<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

                  QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000

                                   ----------

                       Commission file number: 33-49261-D

                        TRANSITION AUTO FINANCE II, INC.
        (EXACT NAME OF SMALL BUSINESS ISSUER AS SPECIFIED IN ITS CHARTER)

          TEXAS                                         75-2753067
(State of incorporation)                 (I.R.S. employer identification number)

   8144 Walnut Hill Lane, SUITE 680,
             DALLAS, TEXAS                                 75231
(Address of principal executive offices)                 (Zip code)

                   Issuer's telephone number, including area code: (214)360-9966

Check whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12
months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days. Yes | | No |X|

State the number of shares outstanding of each of the issuer's classes of Common
equity, as of the latest practicable date: As June 30, 2000, the issuer' had
1,000 shares of common stock

    TRANSITIONAL SMALL BUSINESS DISCLOSURE FORMS (CHECK ONE): Yes | | No |X|

================================================================================
<PAGE>

                        TRANSITION AUTO FINANCE II, INC.

                                   FORM 10-QSB

                       FOR THE QUARTER ENDED JUNE 30, 2000

<TABLE>
<CAPTION>
                                                                              Page No.
                                                                              --------
<S>                                                                           <C>
PART I.  FINANCIAL INFORMATION

    ITEM 1. Financial Statements

         Balance Sheets ...................................................      3
           June 30, 2000 (Unaudited) and December 31, 1999

         Statements of Income (Unaudited) .................................      5
           Quarter and six months ended June 30, 2000 and June 30, 1999

         Statements of Cash Flows (Unaudited) .............................      6
           Six Months ended June 30, 2000 and June 30, 1999

         Notes to  Financial Statements (Unaudited) .......................      7

    ITEM 2. Management's Discussion and Analysis of
            Financial Condition and Results of Operations .................     11

PART II. OTHER INFORMATION

    ITEM 1. Legal Proceedings .............................................     12

    ITEM 2. Changes in Securities and Use of Proceeds .....................     12

    ITEM 3. Defaults Upon Senior Securities ...............................     13

    ITEM 4. Submission of Matters to a Vote of Security Holders ...........     13

    ITEM 5. Other Information .............................................     13

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

    Signatures ............................................................     14
</TABLE>

      In the opinion of management, all adjustments necessary to a fair
statement of the results for interim periods presented have been reflected in
these financial statements.


                                       2
<PAGE>

                          PART I. FINANCIAL INFORMATION

                          ITEM 1. FINANCIAL STATEMENTS

                        TRANSITION AUTO FINANCE II, INC.

                                 BALANCE SHEETS

                                     ASSETS

<TABLE>
<CAPTION>
                                                                      6 months ended         FYE
                                                                         6/30/2000        12/31/1999
                                                                        (unaudited)      (See Note 1)
                                                                        -----------      ------------
<S>                                                                   <C>                <C>
CURRENT ASSETS
  Cash and cash equivalents                                             $   449,352      $ 2,483,593
  Accounts receivable                                                       357,401          310,338
  Vehicles held for sale                                                        -0-          213,052
                                                                        -----------      -----------
      Total Current Assets                                                  806,753        3,006,983
                                                                        -----------      -----------

PROPERTY, at cost
  Vehicles leased                                                         9,571,624        6,988,584
  Less accumulated depreciation                                          (2,197,660)      (1,890,738)
                                                                        -----------      -----------
      Net Property                                                        7,373,964        5,097,846
                                                                        -----------      -----------

OTHER ASSETS
  Debt issuance costs, net of amortization of $491,874 and $335,651         624,968          766,116
                                                                        -----------      -----------

TOTAL ASSETS                                                            $ 8,805,685      $ 8,870,945
                                                                        ===========      ===========
</TABLE>


                                       3
<PAGE>

                        TRANSITION AUTO FINANCE II, INC.

                           BALANCE SHEETS (Continued)

                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

<TABLE>
<CAPTION>
                                                             6 Months Ended          FYE
                                                                6/30/2000        12/31/1999
CURRENT LIABILITIES                                            (Unaudited)      (See Note 1)
                                                               -----------      ------------
<S>                                                          <C>                <C>
  Accrued liabilities                                         $    231,860      $    519,702
  Current portion of deferred revenue                              558,693           309,216
                                                              ------------      ------------
        Total Current Liabilities                                  790,553           828,918
                                                              ------------      ------------

OTHER LIABILITIES
  Due to affiliate                                                 186,726           210,569
  Deferred revenue                                                 711,064           446,332
  Investor notes payable                                        10,000,000        10,000,000
                                                              ------------      ------------
      Total Other Liabilities                                   10,897,790        10,656,901
                                                              ------------      ------------

TOTAL LIABILITIES                                               11,688,343        11,485,819
                                                              ------------      ------------

SUBORDINATED DEBT TO AFFILIATE                                     371,330           371,330
                                                              ------------      ------------

STOCKHOLDERS' EQUITY (DEFICIT)
   Common stock, $.10 par value, 1,000 shares authorized,
      issued and outstanding                                           100               100
   Additional paid-in capital                                          900               900
   Retained earnings (deficit)                                  (3,254,988)       (2,987,204)
                                                              ------------      ------------
      Total Stockholders' Equity (Deficit)                      (3,253,988)       (2,986,204)
                                                              ------------      ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
   (DEFICIT)                                                  $  8,805,685      $  8,870,945
                                                              ============      ============
</TABLE>

      Note 1: The balance sheet at December 31, 1999, as presented, is derived
      from the audited financial statements at that date.


                                       4
<PAGE>

                        TRANSITION AUTO FINANCE II, INC.

                              STATEMENTS OF INCOME

                                   (Unaudited)

<TABLE>
<CAPTION>
                                       Quarter Ended   Six Months Ended    Quarter Ended   Six Months Ended
                                       June 30, 2000      June 30, 2000    June 30, 1999      June 30, 1999
                                       -------------      -------------    -------------      -------------
<S>                                    <C>             <C>                 <C>             <C>
REVENUES

  Vehicle monthly lease payments           $ 732,218        $ 1,207,608        $ 279,518          $ 442,530
   Amortization of down payments             148,062            259,316           23,950             40,802
                                           ---------        -----------        ---------          ---------

        Total Revenues                       880,280          1,466,924          303,468            483,332
                                           ---------        -----------        ---------          ---------

OPERATING EXPENSES

  Operating costs                             70,137            415,306          118,910            170,613
  General and administrative                     294             15,346            9,733             13,413
  Depreciation and amortization              421,542            796,182          257,966            461,704
  Impairment loss                                -0-                -0-              -0-                -0-
                                           ---------        -----------        ---------          ---------

        Total Operating Expenses             491,973          1,226,834          386,609            645,730
                                           ---------        -----------        ---------          ---------

Operating Income (Loss)                      388,307            240,090          (83,141)          (162,398)
                                           ---------        -----------        ---------          ---------

OTHER INCOME (EXPENSE)

Investment income                              1,816             27,516           24,483             26,203
Other income (expense)                           -0-             17,684              -0-                -0-
Interest expense                            (275,100)          (550,230)        (232,499)          (407,284)
Loss on sale of inventory                     14,469             (2,845)             -0-                -0-
                                           ---------        -----------        ---------          ---------

        Total Other Income (Expense)        (258,815)          (507,875)        (208,016)          (381,081)
                                           ---------        -----------        ---------          ---------

Provision for Federal Income Taxes               -0-                -0-              -0-                -0-
                                           ---------        -----------        ---------          ---------

Net Profit (Loss)                          $ 129,492        $  (267,785)       $(291,157)         $(543,479)
                                           =========        ===========        =========          =========

Earning (Loss) per share (basic and
diluted)                                   $  129.49        $   (267.79)       $ (291.16)         $ (543.48)
</TABLE>


                                       5
<PAGE>

                        TRANSITION AUTO FINANCE II, INC.

                            STATEMENTS OF CASH FLOWS

                                   (Unaudited)

<TABLE>
<CAPTION>
                                                               6 Months Ended     6 Months Ended
                                                                June 30, 2000      June 30, 1999
                                                                -------------      -------------
<S>                                                            <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss                                                          $  (267,785)       $  (543,479)
Adjustments to reconcile net income to net cash provided by
  operating activities:
     Depreciation and amortization                                    796,182            461,704
     Amortization of down payments                                   (259,316)           (40,802)
     Impairment loss                                                      -0-                -0-
     Provision for allowance for doubtful accounts                        -0-                -0-
     (Gain) loss on sale of property                                    2,845                -0-
Net changes in operating assets and liabilities:
     Accounts receivable                                              (47,063)               -0-
     Accrued liabilities                                             (287,842)            43,718
     Deferred revenue                                                 773,525            261,407
                                                                  -----------        -----------
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES                      710,546            182,548
                                                                  -----------        -----------

CASH FLOWS FROM INVESTING ACTIVITIES
   Purchase of fixed assets                                        (3,029,161)        (4,302,969)
   Cash proceeds from sale of property                                323,293            156,148
                                                                  -----------        -----------
NET CASH (USED) BY INVESTING ACTIVITIES                            (2,705,868)        (4,146,821)
                                                                  -----------        -----------

CASH FLOWS FROM FINANCING ACTIVITIES
   Proceeds from issuance of common stock                                 -0-                -0-
   Net advances (payments) to affiliates                              (23,843)          (129,846)
   Debt issuance costs                                                (15,076)          (295,716)
   Proceeds from notes payable                                            -0-          5,122,600
                                                                  -----------        -----------
NET CASH PROVIDED  BY FINANCING ACTIVITIES                            (38,919)         4,697,038
                                                                  -----------        -----------

NET INCREASE (DECREASE)  IN CASH                                   (2,034,241)           732,765

CASH AND CASH EQUIVALENTS, beginning of period                      2,483,593          3,227,839
                                                                  -----------        -----------

CASH AND CASH EQUIVALENTS, end of period                          $   449,352        $ 3,960,604
                                                                  ===========        ===========

CASH PAID DURING THE YEAR FOR
   Interest                                                       $   550,200        $   232,479
                                                                  ===========        ===========
   Income taxes                                                   $       -0-        $       -0-
                                                                  ===========        ===========
</TABLE>

NON-CASH INVESTING ACTIVITIES

Vehicles purchased during the six months ended June 30, 2000 with a net book
value of $76,993 were reclassified from vehicles leased to vehicles held for
sale.

                                       6
<PAGE>

                        TRANSITION AUTO FINANCE II, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

                                  JUNE 30, 2000

NOTE 1: BUSINESS ACTIVITY

        The Company was established to purchase motor vehicles and automobile
        lease contracts, collect and service automobile lease contracts and
        remarket motor vehicles upon termination of their leases. A summary of
        the significant accounting policies consistently applied in the
        preparation of the accompanying financial statements follows. Transition
        Leasing Management, Inc. (TLMI) owns 100% of the Company's common stock.

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        CASH AND CASH EQUIVALENTS

            For purposes of the statement of cash flows, the Company considers
            all highly liquid investments with a maturity of three months or
            less when purchased to be cash equivalents.

            The Company maintains cash balances at financial institutions in
            Dallas, Texas. Accounts at the institutions are insured by the
            Federal Deposit Insurance Corporation up to $100,000. The Company
            has not experienced any losses in such accounts and believes it is
            not exposed to any significant credit risk on cash and cash
            equivalents.

      REVENUE

            The vehicles are leased to individuals under leases with terms
            ranging from thirty-six to forty-two months. The leases are
            considered to be operating leases. At the end of the lease period,
            the lessee may purchase the equipment at the contractual residual
            value plus any other outstanding items due. Monthly lease payments
            are recognized as revenue in the month that the payments are due.
            The vehicle leases require a down payment from the lessee at the
            inception of the lease.

            The down payments are initially recorded as deferred revenue and
            then recognized as income over the term of the leases on a
            straight-line basis.

      VEHICLES HELD FOR SALE

            Vehicles held for sale are leased vehicles in which the lease term
            has expired or that have been repossessed. Vehicles held for sale
            are valued at the lower of book value or market value. Generally
            these vehicles will be sold at auction by the Company.


                                       7
<PAGE>

                        TRANSITION AUTO FINANCE II, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

                                  JUNE 30, 2000

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

        EQUIPMENT AND LEASED VEHICLES

            Equipment and leased vehicles are stated at cost less accumulated
            depreciation. Depreciation is provided in amounts sufficient to
            relate the cost of depreciable assets to operations over their
            estimated service lives using the straight-line-method. Leased
            vehicle depreciation is calculated over the term of the vehicle
            lease, using the cost of the vehicle less the estimated residual
            value of the vehicle at the end of the lease. Present leases have
            terms ranging from thirty-six to forty-two months.

            The Company adopted Financial Accounting Standards Board issued
            Statement No. 121, Accounting for the Impairment of Long-Lived
            Assets and for Long-Lived Assets to Be Disposed Of, which requires
            impairment losses to be recorded on long-lived assets used in
            operations when indicators of impairment are present. An impairment
            loss of $617,684 has been recorded in these financial statements for
            the year ended December 31, 1999.

      OTHER ASSETS

            Other assets include debt issuance costs incurred in connection with
            the Company's offering of securities filed with the Securities and
            Exchange Commission. These costs are being amortized, on a
            straight-line basis, over the term of the debt securities which
            mature on June 30, 2002.

      DEFERRED REVENUE

            Deferred revenue consists of down payments made by lessees at the
            inception of the lease. The down payments are amortized over the
            lease term. Lease terms range from thirty-six to forty-two months.

      FAIR VALUE OF FINANCIAL INSTRUMENTS

            Fair values of financial instruments are estimated to approximate
            the related book value, unless otherwise indicated, based on market
            information available to the Company.


                                       8
<PAGE>

                        TRANSITION AUTO FINANCE II, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

                                  JUNE 30, 2000

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

        USE OF ESTIMATES

            In preparing the Company's financial statements, management is
            required to make estimates and assumptions that affect the reported
            amounts of assets and liabilities, the disclosure of contingent
            assets and liabilities at the date of the financial statements, and
            the reported amounts of revenues and expenses during the reporting
            period. Actual results could differ from these estimates.

      CONCENTRATION OF CREDIT RISK

            A majority of the lessees are residents of the Dallas/Fort Worth
            Metroplex. Vehicles are used as collateral for leases.

NOTE 3: INVESTOR NOTES PAYABLE

        The Company has issued fixed rate redeemable asset-backed notes
        (Investor Notes) as of December 1999 in the amount of $10,000,000.

        These Investor Notes were issued pursuant to a public offering on Form
        SB-2 under the Securities Act of 1933. The Investor Notes bear interest
        at the rate of 11%. Interest is payable monthly on the 15th day of each
        month.

        The Investor Notes were issued at various times during 1999 and 1998,
        however the maturity date for all of the Investor Notes is June 30,
        2002. The Investor Notes are collateralized by the following:

            1.    Automobile contracts for the leasing of new or late model
                  automobiles.
            2.    The leased vehicles.


                                       9
<PAGE>

                        TRANSITION AUTO FINANCE II, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

                                  JUNE 30, 2000

NOTE 4: INCOME TAXES

        The Company is a corporation subject to federal and state income taxes.
        The Company and its parent intend to file a consolidated tax return.
        Each company in the consolidated group determines its taxable income or
        loss, on a separate company basis, and the consolidated tax liability is
        allocated to each company with taxable income in proportion to the total
        of the taxable income amounts.

        The Company has a deferred tax asset as of December 31, 1999 (primarily
        from net operating loss carryforward), which has been completely offset
        by recognition of a valuation allowance.

        The Company has a net operating loss (NOL) carryforward of approximately
        $1,450,000 for the year ended December 31, 1999. The Company's NOL
        carryforward expires between December 31, 2011 and December 31, 2019.

NOTE 5: RELATED PARTIES

        The Company has entered into a Servicing Agreement with TLMI. TLMI will
        be entitled to a servicing fee of $20 per month per contract and a
        payment of $150 per contract purchased. TLMI will receive, as a
        marketing fee, 57.5% of the down payment made by the customers with
        respect to contracts it originates. TLMI will receive from the Company a
        Releasing Fee of 57.5% of the down payment with respect to a new
        contract following repossession of a leased vehicle.

NOTE 6: SUBORDINATED DEBT TO AFFILIATE

        The Company assumed a liability of $371,330 due to TLMI. This debt is
        subordinated to all other Company liabilities and can not be repaid
        before any other creditors or investors.


                                       10
<PAGE>

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

      The following discussions and analysis relates to factors that have
affected the operating results of the Company for the quarter ended and six-
month period ended June 30, 2000. The balance sheet at December 31, 1999, as
presented, is derived from the audited financial statements at that date.

General.

      As of December 31, 1999, the Company had sold $10,000,000 of its 11%
Redeemable Secured Notes. In February of 1999 the Company also purchased 116
lease contracts from Transition Auto Finance, Inc. for $2,883,000.

Results of Operations: Three months ended June 30, 2000, compared to three
months ended June 30,1999

      For the three months ended June 30, 2000 the Company had received monthly
contract lease payments of $732,218 and amortization of down payments of
$148,062. For the same period in 1999, the Company had contract lease income of
$279,518, amortization of down payments of $23,950. The increase in monthly
contract lease payments of $452,700 for the three month period ended June, 30,
2000, compared to the same period in 1999, was the result of a substantial
increase in lease activity for the 2000 period compared to the same period in
1999.

      Operating costs including general and administrative expenses were $70,431
for the second quarter of 2000 compared to $128,643 for the same period in 1999.
The decline in operating expenses for the second quarter of 2000 compared to the
second quarter in 1999 was due to fewer marketing fees paid in the 2000 quarter.
Marketing fees vary depending on the level of lease activity in a given period.

      Depreciation and amortization was $421,542 for the three months ended June
30, 2000, compared to $257,966 for the same period in 1999. The increase for the
2000 period reflects the increased number of leases on the company's books.

      Interest expense for the three months ended June 30, 2000, was $275,100
compared to $232,499 for the same period in 2000.

      Gain on sale of inventory for the second quarter of 2000 was $14,469
compared to no losses for the same period in 1999. Loss on sale of inventory
occurs when the book value of the asset exceeds the market value of the
repossessed vehicle.

      The net profit for the second quarter ended June 30, 2000 was $129,492
compared to a loss of $291,157 for the same period in 1999. The profit for the
2000 period reflects the large number of leases added in the quarter ended June
30, 2000.

Results of Operations: Six- month period ended June 30, 2000 compared to six
months ended June 30,1999

      Total revenue for the six months ended June 30, 2000 was $1,466,924
compared to $483,332 for the same period in 1999. The increase in revenue for
the 2000 period was due to a substantial increase in lease activity compared to
the same period in 1999.

      Operating costs and expenses were $430,652 for the six-month period ended
June 30, 2000 compared to $184,026 for the same period in 1999, an increase in
2000 of $246,626, or 134%. The increase was primarily due to marketing fees paid
as a result of an increase in lease production for the six month period ending
June 30, 2000.

      Depreciation and amortization for the six months ended June 30, 2000 was
$796,182, compared to $461,704 for the same period in 1999. The increase in
depreciation for the 2000 period was due to a larger number of vehicles leased
in the 2000 period than in the 1999 period.

      Interest expense for the six months ended June 30, 2000 was $550,230
compared to 407,284 for the same period in 1999. The increase in interest
expense in the 2000 period was due to a larger number of notes outstanding in
2000 than in the 1999 period.


                                       11
<PAGE>

      Loss on sale of inventory for the six month ended June 30, 2000 was $2,845
to no losses loss for the same period in 1999.

      The Company had a loss of $ 267,785 for the six months ended June 30, 2000
compared to a loss of $543,479 for the same period in 1999. The decreased loss
of $275,694 was primarily due to an increase in revenue for the 2000 period of
$983,592.

Liquidity and Capital Resources

      During the six months ended June 30, 2000 the Company had cash used in its
investing activities of $2,705,868 and used $38,919 in its financing activities.
For the same period in 1999, the Company utilized cash of $4,146,821 in its
investing activities and received $4,697,038 in its financing activities.

      The Company's only source of liquidity in the future will be from its
remaining cash from note sales and monthly lease payments after interest and
other allowed expenses.

      The Company's portfolio, which consisted of 478 leases, included 63 leases
resulting in early terminations. The information on the Company's experience
with respect to early terminations is set forth below:

<TABLE>
<CAPTION>
                                                                   Vehicle                                     Total
                # of     Gross Cost    Misc.    Total      Down      Sale    Sales Tax  Warranty  Marketing    Amount     Profit
              Contracts  Of Vehicle  Expenses  Payments  Payment    Amount    Credit     Rebate    Fee Paid   Received    (Loss)
<S>           <C>        <C>         <C>       <C>       <C>       <C>       <C>        <C>       <C>        <C>         <C>
Repossession      28     $  549,185   $12,074  $263,237  $ 92,775  $265,169   $16,573    $ 4,545   $ 49,552  $  592,748  $ 31,488
Early Payoff      35     $  807,921   $   457  $334,344  $159,798  $591,519   $36,970    $ 7,385   $ 91,990  $1,038,025  $229,647
                  --     ----------   -------  --------  --------  --------   -------    -------   --------  ----------  --------
Total             63     $1,357,106   $12,531  $597,581  $252,573  $856,688   $53,543    $11,930   $141,542  $1,630,773  $261,135
</TABLE>

Note: The above results on early termination does not include any allowance for
interest expense

      This report contains various forward looking statements and information
that are based on management's belief as well as assumptions made by and
information currently available to management. Although the Company believes
that the expectations reflected in such forward-looking statements are
reasonable, it can give no assurance that such expectations will prove to have
been correct. Such statements are subject to certain risks, uncertainties and
assumptions. Should one or more of these risks or uncertainties materialize, or
should underlying assumptions prove incorrect, actual results may vary
materially from those expected. Among the key factors that may have a direct
bearing on the Company's operating results are fluctuations in the economy and
in the level of activity in the automobile and consumer finance industry, demand
for the Company's products, the impact of competition and interest rate
fluctuations.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

      The Company is not a party to any material legal proceedings, and no
material legal proceedings have been threatened by or, to the best of the
Company's knowledge, instituted against the Company.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

      (a) Not Applicable
      (b) Not Applicable
      (c) Not Applicable
      (d) The company applied 90% of the gross proceeds from the sale of the
      Notes to the purchase or


                                       12
<PAGE>

      acquisition of the Leased Vehicles and the contracts. The Company paid to
      the Underwriter sales commissions of 6% of the principal amount of the
      Notes sold by the Underwriter. Additionally, the Company reimbursed the
      Underwriter for certain expenses incurred in connection with its due
      diligence activities with regard to the Offering of 2.5% of the aggregate
      principal amount of the Notes sold. The Company also used 1.5% of the
      gross proceeds from the sale of the Notes to pay offering and
      organizational expenses, including filing and registration fees, legal
      fees of the Company's counsel, accounting fees, trustee's fees, escrow
      agent's fees, "blue sky" expenses and printing expenses.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      No matters were submitted to a vote of the Company's sole stockholder
during the second quarter of 2000.

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a)   Financial Statements

      The following financial statements are filed as a part of this Form
      10-KSB:

            The Index to Financial Statements is set out in Item 7 herein.

      Exhibits

      The following exhibits are filed as exhibits to this report on Form
      10-KSB:

            The information required is set forth in the Index to Exhibits
            accompanying this Form 10-QSB.

(b)   Reports on Form 8-K

      No reports on Form 8-K were filed during the six months ended June 30,
      2000


                                       13
<PAGE>

                                   SIGNATURES

      In accordance with section 13 or 15(d) of the Exchange Act, the registrant
has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                            TRANSITION AUTO FINANCE II, INC.
                                        ----------------------------------------
                                                     (Registrant)


Date: March 19, 2002                             /s/ KENNETH C. LOWE
      --------------------              ----------------------------------------
                                              Kenneth C. Lowe, President/
                                              Chief Executive Officer


Date: March 19, 2002                             /s/ KENNETH C. LOWE
      --------------------              ----------------------------------------
                                              Kenneth C. Lowe, President/
                                              Chief Operating Officer


Date: March 19, 2002                             /s/ KENNETH C. LOWE
      --------------------              ----------------------------------------
                                              Kenneth C. Lowe, President/
                                              Chief Financial Officer


                                       14
<PAGE>

                                INDEX TO EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT
NUMBER                                DESCRIPTION
<S>         <C>
3.1         Articles of Incorporation of Transition Auto Finance II, Inc. *

3.2         Bylaws of Transition Auto Finance II, Inc. *

4.1         Form of Indenture between Transition Auto Finance II, Inc. and Trust
            Management, Inc., as Trustee ***

4.2         Form of Secured Note Due June 30, 2002 (included in Article Two of
            Indenture filed as Exhibit 4.1)

10.1        Form of Master Contract Purchase Agreement between Transition Auto
            Finance II, Inc. and Transition Leasing Management, Inc.**

10.2        Form of Servicing Agreement between Transition Leasing Management,
            Inc. and Transition Auto Finance II, Inc. **

</TABLE>

*     Incorporated by reference from Registration Statement on Form SB-2 of
      Transition Auto Finance II, Inc. Registration No. 33-49261-D, filed April
      2, 1998.

**    Incorporated by reference from Amendment No. 1 to Registration Statement
      on Form SB-2 of Transition Auto Finance II, Inc., Registration No.
      33-49261-D, filed June 19, 1998.

***   Incorporated by reference from Amendment No. 2 to Registration Statement
      on Form SB-2 of Transition Auto Finance II, Inc., Registration No.
      33-49261-D, filed July 9, 1998.



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