--------------------------------------------------------------------------------
                                      U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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



                                   FORM 10-QSB


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



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


                  For the quarterly period ended March 31, 2002


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



                         Commission file number 0-11973


                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP
             Organized pursuant to the Laws of the State of Maryland


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



        Internal Revenue Service - Employer Identification No. 52-1321492

                 11200 Rockville Pike, Rockville, Maryland 20852

                                 (301) 468-9200


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





Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 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 o




--------------------------------------------------------------------------------
<PAGE>



                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                              INDEX TO FORM 10-QSB

                      FOR THE QUARTER ENDED MARCH 31, 2002



                                                                         Page

Part I - FINANCIAL INFORMATION

Item 1.  Financial Statements

         Balance Sheets
           - March 31, 2002 and December 31, 2001........................  1

         Statements of Operations and Accumulated Losses
           - for the three months ended March 31, 2002 and 2001..........  2

         Statements of Cash Flows
           - for the three months ended March 31, 2002 and 2001..........  3

         Notes to Financial Statements
           - March 31, 2002 and 2001.....................................  4

Item 2.  Management's Discussion and Analysis of Financial Condition
           and Results of Operations.....................................  9


Part II - OTHER INFORMATION

Item 3.  Defaults Upon Senior Securities................................. 12

Item 5.  Other Information............................................... 12

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

Signature................................................................ 14




<PAGE>
Part I. FINANCIAL INFORMATION
        ---------------------
Item 1. Financial Statements
        ---------------------


                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                                 BALANCE SHEETS


                                     ASSETS

<TABLE>
<CAPTION>
                                                                                             March 31,     December 31,
                                                                                               2002           2001
                                                                                           ------------    ------------
                                                                                            (Unaudited)
<S>                                                                                        <C>             <C>
Investments in and advances to partnerships ............................................   $  1,579,407    $  1,308,952
Investment in partnership held for transfer ............................................         15,154          15,154
Cash and cash equivalents ..............................................................      3,430,830       3,242,912
Acquisition fees, principally paid to related parties,
  net of accumulated amortization of $263,542 and $259,959, respectively ...............        166,445         170,029
Property purchase costs,
  net of accumulated amortization of $246,582 and $243,162, respectively ...............        163,705         167,124
Other assets ...........................................................................            370             108
                                                                                           ------------    ------------

   Total assets ........................................................................   $  5,355,911    $  4,904,279
                                                                                           ============    ============




                   LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)



Due on investments in partnerships .....................................................   $  1,900,000    $  1,900,000
Accrued interest payable ...............................................................      3,110,832       3,052,897
Accounts payable and accrued expenses ..................................................         59,762          78,568
                                                                                           ------------    ------------

   Total liabilities ...................................................................      5,070,594       5,031,465
                                                                                           ------------    ------------

Commitments and contingencies

Partners' capital (deficit):

  Capital paid in:
    General Partners ...................................................................          2,000           2,000
    Limited Partners ...................................................................     50,015,000      50,015,000
                                                                                           ------------    ------------

                                                                                             50,017,000      50,017,000

  Less:
    Accumulated distributions to partners ..............................................    (10,814,009)    (10,814,009)
    Offering costs .....................................................................     (5,278,980)     (5,278,980)
    Accumulated losses .................................................................    (33,638,694)    (34,051,197)
                                                                                           ------------    ------------

      Total partners' capital (deficit) ................................................        285,317        (127,186)
                                                                                           ------------    ------------

      Total liabilities and partners' capital (deficit) ................................   $  5,355,911    $  4,904,279
                                                                                           ============    ============
</TABLE>

                          The accompanying notes are an
                             integral part of these
                              financial statements.

                                       -1-

<PAGE>
Part I. FINANCIAL INFORMATION
        ---------------------
Item 1. Financial Statements
        ---------------------


                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                            STATEMENTS OF OPERATIONS

                             AND ACCUMULATED LOSSES

                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                        For the three months ended
                                                                                 March 31,
                                                                       ----------------------------
                                                                           2002            2001
                                                                       ------------    ------------
<S>                                                                    <C>             <C>
Share of income from partnerships ..................................   $    615,781    $    752,413
                                                                       ------------    ------------

Other revenue and expenses:

  Revenue:
    Interest .......................................................         10,085          79,206
                                                                       ------------    ------------

  Expenses:
    Interest .......................................................         57,935         144,560
    Management fee .................................................         62,499          62,499
    General and administrative .....................................         63,677          55,919
    Professional fees ..............................................         22,250          21,138
    Amortization of deferred costs .................................          7,002           7,002
                                                                       ------------    ------------

                                                                            213,363         291,118
                                                                       ------------    ------------

      Total other revenue and expenses .............................       (203,278)       (211,912)
                                                                       ------------    ------------

Net income .........................................................        412,503         540,501

Accumulated losses, beginning of period ............................    (34,051,197)    (44,081,592)
                                                                       ------------    ------------

Accumulated losses, end of period ..................................   $(33,638,694)   $(43,541,091)
                                                                       ============    ============



Net income allocated to General Partners (1.51%) ...................   $      6,229    $      8,162
                                                                       ============    ============


Net income allocated to Initial and Special Limited Partners (1.49%)   $      6,146    $      8,053
                                                                       ============    ============


Net income allocated to Additional Limited Partners (97%) ..........   $    400,128    $    524,286
                                                                       ============    ============


Net income per unit of Additional Limited Partner Interest
  based on 50,000 units outstanding ................................   $       8.00    $      10.49
                                                                       ============    ============
</TABLE>




                         The accompanying notes are an
                             integral part of these
                             financial statements.

                                      -2-

<PAGE>
Part I. FINANCIAL INFORMATION
        ---------------------
Item 1. Financial Statements
        ---------------------

                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                            STATEMENTS OF CASH FLOWS

                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                                  For the three months ended
                                                                                           March 31,
                                                                                  --------------------------
                                                                                     2002           2001
                                                                                  -----------    -----------
<S>                                                                               <C>            <C>
Cash flows from operating activities:
  Net income ..................................................................   $   412,503    $   540,501

  Adjustments to reconcile net income to net cash used in operating activities:
    Share of income from partnerships .........................................      (615,781)      (752,413)
    Amortization of deferred costs ............................................         7,002          7,002

    Changes in assets and liabilities:
      Increase in advances to partnerships ....................................        (1,118)          --
      (Increase) decrease in other assets .....................................          (262)           734
      Increase in accrued interest payable ....................................        57,935        144,560
      Decrease in accounts payable and accrued expenses .......................       (18,806)      (109,453)
                                                                                  -----------    -----------

        Net cash used in operating activities .................................      (158,527)      (169,069)
                                                                                  -----------    -----------

Cash flows from investing activities:
  Receipt of distributions from partnerships ..................................       346,445        769,220
                                                                                  -----------    -----------

Net increase in cash and cash equivalents .....................................       187,918        600,151

Cash and cash equivalents, beginning of period ................................     3,242,912      6,292,654
                                                                                  -----------    -----------

Cash and cash equivalents, end of period ......................................   $ 3,430,830    $ 6,892,805
                                                                                  ===========    ===========
</TABLE>

                          The accompanying notes are an
                             integral part of these
                              financial statements.

                                       -3-

<PAGE>
                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS

                             March 31, 2002 and 2001

                                   (Unaudited)


1.   BASIS OF PRESENTATION
     ---------------------

     In the opinion of C.R.I.,  Inc. (CRI), the Managing  General  Partner,  the
accompanying unaudited financial statements reflect all adjustments,  consisting
of normal recurring accruals, necessary for a fair presentation of the financial
position of Capital Realty Investors-II Limited Partnership (the Partnership) as
of March 31, 2002,  and the results of its operations and its cash flows for the
three months ended March 31, 2002 and 2001.  The results of  operations  for the
interim  period  ended March 31, 2002,  are not  necessarily  indicative  of the
results to be expected for the full year.

     The  accompanying  unaudited  financial  statements  have been  prepared in
conformity with accounting principles generally accepted in the United States of
America  and with the  instructions  to Form  10-QSB.  Certain  information  and
accounting  policies and  footnote  disclosures  normally  included in financial
statements prepared in conformity with accounting  principles generally accepted
in the United States of America have been condensed or omitted  pursuant to such
instructions. These condensed financial statements should be read in conjunction
with the financial  statements and notes thereto  included in the  Partnership's
annual report on Form 10-KSB at December 31, 2001.


2.   INVESTMENTS IN AND ADVANCES TO PARTNERSHIPS
     -------------------------------------------

a.   Due on investments in partnerships and accrued interest payable
     ---------------------------------------------------------------

                              Purchase money notes
                              --------------------

     The  Partnership's  obligations  with respect to its  investments  in Local
Partnerships,  in the  form  of  nonrecourse  purchase  money  notes  having  an
aggregate  principal  balance of $1,900,000 plus aggregate  accrued  interest of
$3,110,832  as of March 31, 2002,  are payable in full upon the earliest of: (i)
sale or refinancing of the respective Local Partnership's rental property;  (ii)
payment in full of the respective Local  Partnership's  permanent loan; or (iii)
maturity.

     The purchase money notes,  which are  nonrecourse to the  Partnership,  are
generally  secured  by  the  Partnership's  interest  in  the  respective  Local
Partnerships.  There is no assurance  that the underlying  properties  will have
sufficient appreciation and equity to enable the Partnership to pay the purchase
money notes'  principal and accrued  interest when due. If a purchase money note
is not paid in accordance with its terms,  the  Partnership  will either have to
renegotiate  the terms of repayment or risk losing its  partnership  interest in
the  respective  Local  Partnership.  In the event  that a  purchase  money note
remains unpaid upon maturity,  the noteholder may have the right to foreclose on
the Partnership's interest in the related Local Partnership.

     The  Partnership's  inability  to pay  certain of the  purchase  money note
principal and accrued interest balances when due, and the resulting  uncertainty
regarding the Partnership's  continued  ownership  interest in the related Local
Partnerships,  does not adversely impact the Partnership's  financial  condition
because the  purchase  money  notes are  nonrecourse  and secured  solely by the
Partnership's interest in the related Local Partnerships.  Therefore, should the
investment in any of the Local  Partnerships  with maturing purchase money notes
not produce  sufficient  value to satisfy the related  purchase money notes, the
Partnership's exposure to loss is limited because the

                                       -4-

<PAGE>
                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS

                             March 31, 2002 and 2001

                                   (Unaudited)


2.   INVESTMENTS IN AND ADVANCES TO PARTNERSHIPS - Continued
     -------------------------------------------

amount of the nonrecourse  indebtedness  of each of the maturing  purchase money
notes exceeds the carrying amount of the investment in, and advances to, each of
the related Local Partnerships.  Thus, even a complete loss of the Partnership's
interest in one of these Local  Partnerships  would not have a material  adverse
impact on the financial condition of the Partnership.

     The  Managing  General  Partner  is  continuing  to  investigate   possible
alternatives to reduce the Partnership's  debt obligations.  These  alternatives
include, among others, retaining the cash available for distribution to meet the
purchase money note  requirements,  paying off certain purchase money notes at a
discounted  price,  extending  the due dates of certain  purchase  money  notes,
refinancing the respective properties' underlying debt or selling the underlying
real estate and using the Partnership's share of the proceeds to pay or buy down
certain purchase money note  obligations.  Although the Managing General Partner
has had some success applying these strategies in the past, the Managing General
Partner cannot assure that these strategies will be successful in the future. If
the Managing  General  Partner is unable to negotiate an extension or discounted
payoff,  in the event that the purchase money notes remain unpaid upon maturity,
the noteholders may have the right to foreclose on the Partnership's interest in
the related Local Partnerships. In the event of a foreclosure, the excess of the
nonrecourse   indebtedness   over  the  carrying  amount  of  the  Partnership's
investment  in the related Local  Partnership  would be deemed  cancellation  of
indebtedness income, which would be taxable to Limited Partners at a federal tax
rate  of  up  to  38.6%.  Additionally,  in  the  event  of a  foreclosure,  the
Partnership  would lose its investment in the Local  Partnership and,  likewise,
its share of any future  cash flow  distributed  by the Local  Partnership  from
rental operations, mortgage debt refinancings, or the sale of the real estate.

     The Managing General Partner  continues to address the maturity of its debt
obligations  and to seek solutions that will provide the most favorable  outcome
to  the  limited  partners.  However,  there  can  be no  assurance  that  these
strategies will be successful.

     Interest  expense on the  Partnership's  purchase money notes for the three
months ended March 31, 2002 and 2001 was $57,935 and $144,560, respectively. The
accrued  interest  payable  on  the  purchase  money  notes  of  $3,110,832  and
$3,052,897 as of March 31, 2002 and December 31, 2001,  respectively,  is due on
the respective  maturity  dates of the purchase money notes or earlier,  in some
instances,  if (and to the  extent  of a  portion  thereof)  the  related  Local
Partnership  has  distributable  net cash flow, as defined in the relevant Local
Partnership agreement.

                              Frenchman's Wharf II
                              --------------------

     The Partnership defaulted on its purchase money note related to Frenchman's
Wharf Associates II Limited  Partnership  (Frenchman's Wharf II) on June 1, 1998
when the note matured and was not paid.  The default amount  included  principal
and accrued interest of $3,150,000 and $5,071,731,  respectively. As of June 22,
2001,  principal  and  accrued  interest  totaling  $3,150,000  and  $6,131,166,
respectively,  were due. The purchase  money note was initially due to mature on
June 1, 1988, but was extended to mature on June 1, 1998.

     In January 2001, the Local Partnership  entered into a contract to sell the
property.  However,  the purchaser was unable to consummate  the purchase.  As a
result, in accordance with

                                       -5-

<PAGE>
                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS

                             March 31, 2002 and 2001

                                   (Unaudited)


2.   INVESTMENTS IN AND ADVANCES TO PARTNERSHIPS - Continued
     -------------------------------------------

the  forbearance  agreement,  on June 22, 2001, the property was  transferred by
deed-in-lieu of foreclosure to an assignee of the mortgagee. The transfer of the
property and resulting loss of the  Partnership's  interest in Frenchman's Wharf
II resulted in extraordinary gain from  extinguishment of debt of $9,281,166 and
loss on  disposition of  investments  in  partnerships  of $56,217 for financial
statement  purposes  in 2001,  and a total gain of  $16,450,868  for federal tax
purposes in 2001.

                                    Princeton
                                    ---------

     The  Partnership  defaulted on its purchase money note related to Princeton
Community  Village  Associates  (Princeton)  on  January  1,  1999 when the note
matured and was not paid.  The default  amount  included  principal  and accrued
interest  of  $500,000  and  $1,422,064,  respectively.  On August 9, 1999,  the
noteholder filed a complaint seeking  declaratory  judgment that the Partnership
had forfeited its interest in Princeton to the  noteholder.  The  litigation was
settled  effective  January 1, 2000,  when the Managing  General Partner entered
into an agreement with the noteholder  which granted the noteholder four options
to purchase the Partnership's  98.99% limited partner interest in Princeton over
a three and one-half year period,  in exchange for the  cancellation of pro-rata
portions of the then outstanding  balance of the purchase money note. As part of
the agreement,  the noteholder  extended the maturity date of the purchase money
note to January 1, 2004, and the Partnership made a payment to the noteholder on
April 21,  2000,  which was  applied  against  accrued  interest  payable on the
purchase  money  note.  However,  pursuant  to the  option  agreement  with  the
noteholder,  the noteholder can exercise its acquisition of the final portion of
the Partnership's interest between January 1, 2003 and June 30, 2003. Therefore,
the  Partnership  has selected the earliest  maturity date of the purchase money
note to be June 30, 2003.

     On both June 1, 2001 and May 31,  2000,  pursuant to the option  agreement,
the  noteholder  purchased  26%  of  the  Partnership's   original  interest  in
Princeton, the consideration for which was the cancellation of a like percentage
of the  outstanding  purchase  money  note  accrued  interest  of  $392,333  and
$493,027,  respectively,  resulting in extraordinary gain from extinguishment of
debt of $384,123 and $484,862 for financial statement purposes in 2001 and 2000,
respectively,  and in  cancellation  of  indebtedness  income of $1,583,512  and
$1,960,030 for federal tax purposes in 2001 and 2000, respectively. On April 11,
2002, the noteholder  exercised its option to acquire half of the  Partnership's
remaining  limited  partner  interest in Princeton,  which  transfer will likely
close in June 2002.

     Due to the  impending and likely  transfer of the  remaining  46.99% of the
Partnership's   investment  in  Princeton,   the  net  unamortized   amounts  of
acquisition fees and property purchase costs related to Princeton, which totaled
$15,154 as of both March 31, 2002 and December 31, 2001, have been  reclassified
to  investment  in  partnership  held for transfer in the  accompanying  balance
sheets.

                                       -6-

<PAGE>
                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS

                             March 31, 2002 and 2001

                                   (Unaudited)


2.   INVESTMENTS IN AND ADVANCES TO PARTNERSHIPS - Continued
     -------------------------------------------

b.   Advances to Local Partnership
     -----------------------------

     To cover a tax liability  incurred in 2001 by Troy  Apartments  Ltd.  (Troy
Manor),  the  Partnership  advanced  funds of $1,118 as of March 31, 2002.  This
advance  is  payable  from  cash flow of Troy  Manor.  For  financial  reporting
purposes,  this advance has been reduced to zero by the  Partnership as a result
of losses at the Local Partnership level.

c.   Property matters
     ----------------

                                Country Place II
                                ----------------

     The Section 8 Housing  Assistance  Payments (HAP) contract for the property
owned by Second Blackburn Ltd. Partnership (Country Place II) originally expired
August  29,  2000.  The  Section 8 HAP  contract  covers  20% of the  property's
apartment units. The Local  Partnership has caused the Section 8 HAP contract to
be renewed periodically,  with the current renewal period expiring in June 2002,
at which time the Local Partnership intends to opt out of the HAP program.

                                Orangewood Plaza
                                ----------------

     The 1983 construction loan related to Orangewood Plaza, a 40-unit apartment
complex in Orange Cove, California,  was never formally converted to a permanent
loan. It is now  anticipated  that this loan will be  restructured  in 2002 as a
permanent  loan,  with no tax  impact to either  the  Local  Partnership  or the
Partnership. There is no assurance that the restructuring will be consummated.

     In 1983, the Partnership  pledged its interest in the Local  Partnership as
security on an  acquisition  note, in the amount of $170,000,  made by the Local
Partnership. The note matured on July 28, 1998 and was not paid when due. On May
7, 2001, the  Partnership  made a capital  contribution of $198,241 to the Local
Partnership,  which  amount was used to pay in full the  principal  and  accrued
interest on the acquisition note.

d.   Summarized financial information
     --------------------------------

     Combined  statements of operations for the 14 and 15 Local  Partnerships in
which the Partnership was invested as of March 31, 2002 and 2001,  respectively,
follow. The combined statements have been compiled from information  supplied by
the management agents of the projects and are unaudited.  The combined statement
of operations  for the three months ended March 31, 2001,  includes  information
for Frenchman's Wharf II.

                                       -7-

<PAGE>
                 CAPITAL REALTY INVESTORS-II LIMITED PARTNERSHIP

                          NOTES TO FINANCIAL STATEMENTS

                             March 31, 2002 and 2001

                                   (Unaudited)


2.   INVESTMENTS IN AND ADVANCES TO PARTNERSHIPS - Continued
     -------------------------------------------


                        COMBINED STATEMENTS OF OPERATIONS
                                   (Unaudited)

                                                  For the three months ended
                                                           March 31,
                                                 ----------------------------
                                                    2002              2001
                                                 ----------        ----------

         Revenue:
           Rental                                $4,816,866        $4,861,740
           Other                                    282,460           211,391
                                                 ----------        ----------

             Total revenue                        5,099,326         5,073,131
                                                 ----------        ----------

         Expenses:
           Operating                              2,904,192         2,990,201
           Interest                               1,267,747         1,428,191
           Depreciation and amortization            819,015           910,645
                                                 ----------        ----------

             Total expenses                       4,990,954         5,329,037
                                                 ----------        ----------

         Net income (loss)                       $  108,372        $ (255,906)
                                                 ==========        ==========


     As of March 31, 2002 and 2001, the Partnership's share of cumulative losses
to  date  for 10 and 11 of  the  14  and 15  Local  Partnerships,  respectively,
exceeded the amount of the  Partnership's  investments  in and advances to those
Local  Partnerships  by  $21,058,523  and  $26,154,823,   respectively.  As  the
Partnership has no further  obligation to advance funds or provide  financing to
these  Local  Partnerships,  the excess  losses have not been  reflected  in the
accompanying financial statements.


3.   RELATED PARTY TRANSACTIONS
     --------------------------

     In accordance with the terms of the Partnership Agreement,  the Partnership
is obligated to reimburse the Managing  General  Partner for its direct expenses
in connection with managing the  Partnership.  The Partnership  paid $59,966 and
$41,971 for the three month periods ended March 31, 2002 and 2001, respectively,
to the Managing General Partner as direct  reimbursement of expenses incurred on
behalf of the  Partnership.  Such  expenses  are  included  in the  accompanying
statements of operations as general and administrative expenses.

     In accordance with the terms of the Partnership Agreement,  the Partnership
is obligated to pay the Managing General Partner an annual incentive  management
fee (Management  Fee), after all other expenses of the Partnership are paid. The
Partnership  paid the Managing  General  Partner a Management Fee of $62,499 for
each of the three month periods ended March 31, 2002 and 2001.



                                      # # #

                                       -8-

<PAGE>
Part I. FINANCIAL INFORMATION
        ---------------------
Item 2. Management's Discussion Analysis of Financial Condition
        -------------------------------------------------------
          and Results of Operations
          -------------------------


     Capital  Realty  Investors-II   Limited   Partnership's  (the  Partnership)
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations section contains  information that may be considered forward looking,
including  statements regarding the effect of governmental  regulations.  Actual
results  may differ  materially  from those  described  in the  forward  looking
statements and will be affected by a variety of factors  including  national and
local economic  conditions,  the general level of interest  rates,  governmental
regulations  affecting the Partnership and interpretations of those regulations,
the  competitive   environment  in  which  the  Partnership  operates,  and  the
availability of working capital.

                                     General
                                     -------

     Some of the rental properties owned by the Local  Partnerships are financed
by state housing agencies.  The Managing General Partner has sold or refinanced,
and will continue to sell or refinance,  certain properties pursuant to programs
developed by these agencies.  These programs may include opportunities to sell a
property to a qualifying  purchaser  who would agree to maintain the property as
low to  moderate  income  housing,  or to  refinance  a  property,  or to obtain
supplemental  financing.  The  Managing  General  Partner  continues  to monitor
certain state  housing  agency  programs,  and/or  programs  provided by certain
lenders, to ascertain whether the properties would qualify within the parameters
of a given  program and whether  these  programs  would  provide an  appropriate
economic benefit to the limited partners of the Partnership.

     Some of the rental properties owned by the Local Partnerships are dependent
on the receipt of  project-based  Section 8 Rental Housing  Assistance  Payments
(HAP)  provided by the U.S.  Department of Housing and Urban  Development  (HUD)
pursuant  to Section 8 HAP  contracts.  Current  legislation  allows all expired
Section 8 HAP contracts  with rents at less than 100% of fair market rents to be
renewed for up to one year.  Expiring  Section 8 HAP  contracts  with rents that
exceed  100% of fair market  rents  could be renewed for up to one year,  but at
rents  reduced  to 100% of fair  market  rents  (Mark-to-Market).  All  expiring
Section 8 HAP  contracts  with rents  exceeding  comparable  market  rents,  and
properties  with mortgage  loans insured by the Federal  Housing  Administration
(FHA), became subject to the Mark-to-Market legislation.

     Mark-to-Market (M2M) implementation will reduce rental income at properties
that are currently  subsidized  at  higher-than-market  rental  rates,  and will
therefore  lower cash flow  available to meet  mortgage  payments and  operating
expenses.  In some instances,  a property will be able to meet its existing debt
service  payments  after the  reduction  in rental  income.  In this  case,  the
property  may enter  the M2M  "Lite"  program  which  would  not  require a debt
restructuring.  In the remaining  instances,  the affected  property may undergo
debt restructuring  according to terms determined by an individual  property and
operations  evaluation.  This would  involve  reducing the first  mortgage  loan
balance to an amount  supportable  by the  property's  operations,  taking  into
account the property's operating expenses and reduced income. The balance of the
amount  written down from the first  mortgage  loan would be converted to a non-
performing but accruing  (soft) second  mortgage  loan.  When the existing first
mortgage loan is bifurcated  into a first and second  mortgage  loan,  the newly
created  second  mortgage  loan will  accrue  interest at a  below-market  rate;
however,  the  Internal  Revenue  Service  issued a  ruling  in July  1998  that
concluded that the below-market  rate of interest would not generate  additional
ordinary  income.  Each property  subject to M2M will be affected in a different
manner, and it is very difficult to predict the exact form of restructuring,  or
potential tax liabilities to the limited partners, at this time. All properties,
upon entering the M2M program  (excluding M2M Lite),  are required to enter into
an agreement restricting the property's use to affordable housing for 30 years.

                                       -9-

<PAGE>
Part I. FINANCIAL INFORMATION
        ---------------------
Item 2. Management's Discussion Analysis of Financial Condition
        -------------------------------------------------------
          and Results of Operations - Continued
          -------------------------

     Finally, under HUD's "Mark-up-to-Market"  program, properties with expiring
Section 8 HAP  contracts  that are located in high-rent  areas as defined by HUD
are eligible  for rent  increases  which would be  necessary to bring  Section 8
rents in line with market rate rents.  For properties that enter the program and
have interest  rate  subsidized  FHA loans,  the rents are adjusted to take into
account the  benefits the property is already  receiving  from the  below-market
interest rate by means of a  HUD-determined  adjustment  factor.  The purpose of
this program is to provide  incentives  to owners of  properties  with  expiring
Section 8 HAP contracts not to convert these properties to market rate housing.

     In return for  receiving  market  rate rents under  Mark-up-to-Market,  the
property  owner must enter into a five year  conditional  Section 8 HAP contract
with HUD,  subject  to the  annual  availability  of  funding  by  Congress.  In
addition,  property  owners who enter into the  Mark-up-to-  Market program will
receive  increased  cash flow as the limited  dividend  will be  increased in an
amount equal to the increase in gross revenues.

     Country  Place II has a  Section 8 HAP  contract  which  covers  20% of the
property's  apartment  units.  The current  renewal  period of the Section 8 HAP
contract  expires in June 2002, at which time the Local  Partnership  intends to
opt out of the HAP program.

     As of March 31, 2002, the carrying amount of the Partnership's  investments
in and advances to Local  Partnerships with Section 8 HAP contracts  expiring in
the next 12 months was $96,505.

     The Managing  General  Partner  continues to seek  strategies  to deal with
affordable  housing policy.  Where  opportunities  exist,  the Managing  General
Partner will continue to work with the Local  Partnerships to develop strategies
that make economic sense.

                          Financial Condition/Liquidity
                          -----------------------------

     The Partnership's liquidity, with unrestricted cash resources of $3,430,830
as of March 31, 2002, along with anticipated  future cash distributions from the
Local  Partnerships,  is  expected  to be  adequate  to  meet  its  current  and
anticipated  operating  cash  needs.  As of May 6, 2002,  there were no material
commitments for capital expenditures.

     The  Partnership's  obligations  with respect to its  investments  in Local
Partnerships,  in the  form  of  nonrecourse  purchase  money  notes  having  an
aggregate  principal  balance of $1,900,000 plus aggregate  accrued  interest of
$3,110,832  as of March 31, 2002,  are payable in full upon the earliest of: (i)
sale or refinancing of the respective Local Partnership's rental property;  (ii)
payment in full of the respective Local  Partnership's  permanent loan; or (iii)
maturity.

     See the notes to financial  statements contained in Part I, Item 1, hereof,
for information concerning purchase money notes.

     The purchase money notes,  which are  nonrecourse to the  Partnership,  are
generally  secured  by  the  Partnership's  interest  in  the  respective  Local
Partnerships.  There is no assurance  that the underlying  properties  will have
sufficient appreciation and equity to enable the Partnership to pay the purchase
money notes'  principal and accrued  interest when due. If a purchase money note
is not paid in accordance with its terms,  the  Partnership  will either have to
renegotiate  the terms of repayment or risk losing its  partnership  interest in
the  respective  Local  Partnership.  In the event  that a  purchase  money note
remains unpaid upon maturity the  noteholders may have the right to foreclose on
the Partnership's interest in the related Local Partnership.


                                      -10-

<PAGE>
Part I. FINANCIAL INFORMATION
        ---------------------
Item 2. Management's Discussion Analysis of Financial Condition
        -------------------------------------------------------
          and Results of Operations - Continued
          -------------------------

     The  Partnership's  inability  to pay  certain of the  purchase  money note
principal and accrued interest balances when due, and the resulting  uncertainty
regarding the Partnership's  continued  ownership  interest in the related Local
Partnerships,  does not adversely impact the Partnership's  financial  condition
because the  purchase  money  notes are  nonrecourse  and secured  solely by the
Partnership's interest in the related Local Partnerships.  Therefore, should the
investment in any of the Local  Partnerships  with maturing purchase money notes
not produce  sufficient  value to satisfy the related  purchase money notes, the
Partnership's  exposure to loss is limited because the amount of the nonrecourse
indebtedness  of each of the maturing  purchase money notes exceeds the carrying
amount  of the  investment  in,  and  advances  to,  each of the  related  Local
Partnerships. Thus, even a complete loss of the Partnership's interest in one of
these  Local  Partnerships  would  not have a  material  adverse  impact  on the
financial condition of the Partnership.

     The  Managing  General  Partner  is  continuing  to  investigate   possible
alternatives to reduce the Partnership's  debt obligations.  These  alternatives
include, among others, retaining the cash available for distribution to meet the
purchase money note  requirements,  paying off certain purchase money notes at a
discounted  price,  extending  the due dates of certain  purchase  money  notes,
refinancing the respective properties' underlying debt or selling the underlying
real estate and using the Partnership's share of the proceeds to pay or buy down
certain purchase money note  obligations.  Although the Managing General Partner
has had some success applying these strategies in the past, the Managing General
Partner cannot assure that these strategies will be successful in the future. If
the Managing  General  Partner is unable to negotiate an extension or discounted
payoff,  in the event that the purchase money notes remain unpaid upon maturity,
the noteholders may have the right to foreclose on the Partnership's interest in
the related Local Partnerships. In the event of a foreclosure, the excess of the
nonrecourse   indebtedness   over  the  carrying  amount  of  the  Partnership's
investment  in the related Local  Partnership  would be deemed  cancellation  of
indebtedness income, which would be taxable to Limited Partners at a federal tax
rate  of  up  to  38.6%.  Additionally,  in  the  event  of a  foreclosure,  the
Partnership  would lose its investment in the Local  Partnership and,  likewise,
its share of any future  cash flow  distributed  by the Local  Partnership  from
rental operations, mortgage debt refinancings, or the sale of the real estate.

     The Managing General Partner  continues to address the maturity of its debt
obligations  and to seek solutions that will provide the most favorable  outcome
to  the  limited  partners.  However,  there  can  be no  assurance  that  these
strategies will be successful.

     The Partnership closely monitors its cash flow and liquidity position in an
effort to ensure that sufficient  cash is available for operating  requirements.
For the three  month  periods  ended  March 31,  2002 and 2001,  the  receipt of
distributions  from Local  Partnerships  was adequate to support  operating cash
requirements.  Cash and cash equivalents increased during the three month period
ended March 31, 2002, as the receipt of  distributions  from Local  Partnerships
exceeded net cash used in operating activities.

                              Results of Operations
                              ---------------------

     The  Partnership's  net income for the three month  period  ended March 31,
2002 decreased from the corresponding period in 2001 primarily due to a decrease
in share of income from partnerships  related to cash distributions in excess of
basis received from two Local Partnerships in the first quarter of 2001, but not
2002, partially offset by higher rental income at another property. Contributing
to the  decrease  in the  Partnership's  net income  were a decrease in interest
revenue due to lower cash and cash equivalent  balances and lower interest rates
in 2002,  and  higher  general  and  administrative  expenses  related to higher
reimbursed payroll costs.  Partially offsetting the decrease in net income was a
decrease in interest  expense due to a lower  purchase money note balance in the
first quarter of 2002 compared to the first quarter of 2001.

                                      -11-

<PAGE>
Part I. FINANCIAL INFORMATION
        ---------------------
Item 2. Management's Discussion Analysis of Financial Condition
        -------------------------------------------------------
          and Results of Operations - Continued
          -------------------------

     For financial reporting purposes, the Partnership,  as a limited partner in
the Local  Partnerships,  does not record losses from the Local  Partnerships in
excess of its  investment  to the  extent  that the  Partnership  has no further
obligation to advance funds or provide financing to the Local Partnerships. As a
result, the Partnership's  share of income from partnerships for the three month
periods  ended March 31, 2002 and 2001 did not  include  losses of $275,281  and
$370,039, respectively.

     No other  significant  changes in the  Partnership's  operations have taken
place during this period.


Part II. OTHER INFORMATION
         -----------------
Item 3. Defaults upon Senior Securities
        -------------------------------

     See Note 2.a. of the notes to  financial  statements  contained  in Part I,
Item 1,  hereof,  for  information  concerning  the  Partnership's  defaults  on
purchase money notes.


Item 5. Other Information
        -----------------

     There  is no  established  market  for the  purchase  and  sale of units of
additional limited partner interest (Units) in the Partnership, although various
informal  secondary market services exist. Due to the limited markets,  however,
investors may be unable to sell or otherwise dispose of their Units.

                                  Tender offers
                                  -------------

     On March 13, 2001, Bond Purchase,  L.L.C.  (Bond) initiated an unregistered
tender offer to purchase  approximately  2,475 of the  outstanding  Units in the
Partnership at a price of $53 per Unit;  the offer expired April 30, 2001.  Bond
is unaffiliated with the Partnership or the Managing General Partner.  The price
offered was determined solely at the discretion of Bond and does not necessarily
represent the fair market value of each Unit.

     The  Managing  General  Partner did not  express  any opinion and  remained
neutral toward the Bond offer for the purchase of Units described above.

     On or about May 10,  2001,  Limited  Partners in the  Partnership  may have
received an  unregistered  tender offer from Peachtree  Partners  (Peachtree) to
purchase  their  units  of  Limited  Partner  interest  for the cost of the $100
transfer fee.

     The Managing  General Partner  recommended that Limited Partners reject the
Peachtree  offer because it concluded  that the tender offer was  inadequate and
not in the best interests of the Limited Partners.

     On June 22, 2001,  Equity  Resources  Lexington  Fund  Limited  Partnership
(Lexington)  initiated a registered tender offer to purchase up to 10,000 of the
outstanding  Units in the  Partnership  at a price of $100 per  Unit;  the offer
expired July 23, 2001.  On November 19, 2001,  Lexington  initiated a registered
tender  offer  to  purchase  up to  10,000  of  the  outstanding  Units  in  the
Partnership  at a price of $100 per Unit;  the offer expired  December 19, 2001.
Lexington is unaffiliated  with the Partnership or the Managing General Partner.
The prices offered were determined  solely at the discretion of Lexington and do
not necessarily represent the fair market value of each Unit.


                                      -12-

<PAGE>
Part II. OTHER INFORMATION
         -----------------
Item 5. Other Information - Continued
        -----------------


     In response to the Lexington tender offers, on July 5, 2001 and December 3,
2001, the Managing General Partner filed Schedules 14D-9. In those filings,  the
Managing General Partner  recommended that Limited Partners reject the Lexington
offers because it viewed the offer prices as inadequate.

     During 2001, a number of investors  sold their Units in the  Partnership to
other investors as a result of the tender offers  described  above. If more than
five percent of the total  outstanding  Units in the Partnership are transferred
due to sale in any one calendar year (not counting  certain  exempt  transfers),
the  Partnership  could  be  taxed  as a  "publicly  traded  partnership,"  with
potentially  severe tax  implications  for the  Partnership  and its  investors.
Specifically,  the Partnership  could be taxed as a corporation  and, if so, the
income and losses from the  Partnership  would no longer be considered a passive
activity.  From  January  1, 2001,  through  August 13,  2001,  the  Partnership
received sale transfer requests for approximately  4.9% of the total outstanding
Units.  Accordingly,  to remain  within the five percent safe harbor,  effective
August  13,  2001,  the  Managing  General  Partner  halted  recognition  of any
transfers that would exceed the safe harbor limit through  December 31, 2001. As
a result,  transfers of Units due to sales  transactions  were not recognized by
the  Partnership  between  August 14, 2001 and December  31, 2001.  The halt was
lifted  effective  January 1, 2002.  For the calendar  year 2002 to May 6, 2002,
Units  transferred  have  not  exceeded  4.9% of the  total  outstanding  Units;
therefore, the Partnership has not halted recognition of transfers.

                                Cash distribution

     On May 2, 2001,  the  Partnership  made a cash  distribution  of $3,244,150
($65.00 per Unit) to Additional  Limited  Partners who were holders of record as
of April 1, 2001.


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

     a.   None

     b.   No  reports  on Form 8-K were  filed  with the  Commission  during the
          quarter ended March 31, 2002.

     All other items are not applicable.

                                      -13-

<PAGE>
                                    SIGNATURE


     In accordance  with the  requirements  of the Exchange Act, the  registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                           CAPITAL REALTY INVESTORS-II LIMITED
                             PARTNERSHIP
                           -----------------------------------------------------
                           (Registrant)

                            by:  C.R.I., Inc.
                                 -----------------------------------------------
                                 Managing General Partner




May 6, 2002                      by:  /s/ Michael J. Tuszka
-----------                           ------------------------------------------
DATE                                  Michael J. Tuszka
                                        Vice President
                                        and Chief Accounting Officer
                                        (Principal Financial Officer
                                        and Principal Accounting Officer)

                                      -14-