**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**WASHINGTON,      D.C. 20549**

**FORM      10-Q**

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

**TRANSITION      REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT**

**FREEDOM      FINANCIAL GROUP, INC.**

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| Delaware                                                                        | 43-1647559                                            |
|---------------------------------------------------------------------------------|-------------------------------------------------------|
| (State                  or other jurisdiction of incorporation or organization) | (I.R.S.                  Employer Identification No.) |

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| Large                accelerated filer  ̈                                                                  |                                       | Accelerated                filer  ̈ |
|----------------------------------------------------------------------------------------------------------------|--------------------------------------------|-----------------------------------------|
| Non-accelerated                filer  ̈                 (Do not check if a smaller reporting company) | Smaller                reporting company x |

**APPLICABLE      ONLY TO ISSUERS INVOLVED IN BANKRUPTCY**

**PROCEEDINGS      DURING THE PRECEDING FIVE YEARS**

**APPLICABLE      ONLY TO CORPORATE ISSUERS:**

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**TABLE      OF CONTENTS**

| **PART                I. - FINANCIAL INFORMATION**    | **3**                                                                                                                         |
|-------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------|
|                                                  |                                                                                                                          |
| **ITEM                1.**                            | **Financial                Statements**                                                                                       | **3** |
|                                                  |                                                                                                                          |   |
| **ITEM                2.**                            | **Management’s                Discussion and Analysis of Financial Condition and Results of                Operations** | **15** |
|                                                  |                                                                                                                          |   |
| **ITEM                3.**                            | **Quantitative                and Qualitative Disclosures About Market Risk**                                                 | **29** |
|                                                  |                                                                                                                          |   |
| **ITEM                4.**                            | **Controls                and Procedures**                                                                                    | **29** |
|                                                  |                                                                                                                          |   |
| **ITEM                4T.**                           | **Controls                and Procedures**                                                                                    | **30** |
|                                                  |                                                                                                                          |   |
| **PART                II. – OTHER INFORMATION** | **31**                                                                                                                        |
|                                                  |                                                                                                                          |
| **ITEM                4.**                            | **Submission                of Matters to a Vote of Security Holders**                                                        | **31** |
|                                                  |                                                                                                                          |   |
| **ITEM                6.**                            | **Exhibits**                                                                                                                  | **32** |
|                                                  |                                                                                                                          |   |
| **INDEX                TO EXHIBITS**                  | **32**                                                                                                                        |

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**PART      I.**
** **
**FINANCIAL      INFORMATION**

**ITEM      1.**
**Financial      Statements**

**Report      of Independent Registered Public Accounting Firm**

**/s/      Weaver & Martin, LLC**
** **

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**FREEDOM      FINANCIAL GROUP, INC.**

**Consolidated      Balance Sheets**

|                                                                                                                                                                                                                                                                                                                                           |   | **Unaudited**              |       |                  |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------|------------|-----------------------|--------|
|                                                                                                                                                                                                                                                                                                                                           |   | **September**** 30,** |       | **December 31,** |   |
|                                                                                                                                                                                                                                                                                                                                           |   | **2008**                   |       | **2007**              |   |
| **Assets**                                                                                                                                                                                                                                                                                                                                     |   |                       |       |                  |   |   |   |
| Cash                and cash equivalents                                                                                                                                                                                                                                                                                                       |   | $                          | 1,699,731  |                  | $      | 1,857,695 |   |
| Finance                receivables, net                                                                                                                                                                                                                                                                                                        |   |                       | 14,036,115 |                  |   | 9,677,815 |   |
| Accrued                interest receivable                                                                                                                                                                                                                                                                                                     |   |                       | 147,151    |                  |   | 124,980 |   |
| Property                and equipment, net                                                                                                                                                                                                                                                                                                     |   |                       | 59,229     |                  |   | 274,426 |   |
| Deferred                financing costs                                                                                                                                                                                                                                                                                                        |   |                       | 364,723    |                  |   | 76,365 |   |
| Deferred                origination costs                                                                                                                                                                                                                                                                                                      |   |                       | 102,051    |                  |   | — |   |
| Other                assets                                                                                                                                                                                                                                                                                                                    |   |                       | 48,950     |                  |   | 17,861 |   |
|                                                                                                                                                                                                                                                                                                                                           |   |                       |       |                  |   |   |   |
| Total                assets                                                                                                                                                                                                                                                                                                                    |   | $                          | 16,457,950 |                  | $      | 12,029,142 |   |
|                                                                                                                                                                                                                                                                                                                                           |   |                       |       |                  |   |   |   |
| **Liabilities                and Stockholders’ Equity**                                                                                                                                                                                                                                                                                  |   |                       |       |                  |   |   |   |
|                                                                                                                                                                                                                                                                                                                                           |   |                       |       |                  |   |   |   |
| **Liabilities**                                                                                                                                                                                                                                                                                                                                |   |                       |       |                  |   |   |   |
| Bank                line of credit                                                                                                                                                                                                                                                                                                             |   | $                          | 6,905,708  |                  | $      | 1,503,567 |   |
| Accounts                payable                                                                                                                                                                                                                                                                                                                |   |                       | 31,889     |                  |   | 20,489 |   |
| Accrued                expenses                                                                                                                                                                                                                                                                                                                |   |                       | 59,221     |                  |   | 32,838 |   |
| Accrued                compensation costs                                                                                                                                                                                                                                                                                                      |   |                       | 30,132     |                  |   | 58,112 |   |
| Other                liabilities                                                                                                                                                                                                                                                                                                               |   |                       | 10,823     |                  |   | 51,381 |   |
|                                                                                                                                                                                                                                                                                                                                           |   |                       |       |                  |   |   |   |
| Total                liabilities                                                                                                                                                                                                                                                                                                               |   |                       | 7,037,773  |                  |   | 1,666,387 |   |
|                                                                                                                                                                                                                                                                                                                                           |   |                       |       |                  |   |   |   |
| **Stockholders’                Equity**                                                                                                                                                                                                                                                                                                  |   |                       |       |                  |   |   |   |
| Common                stock, $0.0001 par value; 36,000,000 shares authorized; 20,467,001                and                19,927,001 shares issued at September 30, 2008 and December 31, 2007                respectively; 20,462,543 and 19,922,543 shares outstanding at September                30, 2008 and December 2007, respectively |   |                       | 2,047      |                  |   | 1,993 |   |
| Additional                paid-in-capital                                                                                                                                                                                                                                                                                                      |   |                       | 13,882,348 |                  |   | 13,802,873 |   |
| Retained                earnings (deficit)                                                                                                                                                                                                                                                                                                     |   |                       | (4,367,822 | )                     |   | (5,041,509 | ) |
| Accumulated                other comprehensive income (loss)                                                                                                                                                                                                                                                                                   |   |                       | (96,003    | )                     |   | 1,599,791 |   |
| Treasury                stock, at cost; 4,458 shares                                                                                                                                                                                                                                                                                           |   |                       | (393       | )                     |   | (393 | ) |
|                                                                                                                                                                                                                                                                                                                                           |   |                       |       |                  |   |   |   |
| Total                stockholders’ equity                                                                                                                                                                                                                                                                                                |   |                       | 9,420,177  |                  |   | 10,362,755 |   |
|                                                                                                                                                                                                                                                                                                                                           |   |                       |       |                  |   |   |   |
| Total                liabilities and stockholders’ equity                                                                                                                                                                                                                                                                                |   | $                          | 16,457,950 |                  | $      | 12,029,142 |   |

*See      Notes to Consolidated Financial Statements.*

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**FREEDOM      FINANCIAL GROUP, INC.**

**Consolidated      Statements of Operations**

**Unaudited**

|                                                              |   | **Three**** Months Ended** |     | **Nine Months Ended** |   |
|-------------------------------------------------------------------|--------|--------------------------------------|----------|---------------------------------|--------|
|                                                              |   | **September**** 30,**           |     | **September 30,**          |   | **September 30,** |   | **September 30,** |   |
|                                                              |   | **2008**                             |     | **2007**                        |   | **2008** |   | **2007** |   |
| **Revenues**                                                      |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| Interest                income                                    |   | $                                    | 789,875  |                            | $      | 679,924 |   | $ | 2,062,787 |   | $ | 2,006,125 |   |
| Other                income                                       |   |                                 | 43,425   |                            |   | 50,006 |   |   | 126,920 |   |   | 148,865 |   |
|                                                              |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| Total                revenues                                     |   |                                 | 833,300  |                            |   | 729,930 |   |   | 2,189,707 |   |   | 2,154,990 |   |
|                                                              |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| **Interest                Expense**                               |   |                                 | 213,585  |                            |   | 65,604 |   |   | 490,624 |   |   | 215,799 |   |
|                                                              |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| **Revenues                After Interest Expense**                |   |                                 | 619,715  |                            |   | 664,326 |   |   | 1,699,083 |   |   | 1,939,191 |   |
|                                                              |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| **Provision                for Credit Losses**                    |   |                                 | 196,704  |                            |   | 420,623 |   |   | 337,118 |   |   | 1,161,837 |   |
|                                                              |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| **Net                Revenues After Provision for Credit Losses** |   |                                 | 423,011  |                            |   | 243,703 |   |   | 1,361,965 |   |   | 777,354 |   |
|                                                              |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| **Operating                Expenses**                             |   |                                 | 644,060  |                            |   | 646,367 |   |   | 2,068,528 |   |   | 1,866,929 |   |
|                                                              |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| **Operating                Loss**                                 |   |                                 | (221,049 | )                               |   | (402,664 | ) |   | (706,563 | ) |   | (1,089,575 | ) |
|                                                              |   |                                 |          |                            |   |  |   |   |  |   |   |  |   |
| **Gain                on Liquidation of Subsidiary**              |   |                                 | —  |                            |   | — |   |   | 1,380,250 |   |   | — |   |
|                                                              |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| **Income                (Loss) before Income Taxes**              |   |                                 | (221,049 | )                               |   | (402,664 | ) |   | 673,687 |   |   | (1,089,575 | ) |
|                                                              |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| **Provision                for Income Taxes**                     |   |                                 | —  |                            |   | — |   |   | — |   |   | — |   |
|                                                              |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| **Net                Income (Loss)**                              |   | $                                    | (221,049 | )                               | $      | (402,664 | ) | $ | 673,687 |   | $ | (1,089,575 | ) |
|                                                              |   |                                 |     |                            |   |   |   |   |   |   |   |   |   |
| **Basic                and Diluted Income (Loss) Per Share**      |   | $                                    | (0.01    | )                               | $      | (0.02 | ) | $ | 0.03 |   | $ | (0.05 | ) |

*See      Notes to Consolidated Financial Statements.*

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**FREEDOM      FINANCIAL GROUP, INC.**

**Consolidated      Statements of Stockholders’ Equity**

**Unaudited**

|                                                   |   |                      |       |        |   |           |   |              |       | **Accumulated** |   |       |   |      |       |
|--------------------------------------------------------|--------|---------------------------|------------|-------------|--------|----------------|--------|-------------------|------------|-----------------|--------|------------|--------|-----------|------------|
|                                                   |   |                      |       |        |   | **Additional** |   | **Retained**      |       | **Other**       |   |       |   |      |       |
|                                                   |   | **Common**** Stock** |       | **Paid-in** |   | **Earnings**   |   | **Comprehensive** |       | **Treasury**    |   |       |   |
|                                                   |   | **Shares**                |       | **Amount**  |   | **Capital**    |   | **(Deficit)**     |       | **Income**      |   | **Stock**  |   | **Total** |       |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |
| **Balance,                December 31, 2006**          |   |                      | 19,927,001 |        | $      | 1,993          |   | $                 | 13,802,633 |            | $      | (3,596,479 | )      | $         | 930,854    |   | $ | 0 |   | $ | 11,139,001 |   |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| Net                loss                                |   |                      | —    |        |   | —        |   |              | —    |            |   | (1,445,030 | )      |      | —    |   |   | — |   |   | (1,445,030 | ) |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| Foreign                currency translation adjustment |   |                      | —    |        |   | —        |   |              | —    |            |   | —    |   |      | 668,937    |   |   | — |   |   | 668,937 |   |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| Comprehensive                loss                      |   |                      | —    |        |   | —        |   |              | —    |            |   | —    |   |      | —    |   |   | — |   |   | (776,093 | ) |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| Purchase                of treasury stock              |   |                      | (139,458   | )           |   | —        |   |              | —    |            |   | —    |   |      | —    |   |   | (12,303 | ) |   | (12,303 | ) |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| Stock                Grant                             |   |                      | 135,000    |        |   | —        |   |              | 240        |            |   | —    |   |      | —    |   |   | 11,910 |   |   | 12,150 |   |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| **Balance,                December 31, 2007**          |   |                      | 19,922,543 |        | $      | 1,993          |   | $                 | 13,802,873 |            | $      | (5,041,509 | )      | $         | 1,599,791  |   | $ | (393 | ) | $ | 10,362,755 |   |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| Net                income                              |   |                      | —    |        |   | —        |   |              | —    |            |   | 673,687    |   |      | —    |   |   | — |   |   | 673,687 |   |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| Foreign                currency translation adjustment |   |                      | —    |        |   | —        |   |              | —    |            |   | —    |   |      | (96,003    | ) |   | — |   |   | (96,003 | ) |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| Comprehensive                income                    |   |                      | —    |        |   | —        |   |              | —    |            |   | —    |   |      | —    |   |   | — |   |   | 577,684 |   |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| Liquidation                of subsidiary               |   |                      | —    |        |   | —        |   |              | —    |            |   | —    |   |      | (1,599,791 | ) |   | — |   |   | (1,599,791 | ) |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| Stock                warrants issued                   |   |                      | —    |        |   | —        |   |              | 30,929     |            |   | —    |   |      | —    |   |   | — |   |   | 30,929 |   |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| Stock                grant                             |   |                      | 540,000    |        |   | 54             |   |              | 48,546     |            |   | —    |   |      | —    |   |   | — |   |   | 48,600 |   |
|                                                   |   |                      |       |        |   |           |   |              |       |            |   |       |   |      |       |   |   |   |   |   |   |   |
| **Balance,                September 30, 2008**         |   |                      | 20,462,543 |        | $      | 2,047          |   | $                 | 13,882,348 |            | $      | (4,367,822 | )      | $         | (96,003    | ) | $ | (393 | ) | $ | 9,420,177 |   |

*See      Notes to Consolidated Financial Statements.*

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**FREEDOM      FINANCIAL GROUP, INC.**

**Consolidated      Statements of Cash Flows**

**Unaudited**

|                                                                                                                  |   | **For**** the Nine Months Ended****September 30,** |       |
|-----------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------|------------|
|                                                                                                                  |   | **2008**                                                                    |       | **2007** |   |
| **Operating                Activities**                                                                               |   |                                                                        |       |   |   |   |   |
| Net                income (loss)                                                                                      |   | $                                                                           | 673,687    |   | $ | (1,089,575 | ) |
| Adjustments                to reconcile net income (loss) to net cash provided by operating                activities |   |                                                                        |       |   |   |   |   |
| Depreciation                                                                                                          |   |                                                                        | 34,345     |   |   | 36,935 |   |
| Provision                for credit losses                                                                            |   |                                                                        | 337,118    |   |   | 1,161,837 |   |
| Deferred                discount income                                                                               |   |                                                                        | (244,889   | ) |   | (285,191 | ) |
| Recovery                of charged-off finance receivables                                                            |   |                                                                        | 696,966    |   |   | 528,109 |   |
| Liquidation                of subsidiary                                                                              |   |                                                                        | (1,457,047 | ) |   | — |   |
| Stock                grant expense                                                                                    |   |                                                                        | 48,600     |   |   | — |   |
| Deferral                of origination costs                                                                          |   |                                                                        | (146,655   | ) |   | — |   |
| Amortization                of deferred financing fees                                                                |   |                                                                        | 194,300    |   |   | 115,207 |   |
| Amortization                of deferred origination costs                                                             |   |                                                                        | 45,260     |   |   | — |   |
| Changes                in                                                                                             |   |                                                                        |       |   |   |   |   |
| Other                assets                                                                                           |   |                                                                        | 157,628    |   |   | (26,586 | ) |
| Accounts                payable and accrued expenses                                                                  |   |                                                                        | 35,213     |   |   | (115,579 | ) |
| Change                in cumulative foreign exchange loss                                                             |   |                                                                        | (96,002    | ) |   | ― |   |
| Net                cash provided by operating activities                                                              |   |                                                                        | 278,524    |   |   | 325,157 |   |
|                                                                                                                  |   |                                                                        |       |   |   |   |   |
| **Investing                Activities**                                                                               |   |                                                                        |       |   |   |   |   |
| Purchase                of finance receivables                                                                        |   |                                                                        | (9,515,932 | ) |   | (5,819,725 | ) |
| Principal                collected on finance receivables                                                             |   |                                                                        | 4,267,962  |   |   | 4,490,121 |   |
| Payments                of dealer reserves                                                                            |   |                                                                        | (15,534    | ) |   | (9,344 | ) |
| Payments                of dealer holdbacks                                                                           |   |                                                                        | (10,320    | ) |   | (53,139 | ) |
| Purchase                of property and equipment                                                                     |   |                                                                        | (66,136    | ) |   | (1,770 | ) |
| Net                cash used in investing activities                                                                  |   |                                                                        | (5,339,960 | ) |   | (1,393,857 | ) |
|                                                                                                                  |   |                                                                        |       |   |   |   |   |
| **Financing                Activities**                                                                               |   |                                                                        |       |   |   |   |   |
| Payment                of deferred financing fees                                                                     |   |                                                                        | (472,347   | ) |   | (37,336 | ) |
| Line                of credit advances, net                                                                           |   |                                                                        | 5,422,760  |   |   | 1,180,887 |   |
| Purchase                of treasury stock                                                                             |   |                                                                        | ―    |   |   | (12,303 | ) |
| Net                cash provided by financing activities                                                              |   |                                                                        | 4,950,413  |   |   | 1,131,248 |   |
|                                                                                                                  |   |                                                                        |       |   |   |   |   |
| **Effect                of Exchange Rate Changes on Cash and Cash                Equivalents**                        |   |                                                                        | (46,940    | ) |   | 210,375 |   |
|                                                                                                                  |   |                                                                        |       |   |   |   |   |
| **Net                Increase (Decrease) in Cash and Cash Equivalents**                                               |   |                                                                        | (157,963   | ) |   | 272,923 |   |
|                                                                                                                  |   |                                                                        |       |   |   |   |   |
| **Cash                and Cash Equivalents, Beginning of Period**                                                     |   |                                                                        | 1,857,694  |   |   | 1,276,994 |   |
|                                                                                                                  |   |                                                                        |       |   |   |   |   |
| **Cash                and Cash Equivalents, End of Period**                                                           |   | $                                                                           | 1,699,731  |   | $ | 1,549,917 |   |

*See      Notes to Consolidated Financial Statements.*

----

**FREEDOM      FINANCIAL GROUP, INC.**

**Notes      to Consolidated Financial Statements**

**Unaudited**

| **Note                1:** | **General** |
|----------------------------|-------------|

| **Note                2:** | **Basis                of Presentation** |
|----------------------------|------------------------------------------|

*See      Note 10, Discontinued Foreign Operations,*

*Financial      Reporting by Entities in Reorganization Under the Bankruptcy      Code*

| **Note                3:** | **Finance                Receivables and Allowance for Credit                Losses** |
|----------------------------|---------------------------------------------------------------------------------------|

|                                       |   | **2008** |       | **2007** |   |
|--------------------------------------------|--------|----------|------------|----------|--------|
|                                       |   |     |       |     |   |
| Automobiles                                |   | $        | 14,599,668 |     | $      | 9,514,608 |   |
| Other                                      |   |     | 700,276    |     |   | 1,348,009 |   |
| Total                finance receivables   |   |     | 15,299,944 |     |   | 10,862,617 |   |
|                                       |   |     |       |     |   |   |   |
| Less                                       |   |     |       |     |   |   |   |
| Unearned                discount           |   |     | 613,970    |     |   | 373,426 |   |
| Allowance                for credit losses |   |     | 649,859    |     |   | 811,376 |   |
|                                       |   |     | 1,263,829  |     |   | 1,184,802 |   |
| Net                finance receivables     |   | $        | 14,036,115 |     | $      | 9,677,815 |   |

----

| 2008  |   | $      | 1,887,238  |   |
|-------|--------|--------|------------|--------|
| 2009  |   |   | 6,751,937  |   |
| 2010  |   |   | 5,680,069  |   |
| 2011  |   |   | 4,258,912  |   |
| 2012  |   |   | 2,122,164  |   |
| 2013  |   |   | 227,414    |   |
| Total |   | $      | 20,927,734 |   |

|                                                  |   | **Three**** Months Ended** |     | **Nine Months Ended** |   |
|-------------------------------------------------------|--------|--------------------------------------|----------|---------------------------------|--------|
|                                                  |   | **September**** 30,**           |     | **September 30,**          |   |
|                                                  |   | **2008**                             |     | **2007**                        |   | **2008** |   | **2007** |   |
|                                                  |   |                                 |     |                            |   |   |   |   |   |
| Balance,                beginning of period           |   | $                                    | 675,940  |                            | $      | 823,004 |   | $ | 811,376 |   | $ | 720,967 |   |
| Provision                charged to expense           |   |                                 | 196,704  |                            |   | 420,623 |   |   | 337,118 |   |   | 1,161,837 |   |
| Losses                charged off                     |   |                                 | (384,599 | )                               |   | (525,314 | ) |   | (1,185,637 | ) |   | (1,375,090 | ) |
| Recoveries                                            |   |                                 | 166,095  |                            |   | 170,923 |   |   | 696,966 |   |   | 364,349 |   |
| Effect                of foreign currency translation |   |                                 | (4,281   | )                               |   | 13,455 |   |   | (9,964 | ) |   | 30,628 |   |
| Balance,                end of period                 |   | $                                    | 649,859  |                            | $      | 902,691 |   | $ | 649,859 |   | $ | 902,691 |   |

| **Note                4:** | **Bank                Line of Credit** |
|----------------------------|----------------------------------------|

----

| **Note                5:** | **Income                Taxes** |
|----------------------------|---------------------------------|

| **Note                6:** | **Commitments                and Contingencies** |
|----------------------------|--------------------------------------------------|

----

| 2008       |   | $      | 12,219  |   |
|------------|--------|--------|---------|--------|
| 2009       |   |   | 48,875  |   |
| 2010       |   |   | 48,875  |   |
| 2011       |   |   | 48,875  |   |
| Thereafter |   |   | 77,387  |   |
| Total      |   | $      | 236,231 |   |

| **Note                7:** | **Earnings                Per Share** |
|----------------------------|---------------------------------------|

|                              |   | **Three months ended ****September 30,** |       | **Nine months ended ****September 30,** |   |
|----------------------------------------|--------|--------------------------------------------------------------|------------|-------------------------------------------------------------|--------|
|                                   |   | **2008**                                                     |       | **2007**                                                    |   | **2008** |   | **2007** |   |
|                                   |   |                                                         |       |                                                        |   |   |   |   |   |
| Net                income (loss)       |   | $                                                            | (221,049   | )                                                           | $      | (402,664 | ) | $ | 673,687 |   | $ | (1,089,575 | ) |
|                                   |   |                                                         |       |                                                        |   |   |   |   |   |   |   |   |   |
| Weighted                Average Shares |   |                                                         | 20,462,543 |                                                        |   | 19,836,050 |   |   | 20,241,813 |   |   | 19,896,351 |   |
|                                   |   |                                                         |       |                                                        |   |   |   |   |   |   |   |   |   |
| Per                share amount        |   | $                                                            | (0.01      | )                                                           | $      | (0.02 | ) | $ | 0.03 |   | $ | (0.05 | ) |

----

| **Note                8:** | **Operating                Expenses** |
|----------------------------|---------------------------------------|

|                                 |   | **Three**** months ended****September 30,** |    | **Nine months ended****September 30,** |   |
|-------------------------------------------|--------|------------------------------------------------------------|---------|-------------------------------------------------------|--------|
|                                      |   | **2008**                                                   |    | **2007**                                              |   | **2008** |   | **2007** |   |
|                                      |   |                                                       |    |                                                  |   |   |   |   |   |
| Salaries                and benefits      |   | $                                                          | 394,005 |                                                  | $      | 379,820 |   | $ | 1,242,949 |   | $ | 1,108,178 |   |
| Professional                fees          |   |                                                       | 45,730  |                                                  |   | 52,228 |   |   | 207,689 |   |   | 207,172 |   |
| Information                services       |   |                                                       | 109,065 |                                                  |   | 32,388 |   |   | 178,767 |   |   | 72,603 |   |
| Insurance                                 |   |                                                       | 42,073  |                                                  |   | 39,847 |   |   | 129,102 |   |   | 121,557 |   |
| Stockholder                relations      |   |                                                       | 5,305   |                                                  |   | 48,717 |   |   | 69,037 |   |   | 48,462 |   |
| Deferred                origination costs |   |                                                       | (83,164 | )                                                     |   | — |   |   | (147,380 | ) |   | — |   |
| Other                                     |   |                                                       | 131,046 |                                                  |   | 93,367 |   |   | 388,364 |   |   | 308,957 |   |
|                                      |   |                                                       |    |                                                  |   |   |   |   |   |   |   |   |   |
|                                      |   | $                                                          | 644,060 |                                                  | $      | 646,367 |   | $ | 2,068,528 |   | $ | 1,866,929 |   |

| **Note                9:** | **Stock                Based Compensation** |
|----------------------------|---------------------------------------------|

*See      Note 4, Bank Line of Credit, *
* *

----

*i.e.*

| **Note                10:** | **Discontinued                Foreign Operations** |
|-----------------------------|----------------------------------------------------|

|                                                  |   | **Three Months Ended** |    | **Nine Months Ended** |   |
|------------------------------------------------------------|--------|----------------------------------|---------|---------------------------------|--------|
|                                                       |   | **September 30,**           |    | **September 30,**          |   |
|                                                       |   | **2008**                         |    | **2007**                        |   | **2008** |   | **2007** |   |
|                                                       |   |                             |    |                            |   |   |   |   |   |
| Total                revenues                              |   | $                                | 118,400 |                            | $      | 204,184 |   | $ | 447,188 |   | $ | 636,226 |   |
| Income                (loss) before income taxes           |   | $                                | 81,140  |                            | $      | (132,654 | ) | $ | 84,440 |   | $ | (291,590 | ) |
| Net                income (loss)                           |   | $                                | 81,140  |                            | $      | (132,654 | ) | $ | 84,440 |   | $ | (291,590 | ) |
| Basic                and diluted earnings (loss) per share |   | $                                | 0.00    |                            | $      | (0.01 | ) | $ | 0.00 |   | $ | (0.01 | ) |

| **Note                11:** | **Additional                Cash Flow Information** |
|-----------------------------|-----------------------------------------------------|

----

| **Note                12:** | **Recently                Issued Accounting                Pronouncements** |
|-----------------------------|-----------------------------------------------------------------------------|

----

| **ITEM              2.** | **Management’s                Discussion and Analysis**** ****of                Financial Condition and Results of                Operations** |
|--------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

**FORWARD-LOOKING      STATEMENTS**

*This      Quarterly Report on Form 10-Q contains forward-looking statements within the      meaning of the Private Securities Litigation Reform Act of 1995. Words such      as“intend,” “anticipate,” “believe,” “estimate,” “plan,” and “expect,” and      variations of these words and similar expressions are intended to identify      these      forward-looking statements. All statements other than statements of historical      facts contained in this report, including statements regarding our future      financial position, business strategy, budgets, projected costs and plans and      objectives of management for future operations, are considered to be      forward-looking statements. We express our expectations, beliefs or projections      in good faith and believe our expectations reflected in these forward-looking      statements are based on reasonable assumptions; however, we cannot assure you      that these expectations, beliefs or projections will prove to have been correct.      Risks, uncertainties and assumptions that could cause actual results to differ      materially from the expectations reflected in the forward-looking statements      include, among other things: (i) the risks associated with business expansion;      (ii) the ability to obtain sufficient outside debt and/or equity financing      on      terms acceptable to us in order to meet our cash requirements over the coming      12      months; (iii) our ability to compete successfully against competitors with      significantly greater financial, marketing and advertising resources than the      Company; and (iv) the risk of adverse economic conditions lessening demand      for      our products.*

*Readers      are referred to the caption “Risk Factors” appearing at the end of*
***ITEM      1, Description of Business***
*      in      our annual report on Form 10-KSB, filed on March 21, 2008, for additional      factors that may affect our forward-looking statements. In light of these risks,      uncertainties and assumptions, the forward-looking events discussed in this      Form      10-Q might not occur. We undertake no obligation to update or revise our      forward-looking statements, whether as a result of new information, future      events or otherwise.*

***Overview***

***Reorganization      of Predecessor Under Chapter 11***

----

| December                31, 2003  |   |   | 17 | % |
|-----------------------------------|--------|--------|----|---|
| December                31, 2004  |   |   | 45 | % |
| December                31, 2005  |   |   | 79 | % |
| December                31, 2006  |   |   | 84 | % |
| December                31, 2007  |   |   | 87 | % |
| September                30, 2008 |   |   | 95 | % |

|  | (1) | Consistently                acquiring an increasing volume of sub-prime automobile-secured Installment                Contracts, through our point-of-sale programs, that meet the Company’s                underwriting guidelines; |
|--|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Obtaining                additional outside debt and/or equity financing to meet the Company’s                future cash requirements; |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | Minimizing                the credit losses in the Installment Contracts portfolio;                and |
|--------|-----|--------------------------------------------------------------------------------------------------------|

|   | (4) | Monitoring                key performance measures, including cost per loan acquired, book                to look                ratio (computed as the number of contracts acquired compared to the                number                of credit applications received/reviewed), turnaround time for responding                to credit applications submitted by dealers, and turnaround time                for                funding a loan package submitted by a                dealer. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

***Critical      Accounting Policies, Judgments and Estimates***

**Item      2, MANAGEMENT’S DISCUSSION AND ANALYSIS,**
***Results      of Operations***
***–      Provision for Credit Losses***
* *
***Financial      Condition***
***–      Asset Quality***
*.*

***Selected      Financial Data***

----

|                                                                                               |   | **Three Months Ended****September 30,** |      | **Nine Months Ended**** September 30,** |   |
|---------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------|-----------|-------------------------------------------------------------|--------|
|                                                                                                    |   | **2008**                                               |      | **2007**                                                    |   | **2008** |   | **2007** |   |
| Installment                Contracts acquired during the period (total principal                amount) |   | $                                                      | 4,938,542 |                                                        | $      | 1,970,256 |   | $ | 10,054,453 |   | $ | 6,190,400 |   |
| Purchase                price of Installment Contracts acquired                                         |   | $                                                      | 4,675,904 |                                                        | $      | 1,876,172 |   | $ | 9,528,203 |   | $ | 5,855,701 |   |
| Percentage                of dollar amount paid to principal balance acquired                           |   |                                                   | 94.7      | %                                                           |   | 95.2 | % |   | 94.8 | % |   | 94.6 | % |
| Number                of Installment Contracts acquired during the period                               |   |                                                   | 450       |                                                        |   | 228 |   |   | 870 |   |   | 786 |   |
| Average                principal balance acquired                                                       |   | $                                                      | 10,975    |                                                        | $      | 8,641 |   | $ | 10,539 |   | $ | 7,876 |   |
| Acquisition                cost per acquired Installment Contract (including                overhead)   |   | $                                                      | 679       |                                                        | $      | 620 |   | $ | 677 |   | $ | 645 |   |
| Monthly                servicing cost per Installment Contract (including                overhead)      |   | $                                                      | 15.74     |                                                        | $      | 18.03 |   | $ | 21.94 |   | $ | 21.02 |   |

***Results      of Operations***

**Interest      Income**

|                                    |   | **For the Three Months Ended September 30, 2008 and 2007** |       |
|----------------------------------------------|--------|---------------------------------------------------------------------------------------------------------|------------|
|                                         |   | **2008**                                                                                                |       | **2007** |   |
|                                         |   | **Average**                                                                                             |       | **Interest** |   |   |   | **Average** |   | **Interest** |   |   |   |
|                                         |   | **Balance**                                                                                             |       | **Income** |   | **Yield** |   | **Balance** |   | **Income** |   | **Yield** |   |
|                                         |   |                                                                                                    |       |   |   |   |   |   |   |   |   |   |   |
| **Installment                Contracts**     |   | $                                                                                                       | 13,138,352 |     | $ | 782,829 |     |   | 23.83% |   | $ | 10,976,506 |     | $ | 665,434 |     |   | 24.25% |   |
| **Cash                and cash equivalents** |   |                                                                                                    | 1,764,458  |   |   | 7,046 |   |   | 1.60% |   |   | 1,542,192 |   |   | 14,286 |   |   | 3.71% |   |
| **Notes                receivable**          |   |                                                                                                    | -          |   |   | - |   |   | 0.00% |   |   | 6,212 |   |   | 204 |   |   | 13.14% |   |
|                                         |   |                                                                                                    |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Total**                                    |   | $                                                                                                       | 14,902,810 |   | $ | 789,875 |   |   | 21.20% |   | $ | 12,524,910 |   | $ | 679,924 |   |   | 21.71% |   |

----

|                                    |   | **For the Nine Months Ended September 30, 2008 and 2007** |       |
|----------------------------------------------|--------|--------------------------------------------------------------------------------------------------------|------------|
|                                         |   | **2008**                                                                                               |       | **2007** |   |
|                                         |   | **Average**                                                                                            |       | **Interest** |   |   |   | **Average** |   | **Interest** |   |   |   |
|                                         |   | **Balance**                                                                                            |       | **Income** |   | **Yield** |   | **Balance** |   | **Income** |   | **Yield** |   |
|                                         |   |                                                                                                   |       |   |   |   |   |   |   |   |   |   |   |
| **Installment                Contracts**     |   | $                                                                                                      | 11,576,767 |     | $ | 2,035,513 |     |   | 23.44% |   | $ | 10,780,469 |     | $ | 1,966,438 |     |   | 24.32% |   |
| **Cash                and cash equivalents** |   |                                                                                                   | 2,026,838  |   |   | 27,272 |   |   | 1.79% |   |   | 1,491,600 |   |   | 39,093 |   |   | 3.49% |   |
| **Notes                receivable**          |   |                                                                                                   | —    |   |   | — |   |   | 0.00% |   |   | 6,212 |   |   | 594 |   |   | 12.75% |   |
|                                         |   |                                                                                                   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Total**                                    |   | $                                                                                                      | 13,603,605 |   | $ | 2,062,785 |   |   | 20.22% |   | $ | 12,278,281 |   | $ | 2,006,125 |   |   | 21.79% |   |

|                                              |   | **For the Three Months Ended September 30, 2008 Compared****to the Three                Months Ended September 30, 2007** |    |
|--------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------|
|                                                   |   | **Volume**                                                                                                                                                                  |    | **Rate** |   | **Total** |   |
| Increase                (decrease) in interest income: |   |                                                                                                                                                                        |    |   |   |   |   |
| Installment                Contracts                   |   | $                                                                                                                                                                           | 128,596 |   | $ | (11,201 | ) | $ | 117,395 |   |
| Cash                and cash equivalents               |   |                                                                                                                                                                        | 2,456   |   |   | (9,697 | ) |   | (7,241 | ) |
| Notes                receivable                        |   |                                                                                                                                                                        | (102    | ) |   | (101 | ) |   | (203 | ) |
|                                                   |   |                                                                                                                                                                        |    |   |   |   |   |   |   |   |
| Total                Interest Income                   |   | $                                                                                                                                                                           | 130,950 |   | $ | (20,999 | ) | $ | 109,951 |   |

----

|                                              |   | **For the Nine Months Ended September 30, 2008 Compared****to                the Nine Months Ended September 30, 2007** |    |
|--------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|---------|
|                                                   |   | **Volume**                                                                                                                                                      |    | **Rate** |   | **Total** |   |
| Increase                (decrease) in interest income: |   |                                                                                                                                                            |    |   |   |   |   |
| Installment                Contracts                   |   | $                                                                                                                                                               | 109,958 |   | $ | (40,881 | ) | $ | 69,077 |   |
| Cash                and cash equivalents               |   |                                                                                                                                                            | 5,748   |   |   | (17,569 | ) |   | (11,821 | ) |
| Notes                receivable                        |   |                                                                                                                                                            | (297    | ) |   | (297 | ) |   | (594 | ) |
|                                                   |   |                                                                                                                                                            |    |   |   |   |   |   |   |   |
| Total                Interest Income                   |   | $                                                                                                                                                               | 115,409 |   | $ | (58,747 | ) | $ | 56,662 |   |

**Interest      Expense**

**Provision      for Credit Losses**

**Item      2, MANAGEMENT’S DISCUSSION AND ANALYSIS, **
***Financial      Condition ***
***–      Asset Quality***

----

**Operating      Expenses**

|                                      |   | **Three                Months Ended September 30,** |    | **Nine                Months Ended September 30,** |   |
|-------------------------------------------|--------|-----------------------------------------------------|---------|----------------------------------------------------|--------|
|                                      |   | **2008**                                            |    | **2007**                                           |   | **Percent****Change** |   | **2008** |   | **2007** |   | **Percent****Change** |   |
|                                      |   |                                                |    |                                               |   |   |   |   |   |   |   |   |   |
| Salaries                and benefits      |   | $                                                   | 394,005 |                                               | $      | 379,820 |   |   | 3.73% |   | $ | 1,242,949 |   | $ | 1,108,178 |   |   | 12.16% |   |
| Professional                fees          |   |                                                | 45,730  |                                               |   | 52,228 |   |   | -12.44% |   |   | 207,689 |   |   | 207,172 |   |   | 0.25% |   |
| Information                services       |   |                                                | 109,065 |                                               |   | 32,388 |   |   | 236.75% |   |   | 178,767 |   |   | 72,603 |   |   | 146.23% |   |
| Insurance                                 |   |                                                | 42,073  |                                               |   | 39,847 |   |   | 5.59% |   |   | 129,102 |   |   | 121,557 |   |   | 6.21% |   |
| Stockholder                relations      |   |                                                | 5,305   |                                               |   | 48,717 |   |   | -89.11% |   |   | 69,037 |   |   | 48,462 |   |   | 42.46% |   |
| Deferred                origination costs |   |                                                | (83,164 | )                                                  |   | — |   |   | -100.00% |   |   | (147,380 | ) |   | — |   |   | -100.00% |   |
| Other                                     |   |                                                | 131,046 |                                               |   | 93,367 |   |   | 40.36% |   |   | 388,364 |   |   | 308,957 |   |   | 25.70% |   |
| Total                                     |   | $                                                   | 644,060 |                                               | $      | 646,367 |   |   | -0.36% |   | $ | 2,068,528 |   | $ | 1,866,929 |   |   | 10.80% |   |

----

**Gain      on Liquidation of Subsidiary**

***Financial      Condition***

**Installment      Contracts Portfolio**

----

|                                       |   | **September                30, 2008** |       | **December                31, 2007** |   |
|--------------------------------------------|--------|---------------------------------------|------------|--------------------------------------|--------|
|                                       |   | **United****States**                  |       | **Canada**                           |   | **Total** |   | **United****States** |   | **Canada** |   | **Total** |   |
| Automobiles                                |   | $                                     | 13,871,370 |                                 | $      | 728,298 |   | $ | 14,599,668 |   | $ | 8,315,799 |   | $ | 1,198,809 |   | $ | 9,514,608 |   |
| Other                                      |   |                                  | -          |                                 |   | 700,276 |   |   | 700,276 |   |   | - |   |   | 1,348,009 |   |   | 1,348,009 |   |
| Total                                      |   |                                  | 13,871,370 |                                 |   | 1,428,574 |   |   | 15,299,944 |   |   | 8,315,799 |   |   | 2,546,818 |   |   | 10,862,617 |   |
|                                       |   |                                  |       |                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Less                                       |   |                                  |       |                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unearned                discount           |   |                                  | 590,250    |                                 |   | 23,720 |   |   | 613,970 |   |   | 302,992 |   |   | 70,434 |   |   | 373,426 |   |
| Allowance                for credit losses |   |                                  | 569,796    |                                 |   | 80,063 |   |   | 649,859 |   |   | 670,222 |   |   | 141,154 |   |   | 811,376 |   |
| Net                                        |   | $                                     | 12,711,324 |                                 | $      | 1,324,791 |   | $ | 14,036,115 |   | $ | 7,342,585 |   | $ | 2,335,230 |   | $ | 9,677,815 |   |

----

**Asset      Quality**

|                                  |   | **September                30, 2008** |       |
|---------------------------------------|--------|---------------------------------------|------------|
|                                  |   | **United                States**      |       | **Canada** |   | **Total** |   |
|                                  |   | **Amount**                            |       | **Pct.** |   | **Amount** |   | **Pct.** |   | **Amount** |   | **Pct.** |   |
|                                  |   |                                  |       |   |   |   |   |   |   |   |   |   |   |
| Installment                Contracts  |   | $                                     | 13,871,370 |   |   | 100% |   | $ | 1,428,574 |   |   | 100% |   | $ | 15,299,944 |   |   | 100% |   |
|                                  |   |                                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Period                of delinquency: |   |                                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 31                - 60 days           |   |                                  | 265,144    |   |   | 1.91% |   |   | 92,231 |   |   | 6.46% |   |   | 357,375 |   |   | 2.34% |   |
| 61                - 90 days           |   |                                  | 145,132    |   |   | 1.05% |   |   | 14,925 |   |   | 1.04% |   |   | 160,057 |   |   | 1.05% |   |
| 91                – 120 days    |   |                                  | 35,539     |   |   | 0.26% |   |   | 11,782 |   |   | 0.82% |   |   | 47,321 |   |   | 0.31% |   |
| 121+                days              |   |                                  | 26,266     |   |   | 0.19% |   |   | 11,123 |   |   | 0.78% |   |   | 37,389 |   |   | 0.24% |   |
|                                  |   |                                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                 |   | $                                     | 472,081    |   |   | 3.40% |   | $ | 130,061 |   |   | 9.10% |   | $ | 602,142 |   |   | 3.94% |   |

|                                  |   | **December                31, 2007** |      |
|---------------------------------------|--------|--------------------------------------|-----------|
|                                  |   | **United                States**     |      | **Canada** |   | **Total** |   |
|                                  |   | **Amount**                           |      | **Pct.** |   | **Amount** |   | **Pct.** |   | **Amount** |   | **Pct.** |   |
|                                  |   |                                 |      |   |   |   |   |   |   |   |   |   |   |
| Installment                Contracts  |   | $                                    | 8,315,799 |   |   | 100% |   | $ | 2,546,818 |   |   | 100% |   | $ | 10,862,617 |   |   | 100% |   |
|                                  |   |                                 |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Period                of delinquency: |   |                                 |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 31                - 60 days           |   |                                 | 860,278   |   |   | 10.35% |   |   | 66,197 |   |   | 2.60% |   |   | 926,475 |   |   | 8.53% |   |
| 61                - 90 days           |   |                                 | 290,704   |   |   | 3.50% |   |   | 34,582 |   |   | 1.36% |   |   | 325,286 |   |   | 2.99% |   |
| 91                – 120 days    |   |                                 | 137,936   |   |   | 1.66% |   |   | 18,243 |   |   | 0.72% |   |   | 156,179 |   |   | 1.44% |   |
| 121+                days              |   |                                 | 122,776   |   |   | 1.48% |   |   | - |   |   | 0.00% |   |   | 122,776 |   |   | 1.13% |   |
|                                  |   |                                 |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                 |   | $                                    | 1,411,694 |   |   | 16.99% |   | $ | 119,022 |   |   | 4.68% |   | $ | 1,530,716 |   |   | 14.09% |   |

----

|                                                                                                          |   | **Three                Months Ended****September                30, 2008** |       | **Three                Months Ended****September                30, 2007** |   |
|---------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------|------------|----------------------------------------------------------------------------|--------|
|                                                                                                          |   | **United States**                                                     |       | **Canada**                                                                 |   | **Total** |   | **United****States** |   | **Canada** |   | **Total** |   |
|                                                                                                          |   |                                                                       |       |                                                                       |   |   |   |   |   |   |   |   |   |
| Installment                Contracts, net of unearned discounts, end of period                                |   | $                                                                          | 13,281,120 |                                                                       | $      | 1,404,854 |   | $ | 14,685,974 |   | $ | 8,416,243 |   | $ | 2,688,734 |   | $ | 11,104,977 |   |
|                                                                                                          |   |                                                                       |       |                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Installment                Contracts, net of unearned discounts, average during the period                (1) |   | $                                                                          | 11,510,460 |                                                                       | $      | 1,627,893 |   | $ | 13,138,353 |   | $ | 8,309,170 |   | $ | 2,667,336 |   | $ | 10,976,506 |   |
|                                                                                                          |   |                                                                       |       |                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gross                charge-offs                                                                              |   | $                                                                          | 330,190    |                                                                       | $      | 54,409 |   | $ | 384,599 |   | $ | 472,168 |   | $ | 53,146 |   | $ | 525,314 |   |
| Recoveries                                                                                                    |   |                                                                       | 162,787    |                                                                       |   | 3,308 |   |   | 166,095 |   |   | 155,195 |   |   | 15,728 |   |   | 170,923 |   |
|                                                                                                          |   |                                                                       |       |                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                charge-offs                                                                                |   | $                                                                          | 167,403    |                                                                       | $      | 51,101 |   | $ | 218,504 |   | $ | 316,973 |   | $ | 37,418 |   | $ | 354,391 |   |
|                                                                                                          |   |                                                                       |       |                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                charge-offs as a % of avg. contracts during the period,                annualized          |   |                                                                       | 5.82%      |                                                                       |   | 12.56% |   |   | 6.65% |   |   | 15.26% |   |   | 5.61% |   |   | 12.91% |   |

|                                                                                                          |   | **Nine                Months Ended****September                30, 2008** |       | **Nine                Months Ended****September                30, 2007** |   |
|---------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------|------------|---------------------------------------------------------------------------|--------|
|                                                                                                          |   | **United States**                                                    |       | **Canada**                                                                |   | **Total** |   | **United****States** |   | **Canada** |   | **Total** |   |
|                                                                                                          |   |                                                                      |       |                                                                      |   |   |   |   |   |   |   |   |   |
| Installment                Contracts, net of unearned discounts, end of period                                |   | $                                                                         | 13,281,120 |                                                                      | $      | 1,404,854 |   | $ | 14,685,974 |   | $ | 8,416,243 |   | $ | 2,688,734 |   | $ | 11,104,977 |   |
|                                                                                                          |   |                                                                      |       |                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Installment                Contracts, net of unearned discounts, average during the period                (1) |   | $                                                                         | 9,569,122  |                                                                      | $      | 2,007,645 |   | $ | 11,576,767 |   | $ | 8,002,691 |   | $ | 2,777,779 |   | $ | 10,780,470 |   |
|                                                                                                          |   |                                                                      |       |                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gross                charge-offs                                                                              |   | $                                                                         | 1,053,030  |                                                                      | $      | 132,607 |   | $ | 1,185,637 |   | $ | 1,172,726 |   | $ | 202,364 |   | $ | 1,375,090 |   |
| Recoveries                                                                                                    |   |                                                                      | 663,341    |                                                                      |   | 33,625 |   |   | 696,966 |   |   | 298,296 |   |   | 66,053 |   |   | 364,349 |   |
|                                                                                                          |   |                                                                      |       |                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                charge-offs                                                                                |   | $                                                                         | 389,689    |                                                                      | $      | 98,982 |   | $ | 488,671 |   | $ | 874,430 |   | $ | 136,311 |   | $ | 1,010,741 |   |
|                                                                                                          |   |                                                                      |       |                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                charge-offs as a % of avg. contracts during the period,                annualized          |   |                                                                      | 5.43%      |                                                                      |   | 6.57% |   |   | 5.63% |   |   | 14.57% |   |   | 6.54% |   |   | 12.50% |   |

----

**Item      2, MANAGEMENT’S DISCUSSION AND ANALYSIS**
***Critical      Accounting Policies, Judgments and Estimates***
**MANAGEMENT’S      DISCUSSION AND ANALYSIS, **
***Results      of Operations***
***–      Provision for Credit Losses.***

----

**Item      2, MANAGEMENT’S DISCUSSION AND ANALYSIS**
***Critical      Accounting Policies and Judgments***

|                                                  |   | **Three                Months Ended****September                30, 2008** |     | **Three                Months Ended****September                30, 2007** |   |
|-------------------------------------------------------|--------|----------------------------------------------------------------------------|----------|----------------------------------------------------------------------------|--------|
|                                                  |   | **United****States**                                                       |     | **Canada**                                                                 |   | **Total** |   | **United****States** |   | **Canada** |   | **Total** |   |
|                                                  |   |                                                                       |     |                                                                       |   |   |   |   |   |   |   |   |   |
| Balance                at beginning of period         |   | $                                                                          | 569,794  |                                                                       | $      | 106,146 |   | $ | 675,940 |   | $ | 665,837 |   | $ | 157,167 |   | $ | 823,004 |   |
|                                                  |   |                                                                       |     |                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Charge-offs                                           |   |                                                                       | (330,190 | )                                                                          |   | (54,409 | ) |   | (384,599 | ) |   | (472,168 | ) |   | (53,146 | ) |   | (525,314 | ) |
| Recoveries                                            |   |                                                                       | 162,787  |                                                                       |   | 3,308 |   |   | 166,095 |   |   | 155,195 |   |   | 15,728 |   |   | 170,923 |   |
|                                                  |   |                                                                       |          |                                                                       |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Net                charge-offs                        |   |                                                                       | (167,403 | )                                                                          |   | (51,101 | ) |   | (218,504 | ) |   | (316,973 | ) |   | (37,418 | ) |   | (354,391 | ) |
|                                                  |   |                                                                       |     |                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Provision                for credit losses            |   |                                                                       | 167,403  |                                                                       |   | 29,301 |   |   | 196,704 |   |   | 400,569 |   |   | 20,054 |   |   | 420,623 |   |
|                                                  |   |                                                                       |     |                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Effect                of foreign currency translation |   |                                                                       | -        |                                                                       |   | (4,281 | ) |   | (4,281 | ) |   | - |   |   | 13,455 |   |   | 13,455 |   |
|                                                  |   |                                                                       |     |                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at end of period               |   | $                                                                          | 569,794  |                                                                       | $      | 80,065 |   | $ | 649,859 |   | $ | 749,433 |   | $ | 153,258 |   | $ | 902,691 |   |

|                                                  |   | **Nine                Months Ended****September                30, 2008** |       | **Nine                Months Ended****September                30, 2007** |   |
|-------------------------------------------------------|--------|---------------------------------------------------------------------------|------------|---------------------------------------------------------------------------|--------|
|                                                  |   | **United****States**                                                      |       | **Canada**                                                                |   | **Total** |   | **United****States** |   | **Canada** |   | **Total** |   |
|                                                  |   |                                                                      |       |                                                                      |   |   |   |   |   |   |   |   |   |
| Balance                at beginning of period         |   | $                                                                         | 670,222    |                                                                      | $      | 141,154 |   | $ | 811,376 |   | $ | 551,192 |   | $ | 169,775 |   | $ | 720,967 |   |
|                                                  |   |                                                                      |       |                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Charge-offs                                           |   |                                                                      | (1,053,030 | )                                                                         |   | (132,607 | ) |   | (1,185,637 | ) |   | (1,172,726 | ) |   | (202,364 | ) |   | (1,375,090 | ) |
| Recoveries                                            |   |                                                                      | 663,341    |                                                                      |   | 33,625 |   |   | 696,966 |   |   | 298,296 |   |   | 66,053 |   |   | 364,349 |   |
|                                                  |   |                                                                      |            |                                                                      |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Net                charge-offs                        |   |                                                                      | (389,689   | )                                                                         |   | (98,982 | ) |   | (488,671 | ) |   | (874,430 | ) |   | (136,311 | ) |   | (1,010,741 | ) |
|                                                  |   |                                                                      |       |                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Provision                for credit losses            |   |                                                                      | 289,261    |                                                                      |   | 47,857 |   |   | 337,118 |   |   | 1,072,671 |   |   | 89,166 |   |   | 1,161,837 |   |
|                                                  |   |                                                                      |       |                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Effect                of foreign currency translation |   |                                                                      | -          |                                                                      |   | (9,964 | ) |   | (9,964 | ) |   | - |   |   | 30,628 |   |   | 30,628 |   |
|                                                  |   |                                                                      |       |                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at end of period               |   | $                                                                         | 569,794    |                                                                      | $      | 80,065 |   | $ | 649,859 |   | $ | 749,433 |   | $ | 153,258 |   | $ | 902,691 |   |

----

***Liquidity      and Capital Resources***

----

***Off-Balance      Sheet Arrangements***

| 2008       |   | $      | 12,219  |   |
|------------|--------|--------|---------|--------|
| 2009       |   |   | 48,875  |   |
| 2010       |   |   | 48,875  |   |
| 2011       |   |   | 48,875  |   |
| Thereafter |   |   | 77,387  |   |
| Total      |   | $      | 236,231 |   |

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

**ITEM      4.**
**Controls      and Procedures**
** **

----

**ITEM      4T.**
**Controls      and Procedures**

----

**PART      II. **
**-      OTHER INFORMATION**

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

| Stephen                J. Gore      | For                — 12,922,192 | Withheld                — 1,820,636 |
|-------------------------------------|---------------------------------------|-------------------------------------------|
| Vernon                S. Schweigert | For                — 12,625,213 | Withheld                — 2,117,615 |

----

**ITEM      6.**
**Exhibits**

**INDEX      TO EXHIBITS**

|        |   |                                                                                                                                                                                                                                        |
|-------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **Exhibit** |   |                                                                                                                                                                                                                                        |
| **Number**  |   | **Description**                                                                                                                                                                                                                             |
|        |   |                                                                                                                                                                                                                                        |
| 2.1         |   | Corrected                Trustee’s Amended Plan of Reorganization (1)                                                                                                                                                                 |
| 2.2         |   | Disclosure                Statement for Trustee’s Amended Plan of Reorganization                (1)                                                                                                                                   |
| 3.1         |   | First                Amended and Restated Certificate of Incorporation (1)                                                                                                                                                                  |
| 3.1.1       |   | Certificate                of Amendment to Certificate of Incorporation (1)                                                                                                                                                                 |
| 3.1.2       |   | Certificate                of Amendment to Certificate of Incorporation                                                                                                                                                                     |
| 3.2         |   | Bylaws                (1)                                                                                                                                                                                                                   |
| 3.2.1       |   | Amendment                to Bylaws (1)                                                                                                                                                                                                      |
| 3.2.2       |   | Amendment                to Bylaws                                                                                                                                                                                                          |
| 4.1         |   | Amended                and Restated Trust Agreement of Freedom Financial Group I Statutory                Trust                (1)                                                                                                          |
|        |   |                                                                                                                                                                                                                                        |
| 31.1        |   | Certification                of Principal Executive Officer Pursuant to Exchange Act Rule 13a-14(a),                as                adopted pursuant to Section 302 of the Sarbanes-Oxley Act of                2002.                     |
| 31.2        |   | Certification                of Principal Financial Officer Pursuant to Exchange Act Rule 13a-14(a),                as                adopted pursuant to Section 302 of the Sarbanes-Oxley Act of                2002.                     |
| 32.1        |   | Certifications                of Principal Executive Officer and Principal Financial Officer Pursuant                to                18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley                Act of 2002. |

----

**SIGNATURES**

|  **FREEDOM                FINANCIAL GROUP, INC.** |
|--------------------------------------------------------|
|                                                   |   |   |
| Date:                November 6, 2008                  | By: | /s/                Jerald L. Fenstermaker |
|                                                   | Jerald              L. Fenstermaker |
|                                                   | President              and Chief Executive Officer |
|                                                   | (Principal              Executive Officer) |
|                                                   |   |   |
| Date:                November 6, 2008                  | By: | /s/                J. Kevin Maxwell |
|                                                   | J.              Kevin Maxwell |
|                                                   | Treasurer              and Chief Financial Officer |
|                                                   | (Principal              Financial Officer) |

----