SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q



(Mark One)


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

                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2005


                                       OR


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


                         Commission File Number 1-13237


                                   CHARTERMAC
                                   ----------
         (Exact name of Registrant as specified in its Trust Agreement)


           Delaware                                             13-3949418
--------------------------------                           ---------------------
(State or other jurisdiction of                             (I.R.S. Employer
  incorporation or organization)                             Identification No.)

  625 Madison Avenue, New York, New York                               10022
------------------------------------------                         -------------
 (Address of principal executive offices)                            (Zip Code)


Registrant's telephone number, including area code (212) 317-5700


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
                                      -----  -----


Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Exchange Act Rule 12b-2).  Yes  X  No
                                         -----  -----


As of April 29, 2005, 51,323,062 shares of the Registrant's shares of beneficial
interest were outstanding.



<PAGE>



                                TABLE OF CONTENTS

                                   CHARTERMAC

                                    FORM 10-Q

<TABLE>
<CAPTION>
                                                                                                    PAGE
<S>             <C>           <C>                                                                    <C>
PART I
                Item 1.       Financial Statements                                                    3
                Item 2.       Management's Discussion and Analysis of Financial Condition and
                                  Results of Operations                                              18
                Item 3.       Quantitative and Qualitative Disclosures about Market Risks            26
                Item 4.       Controls and Procedures                                                26

PART II
                Item 1.       Legal Proceedings                                                      28
                Item 2.       Unregistered Sales of Equity Securities and Use of Proceeds            28
                Item 3.       Defaults Upon Senior Securities                                        28
                Item 4.       Submission of Matters to a Vote of Security Holders                    28
                Item 5.       Other Information                                                      28
                Item 6.       Exhibits                                                               28

SIGNATURES                                                                                           29

</TABLE>



     See accompanying notes to condensed consolidated financial statements.

                                       2
<PAGE>



ITEM 1. FINANCIAL STATEMENTS

                           CHARTERMAC AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                             March 31,     December 31,
                                                                               2005           2004
                                                                            -----------    -----------

                                                    ASSETS
<S>                                                                         <C>            <C>
Revenue bonds - at fair value                                               $ 2,198,573    $ 2,100,720
Mortgage servicing rights, net                                                   74,553         32,366
Cash and cash equivalents                                                        95,236         71,287
Cash and cash equivalents - restricted                                           34,723         25,879
Other investments                                                               151,672        187,506
Deferred costs - net of amortization of $20,732 and $19,635                      55,006         57,260
Goodwill                                                                        225,771        206,397
Other intangible assets - net of amortization of $25,017 and $20,847            173,349        177,519
Loan to affiliate                                                                    --          4,600
Other assets                                                                     44,880         40,549
Investments in partnerships of consolidated VIEs                              2,630,687      2,527,455
Other assets of consolidated VIEs                                               311,927        328,559
                                                                            -----------    -----------

Total assets                                                                $ 5,996,377    $ 5,760,097
                                                                            ===========    ===========

                                     LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
  Financing arrangements                                                    $ 1,203,506    $ 1,068,428
  Preferred shares of subsidiary (subject to mandatory repurchase)              273,500        273,500
  Notes payable                                                                 203,146        174,454
  Accounts payable, accrued expenses and other liabilities                       38,094         35,364
  Deferred income                                                                56,937         55,572
  Deferred tax liability                                                         27,018         29,898
  Distributions payable                                                          38,831         38,859
  Notes payable and other liabilities of consolidated VIEs                    1,318,903      1,307,093
                                                                            -----------    -----------

Total liabilities                                                             3,159,935      2,983,168
                                                                            -----------    -----------

Minority interest in consolidated subsidiary - convertible SCUs                 264,449        267,025
                                                                            -----------    -----------
Minority interest in consolidated subsidiary - CMC                                   --          4,394
                                                                            -----------    -----------
Preferred shares of subsidiary (not subject to mandatory repurchase)            104,000        104,000
                                                                            -----------    -----------
Partners' interests in consolidated VIEs                                      1,576,088      1,501,519
                                                                            -----------    -----------

Commitments and contingencies

Shareholders' equity:
  Beneficial owners' equity - Convertible CRA Shareholders; no par value
   (6,552 shares issued and outstanding in 2005 and 2004)                       107,734        108,745
  Beneficial owners' equity - special preferred voting shares; no par
   value (15,172 shares issued and outstanding in 2005 and 2004)                    152            152
  Beneficial owners' equity - other common shareholders; no par value
   (100,000 shares  authorized;  51,540 shares issued and 51,323
   outstanding in 2005 and 51,363 shares issued and 51,229 outstanding
   in 2004)                                                                     767,296        773,165
  Restricted shares granted                                                      (7,981)        (7,922)
  Treasury shares of beneficial interest - common, at cost (217 shares
   in 2005 and 134 shares in 2004)                                               (4,916)        (2,970)
  Accumulated other comprehensive income                                         29,620         28,821
                                                                            -----------    -----------
Total shareholders' equity                                                      891,905        899,991
                                                                            -----------    -----------

Total liabilities and shareholders' equity                                  $ 5,996,377    $ 5,760,097
                                                                            ===========    ===========

</TABLE>



     See accompanying notes to condensed consolidated financial statements.

                                       3
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                     (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                              Three Months Ended
                                                                                   March 31,
                                                                             --------------------
                                                                               2005        2004
                                                                             --------    --------
<S>                                                                          <C>         <C>
Revenues:
  Revenue bond interest income                                               $ 36,456    $ 31,851
  Fee income:
   Mortgage banking                                                             4,081       3,116
   Fund sponsorship                                                             3,311       6,780
   Credit enhancement                                                           2,439       1,897
  Other revenues                                                                7,268       2,669
  Revenues of consolidated VIEs                                                 4,902          --
                                                                             --------    --------
      Total revenues                                                           58,457      46,313
                                                                             --------    --------

Expenses:
  Interest expense                                                             10,812       6,586
  Interest expense of consolidated VIEs                                         6,889          --
  Interest expense - distributions to preferred shareholders of subsidiary      4,724       4,724
  Salaries and benefits                                                        16,653      13,882
  General and administrative                                                    9,591       6,349
  Depreciation and amortization                                                 7,696       6,893
  Derivative instrument ineffectiveness                                            --       3,387
  Other expenses of consolidated VIEs                                          11,294          --
                                                                             --------    --------
     Total expenses                                                            67,659      41,821
                                                                             --------    --------

(Loss) income before other income                                              (9,202)      4,492

Equity in earnings of investments                                                 524         555
Loss on investments held by consolidated VIEs                                 (49,939)         --
Gain on sale of loans                                                           1,704       1,745
Gain (loss) on repayment of revenue bonds                                          (9)        260
                                                                             --------    --------
(Loss) income before allocations and income taxes                             (56,922)      7,052

Income allocated to preferred shareholders of subsidiary                       (1,556)         --
Income allocated to Special Common Units of subsidiary                         (6,065)     (2,918)
Income allocated to minority interests                                             --        (105)
Loss allocated to partners of consolidated VIEs                                70,963          --
                                                                             --------    --------

Income before income taxes                                                      6,420       4,029
Income tax benefit                                                              8,365       2,389
                                                                             --------    --------

Net income                                                                   $ 14,785    $  6,418
                                                                             ========    ========

Allocation of net income to:
  Common shareholders                                                        $ 13,110    $  5,449
  Convertible CRA shareholders                                                  1,675         969
                                                                             --------    --------
      Total for shareholders                                                 $ 14,785    $  6,418
                                                                             ========    ========

Net income per share:
  Basic                                                                      $   0.26    $   0.12
                                                                             ========    ========
  Diluted                                                                    $   0.25    $   0.12
                                                                             ========    ========

Weighted average shares outstanding:
  Basic                                                                        57,821      51,591
                                                                             ========    ========
  Diluted                                                                      58,236      51,839
                                                                             ========    ========

Dividends declared per share                                                 $   0.41    $   0.37
                                                                             ========    ========

</TABLE>



     See accompanying notes to condensed consolidated financial statements.

                                       4
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                   Three Months Ended
                                                                        March 31,
                                                                 ----------------------
                                                                   2005         2004
                                                                 ---------    ---------
<S>                                                              <C>          <C>
 CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income                                                    $  14,785    $   6,418
   Adjustments to reconcile net income to net cash provided by
    (used in) operating activities:
   Loss (gain) on repayment of revenue bonds                             9         (260)
   Depreciation and amortization                                     7,696        6,893
   Income allocated to preferred shareholders of subsidiary          1,556           --
   Income allocated to Special Common Units of subsidiary            6,065        2,918
   Income allocated to minority interests                               --          105
   Non-cash compensation expense                                     1,763        3,784
   Other non-cash expense                                              700          143
   Deferred taxes                                                   (2,880)      (2,022)
   Changes in operating assets and liabilities:
    Mortgage servicing rights                                       (3,270)      (1,317)
    Loan to affiliate                                                4,600           --
    Deferred income                                                (10,027)          16
    Other assets                                                     7,887       (1,131)
    Accounts payable, accrued expenses and other liabilities           682      (15,835)
                                                                 ---------    ---------
Net cash provided by (used in) operating activities              $  29,566    $    (288)
                                                                 ---------    ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Proceeds from revenue bonds and notes                         $  10,499    $  27,786
   Revenue bond acquisitions and fundings                         (111,751)     (91,065)
   Other investments                                                (2,026)      20,981
   Acquisitions, net of cash acquired                                4,654         (835)
   Loan to Capri Capital                                            (6,000)          --
   Mortgage loans funded                                          (107,908)     (89,063)
   Mortgage loans sold                                              87,696      106,102
   Advances to partnerships                                        (29,304)     (52,492)
   Collection of advances to partnerships                           25,749       12,813
   Mortgage loans repaid                                             2,700           --
   Deferred investment acquisition costs                               464          749
   Decrease (increase) in cash and cash equivalents -
    restricted                                                      (8,167)       2,570
                                                                 ---------    ---------

Net cash used in investing activities                            $(133,394)   $ (62,454)
                                                                 ---------    ---------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Distributions to shareholders                                 $ (23,896)   $ (18,846)
   Distributions to preferred shareholders of subsidiary            (1,556)          --
   Distributions to Special Common Unit holders                     (8,663)      (4,038)
   Proceeds from financing arrangements                            247,792      127,569
   Repayments of financing arrangements                           (112,715)     (38,009)
   Increase in notes payable                                        28,692       21,076
   Issuance of common shares                                            68           --
   Retirement of special preferred voting shares                        --          (10)
   Treasury stock purchases                                         (1,946)      (1,328)
   Deferred financing costs                                              1       (2,528)
                                                                 ---------    ---------

Net cash provided by financing activities                          127,777       83,886
                                                                 ---------    ---------

Net increase in cash and cash equivalents                           23,949       21,144
                                                                 ---------    ---------

Cash and cash equivalents at the beginning of the year              71,287       58,257
                                                                 ---------    ---------

Cash and cash equivalents at the end of the period               $  95,236    $  79,401
                                                                 ---------    ---------

</TABLE>


                                   (continued)

     See accompanying notes to condensed consolidated financial statements.

                                       5
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                        Three Months Ended
                                                                                            March 31,
                                                                                  ------------------------------
                                                                                     2005               2004
                                                                                  -----------        -----------
<S>                                                                               <C>                <C>
SUPPLEMENTAL INFORMATION:

Acquisition of CCLP:
-------------------

   Conversion of note receivable                                                  $    70,000
   Increase in mortgage servicing rights                                              (40,974)
   Increase in cash and cash equivalents - restricted                                    (676)
   Decrease in other investments                                                       (7,787)
   Increase in goodwill                                                               (15,826)
   Increase in other assets                                                            (6,239)
   Increase in accounts  payable,  accrued  expenses  and other liabilities             2,708
   Decrease in deferred income                                                         11,391
                                                                                  -----------

Net cash acquired in acquisition of CCLP                                          $    12,597
                                                                                  ===========

Supplemental disclosure of non-cash activities relating to adoption of FIN 46R:

    Increase in revenue bonds                                                                        $    33,821
    Increase in other assets                                                                               4,731
    Increase in investments  in  partnerships  of  consolidated VIEs                                  (2,173,621)
    Decrease in other assets of consolidated VIEs                                                       (210,494)
    Increase  in  notes  payable  and  other liabilities of consolidated VIEs                          1,047,976
    Increase in partners' interests of consolidated VIEs                                               1,297,587
                                                                                                     -----------
                                                                                                     $        --
                                                                                                     ===========

</TABLE>



     See accompanying notes to condensed consolidated financial statements.

                                       6
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2005
                                   (UNAUDITED)



NOTE 1 - BASIS OF PRESENTATION

The  condensed   consolidated  financial  statements  include  the  accounts  of
CharterMac,  its wholly owned and majority owned  subsidiary  statutory  trusts,
companies it controls and entities consolidated pursuant to the adoption of FASB
Interpretation   No.  46(R)  ("FIN  46(R)").   All  intercompany   accounts  and
transactions have been eliminated in consolidation.  Unless otherwise indicated,
"the  Company",  "we" and "us",  as used  throughout  this  document,  refers to
CharterMac  and its  consolidated  subsidiaries.  For the entities  consolidated
pursuant to FIN 46(R), the financial  information  included is as of and for the
three months ended December 31, 2004, the latest practical date available. As we
adopted  FIN 46(R) as of March 31,  2004,  the  operating  results for the first
quarter of 2004 do not include those of consolidated  Variable Interest Entities
("VIEs").

The accompanying  interim financial statements have been prepared without audit.
In the opinion of management,  the financial  statements contain all adjustments
(consisting of only normal  recurring  adjustments)  necessary to present fairly
the  financial  statements  of the interim  periods.  However,  given the highly
seasonal nature of our business,  the operating  results for the interim periods
may not be indicative of the results for the full year.

Certain  information and footnote  disclosures  normally  included in the annual
consolidated   financial  statements  prepared  in  accordance  with  accounting
principles generally accepted in the United States of America ("GAAP") have been
condensed  or  omitted.  It  is  suggested  that  these  condensed  consolidated
financial  statements be read in  conjunction  with the  consolidated  financial
statements  and  notes  thereto  included  in our Form  10-K for the year  ended
December 31, 2004.

Our annual report on Form 10-K for the year ended December 31, 2004,  contains a
summary of our  significant  accounting  policies.  There have been no  material
changes to these  items since  December  31,  2004,  nor have there been any new
accounting  pronouncements pending adoption that would have a significant impact
on our condensed consolidated financial statements.

We are responsible for the unaudited condensed consolidated financial statements
included in this document.  Our condensed  consolidated financial statements are
prepared  on the  accrual  basis of  accounting  in  accordance  with GAAP.  The
preparation of financial  statements in conformity with GAAP requires us to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities and the disclosure of contingent  assets and liabilities at the date
of the  financial  statements  as well as the  reported  amounts of revenues and
expenses  during the reporting  period.  Actual  results could differ from those
estimates.

Certain  amounts from prior years have been  reclassified to conform to the 2005
presentation.

NOTE 2 - ACQUISITIONS

In the first  quarter  of 2005,  we  purchased  the 13% of  CharterMac  Mortgage
Capital  Corporation ("CMC") that we had not previously owned and made the final
payments under the terms of the original purchase agreement.  The total of these
two items  was $7.9  million,  $7.5  million  of which we paid in cash  borrowed
through an acquisition  facility.  This transaction  resulted in $3.6 million of
additional goodwill.

Effective  March 1, 2005, we purchased 100% of the ownership  interests of Capri
Capital  Limited  Partnership  ("CCLP").  The initial  purchase  price was $70.0
million  plus  $1.7  million  of  acquisition   costs,   subject  to  additional
consideration  based on the 2004 financial  results of CCLP's  mortgage  banking
business.  The total purchase price will not exceed $85.0 million  (exclusive of
acquisition  costs) and any  additional  consideration  will be paid  during the
second quarter of 2005. The initial purchase price of $70.0 million was paid via
conversion of an existing loan to CCLP and its affiliates (collectively "Capri")
(see Note 4). Half of any additional consideration will be paid in cash with the
remainder in equity units of a CharterMac subsidiary.

The  acquisition of CCLP was accounted for as a purchase and,  accordingly,  the
results of  operations  are  included in the  condensed  consolidated  financial
statements from the  acquisition  date. We allocated our cost of the acquisition
on the basis of the estimated fair values of the assets and liabilities assumed.
The excess of the  purchase  price over the net of the  amounts  assigned to the
assets  acquired  and   liabilities   assumed  was  recognized  as  goodwill  of
approximately $15.8 million. Certain allocations are preliminary as of March 31,
2005,  including the  allocation  to goodwill,  and will be refined as we gather
further  information  on fair value and  determine the fair values of intangible
assets acquired.

Pro forma  financial  results for CCLP are not presented as the  acquisition was
not material to our assets, revenues or net income.



                                       7
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2005
                                   (UNAUDITED)



NOTE 3 - REVENUE BONDS

The following table summarizes our revenue bond portfolio:

<TABLE>
<CAPTION>

                                                   March 31,        December 31,
          (In thousands)                             2005              2004
-----------------------------------               -----------       -----------
<S>                                               <C>               <C>
Unamortized cost basis                            $ 2,200,172       $ 2,098,944
Gross unrealized gains                                 47,369            50,716
Gross unrealized losses                               (17,021)          (14,653)
                                                  -----------       -----------
Subtotal/fair value                                 2,230,520         2,135,007
  Less: eliminations (1)                              (31,947)          (34,287)
                                                  -----------       -----------
Total fair value per balance sheet                $ 2,198,573       $ 2,100,720
                                                  ===========       ===========

</TABLE>

(1)These bonds are  recorded as  liabilities  on the  balance  sheets of certain
   entities  consolidated  pursuant to FIN 46(R) and are therefore eliminated in
   consolidation.

The fair value and gross  unrealized  losses of our revenue bonds  aggregated by
length of time that individual  bonds have been in a continuous  unrealized loss
position, at March 31, 2005, is summarized in the table below:

<TABLE>
<CAPTION>

                                      Less than       12 Months
(Dollars in thousands)                12 Months        or More          Total
----------------------                ---------       ---------       ----------
<S>                                   <C>             <C>             <C>
Number of bonds                              43              52              95
Fair value                            $ 393,832       $ 340,237       $ 734,069
Gross unrealized loss                 $  (5,252)      $ (11,769)      $ (17,021)

</TABLE>

The  unrealized  losses related to these revenue bonds are due solely to changes
in interest  rates,  in that we calculate  present values based upon future cash
flows from the bonds and  discount  these cash flows at the current  rate on our
recent bond issuances; as rates rise, the fair value of our portfolio decreases.
We have  the  intent  and  ability  to hold  these  bonds to  recovery  and have
therefore concluded that these declines in value are temporary.

The following  summarizes the maturity dates of our revenue bonds,  all of which
have fixed interest rates:

<TABLE>
<CAPTION>

                                                                          Weighted
                                       Outstanding                         Average
      (In thousands)                   Bond Amount       Fair Value     Interest Rate
--------------------------             -----------       -----------    -------------
<S>                                    <C>               <C>                  <C>
Due in less than one year              $     1,481       $     1,489          5.82%
Due between one and five
   years                                    34,953            32,960          7.04
Due after five years                     2,172,455         2,196,071          6.70
                                       -----------       -----------       -------
Total / Weighted Average                 2,208,889         2,230,520          6.71%
                                                                           =======
   Less: eliminations (1)                  (31,082)          (31,947)
                                       -----------       -----------
Total per balance sheet                $ 2,177,807       $ 2,198,573
                                       ===========       ===========

</TABLE>

(1)  These bonds are recorded as  liabilities  on the balance  sheets of certain
     entities consolidated pursuant to FIN 46(R) and are therefore eliminated in
     consolidation.



                                       8
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2005
                                   (UNAUDITED)



The following table summarizes our acquisition  activity and additional fundings
to previously acquired revenue bonds for the three months ended March 31, 2005.

<TABLE>
<CAPTION>

                                                              Weighted         Weighted
                                                               Average          Average
                                                 Face       Construction       Permanent
           (In thousands)                        Amount     Interest Rate    Interest Rate
--------------------------------------          --------    -------------    -------------
<S>                                             <C>             <C>              <C>
Construction/rehabilitation properties          $102,000        5.14%            6.50%
Additional funding of existing bonds            $  9,751        5.55%            6.63%

</TABLE>

During the three  months  ended  March 31,  2005,  one  revenue  bond was repaid
generating net proceeds of approximately $459,000. The bond had a net book value
of approximately $468,000, resulting in a loss of approximately $9,000.

At March 31, 2005, $2.1 billion of revenue bonds were  securitized or pledged as
collateral for our borrowing facilities. Three of these bonds, with a book value
of approximately $31.0 million, are included in the bonds securitized or pledged
as collateral and are eliminated in consolidation as noted in the tables above.

See Note 14 regarding  foreclosure of properties underlying three of our revenue
bonds and other matters regarding underlying properties.

NOTE 4 - OTHER INVESTMENTS

Investments other than revenue bonds consisted of:

<TABLE>
<CAPTION>

                                                        March 31,  December 31,
                 (In thousands)                           2005        2004
--------------------------------------------------      --------   ----------
<S>                                                     <C>         <C>
Investment in equity interests in LIHTC properties      $ 43,693    $ 40,132
Investment in properties under development                 3,152       3,157
Investment in ARCap                                       19,054      19,054
Capri loan                                                20,000      84,000
Mortgage loans receivable                                 53,122      27,480
Other investments                                         12,651      13,683
                                                        --------    --------
   Total other investments                              $151,672    $187,506
                                                        ========    ========

</TABLE>

In July 2004, CM Investor LLC ("CM Investor"), one of our subsidiaries, provided
an interim loan in the  principal  amount of $84.0 million  ("Interim  Loan") to
Capri,  which bore  interest  at a rate of 11.5% per year and matured on January
15, 2005.  In the first  quarter of 2005,  we extended and  converted  the loan,
adding  $6.0  million  to  the  loan  amount.  Upon  conversion,   we  held  two
participating  loans,  one of which allowed us to  participate in the cash flows
of, and in turn was  convertible  into a 100%  ownership  interest in, CCLP. The
other allows us to participate  in the cash flows of, and is convertible  into a
49%  ownership  interest  in, Capri  Capital  Advisors  ("CCA"),  a pension fund
advisory business.  In the first quarter of 2005, we converted the CCLP loan and
acquired the business as an addition to our Mortgage  Banking  segment (see Note
2).  Management  currently  expects  to  convert  the CCA  loan  into an  equity
ownership prior to the end of the loan term, no later than August 2006.

NOTE 5 - GOODWILL AND OTHER INTANGIBLE ASSETS

A. GOODWILL

The following table provides information regarding goodwill by segment:

<TABLE>
<CAPTION>

                                              Fund        Mortgage
       (In thousands)                      Management     Banking        Total
-----------------------------              ----------     --------      --------
<S>                                         <C>           <C>           <C>
Balance at December 31, 2004                $200,153      $  6,244      $206,397
Additions (see Note 2)                          --          19,374        19,374
                                            --------      --------      --------

Balance at March 31, 2005                   $200,153      $ 25,618      $225,771
                                            ========      ========      ========

</TABLE>



                                       9
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2005
                                   (UNAUDITED)



B. OTHER INTANGIBLE ASSETS

The components of other identified intangible assets are as follows:

<TABLE>
<CAPTION>

                                        Estimated
                                          Useful
                                           Life             Gross                   Accumulated
           (In thousands)               (in Years)      Carrying Amount             Amortization                     Net
---------------------------------------- --------    ----------------------    -----------------------     ------------------------
                                                     March 31,  December 31,   March 31,   December 31,    March 31,    December 31,
                                                       2005        2004          2005         2004           2005          2004
                                                     --------   -----------    --------    -----------     --------     -----------
<S>                                          <C>     <C>           <C>           <C>           <C>           <C>          <C>
Amortized identified intangible assets:
  Trademarks and trade names                 21.0    $ 25,100      $ 25,100      $  1,637      $  1,338      $ 23,463     $ 23,762
  Partnership service contracts               9.4      47,300        47,300         6,925         5,661        40,375       41,639
  Transactional relationships                16.7     103,000       103,000        11,542         9,436        91,458       93,564
  General partner interests                   9.0       5,100         5,100           776           634         4,324        4,466
  Joint venture developer relationships       5.0       4,800         4,800         1,315         1,075         3,485        3,725
  Other identified intangibles                9.3       4,427         4,427         2,822         2,703         1,605        1,724
                                         --------    --------      --------      --------      --------      --------     --------
Subtotal/weighted average life               14.5     189,727       189,727        25,017        20,847       164,710      168,880

Unamortized Identified
  Intangible Assets:
  Mortgage Banking Licenses                             8,639         8,639            --            --         8,639        8,639
                                                     --------      --------      --------      --------      --------     --------

Total Identified Intangible
  Assets                                             $198,366      $198,366      $ 25,017      $ 20,847      $173,349     $177,519
                                                     ========      ========      ========      ========      ========     ========

Amortization Expense Recorded                                                    $  4,170      $ 16,684
                                                                                 ========      ========

</TABLE>

The amortization of "other identified  intangibles"  (approximately $477,000 per
year) is included as a reduction to revenue bond interest income as they pertain
to the acquisition of such bond investments.

NOTE 6 - FINANCING ARRANGEMENTS AND NOTES PAYABLE

In March 2005, we terminated  our $100.0 million fixed rate  securitization  and
remarketed the borrowings under the Merrill Lynch P-FLOATs/RITESSM program.

Our $75.0 million  secured  revolving  tax-exempt bond warehouse line expired on
March 31, 2005. There was no outstanding  balance at December 31, 2004 and there
were no  additional  borrowings  during the three months ended March 31, 2005 on
this  warehouse  line.  We plan on  replacing  this  warehouse  line  with a new
facility at some point in the future.

NOTE 7 - DERIVATIVE INSTRUMENTS

As of March 31,  2005,  we have  several  interest  rate swaps with an aggregate
notional amount of $524.0  million,  which are designated as cash flow hedges on
the variable interest payments on our floating rate securitizations. These swaps
are recorded at fair market value, with changes in fair market value recorded in
accumulated other comprehensive income to the extent the hedges are effective in
achieving offsetting cash flows.

We  initiated  one swap in 2001.  We entered into two smaller  swaps,  each with
notional  amounts of $12.0 million and are associated  directly with two revenue
bonds.  The first swap  originated in 2004 and the second  originated in January
2005.The remainder had terms that began in January 2005. These new swaps have an
aggregate  notional amount of $450 million and we entered into the agreements in
2003 and 2004. During the period between the dates we entered into the swaps and
the effective dates, we measured their effectiveness using the hypothetical swap
method.  During the period  ended  March 31,  2004,  we  recorded  an expense of
approximately  $3.4 million  representing the ineffective  portion of the swaps.
There was no  ineffectiveness  in the hedging  relationship  of any of our swaps
during the three months ended March 31, 2005.

We expect  all of the swaps will be highly  effective  in  achieving  offsetting
changes in cash flow throughout their terms.

At  March  31,  2005,  those  interest  rate  swaps  for  which we were in a net
liability position were recorded in accounts payable, accrued expenses and other
liabilities  in the amount of  $500,000.  Those  swaps for which we are in a net



                                       10
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2005
                                   (UNAUDITED)



asset  position  are  recorded  in other  assets in the amount of $3.0  million.
Interest  expense for the three months  ended March 31, 2005 and 2004,  includes
approximately  $1.6 million and  $638,000 for amounts paid or payable  under the
swap agreements.

We estimate that  approximately  $546,000 of the net unrealized loss included in
accumulated  other  comprehensive  income  will be  reclassified  into  interest
expense within the next twelve months.

NOTE 8 - EQUITY

During the three months  ended March 31,  2005,  we  repurchased  83,084  common
shares for a total cost of  approximately  $1.9 million in conjunction  with the
tax withholdings associated with stock based compensation awards to employees.

In addition,  we granted  approximately 62,700 restricted shares to employees at
fair value of  approximately  $1.5 million pursuant to our Incentive Share Plan,
which vest over a three-year period,  and approximately  3,600 restricted shares
to employees at a fair value of approximately $84,000, which vested immediately.

NOTE 9 - RELATED PARTY TRANSACTIONS

General and administrative expense includes shared services fees paid or payable
to The Related Companies,  L.P.  ("TRCLP").  These fees totaled $138,000 for the
three months  ended March 31, 2005,  and $1.3 million for the three months ended
March 31, 2004.

In  addition,  a  subsidiary  of  TRCLP  earned  fees  for  performing  property
management  services for various  properties  held in investment  funds which we
manage.  These fees, which are included in other expenses of consolidated  VIEs,
totaled approximately $963,000 for the three months ended March 31, 2005.

We collect asset management, incentive management and expense reimbursement fees
from   American   Mortgage   Acceptance   Company   ("AMAC"),    an   affiliated
publicly-traded  real estate investment trust. These fees, which are included in
fund sponsorship  income,  totaled  approximately  $648,000 and $515,000 for the
three months ended March 31, 2005 and 2004, respectively.

In June 2004,  we entered  into an  unsecured  revolving  credit  facility  (the
"Revolving  Facility")  with AMAC to  provide  it up to $20.0  million,  bearing
interest at LIBOR plus 300 basis  points,  which is to be used to  purchase  new
investments.  The  Revolving  Facility  has a term of one  year  with a one year
optional extension. In the opinion of management, the terms of this facility are
consistent  with those of transactions  with  independent  third parties.  As of
March 31, 2005, there were no outstanding  advances to AMAC under this facility.
Interest  income  earned from this facility for the three months ended March 31,
2005,  was  approximately  $73,000,  while there was no interest  income for the
comparable period in 2004.

NOTE 10 - COMPREHENSIVE INCOME

Comprehensive  income for the three months ended March 31, 2005 and 2004, was as
follows:

<TABLE>
<CAPTION>

                                                                  Three Months Ended
                                                                       March 31,
                                                                ----------------------
                   (In thousands)                                 2005          2004
------------------------------------------------------------    --------      --------
<S>                                                             <C>           <C>
Net income                                                      $ 14,785      $  6,418
Net unrealized (gain) loss on interest rate derivatives            4,174        (2,292)
Net unrealized loss on revenue bonds:
   Unrealized loss during the period                              (3,366)      (17,738)
   Reclassification adjustment for net gain included in net
   income                                                             (9)         (260)
                                                                --------      --------
Comprehensive income (loss)                                     $ 15,584      $(13,872)
                                                                ========      ========

</TABLE>

NOTE 11 - EARNINGS PER SHARE

Diluted  income per share is  calculated  using the weighted  average  number of
shares  outstanding  during the period plus the  additional  dilutive  effect of
common share  equivalents.  The dilutive effect of outstanding share options and
unvested  share  grants is  calculated  using the  treasury  stock  method.  The
dilutive effect of our subsidiary's  Special Common Units ("SCUs") is calculated



                                       11
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2005
                                   (UNAUDITED)



using the "if-converted  method". The SCUs will always be antidilutive,  because
while the shares are convertible on a one-to-one  basis, the dividends paid will
always be greater than the dividends paid per common share.

<TABLE>
<CAPTION>

                                             Three Months Ended March 31, 2005    Three Months Ended March 31, 2004
                                             ---------------------------------    ---------------------------------
(In thousands, except per share amounts)      Income     Shares      Per Share     Income      Shares     Per Share
----------------------------------------     -------     -------     ---------    -------     --------    ---------
<S>                                          <C>          <C>         <C>         <C>           <C>        <C>
Basic EPS                                    $14,785      57,821      $   0.26    $ 6,418       51,591     $  0.12
                                                                      ========                             =======
Effect of dilutive securities                     --         415                       --          248
                                             -------     -------                  -------     --------

Diluted EPS                                  $14,785      58,236      $   0.25    $ 6,418       51,839     $  0.12
                                             =======     =======      ========    =======     ========     =======

</TABLE>

The number of shares includes common and Convertible Community  Reinvestment Act
Preferred Shares  ("Convertible  CRA Shares") as the Convertible CRA Shares have
the same economic benefits as common shares.

NOTE 12 - BUSINESS SEGMENTS

We operate in four business segments:

1.   Portfolio Investing,  which includes  subsidiaries that invest in primarily
     tax-exempt  first  mortgage  revenue bonds issued by various state or local
     governments,  agencies or  authorities  and other  investments  designed to
     produce federally  tax-exempt income. The revenue bonds are used to finance
     the  new  construction,   substantial   rehabilitation,   acquisition,   or
     refinancing of affordable multifamily housing throughout the United States.

2.   Fund Management, which includes:

     o    Subsidiaries  that sponsor real estate  equity  investment  funds that
          primarily   invest  in   Low-Income   Housing  Tax  Credit   ("LIHTC")
          properties.  In exchange for sponsoring  and managing these funds,  we
          receive  fee  income for  providing  asset  management,  underwriting,
          origination and other services;
     o    A subsidiary which provides  advisory services to AMAC, an affiliated,
          publicly traded real estate investment trust; and
     o    Subsidiaries  that  participate  in credit  enhancement  transactions,
          including   guaranteeing  mortgage  loans  and  specified  returns  to
          investors in LIHTC equity funds, in exchange for guarantee fees.

3.   Mortgage  Banking,  which includes  subsidiaries that originate and service
     primarily multifamily mortgage loans on behalf of third parties, primarily:

     o    the Federal National Mortgage Association ("Fannie Mae");
     o    the Federal Home Loan Mortgage Corporation ("Freddie Mac");
     o    the Federal Housing Authority ("FHA"); and
     o    insurance companies and conduits.

     In exchange for these  origination  and  servicing  activities,  we receive
     origination and servicing fees.

4.   VIEs,  primarily  the  LIHTC  equity  funds  we  sponsor  through  the Fund
     Management segment's subsidiaries,  which we are required to consolidate in
     accordance with FIN 46(R).

Segment results include all direct and contractual revenues and expenses of each
segment and  allocations of indirect  expenses based on specific  methodologies.
These reportable  segments are strategic  business units that primarily generate
revenue  streams  that  are  distinctly  different  and  are  generally  managed
separately.  In prior  years,  results  from credit  enhancement  services  were
included  in  Portfolio  Investing.  We have  reclassified  the  results to Fund
Management to better reflect the management of our businesses.

Additionally,  in prior periods we had eliminated intercompany transactions from
the results of the  segment  earning  profits  from such  transactions.  We have
adjusted  our  presentation  to reflect the full  operations  of each segment to
better reflect the true operations of each business.  We have reclassified prior
years' segment results accordingly.



                                       12
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2005
                                   (UNAUDITED)



The following table provides more information regarding our segments:

<TABLE>
<CAPTION>

                                                         Three Months Ended
                                                             March 31,
                                                    ----------------------------
                  (In thousands)                       2005              2004
                                                    -----------      -----------
<S>                                                 <C>              <C>
REVENUES
   Portfolio Investing                              $    40,000      $    33,543
   Fund Management                                       17,715           11,641
   Mortgage Banking (1)                                   5,870            3,880
   VIEs (2)                                               4,902               --
   Elimination of intersegment transactions             (10,030)          (2,751)
                                                    -----------      -----------
Consolidated                                        $    58,457      $    46,313
                                                    ===========      ===========

NET INCOME BEFORE ALLOCATIONS TO EQUITY HOLDERS
   Portfolio Investing                              $    21,412      $    15,658
   Fund Management                                       (5,221)          (8,079)
   Mortgage Banking (1)                                  (1,098)             560
   VIEs (2)                                                  --               --
   Elimination of intersegment transactions              (1,052)          (1,087)
                                                    -----------      -----------
Consolidated                                             14,041            7,052
   Income allocated to SCUs                              (6,065)          (2,918)
   Income allocated to preferred shareholders            (1,556)              --
   Income allocated to minority interests                    --             (105)
   Income tax benefit                                     8,365            2,389
                                                    -----------      -----------
Consolidated Net Income                             $    14,785      $     6,418
                                                    ===========      ===========

DEPRECIATION AND AMORTIZATION
   Portfolio Investing                              $       961      $       812
   Fund Management                                        4,598            4,632
   Mortgage Banking (1)                                   2,137            1,449
   VIEs (2)                                                  --               --
   Elimination of intersegment transactions                  --               --
                                                    -----------      -----------
Consolidated                                        $     7,696      $     6,893
                                                    ===========      ===========

IDENTIFIABLE ASSETS AT END OF PERIOD
   Portfolio Investing                              $ 5,129,213      $ 4,410,238
   Fund Management                                      824,085          825,305
   Mortgage Banking (1)                                 277,265           65,318
   VIEs (2)                                           2,942,614        2,384,115
   Elimination of intersegment balances              (3,176,800)      (2,706,806)
                                                    -----------      -----------
Consolidated                                        $ 5,996,377      $ 4,978,170
                                                    ===========      ===========

</TABLE>

(1) Includes CCLP beginning March 1, 2005.
(2) Consolidated beginning March 31, 2004, pursuant to FIN 46(R).




                                       13
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2005
                                   (UNAUDITED)



NOTE 13 - COMMITMENTS AND CONTINGENCIES

FORWARD TRANSACTIONS

At March 31, 2005, our Mortgage Banking  subsidiaries had forward commitments of
approximately  $283.0  million for mortgages to be funded in 2005 and later.  As
each lending  commitment has an associated sale  commitment,  the fair values of
each  offset  and,  as a  result,  we  record  no  asset  or  liability  for the
commitments.  In addition,  those subsidiaries had commitments to sell mortgages
totaling $63.7 million. Approximately $53.1 million of this amount was funded as
of March 31,  2005 and are  included  in Other  Investments  as  Mortgage  Loans
Receivable.  The balance of approximately $10.6 million is to be funded later in
2005.

We have entered into  transactions  to purchase  revenue  bonds.  The agreements
require  us,  at  the  earlier  of  stabilization  or  conversion  to  permanent
financing,  to  acquire  Series A and  Series B revenue  bonds at  predetermined
prices and interest  rates.  We are obligated to purchase the revenue bonds only
if construction is completed. We are obligated to buy the Series B revenue bonds
only if, at the date the Series A bonds are stabilized, the property's cash flow
is  sufficient  to provide debt service  coverage of 1.15x for both the Series A
and B bonds.  During the construction  period, a third party lender will advance
funds to the developer, as needed, at a floating rate. These forward commitments
create derivative  instruments under SFAS No. 133, which have been designated as
a cash flow hedge of the  anticipated  funding  of the  revenue  bonds,  and are
recorded at fair value, with changes in fair value recorded in other accumulated
comprehensive  income until the revenue  bonds are funded.  The total  potential
amount we could be required to fund is $184.3 million.

Additionally,  we have certain  other bonds that we fund on an as needed  basis.
The  remaining  balance to be funded on these  drawdown  bonds is  approximately
$15.8 million at March 31, 2005.

MORTGAGE BANKING LOSS SHARING AGREEMENT

Under a master loss sharing agreement with Fannie Mae, we assume  responsibility
for a portion  of any loss that may  result  from  borrower  defaults,  based on
Fannie Mae loss sharing  formulas.  At March 31, 2005,  all of our loans sold to
Fannie Mae consisted of Level I loans,  meaning that we are  responsible for the
first 5% of the unpaid principal  balance and a portion of any additional losses
to a maximum  of 20% of the  original  principal  balance;  Fannie Mae bears any
remaining loss. Pursuant to this agreement,  we are responsible for funding 100%
of  mortgagor  delinquency   (principal  and  interest)  and  servicing  (taxes,
insurance and foreclosure  costs) advances until the amounts  advanced exceed 5%
of the unpaid  principal  balance  at the date of  default.  Thereafter,  we may
request  interim  loss  sharing  adjustments  which allow us to fund 25% of such
advances until final settlement under the agreement.

Our  maximum  exposure  at March  31,  2005,  pursuant  to this  agreement,  was
approximately  $940.4  million  although  this amount is not  indicative  of our
actual  potential  losses.  We maintain an  allowance  for loan losses for loans
originated  under  the  Fannie  Mae  DUS  product  line  at  a  level  that,  in
management's judgment, is adequate to provide for estimated losses. At March 31,
2005, that reserve was approximately  $9.5 million,  which we believe represents
our actual  potential  losses at that time.  Unlike loans  originated for Fannie
Mae, we do not share the risk of loss for loans we originate  for Freddie Mac or
FHA.

Our Mortgage Banking  subsidiaries  maintained,  as of March 31, 2005,  treasury
notes of approximately $14.2 million and a money market account of approximately
$1.2 million, which is included in cash and cash  equivalents-restricted  in the
condensed  consolidated  balance  sheet,  to satisfy  the Fannie Mae  collateral
requirements of $14.7 million.

MORTGAGE POOL CREDIT ENHANCEMENT

In December  2001, we completed a credit  enhancement  transaction  with Merrill
Lynch Capital Services, Inc. ("MLCS"). Pursuant to the terms of the transaction,
we assumed  MLCS's first loss position on a pool of tax-exempt  weekly  variable
rate  multifamily  mortgage  loans.  TRCLP  has  provided  us with an  indemnity
covering  50% of any losses  that we incur as part of this  transaction.  As the
loans  mature or prepay,  the first loss  exposure  and the fees we receive  are
reduced.  The latest maturity date on any loan in the portfolio  occurs in 2009.
The remainder of the real estate exposure after the first loss position has been
assumed by Fannie Mae and Freddie Mac. In connection  with the  transaction,  we
have posted  collateral,  initially  in an amount equal to 50% of the first loss
amount,  which may be reduced to 40% if certain post closing conditions are met.
Our maximum  exposure under the terms of the transaction as of March 31, 2005 is
approximately $19.0 million.

We  performed  due  diligence  on  each  property  in  the  pool,  including  an
examination  of  loan-to-value  and debt service  coverage both on a current and
"stressed"  basis. We analyzed the portfolio on a "stressed" basis by increasing
capitalization  rates and assuming an increase in the low floater bond rate.  As



                                       14
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2005
                                   (UNAUDITED)



of March 31, 2005, the credit  enhanced  properties are performing  according to
their contractual obligations and we do not anticipate any losses to be incurred
on this  guaranty.  Should our analysis of risk of loss change in the future,  a
provision for probable loss might be required pursuant to SFAS No. 5, ACCOUNTING
FOR CONTINGENCIES.

YIELD GUARANTEES

We have entered into several  agreements  with either IXIS  Financial  Products,
Inc.  ("IXIS")  or Merrill  Lynch  (each a  "Primary  Guarantor")  to  guarantee
agreed-upon rates of return for pools of multifamily  properties each owned by a
local  partnership  which in turn, is  majority-owned by a fund sponsored by our
subsidiary,  Related  Capital  Company LLC ("RCC").  In return,  we have or will
receive guarantee fees,  generally at the start of each guarantee period.  There
are seven agreements  guaranteeing returns through the construction and lease-up
phases of the  properties  and there are  seven  other  agreements  guaranteeing
returns from the completion of the  construction and lease-up phases through the
operating phase of the properties.

Total potential  exposure  pursuant to these guarantees is approximately  $460.0
million,  assuming there is no return  whatsoever by the funds. We have analyzed
the expected  operations of the  underlying  properties  and believe there is no
risk of loss at this time as we have never yet been called upon to make payments
under the guarantees.  Should our analysis of risk of loss change in the future,
a provision  for possible  losses might be required  pursuant to SFAS No. 5. The
fair value of these guarantees, representing the deferral of the fee income over
the guarantee  periods,  was $14.9 million as of March 31, 2005.  This amount is
included in deferred income on our condensed  consolidated  balance sheet. Refer
to Note 14 regarding additional  transactions entered into after March 31, 2005,
and potential exposure under existing guarantees.

Some of the local  partnerships have financed their properties with the proceeds
of our revenue bonds.  In these cases,  the Primary  Guarantor has required that
those  revenue  bonds be  deposited  into a trust  pursuant to which the revenue
bonds were divided into senior and subordinated interests with approximately 50%
of each  revenue  bond being  subordinated.  We have  financed  the senior trust
interest  and a portion of  certain of the  subordinate  trust  interests  using
credit  enhancement  from the Primary  Guarantor  as part of the  Merrill  Lynch
P-FLOATs/RITESSM  program.  We use the remaining  subordinate trust interests as
collateral in the Merrill Lynch  P-FLOATs/RITESSM  program.  In connection  with
these yield guarantee  transactions,  we have posted $64.5 million as collateral
with a Primary Guarantor in the form of either cash or revenue bonds.

OTHER GUARANTEES

We have  entered  several  transactions  pursuant  to the terms of which we will
provide credit support to construction lenders for project completion and Fannie
Mae conversion.  In some instances,  we have also agreed to acquire subordinated
bonds to the extent the construction period bonds do not fully convert.

Up until the point of  completion,  we will  guarantee the  construction  lender
reimbursement of any draw on its construction  letter of credit up to 40% of the
stated  amount  of the  letter of  credit.  Following  completion,  up until the
project loan  converts to  permanent  loan status,  we will  guarantee  the full
amount of the letter of credit. We closely monitor these properties, and believe
there is currently no need to provide for any potential loss.

The developer has also issued  several  guarantees to the  construction  lender,
each of which  would be called  upon  before our  guarantees,  and each of which
would be assigned to us should its guarantees be called.

Once the  construction  loans  convert to permanent  loans,  we are obligated to
acquire  subordinated  loans for the  amount  by which  each  construction  loan
exceeds the  corresponding  permanent loan, if any. The subordinated  bonds will
bear interest at 10%. Under Fannie Mae guidelines,  the size of the subordinated
bonds will be limited to a 1.0x debt service  coverage  based on 75% of the cash
flow after the senior debt.

Our maximum exposure, related to these three transactions,  is 40% of the stated
amount of the letter of credit of approximately $37.8 million.

We also provide payment,  operating deficit,  recapture and replacement  reserve
guarantees  as  business  requirements  for  developers  to obtain  construction
financing.  Our maximum  exposure  relating to these guarantees is approximately
$115.3 million.

To date,  we have had minimal  exposure to losses  under  these  guarantees  and
anticipate no material  liquidity  requirements in satisfaction of any guarantee
issued.



                                       15
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2005
                                   (UNAUDITED)



OTHER CONTINGENCIES

We are subject to routine litigation and administrative  proceedings  arising in
the ordinary  course of business.  Management does not believe that such matters
will have a  material  adverse  impact on our  financial  position,  results  of
operations or cash flows.

NOTE 14 - SUBSEQUENT EVENTS

YIELD GUARANTEE TRANSACTION
---------------------------

In April 2005,  we  completed a  transaction  to  guarantee  tax  benefits to an
investor in a partnership  designed to generate  Federal  LIHTCs.  CM Corp.  has
agreed to  back-up  the  guarantee  of a  Primary  Guarantor  of an agreed  upon
internal  rate of return to the  investor  in Related  Capital  Credit  Enhanced
Partners,  L.P. - Series B, for which we will receive  guarantee  fees  totaling
approximately  $7.6  million  in  three  installments,  as well as  acquisition,
partnership  management and asset  management  fees  amounting to  approximately
$10.4 million.

Our total exposure pursuant to this guarantee is $121.6 million,  assuming there
is no return whatsoever by the fund, although we currently expect no loss.

PROPERTY FORECLOSURE
--------------------

In May 2005,  an affiliate of ours  foreclosed  upon the  properties  underlying
three of our  revenue  bonds  which  had an  aggregate  carrying  value of $33.7
million as of March 31, 2005. We have obtained  valuations as of the foreclosure
date indicating fair values of the properties in excess of our carrying amounts.
As a result,  management has concluded  that there was no impairment  related to
the revenue bonds as of March 31, 2005. We are actively marketing the properties
for sale and, as such,  the  properties  will be carried as Real Estate  Owned -
Held for Sale from the foreclosure date forward.

PRS
---

PRS Companies  ("PRS") and Capitol  Realty Group ("CRG") are sponsors of certain
LIHTC  partnerships  for which we hold revenue bonds and/or to which  investment
funds we sponsor  have  contributed  equity.  Information  with respect to these
partnerships is set forth in the table below. A construction  company  affiliate
of PRS also served as general contractor for those partnerships.

PRS recently approached us to discuss financial difficulties in its construction
company. Upon a thorough review regarding its financial condition, we determined
that  the  PRS  construction  company  was  experiencing  significant  financial
difficulties, so that the transfer of control of the PRS and CRG partnerships to
entities   affiliated  with  us  and  the  orderly  termination  of  unfulfilled
construction  contracts  was in our best  interest.  We could then  install  new
general  contractors to complete  construction and capable property  managers to
complete  leasing.  We  determined  that,  if we did not  obtain  control of the
partnerships,  a  bankruptcy  filing by or  against  PRS would be adverse to our
interests  as it would  likely  result in the  reduction  or  cessation  of bond
payments,  could possibly endanger our various tax credit equity investments and
would result in delays in construction completion which could not be quantified.

On April 28,  2005,  affiliates  of ours  acquired  by  assignment  the  general
partnership  interests owned by PRS in the "PRS  Partnerships"  indicated in the
table below.  On April 28,  affiliates of ours also  acquired by assignment  the
general partnership  interests owned by CRG in the "CRG Partnerships"  indicated
in the table below.  We sought control of the CRG  Partnerships  because PRS was
the construction  general  contractor for those  partnerships and PRS' financial
difficulties caused construction  finance shortfalls that have created liquidity
problems for those  partnerships.  We have agreed in  principle  to, among other
things,  provide a $5.0 million revolving line of credit to be used to stabilize
the CRG Partnerships  which will be collateralized by contractual  rights of CRG
and its affiliates to receive fees or other consideration.

In addition to the PRS Partnerships and CRG Partnerships described above, we own
bonds that finance eight other partnerships in which PRS was the general partner
and one other  partnership  in which CRG is the general  partner and PRS was the
construction general contractor.  These partnerships are summarized in the table
below.  On those  deals in which our funds are not the equity  sponsor,  we will
look to the respective  equity investor to take control,  complete  construction
and  stabilize  the  partnerships.  Absent a  satisfactory  resolution,  we will
exercise our available remedies to protect our investments. In those situations,
there is  substantial  equity  in the form of  LIHTCs  in  addition  to the real
estate, both of which are our collateral.

There can be no assurance  that a bankruptcy by or against PRS or its affiliates
may not give rise to additional claims concerning these partnerships.



                                       16
<PAGE>



                           CHARTERMAC AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 2005
                                   (UNAUDITED)



Our potential exposure falls into three categories as follows:

     o    Cash  required to stabilize the  properties - Our current  estimate of
          the maximum  amount of cash that may need to be provided to  stabilize
          the  properties,  taking  into  account  delays  in  construction,  is
          approximately  $10.0 million.  This estimate is based upon our initial
          analyses and information  provided by the developer,  and may increase
          due to unforeseen  construction  delays and other  factors,  while the
          amount may be reduced by additional  contributions by investors (which
          may generate additional tax credits),  reserves at the property level,
          syndication of state tax credits or other factors.  Our portion of any
          cash requirements may range from nothing to the full amount. Should we
          need to make additional loans to the partnerships,  they would need to
          be  assessed  for  collectibility  and  the  impact  on the  potential
          impairment of existing  revenue bonds.  Given  existing  loan-to-value
          ratios and the  variability of the  likelihood of funding,  we can not
          yet determine  whether we will be required to fund any such loans.  At
          present,  we do not  anticipate  that any such loans  would  require a
          charge to expense.

     o    Potential  impact on revenue  bonds - Our current  estimate,  based on
          available information provided by the developer, is that expected cash
          flows from the  underlying  properties  are sufficient to provide debt
          service.   As  a   result,   we  do  not   believe   that   there   is
          other-than-temporary impairment of any of the affected bonds.

     o    Potential  cost to provide  guaranteed  yields - As noted in the table
          below, 11 of the parternships in question are part of equity funds for
          which we provide yield guarantees.  As construction  delays are likely
          to  reduce  the  expected   yields  of  the   properties   themselves,
          performance  of the  funds is  likely  to be  impacted  as  well.  The
          guarantees,   however,   provide  for  expected  yields  on  pools  of
          properties, some of which are performing above expected levels and the
          funds  themselves  often provide for  adjustors  that may mitigate the
          negative impact that would arise from the construction delays over the
          guarantee  period.  Our  current  estimate  given these  factors,  and
          assuming that the property level  partnerships  meet their obligations
          under existing partnership agreements, is that no exposure under these
          guarantees is probable at this time.

As part of the resolution of this situation,  affiliates of ours have taken over
general partner interests in the partnerships for which an RCC sponsored fund is
an equity partner, all but two of which give our affiliates  operational control
of the partnerships. We will be consolidating those partnerships effective April
2005.

The partnerships in question are summarized as follows:

<TABLE>
<CAPTION>


                                                                                                    (In thousands)
                                   CharterMac         RCC                                       Loan
                                    Holds or       Sponsored                     Third        Amounts        Fair Value of
                                   Will Hold        Fund is    Included in      Parties      Upon Full       Revenue Bonds
                                    Revenue         Equity      Guaranteed      Provided        Draw         Oustanding at
                      Number          Bond          Partner       Funds          Equity         Down         March 31, 2005
                     --------      ----------      ---------   -----------      --------     ----------      --------------
<S>                     <C>            <C>            <C>          <C>             <C>       <C>             <C>
PRS Partnerships
Construction             6              6              4            3               2        $   69,570      $   55,879
Rehab                    1              1              1            1              --            91,400          88,232
Lease Up                 8              7              4            2               4            19,300          16,986
Stabilized               2              2             --           --               2            18,835          18,816
                     ------------------------------------------------------------------------------------------------------
Subtotal PRS Deals      17             16              9            6               8           199,105         179,913

CRG Partnerships
Construction             2              2              2           --              --            17,680              --
Rehab                    3              3              3            3              --             8,300           8,018
Lease Up                 3              3              3            2              --            71,650          69,951
Stabilized              --             --             --           --              --                --              --
                     ------------------------------------------------------------------------------------------------------
Subtotal CRG Deals       8              8              8            5              --            97,630          77,969
                     ------------------------------------------------------------------------------------------------------

Total                   25             24             17           11               8         $ 296,735       $ 257,882
                     ======================================================================================================


</TABLE>

                                       17
<PAGE>



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

Forward-Looking Statements
--------------------------

Certain   statements  made  in  this  report  may  constitute   "forward-looking
statements"  within the meaning of Section 27A of the Securities Act of 1933, as
amended,  and Section 21E of the  Securities  Exchange Act of 1934,  as amended.
These  forward-looking  statements  are not  historical  facts,  but  rather our
beliefs and expectations and are based on our current  expectations,  estimates,
projections,  beliefs and assumptions about our Company and industry. Words such
as  "anticipates,"   "expects,"   "intends,"   "plans,"   "believes,"   "seeks,"
"estimates"  and similar  expressions  are intended to identify  forward-looking
statements.  These  statements are not guarantees of future  performance and are
subject to risks,  uncertainties and other factors, some of which are beyond our
control,  are  difficult  to predict  and could cause  actual  results to differ
materially from those expressed or forecasted in the forward-looking statements.
Some of these risks include, among other things:

o    adverse changes in the real estate markets  including,  among other things,
     competition with other companies;
o    interest rate  fluctuations;
o    general economic and business  conditions,  which will, among other things,
     affect the availability and credit worthiness of prospective tenants, lease
     rents and the terms and  availability of financing for properties  financed
     by revenue bonds owned by us;
o    risk of real estate development and acquisition;
o    environment/safety requirements;
o    changes in applicable laws and regulations;
o    our  tax  treatment,  the tax  treatment  of our  subsidiaries  and the tax
     treatment of our  investments;  and
o    risk of default associated with the revenue bonds and other securities held
     by us or our subsidiaries.

These  risks  are  more  fully  described  in our Form  10-K for the year  ended
December  31,  2004.  We  caution  you not to  place  undue  reliance  on  these
forward-looking  statements,  which reflect our view only as of the date of this
report.

Factors Affecting Comparability
-------------------------------

Due to our adoption of FIN 46(R) as of March 31, 2004, we now  consolidate  more
than 90 VIEs  (predominantly  investment  funds  we  sponsor)  in our  financial
statements.  The  operating  results for the three  months ended March 31, 2005,
include those of these  entities,  as well as the  elimination  of  transactions
between the entities and our  subsidiaries.  The operating results for the three
months ended March 31, 2004, do not include comparable  operations as we adopted
this accounting standard as of the end of that period.

In addition,  we acquired  CCLP in March 2005.  Operating  results  prior to the
acquisition date include interest income on a loan made in July 2004.  Following
the acquisition,  operating results of CCLP are included in our Mortgage Banking
segment.

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

The  following is a summary of our  operations  for the three months ended March
31, 2005 and 2004:

<TABLE>
<CAPTION>

                                              % of                   % of
      (In thousands)            2005        Revenues    2004       Revenues   % Change
---------------------------    -------      --------   -------     --------   --------
<S>                            <C>           <C>       <C>           <C>       <C>
Revenues                       $58,457       100.0%    $46,313       100.0%     26.2%
Income before income taxes     $ 6,420        11.0%    $ 4,029         8.7%     59.3%
Net income                     $14,785        25.3%    $ 6,418        13.9%    130.4%

</TABLE>

Compared  to 2004,  the  first  quarter  of 2005  benefited  from the  continued
expansion of our Portfolio  Investing segment,  expansion of the Fund Management
segment  and the  acquisition  of  CCLP  in the  Mortgage  Banking  segment.  In
addition,  revenues in 2005 include $4.9 million generated by VIEs that were not
consolidated  in 2004.  Offsetting the revenue gains is the  elimination of $7.6
million of revenues earned by our subsidiaries in transactions with VIEs we have
consolidated  beginning  April 1, 2004.  Although the amounts are  eliminated in
consolidation,  the expenses  recognized  by the VIEs in  connection  with these
transactions  are absorbed  entirely by the partners of the VIEs;  as such,  the
elimination in consolidation has no impact on our net income.

The revenue  gains and the  relatively  smaller  increase in expenses  led to an
increase in income before taxes,  while a significantly  higher tax benefit also
contributed to the increase in net income.



                                       18
<PAGE>



REVENUES

Our revenues were as follows:

<TABLE>
<CAPTION>

                                             For the Three Months Ended March 31,
                                             -------------------------------------
       (In thousands)                          2005          2004        % Change
------------------------------               --------      --------      ---------
<S>                                          <C>           <C>              <C>
Revenue bond interest income                 $36,456       $31,851          14.5%

Fee income
   Mortgage banking                            4,081         3,116          31.0
   Fund sponsorship                            3,311         6,780         (51.2)
   Credit enhancement                          2,439         1,897          28.6
                                             -------       -------       -------
Total fee income                               9,831        11,793         (16.6)

Other revenues
   Capri loan interest                         1,781            --            --
   Other interest                              1,957           584         235.1
   Construction service fee                      870           139         525.9
   Expense reimbursement                       1,342         1,254           7.0
   Other                                       1,318           692          90.5
                                             -------       -------       -------
Total other revenues                           7,268         2,669         172.3

Revenues of consolidated VIEs                  4,902            --            --
                                             -------       -------       -------

   Total revenues                            $58,457       $46,313          26.2%
                                             =======       =======       =======

</TABLE>

The overall  growth in our revenues is due to the continued  expansion of all of
our businesses,  including the acquisition of CCLP in the first quarter of 2005.
Results in 2005 also include  revenues of VIEs that were not consolidated in the
first quarter of 2004,  offset by the elimination in  consolidation  of revenues
associated  with  VIEs  that are now  consolidated  in our  condensed  financial
statements. In the first quarter of 2005, approximately $259,000 of revenue bond
interest  income,  $7.0 million of fund  sponsorship  fees and $347,000 of other
revenues was eliminated. See also RESULTS BY SEGMENT below.

The Capri loan interest  relates to the loans made in July 2004, a large portion
of which has since been  converted  upon the  acquisition of CCLP (see note 2 to
the condensed  consolidated  financial  statements).  The increase in "other" is
primarily due to exit fees  received  within the Mortgage  Banking  business and
construction  service  fees  and  administrative  fees  in the  Fund  Management
segment.

EXPENSES

Our expenses were as follows:

<TABLE>
<CAPTION>

                                                  For the Three Months Ended March 31,
                                                  -----------------------------------
           (In thousands)                           2005          2004       % Change
--------------------------------------            --------      --------     --------
<S>                                                <C>           <C>            <C>
Interest expense                                   $10,812       $ 6,586        64.2%
Interest expense - preferred shares of
   subsidiary                                        4,724         4,724          --
Salaries and benefits                               16,653        13,882        20.0
General and administrative                           9,591         6,349        51.1
Depreciation and amortization                        7,696         6,893        11.6
Change in FV of ineffective derivatives                 --         3,387          --
                                                   -------       -------      ------
   Subtotal                                         49,476        41,821        18.3

Interest expense of consolidated VIEs                6,889            --          --
Other expenses of consolidated VIEs                 11,294            --          --
                                                   -------       -------      ------

Total expenses                                     $67,659       $41,821        61.8%
                                                   =======       =======      ======

</TABLE>

The  increase in interest  expense  reflects  the higher  amount of debt to fund
investments  in revenue  bonds,  our loan to Capri and LIHTC equity  investments
inherent in the Fund  Management  business  in 2004.  In  addition,  our average



                                       19
<PAGE>

borrowing  rate  increased as a result of  increases in Bond Market  Association
("BMA") and LIBOR rates in 2004 and 2005,  as well as the impact of new interest
rate swap  transactions  that went into effect in the first quarter of 2005. Our
average borrowing rate increased to 2.8% in the 2005 quarter as compared to 2.3%
in the 2004 period.

The  increases  in salaries and  benefits  expense  relates to the growth of our
component  businesses as well as the acquisition of CCLP in the first quarter of
2005, which doubled the size of our Mortgage Banking business.

The increase in general and administrative expenses is also due to the expansion
of our  businesses  and the  acquisition  of CCLP,  particularly  with regard to
increased occupancy needs and professional fees.

Depreciation and amortization expenses were higher in the 2005 period, primarily
due to higher  amortization  of mortgage  servicing  rights  following  the CCLP
acquisition.

We did not record the expenses of consolidated  VIEs prior to April 1, 2004. The
expenses are not  controlled  by us, nor do they  represent any cash or non-cash
charges to be absorbed by us. The expenses of the VIEs are absorbed  entirely by
the partners of the VIEs.

OTHER ITEMS

<TABLE>
<CAPTION>

                                              For the Three Months Ended March 31,
                                              -----------------------------------
           (In thousands)                       2005          2004       % Change
--------------------------------------        --------      --------     --------
<S>                                           <C>           <C>            <C>
Derivative instrument ineffectiveness         $     --      $ (3,387)          --%
(Loss) gain on repayment of revenue bonds     $     (9)     $    260       (103.5)%
Gain on sale of loans                         $  1,704      $  1,745         (2.3)%
Equity in earnings of investments             $    524      $    555         (5.6)%
Income allocated to preferred
   shareholders of subsidiary                 $ (1,556)     $     --           --%
Income allocated to Special Common Units
   of subsidiary                              $ (6,065)     $ (2,918)       107.8%
Income allocated to minority interests        $     --      $   (105)          --%
Loss allocated to partners of
   consolidated VIEs                          $ 70,963      $     --           --%

</TABLE>

The change in fair value of derivatives  represents the portion of the change in
the fair value of swap  agreements  determined  to be  ineffective,  as measured
using the hypothetical swap method. The amount reversed in the second quarter of
2004 and all swaps have been effective in the current year period.

Gains and losses  related to revenue  bonds and loans  fluctuate  in relation to
relative  activity  levels  in the  Portfolio  Investing  and  Mortgage  Banking
businesses. See RESULTS BY SEGMENT below.

Equity in earnings of  investments  includes  dividends  from our  investment in
ARCap  Investors,  LLC, offset in 2005 by losses from tax advantaged  investment
vehicles similar to those we sponsor.

The income  allocated to preferred  shareholders  relates to shares we issued in
2004 that differ from  previously  issued shares in that they are not subject to
mandatory  redemption;  as such,  the  distributions  are  classified as expense
outside of operating earnings.  Total income allocated to preferred shareholders
for the three months ended March 31, 2005,  including the portion  classified as
interest  expense,  increased  as compared to the three  months  ended March 31,
2004, due to the additional preferred offering consummated in May 2004.

The income  allocation to Special  Common Units of a subsidiary  represents  the
proportionate  share of income  attributable to holders' subsidiary equity as if
they were all  converted  to common  shares.  There was no income  allocated  to
minority  interests in the 2005 period as we repurchased all remaining shares of
CMC in the period.

The loss allocation to partners of VIEs represents the full operating  losses of
consolidated VIEs for the current period, none of which we have absorbed.

Income Taxes
------------

A large majority of our pre-tax  income is derived from our Portfolio  Investing
businesses,  which are structured as partnership  entities; as such, income from
those  investments  is not subject to taxes.  Conversely,  our  businesses  that
generate taxable income are corporations  operating with financial losses due to
their  absorption of most company  costs and expenses as well as  tax-deductible



                                       20
<PAGE>



distributions on their subsidiary equity.

We provide for income taxes for these corporate  subsidiaries in accordance with
SFAS No. 109,  ACCOUNTING  FOR INCOME TAXES ("SFAS No. 109") which  requires the
recognition of deferred tax assets and  liabilities  for the expected future tax
consequences of temporary  differences  between the financial statement carrying
amounts and the tax bases of assets and liabilities.  The tax benefit  disclosed
relates to the book losses of those businesses. As the proportion of our pre-tax
income  contributed  by the  businesses  generating  taxable  income  and losses
changes,  the resulting tax benefit or provision may appear incongruous with our
consolidated income before income taxes.

The effective tax rate on a consolidated  basis for the three months ended March
31, 2005 and 2004 was (130.3)% and (59.3)%, respectively. The effective rate for
our  corporate  subsidiaries  that were subject to taxes was 55.2% and 52.8% for
the three months ended March 31, 2005 and 2004, respectively.

Results by Segment
------------------

PORTFOLIO INVESTING

The table below shows  selected  information  regarding our Portfolio  Investing
activities:

<TABLE>
<CAPTION>

                                                      For the Three Months Ended March 31,
                                                      -----------------------------------
               (In thousands)                               2005              2004
-------------------------------------------------        ----------        ----------
<S>                                                      <C>               <C>
Revenue bond acquisitions and fundings                   $  111,751        $   91,065
Weighted average permanent interest rate of bonds
 acquired                                                    6.51 %              6.60%
Revenue bonds repaid                                     $      459        $   23,635
Average portfolio balance                                $2,191,793        $1,860,481
Weighted average yield of portfolio                          6.65 %              6.85%

Revenue bond interest income (1)                         $   36,716        $   31,851
Other revenues (1)                                            3,284             1,692
                                                         ----------        ----------
                                                         $   40,000        $   33,543
                                                         ==========        ==========

Interest expense and securitizations fees (1)            $   10,290        $   10,791
Gain on repayments of revenue bonds                      $        9        $      260

</TABLE>

(1) Prior to intercompany eliminations.

The increase in revenue bond  interest  income is primarily due to the increased
investment  base  resulting  from new bonds funded during later quarters of 2004
and during 2005, although the rate of investment reflects the challenging market
conditions  experienced  since 2004 whereby some potential  investments  did not
meet our underwriting standards.

While the decline in interest  rates has gradually  lowered the average yield of
our portfolio, from a profit perspective,  the low interest rate environment has
been favorable for us. Although  increasing lately, the BMA rate, the short-term
tax-exempt index,  continues to be low,  averaging 1.86% and 0.95% for the three
months ended March 31, 2005 and 2004, respectively. Our weighted average cost of
debt associated with these investments was approximately 2.39% and 1.90% for the
same respective periods,  taking into effect our current hedging. We continue to
recognize  healthy  spreads between our cost of borrowing and the interest rates
on our revenue bonds.  The interest rates on our tax-exempt first mortgage bonds
for the three  months  ended March 31, 2005,  had a weighted  average  permanent
coupon rate of 6.9% and our entire  tax-exempt first mortgage bond portfolio had
a weighted  average  coupon  rate of 6.7% for the three  months  ended March 31,
2005.

Other revenues in this segment is  predominantly  interest income on investments
other  than  revenue  bonds  and   intercompany   royalty  fees   eliminated  in
consolidation.  The  increase  for the three  months  ended March 31,  2005,  as
compared to the three months ended March 31, 2004,  is due largely to Capri loan
interest (see Note 4 to the condensed consolidated financial statements).



                                       21
<PAGE>

FUND MANAGEMENT

The  table  below  shows  selected  information  regarding  our Fund  Management
activities:

<TABLE>
<CAPTION>

                                        For the Three Months Ended March 31,
                                        -----------------------------------
         (In thousands)                   2005         2004        % Change
-----------------------------------     --------     --------      --------
<S>                                     <C>          <C>            <C>
Equity raised                           $ 15,212     $ 28,610       (46.8)%
Equity invested by investment funds     $123,942     $ 77,627        59.7%

Fund sponsorship fees (1)               $ 11,538     $  7,982        44.6%
Credit enhancement fees                    2,439        1,897        28.6
Other revenues (1)                         3,738        1,762       100.9
                                        --------     --------      ------
   Total                                $ 17,715     $ 11,641        50.5 %
                                        ========     ========      ======

</TABLE>

(1) Prior to intercompany eliminations.

Our  Fund  Management  activities  generate  origination  and  acquisition  fees
associated with sponsoring  tax-credit equity investment funds and for assisting
the funds in acquiring assets, which we recognize when the equity is invested by
the investment  fund. We also receive asset  management fees for the services we
perform  for the funds  once they are  operating,  which we  recognize  over the
service periods.  As many of our revenues are recognized over time following the
sponsorship of a new fund, many of the 2005 increases relate to the funds closed
throughout 2004.

We earn  Organization  and Offering  ("O&O") service and partnership  management
fees based upon the level of equity we raise for tax-credit  equity funds.  Fees
earned for O&O  services  decreased  approximately  47% to $152,000  compared to
$286,000 in the 2004 quarter due to the decrease in equity  raised.  Fees earned
for partnership management services are amortized over a five-year period. These
fees increased  approximately  400% to $838,000 compared to $167,000 compared to
the same  period in 2004.  This  increase  is  primarily  the  result of ongoing
revenues for fund sponsorships completed after the first quarter of 2004.

We earn property acquisition fees and acquisition  allowance fees based upon the
level of fund equity invested.  Fees earned for property  acquisition and equity
origination   services  associated  with  tax  credit  equity  fund  sponsorship
increased to approximately $5.0 million in 2005, representing an approximate 45%
increase  compared to the prior year results.  While these fees are earned based
on investment  activity,  the increase fell short of the percentage  increase in
investments due to the rate of fees realized as a result of the lower proportion
of proprietary  (single-investor) funds in the total mix of fund equity invested
in 2005 as compared to 2004.

Also  during  2005,  RCC acted as  advisor  for  $116.9  million  of  investment
originations  by CharterMac  entities and others,  compared to $122.7 million of
such  originations  for the three  months  ended March 31,  2004.  We  recognize
acquisition fees in this segment for such services,  which approximated the fees
recognized for the three months ended March 31, 2004.

Partnership  and asset  management  fees increased to $4.3 million for the three
months ended March 31, 2005,  representing an increase of approximately 48% over
the 2004 quarter,  attributable  to the higher level of assets under  management
and the improvement of the cash position of certain investment funds allowing us
to collect  management fees in 2005 which we did not previously  recognize until
collectibility was determined.

The increase in credit  enhancement  fees relates to  acceleration of the credit
enhancement business. The increase for the three months ended March 31, 2005, as
compared to the 2004 period is due to additional credit enhancement transactions
completed  over the  course  of 2004,  the fees for which  are  recognized  over
periods of up to 20 years.



                                       22
<PAGE>



MORTGAGE BANKING

The table  below shows  selected  information  regarding  our  Mortgage  Banking
activities:

<TABLE>
<CAPTION>

                                     For the Three Months Ended March 31,
                                   ----------------------------------------
       (In thousands)                 2005           2004         % Change
------------------------------     ----------     ----------      ---------
<S>                                <C>            <C>               <C>
Originations                       $  123,461     $  132,988         (7.2)%
Mortgage portfolio at March 31     $9,339,038     $4,099,998        127.8%

Mortgage servicing fees            $    3,323     $    2,315         43.6%
Mortgage origination fees                 757            801         (5.5)
Other revenues                          1,790            764        134.3
                                   ----------     ----------        -----
                                   $    5,870     $    3,880         51.3%
                                   ==========     ==========        =====

</TABLE>

The increase in the servicing  portfolio  and servicing  fees is a result of the
CCLP acquisition.  Excluding the impact of the acquisition, servicing fee income
in 2005 increased approximately 1.0% over the first quarter of 2004.

The lower volume of originations in 2005 resulted from a significant  decline in
Fannie Mae and conduit originations due to heightened competition.  This decline
was  partially  offset  by a higher  level of  assumption  lending  for which we
receive  assumption  fees rather than  origination  fees.  Originations  for the
three-months ended March 31 are broken down as follows:

<TABLE>
<CAPTION>

 (In thousands)      2005       % of total    2004       % of total
----------------   --------     ----------  --------     ----------
<S>                <C>            <C>       <C>            <C>
Fannie Mae         $ 42,268        34.2%    $ 78,011        58.6%
Freddie Mac           9,265         7.5        8,500         6.4
Conduit - Bank       12,814        47.9       21,504        16.2
Assumptions          59,114        10.4       24,973        18.8
                   --------       -----     --------       -----

Total              $123,461       100.0%    $132,988       100.0%
                   ========       =====     ========       =====

</TABLE>

Other revenues in this segment pertains to interest earned on mortgages prior to
their  sale  date,  exit  fees for early  repayments  and fees  earned  for loan
assumptions.  The  increase in the 2005 period is primarily a result of the CCLP
acquisition.

VIES

The results of VIEs reflected in our financial  statements are those of entities
we are considered to control  according to the definitions of FIN 46(R),  but in
which we have no equity  interest.  Our Fund Management  segment earns fees from
the entities,  however,  and our Portfolio  Investing business earns interest on
several  revenue bonds for which VIEs are the  obligors.  The VIEs are primarily
tax-credit equity investment funds we sponsor and manage.

The results we reported in 2005 reflect three months of operations  for the VIEs
we  consolidate  while the quarter  ended March 31,  2004,  does not include any
comparable  operating results as we consolidated these entities as of the end of
that period.

As third party  investors  hold all the equity  partnership  interests  in these
entities,  we allocate all results of operations to those partners. As a result,
these VIEs have no impact on our net income.

Inflation
---------

Inflation  did not  have a  material  effect  on our  results  for  the  periods
presented.

Liquidity and Capital Resources
-------------------------------

We fund  our  ongoing  business  (including  investments)  primarily  with  cash
provided by operations, securitization of investments and revolving or warehouse
credit  facilities.  Our primary sources of capital to meet long-term  liquidity
needs (including  acquisitions)  are debt and various types of equity offerings,
including equity of our subsidiaries. We believe that our financing capacity and
cash flow from current operations are adequate to meet our current and projected
liquidity  requirements.  Nonetheless,  as business needs warrant,  we may issue
other types of debt or equity in the future.



                                       23
<PAGE>



DEBT AND SECURITIZATIONS
------------------------

Short-term liquidity provided by operations comes primarily from interest income
from  revenue  bonds and  promissory  notes in excess of the  related  financing
costs,  mortgage  origination and servicing  fees, and fund management  fees. We
typically generate funds for investment  purposes from  corresponding  financing
activities.

We have the following debt and  securitization  facilities to provide short-term
and long-term liquidity:

o    $100.0  million,  used for  mortgage  banking  needs,  which  is  renewable
     annually;
o    $90.0  million,  used to acquire  equity  interests  in property  ownership
     entities prior to the inclusion of these equity  interests into investments
     funds,  which matures on October 28, 2005, with a one year extension at our
     option;
o    $91.0 million,  used to provide the interim loan to Capri, which matures in
     July 2005;
o    $40.0 million,  established in connection with the CMC  acquisition,  which
     expires December 31, 2006;
o    $650.0 million in MBIA credit enhancement  through 2011, under which we can
     complete up to $425.0 million of floating rate  securitizations  and $225.0
     million of auction rate  securitization;  and
o    Securitization  through the  Merrill  Lynch  P-FLOATs/RITESSM  program of a
     specified  percentage  of the fair  value of  revenue  bonds not  otherwise
     securitized, credit enhanced by either Merrill Lynch or IXIS.

As of March 31, 2005, we had  approximately  $262.6 million  available to borrow
under these debt and securitization  facilities without exceeding limits imposed
by debt covenants and our trust agreement.

Liquidity Requirements after March 31, 2005
-------------------------------------------

During May 2005,  distributions of approximately $23.7 million ($0.41 per share)
will be paid to holders of common and  Convertible  CRA Shares and $8.6  million
paid to SCU holders, all of which were declared in March 2005.

Also during May 2005, we expect to pay the  remainder of the purchase  price for
CCLP,  50% of which will be paid in cash.  The maximum amount to be paid in cash
is $7.5 million.

Management is not aware of any trends or events,  commitments or  uncertainties,
which  have not  otherwise  been  disclosed  that  will or are  likely to impact
liquidity in a material way.

Summary of Cash Flows
---------------------

The net  increase in cash and cash  equivalents  during 2005 was higher than the
increase in 2004,  primarily due to increased  operating and financing  inflows,
which offset the higher level of financing activity in 2005 as compared to 2004.

Operating  cash  flows  were  higher  in the 2005  period  by a margin  of $29.9
million.  This increase  resulted  from a higher level of earnings  exclusive of
non-cash   expenses  and  the  repayment  of  advances  we  had  made  to  AMAC.
Additionally,  the  timing of  receipts  and  payments  in  operating  asset and
liability accounts contributed to this increase.

Investing  outflows  increased  by $69.9  million in 2005 as compared to 2004. A
higher  level of revenue bond  acquisition  and funding  activity,  coupled with
lower  repayment  activity,  and a net outflow from  mortgage  originations  was
partially  offset by a net decrease in our funds invested in partnerships in the
current  year  period.  The funds paid to acquire the portion of CMC that we had
not owned  previously  was  offset by a net cash  inflow at the time of the CCLP
acquisition,  as the majority of the CCLP purchase price was paid in the form of
a loan in the third quarter of 2004.

Financing  inflows in the 2005 period were higher than in 2004 by $42.5 million.
The  primary   reason  for  the  higher   inflows  in  2005  was  the  level  of
securitization  borrowings, a portion of which was the remarketing of borrowings
under the fixed rate securitization that terminated in the current year quarter.

Commitments, Contingencies and Off Balance Sheet Arrangements
-------------------------------------------------------------

Note 13 to the condensed consolidated financial statements contains a summary of
the Company's guarantees and off-balance sheet arrangements.

Subsequent Events
-----------------

See Note 14 to the condensed consolidated financial statements regarding actions
taken in May 2005 in  response  to the  financial  difficulties  experienced  by
sponsors of certain properties  underlying revenue bonds and investment funds we
sponsor as well as the foreclosure upon certain other underlying properties.



                                       24
<PAGE>

The  following  table  reflects our maximum  exposure and carrying  amount as of
March 31, 2005, for guarantees we and our subsidiaries have entered into:

<TABLE>
<CAPTION>

                                                 Maximum        Carrying
              (In thousands)                     Exposure        Amount
-------------------------------------------     ----------     ----------
<S>                <C>                          <C>            <C>
Payment guarantees (1)                          $   45,471     $       --
Completion guarantees (1)                           37,773             --
Operating deficit guarantees (1)                     1,629             --
Recapture guarantees (1)                            66,366             --
Replacement reserve (1)                              1,792             --
Mortgage pool credit enhancement (2)                19,000             --
LIHTC guarantees (2)                               459,971         14,885
Mortgage banking loss sharing agreement (3)        940,356          9,455
                                                ----------     ----------

                                                $1,572,358     $   24,340
                                                ==========     ==========

</TABLE>

(1)  These guarantees  generally relate to business  requirements for developers
     to obtain  construction  financing.  As part of our role as co-developer of
     certain properties, we issue these guarantees in order to secure properties
     as assets for the funds we manage. To date, we have had minimal exposure to
     losses  under  these  guarantees  and  anticipate  no  material   liquidity
     requirements in satisfaction of any guarantee issued.

(2)  We see these  guarantees  as  opportunities  to expand our Fund  Management
     business by offering broad capital solutions to customers. To date, we have
     had minimal  exposure to losses under these  guarantees  and  anticipate no
     material  liquidity  requirements in satisfaction of any guarantee  issued.
     The  carrying  values  disclosed  above  relate to the fees we earn for the
     guarantees, which we recognize as the fair value of the guarantee.

(3)  The loss  sharing  agreement  with  Fannie Mae is a normal  part of the DUS
     lender  program and  affords a higher  level of fees than we earn for other
     comparable  funding  sources.  The carrying  value  disclosed  above is our
     estimate of potential  exposure under the guarantees,  although any funding
     requirements for such exposure is based on the contractual  requirements of
     the  underlying  loans we sell to Fannie  Mae,  which vary as to amount and
     duration, up to a maximum of 30 years.

The maximum  exposure  amount is not indicative of our expected losses under the
guarantees.

CONTRACTUAL OBLIGATIONS

The  following  table  provides our  commitments  as of March 31, 2005,  to make
future payments under our debt agreements and other contractual obligations:

<TABLE>
<CAPTION>

                                                                  Payments due by period
                                           ----------------------------------------------------------------------
                                                           Less than                                   More than
             (In thousands)                   Total         1 year       1-3 years     3-5 years       5 years
----------------------------------------   -----------    -----------    ----------    ----------    ------------
<S>           <C>                          <C>            <C>            <C>           <C>           <C>
Notes payable (1)                          $   203,146    $   184,744    $    5,452    $   12,950    $         --
Notes payable of consolidated VIEs (2)         480,258        140,578       175,470        23,846         140,364
Operating lease obligations                     70,305          4,431        11,642        12,136          42,096
Unfunded loan commitments                      200,070        133,515        66,555            --              --
Financing arrangements (1)                   1,203,506      1,203,506            --            --              --
Preferred shares of subsidiary (subject
  to mandatory repurchase)                     273,500             --            --            --         273,500
                                           -----------    -----------    ----------    ----------    ------------

   Total                                   $ 2,430,785    $ 1,666,774    $  259,119    $   48,932    $    455,960
                                           ===========    ===========    ==========    ==========    ============

</TABLE>

(1)  The amounts reflect the current  expiration,  reset or renewal date of each
     facility or security certificate.  Management has the ability and intent to
     renew, refinance or remarket the borrowings beyond their current due dates.

(2)  Of the notes payable of consolidated  VIEs, $407.1 million is guaranteed by
     certain  equity   partners  of  the  investment   funds.   Per  partnership
     agreements, the equity partners are also obligated to pay the principal and
     interest  on  the  notes.  The  remaining   balance  of  $73.2  million  is
     collateralized with the underlying properties of the consolidated operating
     partnerships. All of this debt is non-recourse to us.



                                       25
<PAGE>



ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We invest in certain  financial  instruments,  primarily revenue bonds and other
bond  related  investments  that are  subject to various  forms of market  risk,
including  interest  rate risk.  We seek to prudently  and actively  manage such
risks to earn  sufficient  compensation to justify the undertaking of such risks
and to  maintain  capital  levels  which  are  commensurate  with  the  risks we
undertake.

The  assumptions  related to the  following  discussion  of market risk  involve
judgments   involving  future  economic  market  conditions,   future  corporate
decisions and other interrelating  factors, many of which are beyond our control
and all of which are difficult or impossible to predict with accuracy.  Although
we believe that the assumptions  underlying the forward-looking  information are
reasonable, any of the assumptions could be inaccurate and, therefore, there can
be no assurance that the forward-looking  information included herein will prove
to be accurate. Due to the significant uncertainties inherent in forward-looking
information,  the  inclusion of such  information  should not be regarded as our
representation that our objectives and plans would be achieved.

INTEREST RATE RISK
------------------

The nature of our  investments  and the  instruments  used to raise  capital for
their acquisition expose us to income and expense volatility due to fluctuations
in market  interest rates.  Market  interest rates are highly  sensitive to many
factors,  including governmental  policies,  domestic and international economic
and political  considerations and other factors beyond our control. Our exposure
to interest rates is twofold:

o    the potential increase in interest expense on our variable rate debt; and
o    the impact of interest rate on the value of our assets.

IMPACT ON EARNINGS

Our  investments in revenue bonds generally bear interest at fixed rates, or pay
interest according to the cash flows of the underlying properties,  which do not
fluctuate with changes in market interest rates.

In contrast,  payments required under our floating rate securitization  programs
vary based on market  interest  rates based on the BMA municipal  swap index and
are re-set  weekly or every 35 days.  In addition,  we have  floating  rate debt
related  to our  acquisition  financing  and  our  warehouse  facilities.  Other
long-term sources of capital,  such as the preferred shares of our Equity Issuer
subsidiary,  carry a fixed  dividend  rate and,  as such,  are not  impacted  by
changes in market interest rates.

Excluding $524.0 million of debt hedged via interest rate swap  agreements,  the
full  amount of our  liabilities  labeled as  Financing  Arrangements  and Notes
Payable  are  variable  rate  debts.  We  estimate  that an  increase of 1.0% in
interest  rates  would  decrease  our annual net  income by  approximately  $8.8
million.

We manage this risk through the use of interest  rate swaps,  interest rate caps
and forward  bond  origination  commitments,  as  described  in the notes to our
financial  statements.  In  addition,  we manage our  exposure by  striving  for
diversification  in our businesses to include those not  susceptible to interest
rate changes and by managing our leverage.

IMPACT ON VALUATION OF ASSETS

Changes in market  interest  rates would also impact the estimated fair value of
our portfolio of revenue bonds. We estimate the fair value for each revenue bond
as the  present  value of its  expected  cash flows,  using a discount  rate for
comparable  tax-exempt  investments.  Therefore,  as market  interest  rates for
tax-exempt  investments increase,  the estimated fair value of our revenue bonds
will  generally  decline,  and a decline in interest  rates would be expected to
result in an increase in their estimated fair values. For example,  we estimate,
using the same  methodology  used to estimate  the  portfolio  fair market value
under SFAS 115,  that a 1% increase in market rates for  tax-exempt  investments
would  decrease the estimated  fair value of our portfolio of revenue bonds from
its March 31, 2005,  value of approximately  $2.2 billion to approximately  $2.1
billion.  A 1% decline in interest  rates would  increase the value of the March
31, 2005, portfolio to approximately $2.3 billion. Changes in the estimated fair
value of the revenue  bonds do not impact our reported net income,  earnings per
share,  distributions  or cash flows,  but are reported as  components  of other
accumulated  comprehensive income and affect reported  shareholders' equity, and
may affect our borrowing  capability to the extent that collateral  requirements
are sometimes based on our asset values.

ITEM 4. CONTROLS AND PROCEDURES

(a)  EVALUATION OF DISCLOSURE  CONTROLS AND  PROCEDURES.  The Company  maintains
     disclosure  controls  and  procedures  that are  designed  to  ensure  that
     information  required to be disclosed in the reports that the Company files
     or submits under the  Securities  and Exchange Act is recorded,  processed,
     summarized,  and reported  within the time  periods  specified in the SEC's
     rules and forms,  and that such information is accumulated and communicated
     to the  Company's  management,  including its Chief  Executive  Officer and



                                       26
<PAGE>



     Chief  Financial  Officer,  as  appropriate,   to  allow  timely  decisions
     regarding required disclosures.

     As of the end of the period covered by this Quarterly  Report on Form 10-Q,
     the Company  carried out an evaluation,  under the supervision and with the
     participation  of the Company's  management,  including the Chief Executive
     Officer and Chief Financial Officer, of the effectiveness of the design and
     operation  of  our  disclosure  controls  and  procedures  pursuant  to the
     Securities and Exchange Act Rule 13a-15.  Based upon this  evaluation as of
     March 31, 2005, the Chief  Executive  Officer and Chief  Financial  Officer
     conclude  that the Company's  disclosure  controls and  procedures  are not
     effective  due to the  unremediated  material  weaknesses  in the Company's
     internal control over financial  reporting  identified during the Company's
     evaluation  pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 as of
     the year ended  December 31, 2004. To remediate  these control  weaknesses,
     the Company  performed  additional  analysis and performed other procedures
     (detailed  in item 4b below) in order to prepare  the  unaudited  quarterly
     consolidated  financial  statements in accordance  with generally  accepted
     accounting  principles  in  the  United  States  of  America.  Accordingly,
     management believes that the consolidated  financial statements included in
     this  Quarterly  Report  on  Form  10-Q  fairly  present,  in all  material
     respects, our financial condition, results of operations and cash flows for
     the periods presented.

(b)  INTERNAL  CONTROL  OVER  FINANCIAL  REPORTING.  To  remediate  the material
     weaknesses in internal controls identified during the Company's  evaluation
     pursuant  to Section 404 of the  Sarbanes-Oxley  Act of 2002 as of the year
     ended  December 31, 2004,  during the first quarter of 2005,  we have:

     (i)  taken  steps to  remediate  the errors in our tax  accounting  through
          increased  use of  third-party  tax  service  providers  for the  more
          complex areas of our tax accounting and increased  formality and rigor
          of controls and procedures over accounting for income taxes;
     (ii) strengthened  our due diligence  procedures  in reviewing  acquisition
          candidates  to  ensure  that  any  required   recharacterizations  are
          identified on a timely basis; and
     (iii)strengthened our analytical  procedures with regard to the preparation
          and review of all consolidation eliminations.



                                       27
<PAGE>



                           PART II. OTHER INFORMATION
ITEM 1.  LEGAL PROCEEDINGS

         We are subject to routine  litigation  and  administrative  proceedings
         arising in the ordinary course of business. Management does not believe
         that such matters will have a material  adverse impact on our financial
         position, results of operations or cash flows.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

<TABLE>
<CAPTION>

                                           Purchases of Equity Securities

                                     (a)                (b)                (c)                       (d)

                                                                        Total number
                                                                          of shares
                                    Total                             purchased as part       Maximum number
                                  number of           Average            of publicly       of shares that may yet
                                    shares           price paid      announced plans or    be purchased under the
       Period                     purchased          per share            programs            plans or programs
---------------------            -----------        ------------    --------------------  ------------------------
<S>                                 <C>                <C>                    <C>                <C>
January 1 - 31, 2005                25,645             $23.75                 --
February 1 - 28, 2005                   --                 --                 --
March 1 - 31, 2005                  57,439              23.05                 --
                                  --------            -------            -------

Total                               83,084             $23.40                 --                 1,291,273
                                  ========            =======            =======                ==========

</TABLE>

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES - None

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - None

ITEM 5.  OTHER INFORMATION - None

ITEM 6.  EXHIBITS

     31.1 Chief Executive Officer  certification  pursuant to Section 302 of the
          Sarbanes-Oxley Act of 2002.*

     31.2 Chief Financial Officer  certification  pursuant to Section 302 of the
          Sarbanes-Oxley Act of 2002.*

     32.1 Chief  Executive  Officer and Chief  Financial  Officer  certification
          pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

          *    Filed herewith




                                       28
<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.



                                   CHARTERMAC
                                  (Registrant)



Date:  May 10, 2005            By: /s/ Stuart J. Boesky
                                   --------------------
                                   Stuart J. Boesky
                                   Managing Trustee and Chief Executive Officer



Date:  May 10, 2005            By: /s/ Alan P. Hirmes
                                   ------------------
                                   Alan P. Hirmes
                                   Managing Trustee, Chief Financial Officer and
                                   Chief Operating Officer



<PAGE>



                                                                    Exhibit 31.1



                      CERTIFICATION PURSUANT TO SECTION 302
                        OF THE SARBANES-OXLEY ACT OF 2002



I, Stuart J. Boesky, hereby certify that:

     1.  I have  reviewed  this  quarterly  report on Form  10-Q for the  period
         ending March 31, 2005 of CharterMac;

     2.  Based  on my  knowledge,  this  report  does  not  contain  any  untrue
         statement of a material fact or omit to state a material fact necessary
         in order to make the  statements  made,  in light of the  circumstances
         under which such  statements  were made, not misleading with respect to
         the period covered by this report;

     3.  Based on my knowledge,  the financial  statements,  and other financial
         information  included in this  report,  fairly  present in all material
         respects the financial condition,  results of operations and cash flows
         of the registrant as of, and for, the periods presented in this report;

     4.  The registrant's  other  certifying  officer and I are  responsible for
         establishing  and maintaining  disclosure  controls and  procedures (as
         defined in Exchange Act Rules  13a-15(e)  and  15d-15(e))  and internal
         control  over  financial  reporting  (as defined in  Exchange Act Rules
         13a-15(f) and 15d-15(f)) for the registrant and have:

         a) designed such  disclosure  controls and  procedures,  or caused such
         disclosure   controls  and   procedures   to  be  designed   under  our
         supervision,  to  ensure  the  material  information  relating  to  the
         registrant,  including its consolidated subsidiaries,  is made known to
         us by others within those entities,  particularly  during the period in
         which this report is being prepared;

         b) designed such  internal control over financial reporting,  or caused
         such  internal  control over  financial  reporting to be designed under
         our  supervision,   to  provide  reasonable  assurance  regarding   the
         reliability  of  financial  reporting and the  preparation of financial
         statements for external  purposes in accordance with generally accepted
         accounting principals;

         c) evaluated the effectiveness of the registrant's  disclosure controls
         and procedures and presented in this report our  conclusions  about the
         effectiveness of the disclosure controls and procedures,  as of the end
         of the period covered by this report based on such evaluation; and

         d)  disclosed  in this report any change in the  registrant's  internal
         control over financial  reporting that occurred during the registrant's
         most  recent  fiscal  quarter  that  has  materially  affected,  or  is
         reasonably  likely to  materially  affect,  the  registrant's  internal
         control over financial reporting; and

     5.  The registrant's other certifying  officer and I have disclosed,  based
         on our most  recent  evaluation  of  internal  control  over  financial
         reporting,  to the  registrant's  auditors  and the audit  committee of
         registrant's  board of directors or persons  performing  the equivalent
         functions:

         a) all significant  deficiencies and material  weaknesses in the design
         or operation of internal  control over  financial  reporting  which are
         reasonably  likely to  adversely  affect  the  registrant's  ability to
         record, process, summarize and report financial information; and

         b) any fraud,  whether or not  material,  that  involves  management or
         other  employees  who  have a  significant  role  in  the  registrant's
         internal control over financial reporting.


         Date:  May 10, 2005                        By:  /s/Stuart J. Boesky
                                                         -------------------
                                                         Stuart J. Boesky
                                                         Chief Executive Officer



<PAGE>



                                                                    Exhibit 31.2



                      CERTIFICATION PURSUANT TO SECTION 302
                        OF THE SARBANES-OXLEY ACT OF 2002



I, Alan P. Hirmes, hereby certify that:

     1.  I have  reviewed  this  quarterly  report on Form  10-Q for the  period
         ending March 31, 2005 of CharterMac;

     2.  Based  on my  knowledge,  this  report  does  not  contain  any  untrue
         statement of a material fact or omit to state a material fact necessary
         in order to make the  statements  made,  in light of the  circumstances
         under which such  statements  were made, not misleading with respect to
         the period covered by this report;

     3.  Based on my knowledge,  the financial  statements,  and other financial
         information  included in this  report,  fairly  present in all material
         respects the financial condition,  results of operations and cash flows
         of the registrant as of, and for, the periods presented in this report;

     4.  The  registrant's  other  certifying  officer and I are responsible for
         establishing  and  maintaining  disclosure  controls and procedures (as
         defined in Exchange  Act Rules  13a-15(e) and  15d-15(e))  and internal
         control  over  financial  reporting  (as  defined in Exchange Act Rules
         13a-15(f) and 15d-15(f)) for the registrant and have:

         a) designed such  disclosure  controls and  procedures,  or caused such
         disclosure   controls  and   procedures   to  be  designed   under  our
         supervision,  to  ensure  the  material  information  relating  to  the
         registrant,  including its consolidated subsidiaries,  is made known to
         us by others within those entities,  particularly  during the period in
         which this report is being prepared;

         b) designed such  internal control over financial reporting,  or caused
         such  internal  control over  financial  reporting to be designed under
         our  supervision,   to  provide  reasonable  assurance  regarding   the
         reliability  of  financial  reporting and the  preparation of financial
         statements for external  purposes in accordance with generally accepted
         accounting principals;

         c) evaluated the effectiveness of the registrant's  disclosure controls
         and procedures and presented in this report our  conclusions  about the
         effectiveness of the disclosure controls and procedures,  as of the end
         of the period covered by this report based on such evaluation; and

         d)  disclosed  in this report any change in the  registrant's  internal
         control over financial  reporting that occurred during the registrant's
         most  recent  fiscal  quarter  that  has  materially  affected,  or  is
         reasonably  likely to  materially  affect,  the  registrant's  internal
         control over financial reporting; and

     5.  The registrant's other certifying  officer and I have disclosed,  based
         on our most  recent  evaluation  of  internal  control  over  financial
         reporting,  to the  registrant's  auditors  and the audit  committee of
         registrant's  board of directors or persons  performing  the equivalent
         functions:

         a) all significant  deficiencies and material  weaknesses in the design
         or operation of internal  control over  financial  reporting  which are
         reasonably  likely to  adversely  affect  the  registrant's  ability to
         record, process, summarize and report financial information; and

         b) any fraud,  whether or not  material,  that  involves  management or
         other  employees  who  have a  significant  role  in  the  registrant's
         internal control over financial reporting.


         Date:  May 10, 2005                        By:  /s/ Alan P. Hirmes
                                                         ------------------
                                                         Alan P. Hirmes
                                                         Chief Financial Officer


<PAGE>



                                                                    Exhibit 32.1



        CERTIFICATION UNDER SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
            (UNITED STATES CODE, TITLE 18, CHAPTER 63, SECTION 1350)
                  ACCOMPANYING QUARTERLY REPORT ON FORM 10-Q OF
                 CHARTERMAC FOR THE QUARTER ENDED MARCH 31, 2005


In  connection  with the  Quarterly  Report on Form 10-Q of  CharterMac  for the
quarterly  period  ending  March 31,  2005,  as filed  with the  Securities  and
Exchange  Commission  on the date hereof (the  "Report"),  Stuart J. Boesky,  as
Chief Executive  Officer of our Company,  and Alan P. Hirmes, as Chief Financial
Officer of our Company,  each hereby  certifies,  pursuant to 18 U.S.C.  Section
1350, that:


    (1) The Report fully  complies  with the  requirements  of Section  13(a) or
15(d), as applicable, of the Securities Exchange Act of 1934; and


    (2) The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of our Company.


By:  /s/ Stuart J. Boesky                           By:  /s/ Alan P. Hirmes
     --------------------                                ------------------
     Stuart J. Boesky                                    Alan P. Hirmes
     Chief Executive Officer                             Chief Financial Officer
     May 10, 2005                                        May 10, 2005