<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549


_____________________


FORM 10-Q



[ 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 0-19847


FIRST MORTGAGE CORPORATION
(Exact name of registrant as specified in its charter)



California                              95-2960716
(State or other jurisdiction            (I.R.S. Employer
of incorporation or                     Identification No.)
organization)





3230 Fallow Field Drive
Diamond Bar, California 91765
(Address, including zip code, of principal executive offices)

(909) 595-1996
(Registrant's telephone number, including area code)



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____

As of September 30, 1996, 5,883,117 shares of the registrant's common
stock were outstanding.

<PAGE>
FIRST MORTGAGE CORPORATION
FORM 10-Q

INDEX
Part I - Financial Information                                 Page


Item 1. Financial Statements:

Balance Sheet
September 30, 1996 (Unaudited) and March 31, 1996                 3

Unaudited Statements of Income
Three Months and Six Months Ended September 30, 1996 and 1995     4

Unaudited Statements of Cash Flows
Six Months Ended September 30, 1996 and 1995                      5

Notes to Unaudited Financial Statements                           6-7

Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations                               8-12


Part II - Other Information

Item 6. Exhibits and Reports on Form 8-K                         13

Signatures                                                       14

<PAGE>
<TABLE>
PART I.  FINANCIAL INFORMATION

Item 1.   Financial Statements

FIRST MORTGAGE CORPORATION

BALANCE SHEET
<CAPTION>
                                           September 30, 1996      March 31, 1996
                                                  (Unaudited)         
<S>                                               <C>                 <C>
ASSETS                                                                   
Cash                                               $4,179,000          $5,948,000
Mortgage loans held for sale                       17,336,000          19,879,000
Investment in commercial paper                              -           9,955,000
Other receivables and servicing advances           10,928,000           9,545,000
Originated mortgage servicing rights net            4,510,000           3,133,000
Excess service fee, net                               358,000             414,000
Purchased servicing rights, net                       491,000             430,000
Property and equipment, net                           620,000             612,000
Prepaid expenses and other assets                     799,000             891,000
Due from affiliates                                   134,000             194,000
Notes receivable                                      630,000             130,000
                                                                       
TOTAL ASSETS                                      $39,985,000         $51,131,000
                                                        
LIABILITIES AND STOCKHOLDERS' EQUITY                       
                                                        
LIABILITIES:                                            
   Notes payable, banks                           $10,560,000         $20,653,000
   Note payable, officer                            1,500,000           1,500,000
   Sight drafts payable                               916,000           2,699,000
   Accounts payable and accrued liabilities           717,000             765,000
   Deferred income taxes                            1,131,000             867,000
                                                        
      Total Liabilities                            14,824,000          26,484,000
                                                      
STOCKHOLDERS' EQUITY                                    
   Preferred stock, no par value:                       
      Authorized shares - 1,000,000                     
      Issued and outstanding shares - None                  -                   -
   Common stock, no par value:                          
      Authorized shares -  10,000,000         
      Issued and outstanding shares- 5,883,117      5,261,000           5,261,000
   Retained earnings                               19,900,000          19,386,000
                                                        
         Total Stockholders' Equity                25,161,000          24,647,000
                                                        
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY        $39,985,000         $51,131,000
See accompanying notes
</TABLE>
                                                        
<PAGE>
<TABLE>
FIRST MORTGAGE CORPORATION

UNAUDITED STATEMENTS OF INCOME


<CAPTION>
                                   Three Months Ended          Six Months Ended
                                   September 30,               September 30,
                                   1996          1995          1996          1995
<S>                                <C>           <C>           <C>           <C>
REVENUES:                                                                    
   Loan origination income          $944,000     $1,230,000    $1,675,000    $2,180,000
   Loan servicing income           1,778,000      1,678,000     3,492,000     3,365,000
   Gain on sale of mortgage loans  1,631,000      1,907,000     2,545,000     4,335,000
   Interest income                   559,000        619,000     1,186,000     1,054,000
   Other income                        1,000              -         2,000        10,000
                                                                 
         Total revenues            4,913,000      5,434,000     8,900,000    10,944,000
                                                                 
EXPENSES:                                                        
   Employees' salaries and                                                              
      commissions                  2,127,000      1,989,000     3,965,000     3,952,000
   General and                                                   
      administrative expenses      1,886,000      1,634,000     3,635,000     3,149,000
   Interest expense                  216,000        191,000       410,000       404,000
                                                                 
         Total expenses            4,229,000      3,814,000     8,010,000     7,505,000
                                                                 
INCOME BEFORE INCOME TAXES           684,000      1,620,000       890,000     3,439,000
                                                                 
INCOME TAX EXPENSE                   287,000        698,000       376,000     1,453,000
                                                                 
NET INCOME                          $397,000       $922,000      $514,000    $1,986,000
                                                                 
                                                                 
NET INCOME PER SHARE                   $0.07          $0.16         $0.09         $0.34
                                                                 
WEIGHTED AVERAGE OF COMMON                                         
   AND COMMON EQUIVALENT                                            
   SHARES OUTSTANDING              5,892,000      5,883,000     5,892,000     5,883,000
                                   
See accompanying notes                                                                 
</TABLE>
  <PAGE>
  <TABLE>
  FIRST MORTGAGE CORPORATION
  UNAUDITED STATEMENTS OF CASH FLOWS
  <CAPTION>
                                                             Six Months
                                                             Ended
                                                             September 30,
                                                             1996           1995
  <S>                                                        <C>            <C>          
  CASH FLOWS FROM OPERATING ACTIVITIES:                      
     Net income                                                $  514,000     $1,986,000
     Adjustments to reconcile net income to net cash         
        provided by operating activities:                     
     Provision for deferred income taxes                          264,000        538,000
     Provision for losses on foreclosure                          277,000        235,000
     Amortization of originated mortgage servicing rights,       
        excess service fee and purchased servicing rights         720,000        501,000
     Depreciation and amortization of property and equipment       97,000        100,000
     Originations and purchases of mortgage loans                                          
        held for sale                                        (171,997,000)  (170,528,000)
     Sales and principal repayments of mortgage loans
        held for sale                                         174,540,000    175,108,000
     Changes in other receivables and servicing advances       (1,660,000)    (1,419,000)
     Additions to excess service fee                                    -         (2,000)
     Change in prepaid expenses and other assets                   92,000       (781,000)
     Change in accounts payable and accrued liabilities           (48,000)       491,000
     Change in income taxes payable                                     -        912,000
                                                                
  Net cash provided by operating activities                     2,799,000      7,141,000
                                                                                             
  CASH FLOWS FROM INVESTING ACTIVITIES:                        
     Purchase of mortgage servicing rights                       (189,000)        (2,000)
     Origination of mortgage servicing rights                  (1,913,000)    (2,202,000)
     Change in Notes receivable                                  (500,000)       120,000
     Sale of commercial paper                                   9,955,000              -
     Purchase furniture, equipment and leasehold improvements    (105,000)       (30,000)
     Proceeds from sale of assets                                       -          1,000
     Change in due from affiliates                                 60,000              -
  
  Net cash provided by (used in) investing activities           7,308,000     (2,113,000)
  
  CASH FLOWS FROM FINANCING ACTIVITIES:
     Change in notes payable, banks                           (10,093,000)     3,519,000
     Change in sight drafts payable                            (1,783,000)     1,339,000
     Change in notes payable, other                                     -     (9,493,000)
  
        Net cash used in financing activities                 (11,876,000)    (4,635,000)
  
  INCREASE (DECREASE) IN CASH                                  (1,769,000)       393,000
  
  CASH, BEGINNING OF PERIOD                                     5,948,000      4,748,000
  
  CASH, END OF PERIOD                                          $4,179,000     $5,141,000
  
  SUPPLEMENTAL CASH FLOW INFORMATION:
     Cash paid during the period for:
        Interest                                               $  147,000     $  326,000
        Income taxes                                               30,000        800,000
See accomanying notes  
</TABLE>
  
<PAGE>
FIRST MORTGAGE CORPORATION
NOTES TO UNAUDITED FINANCIAL STATEMENTS
September 30, 1996

1.  BASIS OF PRESENTATION

    The accompanying unaudited financial statements have been prepared
    in accordance with generally accepted accounting principles for
    interim financial information and in accordance with the
    instructions to Form 10-Q and Regulation S-X.  In the opinion of
    management, all adjustments (consisting only of normal recurring
    accruals) necessary for a fair presentation of the results for the
    interim periods have been included.  The results of operations for
    the interim periods are not necessarily indicative of the results
    to be expected for the full year.  In addition, this document
    should be read in conjunction with the financial statements and
    footnotes included in the Company's annual report on Form 10-K for
    fiscal year ended March 31, 1996

    The preparation of the financial statements of the Company requires
    management to make estimates and assumptions that affect reported
    amounts.  These estimates are based on information available as of
    the date of the financial statements.  Therefore, actual results
    could differ from those estimates.


2.  MORTGAGE SERVICING ASSETS

    Mortgage servicing assets consist of excess service fees, purchased
    servicing rights and originated mortgage servicing rights.
    Activities in each category are summarized as follows:
<TABLE>
<CAPTION>
                                Excess        Purchased       Originated
                                Service       Servicing       Mortgage
                                Fee           Rights          Servicing
                                                        Rights
<S>                             <C>           <C>             <C>
Balance at March 31, 1996       $ 414,000     $   430,000     $  3,133,000
   Additions                            -         189,000        1,913,000
   Amortizations and              (56,000)       (128,000)        (527,000)
   write offs
   Impairment                           -               -           (9,000)
                                                                           (1)
Balance at September 30, 1996   $ 358,000     $   491,000     $  4,510,000

<FN>
<F1>
    (1) Figure includes $199,000 of originated mortgage servicing
    rights relating to mortgage loans held for sale to investors.
    Since the underlying loans have not yet been sold, no revenues have
    been recognized on these originated mortgage servicing rights for
    the three months ended September 30, 1996.
</FN>
</TABLE>

3.  NOTES PAYABLE

    At September 30, 1996, the Company had line of credit agreements
    with two nonaffiliated banks, which provided for borrowings up to
    $30,000,000 and $15,000,000 with annual interest payable monthly at
    1.25% or the bank's reference rate, depending on the level of
    borrowings and the compensating balances maintained.  At September
    30, 1996, borrowings under these lines of $10,560,000 were
    collateralized by mortgage loans held for sale.

    At March 31, 1996, advances of $9,955,000 against one of the lines
    of credit was collateralized by commercial paper which matured in
    April 1996.  The advance was repaid and there was no investment in
    commercial paper at September 30, 1996.

<PAGE>
The line of credit agreements are subject to renewal on September 1997.
    Both agreements contain certain requirements, including, but not
    limited to, the maintenance of minimum net worth, debt to net worth
    ratio, current ratio, net income and servicing portfolio, and
    restrict the Company's ability to pay dividends.  The Company
    believes its two lines of credit agreements will be renewed prior
    to their expiration.

    The Company has a presale funding facility with a nonaffiliated
    investment banking firm for borrowings under reverse repurchase
    arrangements, collateralized by mortgage loans held for sale pooled
    to form GNMA securities.  There was no amount outstanding on
    September 30, 1996.

    At September 30, 1996, the Company also had an unsecured line of
    credit of $2,000,000 with a nonaffiliated bank which expired on
    October 31, 1996.
    
    
4.  NET INCOME PER SHARE

    Net income per share is computed on the basis of the weighted
    average number of common shares outstanding during each period plus
    the effect of common shares contingently issuable from stock
    options in periods in which they have a dilutive effect.


5.  CONTINGENCIES
    
    The Company is currently a defendant in certain litigation arising
    in the ordinary course of business.  It is management's opinion
    that the outcome of these actions will not have a material effect
    on the financial position or results of operations of the Company.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS


RESULTS OF OPERATIONS:

Three months ended September 30, 1996 compared to three months ended
September 30, 1995.


GENERAL

     The Company reported net income of $397,000 or $0.07 per share for
     the quarter ended September 30, 1996, compared to net income of
     $922,000 or $0.16 per share for the comparable 1995 quarter.  The
     decrease in net income was attributable to a 20% reduction in new
     loan originations resulting from intensive price competition among
     mortgage banking firms and commercial banks.  As a result,
     revenues fell nearly 9.6% while expenses increased by about 10.9%.


REVENUES

     LOAN ORIGINATION INCOME
     For the quarter ended September 30, 1996, the volume of new
     mortgage loans closed decreased by 20% to $79.90 million from
     $99.90 million in the prior year quarter.  The decrease is a
     reflection of higher long-term interest rates, which significantly
     reduced the volume of refinancing loans in the market place, and a
     higher proportion of wholesale loans, which carry lower front-end
     origination fees.

     For the three months ended September 30, 1996 loan origination
     revenue decreased by approximately 23.3% to $944,000 from the
     September 1995 quarter, due primarily to the lower volume of new
     loan originations.

     LOAN SERVICING INCOME
     Loan servicing income, representing the loan servicing fees, late
     charges and other fees earned by the Company for administering the
     loans in its servicing portfolio, rose 6.0% to $1.78 million for
     the three months ended September 30, 1996 from $1.68 million for
     the same period in 1995.  The increase resulted from growth in the
     Company's servicing portfolio.

     As of September 30, 1996, the Company serviced $1.63 billion in
     loans compared to $1.57 billion at September 30, 1995, a net gain
     of 3.8% after prepayments and scheduled amortization of mortgage
     loans.  The growth in the servicing portfolio reflects the
     Company's long-term plan of retaining the servicing rights on most
     loan originations.

<PAGE>
<TABLE>
     The following table sets forth certain information pertaining to
     the servicing portfolio of the Company for the period indicated.
<CAPTION>
                                    Three Months Ended September 30,
                                    1996           1995
                                    (Dollars in thousands except average loan balance)
<S>                                 <C>            <C>
Beginning loan service portfolio    $1,508,765     $1,421,673
          
Add:  Loans originated                  79,902         99,902
                                                      
Less: Prepayment and amortization       55,066         43,624
                                                      
Ending loan servicing portfolio      1,533,601      1,477,951
Sub-Servicing                           97,964         90,721
Total servicing portfolio           $1,631,565     $1,568,672
Average loan balance (end of period)  $ 95,631     $   94,175
</TABLE>
     GAIN ON SALE OF MORTGAGE LOANS
     Due to intense price competition and an increase in long-term
     mortgage interest rates during the quarter, the gain on sale of
     mortgage loans was $1.63 million for the three months ended
     September 30, 1996, a decrease of 14.5% over the 1995 period.

     INTEREST INCOME
     Interest income, which reflects the interest received on mortgage
     loans held for sale, decreased to $559,000 for the three months
     ended September 30, 1996 from $619,000 for the comparable prior
     year quarter.  This decrease is due primarily to the smaller
     mortgage inventory carried by the Company during the September
     1996 quarter.


EXPENSES

     The major components of the Company's total expenses are (i)
     employees' salaries and commissions, (ii) general and
     administrative expenses and (iii) interest expense.  Total
     expenses for the three months ended September 30, 1996 increased
     by 10.9% to $4.23 million from the three months ended September
     30, 1995.  Salaries and commissions were $2.13 million for the
     September 1996 quarter, an increase of 6.9% over the year-ago
     quarter.  General and administrative expense increased by
     $252,000, or 15.4% over prior year.  These higher expenses were a
     direct result of expanding production operations in the quarter
     coupled with higher foreclosure expenses, partially offset by cost
     reduction measures taken by the Company over the past year.

     INTEREST EXPENSE
     Interest expense increased 13.1% to $216,000 for quarter ended
     September 1996 from $191,000 for the same period in 1995.  The
     increase was due to a decrease in the compensating balances used
     to establish our borrowing costs, and a decrease in use of working
     capital for loan fundings.


<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS:

Six months ended September 30, 1996 compared to six months ended
September 30, 1995.


GENERAL

     In the six months ended September 30, 1996, the Company reported
     net income of $514,000 or $0.09 per share, compared to net income
     of $1.99 million or $0.34 per share for the same period of 1995.
     Total revenue decreased by 18.7% to $8.90 million from $10.94
     million in the year earlier six months.  The lower operating
     results were largely due to lower loan origination income and a
     lower gain on sale of mortgage loans for the six month period as
     compared to 1995.


REVENUES

     For the six months ended September 30, 1996, loan origination
     revenue decreased 23.2% to $1.68 million from $2.18 million for
     the six months ended September 30, 1995.  The lower loan
     origination revenue was largely due to a higher proportion of
     wholesale loans, which carry much lower front-end origination
     revenue than retail loans.

     The volume of new mortgage loan originations remained flat at
     $171.99 million from $170.53 million in the comparable period
     last year.

     Loan servicing income, representing the loan servicing fees, late
     charges and other fees earned by the Company for administering
     the loans in its servicing portfolio, rose 3.8% to $3.49 million
     for the six months ended September 30, 1996 from $3.37 million
     for the same period in 1995 after prepayments and schedule
     amortization of mortgage loans.
<TABLE>
     The following table sets forth certain information pertaining to
     the servicing portfolio of the Company for the period indicated:
<CAPTION>
                                       Six Months Ended September 30,
                                       1996           1995
                                       (Dollars in thousands except average loan balance)
<S>                                    <C>            <C>
Beginning loan service portfolio       $1,477,161     $1,401,832
Add: Loans originated                     171,997        170,528
                                                      
Less: Prepayment and amortization         115,557        94,407
                                                      
Ending loan servicing portfolio         1,533,601      1,477,951
Sub-Servicing                              97,964         90,721
Total servicing portfolio              $1,631,565     $1,568,672
Average loan balance (end of period)      $95,631        $94,175
Weighted average interest rate               8.00%          8.18%
</TABLE>

     The sale of mortgages for the six months ended September 30, 1996
     resulted in a gain of $2.55 million compared to a gain of $4.34
     million for the 1995 period.  The gain is primarily impacted by
     two factors:  the escalating price competition and the
     recognition of gains related to originated mortgage servicing
     rights mandated by FAS 122.

<PAGE>
Interest income, which reflects the interest received on mortgage loans
     held for sale, increased 12.5% to $1.19 million for the six
     months ended September 30, 1996 from $1.05 million for the 1995
     period.  This increase was due largely to higher average interest
     rate on mortgage loans and a larger inventory carried by the
     Company during the June, 1996 quarter.


EXPENSES

     The major components of the Company's total expenses are (i)
     employees' salaries and commissions, (ii) general and
     administrative expenses and (iii) interest expenses.  Total
     expenses for the six months ended September 30, 1996 increased by
     $505,000 or 6.7% from the six months ended September 30, 1995.
     Salaries and commission expenses remained flat at $3.97 million
     compared to $3.95 million in the first six months of fiscal year
     1995.  General and administrative expenses increased by 15.4% to
     $3.64 million from the comparable period in 1995.  The increase
     was partly attributable to ongoing implementation of our
     production expansion plan, coupled with higher foreclosure
     expenses.

     There was no material increase in interest expense compared to
     prior year.


LIQUIDITY AND CAPITAL RESOURCES

     The Company's primary liquidity requirement is the funding of its
     new mortgage loans and origination expenses.  To meet these needs,
     the Company relies on warehouse lines of credit with banks, its
     own capital, cash flows from operations and short-term reverse
     repurchase agreements with other investment banking firms.

     The Company's mortgage loans held for sale decreased from $19.88
     million at March 31, 1996 to $17.34 million at September 30, 1996.
     The majority of the cash provided from this decrease was used to
     repay short-term borrowings.  At September 30, 1996, maximum
     permitted borrowings under the warehouse line of credit agreements
     with two nonaffiliated banks totaled $45 million and the amount
     outstanding was $10.56 million.  Borrowings under these facilities
     are secured by mortgage loans.  The agreements contain various
     covenants, including minimum net worth, current ratio, net income,
     servicing portfolio balances, debt to net worth ratio, and
     restrict the Company's ability to pay dividends.  The Company was
     in compliance with all debt covenants at September 30, 1996.  The
     Company believes that the warehouse agreements will be renewed
     when the current terms expire in September 1997.

     In addition to the warehouse lines of credit, the Company may use
     the short-term reverse repurchase agreements provided by other
     investment banking firms in connection with its inventory of
     mortgage loans and mortgage-backed securities.  There was no
     amount outstanding under the agreements at September 30, 1996.

     The Company had stockholders' equity of $25.16 million at
     September 30, 1996.  Management believes that its current
     financing arrangements are adequate to meet its projected
     operation needs.


PROSPECTIVE TRENDS
     
     The increase in long-term interest rates during the first four
     months of the fiscal year had a negative impact on new loan
     originations, particularly those for refinance loans.  Although
     our new loan originations were virtually flat at $172 million for
     the six months ended September 30, 1996 compared to $171 million
     for the six months ended September 30, 1995, the mix of new
     originations tilted more to wholesale rather than retail.

     <PAGE>
We have completed the wholesale expansion phase of our production
     growth plan, and have now moved to the retail branch expansion
     phase, opening new branches in Spokane, Washington and Diamond
     Bar, California.  Both of the new operations are off to a fast
     start, and we plan to continue to expand our retail operations as
     opportunities arise.

     Competition is more intense than at any time in the past, as the
     industry continues consolidation and downsizing.  Pricing
     practices remain cut-throat in most of our markets, particularly
     at the wholesale level in which several of the major banks appear
     to be engaged in a virtual price war for mortgages originated
     through wholesale sources.  With our multiple origination
     channels, the Company remains well-positioned to take advantage of
     whichever channel emerges as the most productive in the future.
     Nevertheless, competition at all levels remains formidable and
     price intensive, and is likely to remain so unless the capacity of
     the mortgage-providing industries finally shrink to the size of
     current demand, or long-term interest rates decline enough to
     stimulate more demand.

<PAGE>
PART II.  OTHER INFORMATION.


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

(a)  No exhibits are filed with this report.

(b)  The Company did not file any reports on Form 8-K during the
     quarter ended September 30, 1996.
<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.


                                     FIRST MORTGAGE CORPORATION
                                     
                                     
                                     
                                     
Date:  November 8, 1996              By S/Clement Ziroli
                                        Clement Ziroli
                                        Chairman of the Board of Directors,
                                        Chief Executive Officer
                                     
                                     
                                     
Date:  November 8, 1996              By S/Pac W. Dong
                                        Pac W. Dong
                                        Executive Vice President,
                                        Chief Financial Officer