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**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      DC 20549**

**FORM      10-Q**

**      001-32216**

**NEW      YORK MORTGAGE TRUST, INC.**

| **Maryland**                                                                                | **47-0934168**                                               |
|---------------------------------------------------------------------------------------------|-------------------------------------------------------------------|
| (State                or Other Jurisdiction ofIncorporation                or Organization) | (I.R.S.                EmployerIdentification                No.) |

**1301      Avenue of the Americas, New York, New York 10019**

**(212)      634-9400**

| Large                Accelerated Filer  ̈ | Accelerated                Filer ý | Non-Accelerated                Filer  ̈ |
|-----------------------------------------------|-----------------------------------------|---------------------------------------------|

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**NEW      YORK MORTGAGE TRUST, INC.**

**FORM      10-Q**

|                                                                                                                              | **Page** |
|-----------------------------------------------------------------------------------------------------------------------------------|----------|
|                                                                                                                              |     |
| **Part                I. Financial Information**                                                                                  |     |
| Item                1. Consolidated Financial Statements (unaudited):                                                             |     |
| Consolidated                Balance Sheets                                                                                        | 3        |
| Consolidated                Statements of Operations                                                                              | 4        |
| Consolidated                Statements of Stockholders’ Equity                                                              | 5        |
| Consolidated                Statements of Cash Flows                                                                              | 6        |
| Notes                to Consolidated Financial Statements                                                                         | 8        |
| Item                2. Management’s Discussion and Analysis of Financial Condition and Results                of Operations | 42       |
| Forward                Looking Statement Effects                                                                                  | 37       |
| General                                                                                                                           | 38       |
| Strategic                Overview                                                                                                 | 38       |
| Description                of Business                                                                                            | 40       |
| Known                Material Trends and Commentary                                                                               | 41       |
| Significance                of Estimates and Critical Accounting Policies                                                         | 43       |
| Overview                of Performance                                                                                            | 45       |
| Summary                of Operations and Key Performance Measurements                                                             | 45       |
| Financial                Highlights for the Third Quarter of 2006                                                                 | 47       |
| Results                of Operations and Financial Condition                                                                      | 60       |
| Off-Balance                Sheet Arrangements                                                                                     | 65       |
| Liquidity                and Capital Resources                                                                                    | 66       |
| Inflation                                                                                                                         | 68       |
| Item                3. Quantitative and Qualitative Disclosures about Market Risk                                                 | 68       |
| Interest                Rate Risk                                                                                                 | 69       |
| Credit                Spread Exposure                                                                                             | 72       |
| Fair                Values                                                                                                        | 72       |
| Item                4. Controls and Procedures                                                                                    | 76       |
| **Part                II. Other Information**                                                                                     |     |
| Item                1. Legal Proceedings                                                                                          | 77       |
| Item                5. Other Information                                                                                          | 77       |
| Item                6. Exhibits                                                                                                   | 77       |
| Signatures                                                                                                                        | 79       |

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**PART      I: FINANCIAL INFORMATION**

**NEW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**CONSOLIDATED      BALANCE SHEETS**

|                                                                                                                                                                                                                                                                                            |   | **September                30,****2006**     |      | **December                31,****2005**                                                                                                              |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------|-----------|------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                                                                                                                                                            |   | (dollar                amounts in thousands) |      |
|                                                                                                                                                                                                                                                                                            |   | (unaudited)                                  |      | **                        ** |   |
| **ASSETS**                                                                                                                                                                                                                                                                                      |   |                                         |      |                                                                                                                                                 |   |
| Cash                and cash equivalents                                                                                                                                                                                                                                                        |   | $                                            | 6,879     |                                                                                                                                                 | $      | 9,056 |   |
| Restricted                cash                                                                                                                                                                                                                                                                  |   |                                         | 1,979     |                                                                                                                                                 |   | 5,468 |   |
| Investment                securities - available for sale                                                                                                                                                                                                                                       |   |                                         | 523,969   |                                                                                                                                                 |   | 716,482 |   |
| Due                from loan purchasers                                                                                                                                                                                                                                                         |   |                                         | 132,950   |                                                                                                                                                 |   | 121,813 |   |
| Escrow                deposits - pending loan closings                                                                                                                                                                                                                                          |   |                                         | 1,622     |                                                                                                                                                 |   | 1,434 |   |
| Accounts                and accrued interest receivable                                                                                                                                                                                                                                         |   |                                         | 9,256     |                                                                                                                                                 |   | 14,866 |   |
| Mortgage                loans held for sale                                                                                                                                                                                                                                                     |   |                                         | 109,197   |                                                                                                                                                 |   | 108,271 |   |
| Mortgage                loans held in securitization trusts                                                                                                                                                                                                                                     |   |                                         | 628,625   |                                                                                                                                                 |   | 776,610 |   |
| Mortgage                loans held for investment                                                                                                                                                                                                                                               |   |                                         | —   |                                                                                                                                                 |   | 4,060 |   |
| Prepaid                and other assets                                                                                                                                                                                                                                                         |   |                                         | 27,118    |                                                                                                                                                 |   | 16,505 |   |
| Derivative                assets                                                                                                                                                                                                                                                                |   |                                         | 3,402     |                                                                                                                                                 |   | 9,846 |   |
| Property                and equipment, net                                                                                                                                                                                                                                                      |   |                                         | 6,838     |                                                                                                                                                 |   | 6,882 |   |
| **Total                Assets**                                                                                                                                                                                                                                                                 |   | $                                            | 1,451,835 |                                                                                                                                                 | $      | 1,791,293 |   |
|                                                                                                                                                                                                                                                                                            |   |                                         |      |                                                                                                                                                 |   |   |   |
| **LIABILITIES                AND STOCKHOLDERS’ EQUITY**                                                                                                                                                                                                                                   |   |                                         |      |                                                                                                                                                 |   |   |   |
| **Liabilities:**                                                                                                                                                                                                                                                                                |   |                                         |      |                                                                                                                                                 |   |   |   |
| Financing                arrangements, portfolio investments                                                                                                                                                                                                                                    |   | $                                            | 886,956   |                                                                                                                                                 | $      | 1,166,499 |   |
| Financing                arrangements, loans held for sale/for investment                                                                                                                                                                                                                       |   |                                         | 208,285   |                                                                                                                                                 |   | 225,186 |   |
| Collateralized                debt obligations                                                                                                                                                                                                                                                  |   |                                         | 203,550   |                                                                                                                                                 |   | 228,226 |   |
| Due                to loan purchasers                                                                                                                                                                                                                                                           |   |                                         | 11,677    |                                                                                                                                                 |   | 1,652 |   |
| Accounts                payable and accrued expenses                                                                                                                                                                                                                                            |   |                                         | 14,736    |                                                                                                                                                 |   | 22,794 |   |
| Subordinated                debentures                                                                                                                                                                                                                                                          |   |                                         | 45,000    |                                                                                                                                                 |   | 45,000 |   |
| Derivative                liabilities                                                                                                                                                                                                                                                           |   |                                         | 686       |                                                                                                                                                 |   | 394 |   |
| Other                liabilities                                                                                                                                                                                                                                                                |   |                                         | 202       |                                                                                                                                                 |   | 584 |   |
| Total                liabilities                                                                                                                                                                                                                                                                |   |                                         | 1,371,092 |                                                                                                                                                 |   | 1,690,335 |   |
| **Commitments                and Contingencies (Note 13)**                                                                                                                                                                                                                                      |   |                                         |      |                                                                                                                                                 |   |   |   |
| **Stockholders’                Equity:**                                                                                                                                                                                                                                                  |   |                                         |      |                                                                                                                                                 |   |   |   |
| Common                stock, $0.01 par value, 400,000,000 shares authorized, 18,327,371                shares                issued and 18,077,160 outstanding at September 30, 2006 and 18,258,221                shares issued and 17,984,843 outstanding at December 31,                2005 |   |                                         | 183       |                                                                                                                                                 |   | 183 |   |
| Additional                paid-in capital                                                                                                                                                                                                                                                       |   |                                         | 100,324   |                                                                                                                                                 |   | 107,573 |   |
| Accumulated                other comprehensive (loss)/income                                                                                                                                                                                                                                    |   |                                         | (5,570    | )                                                                                                                                                    |   | 1,910 |   |
| Accumulated                deficit                                                                                                                                                                                                                                                              |   |                                         | (14,194   | )                                                                                                                                                    |   | (8,708 | ) |
| Total                stockholders’ equity                                                                                                                                                                                                                                                 |   |                                         | 80,743    |                                                                                                                                                 |   | 100,958 |   |
| **Total                Liabilities and Stockholders’ Equity**                                                                                                                                                                                                                             |   | $                                            | 1,451,835 |                                                                                                                                                 | $      | 1,791,293 |   |

*See        notes to consolidated financial statements.*

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**NEW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENTS OF OPERATIONS**

|                                                                         |   | **For                the Nine Months Ended****September                30, ** |    | **For                the Three Months Ended****September                30, ** |   |
|------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------|---------|-------------------------------------------------------------------------------------|--------|
|                                                                         |   | **2006 **                                                                     |    | **2005 **                                                                      |   | **2006 ** |   | **2005 ** |   |
|                                                                         |   | (amounts                in thousands, except per share data)                       |    |
|                                                                         |   | (unaudited)                                                                        |    |
| **Revenue:**                                                                 |   |                                                                               |    |                                                                                |   |   |   |   |   |
| Interest                income:                                              |   |                                                                               |    |                                                                                |   |   |   |   |   |
| Investment                securities and loans held in securitization trusts |   | $                                                                                  | 50,050  |                                                                                | $      | 40,523 |   | $ | 16,998 |   | $ | 13,442 |   |
| Loans                held for investment                                     |   |                                                                               | — |                                                                                |   | 5,388 |   |   | — |   |   | 1,783 |   |
| Loans                held for sale                                           |   |                                                                               | 12,155  |                                                                                |   | 10,573 |   |   | 3,880 |   |   | 4,473 |   |
| Total                interest income                                         |   |                                                                               | 62,205  |                                                                                |   | 56,484 |   |   | 20,878 |   |   | 19,698 |   |
| Interest                expense:                                             |   |                                                                               |    |                                                                                |   |   |   |   |   |   |   |  |   |
| Investment                securities and loans held in securitization trusts |   |                                                                               | 42,320  |                                                                                |   | 30,090 |   |   | 15,882 |   |   | 10,751 |   |
| Loans                held for investment                                     |   |                                                                               | — |                                                                                |   | 3,911 |   |   | — |   |   | 1,366 |   |
| Loans                held for sale                                           |   |                                                                               | 9,284   |                                                                                |   | 7,284 |   |   | 3,337 |   |   | 3,441 |   |
| Subordinated                debentures                                       |   |                                                                               | 2,656   |                                                                                |   | 1,095 |   |   | 877 |   |   | 601 |   |
| Total                interest expense                                        |   |                                                                               | 54,260  |                                                                                |   | 42,380 |   |   | 20,096 |   |   | 16,159 |   |
| Net                interest income                                           |   |                                                                               | 7,945   |                                                                                |   | 14,104 |   |   | 782 |   |   | 3,539 |   |
| **Other                Income (Expense):**                                   |   |                                                                               |    |                                                                                |   |   |   |   |   |   |   |  |   |
| Gain                on sales of mortgage loans                               |   |                                                                               | 14,362  |                                                                                |   | 21,634 |   |   | 4,311 |   |   | 8,985 |   |
| Loan                losses                                              |   |                                                                               | (4,077  | )                                                                                   |   | — |   |   | (4,077 | ) |   | — |   |
| Brokered                loan fees                                            |   |                                                                               | 8,672   |                                                                                |   | 7,181 |   |   | 2,402 |   |   | 2,647 |   |
| Loss                on sale of current period securitized loans              |   |                                                                               | (747    | )                                                                                   |   | — |   |   | — |   |   | — |   |
| (Loss)                gain on sale of securities and related hedges          |   |                                                                               | (529    | )                                                                                   |   | 2,207 |   |   | 440 |   |   | 1,286 |   |
| Miscellaneous                income                                          |   |                                                                               | 310     |                                                                                |   | 195 |   |   | 43 |   |   | 91 |   |
| Total                other income                                            |   |                                                                               | 17,991  |                                                                                |   | 31,217 |   |   | 3,119 |   |   | 13,009 |   |
| **Expenses:**                                                                |   |                                                                               |    |                                                                                |   |   |   |   |   |   |   |  |   |
| Salaries                and benefits                                         |   |                                                                               | 17,720  |                                                                                |   | 23,875 |   |   | 5,378 |   |   | 7,302 |   |
| Brokered                loan expenses                                        |   |                                                                               | 6,609   |                                                                                |   | 5,689 |   |   | 1,674 |   |   | 1,483 |   |
| Occupancy                and equipment                                       |   |                                                                               | 3,871   |                                                                                |   | 4,981 |   |   | 1,256 |   |   | 1,265 |   |
| Marketing                and promotion                                       |   |                                                                               | 1,643   |                                                                                |   | 3,900 |   |   | 427 |   |   | 1,310 |   |
| Data                processing and communications                            |   |                                                                               | 1,938   |                                                                                |   | 1,807 |   |   | 524 |   |   | 618 |   |
| Office                supplies and expenses                                  |   |                                                                               | 1,464   |                                                                                |   | 1,909 |   |   | 426 |   |   | 651 |   |
| Professional                fees                                             |   |                                                                               | 3,329   |                                                                                |   | 2,812 |   |   | 798 |   |   | 966 |   |
| Travel                and entertainment                                      |   |                                                                               | 409     |                                                                                |   | 707 |   |   | 126 |   |   | 261 |   |
| Depreciation                and amortization                                 |   |                                                                               | 1,625   |                                                                                |   | 1,069 |   |   | 539 |   |   | 302 |   |
| Other                                                                        |   |                                                                               | 1,308   |                                                                                |   | 1,084 |   |   | 536 |   |   | 531 |   |
| Total                expenses                                                |   |                                                                               | 39,916  |                                                                                |   | 47,833 |   |   | 11,684 |   |   | 14,689 |   |
| **(Loss)                Income Before Income Tax Benefit**                   |   |                                                                               | (13,980 | )                                                                                   |   | (2,512 | ) |   | (7,783 | ) |   | 1,859 |   |
| Income                tax benefit                                            |   |                                                                               | 8,494   |                                                                                |   | 5,880 |   |   | 3,915 |   |   | 1,000 |   |
| **Net                (Loss) Income**                                         |   | $                                                                                  | (5,486  | )                                                                                   | $      | 3,368 |   | $ | (3,868 | ) | $ | 2,859 |   |
| Basic                (loss) income per share                                 |   | $                                                                                  | (0.31   | )                                                                                   | $      | 0.19 |   | $ | (0.21 | ) | $ | 0.16 |   |
| Diluted                (loss) income per share                               |   | $                                                                                  | (0.31   | )                                                                                   | $      | 0.19 |   | $ | (0.21 | ) | $ | 0.16 |   |
| Weighted                average shares outstanding - basic                   |   |                                                                               | 17,975  |                                                                                |   | 17,855 |   |   | 18,025 |   |   | 17,958 |   |
| Weighted                average shares outstanding - diluted                 |   |                                                                               | 17,975  |                                                                                |   | 18,121 |   |   | 18,025 |   |   | 18,242 |   |

*See        notes to consolidated financial statements.*

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**NEW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENT OF STOCKHOLDERS’ EQUITY**

|                                                                                             |   | **For                the Nine Months Ended September 30, 2006** |    |
|--------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------|---------|
|                                                                                             |   | **Common****Stock**                                             |    | **Additional****Paid-In****Capital** |   | **Stockholders’****Deficit** |   | **Accumulated****Other****Comprehensive****(Loss)/Income** |   | **Comprehensive****(Loss)/Income** |   | **Total** |   |
|                                                                                             |   | (dollar                amounts in thousands)                    |    |
|                                                                                             |   | (unaudited)                                                     |    |
| **Balance, January                1, 2006 -**Stockholders’                Equity |   | $                                                               | 183     |   | $ | 107,573 |   | $ | (8,708 | ) | $ | 1,910 |   |   | — |   | $ | 100,958 |   |
| Net                loss                                                                          |   |                                                            | — |   |   | — |   |   | (5,486 | ) |   | — |   | $ | (5,486 | ) |   | (5,486 | ) |
| Dividends                declared                                                                |   |                                                            | — |   |   | (7,679 | ) |   | — |   |   | — |   |   | — |   |   | (7,679 | ) |
| Repurchase                of common stock                                                        |   |                                                            | (1      | ) |   | (299 | ) |   | — |   |   | — |   |   | — |   |   | (300 | ) |
| Vested                restricted stock                                                           |   |                                                            | 1       |   |   | 825 |   |   | — |   |   | — |   |   | — |   |   | 826 |   |
| Vested                performance shares                                                         |   |                                                            | — |   |   | 165 |   |   | — |   |   | — |   |   | — |   |   | 165 |   |
| Forfeited                performance shares                                                      |   |                                                            | — |   |   | (258 | ) |   | — |   |   | — |   |   | — |   |   | (258 | ) |
| Vested                stock options                                                              |   |                                                            | — |   |   | 25 |   |   | — |   |   | — |   |   | — |   |   | 25 |   |
| Forfeited                stock options                                                           |   |                                                            | — |   |   | (28 | ) |   | — |   |   | — |   |   | — |   |   | (28 | ) |
| Decrease                in net unrealized gain on available for sale securities                  |   |                                                            | — |   |   | — |   |   | — |   |   | (854 | ) |   | (854 | ) |   | (854 | ) |
| Decrease                in net unrealized gain on derivative instruments                         |   |                                                            | — |   |   | — |   |   | — |   |   | (6,626 | ) |   | (6,626 | ) |   | (6,626 | ) |
| Comprehensive                loss                                                                |   |                                                            | — |   |   | — |   |   | — |   |   | — |   | $ | (12,966 | ) |   | — |   |
| **Balance,                September 30, 2006 -**                Stockholders’ Equity       |   | $                                                               | 183     |   | $ | 100,324 |   | $ | (14,194 | ) | $ | (5,570 | ) |   |   |   | $ | 80,743 |   |

*See        notes to consolidated financial statements.*

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**NEW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENTS OF CASH FLOWS**

| **  **                                                                                                        |   | **For                the Nine Months Ended****September                30,** |       |
|-------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------|------------|
|                                                                                                                    |   | **2006**                                                                     |       | **2005** |   |
|                                                                                                                    |   |                                                                         |       |   |   |
|                                                                                                                    |   | (dollar                amounts in thousands)                                 |       |
|                                                                                                                    |   | (unaudited)                                                                  |       |
| **Cash                Flows from Operating Activities:**                                                                |   |                                                                         |       |   |   |
| Net                (loss) income                                                                                        |   | $                                                                            | (5,486     | ) | $ | 3,368 |   |
| Adjustments                to reconcile net (loss) income to net cash used in operating                activities: |   |                                                                         |       |   |   |  |   |
| Depreciation                and amortization                                                                            |   |                                                                         | 1,625      |   |   | 1,069 |   |
| Amortization                of premium on investment securities and mortgage loans                                      |   |                                                                         | 1,962      |   |   | 4,880 |   |
| Loss                on sale of current period securitized loans                                                         |   |                                                                         | 747        |   |   | — |   |
| Loss                (gain) on sale of securities and related hedges                                                     |   |                                                                         | 529        |   |   | (2,207 | ) |
| Purchase                of mortgage loans held for sale                                                                 |   |                                                                         | (222,907   | ) |   | — |   |
| Origination                of mortgage loans held for sale                                                              |   |                                                                         | (1,402,457 | ) |   | (1,723,917 | ) |
| Proceeds                from sales of mortgage loans                                                                    |   |                                                                         | 1,621,438  |   |   | 1,689,574 |   |
| Restricted                stock compensation expense                                                                    |   |                                                                         | 734        |   |   | 1,823 |   |
| Stock                option grants - compensation expense                                                               |   |                                                                         | (3         | ) |   | 34 |   |
| Deferred                tax benefit                                                                                     |   |                                                                         | (8,494     | ) |   | (5,880 | ) |
| Change                in value of derivatives                                                                           |   |                                                                         | 110        |   |   | (1,349 | ) |
| Loan                losses                                                                                              |   |                                                                         | 3,289      |   |   | — |   |
| Minority                interest expense                                                                                |   |                                                                         | (30        | ) |   | — |   |
| (Increase)                decrease in operating assets:                                                                 |   |                                                                         |       |   |   |  |   |
| Due                from loan purchasers                                                                                 |   |                                                                         | (11,137    | ) |   | (63,717 | ) |
| Escrow                deposits - pending loan closings                                                                  |   |                                                                         | (188       | ) |   | 4,303 |   |
| Accounts                and accrued interest receivable                                                                 |   |                                                                         | 5,610      |   |   | (473 | ) |
| Prepaid                and other assets                                                                                 |   |                                                                         | (3,036     | ) |   | (793 | ) |
| Increase                (decrease) in operating liabilities:                                                            |   |                                                                         |       |   |   |  |   |
| Due                to loan purchasers                                                                                   |   |                                                                         | 8,875      |   |   | 1,257 |   |
| Accounts                payable and accrued expenses                                                                    |   |                                                                         | (6,802     | ) |   | (583 | ) |
| Other                liabilities                                                                                        |   |                                                                         | (382       | ) |   | (16 | ) |
| Net                cash used in operating activities                                                                    |   |                                                                         | (16,003    | ) |   | (92,627 | ) |
|                                                                                                                    |   |                                                                         |       |   |   |   |   |
| **Cash                Flows from Investing Activities:**                                                                |   |                                                                         |       |   |   |  |   |
| Restricted                cash                                                                                          |   |                                                                         | 3,489      |   |   | 1,896 |   |
| Purchase                of investment securities                                                                        |   |                                                                         | (388,398   | ) |   | (148,150 | ) |
| Purchase                of mortgage loans held in securitization trusts                                                 |   |                                                                         | —    |   |   | (167,874 | ) |
| Principal                repayments received on mortgage loans held in securitization                trusts        |   |                                                                         | 151,450    |   |   | 77,721 |   |
| Proceeds                from sale of investment securities                                                              |   |                                                                         | 452,780    |   |   | 223,813 |   |
| Origination                of mortgage loans held for investment                                                        |   |                                                                         | —    |   |   | (456,028 | ) |
| Principal                paydown on investment securities                                                               |   |                                                                         | 126,203    |   |   | 320,540 |   |
| Payments                received on loans held for investment                                                           |   |                                                                         | —    |   |   | 8,935 |   |
| Purchases                of property and equipment                                                                      |   |                                                                         | (1,373     | ) |   | (2,724 | ) |
| Net                cash provided by (used in) investing activities                                                      |   |                                                                         | 344,151    |   |   | (141,871 | ) |

*See      notes to consolidated financial statements.*

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**NEW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENTS OF CASH FLOWS - (continued)**

| **  **                                                        |   | **For                the Nine Months Ended****September                30,** |     |
|-------------------------------------------------------------------------|--------|------------------------------------------------------------------------------|----------|
|                                                                    |   | **2006**                                                                     |     | **2005** |   |
|                                                                    |   |                                                                         |     |   |   |
|                                                                    |   | (dollar                amounts in thousands)                                 |     |
|                                                                    |   | (unaudited)                                                                  |     |
| **Cash                Flows from Financing Activities:**                |   |                                                                         |     |   |   |  |   |
| Repurchase                of common stock                               |   |                                                                         | (300     | ) |   | — |   |
| Change                in financing arrangements, net                    |   |                                                                         | (321,120 | ) |   | 206,618 |   |
| Dividends                paid                                           |   |                                                                         | (8,947   | ) |   | (13,431 | ) |
| Issuance                of subordinated debentures                      |   |                                                                         | —  |   |   | 45,000 |   |
| Capital                contributions from minority interest member      |   |                                                                         | 42       |   |   | — |   |
| Net                cash (used in) provided by financing activities      |   |                                                                         | (330,325 | ) |   | 238,187 |   |
|                                                                    |   |                                                                         |     |   |   |   |   |
| **Net                (Decrease) Increase in Cash and Cash Equivalents** |   |                                                                         | (2,177   | ) |   | 3,689 |   |
| **Cash                and Cash Equivalents - Beginning of Period**      |   |                                                                         | 9,056    |   |   | 7,613 |   |
| **Cash                and Cash Equivalents - End of Period**            |   | $                                                                            | 6,879    |   | $ | 11,302 |   |
|                                                                    |   |                                                                         |     |   |   |   |   |
| **Supplemental                Disclosure**                              |   |                                                                         |     |   |   |  |   |
| Cash                paid for interest                                   |   | $                                                                            | 68,398   |   | $ | 65,716 |   |
|                                                                    |   |                                                                         |     |   |   |   |   |
| **Non                Cash Financing Activities**                        |   |                                                                         |     |   |   |   |   |
| Dividends                declared to be paid in subsequent period       |   | $                                                                            | 2,566    |   | $ | 3,826 |   |

*See        notes to consolidated financial statements.*

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

| **1.  ** | **Summary                of Significant Accounting                Policies** |
|--------------------|------------------------------------------------------------------------------|

*Basis      of Presentation*

----

**NEW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

** **
**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

| **1.  ** | **Summary                of Significant Accounting Policies****- (continued)** |
|--------------------|--------------------------------------------------------------------------------|

*Use      of Estimates*

*Cash      and Cash Equivalents*

*Restricted      Cash*

*Investment      Securities Available for Sale*

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**1.      Summary of Significant Accounting Policies**
**      - (continued)**

** **

*Due      from Loan Purchasers and Escrow Deposits*
*      Pending Loan Closings*

*Mortgage      Loans Held for Sale*

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

| **1.  ** | **Summary                of Significant Accounting Policies****- (continued)** |
|--------------------|--------------------------------------------------------------------------------|

*Mortgage      Loans Held in Securitization Trusts*

*Mortgage      Loans Held for Investment*

*Mortgage      Servicing Rights*

*Credit      Risk and Allowance for Loan Losses*

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**1.      Summary of Significant Accounting Policies**
**      - (continued)**

*Property      and Equipment, Net*

*Financing      Arrangements, Portfolio Investments*

*Financing      Arrangements, Loans Held for Sale/for Investment *

*Collateralized      Debt Obligations*

*Subordinated      Debentures*

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**1.      Summary of Significant Accounting Policies**
**      - (continued)**

*Derivative      Financial Instruments*

*Risk      Management*

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**1.      Summary of Significant Accounting Policies**
**      - (continued)**

*Interest      Rate Risk*

|   | · | the                items to be hedged expose the Company to interest rate risk;                and |
|--------|--------|----------------------------------------------------------------------------------------------------|

|   | · | the                interest rate swaps or caps are expected to be and continue to be                highly                effective in reducing the Company’s exposure to interest rate                risk. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

*Termination      of Hedging Relationships*

*Other      Comprehensive Income*

*Gain      on Sale of Mortgage Loans*

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**1.      Summary of Significant Accounting Policies**
**      - (continued)**

*Loan      Origination Fees and Direct Origination Cost*

*Brokered      Loan Fees and Expenses*

*Loan      Commitment Fees*

*Loan      Losses*

*Employee      Benefit Plans*

*Stock      Based Compensation*

*Marketing      and Promotion*

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**1.      Summary of Significant Accounting Policies**
**      - (continued)**

*Income      Taxes*

*Earnings      Per Share*

*New      Accounting Pronouncements*

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**1.      Summary of Significant Accounting Policies**
**      - (continued)**

**2.      Investment Securities Available for Sale**

|                                                                                                                                                                                                                                                                                                                                      |   | **September                30, 2006** |    | **December                31, 2005** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|---------|--------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                      |   |                             |    |                            |   |
| Amortized                cost                                                                                                                                                                                                                                                                                                             |   | $                                     | 528,923 |                                 | $      | 720,583 |   |
| Gross                unrealized gains                                                                                                                                                                                                                                                                                                     |   |                                  | 664     |                                 |   | 1 |   |
| Gross                unrealized                losses                                               |   |                                  | (5,618  | )                                    |   | (4,102 | ) |
| Fair                value                                                                                                                                                                                                                                                                                                                 |   | $                                     | 523,969 |                                 | $      | 716,482 |   |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

| **2.  ** | **Investment                Securities Available****for                Sale - (continued)** |
|--------------------|---------------------------------------------------------------------------------------------|

|                                                                                                                                                                                                                                                                                                                                           |   | **Less                than 6 Months** |    | **More                than 6 Months****to                24 Months** |   | **More                than 24 Months****to                60 Months** |   | **Total**                        |    |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|---------|----------------------------------------------------------------------|--------|-----------------------------------------------------------------------|--------|----------------------------------|---------|
| **                                                       ** |   | **Carrying****Value**                 |    | **Weighted****Average****Yield**                                     |   | **Carrying****Value**                                                 |   | **Weighted****Average****Yield** |    | **Carrying****Value** |   | **Weighted****Average****Yield** |   | **Carrying****Value** |   | **Weighted****Average****Yield** |   |
|                                                                                                                                                                                                                                                                                                                                           |   |                                  |    |                                                                 |   |                                                                  |   |                             |    |   |   |   |   |   |   |   |   |
| Agency                REMIC CMO Floating Rate                                                                                                                                                                                                                                                                                                  |   | $                                     | 178,991 |                                                                 |   | 6.56                                                                  | %      | $                                | — |   |   | — |   | $ | — |   |   | — |   | $ | 178,991 |   |   | 6.56 | % |
| Private                Label Floaters                                                                                                                                                                                                                                                                                                          |   |                                  | 27,500  |                                                                 |   | 6.28                                                                  | %      |                             | — |   |   | — |   |   | — |   |   | — |   |   | 27,500 |   |   | 6.28 | % |
| Private                Label ARMs                                                                                                                                                                                                                                                                                                              |   |                                  | — |                                                                 |   | —                                                               |   |                             | 43,703  |   |   | 6.45 | % |   | 249,534 |   |   | 6.05 | % |   | 293,237 |   |   | 6.11 | % |
| NYMT                Retained Securities                                                                                                                                                                                                                                                                                                        |   |                                  | 6,022   |                                                                 |   | 7.15                                                                  | %      |                             | — |   |   | — |   |   | 18,219 |   |   | 6.93 | % |   | 24,241 |   |   | 6.99 | % |
| Total/Weighted                Average                                                                                                                                                                                                                                                                                                          |   | $                                     | 212,513 |                                                                 |   | 6.54                                                                  | %      | $                                | 43,703  |   |   | 6.45 | % | $ | 267,753 |   |   | 6.12 | % | $ | 523,969 |   |   | 6.32 | % |

| **                                                   ** |   | **Less                than****6                Months** |    | **More                than 6 Months****To                24 Months** |   | **More                than 24 Months****To                60 Months** |   | **Total**                        |    |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------|---------|----------------------------------------------------------------------|--------|-----------------------------------------------------------------------|--------|----------------------------------|---------|
|                                                                                                                                                                                                                                                                                                                   |   | **Carrying****Value**                                   |    | **Weighted****Average****Yield**                                     |   | **Carrying****Value**                                                 |   | **Weighted****Average****Yield** |    | **Carrying****Value** |   | **Weighted****Average****Yield** |   | **Carrying****Value** |   | **Weighted****Average****Yield** |   |
|                                                                                                                                                                                                                                                                                                                   |   |                                                    |    |                                                                 |   |                                                                  |   |                             |    |   |   |   |   |   |   |   |   |
| Agency                REMIC CMO Floating Rate                                                                                                                                                                                                                                                                          |   | $                                                       | 13,535  |                                                                 |   | 5.45                                                                  | %      | $                                | — |   |   | — |   | $ | — |   |   | — |   | $ | 13,535 |   |   | 5.45 | % |
| FHLMC                Agency ARMs                                                                                                                                                                                                                                                                                       |   |                                                    | — |                                                                 |   | —                                                               |   |                             | 91,217  |   |   | 3.82 | % |   | — |   |   | — |   |   | 91,217 |   |   | 3.82 | % |
| FNMA                Agency ARMs                                                                                                                                                                                                                                                                                        |   |                                                    | — |                                                                 |   | —                                                               |   |                             | 297,048 |   |   | 3.91 | % |   | — |   |   | — |   |   | 297,048 |   |   | 3.91 | % |
| Private                Label ARMs                                                                                                                                                                                                                                                                                      |   |                                                    | — |                                                                 |   | —                                                               |   |                             | 57,605  |   |   | 4.22 | % |   | 257,077 |   |   | 4.57 | % |   | 314,682 |   |   | 4.51 | % |
| Total/Weighted                Average                                                                                                                                                                                                                                                                                  |   | $                                                       | 13,535  |                                                                 |   | 5.45                                                                  | %      | $                                | 445,870 |   |   | 3.93 | % | $ | 257,077 |   |   | 4.57 | % | $ | 716,482 |   |   | 4.19 | % |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | **September                30, 2006**  |    |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------|---------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | **Less                than 12 Months** |    | **12                Months or More** |   | **Total** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | **Fair****Value**                      |    | **Gross****Unrealized****Losses** |   | **Fair****Value** |   | **Gross****Unrealized****Losses** |   | **Fair****Value** |   | **Gross****Unrealized****Losses** |   |
|                                                                                |   |                                   |    |   |   |   |   |   |   |   |   |   |   |
| Agency                REMIC CMO Floating Rate                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | $                                      | 64,986  |   | $ | 180 |   | $ | 7,969 |   | $ | 2 |   | $ | 72,955 |   | $ | 182 |   |
| Private                Label Floaters                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                   | 3,969   |   |   | 41 |   |   | — |   |   | — |   |   | 3,969 |   |   | 41 |   |
| Private                Label ARMs                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                   | — |   |   | — |   |   | 302,421 |   |   | 5,306 |   |   | 302,421 |   |   | 5,306 |   |
| NYMT                Retained Securities                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                                   | 8,294   |   |   | 89 |   |   | — |   |   | — |   |   | 8,294 |   |   | 89 |   |
| Total                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | $                                      | 77,249  |   | $ | 310 |   | $ | 310,390 |   | $ | 5,308 |   | $ | 387,639 |   | $ | 5,618 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | **December                31, 2005**   |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------|--------|
| **                                                                                                ** |   | **Less                than 12 Months** |   | **12                Months or More** |   | **Total** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | **Fair****Value**                      |   | **Gross****Unrealized****Losses** |   | **Fair****Value** |   | **Gross****Unrealized****Losses** |   | **Fair****Value** |   | **Gross****Unrealized****Losses** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                   |   |   |   |   |   |   |   |   |   |   |   |
| Agency                REMIC CMO Floating Rate                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | $                                      | 11,761 |   | $ | 19 |   | $ | — |   | $ | — |   | $ | 11,761 |   | $ | 19 |   |
| Private                Label ARMs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                   | 48,642 |   |   | 203 |   |   | 270,124 |   |   | 3,880 |   |   | 318,766 |   |   | 4,083 |   |
| Total                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | $                                      | 60,403 |   | $ | 222 |   | $ | 270,124 |   | $ | 3,880 |   | $ | 330,527 |   | $ | 4,102 |   |

**3**
**.      Mortgage Loans Held for Sale**

|                                                                                                                                                                                                                                                                                                                                              |   | **September                30, 2006** |    | **December                31, 2005** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|---------|--------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                              |   |                             |    |                            |   |
| Mortgage                loans principal                amount                                               |   | $                                     | 110,804 |                                 | $      | 108,244 |   |
| Impairment                adjustment                                                                                                                                                                                                                                                                                                              |   |                                  | (1,709  | )                                    |   | — |   |
| Deferred                origination costs - net                                                                                                                                                                                                                                                                                                   |   |                                  | 102     |                                 |   | 27 |   |
| Mortgage                loans held for sale                                                                                                                                                                                                                                                                                                       |   | $                                     | 109,197 |                                 | $      | 108,271 |   |

**4**
**.      Mortgage Loans Held in Securitization Trusts**

|                                                                                                                                                                                   |   | **September                30, 2006** |    | **December                31, 2005** |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|---------|--------------------------------------|--------|
|                                                                                                                                                                                   |   |                                  |    |                            |   |
| Mortgage                loans principal amount                                                                                                                                         |   | $                                     | 624,528 |                                 | $      | 771,451 |   |
| Deferred                origination costs - net                                                                                                                                        |   |                                  | 4,097   |                                 |   | 5,159 |   |
| Total                mortgage loans held in securitization                trusts                  |   | $                                     | 628,625 |                                 | $      | 776,610 |   |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**4**
**.      Mortgage Loans Held in Securitization Trusts - (continued)**

| **Days                Late**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | **Number                of****Delinquent****Loans** |   | **Total****Dollar****Amount** |   | **%                of Loan****Portfolio** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------|--------|-------------------------------|--------|-------------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                           |   |                     |   |                                 |   |
| 30-60                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                                                | 3      |                          | $      | 3,686                                     |   |   | 0.59 | % |
| 61-90                                                                                    |   |                                                | 1      |                          |   | 193                                       |   |   | 0.03 | % |
| 90+                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                | 3      |                          |   | 2,569                                     |   |   | 0.41 | % |
| Totals                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                                | 7      |                          | $      | 6,448                                     |   |   |   |   |

| **Days                Late**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | **Number                of****Delinquent****Loans** |    | **Total****Dollar****Amount** |   | **%                of Loan****Portfolio** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------|---------|-------------------------------|--------|-------------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                           |    |                     |   |                                 |   |
| 30-60                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                                                | 1       |                          | $      | 193                                       |   |   | 0.02 | % |
| 61-90                                                                                    |   |                                                | — |                          |   | —                                   |   |   | — |   |
| 90+                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                | 3       |                          |   | 1,771                                     |   |   | 0.23 | % |
| Totals                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                                | 4       |                          | $      | 1,964                                     |   |   |   |   |

**5**
**.      Mortgage Loans Held for Investment**

|                                                                                                                                                                                                                                                                                                                                                                                                             |   | **December                31, 2005** |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                             |   |                            |   |
| Mortgage                loans principal amount                                                                                                                                                                                                                                                                                                                                                                   |   | $                                    | 4,054  |   |
| Deferred                origination costs - net                                                                                                                                                                                                                                                                                                                                                                  |   |                                 | 6      |   |
| Total                mortgage loans held for                investment                                                        |   | $                                    | 4,060  |   |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**6**
**.        Sale of Mortgage Loans Through Securitization**

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**7**
**.      Property and Equipment - Net**

|                                                           | **     ** | **September                30, 2006** | **     ** | **December                31, 2005** |   |
|----------------------------------------------------------------|------------------------------------|---------------------------------------|------------------------------------|--------------------------------------|--------|
|                                                           |                               |                                  |                               |                                 |   |   |   |
| Office                and computer equipment                   |                               | $                                     | 7,715                              |                                 | $      | 6,292 |   |
| Furniture                and fixtures                          |                               |                                  | 2,201                              |                                 |   | 2,306 |   |
| Leasehold                improvements                          |                               |                                  | 1,491                              |                                 |   | 1,429 |   |
| Total                premises and equipment                    |                               |                                  | 11,407                             |                                 |   | 10,027 |   |
| Less:                accumulated depreciation and amortization |                               |                                  | (4,569                             | )                                    |   | (3,145 | ) |
| Property                and equipment - net                    |                               | $                                     | 6,838                              |                                 | $      | 6,882 |   |

**8**
**.      Derivative Instruments and Hedging Activities**

|                                                                         |   | **September                30, 2006** |    | **December                31, 2005** |   |
|------------------------------------------------------------------------------|--------|---------------------------------------|---------|--------------------------------------|--------|
|                                                                         |   |                                  |    |                                 |   |
| **Derivative                Assets:**                                        |   |                                  |    |                                 |   |
| Interest                rate caps                                            |   | $                                     | 2,179   |                                 | $      | 3,340 |   |
| Interest                rate swaps                                           |   |                                  | 717     |                                 |   | 6,383 |   |
| Interest                rate lock commitments - loan commitments             |   |                                  | 136     |                                 |   | 123 |   |
| Interest                rate lock commitments - mortgage loans held for sale |   |                                  | 370     |                                 |   | — |   |
| Total                derivative assets                                       |   | $                                     | 3,402   |                                 | $      | 9,846 |   |
| **Derivative                Liabilities:**                                   |   |                                  |    |                                 |   |   |   |
| Forward                loan sale contracts - loan commitments                |   |                                  | (71     | )                                    |   | (38 | ) |
| Forward                loan sale contracts - mortgage loans held for sale    |   |                                  | (130    | )                                    |   | (18 | ) |
| Forward                loan sale contracts - TBA securities                  |   |                                  | (485    | )                                    |   | (324 | ) |
| Interest                rate lock commitments - mortgage loans held for sale |   |                                  | — |                                 |   | (14 | ) |
| Total                derivative liabilities                                  |   | $                                     | (686    | )                                    | $      | (394 | ) |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**9**
**.      Financing Arrangements, Portfolio Investments**

**Repurchase      Agreements by Counterparty**

| **Counterparty                Name**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | **September                30, 2006** |    | **December                31, 2005** |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|---------|--------------------------------------|--------|
|                                                                                                                     |   |                             |    |                            |   |
| Barclays                Bank                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | $                                     | 22,000  |                                 | $      | — |   |
| Citigroup                Global Markets Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                  | — |                                 |   | 200,000 |   |
| Countrywide                Securities Corporation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                  | 184,101 |                                 |   | 109,632 |   |
| Credit                Suisse First Boston LLC                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                                  | — |                                 |   | 148,131 |   |
| Deutsche                Bank Securities Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                  | — |                                 |   | 205,233 |   |
| HSBC                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                  | — |                                 |   | 163,781 |   |
| J.P.                Morgan Securities Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                                  | 37,521  |                                 |   | 37,481 |   |
| Merrill                Lynch Government Securities Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                  | 124,859 |                                 |   | — |   |
| Nomura                Securities International, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                  | 160,088 |                                 |   | — |   |
| WaMu                Capital Corp                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                                  | 95,823  |                                 |   | 158,457 |   |
| West                LB                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                  | 262,564 |                                 |   | 143,784 |   |
| **Total                Financing Arrangements, Portfolio Investments**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $                                     | 886,956 |                                 | $      | 1,166,499 |   |

**10**
**.      Financing Arrangements, Mortgage Loans Held for Sale or      Investment**

|                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   | **September                30, 2006** |    |                              **December                  31, 2005** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|---------|--------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                  |    |                                                                                                                                 |   |   |   |
| $250                million master repurchase agreement with Greenwich Capital Financial                Products,                Inc., expiring on December 4, 2006 bearing interest at one-month                LIBOR                plus spreads from 0.75% to 1.25% depending on collateral (5.14% at                December 31, 2005). Principal repayments are required 120 days from                the                funding                date.(a) |   | $                                     | — |                                                                                                                                 | $      | 81,577 |   |
| $200                million master repurchase agreement with CSFB expiring on March 30,                2007                bearing interest at daily LIBOR plus spreads from 0.75% to 2.0%                depending                on collateral (6.31% at September 30, 2006 and 5.28% at December                31,                2005). Principal repayments are required 90 days from the funding                date.                                  |   |                                  | 121,835 |                                                                                                                                 |   | 143,609 |   |
| $300                million master repurchase agreement with Deutsche Bank Structured                Products,                Inc. expiring on December 13, 2006 bearing interest at 1 month                LIBOR                plus spreads from .625% to 1.25% depending on collateral (6.0% at                September                30, 2006). Principal payments are due 120 days from the repurchase                date.                            |   |                                  | 86,450  |                                                                                                                                 |   | — |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   | $                                     | 208,285 |                                                                                                                                 | $      | 225,186 |   |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**10**
**.      Financing Arrangements, Mortgage Loans Held for Sale or Investment -      (continued)**

| (a) | This                credit facility, with Greenwich Capital Financial Products, Inc.,                requires                the Company to transfer specific collateral to the lender under repurchase                agreements; however, due to the rate of turnover of the collateral                by the                Company, the counterparty has not taken title to or recorded their                interest in any of the collateral transferred. Interest is paid to                the                counterparty based on the amount of outstanding borrowings and on                the                terms provided. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**11**
**.      Collateralized Debt Obligations**

**12**
**.      Subordinated Debentures**

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006**

**(unaudited)**

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006**

**(unaudited)**

**13**
**.      Commitments and Contingencies**

*Loans      Sold to Investors*

*Loans      Funding and Delivery Commitments*

*Net      Worth Requirements*

*Outstanding      Litigation*

*Leases*

*Letters      of Credit*

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006**

**(unaudited)**

**14**
**.      Related Party Transactions**

**15.      **
**Concentrations      of Credit Risk**

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | **     ** | **September                30, 2006** |   | **December                31, 2005** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------|---------------------------------------|--------|--------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                               |                                  |   |                                 |   |   |   |
| New                York                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                               |                                  | 14.8   | %                                    |   | 43.0 | % |
| New                Jersey                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                               |                                  | 14.6   | %                                    |   | 5.1 | % |
| Massachusetts                                                                                    |                               |                                  | 12.3   | %                                    |   | 17.8 | % |
| Connecticut                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                               |                                  | 7.7    | %                                    |   | 5.8 | % |
| Pennsylvania                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                               |                                  | 5.9    | %                                    |   | 4.6 | % |
| Florida                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                               |                                  | 3.0    | %                                    |   | 9.7 | % |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | **     ** | **September                30, 2006** | **      ** | **December                31, 2005** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------|---------------------------------------|------------------------------------------|--------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                               |                                  |                                     |                                 |   |   |   |
| New                York                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                               |                                  | 25.4                                     | %                                    |   | 32.7 | % |
| Massachusetts                                                                                    |                               |                                  | 14.3                                     | %                                    |   | 19.4 | % |
| California                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                               |                                  | 7.8                                      | %                                    |   | 14.1 | % |
| New                Jersey                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                               |                                  | 4.1                                      | %                                    |   | 5.8 | % |
| Florida                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                               |                                  | 3.9                                      | %                                    |   | 5.4 | % |

**16**
**.      Fair Value of Financial Instruments**

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**16**
**.      Fair Value of Financial Instruments - (continued)**

*Investment      Securities Available for Sale*

*.      Mortgage Loans Held for Sale*

*Mortgage      Loans Held for Investment*

*Mortgage      Loans Held in Securitization Trusts*

*      Interest Rate Lock Commitments*

*Forward      Sale Loan Contracts*

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**16**
**.      Fair Value of Financial Instruments - (continued)**

|                                                            |   | **September                30, 2006** |      |
|-----------------------------------------------------------------|--------|---------------------------------------|-----------|
|                                                            |   | **Notional                Amount**    |      | **Carrying                Amount** |   | **Estimated****Fair                Value** |   |
|                                                            |   |                             |      |    |   |    |   |
| Investment                securities available for sale         |   | $                                     | 527,275   |   | $ | 523,969 |   | $ | 523,969 |   |
| Mortgage                loans held in the securitization trusts |   |                                  | 624,528   |   |   | 628,625 |   |   | 624,342 |   |
| Mortgage                loans held for sale                     |   |                                  | 109,095   |   |   | 109,197 |   |   | 110,538 |   |
| Commitments                and contingencies:                   |   |                                  |      |   |   |   |   |   |   |   |
| Interest                rate lock commitments                   |   |                                  | 258,368   |   |   | 506 |   |   | 506 |   |
| Forward                loan sales contracts                     |   |                                  | 176,543   |   |   | (686 | ) |   | (686 | ) |
| Interest                rate swaps                              |   |                                  | 285,000   |   |   | 717 |   |   | 717 |   |
| Interest                rate caps                               |   |                                  | 1,615,545 |   |   | 2,179 |   |   | 2,179 |   |

|                                                                         |   | **December                31, 2005** |      |
|------------------------------------------------------------------------------|--------|--------------------------------------|-----------|
|                                                                         |   | **Notional                Amount**   |      | **Carrying                Amount** |   | **Estimated****Fair                Value** |   |
|                                                                         |   |                            |      |    |   |    |   |
| Investment                securities available for sale                      |   | $                                    | 719,701   |   | $ | 716,482 |   | $ | 716,482 |   |
| Mortgage                loans held for investment                       |   |                                 | 4,054     |   |   | 4,060 |   |   | 4,079 |   |
| Mortgage                loans held in the securitization trusts              |   |                                 | 771,451   |   |   | 776,610 |   |   | 775,311 |   |
| Mortgage                loans held for sale                                  |   |                                 | 108,244   |   |   | 108,271 |   |   | 109,252 |   |
| Commitments                and contingencies:                                |   |                                 |      |   |   |   |   |   |   |   |
| Interest                rate lock commitments - loan commitments             |   |                                 | 130,320   |   |   | 123 |   |   | 123 |   |
| Interest                rate lock commitments - mortgage loans held for sale |   |                                 | 108,109   |   |   | (14 | ) |   | (14 | ) |
| Forward                loan sales contracts                                  |   |                                 | 201,771   |   |   | (380 | ) |   | (380 | ) |
| Interest                rate swaps                                           |   |                                 | 645,000   |   |   | 6,383 |   |   | 6,383 |   |
| Interest                rate caps                                            |   |                                 | 1,858,860 |   |   | 3,340 |   |   | 3,340 |   |

**17**
**.      Income Taxes**

|                                                               |   | **September                30, 2006**                                                                                                                                                                          |    | **September                30, 2005**                                                                                                                                                                          |   |
|--------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                               |   | **     ****                            ** |    | **     ****                            ** |   |
| Tax                at statutory rate (35%)                         |   | $                                                                                                                                                                                                              | (4,893  | )                                                                                                                                                                                                              | $      | (879 | ) |
| Non-taxable                REIT income                             |   |                                                                                                                                                                                                           | (1,825  | )                                                                                                                                                                                                              |   | (3,994 | ) |
| Transfer                pricing of loans sold to nontaxable parent |   |                                                                                                                                                                                                           | 11      |                                                                                                                                                                                                           |   | 605 |   |
| State                and local taxes                               |   |                                                                                                                                                                                                           | (1,773  | )                                                                                                                                                                                                              |   | (1,174 | ) |
| Change                in tax status                                |   |                                                                                                                                                                                                           | — |                                                                                                                                                                                                           |   | (452 | ) |
| Miscellaneous                                                      |   |                                                                                                                                                                                                           | (14     | )                                                                                                                                                                                                              |   | 14 |   |
| Total                provision (benefit)                           |   | $                                                                                                                                                                                                              | (8,494  | )                                                                                                                                                                                                              | $      | (5,880 | ) |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**17**
**.      Income Taxes - (continued)**

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | **Deferred** |   | **Total**    |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------|--------|--------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |    |   |    |   |
| Regular                tax                benefit                                                                                    |   |    |   |    |   |
| Federal                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $            | (6,721 | )            | $      | (6,721 | ) |
| State                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |         | (1,773 | )            |   | (1,773 | ) |
| Total                tax benefit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $            | (8,494 | )            | $      | (8,494 | ) |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | **Deferred** |   | **Total**    |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------|--------|--------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |    |   |    |   |
| Regular                tax                benefit                                                                                    |   |    |   |    |   |
| Federal                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $            | (4,706 | )            | $      | (4,706 | ) |
| State                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |         | (1,174 | )            |   | (1,174 | ) |
| Total                tax benefit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $            | (5,880 | )            | $      | (5,880 | ) |

| Deferred                tax                asset:                                                                                                       |   |   |   |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|
| Net                operating loss carry forward                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | $      | 16,578 |   |
| Restricted                stock, performance shares and stock option expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   | 309    |   |
| Rent                expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   | 559    |   |
| Management                compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   | 6      |   |
| Mark                to market adjustments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   | 2      |   |
| GAAP                reserves                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   | 923    |   |
| Loss                on sublease                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   | 127    |   |
| Total                deferred tax asset                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   | 18,504 |   |
| Deferred                tax liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   |   |   |
| Depreciation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   | 152    |   |
| Net                deferred tax asset                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | $      | 18,352 |   |

| Deferred                tax asset:                                                                                                                        |   |   |   |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|
| Net                operating loss carry forward                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $      | 9,560  |   |
| Restricted                stock, performance shares and stock option expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   | 125    |   |
| Rent                expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 120    |   |
| Management                compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   | 98     |   |
| Loss                on sublease                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |   | 181    |   |
| Mark                to market adjustments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   | 94     |   |
| Total                deferred tax asset                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   | 10,178 |   |
| Deferred                tax liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |   |   |
| Depreciation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   | 319    |   |
| Net                deferred tax asset                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | $      | 9,859  |   |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**17**
**.      Income Taxes - (continued)**

**18.      **
**Segment      Reporting**

|   | · | *Mortgage                Portfolio Management -*                long-term investment in high-quality, adjustable-rate mortgage loans                and                residential mortgage-backed securities;                and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | *Mortgage                Lending*                -                mortgage loan originations as conducted by                NYMC. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------|

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**18**
**.      Segment Reporting - (continued)**

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | **Nine                Months Ended September 30, 2006** |      |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------|-----------|
| **                                                                                                                          ** |   | **Mortgage****Portfolio****Management****Segment**           |      | **Mortgage****Lending****Segment** |   | **Total** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | (dollar                amounts in thousands)                 |      |
| **Revenue:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                         |      |   |   |   |   |
| Interest                income:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                                         |      |   |   |   |   |
| Investment                securities and loans held in securitization                trusts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | $                                                            | 50,050    |   | $ | — |   | $ | 50,050 |   |
| Loans                held for sale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                         | —   |   |   | 12,155 |   |   | 12,155 |   |
| Total                interest income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                                         | 50,050    |   |   | 12,155 |   |   | 62,205 |   |
| Interest                expense:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                         |      |   |   |   |   |   |   |   |
| Investment                securities and loans held in securitization trusts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                         | 42,320    |   |   | — |   |   | 42,320 |   |
| Loans                held for sale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                         | —   |   |   | 9,284 |   |   | 9,284 |   |
| Subordinated                debentures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                         | —   |   |   | 2,656 |   |   | 2,656 |   |
| Total                interest expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                         | 42,320    |   |   | 11,940 |   |   | 54,260 |   |
| Net                interest income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                         | 7,730     |   |   | 215 |   |   | 7,945 |   |
| **Other                Income (Expense):**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                                         |      |   |   |   |   |   |   |   |
| Gain                on sales of mortgage loans                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                                                         | —   |   |   | 14,362 |   |   | 14,362 |   |
| Loan                losses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                                         | (52       | ) |   | (4,025 | ) |   | (4,077 | ) |
| Brokered                loan fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                                         | —   |   |   | 8,672 |   |   | 8,672 |   |
| Loss                on sale of current period securitized loans                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                                         | —   |   |   | (747 | ) |   | (747 | ) |
| Loss                on sale of securities and related hedges                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                         | (529      | ) |   | — |   |   | (529 | ) |
| Miscellaneous                income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                                                         | —   |   |   | 310 |   |   | 310 |   |
| Total                other(expense) income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                                         | (581      | ) |   | 18,572 |   |   | 17,991 |   |
| **Expenses:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                                         |      |   |   |   |   |   |   |   |
| Salaries                and benefits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                                         | 618       |   |   | 17,102 |   |   | 17,720 |   |
| Brokered                loan expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                         | —   |   |   | 6,609 |   |   | 6,609 |   |
| Occupancy                and equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                         | 1         |   |   | 3,870 |   |   | 3,871 |   |
| Marketing                and promotion                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                         | 54        |   |   | 1,589 |   |   | 1,643 |   |
| Data                processing and communication                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                         | 177       |   |   | 1,761 |   |   | 1,938 |   |
| Office                supplies and expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                                                         | 23        |   |   | 1,441 |   |   | 1,464 |   |
| Professional                fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                         | 447       |   |   | 2,882 |   |   | 3,329 |   |
| Travel                and entertainment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                                         | 29        |   |   | 380 |   |   | 409 |   |
| Depreciation                and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                         | —   |   |   | 1,625 |   |   | 1,625 |   |
| Other                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                         | 124       |   |   | 1,184 |   |   | 1,308 |   |
| Total                expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                                         | 1,473     |   |   | 38,443 |   |   | 39,916 |   |
| **Income                (Loss) Before Income Tax Benefit**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                                         | 5,676     |   |   | (19,656 | ) |   | (13,980 | ) |
| Income                tax benefit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                                         | —   |   |   | 8,494 |   |   | 8,494 |   |
| **Net                Income (Loss)**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $                                                            | 5,676     |   | $ | (11,162 | ) | $ | (5,486 | ) |
| Segment                assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                                                            | 1,163,802 |   | $ | 288,033 |   | $ | 1,451,835 |   |
| Segment                equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                                                            | 59,012    |   | $ | 21,731 |   | $ | 80,743 |   |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIESOTES TO CONSOLIDATED FINANCIAL      STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**18**
**.      Segment Reporting - (continued)**

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | **Nine                Months Ended September 30, 2005** |      |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------|-----------|
| **                                                                                                                          ** |   | **Mortgage****Portfolio****Management****Segment**           |      | **Mortgage****Lending****Segment** |   | **Total** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | (dollar                amounts in thousands)                 |      |
| **Revenue:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                         |      |   |   |   |   |
| Interest                income:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                                         |      |   |   |   |   |
| Investment                securities and loans held in securitization                trusts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | $                                                            | 40,523    |   | $ | — |   | $ | 40,523 |   |
| Loans                held for investment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                                                         | 5,388     |   |   | — |   |   | 5,388 |   |
| Loans                held for sale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                         | —   |   |   | 10,573 |   |   | 10,573 |   |
| Total                interest income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                                         | 45,911    |   |   | 10,573 |   |   | 56,484 |   |
| Interest                expense:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                         |      |   |   |   |   |   |   |   |
| Investment                securities and loans held in securitization trusts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                         | 30,090    |   |   | — |   |   | 30,090 |   |
| Loans                held for investment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                                                         | 3,911     |   |   | — |   |   | 3,911 |   |
| Loans                held for sale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                         | —   |   |   | 7,284 |   |   | 7,284 |   |
| Subordinated                debentures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                         | —   |   |   | 1,095 |   |   | 1,095 |   |
| Total                interest expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                         | 34,001    |   |   | 8,379 |   |   | 42,380 |   |
| Net                interest income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                         | 11,910    |   |   | 2,194 |   |   | 14,104 |   |
| **Other                Income:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                         |      |   |   |   |   |   |   |   |
| Gain                on sales of mortgage loans                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                                                         | —   |   |   | 21,634 |   |   | 21,634 |   |
| Brokered                loan fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                                         | —   |   |   | 7,181 |   |   | 7,181 |   |
| Gain                on sale of securities and related hedges                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                         | 2,207     |   |   | — |   |   | 2,207 |   |
| Miscellaneous                income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                                                         | 1         |   |   | 194 |   |   | 195 |   |
| Total                other income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                                         | 2,208     |   |   | 29,009 |   |   | 31,217 |   |
| **Expenses:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                                         |      |   |   |   |   |   |   |   |
| Salaries                and benefits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                                         | 1,649     |   |   | 22,226 |   |   | 23,875 |   |
| Brokered                loan expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                         | —   |   |   | 5,689 |   |   | 5,689 |   |
| Occupancy                and equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                         | 18        |   |   | 4,963 |   |   | 4,981 |   |
| Marketing                and promotion                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                         | 109       |   |   | 3,791 |   |   | 3,900 |   |
| Data                processing and communication                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                         | 103       |   |   | 1,704 |   |   | 1,807 |   |
| Office                supplies and expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                                                         | 7         |   |   | 1,902 |   |   | 1,909 |   |
| Professional                fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                         | 360       |   |   | 2,452 |   |   | 2,812 |   |
| Travel                and entertainment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                                         | 7         |   |   | 700 |   |   | 707 |   |
| Depreciation                and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                         | 5         |   |   | 1,064 |   |   | 1,069 |   |
| Other                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                         | 269       |   |   | 815 |   |   | 1,084 |   |
| Total                expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                                         | 2,527     |   |   | 45,306 |   |   | 47,833 |   |
| **Income                (Loss) Before Income Tax Benefit**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                                         | 11,591    |   |   | (14,103 | ) |   | (2,512 | ) |
| Income                tax benefit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                                         | —   |   |   | 5,880 |   |   | 5,880 |   |
| **Net                Income (Loss)**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $                                                            | 11,591    |   | $ | (8,223 | ) | $ | 3,368 |   |
| Segment                assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                                                            | 1,553,311 |   | $ | 301,688 |   | $ | 1,854,999 |   |
| Segment                equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                                                            | 101,623   |   | $ | 5,431 |   | $ | 107,054 |   |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**18**
**.      Segment Reporting - (continued)**

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | **Three                Months Ended September 30, 2006** |      |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------|-----------|
| **                                                                                                                          ** |   | **Mortgage****Portfolio****Management****Segment**            |      | **Mortgage****Lending****Segment** |   | **Total** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | (dollar                amounts in thousands)                  |      |
| **Revenue:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                          |           |   |   |  |   |   |  |   |
| Interest                income:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                                          |           |   |   |  |   |   |  |   |
| Investment                securities and loans held in securitization trusts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   | $                                                             | 16,998    |   | $ | — |   | $ | 16,998 |   |
| Loans                held for sale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                          | —   |   |   | 3,880 |   |   | 3,880 |   |
| Total                interest income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                                          | 16,998    |   |   | 3,880 |   |   | 20,878 |   |
| Interest                expense:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                          |      |   |   |   |   |   |   |   |
| Investment                securities and loans held in securitization                trusts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                          | 15,882    |   |   | — |   |   | 15,882 |   |
| Loans                held for sale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                          | —   |   |   | 3,337 |   |   | 3,337 |   |
| Subordinated                debentures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                          | —   |   |   | 877 |   |   | 877 |   |
| Total                interest expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                          | 15,882    |   |   | 4,214 |   |   | 20,096 |   |
| Net                interest income (expense)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                          | 1,116     |   |   | (334 | ) |   | 782 |   |
| **Other                Income (Expense):**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                                          |      |   |   |   |   |   |   |   |
| Gain                on sales of mortgage loans                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                                                          | —   |   |   | 4,311 |   |   | 4,311 |   |
| Loan                losses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                                          | (52       | ) |   | (4,025 | ) |   | (4,077 | ) |
| Brokered                loan fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                                          | —   |   |   | 2,402 |   |   | 2,402 |   |
| Gain                on sale of securities and related hedges                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                          | 440       |   |   | — |   |   | 440 |   |
| Miscellaneous                income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                                                          | —   |   |   | 43 |   |   | 43 |   |
| Total                other income (expense)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                                                          | 388       |   |   | 2,731 |   |   | 3,119 |   |
| **Expenses:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                                          |      |   |   |   |   |   |   |   |
| Salaries                and benefits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                                          | 167       |   |   | 5,211 |   |   | 5,378 |   |
| Brokered                loan expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                          | —   |   |   | 1,674 |   |   | 1,674 |   |
| Occupancy                and equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                          | —   |   |   | 1,256 |   |   | 1,256 |   |
| Marketing                and promotion                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                          | 21        |   |   | 406 |   |   | 427 |   |
| Data                processing and communication                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                          | 58        |   |   | 466 |   |   | 524 |   |
| Office                supplies and expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                                                          | —   |   |   | 426 |   |   | 426 |   |
| Professional                fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                          | 82        |   |   | 716 |   |   | 798 |   |
| Travel                and entertainment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                                          | 2         |   |   | 124 |   |   | 126 |   |
| Depreciation                and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                          | —   |   |   | 539 |   |   | 539 |   |
| Other                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                          | (51       | ) |   | 587 |   |   | 536 |   |
| Total                expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                                          | 279       |   |   | 11,405 |   |   | 11,684 |   |
| **Income                (Loss) Before Income Tax Benefit**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                                          | 1,225     |   |   | (9,008 | ) |   | (7,783 | ) |
| Income                tax benefit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                                          | —   |   |   | 3,915 |   |   | 3,915 |   |
| **Net                Income (Loss)**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $                                                             | 1,225     |   | $ | (5,093 | ) | $ | (3,868 | ) |
| Segment                assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                                                             | 1,163,802 |   | $ | 288,033 |   | $ | 1,451,835 |   |
| Segment                equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                                                             | 59,012    |   | $ | 21,731 |   | $ | 80,743 |   |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**18**
**.      Segment Reporting - (continued)**

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | **Three                Months Ended September 30, 2005** |      |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------|-----------|
| **                                                                                                                          ** |   | **Mortgage****Portfolio****Management****Segment**            |      | **Mortgage****Lending****Segment** |   | **Total** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | (dollar                amounts in thousands)                  |      |
| **Revenue:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                          |           |   |   |  |   |   |  |   |
| Interest                income:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                                          |           |   |   |  |   |   |  |   |
| Investment                securities and loans held in securitization                trusts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   | $                                                             | 13,442    |   | $ | — |   | $ | 13,442 |   |
| Loans                held for investment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                                                          | 1,783     |   |   | — |   |   | 1,783 |   |
| Loans                held for sale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                          | —   |   |   | 4,473 |   |   | 4,473 |   |
| Total                interest income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                                          | 15,225    |   |   | 4,473 |   |   | 19,698 |   |
| Interest                expense:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                          |           |   |   |  |   |   |  |   |
| Investment                securities and loans held in securitization trusts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                          | 10,751    |   |   | — |   |   | 10,751 |   |
| Loans                held for investment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                                                          | 1,366     |   |   | — |   |   | 1,366 |   |
| Loans                held for sale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                          | —   |   |   | 3,441 |   |   | 3,441 |   |
| Subordinated                debentures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                          | —   |   |   | 601 |   |   | 601 |   |
| Total                interest expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                          | 12,117    |   |   | 4,042 |   |   | 16,159 |   |
| Net                interest income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                                          | 3,108     |   |   | 431 |   |   | 3,539 |   |
| **Other                Income:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                          |      |   |   |   |   |   |   |   |
| Gain                on sales of mortgage loans                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                                                          | —   |   |   | 8,985 |   |   | 8,985 |   |
| Brokered                loan fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                                          | —   |   |   | 2,647 |   |   | 2,647 |   |
| Gain                on sale of securities and related hedges                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                          | 1,286     |   |   | — |   |   | 1,286 |   |
| Miscellaneous                income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |                                                          | —   |   |   | 91 |   |   | 91 |   |
| Total                other income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                                          | 1,286     |   |   | 11,723 |   |   | 13,009 |   |
| **Expenses:**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                                          |      |   |   |   |   |   |   |   |
| Salaries                and benefits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                                          | 170       |   |   | 7,132 |   |   | 7,302 |   |
| Brokered                loan expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                          | —   |   |   | 1,483 |   |   | 1,483 |   |
| Occupancy                and equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                          | 9         |   |   | 1,256 |   |   | 1,265 |   |
| Marketing                and promotion                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                                                          | 24        |   |   | 1,286 |   |   | 1,310 |   |
| Data                processing and communication                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                          | 39        |   |   | 579 |   |   | 618 |   |
| Office                supplies and expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |                                                          | 4         |   |   | 647 |   |   | 651 |   |
| Professional                fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                                          | 215       |   |   | 751 |   |   | 966 |   |
| Travel                and entertainment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                                                          | 3         |   |   | 258 |   |   | 261 |   |
| Depreciation                and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                                          | 2         |   |   | 300 |   |   | 302 |   |
| Other                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                                          | 133       |   |   | 398 |   |   | 531 |   |
| Total                expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                                          | 599       |   |   | 14,090 |   |   | 14,689 |   |
| **Income                (Loss) Before Income Tax Benefit**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                                                          | 3,795     |   |   | (1,936 | ) |   | 1,859 |   |
| Income                tax benefit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                                                          | —   |   |   | 1,000 |   |   | 1,000 |   |
| **Net                Income (Loss)**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $                                                             | 3,795     |   | $ | (936 | ) | $ | 2,859 |   |
| Segment                assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                                                             | 1,553,311 |   | $ | 301,688 |   | $ | 1,854,999 |   |
| Segment                equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                                                             | 101,623   |   | $ | 5,431 |   | $ | 107,054 |   |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**19**
**.      Stock Incentive Plan**

***2005      Stock Incentive Plan***

***Options***

|                                                                                                                                                                                                                                                                                                                |   | **Number                of****Options** |    | **Weighted****Average****Exercise****Price** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------|---------|----------------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                |   |                                    |    |                                    |   |
| Outstanding                at beginning of year, January 1,                2006                                       |   |                                    | 541,500 |                                         | $      | 9.56 |   |
| Granted                                                                                                                                                                                                                                                                                                             |   |                                    | — |                                         |   | — |   |
| Forfeited                                                                                                                                                                                                                                                                                                           |   |                                    | (75,000 | )                                            |   | 9.83 |   |
| Exercised                                                                                                                                                                                                                                                                                                           |   |                                    | — |                                         |   | — |   |
| Outstanding                as of September 30, 2006                                                                                                                                                                                                                                                                 |   |                                    | 466,500 |                                         | $      | 9.52 |   |
| Options                exercisable as of September 30, 2006                                                                                                                                                                                                                                                         |   |                                    | 369,833 |                                         | $      | 9.43 |   |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**19**
**.      Stock Incentive Plan - (continued)**

|                                        |   | **Options                Outstanding** |    | **Options                Exercisable**                                                    |   |                   |   |
|---------------------------------------------|--------|----------------------------------------|---------|-------------------------------------------------------------------------------------------|--------|-----------------------------|--------|
| **Range                of Exercise Prices** |   | **Number****Outstanding**              |    |  **Weighted-****Average****Remaining****Contractual****Life                (Years)** |   |  **Exercise****Price** |   | **Number****Exercisable** |   |  **Exercise****Price** |   |  **Fair                Value****of                Options****Granted** |   |
|                                        |   |                                   |    |                                                                                      |   |                   |   |   |   |    |   |    |   |
| $9.00                                       |   |                                   | 176,500 |                                                                                      |   | 7.7                         |   | $ | 9.00 |   |   | 176,500 |   | $ | 9.00 |   | $ | 0.39 |   |
| $9.83                                       |   |                                   | 290,000 |                                                                                      |   | 8.2                         |   |   | 9.83 |   |   | 193,333 |   |   | 9.83 |   |   | 0.29 |   |
| Total/Weighted                Average       |   |                                   | 466,500 |                                                                                      |   | 8.0                         |   | $ | 9.52 |   |   | 369,833 |   | $ | 9.43 |   | $ | 0.34 |   |

| Risk-free                interest rate                                                                                                                                                                                                                                                                                                                                                          |      | 4.5   | %     |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------|-------|-------|
| Expected                volatility                                                                                                                                                                                                                                                                                                                                                              |                     | 10    | %     |
| Expected                life                                                                                                                                                                                                                                                                                                                                                                    |                     | 10    | years |
| Expected                dividend                yield                                                        |                     | 10.48 | %     |

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**19**
**.      Stock Incentive Plan - (continued)**

***Restricted      Stock***

|                                                                                     |   | **Number                of****Non-vested****Restricted****Shares** |     | **Weighted****Average****Grant                Date****Fair                Value** |   |
|------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------|----------|-----------------------------------------------------------------------------------|--------|
|                                                                                     |   |                                                          |     |                                                                         |   |
| Non-vested                shares at beginning of year, January 1, 2006                   |   |                                                               | 221,058  |                                                                              | $      | 9.33 |   |
| Granted                                                                                  |   |                                                               | 129,155  |                                                                              |   | 4.36 |   |
| Forfeited                                                                                |   |                                                               | —  |                                                                              |   | — |   |
| Vested                                                                                   |   |                                                               | (100,002 | )                                                                                 |   | 8.15 |   |
| Non-vested                shares as of September 30, 2006                                |   |                                                               | 250,211  |                                                                              | $      | 7.24 |   |
| Weighted-average                fair value of restricted stock granted during the period |   | $                                                                  | 562,549  |                                                                              | $      | 4.36 |   |

***Performance      Based Stock Awards***

----

**N**
**EW      YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES**

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**September      30, 2006 **

**(unaudited)**

**19**
**.      Stock Incentive Plan - (continued)**

|                                                                   |   | **Number                of****Non-vested****Performance****Shares** |    | **Weighted****Average****Grant                Date****Fair                Value** |   |
|------------------------------------------------------------------------|--------|---------------------------------------------------------------------|---------|-----------------------------------------------------------------------------------|--------|
|                                                                   |   |                                                           |    |                                                                         |   |
| Non-vested                shares at beginning of year, January 1, 2006 |   |                                                                | 61,078  |                                                                              | $      | 9.83 |   |
| Granted                                                                |   |                                                                | — |                                                                              |   | — |   |
| Forfeited                                                              |   |                                                                | (26,271 | )                                                                                 |   | 9.83 |   |
| Vested                                                                 |   |                                                                | (6,995  | )                                                                                 |   | 9.83 |   |
| Non-vested                shares as of September 30, 2006              |   |                                                                | 27,812  |                                                                              | $      | 9.83 |   |

----

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

**CAUTIONARY      NOTE REGARDING FORWARD-LOOKING STATEMENTS**

|   | · | our                business strategy; |
|--------|--------|---------------------------------------|

|   | · | future                performance, developments, market forecasts or projected                dividends; |
|--------|--------|----------------------------------------------------------------------------------------------------------|

|   | · | projected                acquisitions or joint ventures; and |
|--------|--------|--------------------------------------------------------------|

|   | · | projected                capital expenditures. |
|--------|--------|------------------------------------------------|

|   | · | our                limited operating history with respect to our portfolio                strategy; |
|--------|--------|-----------------------------------------------------------------------------------------------------|

|   | · | our                proposed portfolio strategy may be changed or modified by our management                without advance notice to stockholders, and that we may suffer losses                as a                result of such modifications or                changes; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | impacts                of a change in demand for mortgage loans on our net income and cash                available for distribution; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our                ability to originate prime and high-quality adjustable-rate and hybrid                mortgage loans for our portfolio; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | risks                associated with the use of                leverage; |
|--------|--------|--------------------------------------------------------------------------|

|   | · | interest                rate mismatches between our mortgage-backed securities and our borrowings                used to fund such purchases; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | changes                in interest rates and mortgage prepayment                rates; |
|--------|--------|----------------------------------------------------------------------------------------|

|   | · | effects                of interest rate caps on our adjustable-rate mortgage-backed                securities; |
|--------|--------|----------------------------------------------------------------------------------------------------------------|

|   | · | the                degree to which our hedging strategies may or may not protect us                from                interest rate volatility; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | potential                impacts of our leveraging policies on our net income and cash available                for distribution; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------|

|   | · | our                board’s ability to change our operating policies and strategies without                notice to you or stockholder                approval; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the                other important factors identified, or incorporated by reference                into this                report, including, but not limited to those under the captions                “Management’s Discussion and Analysis of Financial Condition and Results                of Operations” and “Quantitative and Qualitative Disclosures about Market                Risk”, and those described under the caption “Part I. Item 1A. Risk                Factors” in our Annual Report on Form 10-K filed with the Securities and                Exchange Commission on March 16,                2006. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**General**

**Strategic      Overview**

*Funding      Diversification.*

----

*Risk      Management.*

*High      Credit Quality Investment Portfolio.*

*Interest      Rate Risk Management.*

*Other      Risk Considerations:*

|   | · | a                decline in the market value of our assets due to rising interest                rates; |
|--------|--------|---------------------------------------------------------------------------------------------------------|

|   | · | an                adverse impact on our earnings from a decrease in the demand for                mortgage                loans due to, among other things, a period of rising interest                rates; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our                ability to originate prime adjustable-rate and hybrid mortgage loans                for                our portfolio; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | increasing                or decreasing levels of prepayments on the mortgages underlying our                mortgage-backed securities; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our                ability to obtain financing to fund and hold mortgage loans prior                to their                sale or securitization; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the                overall leverage of our portfolio and the ability to obtain financing                to                leverage our equity; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the                potential for increased borrowing costs and its impact on net                income; |
|--------|--------|---------------------------------------------------------------------------------------------------------|

|   | · | the                concentration of our mortgage loans in specific geographic                regions; |
|--------|--------|-------------------------------------------------------------------------------------------------------|

|   | · | our                ability to use hedging instruments to mitigate our interest rate                and                prepayment risks; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a                prolonged economic slow down, a lengthy or severe recession or declining                real estate values could harm our                operations; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | if                our assets are insufficient to meet the collateral requirements of                our                lenders, we might be compelled to liquidate particular assets at                inopportune times and at disadvantageous                prices; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | if                we are disqualified as a REIT, we will be subject to tax as a regular                corporation and face substantial tax liability;                and |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | compliance                with REIT requirements might cause us to forgo otherwise attractive                opportunities. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------|

**Description      of Businesses**

***Mortgage      Lending***

----

**Mortgage      Portfolio Management**

|   | · | invest                in assets generated from our self-origination of high-credit quality,                single-family, residential mortgage                loans; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | invest                in mortgage-backed securities originated by others, including ARM                securities and collateralized mortgage obligation floaters (“CMO                Floaters”); |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | generally                operate as a long-term portfolio                investor; |
|--------|--------|------------------------------------------------------------------------------------|

|   | · | finance                our portfolio by entering into repurchase agreements and as we aggregate                mortgage loans for investment, issuing mortgage-backed bonds from                time to                time; and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | generate                earnings from the return on our mortgage securities and spread income                from                our mortgage loan portfolio. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Known      Material Trends and Commentary**

| **Total                U.S. 1-to-4-Family Mortgage Originations **                                                                                                                                                                                                                                                           |                           | **2005**                                    |   | **2006****Forecast**           |   | **Forecasted****Percentage****Change** |                           |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|---------------------------------------------|--------|--------------------------------|--------|----------------------------------------|--------------------------------|
|                                                                                                                                                                                                                                                                                                                              |       | (dollar                amounts in billions) |   |
|                                                                                                                                                                                                                                                                                                                              |                           |                                        |   |       |   |                                   |       |   |   |   |
| Purchase                mortgages                                                 |                           | $                                           | 1,513  |                           | $      | 1,392                                  |                           |   | (8.0 | )% |
| Refinancings                                                                                                                                                                                                                                                                                                                      |                           |                                        | 1,514  |                           |   | 1,070                                  |                           |   | (29.3 | )% |
| Total                                                                                                                                                                                                                                                                                                                             |                           | $                                           | 3,027  |                           | $      | 2,462                                  |                           |   | (18.7 | )% |

*Source:      October 24, 2006 Mortgage Finance Forecast of the MBA*

**Our      Total Mortgage Originations**

|                                                                                                                                                                                                                                                                                                                                         |                           | **NYMC                Total****Mortgage****Originations** |    | **Percentage****Change****From                Prior Year** |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|-----------------------------------------------------------|---------|------------------------------------------------------------|--------|
| **2005**                                                                                                                                                                                                                                                                                                                                     |                           | **2006**                                                  |
|                                                                                                                                                                                                                                                                                                                                         |                           | (dollar                amounts in millions)               |    |
|                                                                                                                                                                                                                                                                                                                                         |                           |                                                      |    |                                                       |   |   |   |   |   |
| 1st                Quarter                                                                                                                                                                                                                                                                                                                   |       | $                                                         | 672.5   |                                   | $      | 613.8 |       | (8.7 | )% |
| 2nd                Quarter                                                    |                           |                                                      | 939.7   |                                                       |   | 741.8 |   | (21.1 | )% |
| 3rd                Quarter                                                                                                                                                                                                                                                                                                                   |                           |                                                      | 1,002.2 |                                                       |   | 602.8 |   | (39.9 | )% |
| 4th                Quarter                                                                                                                                                                                                                                                                                                                   |                           |                                                      | 822.9   |                                                       |   |   |   |   |   |
| Full                Year                                                                                                                                                                                                                                                                                                                     |                           | $                                                         | 3,437.3 |                                                       |   |   |   |   |   |

----

**Our      Total Purchase Mortgage Originations**

|                                                                                                                                                                                                                                                                                                                                           |                           | **NYMC                  Total Refinance****Mortgage                  Originations** |    | **Percentage****Change****From Prior                  Year** |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|-------------------------------------------------------------------------------------|---------|-------------------------------------------------------------------|--------|
| **2005**                                                                                                                                                                                                                                                                                                                                       |                           | **2006**                                                                            |
|                                                                                                                                                                                                                                                                                                                                           |                           | (dollar                  amounts in millions)                                       |    |
|                                                                                                                                                                                                                                                                                                                                           |                           |                                                                                |    |                                                              |   |   |   |   |   |
| 1st                  Quarter                                                                                                                                                                                                                                                                                                                   |       | $                                                                                   | 381.0   |                                          | $      | 348.2 |       | (8.6 | )% |
| 2nd                  Quarter                                                    |                           |                                                                                | 601.7   |                                                              |   | 453.9 |   | (24.6 | )% |
| 3rd                  Quarter                                                                                                                                                                                                                                                                                                                   |                           |                                                                                | 569.8   |                                                              |   | 364.5 |   | (36.0 | )% |
| 4th                  Quarter                                                                                                                                                                                                                                                                                                                   |                           |                                                                                | 432.9   |                                                              |   |   |   |   |   |
| Full                  Year                                                                                                                                                                                                                                                                                                                     |                           | $                                                                                   | 1,985.4 |                                                              |   |   |   |   |   |

**Our      Total Refinance Mortgage Originations**

|                                                                                                                                                                                                                                                                                                                                         |                           | **NYMC                Total Refinance****Mortgage                Originations** |    | **Percentage****Change****From Prior                Year** |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|---------------------------------------------------------------------------------|---------|-----------------------------------------------------------------|--------|
| **2005**                                                                                                                                                                                                                                                                                                                                     |                           | **2006**                                                                        |
|                                                                                                                                                                                                                                                                                                                                         |                           | (dollar                amounts in millions)                                     |    |
|                                                                                                                                                                                                                                                                                                                                         |                           |                                                                            |    |                                                            |   |   |   |   |   |
| 1st                Quarter                                                                                                                                                                                                                                                                                                                   |       | $                                                                               | 291.5   |                                        | $      | 265.6 |       | (8.9 | )% |
| 2nd                Quarter                                                    |                           |                                                                            | 338.0   |                                                            |   | 287.9 |   | (14.8 | )% |
| 3rd                Quarter                                                                                                                                                                                                                                                                                                                   |                           |                                                                            | 432.4   |                                                            |   | 238.3 |   | (44.9 | )% |
| 4th                Quarter                                                                                                                                                                                                                                                                                                                   |                           |                                                                            | 390.0   |                                                            |   |   |   |   |   |
| Full                Year                                                                                                                                                                                                                                                                                                                     |                           | $                                                                               | 1,451.9 |                                                            |   |   |   |   |   |

*Liquidity.*

----

**Significance      of Estimates and Critical Accounting Policies**

*Revenue      Recognition.*

*Fair      Value.*

*Impairment      of and Basis Adjustments on Securitized Financial Assets.*

----

*Loan      Loss Reserves on Mortgage Loans.*

*Loan      Losses*

*Securitizations.*

|   | · | creating                securities backed by mortgage loans which we will continue to hold                and                finance that will be more liquid than holding whole loan assets;                or |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | securing                long-term collateralized financing for our residential mortgage loan                portfolio and matching the income earned on residential mortgage                loans                with the cost of related liabilities, otherwise referred to as match                funding our balance sheet. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

*Accounting      for Transfers and Servicing of Financial Assets and Extinguishments of      Liabilities*

*Consolidation      of Variable Interest Entities*

*Derivative      Financial Instruments*

----

*New      Accounting Pronouncements*

----

**Overview      of Performance**

**Summary      of Operations and Key Performance Measurements**

|                                                                         |   | **Amount**                                                                                                                                           |   | **Average****Outstanding****Balance**                                                                                                                |   | **Effective****Rate**                                                                                                                                |   |
|------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                         |   |                                                                                                                                                 |   | ($                in millions)                                                                                                                       |   |                                                                                                                                                 |   |
| **Interest                Income Components:**                               |   | **                        ** |   | **                        ** |   | **                        ** |   |
| **Interest                Income**                                           |   |                                                                                                                                                 |   |                                                                                                                                                 |   |                                                                                                                                                 |   |
| Investment                securities and loans held in securitization trusts |   | $                                                                                                                                                    | 51.7   |                                                                                                                                                 | $      | 1,326.2                                                                                                                                              |   |   | 5.20 | % |
| Amortization                of premium                                       |   |                                                                                                                                                 | (1.6   | )                                                                                                                                                    |   | —                                                                                                                                              |   |   | (0.16 | )% |
| **Total                Interest Income**                                     |   | $                                                                                                                                                    | 50.1   |                                                                                                                                                 | $      | 1,326.2                                                                                                                                              |   |   | 5.04 | % |
| **Interest                Expense**                                          |   |                                                                                                                                                 |        |                                                                                                                                                 |   |                                                                                                                                                      |   |   |  |   |
| Repurchase                agreements                                         |   | $                                                                                                                                                    | 47.6   |                                                                                                                                                 | $      | 1,248.1                                                                                                                                              |   |   | 5.03 | % |
| Interest                rate swaps and caps                                  |   |                                                                                                                                                 | (5.2   | )                                                                                                                                                    |   | —                                                                                                                                              |   |   | (0.56 | )% |
| **Total                Interest Expense**                                    |   | $                                                                                                                                                    | 42.4   |                                                                                                                                                 | $      | 1,248.1                                                                                                                                              |   |   | 4.47 | % |
| **Net                Interest Income**                                       |   | $                                                                                                                                                    | 7.7    |                                                                                                                                                 |   |                                                                                                                                                      |   |   | 0.57 | % |

|                                                                         |   | **Amount** |   | **Average****Outstanding****Balance** |   | **Effective****Rate** |   |
|------------------------------------------------------------------------------|--------|------------|--------|---------------------------------------|--------|-----------------------|--------|
|                                                                         |   |       |   | ($                in millions)        |   |                  |   |
| **Interest                Income Components:**                               |   |       |   |                                  |   |                  |   |
| **Interest                Income**                                           |   |       |   |                                  |   |                  |   |
| Investment                securities and loans held in securitization trusts |   | $          | 17.6   |                                  | $      | 1,287.6               |   |   | 5.50 | % |
| Amortization                of premium                                       |   |       | (0.6   | )                                     |   | —               |   |   | (0.22 | )% |
| **Total                Interest Income**                                     |   | $          | 17.0   |                                  | $      | 1,287.6               |   |   | 5.28 | % |
| **Interest                Expense**                                          |   |       |        |                                  |   |                       |   |   |  |   |
| Repurchase                agreements                                         |   | $          | 17.0   |                                  | $      | 1,214.0               |   |   | 5.48 | % |
| Interest                rate swaps and caps                                  |   |       | (1.1   | )                                     |   | —               |   |   | (0.36 | )% |
| **Total                Interest Expense**                                    |   | $          | 15.9   |                                  | $      | 1,214.0               |   |   | 5.12 | % |
| **Net                Interest Income**                                       |   | $          | 1.1    |                                  |   |                       |   |   | 0.16 | % |

----

|   | · | net                interest spread on the portfolio; |
|--------|--------|------------------------------------------------------|

|   | · | characteristics                of the investments and the underlying pool of mortgage loans including                but                not limited to credit quality, coupon and prepayment rates;                and |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | return                on our mortgage asset investments and the related management of interest                rate risk. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------|

| **Description**                                                                                                                                                                                                                                                                                                                             |   | **Number****of                Loans** |   | **Aggregate****Principal****Balance** |   | **Percentage****of                Total****Principal** |   | **Weighted****Average****Interest****Rate** |   |   | **Average****Loan                Size** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|--------|---------------------------------------|--------|--------------------------------------------------------|--------|---------------------------------------------|--------|--------|-----------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                        |   |                             |   | ($                in millions)        |   |                                              |   |                                   |   |   |                               |   |
|                                                                                                                                                                                                                                                                                                                                        |   |                             |   |                             |   |                                              |   |                                   |   |   |                               |   |
| Purchase                mortgages                                                                                                                                                                                                                                                                                                           |   |                                  | 5,064  |                                  | $      | 1,166.7                                                |   |                                        | 59.6   | %      |                                    | 7.14   | % |   | $ | 230,388 |   |
| Refinancings                                                                                                                                                                                                                                                                                                                                |   |                                  | 2,919  |                                  |   | 791.7                                                  |   |                                        | 40.4   | %      |                                    | 6.96   | % |   |   | 271,229 |   |
| Total                                                                                                                                                                                                                                                                                                                                       |   |                                  | 7,983  |                                  | $      | 1,958.4                                                |   |                                        | 100.0  | %      |                                    | 7.07   | % |   |   | 245,322 |   |
| Adjustable                rate or                hybrid                                               |   |                                  | 2,751  |                                  | $      | 884.0                                                  |   |                                        | 45.1   | %      |                                    | 6.91   | % |   |   | 321,340 |   |
| Fixed                rate                                                                                                                                                                                                                                                                                                                   |   |                                  | 5,232  |                                  |   | 1,074.4                                                |   |                                        | 54.9   | %      |                                    | 7.20   | % |   |   | 205,351 |   |
| Total                                                                                                                                                                                                                                                                                                                                       |   |                                  | 7,983  |                                  | $      | 1,958.4                                                |   |                                        | 100.0  | %      |                                    | 7.07   | % |   |   | 245,322 |   |
| Bankered                                                                                                                                                                                                                                                                                                                                    |   |                                  | 6,128  |                                  | $      | 1,402.5                                                |   |                                        | 71.6   | %      |                                    | 7.18   | % |   |   | 228,860 |   |
| Brokered                                                                                                                                                                                                                                                                                                                                    |   |                                  | 1,855  |                                  |   | 555.9                                                  |   |                                        | 28.4   | %      |                                    | 6.79   | % |   |   | 299,701 |   |
| Total                                                                                                                                                                                                                                                                                                                                       |   |                                  | 7,983  |                                  | $      | 1,958.4                                                |   |                                        | 100.0  | %      |                                    | 7.07   | % |   | $ | 245,322 |   |

| **Description**                                                                                                                                                                                                                                                                                                                             |   | **Number****of                Loans** |   | **Aggregate****Principal****Balance** |   | **Percentage****of                Total****Principal** |   | **Weighted****Average****Interest****Rate** |   |   | **Average****Loan                Size** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|--------|---------------------------------------|--------|--------------------------------------------------------|--------|---------------------------------------------|--------|--------|-----------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                        |   |                             |   | ($                in millions)        |   |                                              |   |                                   |   |   |                               |   |
|                                                                                                                                                                                                                                                                                                                                        |   |                             |   |                             |   |                                              |   |                                   |   |   |                               |   |
| Purchase                mortgages                                                                                                                                                                                                                                                                                                           |   |                                  | 1,664  |                                  | $      | 364.5                                                  |   |                                        | 60.5   | %      |                                    | 7.44   | % |   | $ | 219,079 |   |
| Refinancings                                                                                                                                                                                                                                                                                                                                |   |                                  | 924    |                                  |   | 238.3                                                  |   |                                        | 39.5   | %      |                                    | 7.27   | % |   |   | 257,858 |   |
| Total                                                                                                                                                                                                                                                                                                                                       |   |                                  | 2,588  |                                  | $      | 602.8                                                  |   |                                        | 100.0  | %      |                                    | 7.38   | % |   |   | 232,925 |   |
| Adjustable                rate or                hybrid                                               |   |                                  | 797    |                                  | $      | 238.8                                                  |   |                                        | 39.6   | %      |                                    | 7.27   | % |   |   | 299,678 |   |
| Fixed                rate                                                                                                                                                                                                                                                                                                                   |   |                                  | 1,791  |                                  |   | 364.0                                                  |   |                                        | 60.4   | %      |                                    | 7.45   | % |   |   | 203,220 |   |
| Total                                                                                                                                                                                                                                                                                                                                       |   |                                  | 2,588  |                                  | $      | 602.8                                                  |   |                                        | 100.0  | %      |                                    | 7.38   | % |   |   | 232,925 |   |
| Bankered                                                                                                                                                                                                                                                                                                                                    |   |                                  | 2,067  |                                  | $      | 462.3                                                  |   |                                        | 76.7   | %      |                                    | 7.41   | % |   |   | 223,658 |   |
| Brokered                                                                                                                                                                                                                                                                                                                                    |   |                                  | 521    |                                  |   | 140.5                                                  |   |                                        | 23.3   | %      |                                    | 7.27   | % |   |   | 269,691 |   |
| Total                                                                                                                                                                                                                                                                                                                                       |   |                                  | 2,588  |                                  | $      | 602.8                                                  |   |                                        | 100.0  | %      |                                    | 7.38   | % |   | $ | 232,925 |   |

|   | · | dollar                volume of mortgage loans                originated; |
|--------|--------|---------------------------------------------------------------------------|

----

|   | · | relative                cost of the loans originated; |
|--------|--------|-------------------------------------------------------|

|   | · | characteristics                of the loans, including but not limited to the coupon and credit                quality                of the loan, which will indicate their expected yield;                and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | return                on our mortgage asset investments and the related management of interest                rate risk. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------|

**Three      Months Ended **
**September 30,      2006 Financial Highlights:**

|   | · | Net                income for the Company’s Mortgage Portfolio Management segment totaled                $1.2 million. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------|

|   | · | Consolidated                net loss totaled $3.9 million. |
|--------|--------|-----------------------------------------------------------------|

|   | · | The                Company recognized loan losses of $4.1                million. |
|--------|--------|-----------------------------------------------------------------------------------|

|   | · | Declared                a third quarter 2006 cash dividend of $0.14 per common share payable                on                October 26, 2006 to stockholders of record as of October 6,                2006. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Financial      Condition**

**Balance      Sheet Analysis **
**-      Asset Quality**

***Investment      Portfolio Related Assets***

*Mortgage      Loans Held in Securitization Trusts and Mortgage Loans Held for      Investment.*

|   | · | New                York Mortgage Trust 2005-1 (“NYMT 2005-1”), February 25, 2005;                $419.0 million of loans |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | New                York Mortgage Trust 2005-2 (“NYMT 2005-2), July 28, 2005;                $242.9 million of loans |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------|

|   | · | New                York Mortgage Trust 2005-3 (“NYMT 2005-3), December 20, 2005;                $235.0 million of loans |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

| **Category**                                                |                           | **Par                Value** |                                                         | **Coupon**                     |   | **Carrying                Value**                                                                |                           | **Yield** |    |
|-------------------------------------------------------------|--------------------------------|------------------------------|--------------------------------------------------------------|--------------------------------|--------|--------------------------------------------------------------------------------------------------|--------------------------------|-----------|---------|
|                                                        |       |                         |            |       |   |                  |       |      |    |       |   |   |   |
| Mortgage                Loans Held in Securitization Trusts |                           | $                            | 624,528                                                      |                           |   | 5.31                                                                                             | %                              | $         | 628,625 |   |   | 6.00 | % |

----

**Characteristics      of Our Mortgage Loans Held in Securitization Trusts (dollar amounts in      thousands):**

|                                                        |                           | **#                of Loans** |                           | **Par                Value** |                           | **Carrying                Value** |   |
|-------------------------------------------------------------|--------------------------------|-------------------------------|--------------------------------|------------------------------|--------------------------------|-----------------------------------|--------|
|                                                        |       |                          |       |                         |       |                              |   |
| Mortgage                loans held in securitization trusts |                           |                          | 1,346                          |                         | $                              | 624,528                           |   | $ | 628,625 |   |
| Mortgage                loans sold in REMIC trusts          |                           |                          | 470                            |                         |                           | 257,879                           |   |   | — |   |
| Total                loans with credit risk exposure        |                           |                          | 1,816                          |                         | $                              | 882,407                           |   | $ | 628,625 |   |

|                                            |   |  **Average**                                                              |   | **High**                                                           |   | **Low**                                                      |   |
|-------------------------------------------------|--------|--------------------------------------------------------------------------------|--------|--------------------------------------------------------------------|--------|--------------------------------------------------------------|--------|
|                                            |   |               |   |             |   |            |   |
| **General                Loan Characteristics** |   |                                                                      |   |                                                          |   |                                                    |   |
| Original                Loan Balance            |   | $                                                                              | 499    |                                                               | $      | 3,500                                                        |   | $ | 25 |   |
| Coupon                Rate                      |   |                                                                           | 5.60   | %                                                                  |   | 8.13                                                         | %      |   | 3.00 | % |
| Gross                Margin                     |   |                                                                           | 2.36   | %                                                                  |   | 7.01                                                         | %      |   | 1.13 | % |
| Lifetime                Cap                     |   |                                                                           | 11.13  | %                                                                  |   | 13.75                                                        | %      |   | 9.00 | % |
| Original                Term (Months)           |   |                                                                           | 360    |                                                               |   | 360                                                          |   |   | 360 |   |
| Remaining                Term (Months)          |   |                                                                           | 344    |                                                               |   | 354                                                          |   |   | 310 |   |

|                                                           |   | **  Percentage  ** |   |
|----------------------------------------------------------------|--------|----------------------------------------|--------|
|                                                           |   |                                   |   |
| **Arm Loan                Type **                    |   |                                   |   |
| Traditional                ARMs                                |   | 3.0                                    | %      |
| 2/1                Hybrid ARMs                                 |   | 3.9                                    | %      |
| 3/1                Hybrid ARMs                                 |   | 18.9                                   | %      |
| 5/1                Hybrid ARMs                                 |   | 72.3                                   | %      |
| 7/1                Hybrid ARMs                                 |   | 1.9                                    | %      |
| Total                                                          |   | 100.0                                  | %      |
| Percent                of ARM loans that are interest only     |   | 75.3                                   | %      |
| Weighted                average length of interest only period |   | 7.9                years               |   |

|                                                |   | **  Percentage  ** |   |
|-----------------------------------------------------|--------|----------------------------------------|--------|
|                                                |   |                                   |   |
| **Traditional                ARMs - Periodic Caps** |   |                                   |   |
| None                                                |   | 62.2                                   | %      |
| 1%                                                  |   | 10.6                                   | %      |
| Over                1%                              |   | 27.2                                   | %      |
| Total                                               |   | 100.0                                  | %      |

|                                         |   | **  Percentage  ** |   |
|----------------------------------------------|--------|----------------------------------------|--------|
|                                         |   |                                   |   |
| **Hybrid                ARMs - Initial Cap** |   |                                   |   |
| 3.00%                or less                 |   | 17.0                                   | %      |
| 3.01%-4.00%                                  |   | 7.5                                    | %      |
| 4.01%-5.00%                                  |   | 74.4                                   | %      |
| 5.01%-6.00%                                  |   | 1.1                                    | %      |
| Total                                        |   | 100.0                                  | %      |

----

|                              |   | **  Percentage  ** |   |
|-----------------------------------|--------|----------------------------------------|--------|
|                              |   |                                   |   |
| **FICO                Scores**    |   |                                   |   |
| 650                or less        |   | 3.9                                    | %      |
| 651                to 700         |   | 17.6                                   | %      |
| 701                to 750         |   | 34.0                                   | %      |
| 751                to 800         |   | 40.8                                   | %      |
| 801                and over       |   | 3.7                                    | %      |
| Total                             |   | 100.0                                  | %      |
| Average                FICO Score |   | 737                                    |   |

|                                   |   | **  Percentage  ** |   |
|----------------------------------------|--------|----------------------------------------|--------|
|                                   |   |                                   |   |
| **Loan                to Value (LTV)** |   |                                   |   |
| 50%                or less             |   | 9.7                                    | %      |
| 50.01%-60.00%                          |   | 8.8                                    | %      |
| 60.01%-70.00%                          |   | 28.0                                   | %      |
| 70.01%-80.00%                          |   | 51.2                                   | %      |
| 80.01%                and over         |   | 2.3                                    | %      |
| Total                                  |   | 100.0                                  | %      |
| Average                LTV             |   | 69.5                                   | %      |

|                                    |   | **  Percentage  ** |   |
|-----------------------------------------|--------|----------------------------------------|--------|
|                                    |   |                                   |   |
| **Property                Type**        |   |                                   |   |
| Single                Family            |   | 53.4                                   | %      |
| Condominium                             |   | 22.0                                   | %      |
| Cooperative                             |   | 8.5                                    | %      |
| Planned                Unit Development |   | 13.0                                   | %      |
| Two                to Four Family       |   | 3.1                                    | %      |
| Total                                   |   | 100.0                                  | %      |

|                                |   | **  Percentage  ** |   |
|-------------------------------------|--------|----------------------------------------|--------|
|                                |   |                                   |   |
| **Occupancy                Status** |   |                                   |   |
| Primary                             |   | 85.6                                   | %      |
| Secondary                           |   | 10.3                                   | %      |
| Investor                            |   | 4.1                                    | %      |
| Total                               |   | 100.0                                  | %      |

|                                       |   | **  Percentage  ** |   |
|--------------------------------------------|--------|----------------------------------------|--------|
|                                       |   |                                   |   |
| **Documentation                Type**      |   |                                   |   |
| Full                Documentation          |   | 69.5                                   | %      |
| Stated                Income               |   | 21.1                                   | %      |
| Stated                Income/Stated Assets |   | 7.9                                    | %      |
| No                Documentation            |   | 0.9                                    | %      |
| No                Ratio                    |   | 0.6                                    | %      |
| Total                                      |   | 100.0                                  | %      |

----

|                                     |   | **  Percentage  ** |   |
|------------------------------------------|--------|----------------------------------------|--------|
|                                     |   |                                   |   |
| **Loan                Purpose**          |   |                                   |   |
| Purchase                                 |   | 57.6                                   | %      |
| Cash                out refinance        |   | 25.7                                   | %      |
| Rate                & term refinance |   | 16.7                                   | %      |
| Total                                    |   | 100.0                                  | %      |

|                                                                    |   | **  Percentage  ** |   |
|-------------------------------------------------------------------------|--------|----------------------------------------|--------|
|                                                                    |   |                                   |   |
| **Geographic                Distribution: 5% or more in any one state** |   |                                   |   |
| NY                                                                      |   | 25.4                                   | %      |
| MA                                                                      |   | 14.3                                   | %      |
| CA                                                                      |   | 7.8                                    | %      |
| Other                (less than 5% individually)                        |   | 52.5                                   | %      |
| Total                                                                   |   | 100.0                                  | %      |

*Delinquency      Status*

| **Days                Late** |   | **Number                of****Delinquent ****Loans** |   | **Total****Dollar****Amount** |   | **%                of****Loan****Portfolio** |   |
|------------------------------|--------|-----------------------------------------------------------|--------|-------------------------------|--------|----------------------------------------------|--------|
|                         |   |                                                      |   |                          |   |                                         |   |
| 30-60                        |   |                                                      | 3      |                          | $      | 3,686                                        |   |   | 0.59 | % |
| 61-90                   |   |                                                      | 1      |                          |   | 193                                          |   |   | 0.03 | % |
| 90+                          |   |                                                      | 3      |                          | $      | 2,569                                        |   |   | 0.41 | % |

*Investment      Securities - Available for Sale.*

----

**Characteristics      of Our Investment Securities (dollar amounts in      thousands):**

|                                    |                           | **Sponsor                or****Rating** |                                  | **Par****Value** |                           | **Carrying****Value** |                           | **%                of****Portfolio** |                           | **Coupon** |                           | **Yield** |   |
|-----------------------------------------|--------------------------------|-----------------------------------------|---------------------------------------|------------------|--------------------------------|-----------------------|--------------------------------|--------------------------------------|--------------------------------|------------|--------------------------------|-----------|--------|
|                                    |       |                                    |              |             |       |                  |       |                                 |       |       |       |      |   |
| **Credit**                              |                           |                                    |                                  |             |                           |                  |                           |                                 |                           |       |                           |      |   |
| Agency                REMIC Floaters    |                           |                                    | FNMA/FHLMC/GNMA                       |             | $                              | 178,389               |                           | $                                    | 178,991                        |       |                           | 34        | %      |   | 6.68 | % |   | 6.56 | % |
| Private                Label Floaters   |                           |                                    | AAA                                   |             |                           | 27,574                |                           |                                 | 27,500                         |       |                           | 5         | %      |   | 6.11 | % |   | 6.28 | % |
| Private                Label ARMs       |                           |                                    | AAA                                   |             |                           | 296,201               |                           |                                 | 293,237                        |       |                           | 56        | %      |   | 4.81 | % |   | 6.03 | % |
| NYMT                Retained Securities |                           |                                    | AAA-BBB                               |             |                           | 22,342                |                           |                                 | 22,229                         |       |                           | 4         | %      |   | 5.65 | % |   | 6.47 | % |
| NYMT                Retained Securities |                           |                                    | Below                Investment Grade |             |                           | 2,769                 |                           |                                 | 2,012                          |       |                           | 1         | %      |   | 5.68 | % |   | 19.49 | % |
| Total/Weighted                Average   |                           |                                    |                                  |             | $                              | 527,275               |                           | $                                    | 523,969                        |       |                           | 100       | %      |   | 5.55 | % |   | 6.32 | % |

| **Interest                Rate Repricing**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                           | **Carrying****Value** |    | **%                of****Portfolio** |   | **Weighted****Average****Coupon** |                           |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|-----------------------|---------|--------------------------------------|--------|-----------------------------------|--------------------------------|
|                                                                                             |       |                  |    |             |   |                              |       |   |   |   |
| <                6 Months                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                           | $                     | 212,513 |                                 |   | 41                                | %                              |   | 6.60 | % |
| <                24 Months                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                           |                  | 43,703  |                                 |   | 8                                 | %                              |   | 4.91 | % |
| <                60 Months                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                           |                  | 267,753 |                                 |   | 51                                | %                              |   | 4.87 | % |
| Total                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                           | $                     | 523,969 |                                 |   | 100                               | %                              |   | 5.57 | % |

|                                    |                           | **Less                than****6                Months** |                           | **More                than 6 Months****to                24 Months** |                           | **More                than 24 Months****to                60 Months** |                           | **Total**                        |                           |
|-----------------------------------------|--------------------------------|---------------------------------------------------------|--------------------------------|----------------------------------------------------------------------|--------------------------------|-----------------------------------------------------------------------|--------------------------------|----------------------------------|--------------------------------|
|                                    |                           | **Carrying****Value**                                   |                           | **Weighted****Average****Yield**                                     |                           | **Carrying****Value**                                                 |                           | **Weighted****Average****Yield** |                           | **Carrying****Value** |   | **Weighted****Average****Yield** |   | **Carrying****Value** |   | **Weighted****Average****Yield** |   |
|                                    |       |                                                    |       |                                                                 |       |                                                                  |       |                             |       |   |       |   |       |   |       |   |   |
| Agency                REMIC Floaters    |                           | $                                                       | 178,991                        |                                                                 |                           | 6.56                                                                  | %                              | $                                | —                        |   |   |   |   | $ | — |   |   | — |   | $ | 178,991 |   |   | 6.56 | % |
| Private                Label Floaters   |                           |                                                    | 27,500                         |                                                                 |                           | 6.28                                                                  | %                         |                             | —                        |   |   | — |   |   | — |   |   | — |   |   | 27,500 |   |   | 6.28 | % |
| Private                Label ARMs       |                           |                                                    | —                        |                                                                 |                           | —                                                               |                           |                             | 43,703                         |   |   | 6.45 | % |   | 249,534 |   |   | 6.05 | %  |   | 293,237 |   |   | 6.11 | % |
| NYMT                Retained Securities |                           |                                                    | 6,022                          |                                                                 |                           | 7.15                                                                  | %                         |                             | —                        |   |   | — |   |   | 18,219 |   |   | 6.93 | % |   | 24,241 |   |   | 6.99 | % |
| Total                                   |                           | $                                                       | 212,513                        |                                                                 |                           | 6.54                                                                  | %                              | $                                | 43,703                         |   |   | 6.45 | % | $ | 267,753 |   |   | 6.12 | % | $ | 523,969 |   |   | 6.32 | % |

***Mortgage      Lending Related Assets***

*Mortgage      Loans Held for Sale.*

*Due      from Purchasers.*

----

*Escrow      Deposits - Pending Loan Closings.*

***Non-Loan      or Investment Assets***

*Cash      and Cash Equivalents.*

*Prepaid      and Other Assets.*

*Property      and Equipment, Net*

**Balance      Sheet Analysis -**
**      Financing Arrangements**

*Financing        Arrangements, Portfolio Investments.*

*Financing      Arrangements, Mortgage Loans Held for Sale/for Investment.*

*Collateralized      Debt Obligations.*

*Subordinated      Debentures.*

----

*Derivative      Assets and Liabilities.*

----

|                                                                                                                                                                                                                                                                            |   | **September 30,                2006 ** |    | **December 31, 2005** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------|---------|---------------------------------|--------|
|                                                                                                                                                                                                                                                                            |   |                                             |    |                            |   |
| **Derivative                Assets:**                                                                                                                                                                                                                                           |   |                                             |    |                            |   |
| Interest                rate caps                                                                                                                                                                                                                                               |   | $                                                | 2,179   |                            | $      | 3,340 |   |
| Interest                rate swaps                                                                                                                                                                                                                                              |   |                                             | 717     |                            |   | 6,383 |   |
| Interest                rate lock commitments - loan commitments                                                                                                                                                                                                                |   |                                             | 136     |                            |   | 123 |   |
| Interest                rate lock commitments - mortgage loans held for                sale                               |   |                                             | 370     |                            |   | — |   |
| Total                derivative assets                                                                                                                                                                                                                                          |   | $                                                | 3,402   |                            | $      | 9,846 |   |
| **Derivative                Liabilities:**                                                                                                                                                                                                                                      |   |                                             |    |                            |   |   |   |
| Forward                loan sale contracts - loan commitments                                                                                                                                                                                                                   |   |                                             | (71     | )                               |   | (38 | ) |
| Forward                loan sale contracts - mortgage loans held for sale                                                                                                                                                                                                       |   |                                             | (130    | )                               |   | (18 | ) |
| Forward                loan sale contracts - TBA securities                                                                                                                                                                                                                     |   |                                             | (485    | )                               |   | (324 | ) |
| Interest                rate lock commitments - mortgage loans held for                sale                               |   |                                             | — |                            |   | (14 | ) |
| Total                derivative liabilities                                                                                                                                                                                                                                     |   | $                                                | (686    | )                               | $      | (394 | ) |

**Balance      Sheet Analysis **
**-      Stockholders’ Equity**

**Securitizations**

**Prepayment      Experience**

----

**Results      of Operations**

|   | · | *The                demand for new mortgage loans*.                Reduced demand for mortgage loans causes closed loan origination                volume to                decline. Demand for new mortgage loans is directly impacted by current                interest rate trends and other economic conditions. Rising interest                rates                tend to reduce demand for new mortgage loans, particularly loan                refinancings, and falling interest rates tend to increase demand                for new                mortgage loans, particularly loan                refinancings. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | *Loan                refinancing and home purchase trends*.                As discussed above, the volume of loan refinancings tends to increase                following declines in interest rates and to decrease when interest                rates                rise. The volume of home purchases is also affected by interest rates,                although to a lesser extent than refinancing volume. Home purchase                trends                are also affected by other economic changes such as inflation,                improvements in the stock market, unemployment rates and other similar                factors. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | *Seasonality*.                Historically, according to the MBA, loan originations during November,                December, January and February of each year are typically lower than                during other months in the year due, in part, to inclement weather,                fewer                business days (due to holidays and the short month of February),                and the                fact that home buyers tend to purchase homes during the warmer months                of                the year. As a result, loan volumes tend to be lower in the first                and                fourth quarters of a year than in the second and third                quarters. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | *Occasional                spikes in volume resulting from isolated events*.                Mortgage lenders may experience spikes in loan origination volume                from                time to time due to non-recurring events or transactions, such as                a large                mass closing of a condominium project for which a bulk end-loan commitment                was negotiated. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                                                                                                                                                         |                     | **Number                of****Loans** |        | **Aggregate****Principal****Balance** |                      | **Percentage****of                Total****Principal** |                     | **Weighted****Average****Interest****Rate** |      | **Average****Principal****Balance** |   |  **Weighted****Average** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------|---------------------------------------|-------------|---------------------------------------|---------------------------|--------------------------------------------------------|--------------------------|---------------------------------------------|-----------|-------------------------------------|--------|-------------------------------|
| **LTV**                                                                                                                                                                                                                                                      |                     | **FICO**                              |
|                                                                                                                                                                                                                                                         |                     |                                  |        |                                  | ($ in millions) |                                                   |                     |                                        |      |                                |   |                          |   |   |   |   |   |   |   |   |
|                                            |                     |                                  |        |                                  |                      |                                                   |                     |                                        |      |                                |   |                          |   |   |   |   |   |   |   |   |   |
| **2006:**                                                                                                                                                                                                                                                    |      |                                  |        |                   |                      |                                                   |      |                                        |      |                 |   |                          |   |   |   |      |   |   |      |   |   |
| *Third                Quarter*                                                                                                                                                                                                                               |                     |                                  |        |                                  |                      |                                                   |                     |                                        |      |                                |   |                          |   |   |   |   |   |   |   |   |   |
| ARM                                                                                                                                                                                                                                                          |                     |                                  | 794         |                                  | $                         | 237.6                                                  |                     |                                        | 39.4      | %                    |   | 7.27                          | %    | $ | 299,209 |   |   | 72.8 |   |   | 704 |
| Fixed-rate                                                                                                                                                                                                                                                   |                     |                                  | 1,709       |                                  |                      | 351.1                                                  |                     |                                        | 58.2      | %                                   |   | 7.48                          | % |   | 205,433 |   |   | 75.6 |   |   | 711 |
| **Subtotal-non-FHA**                                                                                                                                                                                                                                         |                     |                                  | **2,503**   |                                  |                      | **588.7**                                              |                     |                                        | **97.6**  | **%**                               |   | **7.39**                      | **%** |   | **235,180** |   |   | **74.5** |   |   | **708** |
| FHA                - ARM                                                                                                                                                                                                                                     |                     |                                  | 3           |                                  |                      | 1.2                                                    |                     |                                        | 0.2       | %                                   |   | 6.06                          | % |   | 423,701 |   |   | 96.1 |   |   | 681 |
| FHA                - fixed-rate                                                                                                                                                                                                                              |                     |                                  | 82          |                                  |                      | 12.9                                                   |                     |                                        | 2.2       | %                                   |   | 6.61                          | % |   | 157,096 |   |   | 95.7 |   |   | 652 |
| Subtotal                - FHA                                                                                                                                                                                                                                |                     |                                  | 85          |                                  |                      | 14.1                                                   |                     |                                        | 2.4       | %                                   |   | 6.56                          | % |   | 166,506 |   |   | 95.7 |   |   | 654 |
| Total                ARM                                                                                                                                                                                                                                     |                     |                                  | 797         |                                  |                      | 238.8                                                  |                     |                                        | 39.6      | %                                   |   | 7.27                          | % |   | 299,678 |   |   | 72.9 |   |   | 704 |
| Total                fixed-rate                                                                                                                                                                                                                              |                     |                                  | 1,791       |                                  |                      | 364.0                                                  |                     |                                        | 60.4      | %                                   |   | 7.45                          | % |   | 203,220 |   |   | 76.4 |   |   | 709 |
| Total                Originations                                                                                                                                                                                                                            |                     |                                  | **2,588**   |                                  | **$**                     | **602.8**                                              |                     |                                        | **100.0** | **%**                               |   | **7.38**                      | **%** | **$** | **232,925** |   |   | **75.0** |   |   | **707** |
|                                                                                                                                                                                                                                                         |                     |                                  |        |                                  |                      |                                                   |                     |                                        |      |                                |   |                          |   |   |   |   |   |   |   |   |   |
| Purchase                mortgages                                                                                                                                                                                                                            |                     |                                  |  1,594 |                                  | $                         |  352.6                                            |                     |                                        | 58.5      | %                                   |   | 7.47                          | % | $ | 221,215 |   |   | 79.0 |   |   | 718 |
| Refinancings                                                                                                                                                                                                                                                 |                     |                                  | 909         |                                  |                      | 236.1                                                  |                     |                                        | 39.1      | %                                   |   | 7.28                          | % |   | 259,670 |   |   | 67.8 |   |   | 693 |
| **Subtotal-non-FHA**                                                                                                                                                                                                                                         |                     |                                  | **2,503**   |                                  |                      | **588.7**                                              |                     |                                        | **97.6**  | **%**                               |   | **7.39**                      | **%** |   | **235,180** |   |   | **74.5** |   |   | **708** |
| FHA                - purchase                                                                                                                                                                                                                                |                     |                                  | 70          |                                  |                      | 11.9                                                   |                     |                                        | 2.0       | %                                   |   | 6.50                          | % |   | 170,453 |   |   | 96.5 |   |   | 664 |
| FHA                - refinancings                                                                                                                                                                                                                            |                     |                                  | 15          |                                  |                      | 2.2                                                    |                     |                                        | 0.4       | %                                   |   | 6.84                          | % |   | 148,087 |   |   | 91.4 |   |   | 604 |
| Subtotal                - FHA                                                                                                                                                                                                                                |                     |                                  | 85          |                                  |                      | 14.1                                                   |                     |                                        | 2.4       | %                                   |   | 6.56                          | % |   | 166,506 |   |   | 95.7 |   |   | 654 |
| Total                purchase                                                                                                                                                                                                                                |                     |                                  | 1,664       |                                  |                      | 364.5                                                  |                     |                                        | 60.5      | %                                   |   | 7.44                          | % |   | 219,079 |   |   | 79.5 |   |   | 716 |
| Total                refinancings                                                                                                                                                                                                                            |                     |                                  | 924         |                                  |                      | 238.3                                                  |                     |                                        | 39.5      | %                                   |   | 7.27                          | % |   | 257,858 |   |   | 68.0 |   |   | 692 |
| Total                Originations                                                                                                                                                                                                                            |                     |                                  | **2,588**   |                                  | **$**                     | **602.8**                                              |                     |                                        | **100.0** | **%**                               |   | **7.38**                      | **%** | **$** | **232,925** |   |   | **75.0** |   |   | **707** |
|                                                                     |                     |                                  |        |                                  |                      |                                                   |                     |                                        |      |            |   |                          |       |   |   |   |   |   |   |   |   |
| *Second                Quarter*                                                                                                                                                                                                                              |                     |                                  |        |                                  |                      |                                                   |                     |                                        |      |                                |   |                          |   |   |   |   |   |   |   |   |   |
| ARM                                                                                                                                                                                                                                                          |                     |                                  | 1,021       |                                  | $                         | 352.4                                                  |                     |                                        | 47.5      | %                    |   | 6.83                          | %    | $ | 345,116 |   |   | 72.2 |   |   | 711 |
| Fixed-rate                                                                                                                                                                                                                                                   |                     |                                  | 1,687       |                                  |                      | 358.8                                                  |                     |                                        | 48.4      | %                                   |   | 7.21                          | % |   | 212,710 |   |   | 75.1 |   |   | 713 |
| **Subtotal-non-FHA**                                                                                                                                                                                                                                         |                     |                                  | **2,708**   |                                  |                      | **711.2**                                              |                     |                                        | **95.9**  | **%**                               |   | **7.02**                      | **%** |   | **262,631** |   |   | **73.7** |   |   | **712** |
| FHA                - ARM                                                                                                                                                                                                                                     |                     |                                  | 7           |                                  |                      | 1.7                                                    |                     |                                        | 0.2       | %                                   |   | 5.60                          | % |   | 242,250 |   |   | 95.8 |   |   | 608 |
| FHA                - fixed-rate                                                                                                                                                                                                                              |                     |                                  | 170         |                                  |                      | 28.9                                                   |                     |                                        | 3.9       | %                                   |   | 6.32                          | % |   | 169,950 |   |   | 93.3 |   |   | 662 |
| Subtotal                - FHA                                                                                                                                                                                                                                |                     |                                  | 177         |                                  |                      | 30.6                                                   |                     |                                        | 4.1       | %                                   |   | 6.28                          | % |   | 172,809 |   |   | 93.4 |   |   | 659 |
| Total                ARM                                                                                                                                                                                                                                     |                     |                                  | 1,028       |                                  |                      | 354.1                                                  |                     |                                        | 47.7      | %                                   |   | 6.82                          | % |   | 344,415 |   |   | 72.3 |   |   | 711 |
| Total                fixed-rate                                                                                                                                                                                                                              |                     |                                  | 1,857       |                                  |                      | 387.7                                                  |                     |                                        | 52.3      | %                                   |   | 7.14                          | % |   | 208,795 |   |   | 76.5 |   |   | 709 |
| Total                Originations                                                                                                                                                                                                                            |                     |                                  | **2,885**   |                                  | **$**                     | **741.8**                                              |                     |                                        | **100.0** | **%**                               |   | **6.99**                      | **%** | **$** | **257,120** |   |   | **74.5** |   |   | **710** |

----

|                                                                                                                                                                                                                           |   |   |        |   |   |        |   |   |      |                           |   |     |                           |   |        |   |   |     |   |   |    |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-------------|--------|--------|-------------|--------|--------|-----------|--------------------------------|--------|----------|--------------------------------|--------|-------------|--------|--------|----------|--------|--------|---------|
| Purchase                mortgages                                                                                                                                                                                              |   |   |  1,792 |   | $      |  434.7 |   |   | 58.6      | %                              |   | 7.10     | %                              | $      | 242,591     |   |   | 78.7     |   |   | 720     |
| Refinancings                                                                                                                                                                                                                   |   |   | 916         |   |   | 276.5       |   |   | 37.3      | %                              |   | 6.89     | %                              |   | 301,836     |   |   | 65.8     |   |   | 698     |
| **Subtotal-non-FHA**                                                                                                                                                                                                           |   |   | **2,708**   |   |   | **711.2**   |   |   | **95.9**  | **%**                          |   | **7.02** | **%**                          |   | **262,631** |   |   | **73.7** |   |   | **712** |
| FHA                - purchase                                                                                                                                                                                                  |   |   | 108         |   |   | 19.2        |   |   | 2.6       | %                              |   | 6.23     | %                              |   | 178,164     |   |   | 96.6     |   |   | 669     |
| FHA                - refinancings                                                                                                                                                                                              |   |   | 69          |   |   | 11.4        |   |   | 1.5       | %                              |   | 6.38     | %                              |   | 164,429     |   |   | 88.0     |   |   | 642     |
| Subtotal                - FHA                                                                                                                                                                                                  |   |   | 177         |   |   | 30.6        |   |   | 4.1       | %                              |   | 6.28     | %                              |   | 172,809     |   |   | 93.4     |   |   | 659     |
| Total                purchase                                                                                                                                                                                                  |   |   | 1,900       |   |   | 453.9       |   |   | 61.2      | %                              |   | 7.07     | %                              |   | 238,929     |   |   | 79.4     |   |   | 718     |
| Total                refinancings                                                                                                                                                                                              |   |   | 985         |   |   | 287.9       |   |   | 38.8      | %                              |   | 6.87     | %                              |   | 292,210     |   |   | 66.7     |   |   | 696     |
| Total                Originations                                                                                                                                                                                              |   |   | **2,885**   |   | **$**  | **741.8**   |   |   | **100.0** | **%**                          |   | **6.99** | **%**                          | **$**  | **257,120** |   |   | **74.5** |   |   | **710** |
|                                       |   |   |        |   |   |        |   |   |      |       |   |     |       |   |        |   |   |     |   |   |    |
| *First                Quarter*                                                                                                                                                                                                 |   |   |        |   |   |        |   |   |      |                           |   |     |                           |   |        |   |   |     |   |   |    |
| ARM                                                                                                                                                                                                                            |   |   | 924         |   | $      | 290.6       |   |   | 47.4      | %                              |   | 6.71     | %                              | $      | 314,555     |   |   | 71.6     |   |   | 705     |
| Fixed-rate                                                                                                                                                                                                                     |   |   | 1,442       |   |   | 299.2       |   |   | 48.8      | %                              |   | 7.06     | %                              |   | 207,519     |   |   | 73.3     |   |   | 712     |
| **Subtotal-non-FHA**                                                                                                                                                                                                           |   |   | **2,366**   |   |   | **589.8**   |   |   | **96.2**  | **%**                          |   | **6.89** | **%**                          |   | **249,320** |   |   | **72.5** |   |   | **709** |
| FHA                - ARM                                                                                                                                                                                                       |   |   | 2           |   |   | 0.5         |   |   | 0.0       | %                              |   | 5.57     | %                              |   | 228,253     |   |   | 93.0     |   |   | 646     |
| FHA                - fixed-rate                                                                                                                                                                                                |   |   | 142         |   |   | 23.5        |   |   | 3.8       | %                              |   | 6.13     | %                              |   | 165,161     |   |   | 92.7     |   |   | 650     |
| Subtotal                - FHA                                                                                                                                                                                                  |   |   | 144         |   |   | 24.0        |   |   | 3.8       | %                              |   | 6.12     | %                              |   | 166,037     |   |   | 92.7     |   |   | 650     |
| Total                ARM                                                                                                                                                                                                       |   |   | 926         |   |   | 291.1       |   |   | 47.4      | %                              |   | 6.71     | %                              |   | 314,369     |   |   | 71.7     |   |   | 705     |
| Total                fixed-rate                                                                                                                                                                                                |   |   | 1,584       |   |   | 322.7       |   |   | 52.6      | %                              |   | 6.99     | %                              |   | 203,722     |   |   | 74.7     |   |   | 708     |
| Total                Originations                                                                                                                                                                                              |   |   | **2,510**   |   | **$**  | **613.8**   |   |   | **100.0** | **%**                          |   | **6.86** | **%**                          | **$**  | **244,542** |   |   | **73.2** |   |   | **706** |
|                                                                                                                                                                                                                           |   |   |        |   |   |        |   |   |      |                           |   |     |                           |   |        |   |   |     |   |   |    |
| Purchase                mortgages                                                                                                                                                                                              |   |   | 1,430       |   | $      | 335.5       |   |   | 54.8      | %                              |   | 6.94     | %                              | $      | 234,600     |   |   | 77.2     |   |   | 722     |
| Refinancings                                                                                                                                                                                                                   |   |   | 936         |   |   | 254.3       |   |   | 41.4      | %                              |   | 6.81     | %                              |   | 271,809     |   |   | 66.2     |   |   | 692     |
| **Subtotal-non-FHA**                                                                                                                                                                                                           |   |   | **2,366**   |   |   | **589.8**   |   |   | **96.2**  | **%**                          |   | **6.89** | **%**                          |   | **249,320** |   |   | **72.5** |   |   | **709** |
| FHA                - purchase                                                                                                                                                                                                  |   |   | 70          |   |   | 12.7        |   |   | 2.0       | %                              |   | 6.07     | %                              |   | 181,325     |   |   | 96.4     |   |   | 655     |
| FHA                - refinancings                                                                                                                                                                                              |   |   | 74          |   |   | 11.3        |   |   | 1.8       | %                              |   | 6.17     | %                              |   | 151,576     |   |   | 88.6     |   |   | 645     |
| Subtotal                - FHA                                                                                                                                                                                                  |   |   | 144         |   |   | 24.0        |   |   | 3.8       | %                              |   | 6.12     | %                              |   | 166,037     |   |   | 92.7     |   |   | 650     |
| Total                purchase                                                                                                                                                                                                  |   |   | 1,500       |   |   | 348.2       |   |   | 56.8      | %                              |   | 6.91     | %                              |   | 232,144     |   |   | 77.9     |   |   | 719     |
| Total                refinancings                                                                                                                                                                                              |   |   | 1,010       |   |   | 265.6       |   |   | 43.2      | %                              |   | 6.78     | %                              |   | 263,000     |   |   | 67.1     |   |   | 690     |
| Total                Originations                                                                                                                                                                                              |   |   | **2,510**   |   | **$**  | **613.8**   |   |   | **100.0** | **%**                          |   | **6.86** | **%**                          | **$**  | **244,542** |   |   | **73.2** |   |   | **706** |

----

|                                                                                                                                                                                                                                                   |            | **Number                of****Loans** |      | **Aggregate****Principal****Balance** |      | **Percentage****of                Total****Principal** |            | **Weighted****Average****Interest****Rate** |      | **Average****Principal****Balance** |      |  **Weighted****Average ** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|---------------------------------------|--------------------------|---------------------------------------|--------------------------|--------------------------------------------------------|--------------------------------|---------------------------------------------|--------------------------|-------------------------------------|--------------------------|-------------------------------------|
| **LTV**                                                                                                                                                                                                                                                | **FICO**                       |
|                                                                                                                                                                                                                                                   |                           |                                  |                     |                                  |                     | ($ in millions)                              |                           |                                        |                     |                                |                     |                                |   |   |   |   |   |   |   |   |   |
|                                           |                           |                                  |                     |                                  |                     |                                                   |                           |                                        |                     |                                |                     |                                |   |   |   |   |   |   |   |   |   |
| **2005:**                                                                                                                                                                                                                                              |       |                                  |                     |              |                     |                                                   |       |                                        |                     |            |                     |                                |       |   |   |       |   |   |       |   |   |
| *Fourth                Quarter*                                                                                                                                                                                                                        |                           |                                  |                     |                                  |                     |                                                   |                           |                                        |                     |                                |                     |                                |   |   |   |   |   |   |   |   |   |
| ARM                                                                                                                                                                                                                                                    |                           |                                  | 1,321                    |                                  | $                        | 452.5                                                  |                           |                                        | 55.0                     | %                    |                     | 6.33                                | %    | $ | 342,551 |   |   | 71.9 |   |   | 700 |
| Fixed-rate                                                                                                                                                                                                                                             |                           |                                  | 1,617                    |                                  |                     | 343.7                                                  |                           |                                        | 41.8                     | %                                   |                     | 6.79                                | % |   | 212,524 |   |   | 72.2 |   |   | 712 |
| **Subtotal-non-FHA**                                                                                                                                                                                                                                   |                           |                                  | **2,938**                |                                  |                     | **796.2**                                              |                           |                                        | **96.8**                 | **%**                               |                     | **6.53**                            | **%** |   | **270,987** |   |   | **72.1** |   |   | **705** |
| FHA                - ARM                                                                                                                                                                                                                               |                           |                                  | 1                        |                                  |                     | 0.2                                                    |                           |                                        | 0.0                      | %                                   |                     | 5.80                                | % |   | 157,545 |   |   | 84.6 |   |   | 655 |
| FHA                - fixed-rate                                                                                                                                                                                                                        |                           |                                  | 194                      |                                  |                     | 26.5                                                   |                           |                                        | 3.2                      | %                                   |                     | 6.06                                | % |   | 136,820 |   |   | 93.5 |   |   | 639 |
| Subtotal                - FHA                                                                                                                                                                                                                          |                           |                                  | 195                      |                                  |                     | 26.7                                                   |                           |                                        | 3.2                      | %                                   |                     | 6.06                                | % |   | 136,927 |   |   | 93.4 |   |   | 639 |
| Total                ARM                                                                                                                                                                                                                               |                           |                                  | 1,322                    |                                  |                     | 452.7                                                  |                           |                                        | 55.0                     | %                                   |                     | 6.33                                | % |   | 342,411 |   |   | 72.0 |   |   | 700 |
| Total                fixed-rate                                                                                                                                                                                                                        |                           |                                  | 1,811                    |                                  |                     | 370.2                                                  |                           |                                        | 45.0                     | %                                   |                     | 6.74                                | % |   | 204,414 |   |   | 73.7 |   |   | 707 |
| Total                Originations                                                                                                                                                                                                                      |                           |                                  | **3,133**                |                                  | **$**                    | **822.9**                                              |                           |                                        | **100.0**                | **%**                               |                     | **6.52**                            | **%** | **$** | **262,643** |   |   | **72.7** |   |   | **703** |
|                                                                                                                                                                                                                                                   |                           |                                  |                     |                                  |                     |                                                   |                           |                                        |                     |                                |                     |                                |   |   |   |   |   |   |   |   |   |
| Purchase                mortgages                                                                                                                                                                                                                      |                           |                                  | 1,949                    |                                  | $                        | 426.8                                                  |                           |                                        | 51.9                     | %                    |                     | 6.73                                | %    | $ | 218,995 |   |   | 78.5 |   |   | 716 |
| Refinancings                                                                                                                                                                                                                                           |                           |                                  | 989                      |                                  |                     | 369.4                                                  |                           |                                        | 44.9                     | %                                   |                     | 6.29                                | % |   | 373,447 |   |   | 64.5 |   |   | 692 |
| **Subtotal-non-FHA**                                                                                                                                                                                                                                   |                           |                                  | **2,938**                |                                  |                     | **796.2**                                              |                           |                                        | **96.8**                 | **%**                               |                     | **6.53**                            | **%** |   | **270,987** |   |   | **72.1** |   |   | **705** |
| FHA                - purchase                                                                                                                                                                                                                          |                           |                                  | 38                       |                                  |                     | 6.1                                                    |                           |                                        | 0.7                      | %                                   |                     | 6.40                                | % |   | 161,278 |   |   | 97.4 |   |   | 649 |
| FHA                - refinancings                                                                                                                                                                                                                      |                           |                                  | 157                      |                                  |                     | 20.6                                                   |                           |                                        | 2.5                      | %                                   |                     | 5.95                                | % |   | 131,033 |   |   | 92.1 |   |   | 636 |
| Subtotal                - FHA                                                                                                                                                                                                                          |                           |                                  | 195                      |                                  |                     | 26.7                                                   |                           |                                        | 3.2                      | %                                   |                     | 6.06                                | % |   | 136,927 |   |   | 93.4 |   |   | 639 |
| Total                purchase                                                                                                                                                                                                                          |                           |                                  | 1,987                    |                                  |                     | 432.9                                                  |                           |                                        | 52.6                     | %                                   |                     | 6.72                                | % |   | 217,891 |   |   | 78.8 |   |   | 715 |
| Total                refinancings                                                                                                                                                                                                                      |                           |                                  | 1,146                    |                                  |                     | 390.0                                                  |                           |                                        | 47.4                     | %                                   |                     | 6.28                                | % |   | 340,237 |   |   | 66.0 |   |   | 689 |
| Total                Originations                                                                                                                                                                                                                      |                           |                                  | **3,133**                |                                  | **$**                    | **822.9**                                              |                           |                                        | **100.0**                | **%**                               |                     | **6.52**                            | **%** | **$** | **262,643** |   |   | **72.7** |   |   | **703** |
|                                                                                                                                                                                                                                                   |                           |                                  |                     |                                  |                     |                                                   |                           |                                        |                     |                                |                     |                                |   |   |   |   |   |   |   |   |   |
| *Third                Quarter*                                                                                                                                                                                                                         |                           |                                  |                     |                                  |                     |                                                   |                           |                                        |                     |                                |                     |                                |   |   |   |   |   |   |   |   |   |
| ARM                                                                                                                                                                                                                                                    |                           |                                  | 1,727                    |                                  | $                        | 513.3                                                  |                           |                                        | 51.2                     | %                                   |                     | 6.10                                | % | $ | 297,213 |   |   | 73.8 |   |   | 705 |
| Fixed-rate                                                                                                                                                                                                                                             |                           |                                  | 1,946                    |                                  |                     | 392.2                                                  |                           |                                        | 39.1                     | %                                   |                     | 6.43                                | % |   | 201,537 |   |   | 73.2 |   |   | 717 |
| **Subtotal-non-FHA**                                                                                                                                                                                                                                   |                           |                                  | **3,673**                |                                  |                     | **905.5**                                              |                           |                                        | **90.3**                 | **%**                               |                     | **6.25**                            | **%** |   | **246,522** |   |   | **73.5** |   |   | **710** |
| FHA                - ARM                                                                                                                                                                                                                               |                           |                                  | 4                        |                                  |                     | 0.8                                                    |                           |                                        | 0.1                      | %                                   |                     | 5.80                                | % |   | 217,202 |   |   | 94.7 |   |   | 642 |
| FHA                - fixed-rate                                                                                                                                                                                                                        |                           |                                  | 700                      |                                  |                     | 95.9                                                   |                           |                                        | 9.6                      | %                                   |                     | 5.72                                | % |   | 136,954 |   |   | 92.9 |   |   | 633 |
| Subtotal                - FHA                                                                                                                                                                                                                          |                           |                                  | 704                      |                                  |                     | 96.7                                                   |                           |                                        | 9.7                      | %                                   |                     | 5.72                                | % |   | 137,410 |   |   | 93.0 |   |   | 633 |
| Total                ARM                                                                                                                                                                                                                               |                           |                                  | 1,731                    |                                  |                     | 514.1                                                  |                           |                                        | 51.3                     | %                                   |                     | 6.10                                | % |   | 297,028 |   |   | 73.8 |   |   | 705 |
| Total                fixed-rate                                                                                                                                                                                                                        |                           |                                  | 2,646                    |                                  |                     | 488.1                                                  |                           |                                        | 48.7                     | %                                   |                     | 6.29                                | % |   | 184,451 |   |   | 77.1 |   |   | 700 |
| Total                Originations                                                                                                                                                                                                                      |                           |                                  | **4,377**                |                                  | **$**                    | **1,002.2**                                            |                           |                                        | **100.0**                | **%**                               |                     | **6.19**                            | **%** | **$** | **228,973** |   |   | **75.4** |   |   | **703** |
|                                                                                                                                                                                                                                                   |                           |                                  |                     |                                  |                     |                                                   |                           |                                        |                     |                                |                     |                                |   |   |   |   |   |   |   |   |   |
| Purchase                mortgages                                                                                                                                                                                                                      |                           |                                  | 2,568                    |                                  | $                        | 558.1                                                  |                           |                                        | 55.7                     | %                                   |                     | 6.39                                | % | $ | 217,314 |   |   | 78.1 |   |   | 719 |
| Refinancings                                                                                                                                                                                                                                           |                           |                                  | 1,105                    |                                  |                     | 347.4                                                  |                           |                                        | 34.6                     | %                                   |                     | 6.01                                | % |   | 314,402 |   |   | 66.2 |   |   | 696 |
| **Subtotal-non-FHA**                                                                                                                                                                                                                                   |                           |                                  | **3,673**                |                                  |                     | **905.5**                                              |                           |                                        | **90.3**                 | **%**                               |                     | **6.25**                            | **%** |   | **246,522** |   |   | **73.5** |   |   | **710** |
| FHA                - purchase                                                                                                                                                                                                                          |                           |                                  | 71                       |                                  |                     | 11.7                                                   |                           |                                        | 1.2                      | %                                   |                     | 6.05                                | % |   | 165,045 |   |   | 96.3 |   |   | 659 |
| FHA                - refinancings                                                                                                                                                                                                                      |                           |                                  | 633                      |                                  |                     | 85.0                                                   |                           |                                        | 8.5                      | %                                   |                     | 5.67                                | % |   | 134,310 |   |   | 92.5 |   |   | 630 |
| Subtotal                - FHA                                                                                                                                                                                                                          |                           |                                  | 704                      |                                  |                     | 96.7                                                   |                           |                                        | 9.7                      | %                                   |                     | 5.72                                | % |   | 137,410 |   |   | 93.0 |   |   | 633 |
| Total                purchase                                                                                                                                                                                                                          |                           |                                  | 2,639                    |                                  |                     | 569.8                                                  |                           |                                        | 56.9                     | %                                   |                     | 6.38                                | % |   | 215,908 |   |   | 78.5 |   |   | 718 |
| Total                refinancings                                                                                                                                                                                                                      |                           |                                  | 1,738                    |                                  |                     | 432.4                                                  |                           |                                        | 43.1                     | %                                   |                     | 5.94                                | % |   | 248,811 |   |   | 71.4 |   |   | 683 |
| Total                Originations                                                                                                                                                                                                                      |                           |                                  | **4,377**                |                                  | **$**                    | **1,002.2**                                            |                           |                                        | **100.0**                | **%**                               |                     | **6.19**                            | **%** | **$** | **228,973** |   |   | **75.4** |   |   | **703** |

----

|                                                                                                                                                                                                                                                                                                                                                                           |  **   **   | **Number                of Loans** |      | **Aggregate****Principal****Balance** |      | **Percentage****of                Total Principal** |            | **Weighted****Average****Interest                Rate** |      | **Average****Principal                Balance** |      |  **Weighted****Average** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|------------------------------------|--------------------------|---------------------------------------|--------------------------|-----------------------------------------------------|--------------------------------|---------------------------------------------------------|--------------------------|-------------------------------------------------|--------------------------|-------------------------------|
| **LTV**                                                                                                                                                                                                                                                                                                                                                                        |            | **FICO**                           |
|                                                                                                                                                                                                                                                                                                                                                                           |                           |                               |                     |                                  |                     | ($ in millions)                           |                           |                                                    |                     |                                            |                     |                          |   |   |   |   |   |   |   |             |
|                                                               |                           |                               |                     |                                  |                     |                                                |                           |                                                    |                     |                                            |                     |                          |   |   |   |   |   |   |   |   |   |
| *Second                Quarter*                                                                                                                                                                                                                                                                                                                                                |       |                               |                     |              |                     |                                                |       |                                                    |                     |                        |                     |                          |       |   |   |       |   |   |      |   |   |
| ARM                                                                                                                                                                                                                                                                                                                                                                            |                           |                               | 1,839                    |                                  | $                        | 537.9                                               |                           |                                                    | 57.2                     | %                                |                     | 5.90                          | %    | $ | 292,482 |   |   | 72.7 |   |   | 709 |
| Fixed-rate                                                                                                                                                                                                                                                                                                                                                                     |                           |                               | 1,777                    |                                  |                     | 337.1                                               |                           |                                                    | 35.9                     | %                                               |                     | 6.47                          | % |   | 189,732 |   |   | 72.7 |   |   | 718 |
| **Subtotal-non-FHA**                                                                                                                                                                                                                                                                                                                                                           |                           |                               | **3,616**                |                                  |                     | **875.0**                                           |                           |                                                    | **93.1**                 | **%**                                           |                     | **6.12**                      | **%** |   | **241,988** |   |   | **72.7** |   |   | **712** |
| FHA                - ARM                                                                                                                                                                                                                                                                                                                                                       |                           |                               | 30                       |                                  |                     | 4.8                                                 |                           |                                                    | 0.5                      | %                                               |                     | 5.34                          | % |   | 159,088 |   |   | 93.7 |   |   | 611 |
| FHA                - fixed-rate                                                                                                                                                                                                                                                                                                                                                |                           |                               | 449                      |                                  |                     | 59.9                                                |                           |                                                    | 6.4                      | %                                               |                     | 5.97                          | % |   | 133,408 |   |   | 92.6 |   |   | 624 |
| Subtotal                - FHA                                                                                                                                                                                                                                                                                                                                                  |                           |                               | 479                      |                                  |                     | 64.7                                                |                           |                                                    | 6.9                      | %                                               |                     | 5.92                          | % |   | 135,016 |   |   | 92.7 |   |   | 623 |
| Total                ARM                                                                                                                                                                                                                                                                                                                                                       |                           |                               | 1,869                    |                                  |                     | 542.7                                               |                           |                                                    | 57.7                     | %                                               |                     | 5.89                          | % |   | 290,341 |   |   | 72.8 |   |   | 708 |
| Total                fixed-rate                                                                                                                                                                                                                                                                                                                                                |                           |                               | 2,226                    |                                  |                     | 397.0                                               |                           |                                                    | 42.3                     | %                                               |                     | 6.39                          | % |   | 178,371 |   |   | 75.7 |   |   | 704 |
| Total                Originations                                                                                                                                                                                                                                                                                                                                              |                           |                               | **4,095**                |                                  | **$**                    | **939.7**                                           |                           |                                                    | **100.0**                | **%**                                           |                     | **6.10**                      | **%** | **$** | **229,475** |   |   | **74.0** |   |   | **706** |
|                                                                                                                                                                                                                                                                                                                                                                           |                           |                               |                     |                                  |                     |                                                |                           |                                                    |                     |                                            |                     |                          |   |   |   |   |   |   |   |   |   |
| Purchase                mortgages                                                                                                                                                                                                                                                                                                                                              |                           |                               | 2,652                    |                                  | $                        | 587.8                                               |                           |                                                    | 62.6                     | %                                               |                     | 6.21                          | % | $ | 221,657 |   |   | 76.4 |   |   | 720 |
| Refinancings                                                                                                                                                                                                                                                                                                                                                                   |                           |                               | 964                      |                                  |                     | 287.2                                               |                           |                                                    | 30.5                     | %                                               |                     | 5.94                          | % |   | 297,918 |   |   | 65.1 |   |   | 695 |
| **Subtotal-non-FHA**                                                                                                                                                                                                                                                                                                                                                           |                           |                               | **3,616**                |                                  |                     | **875.0**                                           |                           |                                                    | **93.1**                 | **%**                                           |                     | **6.12**                      | **%** |   | **241,988** |   |   | **72.7** |   |   | **712** |
| FHA                - purchase                                                                                                                                                                                                                                                                                                                                                  |                           |                               | 85                       |                                  |                     | 13.9                                                |                           |                                                    | 1.5                      | %                                               |                     | 5.99                          | % |   | 163,693 |   |   | 96.3 |   |   | 644 |
| FHA                - refinancings                                                                                                                                                                                                                                                                                                                                              |                           |                               | 394                      |                                  |                     | 50.8                                                |                           |                                                    | 5.4                      | %                                               |                     | 5.91                          | % |   | 128,829 |   |   | 91.7 |   |   | 617 |
| Subtotal                - FHA                                                                                                                                                                                                                                                                                                                                                  |                           |                               | 479                      |                                  |                     | 64.7                                                |                           |                                                    | 6.9                      | %                                               |                     | 5.92                          | % |   | 135,016 |   |   | 92.7 |   |   | 623 |
| Total                purchase                                                                                                                                                                                                                                                                                                                                                  |                           |                               | 2,737                    |                                  |                     | 601.7                                               |                           |                                                    | 64.1                     | %                                               |                     | 6.20                          | % |   | 219,857 |   |   | 76.8 |   |   | 719 |
| Total                refinancings                                                                                                                                                                                                                                                                                                                                              |                           |                               | 1,358                    |                                  |                     | 338.0                                               |                           |                                                    | 35.9                     | %                                               |                     | 5.93                          | % |   | 248,860 |   |   | 69.1 |   |   | 684 |
| Total                Originations                                                                                                                                                                                                                                                                                                                                              |                           |                               | **4,095**                |                                  | **$**                    | **939.7**                                           |                           |                                                    | **100.0**                | **%**                                           |                     | **6.10**                      | **%** | **$** | **228,973** |   |   | **74.0** |   |   | **706** |
|                                                                                                                                                                                                                                                                                                                                                                           |                           |                               |                     |                                  |                     |                                                |                           |                                                    |                     |                                            |                     |                          |   |   |   |   |   |   |   |   |   |
| *First                Quarter*                                                                                                                                                                                                                                                                                                                                                 |                           |                               |                     |                                  |                     |                                                |                           |                                                    |                     |                                            |                     |                          |   |   |   |   |   |   |   |   |   |
| ARM                                                                                                                                                                                                                                                                                                                                                                            |                           |                               | 1,313                    |                                  | $                        | 355.3                                               |                           |                                                    | 52.8                     | %                                               |                     | 5.61                          | % | $ | 270,603 |   |   | 72.7 |   |   | 708 |
| Fixed-rate                                                                                                                                                                                                                                                                                                                                                                     |                           |                               | 1,274                    |                                  |                     | 247.8                                               |                           |                                                    | 36.9                     | %                                               |                     | 6.31                          | % |   | 194,541 |   |   | 71.4 |   |   | 719 |
| **Subtotal-non-FHA**                                                                                                                                                                                                                                                                                                                                                           |                           |                               | **2,587**                |                                  |                     | **603.1**                                           |                           |                                                    | **89.7**                 | **%**                                           |                     | **5.90**                      | **%** |   | **233,145** |   |   | **72.2** |   |   | **712** |
| FHA                - ARM                                                                                                                                                                                                                                                                                                                                                       |                           |                               | 59                       |                                  |                     | 9.5                                                 |                           |                                                    | 1.4                      | %                                               |                     | 5.10                          | % |   | 160,093 |   |   | 93.8 |   |   | 648 |
| FHA                - fixed-rate                                                                                                                                                                                                                                                                                                                                                |                           |                               | 462                      |                                  |                     | 59.9                                                |                           |                                                    | 8.9                      | %                                               |                     | 5.85                          | % |   | 129,756 |   |   | 92.2 |   |   | 635 |
| Subtotal                - FHA                                                                                                                                                                                                                                                                                                                                                  |                           |                               | 521                      |                                  |                     | 69.4                                                |                           |                                                    | 10.3                     | %                                               |                     | 5.75                          | % |   | 133,191 |   |   | 92.4 |   |   | 637 |
| Total                ARM                                                                                                                                                                                                                                                                                                                                                       |                           |                               | 1,372                    |                                  |                     | 364.8                                               |                           |                                                    | 54.2                     | %                                               |                     | 5.60                          | % |   | 265,851 |   |   | 73.2 |   |   | 706 |
| Total                fixed-rate                                                                                                                                                                                                                                                                                                                                                |                           |                               | 1,736                    |                                  |                     | 307.7                                               |                           |                                                    | 45.8                     | %                                               |                     | 6.22                          | % |   | 177,299 |   |   | 75.5 |   |   | 703 |
| Total                Originations                                                                                                                                                                                                                                                                                                                                              |                           |                               | **3,108**                |                                  | **$**                    | **672.5**                                           |                           |                                                    | **100.0**                | **%**                                           |                     | **5.88**                      | **%** | **$** | **216,390** |   |   | **74.3** |   |   | **705** |
|                                                                                                                                                                                                                                                                                                                                                                           |                           |                               |                     |                                  |                     |                                                |                           |                                                    |                     |                                            |                     |                          |   |   |   |   |   |   |   |   |   |
| Purchase                mortgages                                                                                                                                                                                                                                                                                                                                              |                           |                               | 1,717                    |                                  | $                        | 365.9                                               |                           |                                                    | 54.4                     | %                                               |                     | 6.03                          | % | $ | 213,081 |   |   | 76.2 |   |   | 723 |
| Refinancings                                                                                                                                                                                                                                                                                                                                                                   |                           |                               | 870                      |                                  |                     | 237.2                                               |                           |                                                    | 35.3                     | %                                               |                     | 5.69                          | % |   | 272,743 |   |   | 66.0 |   |   | 696 |
| **Subtotal-non-FHA**                                                                                                                                                                                                                                                                                                                                                           |                           |                               | **2,587**                |                                  |                     | **603.1**                                           |                           |                                                    | **89.7**                 | **%**                                           |                     | **5.90**                      | **%** |   | **233,145** |   |   | **72.2** |   |   | **712** |
| FHA                - purchase                                                                                                                                                                                                                                                                                                                                                  |                           |                               | 95                       |                                  |                     | 15.1                                                |                           |                                                    | 2.2                      | %                                               |                     | 5.66                          | % |   | 158,699 |   |   | 97.2 |   |   | 672 |
| FHA                - refinancings                                                                                                                                                                                                                                                                                                                                              |                           |                               | 426                      |                                  |                     | 54.3                                                |                           |                                                    | 8.1                      | %                                               |                     | 5.78                          | % |   | 127,503 |   |   | 91.0 |   |   | 627 |
| Subtotal                - FHA                                                                                                                                                                                                                                                                                                                                                  |                           |                               | 521                      |                                  |                     | 69.4                                                |                           |                                                    | 10.3                     | %                                               |                     | 5.75                          | % |   | 133,191 |   |   | 92.4 |   |   | 637 |
| Total                purchase                                                                                                                                                                                                                                                                                                                                                  |                           |                               | 1,812                    |                                  |                     | 381.0                                               |                           |                                                    | 56.6                     | %                                               |                     | 6.02                          | % |   | 210,230 |   |   | 77.0 |   |   | 721 |
| Total                refinancings                                                                                                                                                                                                                                                                                                                                              |                           |                               | 1,296                    |                                  |                     | 291.5                                               |                           |                                                    | 43.4                     | %                                               |                     | 5.71                          | % |   | 225,002 |   |   | 70.7 |   |   | 683 |
| Total                Originations                                                                                                                                                                                                                                                                                                                                              |                           |                               | **3,108**                |                                  | **$**                    | **672.5**                                           |                           |                                                    | **100.0**                | **%**                                           |                     | **5.88**                      | **%** | **$** | **216,390** |   |   | **74.3** |   |   | **705** |

----

**Results      of Operations **
**-      Comparison of the Nine and Three Months Ended September 30, 2006, and      September 30, 2005**

***Net      Income***
**-      Overview**

**Comparative      Net Income**

|                                                                                                                                                                                                  |                                 | **For                the Nine Months Ended****September 30,** |                               |                            |                               |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------|--------------------------------------------------------------------|------------------------------------|---------------------------------|------------------------------------|
|                                                                                                                                                                                                  |                                 | **2006**                                                           | **     ** | **2005**                        | **     ** | **%                Change** |   |
|                                                                                                                                                                                                  |                                 | (dollar                amounts in thousands except per share data) |                               |
|                                                                                                                                                                                                  |                                 |                                                               |                               |                            |                               |   |   |   |   |   |
| Net                (loss) income                                                                                                                                                                      |                                 | $                                                                  | (5,486                             | )      | $                                  | 3,368 |       |   | (262.9 | )% |
| Earnings                (loss) per share (basic)                                                                                                                                                      |                                 | $                                                                  | (0.31                              | )                               | $                                  | 0.19 |   |   | (263.2 | )% |
| Earnings                (loss) per share                (diluted)                       |        | $                                                                  | (0.31                              | )                               | $                                  | 0.19 |   |   | (263.2 | )% |

|                                                                                                                                                                                                                                                             |                           | **For                the Three Months Ended****September 30,** |                               | **  **               |                               |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|---------------------------------------------------------------------|------------------------------------|--------------------------------|------------------------------------|
|                                                                                                                                                                                                                                                             |                           | **2006**                                                            | **     ** | **2005**                       | **     ** | **%                Change** |   |
|                                                                                                                                                                                                                                                             |                           | (dollar                amounts in thousands except per share data)  |                               |
|                                                                                                                                                                                                                                                             |            |                                                                |                               |                           |                               |   |   |   |   |   |
| Net                (loss) income                                                                                                                                                                                                                                 |                           | $                                                                   | (3,868)                            |       | $                                  | 2,859 |       |   | (235.3 | )% |
| Earnings                per share (basic)                                                                                                                                                                                                                        |                           | $                                                                   | (0.21)                             |                           | $                                  | 0.16 |   |   | (231.3 | )% |
| Earnings                per share                (diluted)                                  |       | $                                                                   | (0.21)                             |                           | $                                  | 0.16 |   |   | (231.3 | )% |

**Comparative      Net Interest Income**

|                                                                                                                                                                                                                                                                                                                                                                                                    |                           | **For                the Nine Months Ended****September 30,** |                               |                           |                         |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|--------------------------------------------------------------------|------------------------------------|--------------------------------|------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                    |                           | **2006**                                                           | **     ** | **2005**                       | **    ** | **%                Change** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                    |                           | (dollar                amounts in thousands)                       |                               |
|                                                                                                                                                                                                                                                                                                                                                                                                    |                           |                                                               |                               |                           |                         |   |   |   |   |   |
| Interest                income                                                                                                                                                                                                                                                                                                                                                                          |                           | $                                                                  | 62,205                             |                           | $                            | 56,484 |   |   | 10.1 | % |
| Interest                expense                                                                                                                                                                                                                                                                                                                                                                         |                           |                                                               | 54,260                             |                           |                         | 42,380 |   |   | 28.0 | % |
| Net                interest                income                                                          |       | $                                                                  | 7,945                              |       | $                            | 14,104 |       |   | (43.7 | )% |

|                                                                                                                                                                                                                                                                                                                                                                                  |                           | **For                the Three Months Ended****September 30,** |                               |                           |                         |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|---------------------------------------------------------------------|------------------------------------|--------------------------------|------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                  |                           | **2006**                                                            | **     ** | **2005**                       | **    ** | **%                Change** |   |
|                                                                                                                                                                                                                                                                                                                                                                                  |                           | (dollar                amounts in thousands)                        |                               |
|                                                                                                                                                                                                                                                                                                                                                                                  |                           |                                                                |                               |                           |                         |   |   |   |   |   |
| Interest                income                                                                                                                                                                                                                                                                                                                                                        |                           | $                                                                   | 20,878                             |                           | $                            | 19,698 |   |   | 6.0 | % |
| Interest                expense                                                                                                                                                                                                                                                                                                                                                       |                           |                                                                | 20,096                             |                           |                         | 16,159 |   |   | 24.4 | % |
| Net                interest                income                                                       |       | $                                                                   | 782                                |       | $                            | 3,539 |       |   | (77.9 | )% |

----

**Comparative      Other Non-Interest Related Expense**

|                                                                                                                                                                                |                               | **For                the Nine Months Ended****September                30,** |                         |     |                         |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------|------------------------------------------------------------------------------|------------------------------|----------|------------------------------|
|                                                                                                                                                                                | **     ** | **2006**                                                                     | **    ** | **2005** | **    ** | **%                Change** |   |
|                                                                                                                                                                                |                               | (dollar                amounts in thousands)                                 |                         |
|                                                                                                                                                                                |                               |                                                                         |                         |     |                         |   |   |   |   |   |
| Other                non-interest related                expenses                    |                               | $                                                                            | 39,916                       |     | $                            | 47,833 |   |   | (16.6 | )% |

|                                                                                                                                                                                                                    |                         | **For                the Three Months****Ended                September 30,** |                         | **  ** |                         |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------|-------------------------------------------------------------------------------|------------------------------|------------------|------------------------------|
|                                                                                                                                                                                                                    | **    ** | **2006**                                                                      | **    ** | **2005**         | **    ** | **%                Change** |   |
|                                                                                                                                                                                                                    |                         | (dollar                amounts in thousands)                                  |                         |
|                                                                                                                                                                                                                    |                         |                                                                          |                         |             |                         |   |   |   |   |   |
| Other                non-interest related                expenses                          |                         | $                                                                        | 11,684                       |             | $                       | 14,689 |   |   | (20.5 | )% |

*Net      Interest Income*

**Yields      Earned on Mortgage Loans and Securities and Rates on Financial Arrangements      **

**(dollar      amounts in thousands unless otherwise noted)**

|                                                                             |   | **The                Nine Months Ended****September                30, 2006** |    | **The                Nine Months Ended****September                30, 2005** |   |
|----------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------|---------|-------------------------------------------------------------------------------|--------|
|                                                                             |   | **Average                Balance**                                            |    | **Amount**                                                                    |   | **Yield/                Rate** |   | **Average                Balance** |   | **Amount ** |   | **Yield/                Rate** |   |
|                                                                             |   | ($                in millions)                                                |    |                                                                          |   |   |   | ($                in millions) |   |   |   |   |   |
| **Interest                Income:**                                              |   |                                                                          |    |                                                                          |   |   |   |   |   |   |   |   |   |
| Investment                securities and loans held in the securitization trusts |   | $                                                                             | 1,321.9 |                                                                          | $      | 51,682 |   |   | 5.21 | % | $ | 1,354.9 |   | $ | 45,403 |   |   | 4.47 | % |
| Loans                held for investment                                         |   |                                                                          | — |                                                                          |   | — |   |   | — |   |   | 142.0 |   |   | 5,388 |   |   | 5.06 | % |
| Loans                held for sale                                               |   |                                                                          | 220.5   |                                                                          |   | 12,155 |   |   | 7.35 | % |   | 308.4 |   |   | 10,573 |   |   | 4.57 | % |
| Amortization                of net premium                                       |   |                                                                          | 6.1     |                                                                          |   | (1,632 | ) |   | (0.16 | )% |   | 15.2 |   |   | (4,880 | ) |   | (0.42 | )% |
| Interest                income                                                   |   | $                                                                             | 1,548.5 |                                                                          | $      | 62,205 |   |   | 5.38 | % | $ | 1,820.5 |   | $ | 56,484 |   |   | 4.15 | % |
| **Interest                Expense:**                                             |   |                                                                          |         |                                                                          |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Investment                securities and loans held in the securitization trusts |   | $                                                                             | 1,248.7 |                                                                          | $      | 42,320 |   |   | 4.47 | % | $ | 1,292.9 |   | $ | 30,090 |   |   | 3.07 | % |
| Loans                held for investment                                         |   |                                                                          | — |                                                                          |   | — |   |   | — |   |   | 138.6 |   |   | 3,911 |   |   | 3.72 | % |
| Loans                held for sale                                               |   |                                                                          | 215.2   |                                                                          |   | 9,284 |   |   | 5.69 | % |   | 302.0 |   |   | 7,284 |   |   | 3.18 | % |
| Subordinated                debentures                                           |   |                                                                          | 45.0    |                                                                          |   | 2,656 |   |   | 7.78 | % |   | 20.5 |   |   | 1,095 |   |   | 7.06 | % |
| Interest                expense                                                  |   | $                                                                             | 1,508.9 |                                                                          | $      | 54,260 |   |   | 4.74 | % | $ | 1,754.0 |   | $ | 42,380 |   |   | 3.19 | % |
| Net                interest income                                               |   | $                                                                             | 39.6    |                                                                          | $      | 7,945 |   |   | 0.64 | % | $ | 66.5 |   | $ | 14,104 |   |   | 0.96 | % |

----

|                                                                             |   | **The                Three Months Ended****September                30, 2006** |    | **The                Three Months Ended****September                30, 2005** |   |
|----------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------|---------|--------------------------------------------------------------------------------|--------|
|                                                                             |   | **Average                Balance**                                             |    | ** Amount**                                                               |   | **Yield/                Rate** |   | **Average                Balance** |   | ** Amount ** |   | **Yield/                Rate** |   |
|                                                                             |   | ($                in millions)                                                 |    |                                                                      |   |    |   | ($                in millions) |   |    |   |    |   |
| **Interest                Income:**                                              |   |                                                                      |    |                                                                      |   |    |   |    |   |    |   |    |   |
| Investment                securities and loans held in the securitization trusts |   | $                                                                              | 1,281.3 |                                                                           | $      | 17,632 |   |   | 5.50 | % | $ | 1,348.4 |   | $ | 15,560 |   |   | 4.62 | % |
| Loans                held for investment                                         |   |                                                                           | — |                                                                           |   | — |   |   | — |   |   | 131.0 |   |   | 1,783 |   |   | 5.45 | % |
| Loans                held for sale                                               |   |                                                                           | 224.0   |                                                                           |   | 3,880 |   |   | 6.93 | % |   | 316.0 |   |   | 4,473 |   |   | 5.66 | % |
| Amortization                of net premium                                       |   |                                                                           | 6.4     |                                                                           |   | (634 | ) |   | (0.22 | )% |   | 14.7 |   |   | (2,118 | ) |   | (0.45 | )% |
| Interest                income                                                   |   | $                                                                              | 1,511.6 |                                                                           | $      | 20,878 |   |   | 5.53 | % | $ | 1,810.1 |   | $ | 19,698 |   |   | 4.35 | % |
| **Interest                Expense:**                                             |   |                                                                           |         |                                                                           |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Investment                securities and loans held in the securitization trusts |   | $                                                                              | 1,214.4 |                                                                           | $      | 15,882 |   |   | 5.12 | % | $ | 1,296.1 |   | $ | 10,751 |   |   | 3.25 | % |
| Loans                held for investment                                         |   |                                                                           | — |                                                                           |   | — |   |   | — |   |   | 126.0 |   |   | 1,366 |   |   | 4.24 | % |
| Loans                held for sale                                               |   |                                                                           | 218.0   |                                                                           |   | 3,337 |   |   | 5.99 | % |   | 310.0 |   |   | 3,441 |   |   | 4.34 | % |
| Subordinated                debentures                                           |   |                                                                           | 45.0    |                                                                           |   | 877 |   |   | 7.80 | % |   | 31.7 |   |   | 601 |   |   | 7.43 | % |
| Interest                expense                                                  |   | $                                                                              | 1,477.4 |                                                                           | $      | 20,096 |   |   | 5.33 | % | $ | 1,763.8 |   | $ | 16,159 |   |   | 3.58 | % |
| Net                interest income                                               |   | $                                                                              | 34.2    |                                                                           | $      | 782 |   |   | 0.20 | % | $ | 46.3 |   | $ | 3,539 |   |   | 0.77 | % |

| **As                of the Quarter Ended**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   | **Average****Interest****Earning****Assets** |    | **Historical****Weighted****Average****Coupon** |   | **Yield                on****Interest****Earning****Assets** |   | **Cost                of****Funds****Net                of****Hedging** |   | **Net****Interest****Spread** |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------|---------|-------------------------------------------------|--------|--------------------------------------------------------------|--------|-------------------------------------------------------------------------|--------|-------------------------------|--------|
|                                                                                                                |   | ($                in millions)               |    |                                       |   |                                                    |   |                                                               |   |                     |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                    |    |                                       |   |                                                    |   |                                                               |   |                     |   |
| September                30, 2006                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                                            | 1,287.6 |                                            |   | 5.50                                                         | %      |                                                                    | 5.28   | %                             |   | 5.12 | % |   | 0.16 | % |
| June                30, 2006                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                                         | 1,217.9 |                                            |   | 5.29                                                         | %      |                                                                    | 5.08   | %                             |   | 4.30 | % |   | 0.78 | % |
| March                31, 2006                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                                         | 1,478.6 |                                            |   | 4.85                                                         | %      |                                                                    | 4.75   | %                             |   | 4.04 | % |   | 0.71 | % |
| December                31, 2005                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                         | 1,499.0 |                                            |   | 4.84                                                         | %      |                                                                    | 4.43   | %                             |   | 3.81 | % |   | 0.62 | % |
| September                30, 2005                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                                         | 1,494.0 |                                            |   | 4.69                                                         | %      |                                                                    | 4.08   | %                             |   | 3.38 | % |   | 0.70 | % |
| June                30, 2005                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |                                         | 1,590.0 |                                            |   | 4.50                                                         | %      |                                                                    | 4.06   | %                             |   | 3.06 | % |   | 1.00 | % |
| March                31, 2005                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                                         | 1,447.9 |                                            |   | 4.39                                                         | %      |                                                                    | 4.01   | %                             |   | 2.86 | % |   | 1.15 | % |
| December                31, 2004                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |                                         | 1,325.7 |                                            |   | 4.29                                                         | %      |                                                                    | 3.84   | %                             |   | 2.58 | % |   | 1.26 | % |
| September                30, 2004                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                                            | 776.5   |                                            |   | 4.04                                                         | %      |                                                                    | 3.86   | %                             |   | 2.45 | % |   | 1.41 | % |

----

*Gain      on Sales of Mortgage Loans*

**Gain      on Sales of Mortgage Loans**

|                                                                                                                                                                                                                                          |   | **For                the Nine Months Ended****September 30,** |      |         |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------|-----------|--------------|--------|
|                                                                                                                                                                                                                                          |   | **2006**                                                           |      | **2005**     |   | **%                Change** |   |
|                                                                                                                                                                                                                                          |   | (dollar                amounts in thousands)                       |      |
| **Originations**                                                                                                                                                                                                                              |   |                                                          |      |    |   |    |   |
| Total                bankered loan volume                                                                                                                                                                                                     |   | $                                                                  | 1,402,457 |         | $      | 2,179,946 |   |   | (35.7 | )% |
| Total                bankered loan volume - units                                                                                                                                                                                             |   |                                                               | 6,128     |         |   | 9,908 |   |   | (38.2 | )% |
|                                                                                                                                                                                                                                          |   |                                                               |           |         |   |  |   |   |  |   |
| Bankered                originations retained for securitization                                                                                                                                                                              |   | $                                                                  | 69,739    |         | $      | 456,028 |   |   | (84.7 | )% |
| Bankered                originations retained for securitization -                units                          |   |                                                               | 134       |         |   | 1,067 |   |   | (87.4 | )% |
|                                                                                                                                                                                                                                          |   |                                                               |           |         |   |  |   |   |  |   |
| Net                bankered loan volume                                                                                                                                                                                                       |   | $                                                                  | 1,332,718 |         | $      | 1,723,918 |   |   | (22.7 | )% |
| Net                bankered loan volume - units                                                                                                                                                                                               |   |                                                               | 5,994     |         |   | 8,841 |   |   | (32.2 | )% |
|                                                                                                                                                                                                                                          |   |                                                               |           |         |   |  |   |   |  |   |
| **Shipped**                                                                                                                                                                                                                                   |   |                                                               |           |         |   |  |   |   |  |   |
| Total                bankered loan volume                                                                                                                                                                                                     |   | $                                                                  | 1,411,837 |         | $      | 2,148,778 |   |   | (34.3 | )% |
| Total                bankered loan volume - units                                                                                                                                                                                             |   |                                                               | 6,082     |         |   | 9,820 |   |   | (38.1 | )% |
|                                                                                                                                                                                                                                          |   |                                                               |           |         |   |  |   |   |  |   |
| Bankered                originations retained for securitization                                                                                                                                                                              |   | $                                                                  | 69,739    |         | $      | 456,028 |   |   | (84.7 | )% |
| Bankered                originations retained for securitization - units                                                                                                                                                                      |   |                                                               | 134       |         |   | 1,067 |   |   | (87.4 | )% |
|                                                                                                                                                                                                                                          |   |                                                               |           |         |   |  |   |   |  |   |
| Net                bankered loan volume                                                                                                                                                                                                       |   | $                                                                  | 1,342,098 |         | $      | 1,692,750 |   |   | (20.7 | )% |
| Net                bankered loan volume - units                                                                                                                                                                                               |   |                                                               | 5,948     |         |   | 8,753 |   |   | (32.0 | )% |
|                                                                                                                                                                                                                                          |   |                                                               |           |         |   |  |   |   |  |   |
| Gain                on sales of mortgage loans                                                                                                                                                                                                |   | $                                                                  | 14,399    |         | $      | 21,634 |   |   | (33.4 | )% |
| Average                gain on sale premium                                                                                                                                                                                                   |   |                                                               | 1.36      | %            |   | 2.07 | % |   | (34.3 | )% |

----

**Gain      on Sales of Mortgage Loans**

|                                                                                                                                                                                                                                          |   | **For                the Three Months Ended****September 30,** |    |         |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------|---------|--------------|--------|
|                                                                                                                                                                                                                                          |   | **2006**                                                            |    | **2005**     |   | **%                Change** |   |
|                                                                                                                                                                                                                                          |   | (dollar                amounts in thousands)                        |    |
| **Originations**                                                                                                                                                                                                                              |   |                                                           |    |    |   |    |   |
| Total                bankered loan volume                                                                                                                                                                                                     |   | $                                                                   | 462,300 |         | $      | 843,382 |   |   | (45.2 | )% |
| Total                bankered loan volume - units                                                                                                                                                                                             |   |                                                                | 2,067   |         |   | 3,797 |   |   | (45.6 | )% |
|                                                                                                                                                                                                                                          |   |                                                                |         |         |   |  |   |   |  |   |
| Bankered                originations retained for securitization                                                                                                                                                                              |   | $                                                                   | — |         | $      | 152,739 |   |   | (100.0 | )% |
| Bankered                originations retained for securitization -                units                          |   |                                                                | — |         |   | 341 |   |   | (100.0 | )% |
|                                                                                                                                                                                                                                          |   |                                                                |         |         |   |  |   |   |  |   |
| Net                bankered loan volume                                                                                                                                                                                                       |   | $                                                                   | 462,300 |         | $      | 690,643 |   |   | (33.1 | )% |
| Net                bankered loan volume - units                                                                                                                                                                                               |   |                                                                | 2,067   |         |   | 3,456 |   |   | (40.2 | )% |
|                                                                                                                                                                                                                                          |   |                                                                |         |         |   |  |   |   |  |   |
| **Shipped**                                                                                                                                                                                                                                   |   |                                                                |         |         |   |  |   |   |  |   |
| Total                bankered loan volume                                                                                                                                                                                                     |   | $                                                                   | 447,437 |         | $      | 816,017 |   |   | (45.2 | )% |
| Total                bankered loan volume - units                                                                                                                                                                                             |   |                                                                | 1,983   |         |   | 3,682 |   |   | (46.1 | )% |
|                                                                                                                                                                                                                                          |   |                                                                |         |         |   |  |   |   |  |   |
| Bankered                originations retained for securitization                                                                                                                                                                              |   | $                                                                   | — |         | $      | 152,739 |   |   | (100.0 | )% |
| Bankered                originations retained for securitization - units                                                                                                                                                                      |   |                                                                | — |         |   | 341 |   |   | (100.0 | )% |
|                                                                                                                                                                                                                                          |   |                                                                |         |         |   |  |   |   |  |   |
| Net                bankered loan volume                                                                                                                                                                                                       |   | $                                                                   | 447,437 |         | $      | 663,278 |   |   | (32.5 | )% |
| Net                bankered loan volume - units                                                                                                                                                                                               |   |                                                                | 1,983   |         |   | 3,341 |   |   | (40.6 | )% |
|                                                                                                                                                                                                                                          |   |                                                                |         |         |   |  |   |   |  |   |
| Gain                on sales of mortgage loans                                                                                                                                                                                                |   | $                                                                   | 4,348   |         | $      | 8,985 |   |   | (51.6 | )% |
| Average                gain on sale premium                                                                                                                                                                                                   |   |                                                                | 1.48    | %            |   | 2.05 | % |   | (27.8 | )% |

*Loan        losses-*

*Brokered      Loan Fees*

**Brokered      Loan Fees and Brokered Loan Expense**

|                                              |   | **For                the Nine Months Ended****September                30,** |    |         |   |
|---------------------------------------------------|--------|------------------------------------------------------------------------------|---------|--------------|--------|
|                                              |   | **2006**                                                                     |    | **2005**     |   | **%                Change** |   |
|                                              |   | (dollar                amounts in thousands)                                 |    |
|                                              |   |                                                                    |    |    |   |    |   |
| Total                brokered loan volume         |   | $                                                                            | 555,945 |         | $      | 434,508 |   |   | 27.9 | % |
| Total                brokered loan volume - units |   |                                                                         | 1,855   |         |   | 1,672 |   |   | 10.9 | % |
|                                              |   |                                                                         |         |         |   |  |   |   |  |   |
| Brokered                loan fees                 |   | $                                                                            | 8,672   |         | $      | 7,181 |   |   | 20.8 | % |
| Brokered                loan expenses             |   | $                                                                            | 6,609   |         | $      | 5,689 |   |   | 16.2 | % |

|                                              |   | **For                the Three Months Ended****September                30,** |    |         |   |
|---------------------------------------------------|--------|-------------------------------------------------------------------------------|---------|--------------|--------|
|                                              |   | **2006**                                                                      |    | **2005**     |   | **%                Change** |   |
|                                              |   | (dollar                amounts in thousands)                                  |    |
|                                              |   |                                                                     |    |    |   |    |   |
| Total                brokered loan volume         |   | $                                                                             | 140,509 |         | $      | 158,832 |   |   | (11.5 | )% |
| Total                brokered loan volume - units |   |                                                                          | 521     |         |   | 580 |   |   | (10.2 | )% |
|                                              |   |                                                                          |         |         |   |  |   |   |  |   |
| Brokered                loan fees                 |   | $                                                                             | 2,402   |         | $      | 2,647 |   |   | (9.3 | )% |
| Brokered                loan expenses             |   | $                                                                             | 1,674   |         | $      | 1,483 |   |   | 12.9 | % |
|                                              |   |                                                                          |    |         |   |   |   |   |   |   |

----

*Gain      on sale of securities and related hedges*

*Loss      on sale of current period securitized loans*

***Expenses***

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                               | **As                of September 30,**      |                         |     |                         |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------|---------------------------------------------|------------------------------|----------|------------------------------|
| **                                                                                                           ** | **     ** | **2006**                                    | **    ** | **2005** | **    ** | **%                Change** |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                               | (dollar                amounts in millions) |                         |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                               |                                        |                         |     |                         |   |   |   |   |   |
| Loan                officers                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                               |                                        | 378                          |     |                         | 365 |   |   | 3.6 | % |
| Other                employees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                               |                                        | 307                          |     |                         | 492 |   |   | (37.6 | )% |
| Total                employees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                               |                                        | 685                          |     |                         | 857 |   |   | (20.1 | )% |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                               |                                        |                         |     |                         |   |   |   |   |   |
| Number                of sales locations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                               |                                        | 50                           |     |                         | 66 |   |   | (24.2 | )% |

|                                                                                                                                                       |   | **For                the Nine Months Ended****September                30,** |   |     |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------|--------|----------|--------|
|                                                                                                                                                       |   | **2006**                                                                     |   | **2005** |   | **%                Change** |   |
|                                                                                                                                                       |   | (dollar                amounts in millions)                                  |   |
|                                                                                                                                                       |   |                                                                         |   |     |   |   |   |   |   |   |
| Salaries                and benefits                                                                                                                       |   | $                                                                            | 17.7   |     | $      | 23.9 |   |   | (25.9 | )% |
| Occupancy                and equipment                                                                                                                     |   |                                                                         | 3.9    |     |   | 5.0 |   |   | (22.0 | )% |
| Marketing                and promotion                                                                                                                     |   |                                                                         | 1.6    |     |   | 3.9 |   |   | (59.0 | )% |
| Data                processing and                communications                |   |                                                                         | 1.9    |     |   | 1.8 |   |   | 5.6 | % |
| Office                supplies and expenses                                                                                                                |   |                                                                         | 1.5    |     |   | 1.9 |   |   | (21.1 | )% |
| Travel                and entertainment                                                                                                                    |   |                                                                         | 0.4    |     |   | 0.7 |   |   | (42.9 | )% |
| Depreciation                and amortization                                                                                                               |   |                                                                         | 1.6    |     |   | 1.1 |   |   | 45.5 | % |

----

|                                                                                                                                                       |   | **For                the Three Months Ended****September                30,** |   |     |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------|--------|----------|--------|
|                                                                                                                                                       |   | **2006**                                                                      |   | **2005** |   | **%                Change** |   |
|                                                                                                                                                       |   | (dollar                amounts in millions)                                   |   |
|                                                                                                                                                       |   |                                                                          |   |     |   |   |   |   |   |   |
| Salaries                and benefits                                                                                                                       |   | $                                                                             | 5.4    |     | $      | 7.3 |   |   | (26.0 | )% |
| Occupancy                and equipment                                                                                                                     |   |                                                                          | 1.3    |     |   | 1.3 |   |   | — |   |
| Marketing                and promotion                                                                                                                     |   |                                                                          | 0.4    |     |   | 1.3 |   |   | (69.2 | )% |
| Data                processing and                communications                |   |                                                                          | 0.5    |     |   | 0.6 |   |   | (16.7 | )% |
| Office                supplies and expenses                                                                                                                |   |                                                                          | 0.4    |     |   | 0.7 |   |   | (42.9 | )% |
| Travel                and entertainment                                                                                                                    |   |                                                                          | 0.1    |     |   | 0.3 |   |   | (66.7 | )% |
| Depreciation                and amortization                                                                                                               |   |                                                                          | 0.5    |     |   | 0.3 |   |   | 66.7 | % |

*Salaries      and Benefits*

*Occupancy      and Equipment*

*Marketing      and Promotion*

*Data      Processing and Communications*

*Travel      and Entertainment*

*Professional      Fees Expense*

----

**Off-Balance      Sheet Arrangements**

**Liquidity      and Capital Resources**

----

|   | · | transfer                or sell assets; |
|--------|--------|-----------------------------------------|

|   | · | create                liens on the collateral; or |
|--------|--------|---------------------------------------------------|

|   | · | incur                additional indebtedness, without obtaining the prior consent of the                lenders, which consent may not be unreasonably                withheld. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the                loan is rejected as “unsatisfactory for purchase” by the ultimate investor                and has exceeded its permissible warehouse period which varies by                facility; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | we                fail to deliver the applicable note, mortgage or other documents                evidencing the loan within the requisite time                period; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the                underlying property that secures the loan has sustained a casualty                loss in                excess of 5% of its appraised value;                or |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the                loan ceases to be an eligible loan (as determined pursuant to the                warehouse facility agreement). |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | interest                rates on our loans compared to market interest                rates; |
|--------|--------|----------------------------------------------------------------------------------------------|

|   | · | the                borrower credit risk                classification; |
|--------|--------|------------------------------------------------------------------------|

|   | · | loan-to-value                ratios, loan terms, underwriting and documentation;                and |
|--------|--------|-----------------------------------------------------------------------------------------------------|

|   | · | general                economic conditions. |
|--------|--------|---------------------------------------------|

|   | · | sell                assets in adverse market                conditions; |
|--------|--------|-------------------------------------------------------------------------|

|   | · | borrow                on unfavorable terms; or |
|--------|--------|------------------------------------------------|

|   | · | distribute                amounts that would otherwise be invested in future acquisitions,                capital                expenditures or repayment of debt, in order to comply with the REIT                distribution requirements. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Inflation**

**Item      3. Quantitative and **
**Qualitative      Disclosures About Market Risk**

----

|   | · | Interest                rate and market (fair value) risk |
|--------|--------|-----------------------------------------------------------|

|   | · | Credit                spread risk |
|--------|--------|-----------------------------------|

|   | · | Liquidity                and funding risk |
|--------|--------|-------------------------------------------|

|   | · | Prepayment                risk |
|--------|--------|--------------------------------|

|   | · | Credit                risk |
|--------|--------|----------------------------|

**Interest      Rate Risk**

----

|                                                            |   | **As                of September 30, 2006** |      |
|-----------------------------------------------------------------|--------|---------------------------------------------|-----------|
|                                                            |   | **Notional                Amount**          |      | **Carrying                Amount** |   | **Estimated****Fair                Value** |   |
|                                                            |   |                                   |      |    |   |    |   |
| Investment                securities available for sale         |   | $                                           | 527,275   |   | $ | 523,969 |   | $ | 523,969 |   |
| Mortgage                loans held in the securitization trusts |   |                                        | 624,528   |   |   | 628,625 |   |   | 624,342 |   |
| Mortgage                loans held for sale                     |   |                                        | 109,095   |   |   | 109,197 |   |   | 110,538 |   |
| Commitments                and contingencies:                   |   |                                        |           |   |   |  |   |   |  |   |
| Interest                rate lock commitments                   |   |                                        | 258,368   |   |   | 506 |   |   | 506 |   |
| Forward                loan sales contracts                     |   |                                        | 176,543   |   |   | (686 | ) |   | (686 | ) |
| Interest                rate swaps                              |   |                                        | 285,000   |   |   | 717 |   |   | 717 |   |
| Interest                rate caps                               |   |                                        | 1,615,545 |   |   | 2,179 |   |   | 2,179 |   |

|                                                                         |   | **As                of December 31, 2005** |      |
|------------------------------------------------------------------------------|--------|--------------------------------------------|-----------|
|                                                                         |   | **Notional****Amount**                     |      | **Carrying****Amount** |   | **Estimated****Fair                Value** |   |
|                                                                         |   |                                  |      |    |   |    |   |
| Investment                securities available for sale                      |   | $                                          | 719,701   |   | $ | 716,482 |   | $ | 716,482 |   |
| Mortgage                loans held for investment                            |   |                                       | 4,054     |   |   | 4,060 |   |   | 4,079 |   |
| Mortgage                loans held in the securitization trusts              |   |                                       | 771,451   |   |   | 776,610 |   |   | 775,311 |   |
| Mortgage                loans held for sale                                  |   |                                       | 108,244   |   |   | 108,271 |   |   | 109,252 |   |
| Commitments                and contingencies:                                |   |                                       |           |   |   |  |   |   |  |   |
| Interest                rate lock commitments - loan commitments             |   |                                       | 130,320   |   |   | 123 |   |   | 123 |   |
| Interest                rate lock commitments - mortgage loans held for sale |   |                                       | 108,109   |   |   | (14 | ) |   | (14 | ) |
| Forward                loan sales contracts                                  |   |                                       | 201,771   |   |   | (380 | ) |   | (380 | ) |
| Interest                rate swaps                                           |   |                                       | 645,000   |   |   | 6,383 |   |   | 6,383 |   |
| Interest                rate caps                                            |   |                                       | 1,858,860 |   |   | 3,340 |   |   | 3,340 |   |

----

----

**Credit      Spread Exposure**

**Market      (Fair Value) Risk**

----

----

**Net      Portfolio Duration**
**      as of September 30, 2006**

|                                         |                               |     |                         | **Basis                Point Increase** |                         |
|----------------------------------------------|------------------------------------|----------|------------------------------|-----------------------------------------|------------------------------|
|                                         | **     ** | **Base** | **    ** | **+100**                                | **    ** | **+200** |   |
|                                         |                               |     |                         |                                    |                         |   |   |   |   |   |
| Mortgage                Portfolio            |                               |     | 0.98                years    |                                    |                         | 1.37                years |   |   | 1.52                years |   |
| Borrowings                (including hedges) |                               |     | 0.47                years    |                                    |                         | 0.47                years |   |   | 0.47                years |   |
| **Net**                                      |                               |     | 0.51                years    |                                    |                         | 0.90                years |   |   | 1.05                years |   |

**Liquidity      and Funding Risk**

----

**Prepayment      Risk**

**Credit      Risk**

----

**Item      4. Controls and Procedures**

*Evaluation      of Disclosure Controls and Procedures*

*Changes      in Internal Control over Financial Reporting*

----

**PART      II: OTHER INFORMATION**

**Item      1. Legal Proceedings**

**Item      **
**5.      Other Information**

**Item      6. Exhibits**

| **No.** |                                 | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|---------|--------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|    |                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 3.1     |        | Articles                of Amendment and Restatement of the Registrant (incorporated by reference                to Exhibit 3.01 to our Registration Statement on Form S-11/A filed                on                June 18, 2004 (Registration No. 333-111668)).                                                                                                                                                                                           |
|    |                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 3.2(a)  |                                 | Bylaws                of the Registrant (incorporated by reference to Exhibit 3.02 to our                Registration Statement on Form S-11/ A filed on June 18, 2004                (Registration No. 333-111668)).                                                                                                                                                                                                                                        |
|    |                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 3.2(b)  |                                 | Amendment                No. 1 to Bylaws of Registrant (incorporated by reference to Exhibit                3.2(b)                to Registrant’s Annual Report on Form 10-K filed on March 16,                2006)                                                                                                                                                                                                                                   |
|    |                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 4.1     |                                 | Form                of Common Stock Certificate (incorporated by reference to Exhibit                4.01 to                our Registration Statement on Form S-11/ A filed on June 18, 2004                (Registration No. 333-111668)).                                                                                                                                                                                                                 |
|    |                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 4.2     |                                 | (a)                Junior Subordinated Indenture between The New York Mortgage Company,                LLC                and JPMorgan Chase Bank, National Association, as trustee, dated                September 1, 2005 (incorporated by reference to Exhibit 4.1 to our                Current Report on Form 8-K filed on September 6,                2005).                                                                                      |
|    |                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 4.2(b)  |                                 | Amended                and Restated Trust Agreement among The New York Mortgage Company,                LLC,                JPMorgan Chase Bank, National Association, Chase Bank USA, National                Association and the Administrative Trustees named therein, dated                September 1, 2005 (incorporated by reference to Exhibit 4.2 to our                Current Report on Form 8-K filed on September 6,                2005). |
|    |                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 10.120  |                                 | Amendment                No. 11 to Amended and Restated Master Repurchase Agreement Among                Credit                Suisse First Boston Mortgage Capital LLC, The New York Mortgage Company                LLC, New York Mortgage Funding, LLC and New York Mortgage Trust,                Inc.                dated as of October 16, 2006.                                                                                                           |
|    |                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 10.121  |                                 | Amendment                No. 12 to Amended and Restated Master Repurchase Agreement Among                Credit                Suisse First Boston Mortgage Capital LLC, The New York Mortgage Company                LLC, New York Mortgage Funding, LLC and New York Mortgage Trust,                Inc.                dated as of November 9, 2006.                                                                                                           |
|    |                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 31.1    |                                 | Certification                of Co-Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a)                of the                Securities Exchange Act of 1934, as adopted pursuant to Section 302                of the                Sarbanes-Oxley Act of 2002.                                                                                                                                                                                         |
|    |                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 31.2    |                                 | Certification                of Co-Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a)                of the                Securities Exchange Act of 1934, as adopted pursuant to Section 302                of the                Sarbanes-Oxley Act of 2002.                                                                                                                                                                                         |
|    |                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 31.3    |                                 | Certification                of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of                the                Securities Exchange Act of 1934, as adopted pursuant to Section 302                of the                Sarbanes-Oxley Act of 2002.                                                                                                                                                                                            |

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| **No.** |   | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|---------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 32.1    |   | Certification                of Co-Chief Executive Officers pursuant to 18 U.S.C. Section 1350,                as                adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                (This                exhibit shall not be deemed “filed” for purposes of Section 18 of the                Securities Exchange Act of 1934, as amended, or otherwise subject                to the                liability of that section. Further, this exhibit shall not be deemed                to be                incorporated by reference into any filing under the Securities Act                of                1933, as amended, or the Securities Exchange Act of 1934, as                amended.). |
|    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 32.2    |   | Certification                of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as                adopted                pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (This exhibit                shall not be deemed “filed” for purposes of Section 18 of the Securities                Exchange Act of 1934, as amended, or otherwise subject to the liability                of                that section. Further, this exhibit shall not be deemed to be incorporated                by reference into any filing under the Securities Act of 1933, as                amended,                or the Securities Exchange Act of 1934, as                amended).                                    |

----

**SIGNATURES**

| Date:                November 9, 2006 | By:  | /s/                Steven B. Schnall                                                              |
|---------------------------------------|-----------|---------------------------------------------------------------------------------------------------|
|                                  |      | Steven                B. SchnallChairman,                President and Co-Chief Executive Officer |
|                                  |      |                                                                                              |
|                                  |      |                                                                                              |
| Date:                November 9, 2006 | By:  | /s/                David A. Akre                                                                  |
|                                  |      | David                A. AkreVice                Chairman and Co-Chief Executive Officer           |
|                                  |      |                                                                                              |
|                                  |      |                                                                                              |
| Date:                November 9, 2006 | By:  | /s/                Steven R. Mumma                                                                |
|                                  |      | Steven                R. MummaChief                Financial Officer                              |

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**EXHIBIT      INDEX**

| **No.** |                                       | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|---------|--------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 3.1     |         | Articles                of Amendment and Restatement of the Registrant (incorporated by reference                to Exhibit 3.01 to our Registration Statement on Form S-11/A filed                on                June 18, 2004 (Registration No. 333-111668)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 3.2(a)  |                                       | Bylaws                of the Registrant (incorporated by reference to Exhibit 3.02 to our                Registration Statement on Form S-11/ A filed on June 18, 2004                (Registration No. 333-111668)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 3.2(b)  |                                       | Amendment                No. 1 to Bylaws of Registrant (incorporated by reference to Exhibit                3.2(b)                to Registrant’s Annual Report on Form 10-K filed on March 16,                2006)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 4.1     |                                       | Form                of Common Stock Certificate (incorporated by reference to Exhibit                4.01 to                our Registration Statement on Form S-11/ A filed on June 18, 2004                (Registration No. 333-111668)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 4.2(a)  |                                       | Junior                Subordinated Indenture between The New York Mortgage Company, LLC                and                JPMorgan Chase Bank, National Association, as trustee, dated                September 1, 2005 (incorporated by reference to Exhibit 4.1 to our                Current Report on Form 8-K filed on September 6,                2005).                                                                                                                                                                                                                                                                                                                                                                           |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 4.2(b)  |                                       | Amended                and Restated Trust Agreement among The New York Mortgage Company,                LLC,                JPMorgan Chase Bank, National Association, Chase Bank USA, National                Association and the Administrative Trustees named therein, dated                September 1, 2005 (incorporated by reference to Exhibit 4.2 to our                Current Report on Form 8-K filed on September 6,                2005).                                                                                                                                                                                                                                                                                  |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 10.120  |                                       | Amendment                No. 11 to Amended and Restated Master Repurchase Agreement Among                Credit                Suisse First Boston Mortgage Capital LLC, The New York Mortgage Company                LLC, New York Mortgage Funding, LLC and New York Mortgage Trust,                Inc.                dated as of October 16, 2006.                                                                                                                                                                                                                                                                                                                                                                                            |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 10.121  |                                       | Amendment                No. 12 to Amended and Restated Master Repurchase Agreement Among                Credit                Suisse First Boston Mortgage Capital LLC, The New York Mortgage Company                LLC, New York Mortgage Funding, LLC and New York Mortgage Trust,                Inc.                dated as of November 9, 2006.                                                                                                                                                                                                                                                                                                                                                                                            |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 31.1    |                                       | Certification                of Co-Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a)                of the                Securities Exchange Act of 1934, as adopted pursuant to Section 302                of the                Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 31.2    |                                       | Certification                of Co-Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a)                of the                Securities Exchange Act of 1934, as adopted pursuant to Section 302                of the                Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 31.3    |                                       | Certification                of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of                the                Securities Exchange Act of 1934, as adopted pursuant to Section 302                of the                Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 32.1    |                                       | Certification                of Co-Chief Executive Officers pursuant to 18 U.S.C. Section 1350,                as                adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                (This                exhibit shall not be deemed “filed” for purposes of Section 18 of the                Securities Exchange Act of 1934, as amended, or otherwise subject                to the                liability of that section. Further, this exhibit shall not be deemed                to be                incorporated by reference into any filing under the Securities Act                of                1933, as amended, or the Securities Exchange Act of 1934, as                amended.). |
|    |                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 32.2    |                                       | Certification                of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as                adopted                pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (This exhibit                shall not be deemed “filed” for purposes of Section 18 of the Securities                Exchange Act of 1934, as amended, or otherwise subject to the liability                of                that section. Further, this exhibit shall not be deemed to be incorporated                by reference into any filing under the Securities Act of 1933, as                amended,                or the Securities Exchange Act of 1934, as                amended.).                                   |

----