**Exhibit31.2**

**CERTIFICATIONPURSUANT TO SECTION 302OF THE SARBANES-OXLEY ACT OF 2002**

I, William M. Baker,certify that:

1.             I have reviewed this Quarterly Report on Form 10-QSB ofKH Funding Company;

2.             Based on my knowledge, this quarterly report does not containany untrue statement of a material fact or omit to state a material factnecessary to make the statements made, in light of the circumstances underwhich such statements were made, not misleading with respect to the periodcovered by this quarterly report;

3.             Based on my knowledge, the financial statements, andother financial information included in this quarterly report, fairly presentin all material respects the financial condition, results of operations andcash flows of the small business issuer as of, and for, the periods presentedin this quarterly report;

4.             The small business issuer’s  other certifying officer and I areresponsible for establishing and maintaining disclosure controls and procedures(as defined in Exchange Act Rules 13a-14 and 15d-14) for the small businessissuer and we have:

(a)   designed suchdisclosure controls and procedures, or caused such disclosure controls andprocedures to be designed under our supervision, to ensure that materialinformation relating to the small business issuer, including its consolidatedsubsidiaries, is made known to us by others within those entities, particularlyduring the period in which this quarterly report is being prepared;

(b)   evaluated theeffectiveness of the small business issuer’s disclosure controls and proceduresand presented in the quarterly report our conclusions about the effectivenessof the disclosure controls and procedures, as of the end of the period covered by this report based on suchevaluation; and

(c)   disclosed inthis report any change in the small business issuer’s internal control overfinancial reporting that occurred during the small business issuer’s mostrecent fiscal quarter (the small business issuer’s fourth fiscal quarter in thecase of an annual report) that has materially affected, or is reasonably likelyto materially affect, the small business issuer’s internal control overfinancial reporting.

5.             The small business issuer’s other certifying officer andI have disclosed, based on our most recent evaluation of internal control overfinancial reporting, to the small business issuer’s auditors and the auditcommittee of small business issuer’s board of directors (or persons performingthe equivalent functions):

(a)   all significantdeficiencies and material weaknesses in the design or operation of internalcontrol over financial reporting which are reasonably likely to adverselyaffect the small business issuer’s ability to record, process, summarize andreport financial information; and

(b)   any fraud,whether or not material, that involves management or other employees who have asignificant role in the small business issuer’s internal control over financialreporting.
| Dated: May 22, 2007 |   | /s/ William M. Baker    |
|---------------------|--------|-------------------------|
|                |   | William M. Baker        |
|                |   | Chief Financial Officer |

 

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