist,  any established  public
trading market for the Units.  Accordingly,  to the general partners' knowledge,
there was no trading activity during the fiscal year ended December 31, 1995. In
1996, 75 Units were traded at between $315 and $400 per Unit.

CASH DISTRIBUTIONS

Total  interest  received on mortgage  loans from inception to December 31, 1998
was  $3,569,666  and other  income from  deposits  and other  sources  have been
received in the amount of  $1,474,375.  Also during 1996,  Loan 12 was repaid in
the form of $1,500,000 in cash and a 20% interest in Peppertree Park, LLC valued
at  $500,000.  Total  distributions  to  investors  from  such  income  and loan
repayments were made in 1996 of $682,571.  In 1997, the Partnership received net
proceeds from the sale of an apartment  building for its investment in Steadfast
HSC, LLC and distributed $2,232,365 to investors. There were no distributions in
1998. Total distributions to investors since inception have been $8,013,662.

ITEM 6   SELECTED CONSOLIDATED FINANCIAL DATA

The following  table  summarizes  selected  consolidated  financial  data of the
Partnership for the years ended December 31, 1998,  1997,  1996,  1995, and 1994
and should be read in conjunction with the more detailed consolidated  financial
statements contained in Item 8, below.
<TABLE>
<CAPTION>
                        1998         1997        1996        1995       1994
--------------------------------------------------------------------------------
<S>               <C>          <C>         <C>          <C>         <C>
Interest Income   $    44,832  $    48,916 $   166,318  $   717,171 $  1,253,631
Gain on Sale of
  Land and
  Investments              --  $ 1,026,850          --           --           --
Other Income      $    53,600  $     4,970 $   150,611  $    15,262 $      4,528
Total Income      $    98,432  $ 1,080,736 $   316,929  $   732,433 $  1,258,159
Net Income (Loss) $ (397,618)  $   945,723 $  (103,399) $   583,233 $(2,664,558)
Net Income (Loss)
     per Unit     $      (25)  $        60 $        (7) $        37 $      (168)
Cash Distribution
     per Unit     $         0  $       141 $        43  $       160 $         77
Total Assets      $13,937,406  $12,563,395 $12,727,275  $12,278,021 $ 12,968,990
</TABLE>
--------------------------------------------------------------------------------
Per Unit calculations  based on 15,715 Units  outstanding at December 31, 1994 -
1998.

ITEM 7   MANAGEMENT'S DISCUSSION AND ANALYSES OF FINANCIAL CONDITION
                  AND RESULTS OF OPERATIONS

The  following   discussion   and  analysis   provides   information   that  the
Partnership's management believes is relevant to an assessment and understanding
of the Partnership's consolidated results of operations and financial condition.
This discussion  should be read in conjunction with the  consolidated  financial
statements and footnotes, which appear elsewhere in this report.

This Annual Report on Form 10-KSB contains forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of
the  Securities Act of 1933,  which are subject to the "safe harbor"  created by
that  section.  Words  such as  "expects,"  "anticipates,"  "intends,"  "plans,"
"believes,"  "seeks,"  "estimates" and similar expressions or variations of such

                                       8
<PAGE>
words are  intended  to  identify  forward-looking  statements,  but are not the
exclusive  means  of  identifying  forward-looking  statements  in this  report.
Additionally,  statements  concerning  future  matters  such  as  the  features,
benefits and advantages of the Partnership's property regarding matters that are
not historical are  forward-looking  statements.  Such statements are subject to
certain risks and uncertainties, including without limitation those discussed in
"Risk Factors" sections of this report. The Partnership's  actual future results
could differ materially from those projected in the forward-looking  statements.
The Partnership assumes no obligation to update the forward-looking  statements.
Readers are urged to review and consider carefully the various  disclosures made
by the Partnership in this report,  which attempts to advise interested  parties
of the risks and factors that may affect the Partnership's  business,  financial
condition and results of operations.

RESULTS OF OPERATIONS

The  following  discussion  should  be read in  conjunction  with  the  attached
consolidated  financial  statements  and notes thereto for the fiscal year ended
December 31, 1998 and 1997.

During the period from inception (November 15, 1991) through April 22, 1994, the
Partnership was engaged in the formation of the  Partnership,  the sale of Units
and the investment of the subscription proceeds in mortgage loan investments. At
April 22,  1994,  a total of 15,715  Units had been sold for gross  proceeds  of
$15,715,000 and the offering was closed.  Excess proceeds from the sale of Units
were invested in interest-bearing reserve accounts.

In 1992,  the  Partnership  made two loans  totaling  $3,500,000 to PR Equities,
Ltd., a California  Limited  Partnership.  The loans were secured by first trust
deeds on residential property located in San Jacinto,  California.  In 1994, the
Partnership  foreclosed on the properties  securing these loans and continues to
own  these  properties.   In  accordance  with  generally  accepted   accounting
principles,  assets acquired through foreclosure should be recorded at the lower
of cost or fair value less costs of  disposal  at the date of  foreclosure.  The
1994-1997 financial  statements  originally issued reported this property at the
amount of the  outstanding  mortgage  balances due on these loans at the time of
foreclosure,  which did not  represent  their fair value less costs of disposal.
Management  has  subsequently  determined  that a valuation  allowance for these
properties  should have been established for  approximately  $3.8 million at the
date of foreclosure in 1994. The valuation  allowance  should have been adjusted
each year  thereafter  such that the only  value  for  these  properties  is the
capitalized direct carrying costs that represent the total accumulated  property
taxes and Mello-Roos bond  assessments.  Therefore,  the consolidated  financial
statements  for 1994  through  1997 have been  restated to record the  valuation
allowance and to adjust these properties to their fair value for those years.

In addition, management has determined that the amount of property taxes payable
as recorded in June,  1994, and subsequent  periods  through  December 31, 1997,
were understated by a total of $383,000. Accordingly, the consolidated financial
statements  for those  periods  have been  restated for this  understatement  by
adjusting the carrying  value of the land and the property  taxes payable in the
appropriate fiscal years.

In accordance  with  generally  accepted  accounting  principles,  the financial
statements of  majority-owned  investments are required to be consolidated.  The
1995,  1996, and 1997 financial  statements  originally  issued did not properly

                                       9
<PAGE>
account for the  consolidation  of all significant  majority-owned  investments.
Therefore,  the financial  statements of these majority owned entities have been
consolidated  with the financial  statements of the  Partnership's and have been
restated for fiscal years 1995, 1996, and 1997 to reflect the  consolidation and
related minority interests of $461,000 for Remington and Sun City as of December
31, 1998.

In November,  1996, the Partnership entered into a non-interest bearing note for
$286,000. In accordance with generally accepted accounting principles,  the note
should have been discounted at the date of execution and interest  accreted over
the period of the note for $127,000.  The consolidated financial statements have
been restated for this discount and accretion of interest.

During 1997,  the  Partnership  received  proceeds  from the sale of the LaMonte
property totaling  $1,950,000 and $1,725,096 from proceeds from an investment in
Steadfast H.S.C, LLC. In addition,  approximately $49,000 of interest income was
earned in 1997 and $45,000 in 1998.  During 1998, the  Partnership  received and
recorded income of $50,000 on its 20% investment in Peppertree.

Total  expenses for the year ended  December 31,  1998,  compared  with the year
ended December 31, 1997, increased by approximately  $175,000 due to an increase
in accounting  and  financial  reporting  and general and  administrative  costs
associated  with  the  above  restatements  and  the  note  receivable  discount
discussed above.

The  Partnership's  management  believes  that  inflation has not had a material
effect on the Partnership's results of operations.

LIQUIDITY AND CAPITAL RESOURCES

As of December  31,  1998,  the  Partnership  had  consolidated  cash on hand of
$416,098.  All other  proceeds  from the sale of Units has been  invested in the
making of loans  (See Item 1),  working  capital  reserves,  or has been used in
foreclosure  proceedings  or  maintaining  the  foreclosed  properties  for  the
Partnership.

The Partnership raised a total of $8,334,000,  $6,127,000, and $1,254,000 during
the calendar years ended December 31, 1992,  1993, and 1994,  respectively for a
total of $15,715,000 in gross proceeds from the sale of units.  The offering was
closed on April 22, 1994,  and no additional  subscriptions  were accepted after
that date. The Partnership  made a total of twelve mortgage loans for a total of
$15,015,000.  Loans of $4,870,000,  $7,420,000,  and $2,725,000 were made during
the calendar years ended December 31, 1992, 1993, and 1994, respectively.

Three loans, in the total amount of $4,825,000 were repaid during the year ended
December 31, 1995. Nine loans totaling  $10,190,000  were  foreclosed.  Proceeds
from  loan  repayments  were  reinvested,  added  to  Partnership  reserves,  or
distributed to investors.

The  Partnership  does not intend to make any new land loans  with  existing  or
future  partnership  cash. At December 31, 1998, the Partnership had development
agreements with TMP Homes, LLC, an affiliated  company, to develop single family
homes  on  three  of  the  properties  the  Partnership  has  acquired   through
foreclosure.  In  addition,  the  Partnership  has a  $500,000  investment  in a
single-family   development   that  resulted  from  the  Peppertree   loan.  The
Partnership was repaid $1,500,000 of the $2,000,000 Peppertree loan in cash. The
remaining $500,000  represents a 20% investment in the project.  The Partnership

                                       10
<PAGE>
may incur  indebtedness from  nonaffiliated  financial  institutions in order to
complete any development for projects in which the Partnership is involved.

The  properties  relating  to the nine  loans that were  foreclosed  upon by the
Partnership  produce  no  income.  Accordingly,  the  Partnership  is not making
distributions to investors except from the sales proceeds of certain partnership
assets.  The Partnership cash reserves are being used to fund the operating cash
needs  of  the  Partnership.  As of  December  31,  1998,  the  Partnership  had
sufficient cash reserves for the next twelve months.

The foreclosed San Jacinto  properties have substantial  Mello-Roos  assessments
and property tax  delinquencies  that the Partnership  does not have the cash to
pay,  nor is it in the best  interests  of the  Partnership  to pay. The general
partners are  attempting to have the  Mello-Roos  bonds  restructured,  however,
there is no assurance that this will be accomplished.

In  March,  1998,  the  general  partners  of the  Partnership  entered  into an
agreement (the Financing Agreement) with PacWest Inland Empire, LLC (PacWest), a
Delaware Limited Liability Company,  whereby PacWest paid a total of $300,000 to
the general partners of the Partnership and ten other related  partnerships (the
TMP Land  Partnerships).  PacWest agreed to pay up to an additional $300,000 for
any deficit  capital  accounts  for these 11  partnerships  in exchange  for the
rights  to  distributions   from  the  general   partners;   referred  to  as  a
"distribution fee" as defined by the Financing Agreement.

In  addition,  PacWest  agreed  to loan  and/or  secure  a loan for the TMP Land
Partnerships in the amount of $2,500,000.  Loan proceeds are allocated among the
11 TMP Land Partnerships,  based on partnership needs, from recommendations made
by PacWest,  and under the approval  and/or  direction of the general  partners.
Portions of these funds were loaned to the  Partnership  at 12% simple  interest
over a 24-month  period  beginning  April 1, 1998. The borrowings are secured by
the  Partnership's  properties,  and the funds will be loaned, as needed, in the
opinion of the general  partners.  These funds are not to exceed 50% of the 1997
appraised  value  of the  properties,  and  will  primarily  be  used to pay for
on-going  property  maintenance,  reduction of existing debt,  property taxes in
arrears, appropriate entitlement costs and Partnership operations.

PacWest,  can, at their option,  make additional  advances with the agreement of
the general  partners.  However,  the aggregate amount of cash loaned to the TMP
Land Partnerships is limited to a maximum of $2,500,000. As of December 31, 1998
PacWest has loaned the Partnership $3,267 for ongoing operations.

In April 1998, PacWest entered into a management,  administrative and consulting
agreement  (the  Management   Agreement)  with  the  general   partners  of  the
Partnership to provide the Partnership with overall  management,  administrative
and consulting  services.  PacWest currently  contracts with third party service
providers  to  perform  certain  of  the  financial,  accounting,  and  investor
relations' services for the Partnership.

Pursuant to the Management Agreement, PacWest has acquired the general partners'
unsubordinated 1% interest in the Partnership and assumed responsibility for all
partnership  administration  while not  replacing  any of the general  partners.
PacWest is paid a fee of $24,588 annually for its administrative services.

                                       11
<PAGE>
Aside from the  foregoing,  the  Partnership  knows of no demands,  commitments,
events, or uncertainties,  which might affect its liquidity or capital resources
in any material manner.

RISK FACTORS

Many currently  installed  computer  systems and software  products are coded to
accept  only two digit  entries in the date code  field.  Beginning  in the year
2000,  these  date code  fields  will  need to  accept  four  digit  entries  to
distinguish  21st century dates. As a result,  computer  systems and/or software
used  by  organizations  may  need to be  upgraded  to  comply  with  the  "Y2K"
requirements.  There is significant  uncertainty in the software and information
services  industries  concerning  the  potential  effects  associated  with such
compliance.  While the Partnership believes that its systems are compatible with
Y2K  applications,  there can be no assurance that all Partnership  systems will
function  properly  in all  operating  environments  and on all  platforms.  The
failure  to  comply  with  Y2K  requirements  by  systems  not  designed  by the
Partnership  may  also  have a  material  adverse  effect  on the  Partnership's
business,  financial  condition and results of operations.  The  Partnership has
developed and implemented a plan to identify and address potential  difficulties
associated with Y2K issues and does not expect to expend any  significant  funds
as a result of these issues.

The Partnership  utilizes a number of computer  software  programs and operating
systems across its entire organization  including applications used in financial
business  systems and various  administrative  functions.  The  Partnership  has
established an action plan for addressing Year 2000 issues. As a general matter,
the  Partnership is vulnerable to failures by third parties to address their own
Year 2000  issues.  The  Partnership  relies  heavily  upon  third  parties  for
financial services.  There can be no assurance that the Partnership's  suppliers
and other third parties will adequately  address their Year 2000 issues, and any
such  issues  could  have a  material  adverse  affect  upon  the  Partnership's
financial condition and results of operation.

Partnership has not spent a material amount of financial  resources to remediate
Year 2000 problems and does not anticipate  that it will spend a material amount
of financial  resources to remediate Year 2000 problems in the future. The costs
of such  remediation will be paid out as part of the  Partnership's  general and
administrative expenses.







                                       12
<PAGE>


ITEM 8   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The following financial statements are filed as part of the Form 10K:

For the fiscal years ended December 31, 1998 and 1997:

Independent Auditors' Reports                                                3-4

Consolidated Balance Sheet as of December 31, 1998                            5

Consolidated Statements of Operations for the years ended December 31,1998
 and 1997              6

Consolidated Statements of Partners' Capital for the years Ended
 December 31, 1998 and 1997      7

Consolidated Statements of Cash Flow for the years ended
 December 31, 1998 and 1997                                                  8-9

Notes to Consolidated Financial Statements                                 10-16

Supplemental Schedules to Consolidated Financial Statements Schedules      17-19

All other schedules are omitted since the required information is not present or
is not present in amounts sufficient to require  submission of the schedule,  or
because the  information  required is  included  in the  Consolidated  Financial
Statements and Notes thereto.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

There were no disagreements  with the independent  accounting firm. On April 14,
1999, the Registrant filed a Form 8-K in which it terminated the accounting firm
of Balser,  Horowitz,  Frank & Wakeling and appointed the independent accounting
firm of Swenson Advisors, LLP.


                                    PART III

ITEM 10  DIRECTORS AND EXECUTIVE OFFICERS

The  Partnership  has no employees and no directors or executive  officers.  The
general partners provide  management of the  Partnership.  However,  on April 1,
1998, PacWest entered into the Management Agreement with the general partners of
the   Partnership   to  provide  the   Partnership   with  overall   management,
administrative and consulting  services.  PacWest currently contracts with third
party service  providers to perform  certain of the financial,  accounting,  and
investor relations' services for the Partnership.

TMP Properties, a California General Partnership,  and TMP Investments,  Inc., a
California  Corporation,  are  the  general  partners  of the  Partnership.  TMP
Properties was formed on July 14, 1978. TMP Properties'  principal  business has

                                       13
<PAGE>
been the  acquisition of  undeveloped  land and the  coordination  of activities
necessary  to add  value to such  land,  primarily  through  the  predevelopment
process.  It has syndicated  numerous private real estate limited  partnerships,
and  eight  public  real  estate  limited  partnerships.  All of the  properties
purchased by such  partnerships  were located in the State of California  except
for one (an office building) which was located in Oklahoma City, Oklahoma.  Each
of such limited partnerships involved a specified real property program in which
TMP Properties was the general partner. In addition, TMP Properties has been and
will  continue to be engaged in property  management,  assets  management,  real
estate accounting,  budgetary  services and partnership  management on behalf of
existing limited  partnership and limited  partnerships which it sponsors in the
future. The general partners of TMP Properties are William O. Passo, Anthony W.
Thompson and Scott E. McDaniel.

TMP  Investments,  Inc.,  a California  Corporation,  was formed on December 12,
1984.  TMP  Investments,  Inc.  acts  as  loan  servicer  for  the  Partnership,
maintaining records with respect to, and billing and collecting payments on, the
loans  made by the  Partnership.  As  compensation  for such  services,  TMP has
received  a  monthly   loan-servicing  fee  from  each  borrower,  and  not  the
Partnership,  in an amount up to 1/8th of 1% of the outstanding principal amount
of the borrower's  loan.  See  "Compensation  to the general  partners and their
Affiliates."  TMP  Investments  also performs  administrative,  bookkeeping  and
clerical services for the Partnership.  The principals of TMP Investments,  Inc.
are William O. Passo and Anthony W. Thompson.

The  individual  partners of TMP  Properties  are listed  below,  together  with
information regarding their employment experience and background.

WILLIAM O. PASSO, 57, is a director and the President of TMP  Investments,  Inc.
He practiced law for 18 years, has been a licensed real estate broker since 1974
and holds registered  representative and general principals  securities licenses
through the National Association of Securities Dealers,  Inc. Mr. Passo received
his Juris Doctorate Degree from UCLA School of Law in 1967. He has been a senior
partner first of Passo, Yates and Nissen until 1975, then of Passo & Davis until
March 1983 when he resigned from the  partnership  to take a leading role in the
management  of the affairs of TMP  Properties.  Mr.  Passo has been  involved in
public  and  private  real-estate  syndication  since  1970,  and has  acted  as
principal,  investor,  General Partner,  and counsel in real estate transactions
involving apartments, office buildings, agricultural groves and unimproved land.
Mr.  Passo is a  director  and  officer of William O.  Passo,  Inc.  d.b.a.  TMP
Management,  a property  management  company,  and an officer of TMP CC., a NASD
registered broker-dealer.

SCOTT E. MCDANIEL, 52, is a General Partner of TMP Properties.  He is a graduate
of the US Naval Academy at Annapolis, majoring in engineering. Mr. McDaniel is a
California  licensed general contractor and has been a licensed  California real
estate broker since 1976. He was the founder and president of Scott E. McDaniel,
Inc.  (dba Regal  Realty).  Mr.  McDaniel has  developed  office  complexes  and
industrial  space in Southern  California and has personally  brokered over $125
million of real  estate  since  1982.  Through an  affiliated  company,  DeVille
Construction Co., Inc., Mr. McDaniel has directed general contracting operations
in Southern California since 1982.

ANTHONY  W.  "TONY"  THOMPSON,  52,  is  Director  and  Vice  President  of  TMP
Investments,  Inc. A graduate  of  Sterling  College in 1969,  with a  Bachelors
Degree in Science and Economics, Mr. Thompson holds the professional designation

                                       14
<PAGE>
of Charter Life underwriter and chartered Financial Consultant from the American
College. Mr. Thompson is a registered principal with the NASD and is a principal
in TMP Capital Corp. (TMP CC); a NASD registered Broker Dealer. Mr. Thompson has
been  involved in the  securities  and the real estate  investment  fields since
1970, and a General  Partner of TMP since its formation in 1978. Mr.  Thompson's
primary  responsibility  is marketing  TMP offerings  through the  broker-dealer
community.

In addition to being a general partner of the Partnership,  TMP Properties,  and
some of its affiliates,  have been and continue to be a general partner of other
limited  partnerships.  If any such other  limited  partnerships'  assets should
become  insufficient  to meet  Partnership  obligations,  TMP  Properties,  as a
general  partner  of such  other  limited  partnerships,  might  be  subject  to
liabilities on behalf of such partnerships.

ITEM 11  EXECUTIVE COMPENSATION

During the period since the  formation of the  Partnership  (November  15, 1991)
through the fiscal year ended December 31, 1998, the Partnership paid no fees to
the general  partners.  The general  partners did receive  collectively  $22,323
during the fiscal year ended December 31, 1997 as their share of the Partnership
distributions.  (See Item 13. "Certain Relationships and Related Transactions".)
The  Partnership  has no officers or  employees  and,  therefore,  paid no other
compensation other than that paid to the general partners as indicated above.


ITEM 12  SECURITY OWNERSHIP OR CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

As of December 31, 1998 the Partnership has 15,715 Units issued and outstanding.
To the knowledge of the general partners,  no person beneficially owns more than
5% of the  Units.  The  following  table  sets  forth  the  number  of the Units
beneficially owned as of December 31, 1998 by each officer, director and general
partner of the general partners and by all such persons as a group.
<TABLE>
<CAPTION>

                                           Number of        Percent of
Name of Beneficial Owner                    Units             Class
<S>                                         <C>               <C>
William O. Passo                             1                .012%

All officers, directors and general
partners as a group (1 person
including the above)                         1                .012%
</TABLE>

ITEM 13  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

TRANSACTIONS WITH AFFILIATES

TMP CC is the Managing Broker-Dealer for the offer and sale of the Units. TMP CC
is a member firm of the National  Association  of Securities  Dealers,  Inc. The
Managing Broker-Dealer was established to provide underwriting, wholesaling, and

                                       15
<PAGE>
other  securities  related  services to  partnerships  sponsored  by the general
partners.  The  directors  and  executive  officers  of TMP CC  are  Anthony  W.
Thompson,   President   and   Director,   and  William  O.   Passo,   secretary,
vice-president,  and director.  (See Item 10 "Directors and Executive  Officers"
for information regarding Messrs. Thompson and Passo).


The following information summarizes the forms and amounts of compensation (some
of which involve cost  reimbursements)  paid by the  Partnership and other third
parties,  to the general partners and their affiliates.  None of these fees were
determined by arm's length negotiations.  Except as disclosed below, neither the
general partners nor any of their affiliates,  directors,  officers,  employees,
agents, or counselors are  participating,  directly or indirectly,  in any other
compensation or remuneration with respect to the offering.

















                                       16
<PAGE>
<TABLE>
<CAPTION>
OFFERING AND ORGANIZATIONAL STAGE

Amount paid from Formation thru 12/31/98
<S>                        <C>                           <C>

Form of Compensation
--------------------
and Recipient              Description of Payment        Amount of Compensation
-------------              ----------------------        ----------------------

Selling Commissions (TMP   Up to a maximum of 10% gross  Paid by TMP Realty,Inc.
CC and certain             proceeds, a minimumof 8%
Soliciting dealers)        which was reallocated to
                           participating soliciting
                           dealers(which included TMP
                           CC)from Units sold by  them.
                           Up to an additional 5% paid
                           to soliciting Dealers (which
                           included  TMP  CC) for due
                           diligence activities.

Reimbursement of           Organizational Expenses       Paid by TMP Realty,Inc.
Organizational  Expenses   reimbursed to the general
(general partners)         partners for  advertising,
                           mailing,  printing  costs,
                           clerical expenses, legal and
                           accounting fees.

Reimbursement of Loan      The general partners were     Paid by TMP Realty,Inc.
Expenses (general partners)reimbursed for all out of
                           pocket expenses directly
                           related to the loans, inclu-
                           ding credit evaluation ex-
                           penses, property evaluation
                           expenses, appraisal reports,
                           title reports, environmental
                           reports and remediations,
                           and feasibility studies,
                           escrow expenses, deposits
                           and interest, and other
                           similar expenses; but not
                           including the general
                           partners' overhead,
                           salaries, travel or like
                           expenses.

OPERATING AND LIQUIDATION STAGE

Form of Compensation       Description of Payment        Amount of Compensation
--------------------       ----------------------        ----------------------
And Recipient
-------------
Loan Servicing Fee         For servicing the loans made  $422,556
</TABLE>

                                       17
<PAGE>
<TABLE>
<CAPTION>
<S>                        <C>                          <C>

                           by the Partnership,TMP
                           Investments  received a
                           monthly LoanServicing  Fee
                           that was  charged  to and
                           paid by each borrower in an
                           amount up to 1/8 of 1% of
                           the outstanding  principal
                           amount of this mortgage
                           loan.


Broker Loan Placement      TMP Realty, Inc. received     $1,627,475
Fee (Licensed Real Estate  Broker Loan Placement Fees
Broker Affiliated          from borrowers, as was
with general partners)     negotiated by TMP Realty,
                           Inc. with suchborrowers, as
                           follows: TMP Realty, Inc.
                           retained 100% of the Broker
                           Loan Placement Fee received
                           on financing for aggregate
                           loans up to the Gross
                           Proceeds of the offering
                           (the  "Initial  Loans").
                           Thereafter, on any extension
                           of or new loans  that  were
                           made with  principal
                           repayments   from  Initial
                           Loans, TMP Realty, Inc.
                           retained 75% of any Broker
                           Loan  Placement  Fee, and
                           the  remaining 25% was
                           remitted to the Partnership
                           as loan  extension  or
                           origination fees ("Points"),
                           until TMP Realty, Inc. had
                           satisfied its obligations to
                           pay, out of the Broker Loan
                           Placement Fees retained by
                           it, all commissions and
                           other amounts payable by it
                           for  services  rendered by
                           securities  broker/dealers
                           in connection with the offer
                           and sale of  Units.  On
                           loans made thereafter,  TMP
                           Realty, Inc. retained 50% of
                           any Broker Loan  Placement
                           Fee, and the remaining 50%
                           were remitted to the
                           Partnership  as Points;
                           provided, however, that TMP
                           Realty,  Inc.'s rights to
                           retain its 50%  portion
                           was  subordinated to the
                           limited partners' Priority
                           Return.
</TABLE>


                                       18

<PAGE>
<TABLE>
<CAPTION>


<S>                        <C>                          <C>
Interest in Partnership    1% interest in all Partner-   $81,748
Allocation of each         ship allocations Net Income,
Material Item (General     Net Loss, and Distributions
Partners)                  of Cash from Operations.

Subordinated Participation A 24% interest in allocation  None Paid
(general partners)         of Net Income and Distribu-
                           tions of Cash from Loan
                           Repayments or from the Sale
                           or Refinancing   of  a
                           property   acquired through
                           foreclosure  or otherwise,
                           all subordinated to a return
                           of all the limited  partners
                           of 8%  per  annum  on their
                           Adjusted Capital Contri-
                           butions.

Subordinated Real Estate   Real Estate commissions with  None Paid
Commission (general        respect to the sale of any
partners or an affiliate)  properties acquired through
                           foreclosure or otherwise,
                           which are equal to the
                           lessor of: (1) 3% of the
                           gross  sales  price of a
                           property equal to  one-half
                           the normal and competitive
                           rate charged by unaffiliated
                           parties, but such payment
                           shall be subordinated  to a
                           return  of all of the
                           Limited partners' Capital
                           Contributions, plus  a
                           non-compounded return to the
                           limited partners of 8% per
                           annum  on their Adjusted
                           Capital Contributions.
</TABLE>


                                       19
<PAGE>


ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
                  FORM 8K

         (a) For a listing of consolidated  financial  statements,  reference is
             made to Item 8 included in this Form 10K-SB.

         (b) Exhibits:

         3 & 4    Amended and Restated Agreement of limited partnership
                  incorporated by reference to Exhibit 4.1 filed in Form S-11,
                  SEC File No. 33-39238 on April 13, 1992.

         10       Material contracts are incorporated by reference as follows:

                  Incorporated by reference to Amendment No. 1 as filed with the
                  SEC on September 14, 1992.

                  10.1.1 Loan Agreement - PR Equities Loan (Loan #1)

                  10.1.2 Promissory Note - PR Equities Loan (Loan #1)

                  10.1.3 Deed of Trust - PR Equities Loan (Loan #1)

                  10.2.1 Loan Commitment - PR Equities Loan (Loan #2)

                  10.3.1 Loan Agreement - Frame Loan (Loan #3)

                  10.3.2 Promissory Note - Frame Loan (Loan #3)

                  10.3.3 Deed of Trust - Frame Loan (Loan #3)

                  10.4.1 Loan Agreement - Sunset Crossing Loan (Loan #4)

                  10.4.2 Promissory Note - Sunset Crossing Loan (Loan #4)

                  10.4.3 Deed of Trust - Sunset Crossing Loan (Loan #4)

                  10.4.4 Personal Guaranty - Sunset Crossing Loan (Loan #4)

                  10.4.5 Promissory Note - Bank Loan for Bridge Financing -
                         Sunset Crossing Loan  (Loan #4)

                  Incorporated by reference to Amendment No. 3 as filed with the
                  SEC on February 24, 1993.

                  10.7.1 Loan Agreement - PR Equities Loan (Loan #2)

                                       20
<PAGE>

                  10.7.2 Promissory Note - PR Equities Loan (Loan #2)

                  10.7.3 Deed of Trust - PR Equities Loan (Loan #2)

                  10.10.1 Loan Agreement - Fox-Olson Loan (Loan #5)

                  10.10.2 Promissory Note - Fox-Olson Loan (Loan #5)

                  10.10.3 Deed of Trust - Fox-Olson Loan (Loan #5)

                  10.11.1 Loan Agreement - Environmental Development, Ltd.
                          (Loan #6)

                  10.11.2 Promissory Note - Environmental Development, Ltd.
                          (Loan #6)

                  10.11.3 Deed of Trust - Environmental Development Ltd.
                          (Loan #6)

                  Incorporated by reference to Amendment No. 6 as filed with the
                  SEC on September 14, 1993:

                  10.8.4 Modification of Promissory Note - Frame Loan (Loan #3)

                  10.12.1 Loan Agreement - Fox-Olson Loan 2 (Loan #7)

                  10.12.2 Promissory Note - Fox-Olson Loan 2 (Loan #7)

                  10.12.3 Deed of Trust - Fox-Olson Loan 2 (Loan #7)

                  Incorporated herein by reference to Exhibits A through H filed
                  with the  Registrant's  Current  Report  on Form  8-K, dated
                  October 12, 1993, SEC File No. 0-19933:

                  10.13.1 Loan Agreement - Singletary Loan (Loan #8)

                  10.13.2 Promissory Note - Singletary Loan (Loan #8)

                  10.13.3 Deed of Trust - Singletary Loan (Loan #8)

                  10.14.1 Loan Agreement - LaMonte Loan (Loan #9)

                  10.14.2 Promissory Note - LaMonte Loan (Loan #9)

                  10.14.3 Deed of Trust - LaMonte Loan (Loan #9)

                  10.14.4 Subordination, Non-disturbance and Attornment
                          Agreement - LaMonte Loan    (Loan #9)


                  10.14.5 Consent  to and  Subordination  of  Deed  of  Trust -
                          LaMonte Loan (Loan #9)

                                       21
<PAGE>


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.

Date: June 11, 1999

                      TMP Land Mortgage Fund, Ltd.
                      A California Limited Partnership

                      By: TMP Investments, Inc., a California Corporation as
                          Co-General Partner

                      By:       /S/ WILLIAM O PASSO
                         -----------------------------------------
                           William O. Passo, President & CEO

                      By:      /S/ ANTHONY W THOMPSON
                          -----------------------------------------
                           Anthony W. Thompson, Exec. VP



                      By: TMP Properties, a California General Partnership
                          as Co-General Partner

                      By:       /S/ WILLIAM O PASSO
                         -----------------------------------------
                            William O. Passo, General Partner

                      By:        /S/ ANTHONY W THOMPSON
                         -----------------------------------------
                            Anthony W. Thompson, General Part  ner

                       By:     /S/ SCOTT E MCDANIEL
                          -----------------------------------------
                             Scott E. McDaniel, General Partner


                      By: JAFCO, Inc., a California Corporation as Chief
                          Accounting Officer

                      By:    /S/ JOHN FONSECA
                         ------------------------------------------
                           John Fonseca, President


<PAGE>



                                Table of Contents
                                -----------------



Reports of Independent Auditors                                       3-4

Consolidated Balance Sheet                                              5

Consolidated Statements of Operations                                   6

Consolidated Statements of Partners' Capital                            7

Consolidated Statements of Cash Flows                                 8-9

Notes to Consolidated Financial Statements                          10-16

Supplementary Information                                           17-19








                                      -2-
<PAGE>




                         Report of Independent Auditors

To the Partners
TMP Land Mortgage Fund, Ltd.
(A California Limited Partnership)

We have audited the accompanying consolidated balance sheet of TMP Land Mortgage
Fund, Ltd. (A California  Limited  Partnership) as of December 31, 1998, and the
related consolidated statements of operations, partners' capital, and cash flows
for the year then ended.  These financial  statements are the  responsibility of
the  Partnership's  management.  Our  responsibility is to express an opinion on
these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards  require that we plan and perform the audit to obtain reasonable
assurance   about  whether  the  financial   statements  are  free  of  material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of TMP Land Mortgage Fund, Ltd. (A
California Limited  Partnership) as of December 31, 1998, and the results of its
operations  and its cash  flows  for the year  then  ended  in  conformity  with
generally accepted accounting principles.

Our audit was made for the purpose of forming an opinion on the basic  financial
statements taken as a whole. The supplementary information contained in Schedule
II is presented for purposes of  additional  analysis and is not a required part
of the basic financial  statements.  Such  information has been subjected to the
auditing procedures applied in the audit of the basic financial  statements and,
in our opinion,  is stated  fairly in all  material  respects in relation to the
basic financial statements taken as a whole.

Other  auditors  examined the  financial  statements as of December 31, 1997. As
discussed in Note 4, those auditors expressed an unqualified opinion on February
3, 1998,  and on May 15, 1999 reissued  their  unqualified  opinion for the year
ended December 31, 1997.


Swenson Advisors, LLP
SWENSON ADVISORS, LLP

Temecula, California
May 28, 1999

                                       -3-
<PAGE>




                          Independent Auditor's Report

To the Partners
TMP Land Mortgage Fund, Ltd.
(A California Limited Partnership)


We have  audited  the  accompanying  consolidated  balance  sheets  of TMP  Land
Mortgage Fund, Ltd. (A California  Limited  Partnership) as of December 31, 1997
and 1996,  and the related  consolidated  statements  of  operations,  partners'
capital,  and cash flows for the years ended December 31, 1997,  1996, and 1995.
These  financial   statements  are  the   responsibility  of  the  Partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards  require that we plan and perform the audit to obtain reasonable
assurance   about  whether  the  financial   statements  are  free  of  material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of TMP Land Mortgage Fund, Ltd. (A
California  Limited  Partnership)  as of  December  31,  1997 and 1996,  and the
results of its  operations  and its cash flows for the years ended  December 31,
1997,  1996  and  1995,  in  conformity  with  generally   accepted   accounting
principles.

Our audit was made for the purpose of forming an opinion on the basic  financial
statements taken as a whole. The supplementary information contained in Schedule
I and II is presented for purposes of additional  analysis and is not a required
part of the basic financial  statements.  Such information has been subjected to
the auditing  procedures applied in the audit of the basic financial  statements
and, in our opinion,  is stated  fairly in all material  respects in relation to
the basic financial statements taken as a whole.

Balser, Horowitz, Frank & Wakeling
BALSER, HOROWITZ, FRANK & WAKELING
An Accountancy Corporation

Santa Ana, California
February 3, 1998, except for note 7, for which the date is May 15, 1999

                                       -4-
<PAGE>
<TABLE>
<CAPTION>


                          TMP Land Mortgage Fund, LTD.
                       (A California Limited Partnership)
                           Consolidated Balance Sheet
                                December 31, 1998



                                     Assets
                                     ------

<S>                                                 <C>
Cash                                                $          416,098
Notes Receivable from Affiliate                                307,091
Prepaid Expenses                                                18,181
Other Receivables                                               32,553
Investments                                                    608,039
Investment in Unimproved Land, Net                          12,555,444
                                                     -----------------

   Total Assets                                     $       13,937,406
                                                     =================


                  Liabilities and Partners' Capital
                  ---------------------------------

Accounts Payable                                    $          162,624
Due to Affiliate                                                 3,267
Property Taxes Payable                                       4,870,485
Note Payable                                                   895,371
                                                     -----------------

   Total Liabilities                                         5,931,747

Minority Interests                                             460,171

Partners' Capital

  General Partners                                             (81,748)
  Limited Partners; 20,000 Equity Units Authorized,
    15,715 Outstanding                                       7,627,236
                                                     -----------------

Total Partners' Capital                                      7,545,488

Total Liabilities and Partners' Capital             $       13,937,406
                                                     =================
</TABLE>




           See Accompanying Notes of Consolidated Financial Statements
                                       -5-
<PAGE>
<TABLE>
<CAPTION>



                          TMP Land Mortgage Fund, LTD.
                       (A California Limited Partnership)
                      Consolidated Statements of Operations
                 For the Years Ended December 31, 1998 and 1997

                                                       1998              1997
                                                       ----              ----

Income
------
<S>                                              <C>                <C>

Interest                                         $     44,832       $    48,916
Gain on Sale of Land                                        -           505,740
Gain on Sale of Investment                                  -           521,110
Other                                                  53,600             4,970
                                                  -----------        ----------

         Total Income                                  98,432         1,080,736
                                                  -----------        ----------

Expenses

Accounting and Financial Reporting                     64,017            23,535
General and Administrative                             36,417             7,609
Note Receivable Discount                               73,268                 -
Interest Expense                                          227             1,082
Other                                                  39,311             5,526
                                                  -----------        ----------

         Total Expenses                               213,240            37,752
                                                  -----------        ----------

  Net Income (Loss) before Minority
       Interests and Income Taxes                    (114,808)        1,042,984
                                                  -----------       -----------

  Minority Interests in Consolidated Affiliates      (280,410)          (94,861)

  State Franchise Tax                                   2,400             2,400
                                                  -----------        ----------


  Net Income (Loss)                              $  (397,618)       $   945,723
                                                  ===========        ==========

Allocation of Net Income (Loss)

  General Partners, in the Aggregate             $    (3,976)       $     9,457
                                                  ===========        ==========

  Limited Partners, in the Aggregate             $  (393,642)       $   936,266
                                                  ===========        ==========

  Limited Partners, per Equity Unit              $       (25)       $        60
                                                  ===========        ==========
</TABLE>

          See Accompanying Notes of Consolidated Financial Statements
                                       -6-
<PAGE>
<TABLE>
<CAPTION>


                          TMP Land Mortgage Fund, LTD.
                       (A California Limited Partnership)
                  Consolidated Statements of Partners' Capital
                 For the Years Ended December 31, 1998 and 1997




                                             General     Limited
                                             Partners    Partners       Total
<S>                                         <C>        <C>          <C>

Partners' Capital (deficit),
     January 1, 1997                        $(64,906)  $ 9,294,654  $ 9,229,748

Net Income for 1997                            9,457       936,266      945,723

Distribution to Partners in 1997             (22,323)   (2,210,042)  (2,232,365)
                                             -------    ----------   ----------

Partners' Capital (deficit),
     December 31, 1997                       (77,772)    8,020,878    7,943,106

Net Loss for 1998                             (3,976)     (393,642)    (397,618)
                                             --------   ----------   ----------

Partners' Capital (deficit),
     December 31, 1998                      $(81,748)  $ 7,627,236  $ 7,545,488
                                             =======    ==========   ==========
</TABLE>


Distributions  to limited  partners,  per equity  unit,  for 1997 were $141,  as
determined  by dividing  the  distribution  to limited  partners for the year by
number of units  outstanding at the end of the year. There were no distributions
in 1998.


          See Accompanying Notes of Consolidated Financial Statements
                                       -7-
<PAGE>

<TABLE>
<CAPTION>

                          TMP Land Mortgage Fund, LTD.
                       (A California Limited Partnership)
                            Statements of Cash Flows
                   For Years Ended December 31, 1998 and 1997

                                                        1998             1997
                                                        ----             ----
<S>                                                  <C>            <C>

Cash Flow from Operating Activities
  Net Income (Loss)                                  $  (397,618)   $   945,723
  Adjustments to Reconcile Net Income (Loss) to
    Net Cash Used in Operating Activities:
      Minority Interests in Consolidated Affiliates      280,410         94,861
      Note Receivable Discount                            73,268            ---
      Accretion of Discounted Note Receivable            (32,755)       (20,552)
      Gain on Sale of Investment                            ---        (521,110)
      Gain on Sale of Land                                  ---        (505,740)
      Other                                               39,311          5,526
      Changes in Assets and Liabilities:
        (Increase) Decrease in Other Receivables         101,676       (106,830)
        Increase in Notes Receivable from Affiliate     (170,626)           ---
        Increase in Accounts Payable                      87,230         69,840
        Increase in Prepaid Expenses                     (18,181)           ---
        Increase (Decrease) in Due to Affiliates         (29,294)         5,409
                                                     -----------   ------------
         Net Cash Used in Operating Activities           (66,579)       (32,873)
                                                     -----------    -----------

Cash Flows From Investing Activities:
      Proceeds from Sale of Investment                       ---      1,725,096
      Proceeds from Sale of Land                             ---      1,950,000
      Decrease (Increase) in Investments
          and Consolidated Affiliates                    381,726       (203,058)
      Increase in Land Development and
          Carrying Costs                              (1,754,899)      (607,838)
                                                     -----------    -----------
         Net Cash Provided by (Used In) Investing
         Activities                                   (1,373,173)     2,864,202
                                                     -----------   ------------

Cash Flows From Financing Activities:
  Proceeds from Note Payable                             895,371            ---
  Distributions to Partners                                  ---     (2,232,365)
                                                     -----------    ------------
         Net Cash Provided by
             (Used in) Financing Activities              895,371     (2,232,365)
                                                     -----------    ------------

Net Increase (Decrease) in Cash                         (544,381)        598,964
Cash, Beginning                                          960,479         361,515
                                                     -----------    ------------
Cash, Ending                                         $   416,098   $     960,479
                                                     ===========    ============
</TABLE>

          See Accompanying Notes of Consolidated Financial Statements
                                       -8-

<PAGE>

<TABLE>
<CAPTION>


                          TMP Land Mortgage Fund, LTD.
                       (A California Limited Partnership)
                Consolidated Statements of Cash Flows - Continued
                   For Years Ended December 31, 1998 and 1997

<S>                                                  <C>        <C>
Supplemental Disclosure of  Cash Flow Information:

Cash Paid for Income Taxes                           $  2,400   $  2,400
                                                     ========   ========

Cash paid for Interest                               $ 12,813   $    ---
                                                     ========    =======
</TABLE>

Non-cash investing and financing  activities during the years ended December 31,
1998 and 1997 consist of the following:

     During the years ended December 31, 1998 and 1997, the Partnership recorded
     an increase in the carrying  costs of  foreclosed  land equal to additional
     property tax liabilities incurred of $664,417 and $954,152, respectively.



          See Accompanying Notes of Consolidated Financial Statements
                                      -9-
<PAGE>


                                    TMP Land
                               Mortgage Fund, LTD.
                       (A California Limited Partnership)
                   Notes to Consolidated Financial Statements
                           December 31, 1998 and 1997

Note 1 -  General and Summary of Significant Accounting Policies

General - TMP Land Mortgage Fund,  Ltd., A California  Limited  Partnership (the
-------
"Partnership"),  was organized in 1991 in accordance  with the provisions of the
California Uniform Limited Partnership Act. The purpose of the Partnership is to
make  short-term  (generally one to three-year)  loans to  unaffiliated  parties
secured by first trust deeds  (mortgages) on unimproved real property  primarily
in  the  Inland  Empire  area  of  Southern   California  and  to  provide  cash
distributions  on a  current  basis  to the  limited  partners,  primarily  from
interest earned on the mortgage loans.

Principles of Consolidation - The consolidated  financial statements include the
---------------------------
accounts  of the  Partnership  and its  majority-owned  investments,  TMP  Homes
Remington,  LLC (Remington) and TMP Homes  Flowerfield-Sun City, LLC (Sun City).
All significant  intercompany  accounts and transactions have been eliminated in
consolidation. (See Note 4.)

Investment in Unimproved  Land - Investment in unimproved  land is stated at the
------------------------------
balance of the  foreclosed  loan plus carrying and  improvement  costs  incurred
subsequent to foreclosure,  net of a valuation allowance, as necessary, to state
the properties at their fair value.  All costs  associated  with the acquisition
and  improvement  of a property are  capitalized  including all direct  carrying
costs; such as interest expense and property taxes.

Syndication Costs - Syndication costs (such as commissions,  printing, and legal
-----------------
fees) were paid by an affiliate of the Partnership,  TMP Realty, Inc. (See Notes
2 and 6.)

Income  Taxes - No  provision  for  federal  income  taxes  has been made in the
-------------
accompanying  consolidated  financial  statements as all profits and losses flow
through to the respective partners and are recognized on their individual income
tax  returns.  However,  the  minimum  California  franchise  tax  paid  by  the
Partnership  and it's  consolidated  entities at December  31, 1998 and 1997 was
$2,400 per year.

Cash and Cash Equivalents - For purposes of the Consolidated  Statements of Cash
-------------------------
Flows, the Partnership  considers all highly liquid  investments with a maturity
of three months or less to be cash equivalents.  During the normal course of its
business,  the Partnership  accumulates  cash and maintains  deposits at various
banks.  Occasionally,  the cash  deposit  at a  particular  bank may  exceed the
federally insured limit. Any accounting loss or cash requirement  resulting from
the failure of a bank would be limited to such excess amounts.

Use of Estimates - In the preparation of financial statements in conformity with
----------------
generally  accepted  accounting  principles,  management  is  required  to  make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and the disclosure of contingent  assets and  liabilities as of the
date of the financial  statements and revenues and expenses during the reporting
period. Actual results could differ from these estimates.


                                      -10-
<PAGE>



                            Land Mortgage Fund, LTD.
                       (A California Limited Partnership)
                   Notes to Consolidated Financial Statements
                           December 31, 1998 and 1997

Note 1 -  General and Summary of Significant Accounting Policies, continued:

Concentration  - All  unimproved  land  parcels held for sale are located in the
-------------
Inland  Empire  area of Southern  California.  The  eventual  sales price of all
parcels  is  highly  dependent  on  the  real  estate  market  conditions.   The
Partnership  attempts to mitigate any potential  risk by  monitoring  the market
condition and holding the land parcels until the real estate market recovers.

New Accounting Standards - In June 1998 the Financial Accounting Standards Board
------------------------
issued  Statement of Financial  Accounting  Standards No. 133,  "Accounting  for
Derivative  Instruments and hedging Activities".  The new statement requires all
derivatives  to be recorded on the balance  sheet at fair value and  establishes
new accounting rules for hedging instruments. This statement will have no effect
on the consolidated financial statements of the Partnership.

Note 2 - Organization of the Partnership

TMP Properties (A California General  Partnership) and TMP Investments,  Inc. (A
California  Corporation)  originally formed the Partnership on November 15, 1991
as the general  partners.  The partners of TMP  Properties are William O. Passo,
Anthony W.  Thompson  and Scott E.  McDaniel.  William  O. Passo and  Anthony W.
Thompson were the shareholders of TMP  Investments,  Inc. until October 1, 1995,
when they sold their shares to TMP Group,  Inc. and then became the shareholders
of TMP Group, Inc.

The  general  partners  manage  and  control  the  affairs  of the  Partnership,
including  final  approval  of all  loans  and  investments,  and have  ultimate
authority  for  matters   affecting  the  interests  of  the  Partnership.   All
organization  and offering  expenses of the Partnership were paid by TMP Realty,
an affiliate of the general  partners,  in exchange for loan fees (or points) on
each mortgage loan.

The  partnership  agreement  provides for two types of  investments:  Individual
Retirement  Accounts (IRA) and others. The IRA minimum purchase  requirement was
$2,000 and all others were a minimum purchase requirement of $5,000. The maximum
liability of the limited partners is the amount of their capital contribution.

Note 3 - Partners' Contributions

The Partnership  raised capital through a public offering of units at $1,000 per
unit.  The  minimum  offering  size was 1,000 units or  $1,000,000.  The maximum
offering  size was 20,000 units or  $20,000,000.  As of April 21,  1994,  15,715
units were sold for total capital  contributions of $15,715,000 and the offering
was closed.


                                      -11-

<PAGE>



                            Land Mortgage Fund, LTD.
                       (A California Limited Partnership)
                   Notes to Consolidated Financial Statements
                           December 31, 1998 and 1997

Note 4 - Restatements and reissuances of 1994 - 1997 Financial Statements

In 1992,  the  Partnership  made two loans  totaling  $3,500,000 to PR Equities,
Ltd., a California  Limited  Partnership.  The loans were secured by first trust
deeds on residential property located in San Jacinto,  California.  In 1994, the
Partnership  foreclosed on the properties  securing these loans and continues to
own  these  properties.   In  accordance  with  generally  accepted   accounting
principles,  assets acquired through foreclosure should be recorded at the lower
of cost or fair value less costs of  disposal  at the date of  foreclosure.  The
1994-1997 financial  statements  originally issued reported this property at the
amount of the  outstanding  mortgage  balances due on these loans at the time of
foreclosure,  which did not  represent  their fair value less costs of disposal.
Management  has  subsequently  determined  that a valuation  allowance for these
properties  should have been established for  approximately  $3.8 million at the
date of foreclosure in 1994. The valuation  allowance  should have been adjusted
each year  thereafter  such that the only  value  for  these  properties  is the
capitalized direct carrying costs that represent the total accumulated  property
taxes and Mello-Roos bond  assessments.  Therefore,  the consolidated  financial
statements  for 1994  through  1997 have been  restated to record the  valuation
allowance and to adjust these properties to their fair value for those years.

In addition, management has determined that the amount of property taxes payable
as recorded in June,  1994, and subsequent  periods  through  December 31, 1997,
were understated by a total of $368,000. Accordingly, the consolidated financial
statements  for those  periods  have been  restated for this  understatement  by
adjusting the carrying  value of the land and the property  taxes payable in the
appropriate fiscal years.

In accordance  with  generally  accepted  accounting  principles,  the financial
statements of  majority-owned  investments are required to be consolidated.  The
1995,  1996, and 1997 financial  statements  originally  issued did not properly
account for the  consolidation  of all significant  majority-owned  investments.
Therefore,  the financial  statements of these material  majority owned entities
have been  consolidated  with the financial  statements of the Partnership's and
have been  restated  for  fiscal  years  1995,  1996,  and 1997 to  reflect  the
consolidation  and related minority  interests of $461,000 for Remington and Sun
City as of December 31, 1998.

In November,  1996, the Partnership entered into a non-interest bearing note for
$286,000. In accordance with generally accepted accounting principles,  the note
should have been discounted at the date of execution and interest  accreted over
the period of the note for $127,000.  The consolidated financial statements have
been restated for this discount and accretion of interest.

Note 5 - Allocation of Profits and Losses and Cash Distributions

Profit,  losses, and cash distributions are allocated ninety-nine percent to the
limited  partners  and one  percent to the  general  partners  until the limited
partners  have received an amount equal to their  capital  contributions  plus a
cumulative,  non-compounded  return of eight  percent  per annum  based on their
adjusted capital account balances, at which time, remaining profits,  losses and


                                      -12-
<PAGE>

                            Land Mortgage Fund, LTD.
                       (A California Limited Partnership)
                   Notes to Consolidated Financial Statements
                           December 31, 1998 and 1997

Note 5 - Allocation of Profits and Losses and Cash Distributions, continued:

cash distributions are allocated seventy-six percent to the limited partners and
twenty-four  percent  to  the  general  partners.  Distributions  of  cash  from
operations,  if any, are made monthly within 30 days after the end of the month.
No distributions were made during 1998. Distributions made during 1997 are shown
on the accompanying consolidated statements of partners' capital.

Note 6 - Related Party Transactions

Units were offered to the public through TMP Capital Corp. ("TMP  Capital"),  an
affiliate  of the  general  partners,  as  the  managing  broker-dealer.  As the
managing broker-dealer,  TMP Capital received a sales commission of up to 10% of
the gross proceeds,  8% of which was reallocated to soliciting  dealers on units
sold by them. TMP Realty, Inc paid these sales commissions.

Under the terms of the Partnership  agreement,  if the general partners or their
affiliates  provide a substantial amount of services in connection with the sale
of a property,  or a portion of it, acquired  through  foreclosure or otherwise,
they are paid a commission not to exceed the lesser of 1) one-half of the normal
and competitive  percentage of gross sales price charged for similar services by
an unaffiliated partner; or 2) 3% of the gross sales price of the property.  The
payment shall be subordinate to a return of all of the limited partners' capital
contributions and the payment to the limited partners of their cumulative unpaid
priority returns.  During 1997, the Partnership paid $42,693 to TMP Investments,
Inc,  for loan  servicing  fees on the La Monte  loan and paid  $216,250  to TMP
Realty,  Inc. for brokers  fees for the sale of the  Steadfast  investment.  The
Partnership was charged $15,152 by TMP Investments, Inc. for certain general and
administrative (office and secretarial) expenses during 1997. See also Note 14.

Note 7 - Notes Receivable from Affiliate

In  November,  1996,  the  Partnership  sold a  parcel  of land  (including  the
capitalized  interest  costs  and the  related  property  taxes  payable)  to an
affiliated  partnership,  TMP Mortgage  Income Plus,  LTD (MIP) for $286,000 and
recorded a note  receivable for a five year period  without  interest with a 12%
discount (imputed interest). The total sales price represented the Partnerships'
original  interest  of  $100,000,  as well as  $186,000  of other  advances  and
capitalized costs for the development of the land. The Partnership  recognized a
$127,000  discount  on the note as a charge  to  operations  for the  difference
between the total value of the land and the face value of the note. In 1998, the
Partnership  loaned an  additional  $165,000 to this  affiliate  for a five year
period  without  interest  (and  discounted  the note at 12%) and  recognized  a
$73,000 charge to operations due to the non-interest  bearing terms of the note.
As of December 31, 1998, the two notes receivable balances totaled $307,091 (net
of the  unamortized  discount of $143,648).  The Partnership  accreted  interest
income on these notes during 1998 and 1997 of $32,755 and $20,552,  respectively
which  is  included  as  interest  income  on  the  Consolidated  Statements  of
Operations. (See Note 4.)


                                      -13-
<PAGE>



                            Land Mortgage Fund, LTD.
                       (A California Limited Partnership)
                   Notes to Consolidated Financial Statements
                           December 31, 1998 and 1997

Note 8 - Agreements with PacWest

In March 1998, the general partners of the Partnership entered into an agreement
(the Financing Agreement) with PacWest Inland Empire, LLC (PacWest),  a Delaware
Limited Liability  company,  whereby  PacWest paid  the general  partners of the
Partnership and ten other related partnerships a total of $300,000 and agreed to
pay up to an additional  $300,000 for any deficit capital  accounts for these 11
partnerships  in  exchange  for the  rights to  distributions  from the  general
partners;  referred  to as a  "distribution  fee" as  defined  by the  Financing
Agreement.

In addition, PacWest agreed to loan and/or secure a loan for the Partnership and
ten other  related  partnerships  (the TMP Land  Partnerships)  in the amount of
$2,500,000.  Loan proceeds will be allocated among the 11 TMP Land Partnerships,
based on partnership needs, from  recommendations made by PacWest, and under the
approval and/or direction of the general partners. A portion of these funds will
be loaned to the  Partnership  at 12% simple  interest  over a  24-month  period
beginning  April 1,  1998.  The  borrowings  are  secured  by the  Partnership's
properties,  and funds will be loaned,  as needed, in the opinion of the general
partners.  These funds are not to exceed 50% of the 1997 appraised  value of the
properties, and will primarily be used to pay for on-going property maintenance,
pay down existing  debt,  accrued  property  taxes and  appropriate  entitlement
costs.

PacWest, at their option, can make additional advances with the agreement of the
general partners;  however,  the aggregate amount of cash loaned to the TMP Land
Partnerships is limited to a maximum of $2,500,000.

In April 1998, PacWest entered into a management,  administrative and consulting
agreement  (the  Management   Agreement)  with  the  general   partners  of  the
Partnership to provide the Partnership with overall  management,  administrative
and consulting  services.  PacWest currently  contracts with third party service
providers  to  perform  certain  of  the  financial,  accounting,  and  investor
relations' services for the Partnership.

Pursuant to the Management Agreement, PacWest has acquired the general partners'
unsubordinated 1% interest in the Partnership and assumed responsibility for all
partnership  administration  while not  replacing  any of the general  partners.
PacWest will charge a fee for its administrative services equal to an amount not
to exceed the average  reimbursements  to the general partners for such services
over the past five years. As of December 31, 1998, the Partnership has a payable
of $3,267 to PacWest related to the aforementioned agreements.


                                      -14-
<PAGE>
<TABLE>
<CAPTION>


                            Land Mortgage Fund, LTD.
                       (A California Limited Partnership)
                   Notes to Consolidated Financial Statements
                           December 31, 1998 and 1997

Note 9 - Investments

The following is a summary of the  investments of the Partnership as of December
31:

                                                              1998
<S>                                                       <C>

      TMP Flowerfield, LLC (Flowerfield)                  $    108,039
      Peppertree Park, LLC (Peppertree)                        500,000
                                                           -----------

                                                          $    608,039
</TABLE>

The  Partnership  has  a 75%  membership  interest  in  Flowerfield,  which  was
organized for the purpose of acquiring, owning and developing certain parcels of
land into single family home developments in San Jacinto, California. The equity
method is used to account for the Partnership's share of Flowerfield's  earnings
or losses  which is not  materially  different  than the  consolidation  of this
majority owned investment.

The  Partnership  has a 20% interest in Peppertree,  which was formed to acquire
and develop certain property in San Diego,  California.  The  Partnership's  20%
interest  is stated at its cost of  $500,000.  During  1998,  Peppertree  sold a
parcel of land for a total sales price of $5,455,000.  The Partnership  recorded
$50,000  for their  portion  of the gain on the sale of this  property  which is
included in other income on the consolidated statements of operations.

Note 10 - Gain on Sale of La Monte Property

During 1997, property acquired through foreclosure of the La Monte loan was sold
for $1,950,000 less costs of the property and related carrying and closing costs
for a net gain of $505,740.

Note 11 - Gain on Sale of Investments

During 1995 the Partnership invested approximately $855,000 in Steadfast H.S.C.,
LLC (Steadfast)  which was formed to acquire and operate an apartment  building.
In 1997,  this  investment was sold for a $521,110 gain to the  Partnership;  of
which  all but  $13,661  was  distributed.  This  amount  is  included  in other
receivables at December 31, 1998.

Note 12 - Property Taxes Payable

As of December  31,  1998,  approximately  $4,870,000  of total  property  taxes
payable is owed on the San Jacinto property (Note 4) representing the cumulative
unpaid property taxes and Mello-Roos tax assessments at that date.


                                      -15-
<PAGE>


                            Land Mortgage Fund, LTD.
                       (A California Limited Partnership)
                   Notes to Consolidated Financial Statements
                           December 31, 1998 and 1997

Note 13 - Note Payable

On March 10,  1998,  Sun City entered into a  promissory  note  agreement  for a
construction loan with a bank. The maximum loan amount is $2,275,000 and accrues
interest  at 1.5% per annum in excess of the prime  rate.  Interest  is  payable
monthly.  As of December 31, 1998,  Sun City has a principal  balance due on the
note of $895,371.

Note 14 - Minority Interests

In 1995, the Partnership  entered into a joint venture agreement  referred to as
"TMP  Remington,  LLC" with TMP Homes,  LLC (TMP Homes) whereby the  Partnership
contributed land for a 75% interest in TMP Remington, LLC.

TMP Homes contributed $100 for its 25% interest. As a result of this transaction
and subsequent  capital  contributions  whereby the  Partnership has contributed
assets for a 75% interest,  the  Partnership  has recognized a loss equal to the
fair value of 25% of the assets contributed to the joint venture which value was
credited to TMP Homes,  as the  minority  interest  owner,  who will develop the
property.

In April, 1996, the Partnership  entered into a joint venture agreement referred
to as "TMP Flowerfield - Sun City, LLC" with TMP Homes whereby  subsequently the
Partnership  contributed  land  which  had a  book  value  of  $511,000  and  an
agreed-upon  value of $420,000 for 75% interest in the venture.  The Partnership
recognized  a $91,000  loss on the write  down of the land and a loss for 25% of
the other contributed  assets which value was credited to TMP Homes the minority
interest  member,  who will develop the property.  The Partnership  accounts for
these two joint  ventures  on a  consolidated  basis and has  recorded  minority
interest gain/loss accordingly.

Note 15 - Year 2000 Compliance (unaudited)

Like other organizations and individuals around the world, the Partnership could
be  adversely  affected  if the  computer  systems it uses and those used by the
Partnership's  major customers and vendors do not properly process and calculate
date-related  information  and data  from and after  January  1,  2000.  This is
commonly  known as the "Year 2000 Issue."  Management  is assessing its computer
systems and the systems compliance issues of its major service providers.  Based
on information  available to management,  the Partnership's  major customers and
vendors are taking  steps that they believe are  reasonably  designed to address
the Year 2000 Issue with  respect to  computer  systems  that they use.  At this
time,  however,  there can be no assurance  that these steps will be sufficient,
and the failure of a timely completion of all necessary  procedures could have a
material  adverse  effect  on  the  Partnership's  operations.  Management  will
continue to monitor the status of, and its exposure to, this issue.

                                      -16-
<PAGE>




















                            SUPPLEMENTARY INFORMATION












                                      -17-
<PAGE>

<TABLE>
<CAPTION>


                                                         TMP LAND MORTGAGE FUND, LTD
                                                 (A California Limited Partnership)
                                       Schedule II - Real Estate and Accumulated Depreciation
                                        (Schedule XI, Rule 12-28, for SEC Reporting Purposes
                                                For the Year Ended December 31, 1998

COLUMN    A                  B           C                  D            E               F             G           H           I
-----------------------------------------------------------------------------------------------------------------------------------
                                                   COSTS CAPITALIZED
                                                      SUBSEQUENT       Gross
                                                    TO ACQUISITION   amount at                                             Estimated
                                   Initial                  Carrying which Carried   Accumulated     Date of       Date  Depreciable
Description of Assets Encumbrances  Cost      Improvement     Cost   at Year-End   Depreciation  Construction   Acquired     Life
------------------------------------------------------------------------------------------------------------------------------------
<S>                   <C>          <C>        <C>        <C>         <C>              <C>          <C>        <C>             <C>

Unimproved land -
San Jacinto           $4,870,485   $3,550,000 $   63,737 $5,279,858  $ 8,893,595      -0-           N/A       06/02/94&
                                                                                                               08/11/94        N/A
Unimproved land -
Sun City                  -0-       1,320,000        638     30,686    1,351,324      -0-           N/A        11/02/94        N/A
Unimproved land -
Banning                   -0-       1,875,000      1,500     23,447    1,899,947      -0-           N/A        12/21/94        N/A
Unimproved land -
Sun City                  -0-         420,000  1,268,188        -0-    1,688,188      -0-           N/A        03/29/95        N/A
Unimproved land -
San Diego                 -0-       1,658,000  1,062,680     24,819    2,745,499      -0-           N/A        08/23/95        N/A
                      $4,870,485   $8,823,000 $2,396,743 $5,358,810  $16,578,553      -0-
                      ==========    =========  =========  =========== ==========      ===

Less valuation allowance:                                            $ 4,023,109
                                                                      ----------
Net carrying value                                                   $12,555,444
                                                                      ==========

Reconciliation of carrying amount

Beginning balance                  $10,687,386

Additions
  Initial Costs                    420,000
Carrying Costs/Improv. $2,272,263
                       ----------
  Total Additions                  2,692,263
Deductions:
 Initial Costs            500,000
 Improvements               4,780
 Carrying costs           280,114
 Increase in valua-
       tion allowance      39,311
  Total Deductions                   824,205
                                     -------

Ending balance                     $12,555,444
                                    ==========
</TABLE>
                                                              -18-
<PAGE>
<TABLE>
<CAPTION>



                                                  TMP LAND MORTGAGE FUND, LTD
                                                 (A California Limited Partnership)
                                       Schedule II - Real Estate and Accumulated Depreciation
                                        (Schedule XI, Rule 12-28, for SEC Reporting Purposes
                                                For the Year Ended December 31, 1997

COLUMN    A                  B           C                  D            E               F             G           H           I
-----------------------------------------------------------------------------------------------------------------------------------
                                                   COSTS CAPITALIZED
                                                      SUBSEQUENT       Gross
                                                    TO ACQUISITION   amount at                                             Estimated
                                   Initial                  Carrying which Carried   Accumulated     Date of       Date  Depreciable
Description of Assets Encumbrances  Cost      Improvement     Cost   at Year-End   Depreciation  Construction   Acquired     Life
------------------------------------------------------------------------------------------------------------------------------------
<S>                   <C>          <C>        <C>        <C>         <C>              <C>          <C>        <C>             <C>

Unimproved land -
  San Jacinto         $3,941,330   $ 3,550,000$   63,737 $4,311,391  $7,925,128        -0-           N/A       06/02/94&
                                                                                                               08/11/94        N/A
Unimproved land -
  Sun City                  -0-      1,320,000       638     75,465   1,396,103        -0-           N/A       11/02/94        N/A
Unimproved land -
  Banning                   -0-      1,875,000     1,500    121,355   1,997,855        -0-           N/A       12/21/94        N/A
Unimproved land -
  Sun City                  -0-        159,871     4,780      6,291     666,162        -0-           N/A       03/29/95        N/A
Unimproved land -
  San Diego                 -0-      1,658,000   888,804    139,132   2,685,936        -0-           N/A       08/23/95        N/A
                                     ---------   -------    -------   ---------
Combined encum. -
  other properties       264,738
                         -------
                      $4,206,068   $ 8,903,000$1,114,550 $4,653,634  $14,671,184        -0-
                       =========     ========= =========  =========   ==========        ===

Less valuation allowance:                                            $ 3,983,798
                                                                     -----------
Net carrying value                                                   $10,687,386
                                                                     ===========

Reconciliation of carrying amount
---------------------------------

Beginning balance                  $10,575,184

Additions
Improvements          $  407,660
Carrying Costs/Improv. 1,152,390
                       ---------
  Total Additions                   1,560,050
Deductions:
 Initial Costs         1,220,000
 Improvements             72,794
 Carrying costs          149,528
 Increase in valua-
    tion allowance         5,526
  Total Deductions                  1,447,848
                                    ----------
Ending balance                     $10,687,386
                                    ==========
</TABLE>



                                                                -19-