FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549
(Mark One)

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

For the quarterly period ended September 30, 1996

                                       OR

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

For the transition period from __________________ to _________________       

Commission file number:  1-11017

                         NORTH AMERICAN MORTGAGE COMPANY
             (Exact name of registrant as specified in its charter)

         Delaware                                      68-0267088
(State or other jurisdiction of                    (I.R.S. Employer
 incorporation or organization)                   Identification No.)

              3883 Airway Drive, Santa Rosa, California, 95403-1699
               (Address of principal executive offices, zip code)

                                 (707) 523-5000
              (Registrant's telephone number, including area code)


                     (Former name, former address and former
                   fiscal year, if changed since last report)

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

     The  number of  shares of Common  Stock,  par value  $.01 per  share,  (the
"Common Stock") outstanding as of November 12, 1996, was 13,956,035.


<PAGE>
<TABLE>


                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements.

                         NORTH AMERICAN MORTGAGE COMPANY
                           CONSOLIDATED BALANCE SHEETS
                             (Dollars in thousands)
<CAPTION>

                                                    September 30, December 31,
                                                         1996         1995
                                                         ----         ----
ASSETS                                                      (Unaudited)


<S>                                                  <C>          <C>
   Cash and cash equivalents ......................  $  18,123    $  12,273
   Advances and other receivables .................     77,215       76,628
   Real estate loans held for sale to investors
       --- net of unearned discounts ..............    479,622      526,913
   Purchased loan servicing .......................        702        1,163
   Originated loan servicing ......................    101,357       56,353
   Excess servicing fees ..........................     21,701       20,559
   Other intangible assets ........................      6,199        6,438
   Property and equipment .........................     37,909       36,339
   Other assets ...................................      9,239        9,702
                                                         -----        -----
                                                     $ 752,067    $ 746,368
                                                     =========    =========
LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES
   Warehouse line of credit .......................  $  96,955    $ 146,833
   Notes payable ..................................    100,704       74,801
   Commercial paper and other borrowings ..........    294,313      279,221
   Subordinated debt ..............................     10,070       10,070
   Accounts payable and other liabilities .........     55,627       42,299
                                                        ------       ------
                                                       557,669      553,224

STOCKHOLDERS' EQUITY
   Convertible preferred stock (1,000,000 shares
       authorized,748,179 shares issued and
       outstanding) ...............................         --           --
   Common stock (50,000,000 shares authorized,
       16,278,951 and 16,257,614 shares issued at
       September 30, 1996, and December 31, 1995,
       respectively) ...............................      163          163
   Additional paid-in capital ......................   110,550     110,250
   Retained earnings ...............................   124,375     101,909
   Treasury stock, at cost - (2,322,916 and 1,140,516
       shares at September 30, 1996 and December 31,
       1995, respectively) .........................  (40,690)     (19,178)
                                                       -------      -------
                                                       194,398      193,144
                                                       -------      -------
                                                     $ 752,067    $ 746,368
                                                     =========    =========

           See accompanying notes to consolidated financial statements.

</TABLE>

                                                               
<PAGE>
<TABLE>

                         NORTH AMERICAN MORTGAGE COMPANY
                CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
          Three Months Ended September 30, 1996 and September 30, 1995
                  (Amounts in thousands, except per share data)
<CAPTION>

                                                            Three Months Ended
                                                              September 30,
                                                             1996       1995
                                                             ----       ----
Income:                                                     
<S>                                                        <C>       <C>
   Loan administration fees, net of excess                  
       servicing fee amortization ........................  $11,186   $10,000
   Loan origination fees .................................   20,702    19,893
   Gain from sales of loans ..............................   22,560    20,629
   Interest income, net of warehouse interest expense ....    7,150     8,010
   Gain from sales of servicing ..........................   12,888    13,795
   Other .................................................    2,350     2,252
                                                            -------   -------
                                                             76,836    74,579
Expenses:
    Personnel ............................................   36,757    32,880
    Other operating expenses .............................   18,434    16,508
    Interest expense .....................................    2,316     2,536
    Depreciation and amortization of property and
        equipment ........................................    1,993     1,790
    Amortization of purchased loan servicing .............      149       177
    Amortization of originated loan servicing ............    2,042       950
    Provision for impairment of originated loan servicing       168        79
    Amortization of other intangibles ....................      102       109
                                                            -------   -------
                                                             61,961    55,029
                                                            -------   -------

    Income before income taxes ...........................   14,875    19,550
    Income tax expense ...................................    5,950     7,427
                                                            -------   -------

NET INCOME ...............................................  $ 8,925   $12,123
                                                            =======   =======

NET INCOME PER SHARE .....................................  $  0.64   $  0.80
                                                            =======   =======

WEIGHTED AVERAGE SHARES OUTSTANDING ......................   13,962    15,087
                                                            =======   =======


          See accompanying notes to consolidated financial statements.

</TABLE>
<PAGE>
<TABLE>

                         NORTH AMERICAN MORTGAGE COMPANY
                CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
          Nine Months Ended September 30, 1996, and September 30, 1995
                  (Amounts in thousands, except per share data)

<CAPTION>
                                                           Nine Months Ended
                                                             September 30,
                                                           1996         1995
                                                           ----         ----
Income:
<S>                                                     <C>           <C>     
   Loan administration fees, net of excess
       servicing fee amortization.....................  $  33,505     $  31,251
   Loan origination fees..............................     61,581        47,868
   Gain from sales of loans...........................     71,531        51,606
   Interest income, net of warehouse interest 
        expense.......................................     20,770        20,394
   Gain from sales of servicing.......................     28,375        38,268
   Other..............................................      6,799         6,195
                                                          -------       -------
                                                          222,561       195,582
Expenses:
    Personnel.........................................    110,326        87,754
    Other operating expenses..........................     53,458        46,459
    Interest expense..................................      6,799         7,044
    Depreciation and amortization of property and
        equipment.....................................      5,739         5,473
    Amortization of purchased loan servicing..........        461           565
    Amortization of originated loan servicing.........      5,572         1,702
    (Recovery)/provision for impairment of 
        originated loan servicing                          (1,884)        2,062
    Amortization of other intangibles.................        316           334
                                                          -------       -------
                                                          180,787       151,393
                                                          -------       -------

    Income before income taxes........................     41,774        44,189
    Income tax expense................................     16,718        16,359
                                                           ------        ------

NET INCOME............................................   $ 25,056     $  27,830
                                                           ======        ======

NET INCOME PER SHARE..................................   $   1.74     $    1.85
                                                           ======        ======

WEIGHTED AVERAGE SHARES OUTSTANDING...................     14,436        15,028
                                                           ======        ======


          See accompanying notes to consolidated financial statements.

</TABLE>
<PAGE>
<TABLE>
                         NORTH AMERICAN MORTGAGE COMPANY
                CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
                  Nine Months Ended September 30, 1996 and 1995
                             (Dollars in thousands)
<CAPTION>

                                                            Nine Months Ended
                                                              September 30,
                                                             1996         1995
                                                            -------     -------
OPERATING ACTIVITIES:

<S>                                                       <C>         <C>     
  Net income.............................................  $ 25,056    $ 27,830
  Adjustments to reconcile net income to net cash
     provided by operating activities:
     Depreciation and amortization.......................    12,126      13,301
     Excess servicing fee income.........................   (25,646)    (31,333)
     Gain from sales of servicing rights.................   (28,375)    (38,268)
     Cash proceeds from sales of servicing rights........    97,909      72,036
  Net decrease in real estate loans held for sale,
     net of unearned discounts...........................    47,291      10,339
  Increase in advances and other receivables.............      (587)     (8,288)
  Increase in accounts payable and other liabilities ....    13,328      11,130
  Decrease (increase) in other assets....................       463        (585)
                                                            --------    --------
       NET CASH PROVIDED BY
       OPERATING ACTIVITIES..............................   141,565      56,162

INVESTING ACTIVITIES:
  Acquisition of assets of branches including
     purchase accounting adjustments.....................       (77)        (26)
  Purchase of servicing rights...........................        --         (80)
  Acquisition of originated servicing rights.............   (95,644)    (65,389)
  Purchase of property and equipment.....................    (7,309)     (1,613)
  Retirement of property and equipment...................       ---         857
                                                           ---------    --------
        NET CASH USED IN INVESTING ACTIVITIES............  (103,030)    (66,251)

FINANCING ACTIVITIES:
  Increases in (principal payments on) long-term debt....     25,903    (10,500)
  Decrease in warehouse lines of credit, commercial paper,
       repurchase agreements, and other  borrowings......    (34,786)   (76,286)
  Purchases of Treasury Stock............................    (21,512)       ---
  Dividends..............................................     (2,590)    (2,706)
  Stock issuance under Incentive Stock Option Plan.......        300      1,883
                                                             --------   --------
        NET CASH USED IN FINANCING ACTIVITIES............    (32,685)   (87,609)
                                                             --------   --------
        INCREASE (DECREASE) IN CASH AND
         CASH EQUIVALENTS................................       5,850   (97,698)
    Cash and cash equivalents at beginning of year.......      12,273   102,045
                                                              -------   -------
         CASH AND CASH EQUIVALENTS AT
          END OF PERIOD..................................   $  18,123  $  4,347
                                                              =======   ========

    Supplemental disclosure of cash flow information
      Cash paid during the period for:
         Interest........................................   $  21,616  $ 15,779
                                                              =======   ========
         Income Taxes....................................   $   6,913  $  1,029
                                                              =======   ========

          See accompanying notes to consolidated financial statements.

</TABLE>
<PAGE>



                         NORTH AMERICAN MORTGAGE COMPANY
             Notes to Consolidated Financial Statements (Unaudited)

Note 1 - Basis of Presentation

     The accompanying  unaudited financial statements of North American Mortgage
Company (the "Company") have been prepared in accordance with generally accepted
accounting  principles for interim financial  information and in accordance with
instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do
not include all of the information and footnotes  required by generally accepted
accounting  principles  for  complete  financial  statements.  In the opinion of
management  of the Company,  all  adjustments  (consisting  of normal  recurring
accruals)  considered  necessary  for a fair  presentation  have been  included.
Operating results for the nine and three month periods ended September 30, 1996,
are not necessarily  indicative of the results that may be expected for the year
ended  December 31, 1996.  For further  information,  refer to the  consolidated
financial  statements and footnotes  thereto  included on Form 10-K for the year
ended December 31, 1995.

Note 2 - Net Income Per Share Information

     Net income per  common  share is  computed  based on the  weighted  average
number of shares outstanding during the period. The potential dilutive effect of
common  stock  equivalents  has not been  included  because  that  amount is not
considered to be material. The weighted average number of shares outstanding for
net income per share was  13,962,000  and  15,087,000 for the three months ended
September 30, 1996,  and 1995,  respectively,  and 14,436,000 and 15,028,000 for
the nine months ended September 30, 1996, and 1995, respectively.

Note 3 - Capitalized Servicing Rights

     Purchased  loan  servicing,  excess  servicing  fees  and  originated  loan
servicing, net of accumulated amortization and impairment were as follows:
<TABLE>
<CAPTION>

                               Purchased Loan  Excess Servicing  Originated Loan
                               Servicing, Net     Fees, Net      Servicing, Net
                               --------------     ---------      --------------
                                           (Dollars in thousands)

<S>                             <C>            <C>              <C>      
Balance at December 31, 1995..  $  1,163       $  20,559        $  56,353
Additions.....................       ---          25,646           95,644
Scheduled Amortization........      (461)         (1,922)          (5,572)
Recovery of Impairment of
 Originated Loan Servicing....       ---             ---            1,884
Basis on Servicing Sales......       ---         (22,582)         (46,952)
                                   -----         -------          ------- 
                                   
Balance at September 30, 1996.  $    702       $  21,701         $ 101,357(1)(2)
                                   =====          ======           =======      
</TABLE>

---------------
(1) Includes  $6,360 of originated  loan  servicing  rights which are related to
    loans held for sale to investors.  No revenues have been  recognized on this
    $6,360 of servicing rights, as the underlying loans have not yet been sold.

(2) At September 30, 1996, the originated loan servicing impairment allowance 
    was approximately $668.

<PAGE>
Note 4 - FAS No. 125

     In June 1996, the Financial  Accounting  Standards  Board issued  Statement
Number 125,  "Accounting  for Transfers  and  Servicing of Financial  Assets and
Extinguishment  of Liabilities"  (FAS No. 125),  which will become  effective on
January 1, 1997. This statement will make the accounting for Originated Mortgage
Servicing  Rights  and  Excess  Servicing  Rights  consistent.  The  Company  is
currently  studying  the  effect  of this  statement,  but does not  expect  the
adoption of the statement to have a material effect on future reported earnings.
                                                                     
<PAGE>

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

Quarter Ended September 30, 1996, Compared with Quarter Ended September 30, 1995

RESULTS OF OPERATIONS

     General  Market  Conditions - Based on current  industry  estimates,  total
United States purchase and refinance  origination levels decreased by 2% to $183
billion in the third  quarter of 1996 from $187  billion in the same period last
year.  While the level of new and existing home  purchases  increased  over last
year,  this  increase  was offset by a lower  level of  refinancings  (see table
below). The level of refinance originations began to decline in February of 1996
when interest rates began to rise; however, by early summer,  refinance activity
leveled off and remained steady through September 1996. Recently, interest rates
have begun to decline.  From  mid-September  through early  November  1996,  the
30-year  fixed  mortgage  rate  declined  from 8.3% to 7.8%.  This interest rate
decline has increased the Company's  refinance loan  applications over September
levels.  To the extent  interest rates remain at existing  levels or move lower,
demand for refinancings may increase.

<TABLE>
<CAPTION>
                                                   1-4 Family U.S. Mortgage
                                                         Originations*
                                                        Third Quarter
                                                    1996              1995
                                                    ----              ----
                                                     (Dollars in billions)

<S>                                                 <C>             <C>   
   New and existing home purchases...........       $ 151           $  133
   Refinancings..............................          32               54
                                                      ---              ---

       Total                                        $ 183           $  187
                                                      ===              ===
</TABLE>

---------------
*   Sources:  Mortgage Bankers  Association  (MBA),  Federal  National  Mortgage
    Association (FNMA), and Federal Home Loan Mortgage Corporation (FHLMC) (1996
    market data based on current estimates).


     The Company's $2.1 billion in loan originations during the third quarter of
1996 were 5% lower than during the same quarter last year. This decrease in loan
origination  volume is  primarily  reflective  of the 2% decrease in total U. S.
mortgage originations for the same period. Refinancings represented 28% of total
originations in the third quarter of 1996 compared with 33% in the third quarter
of 1995.  October 1996 loan applications  were $1.4 billion,  up 7% from October
1995 applications of $1.3 billion. Loan applications for refinancings in October
1996 were 41% of total applications.

     Summary  of  Results - Net  income  for the third  quarter of 1996 was $8.9
million or $0.64 per share, a $3.2 million  decrease from the $12.1 million,  or
$0.80 per share,  earned  during the third  quarter of 1995.  This  decrease  in
earnings  occurred due to  comparatively  higher expense  levels.  Personnel and
operating  expenses  increased due to start-up  costs for new branch offices and
satellites,  hiring costs for new loan  officers  added in  connection  with the
Company's  retail sales  initiative,  as well as from the higher  percentage  of
originations for government loans in the third quarter of 1996. While government
loans are  traditionally  more costly to  produce,  they also have a higher OMSR
value compared to conventional  loans (see discussion of OMSR gains on page 11).
Additionally,  amortization  of originated  loan servicing  increased due to the
higher carrying value for servicing rights in the third quarter of 1996 compared
to 1995.

     Servicing  Rights - The  following  table  sets forth  certain  information
regarding the servicing portfolio of the Company for the periods indicated:

<TABLE>
<CAPTION>
                                                   Quarters Ended September 30,
                                                    1996              1995
                                                    ----              ----
                                                  (Dollars in millions, except 
                                                       Average Loan Size)

   Servicing Portfolio:
<S>                                              <C>              <C>      
     Beginning Portfolio.....................    $ 13,836         $  14,561
       Add:
           Loans Originated..................       2,112             2,227
       Deduct:
           Sales of Servicing Rights.........      (1,891)           (1,881)
           Run-off (1).......................        (426)             (452)
                                                    ------           -------
       Ending Portfolio......................    $  13,631         $  14,455
                                                    ======            ======

       Average Loan Size of
           Ending Portfolio..................    $  97,000         $  96,000
             Weighted Average Interest Rate..         7.79%             7.71%
</TABLE>

---------------
(1)  Run-off  refers to  regular  dollar  amount of the  amortization  of loans,
     prepayments and foreclosures. The annualized run-off rate in both the third
     quarter of 1996 and 1995 was 12%.

     Effective January 1, 1995, the Company adopted FAS No. 122, "Accounting for
Mortgage  Servicing  Rights," an amendment to FAS No. 65. The primary difference
between  FAS No.  122 and FAS No.  65,  as it  relates  to the  Company,  is the
accounting  treatment  for the normal  servicing  fee  associated  with in-house
Originated Mortgage Servicing Rights (OMSRs).  Virtually all of the additions to
the servicing portfolio are OMSRs.  Generally,  under FAS No. 65, OMSRs were not
recorded  as an asset,  while  under FAS No.  122,  the full  value of OMSRs are
capitalized.

     As a result of the  difference in accounting  treatment,  the balance sheet
carrying  value for servicing  rights is  significantly  different  depending on
whether the servicing was originated  before January 1, 1995 (pre-1995) or after
January 1, 1995  (post-1995).  Management  believes  that the total fair  market
value of its pre-1995 servicing rights is substantially more than their carrying
value,   while  the  fair  market  value  of  post-  1995  servicing  rights  is
approximately equal to their total carrying value. In the third quarter of 1996,
the Company sold $1.04 billion of pre-1995  servicing  rights and recorded a net
pre-tax  gain of $12.3  million.  The  prices  received  for  sales in the third
quarter of 1996 may not  necessarily be reflective of the value of the remaining
pre-1995  portfolio,  due to  differences  in portfolio  characteristics  (i.e.,
servicing  fees,  age,  coupon  rates)  and  changes  in market  conditions.  At
September  30,  1996,  the net  balance  sheet  carrying  value (the total OMSR,
Purchased  Servicing and Excess Servicing  Assets) and the principal  balance of
the Servicing Portfolio originated pre-1995 and post-1995 were as follows:
<TABLE>
<CAPTION>
                                                                     Total at
                                       Pre-1995      Post-1995       9/30/96
                                       --------      ---------       -------

<S>                                  <C>           <C>             <C>
  Balance sheet carrying value        
    (In thousands)                    $  1,686      $ 122,074       $ 123,760
                                        ------        -------         -------

  Servicing portfolio principal
    balance (In millions)             $  6,694      $   6,937       $  13,631
                                        ------        -------         -------

    Carrying value percentage              .03%         1.76%           .91%
                                        ------        -------         -------
</TABLE>


     Management  continually  evaluates  the  Company's  investment  in retained
servicing rights and periodically makes decisions to sell servicing rights after
considering  the  following  criteria:  cash  requirements,   market  value  for
servicing  rights  compared to their economic value to the Company,  exposure to
prepayment risk, and earnings  impact.  To the extent the Company elects to sell
pre-1995 servicing rights, virtually all of the net proceeds from such sales are
recognized  as a one-time  gain from sale of servicing due to their minimal book
value.  Of the  approximately  $6.7 billion of pre-1995  servicing  remaining at
September  30,  1996,  the  Company   estimates  that  it  may  be  economically
advantageous  (i.e.,  where market value equals or exceeds the economic value to
the  Company)  to sell only  approximately  $3.8  billion  as part of its future
servicing sales. The Company's  results of operations have historically been and
will  continue  to be  impacted  by the amount  and timing of sales of  pre-1995
servicing rights.

     Historically, when interest rates decline, the incremental value created by
the Company's  production  organization  from higher refinance  originations has
more than offset the loss in value to its  servicing  portfolio  resulting  from
higher  prepayments.  Accordingly,  the Company has not  purchased any financial
prepayment  hedges, but it has relied on its ability to produce new servicing as
a macro-hedge. Under FASB No. 122, however, if rates were to decline, the timing
of additional  production  revenues and any  servicing  impairment  charge,  for
financial  statement  purposes,  may not occur in the same  period.  The Company
could be required to recognize a servicing  impairment  charge in one  reporting
period,  while the  incremental  production  revenues  could be  generated  over
several periods.

     Revenues - Revenues  for the third  quarter of 1996 were $76.8  million,  a
$2.3 million or 3%, increase from $74.6 million in the third quarter of 1995.

     Loan administration fees were $11.2 million in the third quarter of 1996, a
12% increase,  as compared with $10.0 million in the third quarter of 1995. This
increase resulted from an increase in the average servicing fees collected and a
$500,000  reduction in excess servicing  impairment  during the third quarter of
1996. This resulted from lower mortgage  prepayment  expectations  driven by the
general rising rate environment during most of 1996.

     Loan  origination fees were $20.7 million during the third quarter of 1996,
a 4% increase,  as compared with $19.9 million during the third quarter of 1995.
This increase resulted from an increase in average origination fees collected on
each loan, partially offset by a 5% decrease in loan originations. The increase
in average  origination  fees  collected  resulted  from a higher  percentage of
retail  production  in the third  quarter  of 1996 as  compared  to 1995 (42% as
compared with 40%), on which the Company  received  higher  average  origination
fees than it received on wholesale and telemarketing  production, as well as the
introduction  of an equity  line of credit  product  and  increased  revenues on
brokered out loans.

     The gain from sales of loans was $22.6 million  during the third quarter of
1996, as compared with $20.6 million during the third quarter of 1995. Gain from
sales of loans is impacted by three factors:  hedging activity,  price subsidies
and the recognition of gains related to OMSR under FAS 122.

     A summary of the  marketing  results for the third quarter of 1996 and 1995
follows:

<TABLE>
<CAPTION>
                                             Three Months Ended September 30,
                                                  1996              1995
                                                  ----              ----
                                                  (Dollars in thousands)

<S>                                             <C>              <C>     
     Hedging Gains (Losses) ............        $   886          $  (803)

     Pricing Subsidies..................         (7,281)          (7,441)

     OMSR - FAS No. 122.................          28,955           28,873
                                                  ------           ------
                                                $ 22,560         $ 20,629
                                                  ======           ======
</TABLE>

     Third quarter hedging results improved slightly to a gain of $886,000, or 4
basis points on loans  originated  during the quarter,  as compared to a loss of
$803,000,  or 4 basis  points on loans  originated  during the third  quarter of
1995. The improved  hedging  results were partially due to the lower bond market
volatility  in the third  quarter of 1996 as  compared  to the third  quarter of
1995.

     Pricing  subsidies  were $7.3 million in the third  quarter of 1996,  or an
average subsidy of 34 basis points on loans produced, compared with $7.4 million
in the third quarter of 1995, or 33 basis points.  This level of pricing subsidy
reflects the continuing price competition for mortgage loans, particularly those
loans sourced through wholesale brokers.

     OMSR gains  increased to $29.0  million  during the third  quarter of 1996,
compared  with $28.9  million  during the third  quarter of 1995.  This increase
occurred  despite an 8% decrease in the volume of loans sold,  due to changes in
the product mix and market values that resulted in a higher  capitalization rate
during  the third  quarter of 1996.  The  changes in  product  mix  included  an
increase  in  government  loans sold in the third  quarter  of 1996.  Government
originations  increased to 33% of total originations during the third quarter of
1996, compared to 28% during the third quarter of 1995.

     Interest  income,  net of  warehouse  interest  expense,  decreased to $7.2
million  during the third quarter of 1996, as compared with $8.0 million  during
the third quarter of 1995, an 11% decrease.  This decrease  resulted from having
less corporate  funds available to reduce  inventory  related  borrowing.  Since
September 30, 1995,  the Company has used some of its  corporate  funds to repay
debt and repurchase the Company's Common Stock.

     Gain from sales of servicing was $12.9 million  during the third quarter of
1996,  as compared  with $13.8  million  during the third  quarter of 1995, a 7%
decrease.  Gain from sales of  servicing  is affected by the volume of servicing
rights sold, the proceeds  received and the amount of OMSR and excess  servicing
basis associated with each sale.

     The following table  summarizes the items for the third quarter of 1996 and
1995:
<TABLE>
<CAPTION>

                                             Three Months Ended September 30,
                                                 1996              1995
                                                 ----              ----
                                                  (Dollars in millions)

<S>                                          <C>               <C>     
       Principal Sold ...................    $  1,891          $  1,881
                                                =====             =====

       Proceeds*.........................    $   25.1          $   31.9

       OMSR and Excess Basis.............       (12.2)            (18.1)
                                                ------            ------

       Net Gain on Servicing Sales.......    $   12.9          $   13.8
                                                =====             =====
</TABLE>

---------------
* Represents 132 basis points on the principal balance sold in 1996 vs. 169
  basis points in 1995.


     The  comparatively  lower  proceeds for the third quarter of 1996 relate to
differences  in the type of servicing sold (i.e.,  government vs.  conventional)
and the  level of excess  servicing  fees,  which  resulted  in a lower  average
servicing fee in the third  quarter of 1996  compared  with 1995.  The decreased
basis on servicing sold resulted from a lower percentage of post-1995  servicing
sold with OMSR basis (pre-1995  originated  servicing has no OMSR basis since it
was  produced  prior to the  implementation  of FAS No.  122)  during  the third
quarter of 1996 as compared with 1995. (See discussion of Servicing Rights.)

     Expenses - Expenses for the third quarter of 1996 were $62.0 million, a 13%
increase, as compared with $55.0 million during the third quarter of 1995.

     Personnel  costs were $36.8  million for the third  quarter of 1996,  a 12%
increase,  as compared with $32.9  million for the third  quarter of 1995.  This
increase in personnel expenses occurred due to a higher percentage of government
originations  during the third  quarter  of 1996,  as well as start up costs for
seven new  production  offices and ten satellite  origination  locations  opened
during the third  quarter.  The Company also incurred  hiring costs for new loan
officers added in connection with the Company's retail sales  initiative.  Other
operating costs were $18.4 million for the third quarter of 1996,a 12% increase,
as compared to $16.5  million  during the third  quarter of 1995.  This increase
reflects additional operating expenses that were required to operate an expanded
production network during 1996, as well as start up costs for the new production
offices and satellite locations.

     Amortization of originated loan servicing  increased to $2.0 million in the
third quarter of 1996,  as compared  with  $950,000  during the third quarter of
1995.  This increase  related to the increase in the  Originated  Loan Servicing
asset,  which was $101.4  million at  September  30,  1996 and $46.1  million at
September 30, 1995.


Nine Months Ended September 30, 1996, Compared with Nine Months Ended
September 30, 1995

RESULTS OF OPERATIONS

     General Market  Conditions - For the nine month period ended  September 30,
1996,  origination  levels increased by 40% compared to the prior year. This was
in contrast to the third quarter of 1996, in which  origination  levels declined
by 5% compared to the same period in 1995. The reason for the difference in year
to year comparisons  (nine months vs. third quarter) is a function of the trends
of  interest  rates over  these  periods of time.  In 1995,  origination  levels
started  slowly and  increased  throughout  the nine  months as  interest  rates
declined,  while in 1996,  origination  levels  started  more  vigorously,  then
weakened as interest rates rose and refinancings declined (see charts below).

               (Graph)

      30 Year Mortgage Rates

                    1995      1996      
                    ----      ---- 
     
December            9.18%     7.11%
January             9.13%     7.00%
February            8.73%     7.32%
March               8.38%     7.69%
April               8.26%     7.92%
May                 7.85%     8.03%
June                7.53%     8.29%
July                7.79%     8.19%
August              7.88%     8.09%
September           7.62%     8.16%

Source: FHLMC

               (Graph)

North American Mortgage Company Originations
            ($ in millions)

                    1995      1996
                    ----      ----

First Quarter     $ 1,128   $ 2,455    
Second Quarter    $ 1,697   $ 2,487    
Third Quarter     $ 2,227   $ 2,112

Note:  The above graphs show the inverse relationship between interest rates and
loan originations.

     The  aggregate  principal  amount of loan  originations  for the first nine
months of 1996 was $7.1 billion,  a 40% increase,  as compared with $5.1 billion
for the first  nine  months  of 1995.  This  increase  in  production  volume is
reflective of the 37% increase* in the total U. S. mortgage originations for the
same period.

---------------
* Sources:  MBA, FNMA and FHLMC (1996 market data based on current estimates).


     Summary of Results - Net income for the first nine months of 1996 was $25.1
million, or $1.74 per share, as compared with $27.8 million, or $1.85 per share,
earned  during the first  nine  months of 1995.  The 10%  decrease  in  earnings
relative to the 40% increase in  originations  is primarily  attributable to the
following  factors:  (i) higher  discounts given to borrowers to meet escalating
price  competition,  (ii) lower hedge gains due to higher bond market volatility
during the nine months,  and (iii) lower gains from sales of servicing  due to a
higher OMSR basis associated with servicing sales in 1996.

     Servicing  Rights - The  following  table  summarizes  the  activity in the
Company's servicing portfolio for the first nine months of 1996:
<TABLE>
<CAPTION>
                                                 Nine Months Ended September 30,
                                                      1996            1995
                                                      ----            ----
                                                       (Dollars in millions,
                                                     except Average Loan Size)
<S>                                                 <C>             <C>
  Servicing Portfolio:                             
      Beginning Portfolio...................       $ 14,109        $ 14,836
        Add:
             Loans Originated...............          7,054           5,051
        Deduct:
             Sales of Servicing Rights......         (6,032)         (4,398)
             Run-off (1)  ..................         (1,500)         (1,034)
                                                     -------         -------
             Ending Portfolio...............       $ 13,631        $ 14,455
                                               
</TABLE>
--------------
 (1)     Run-off  refers  to  dollar  amount  of  the   amortization  of  loans,
         prepayments  and  foreclosures.  For the first nine months of 1996, the
         annualized  run-off  rate was 14%  compared  with 9% for the first nine
         months of 1995.


     Revenues - Revenues  for the first nine months  ended  September  30, 1996,
were $222.6 million, a $27.0 million,  or 14% increase,  as compared with $195.6
million in the first nine months of 1995.

     Loan administration fees were $33.5 million during the first nine months of
1996, a 7% increase,  as compared with $31.3 million in the first nine months of
1995.  This  increase was due to a $2.0  million  charge for the  impairment  of
excess  servicing  rights  during the first nine  months of 1995,  which did not
recur during the first nine months of 1996.

     Loan  origination  fees were $61.6 million  during the first nine months of
1996, a 29% increase, as compared with $47.9 million in the first nine months of
1995. This increase resulted primarily from a 40% increase in loan originations,
partially offset by a decrease in the average origination fees collected on each
loan. The decrease in the average  origination  fees  collected  resulted from a
higher  percentage of wholesale and  telemarketing  production in the first nine
months of 1996 (63% as compared with 59%), on which the Company  receives  lower
average origination fees than it receives on retail loans.

     The gain from sales of loans was $71.5 million for the first nine months of
1996, as compared with $51.6 million during the first nine months of 1995.  Gain
on sales of  loans  is  impacted  by  three  factors:  hedging  activity,  price
subsidies and the recognition of gains related to OMSR under FAS No. 122.

     A summary of the  marketing  results  for the first nine months of 1996 and
1995 follows:
<TABLE>
<CAPTION>

                                             Nine Months Ended September 30,
                                                 1996              1995
                                                 ----              ----
                                                 (Dollars in thousands)

<S>                                           <C>             <C>      
         Hedging Gains....................    $    541         $ 9,035

         Pricing Subsidies................     (24,984)         (15,600)

         OMSR - FAS No. 122...............      95,974           58,171
                                                ------           ------

                                              $ 71,531         $ 51,606
                                                ======           ======
</TABLE>


     During the first  nine  months of 1996,  hedging  results  were  negatively
impacted  by the upward  movement in interest  rates and  increased  bond market
volatility.  To the extent  that  interest  rates  increase  or the bond  market
remains  volatile,  the  Company's  future  marketing  results may be negatively
affected.

     Pricing  subsidies  increased to $25.0 million during the first nine months
of 1996, or an average  subsidy of 35 basis points on loans  produced,  compared
with $15.6 million,  or 31 basis points,  in the first nine months of 1995. This
increase  reflects  the  continuing  price  competition   within  the  industry,
particularly for loans sourced through wholesale brokers.

     OMSR gains increased to $96.0 million during the first nine months of 1996,
an increase of $37.8  million,  or 65%,  compared  with the first nine months of
1995.  This  increase  was due to a 40%  increase in loans sold during the first
nine months of 1996,  and the fact that  approximately  11% of loans sold during
the  first  nine  months  of  1995  were  originated  in  1994,   prior  to  the
implementation  of FAS No. 122, and  accordingly  did not reflect the additional
gain for the capitalization of the OMSRs.

     Gain from sales of servicing was $28.4 million during the first nine months
of 1996, as compared with $38.3 million  during the first nine months of 1995, a
26% decrease. In the first nine months of 1996, the Company sold $6.0 billion of
servicing  rights at an average price of 162 basis points for total  proceeds of
$97.9 million.  This compares with $4.4 billion sold in the first nine months of
1995 at an  average  price of 164  basis  points  for  total  proceeds  of $72.0
million.  The related gain on sales of servicing  decreased,  however,  due to a
higher level of OMSR and excess  servicing  basis  associated  with sales ($69.5
million for the first nine months of 1996,  as compared  with $33.8  million for
the first nine months of 1995).

     Expenses - Expenses for the first nine months of 1996 were $180.8  million,
a 19% increase,  as compared with $151.4 million during the first nine months of
1995.

     Personnel expenses were $110.3 million for the first nine months of 1996, a
26% increase,  as compared with $87.8 million for the first nine months of 1995.
This  increase  in  personnel  expenses  from  1995  primarily  occurred  in the
residential loan production area. The increase reflects the additional personnel
expenses  that were  required to produce a 40% higher loan  origination  volume,
while at the same time hiring  additional loan officers as part of the Company's
retail production initiative.

     Other operating  expenses increased 15% to $53.5 million for the first nine
months of 1996,  as  compared  with $46.5  million  for the first nine months of
1995. This increase reflects additional operating expenses that were required to
originate  a 40%  higher  origination  volume,  as well as  costs to open 13 new
production offices and numerous satellite  locations during 1996. The percentage
increase in other  operating  expenses  during the first nine months of 1996 was
less  than the  percentage  increase  in loan  production  volume  due to better
absorption of fixed overhead.

     Amortization of originated loan servicing  increased to $5.6 million during
the first nine months of 1996,  as compared  with $1.7 million  during the first
nine months of 1995.  This  increase  related to the increase in the  Originated
Loan Servicing  asset to $101.4 million at September 30, 1996 from $56.4 million
at December 31, 1995 (see FAS No. 122 discussion).

     The  Company  recognized  a  recovery  of  impairment  of  originated  loan
servicing of $1.9 million in the first nine months of 1996,  as compared  with a
$2.1 million  impairment  provision  during the first nine months of 1995.  This
recovery was caused by increasing interest rates during the first nine months of
1996,  which slowed  expected  mortgage  prepayment  speeds on loans the Company
services  and,  as a  result,  increased  the  expected  life  and  value of the
servicing asset.

<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

     The  Company's  primary  financing  requirements  are the  financing of its
warehouse  loan  fundings  and  the  ongoing  net  cost  of the  Company's  loan
originations.  The Company's future cash flow requirements will depend primarily
on the  level of its  loan  originations  and the cash  flow  generated  by,  or
required by, its operations.  The Company expects that loan  origination  volume
will be financed  through  warehouse  borrowings,  borrowings under a commercial
paper  program,  through the use of  "gestation"  facilities  and with corporate
funds.

     The Company  finances its  warehouse  loan funding  requirements  primarily
through a bank  warehouse  line of  credit  and  through  its  commercial  paper
program.  This  financing  requirement  begins at the time of loan  closing  and
extends for an average of  approximately 30 days until the loan is sold into the
secondary  market. On January 23, 1996, the Company entered into a new warehouse
line of credit facility  totaling $1.21 billion.  This line of credit expires on
January  23,  1999.  Effective  August 7, 1996,  the  commitment  amount for the
warehouse line of credit facility was reduced, at the Company's request, to $1.0
billion.

     The Company also has a commercial paper borrowing program. Borrowings under
this $500 million program replace, at a reduced interest rate,  borrowings under
the Company's warehouse line of credit. The warehouse line of credit acts as the
liquidity  backup facility for the commercial paper  borrowings.  In addition to
the warehouse line of credit and commercial paper borrowings,  the Company makes
use of gestation facilities provided by an investment bank, FNMA and FHLMC.

     During the fourth quarter of 1993, the Company sold a combined $100 million
of two,  three,  five,  and seven year medium term notes.  The proceeds from the
sale of these notes are being used for general corporate purposes, which include
the  replacement  of  indebtedness,  financing loan  origination  volume and the
expansion of loan origination capacity.  The Company paid off $25 million of two
year medium term notes on maturity in the fourth quarter of 1995.  During August
1996,  the Company  issued  $26.0  million of seven year  medium term notes.  At
September 30, 1996, $101 million of medium term notes were outstanding, of which
$25.0 million will mature in the fourth  quarter of 1996.  The Company will make
this $25.0 million payment with general corporate funds.

     The Company has paid  quarterly  common stock  dividends  since the initial
public offering on July 15, 1992.  During the third quarter of 1996, the Company
paid  dividends  of $.06 per  share  totaling  $837,032  for  13,950,535  shares
outstanding  on August 1, 1996.  This compares with  dividends paid in the third
quarter  of 1995 of $.06 per  share  totaling  $904,700  for  15,078,336  shares
outstanding on August 1, 1995.

     On February 7, 1996, the Board of Directors authorized the repurchase of up
to 1.5  million  shares of common  stock.  During  the  first,  second and third
quarters of 1996,  the Company  repurchased  329,900,  812,500 and 40,000 shares
with  an  aggregate   cost  of  $6.8   million,   $14.1  million  and  $643,000,
respectively.  As of September 30, 1996,  the Company held  2,322,916  shares in
treasury  stock which were acquired at an aggregate  cost of $40.7  million,  of
which 1,140,516 shares were acquired under a prior Board authorization.

     The Company's net cost of its owned  servicing  rights is financed  through
cash flow from its operations, including the sale of servicing rights.

     During the first nine months of 1996 and 1995, the Company  generated $25.6
million and $31.3 million, respectively, of excess servicing fees as a result of
loan sale transactions. In general, the Company creates excess servicing because
the  secondary  market  price  offered  for  servicing  assets is lower than the
economic  value or the amount the  Company  could  receive by  accumulating  the
assets  and  selling  them as part of a bulk sale at a later  date.  During  the
Company's  holding period of the excess  servicing fee asset,  the Company is at
risk that the asset will  decline  in value and a write  down will be  required,
primarily due to faster  prepayment  speeds, or expectation of faster prepayment
speeds,  resulting from lower  interest  rates,  which could cause  borrowers to
refinance  their mortgage loans being  serviced.  The carrying  amount of excess
servicing  rights was $21.7 million and $20.6 million at September 30, 1996, and
December 31, 1995, respectively.

     During  the  first  nine  months of 1996 and 1995,  the  Company  purchased
property and equipment totaling $7.3 million and $1.6 million, respectively.

<PAGE>

                           PART II - OTHER INFORMATION


  Item 1.      Legal Proceedings.

               The Company is a defendant in certain  litigation  arising in the
               normal course of its business.  Although the ultimate  outcome of
               all pending  litigation  cannot be precisely  determined  at this
               time, the Company believes that any liability  resulting from the
               aggregate  amount of damages for outstanding  lawsuits and claims
               will  not  have  a  material  adverse  effect  on  its  financial
               position.

  Item 2.      Changes in Securities.

               On October 17, 1996, the Board of Directors amended the Company's
               By-Laws to do the  following:  (a) clarify the provision  setting
               the time and place and  notice  for the  meeting  of the Board of
               Directors  following  the  annual  meeting of  stockholders;  (b)
               permit the  Chairman  of the Board,  in  addition to the Board of
               Directors,  to call regular  meetings of the Board of  Directors;
               (c)  permit  special  meetings  of the  Board to be called on one
               day's  notice  rather than two;  (d) provide that the Chairman of
               the Board may call  special  meetings of the Board and  determine
               the place of the meeting, pursuant to the notice provisions;  (e)
               provide  that the  Chairman  of the  Board,  in  addition  to the
               Secretary,  may call special meetings of the Board on the written
               request of two directors; (f) clarify the notice provisions;  (g)
               provide  for one or more  Vice-Chairmen;  (h)  provide  that  the
               President  operates  under the  direction of the Chief  Executive
               Officer, in addition to the Board of Directors;  (i) provide that
               the Chief Executive Officer,  the President or the Secretary,  in
               addition to the Board of Directors,  can direct a new certificate
               to  be  issued  in  place  of  any  lost,   stolen  or  destroyed
               certificate,   upon  such  terms  and  conditions  as  they  deem
               expedient;  (j) provide  that the Chief  Executive  Officer,  the
               President or the  Treasurer,  or any officers or other persons as
               the Chief Executive Officer, the President, the Treasurer, or the
               Board of Directors may designate,  can sign corporate checks; and
               (k) make certain other non-substantive changes.

  Item 3.      Defaults Upon Senior Securities.

               None.

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

               None.

  Item 5.      Other Information.

               None.

<PAGE>



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

               a.   Exhibits

                    3.7       Amended and Restated By-Laws of the Company

                    10.46     American International Companies Directors,
                              Officers and Corporate Insurance Policy

                    10.47     Chubb Group of Insurance Companies Directors and 
                              Officers Liability and Reimbursement Excess Policy

                    11        Statement re Computation of Per Share Earnings

                    27        Financial Data Schedule

               b.   Reports on Form 8-K

                    None.

<PAGE>

                                    SIGNATURE


     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.




                                            NORTH AMERICAN MORTGAGE COMPANY
     

Date:  November 12, 1996                    By:     /s/ MARTIN S. HUGHES
                                               ---------------------------------
                                                      (Martin S. Hughes)
                                                    Executive Vice President,
                                                   Chief Financial Officer and
                                                   Principal Financial Officer