**UNITED        STATES**

**SECURITIES        AND EXCHANGE COMMISSION**

**WASHINGTON,        D.C. 20549**

**FORM        10-QSB**

**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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**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.**                      |  **Controls                  and Procedures**                                                                                      |  31 |
|                                                    |                                                                                                                                    |   |
|  **PART                  II. - OTHER INFORMATION** |  32                                                                                                                                |
|  **ITEM                  1.**                      |  **Legal                  Proceedings**                                                                                            |  32 |
|  **ITEM                  2.**                      |  **Unregistered                  Sales of Equity Securities and Use of Proceeds**                                                  |  32 |
|  **ITEM                  3.**                      |  **Defaults                  Upon Senior Securities**                                                                              |  32 |
|  **ITEM                  4.**                      |  **Submission                  of Matters to a Vote of Security Holders**                                                          |  32 |
|  **ITEM                  5.**                      |  **Other                  Information**                                                                                            |  32 |
|  **ITEM                  6.**                      |  **Exhibits                  and Reports on Form 8-K**                                                                             |  33 |
|  **INDEX                  TO EXHIBITS**            |  33                                                                                                                                |
|                                                    |                                                                                                                                    |   |

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

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

**Report        of Independent Registered Public Accounting Firm**

**/s/        BKD,**
**        LLP **

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**FREEDOM        FINANCIAL GROUP, INC.**

**Consolidated        Balance Sheets**

|                                         |   | **Unaudited**                      |       |                              |   |
|----------------------------------------------|--------|------------------------------------|------------|-----------------------------------|--------|
|                                         |   | **September                  30,** |       | **December                  31,** |   |
|                                         |   | **2005**                           |       | **2004**                          |   |
| **Assets**                                   |   |                               |       |                              |   |
|                                         |   |                               |       |                              |   |
| Cash                  and cash equivalents   |   | $                                  | 2,943,551  |                              | $      | 8,779,211 |   |
| Finance                  receivables, net    |   |                               | 9,107,947  |                              |   | 4,090,708 |   |
| Notes                  receivable, net       |   |                               | 16,618     |                              |   | 77,398 |   |
| Property                  and equipment, net |   |                               | 276,962    |                              |   | 294,305 |   |
| Other                  assets                |   |                               | 269,027    |                              |   | 69,303 |   |
|                                         |   |                               |       |                              |   |   |   |
| Total                  assets                |   | $                                  | 12,614,105 |                              | $      | 13,310,925 |   |

**Liabilities        and Stockholders’ Equity**

| **Liabilities**                                 |   |   |    |   |   |
|-------------------------------------------------|--------|--------|---------|--------|--------|
| Accounts                    payable             |   | $      | 16,315  |   | $      | 218,954 |   |
| Accrued                    expenses             |   |   | 38,762  |   |   | 18,091 |   |
| Accrued                    compensation costs   |   |   | 21,901  |   |   | 62,507 |   |
| Dealer                    holdbacks             |   |   | 106,205 |   |   | 90,578 |   |
| Dealer                    reserves              |   |   | 39,848  |   |   | 44,119 |   |
| Reorganization                    costs payable |   |   | — |   |   | 5,000 |   |
|                                            |   |   |    |   |   |   |   |
| Total                    liabilities            |   |   | 223,031 |   |   | 439,249 |   |
|                                            |   |   |    |   |   |   |   |

| **Stockholders’                    Equity**                                                                                                    |   |   |       |   |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|------------|--------|--------|
| Redeemable                    convertible preferred stock, $0.0001 par value; 8,994,357 shares                    authorized, issued and outstanding |   |   | 13,798,817 |   |   | 13,798,817 |   |
| Common                    stock, $0.0001 par value; 36,000,000 shares authorized; 9,965,759                    shares issued and outstanding         |   |   | 997        |   |   | 997 |   |
| Retained                    earnings (deficit)                                                                                                       |   |   | (2,355,722 | )      |   | (1,731,382 | ) |
| Accumulated                    other comprehensive income                                                                                            |   |   | 946,982    |   |   | 803,244 |   |
|                                                                                                                                                 |   |   |       |   |   |   |   |
| Total                    stockholders’ equity                                                                                                  |   |   | 12,391,074 |   |   | 12,871,676 |   |
|                                                                                                                                                 |   |   |       |   |   |   |   |
| Total                    liabilities and stockholders’ equity                                                                                  |   | $      | 12,614,105 |   | $      | 13,310,925 |   |

*See        Notes to Condensed 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,** |   |
|                                                                |   | **2005**                                |     | **2004**                               |   | **2005** |   | **2004** |   |
| **Revenues**                                                        |   |                                    |     |                                   |   |   |   |   |   |
| Interest                  income                                    |   | $                                       | 613,821  |                                   | $      | 307,115 |   | $ | 1,604,761 |   | $ | 739,629 |   |
| Recovery                  of charged-off finance receivables        |   |                                    | 22,620   |                                   |   | 32,383 |   |   | 100,650 |   |   | 129,811 |   |
| Other                  income                                       |   |                                    | 21,668   |                                   |   | 25,806 |   |   | 72,571 |   |   | 71,313 |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
| Total                  revenues                                     |   |                                    | 658,109  |                                   |   | 365,304 |   |   | 1,777,982 |   |   | 940,753 |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
| **Provision                  for Credit Losses**                    |   |                                    | 233,559  |                                   |   | 74,032 |   |   | 431,847 |   |   | 162,573 |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
| **Net                  Revenues After Provision for Credit Losses** |   |                                    | 424,550  |                                   |   | 291,272 |   |   | 1,346,135 |   |   | 778,180 |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
| **Operating                  Expenses**                             |   |                                    | 586,618  |                                   |   | 502,707 |   |   | 1,973,210 |   |   | 1,450,626 |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
| **Operating                  Loss**                                 |   |                                    | (162,068 | )                                      |   | (211,435 | ) |   | (627,075 | ) |   | (672,446 | ) |
|                                                                |   |                                    |          |                                   |   |  |   |   |  |   |   |   |   |
| **Nonoperating                  Income**                            |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
| Gain                  on settlement of pending claim                |   |                                    | —  |                                   |   | 955,973 |   |   | — |   |   | 955,973 |   |
| Other                                                               |   |                                    | 1,586    |                                   |   | — |   |   | 2,735 |   |   | — |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
| **Income                  (Loss) Before Income Taxes**              |   |                                    | (160,482 | )                                      |   | 744,538 |   |   | (624,340 | ) |   | 283,527 |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
| **Provision                  for Income Taxes**                     |   |                                    | —  |                                   |   | — |   |   | — |   |   | — |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
| **Net                  Income (Loss)**                              |   | $                                       | (160,482 | )                                      | $      | 744,538 |   | $ | (624,340 | ) | $ | 283,527 |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
| **Basic                  Income (Loss) Per Share**                  |   | $                                       | (0.02    | )                                      | $      | 0.07 |   | $ | (0.06 | ) | $ | 0.03 |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
|                                                                |   |                                    |     |                                   |   |   |   |   |   |   |   |   |   |
| **Diluted                  Income (Loss) Per Share**                |   | $                                       | (0.02    | )                                      | $      | 0.04 |   | $ | (0.06 | ) | $ | 0.01 |   |

*See        Notes to Condensed Consolidated Financial Statements.*

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**FREEDOM        FINANCIAL GROUP, INC.**

**Consolidated        Statements of Stockholders’ Equity**

**Unaudited**

|                                                                      |   | **Redeemable**  |       |                              |   |         |   |              |    | **Accumulated** |   |       |   |
|---------------------------------------------------------------------------|--------|-----------------|------------|-----------------------------------|--------|--------------|--------|-------------------|---------|-----------------|--------|------------|--------|
|                                                                      |   | **Convertible** |       |                              |   |         |   |              |    | **Other**       |   |       |   |
|                                                                      |   | **Preferred**   |       | **Common                  Stock** |   | **Retained** |   | **Comprehensive** |    |            |   |
|                                                                      |   | **Stock**       |       | **Shares**                        |   | **Amount**   |   | **Earnings**      |    | **Income**      |   | **Total**  |   |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |
| **Balance,                  December 31, 2004**                           |   | $               | 13,798,817 |                              |   | 9,965,759    |   | $                 | 997     |            | $      | (1,731,382 | )      | $ | 803,244 |   | $ | 12,871,676 |   |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
| Net                  loss                                                 |   |            | —    |                              |   | —      |   |              | — |            |   | (624,340   | )      |   | — |   |   | (624,340 | ) |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
| Foreign                  currency translation                  adjustment |   |            | —    |                              |   | —      |   |              | — |            |   | —    |   |   | 143,738 |   |   | 143,738 |   |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
| Comprehensive                  loss                                       |   |            | —    |                              |   | —      |   |              | — |            |   | —    |   |   | — |   |   | (480,602 | ) |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
| **Balance,                  September 30, 2005**                          |   | $               | 13,798,817 |                              |   | 9,965,759    |   | $                 | 997     |            | $      | (2,355,722 | )      | $ | 946,982 |   | $ | 12,391,074 |   |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
| **Balance,                  December 31, 2003**                           |   | $               | 13,798,817 |                              |   | 9,965,759    |   | $                 | 997     |            | $      | (1,747,658 | )      | $ | 550,436 |   | $ | 12,602,592 |   |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
| Net                  income                                               |   |            | —    |                              |   | —      |   |              | — |            |   | 283,527    |   |   | — |   |   | 283,527 |   |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
| Foreign                  currency translation adjustment                  |   |            | —    |                              |   | —      |   |              | — |            |   | —    |   |   | 78,788 |   |   | 78,788 |   |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
| Comprehensive                  income                                     |   |            | —    |                              |   | —      |   |              | — |            |   | —    |   |   | — |   |   | 362,315 |   |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
| Cancellation                  of stock issued in error                    |   |            | —    |                              |   | (1,726       | )      |              | — |            |   | —    |   |   | — |   |   | — |   |
|                                                                      |   |            |       |                              |   |         |   |              |    |            |   |       |   |   |   |   |   |   |   |
| **Balance,                  September 30, 2004**                          |   | $               | 13,798,817 |                              |   | 9,965,759    |   | $                 | 997     |            | $      | (1,464,131 | )      | $ | 629,224 |   | $ | 12,964,907 |   |

*See        Notes to Condensed Consolidated Financial Statements.*

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**FREEDOM        FINANCIAL GROUP, INC.**

**Consolidated        Statements of Cash Flows**

**Unaudited**

|                                                                                                                  |   | **For                  the Nine Months Ended****September                  30,** |       |
|-----------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------|------------|
|                                                                                                                  |   | **2005**                                                                         |       | **2004** |   |
| **Operating                  Activities**                                                                             |   |                                                                             |       |   |   |
| Net                  income (loss)                                                                                    |   | $                                                                                | (624,340   | ) | $ | 283,527 |   |
| Adjustments                  to reconcile net income (loss) to net cash used in operating                  activities |   |                                                                             |       |   |   |   |   |
| Depreciation                                                                                                          |   |                                                                             | 43,326     |   |   | 42,710 |   |
| Provision                  for credit losses                                                                          |   |                                                                             | 431,847    |   |   | 162,573 |   |
| Deferred                  discount income                                                                             |   |                                                                             | (491,606   | ) |   | (300,352 | ) |
| Recovery                  of charged-off finance receivables                                                          |   |                                                                             | 162,183    |   |   | 108,812 |   |
| Gain                  on settlement of pending claims                                                                 |   |                                                                             | —    |   |   | (955,973 | ) |
| Changes                  in                                                                                           |   |                                                                             |       |   |   |   |   |
| Other                  assets                                                                                         |   |                                                                             | (58,957    | ) |   | (26,141 | ) |
| Accounts                  payable and accrued expenses                                                                |   |                                                                             | (223,300   | ) |   | (43,911 | ) |
| Reorganization                  costs payable                                                                         |   |                                                                             | (5,000     | ) |   | (15,000 | ) |
| Net                  cash used in operating activities                                                                |   |                                                                             | (765,847   | ) |   | (743,755 | ) |
|                                                                                                                  |   |                                                                             |       |   |   |   |   |
| **Investing                  Activities**                                                                             |   |                                                                             |       |   |   |   |   |
| Purchase                  of finance receivables                                                                      |   |                                                                             | (8,933,881 | ) |   | (3,478,349 | ) |
| Principal                  collected on finance receivables                                                           |   |                                                                             | 3,953,024  |   |   | 2,350,550 |   |
| Payments                  of dealer reserves                                                                          |   |                                                                             | (14,692    | ) |   | (12,589 | ) |
| Payments                  of dealer holdbacks                                                                         |   |                                                                             | (134,069   | ) |   | (114,585 | ) |
| Principal                  collected on notes receivable                                                              |   |                                                                             | 60,780     |   |   | 32,247 |   |
| Purchase                  of property and equipment                                                                   |   |                                                                             | (18,184    | ) |   | (41,016 | ) |
| Proceeds                  from sale of property and equipment                                                         |   |                                                                             | 2,000      |   |   | — |   |
| Net                  cash used in investing activities                                                                |   |                                                                             | (5,085,022 | ) |   | (1,263,742 | ) |
|                                                                                                                  |   |                                                                             |       |   |   |   |   |
| **Financing                  Activities**                                                                             |   |                                                                             |       |   |   |   |   |
| Settlement                  proceeds from previously pending claims                                                   |   |                                                                             | —    |   |   | 6,955,973 |   |
| Payment                  of deferred financing fees                                                                   |   |                                                                             | —    |   |   | (25,000 | ) |
| Net                  cash provided by financing activities                                                            |   |                                                                             | —    |   |   | 6,930,973 |   |
|                                                                                                                  |   |                                                                             |       |   |   |   |   |
|                                                                                                                  |   |                                                                             |       |   |   |   |   |
| **Effect                  of Exchange Rate Changes on Cash and Cash                  Equivalents**                    |   |                                                                             | 15,209     |   |   | 14,919 |   |
|                                                                                                                  |   |                                                                             |       |   |   |   |   |
| **Net                  Increase (Decrease) in Cash and Cash Equivalents**                                             |   |                                                                             | (5,835,660 | ) |   | 4,938,395 |   |
|                                                                                                                  |   |                                                                             |       |   |   |   |   |
| **Cash                  and Cash Equivalents, Beginning of Period**                                                   |   |                                                                             | 8,779,211  |   |   | 4,280,766 |   |
|                                                                                                                  |   |                                                                             |       |   |   |   |   |
| **Cash                  and Cash Equivalents, End of Period**                                                         |   | $                                                                                | 2,943,551  |   | $ | 9,219,161 |   |

*See        Notes to Condensed Consolidated Financial Statements.*

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**FREEDOM        FINANCIAL GROUP, INC.**

**Notes        to Condensed Consolidated Financial Statements**

**Unaudited**

**Note        1:  **
**General**

**Note        2:  **
**Basis        of Presentation**

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

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

|                                         |   | **2005** |       | **2004** |   |
|----------------------------------------------|--------|----------|------------|----------|--------|
|                                         |   |     |       |     |   |
| Automobiles                                  |   | $        | 7,764,086  |     | $      | 2,183,510 |   |
| Equipment                  leases            |   |     | 816,096    |     |   | 999,724 |   |
| Bulk                  food                   |   |     | 811,964    |     |   | 962,070 |   |
| Home                  appliances             |   |     | 265,966    |     |   | 274,800 |   |
| Other                                        |   |     | 471,068    |     |   | 485,736 |   |
| Total                  finance receivables   |   |     | 10,129,180 |     |   | 4,905,840 |   |
|                                         |   |     |       |     |   |   |   |
| Less                                         |   |     |       |     |   |   |   |
| Unearned                  discount           |   |     | 630,890    |     |   | 518,899 |   |
| Allowance                  for credit losses |   |     | 390,343    |     |   | 296,233 |   |
|                                         |   |     | 1,021,233  |     |   | 815,132 |   |
| Net                  finance receivables     |   | $        | 9,107,947  |     | $      | 4,090,708 |   |

| 2005  |   | $      | 1,717,123  |   |
|-------|--------|--------|------------|--------|
| 2006  |   |   | 5,145,012  |   |
| 2007  |   |   | 3,500,359  |   |
| 2008  |   |   | 2,266,141  |   |
| 2009  |   |   | 644,196    |   |
| 2010  |   |   | 12,889     |   |
| Total |   | $      | 13,285,720 |   |

|                                                          |   | **2005** |     | **2004** |   |
|---------------------------------------------------------------|--------|----------|----------|----------|--------|
|                                                          |   |     |     |     |   |
| Balance,                  beginning of period                 |   | $        | 317,934  |     | $      | 282,232 |   |
| Provision                  charged to expense                 |   |     | 233,559  |     |   | 74,032 |   |
| Losses                  charged off                           |   |     | (332,569 | )        |   | (65,244 | ) |
| Recoveries                  of previously charged off amounts |   |     | 158,851  |     |   | 30,603 |   |
| Effect                  of foreign currency translation       |   |     | 12,568   |     |   | 8,118 |   |
| Balance,                  end of period                       |   | $        | 390,343  |     | $      | 329,741 |   |
|                                                          |   |     |     |     |   |   |   |

----

|                                                          |   | **2005** |     | **2004** |   |
|---------------------------------------------------------------|--------|----------|----------|----------|--------|
|                                                          |   |     |     |     |   |
| Balance,                  beginning of period                 |   | $        | 296,233  |     | $      | 196,698 |   |
| Provision                  charged to expense                 |   |     | 431,847  |     |   | 162,573 |   |
| Losses                  charged off                           |   |     | (652,492 | )        |   | (142,696 | ) |
| Recoveries                  of previously charged off amounts |   |     | 304,384  |     |   | 110,557 |   |
| Effect                  of foreign currency translation       |   |     | 10,371   |     |   | 2,609 |   |
| Balance,                  end of period                       |   | $        | 390,343  |     | $      | 329,741 |   |
|                                                          |   |     |     |     |   |   |   |

**Note        4:  **
**Commitments**

**Note        5:  **
**Income        (Loss) Per Share**

----

|                                                |   |     |     | **Weighted** |   |                             |   |
|-----------------------------------------------------|--------|----------|----------|--------------|--------|----------------------------------|--------|
|                                                |   |     |     | **Average**  |   | **Per                    Share** |   |
|                                                |   | **Loss** |     | **Shares**   |   | **Amount**                       |   |
|                                                |   |     |     |         |   |                             |   |
| Net                    loss                         |   | $        | (160,482 | )            |   | 9,965,759                        |   |   |   |   |
| Basic                    and diluted loss per share |   |     |     |         |   |                             |   | $ | (0.02 | ) |

|                                                                            |   |       |    | **Weighted** |   |                             |   |
|---------------------------------------------------------------------------------|--------|------------|---------|--------------|--------|----------------------------------|--------|
|                                                                            |   |       |    | **Average**  |   | **Per                    Share** |   |
|                                                                            |   | **Income** |    | **Shares**   |   | **Amount**                       |   |
|                                                                            |   |       |    |         |   |                             |   |
| Net                    income                                                   |   | $          | 744,538 |         |   | 9,965,759                        |   |   |   |   |
| Basic                    earnings per share                                     |   |       |    |         |   |                             |   | $ | 0.07 |   |
|                                                                            |   |       |    |         |   |                             |   |   |   |   |
| Effect                    of presumed conversion of convertible preferred stock |   |       | — |         |   | 8,994,357                        |   |   |   |   |
|                                                                            |   |       |    |         |   |                             |   |   |   |   |
| Diluted                    earnings per share                                   |   | $          | 744,538 |         |   | 18,960,116                       |   | $ | 0.04 |   |

|                                              |   | **Loss** |     | **Weighted****Average****Shares** |   | **Per                  Share****Amount** |   |
|---------------------------------------------------|--------|----------|----------|-----------------------------------|--------|------------------------------------------|--------|
|                                              |   |     |     |                              |   |                                     |   |
| Net                  loss                         |   | $        | (624,340 | )                                 |   | 9,965,759                                |   |   |   |   |
| Basic                  and diluted loss per share |   |     |     |                              |   |                                     |   | $ | (0.06 | ) |

|                                                                          |   |       |    | **Weighted** |   |                           |   |
|-------------------------------------------------------------------------------|--------|------------|---------|--------------|--------|--------------------------------|--------|
|                                                                          |   |       |    | **Average**  |   | **Per                  Share** |   |
|                                                                          |   | **Income** |    | **Shares**   |   | **Amount**                     |   |
|                                                                          |   |       |    |         |   |                           |   |
| Net                  income                                                   |   | $          | 283,527 |         |   | 9,966,332                      |   |   |   |   |
| Basic                  earnings per share                                     |   |       |    |         |   |                           |   | $ | 0.03 |   |
|                                                                          |   |       |    |         |   |                           |   |   |   |   |
| Effect                  of presumed conversion of convertible preferred stock |   |       | — |         |   | 8,994,357                      |   |   |   |   |
|                                                                          |   |       |    |         |   |                           |   |   |   |   |
| Diluted                  earnings per share                                   |   | $          | 283,527 |         |   | 18,960,689                     |   | $ | 0.01 |   |

----

**Note        6:  **
**Operating        Expenses**

|                                             |   | **2005** |    | **2004** |   |
|--------------------------------------------------|--------|----------|---------|----------|--------|
|                                             |   |     |    |     |   |
| Salaries                  and benefits           |   | $        | 351,014 |     | $      | 272,730 |   |
| Professional                  fees               |   |     | 91,887  |     |   | 40,428 |   |
| Bankruptcy                  reorganization costs |   |     | — |     |   | 71,941 |   |
| Other                                            |   |     | 143,717 |     |   | 117,608 |   |
|                                             |   |     |    |     |   |   |   |
|                                             |   | $        | 586,618 |     | $      | 502,707 |   |

|                                               |   | **2005** |      | **2004** |   |
|----------------------------------------------------|--------|----------|-----------|----------|--------|
|                                               |   |     |      |     |   |
| Salaries                  and benefits             |   | $        | 1,137,288 |     | $      | 814,595 |   |
| Professional                  fees                 |   |     | 380,355   |     |   | 155,194 |   |
| Pending                  claims related legal fees |   |     | —   |     |   | 57,328 |   |
| Bankruptcy                  reorganization costs   |   |     | —   |     |   | 90,818 |   |
| Other                                              |   |     | 455,567   |     |   | 332,691 |   |
|                                               |   |     |      |     |   |   |   |
|                                               |   | $        | 1,973,210 |     | $      | 1,450,626 |   |

----

**Note        7:  **
**Foreign        Operations**

|                                               |   | **2005** |    | **2004** |   |
|----------------------------------------------------|--------|----------|---------|----------|--------|
|                                               |   |     |    |     |   |
| Total                  revenues                    |   | $        | 258,613 |     | $      | 214,342 |   |
|                                               |   |     |    |     |   |   |   |
| Income                  (loss) before income taxes |   |     | (47,103 | )        |   | 21,064 |   |
|                                               |   |     |    |     |   |   |   |
| Net                  income (loss)                 |   |     | (47,103 | )        |   | 21,064 |   |

|                                               |   | **2005** |    | **2004** |   |
|----------------------------------------------------|--------|----------|---------|----------|--------|
|                                               |   |     |    |     |   |
| Total                  revenues                    |   | $        | 730,245 |     | $      | 582,048 |   |
|                                               |   |     |    |     |   |   |   |
| Income                  (loss) before income taxes |   |     | (81,743 | )        |   | 67,709 |   |
|                                               |   |     |    |     |   |   |   |
| Net                  income (loss)                 |   |     | (81,743 | )        |   | 67,709 |   |

----

**Note        8:  **
**Comprehensive        Income**

|                                                     |   | **For                  the Three Months Ended****September                  30,** |     | **For                  the Nine Months Ended****September                  30,** |   |
|----------------------------------------------------------|--------|-----------------------------------------------------------------------------------|----------|----------------------------------------------------------------------------------|--------|
|                                                     |   | **2005**                                                                          |     | **2004**                                                                         |   | **2005** |   | **2004** |   |
| Net                  income (loss)                       |   | $                                                                                 | (160,482 | )                                                                                | $      | 744,538 |   | $ | (624,340 | ) | $ | 283,527 |   |
| Foreign                  currency translation adjustment |   |                                                                              | 207,653  |                                                                             |   | 186,400 |   |   | 143,738 |   |   | 78,788 |   |
| Comprehensive                  income (loss)             |   | $                                                                                 | 47,171   |                                                                             | $      | 930,938 |   | $ | (480,602 | ) | $ | 362,315 |   |

**Note        9:  **
**Additional        Cash Flow Information**

**Note        10:  **
**Subsequent        Event**

----

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

**FORWARD-LOOKING        STATEMENTS**

*This        Quarterly Report on Form 10-QSB 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 registration statement on Form 10-SB/A, filed        on        September 28, 2005, 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-QSB 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% |
|   | March                    31, 2005     | 61% |
|   | June                    30, 2005      | 72% |
|   | September                    30, 2005 | 77% |

| (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. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

***Recent        Developments***

----

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

----

***Selected        Financial Data***

|                                                                                                        | **Three                  Months Ended****September                  30,** |      | **Nine                  Months Ended****September                  30,** |   |
|-------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------|-----------|--------------------------------------------------------------------------|--------|
|                                                                                                        | **2005**                                                                  |      | **2004**                                                                 |   | **2005** |   | **2004** |   |
| **Consolidated                  Summary of Operations:**                                                    |                                                                      |      |                                                                     |   |   |   |   |   |
| Interest                  income                                                                            | $                                                                         | 613,821   |                                                                     | $      | 307,115 |   | $ | 1,604,761 |   | $ | 739,629 |   |
| Recovery                  of charged-off finance receivables                                                |                                                                      | 22,620    |                                                                     |   | 32,383 |   |   | 100,650 |   |   | 129,811 |   |
| Other                  income                                                                               |                                                                      | 21,668    |                                                                     |   | 25,806 |   |   | 72,571 |   |   | 71,313 |   |
| Total                  revenues                                                                             |                                                                      | 658,109   |                                                                     |   | 365,304 |   |   | 1,777,982 |   |   | 940,753 |   |
|                                                                                                        |                                                                      |      |                                                                     |   |   |   |   |   |   |   |   |   |
| Provision                  for credit losses                                                                |                                                                      | 233,559   |                                                                     |   | 74,032 |   |   | 431,847 |   |   | 162,573 |   |
|                                                                                                        |                                                                      |      |                                                                     |   |   |   |   |   |   |   |   |   |
| Net                  revenues after provision for credit losses                                             |                                                                      | 424,550   |                                                                     |   | 291,272 |   |   | 1,346,135 |   |   | 778,180 |   |
|                                                                                                        |                                                                      |      |                                                                     |   |   |   |   |   |   |   |   |   |
| Operating                  expenses                                                                         |                                                                      | 586,618   |                                                                     |   | 502,707 |   |   | 1,973,210 |   |   | 1,450,626 |   |
|                                                                                                        |                                                                      |      |                                                                     |   |   |   |   |   |   |   |   |   |
| Operating                  loss                                                                             |                                                                      | (162,068  | )                                                                        |   | (211,435 | ) |   | (627,075 | ) |   | (672,446 | ) |
|                                                                                                        |                                                                      |      |                                                                     |   |   |   |   |   |   |   |   |   |
| Non-operating                  income                                                                       |                                                                      | 1,586     |                                                                     |   | 955,973 |   |   | 2,735 |   |   | 955,973 |   |
|                                                                                                        |                                                                      |      |                                                                     |   |   |   |   |   |   |   |   |   |
| Income                  (loss) before income taxes                                                          |                                                                      | (160,482  | )                                                                        |   | 744,538 |   |   | (624,340 | ) |   | 283,527 |   |
|                                                                                                        |                                                                      |      |                                                                     |   |   |   |   |   |   |   |   |   |
| Income                  taxes                                                                               |                                                                      | —   |                                                                     |   | — |   |   | — |   |   | — |   |
|                                                                                                        |                                                                      |      |                                                                     |   |   |   |   |   |   |   |   |   |
| Net                  loss                                                                                   | $                                                                         | (160,482  | )                                                                        | $      | 744,538 |   | $ | (624,340 | ) | $ | 283,527 |   |
|                                                                                                        |                                                                      |      |                                                                     |   |   |   |   |   |   |   |   |   |
| Basic                  earnings per share                                                                   | $                                                                         | (0.02     | )                                                                        | $      | 0.07 |   | $ | (0.06 | ) | $ | 0.03 |   |
| Diluted                  earnings per share                                                                 | $                                                                         | (0.02     | )                                                                        | $      | 0.04 |   | $ | (0.06 | ) | $ | 0.01 |   |
| **Other                  Selected Data:**                                                                   |                                                                      |      |                                                                     |   |   |   |   |   |   |   |   |   |
| Installment                  Contracts acquired during the period (total principal                  amount) | $                                                                         | 3,171,617 |                                                                     | $      | 1,915,500 |   | $ | 9,750,545 |   | $ | 4,220,070 |   |
| Purchase                  price of Installment Contracts acquired                                           | $                                                                         | 3,002,790 |                                                                     | $      | 1,636,978 |   | $ | 9,058,592 |   | $ | 3,600,409 |   |
| Percentage                  of dollar amount paid to principal balance acquired                             |                                                                      | 94.7      | %                                                                        |   | 85.5 | % |   | 92.9 | % |   | 85.3 | % |
| Number                  of Installment Contracts acquired during the period                                 |                                                                      | 469       |                                                                     |   | 536 |   |   | 1,642 |   |   | 1,287 |   |
| Average                  principal balance acquired                                                         | $                                                                         | 6,763     |                                                                     | $      | 3,574 |   | $ | 5,938 |   | $ | 3,279 |   |
| Acquisition                  cost per acquired Installment Contract (including                  overhead)   | $                                                                         | 635       |                                                                     |   | Not                  available |   | $ | 571 |   |   | Not                  available |   |
| Monthly                  servicing cost per Installment Contract (including                  overhead)      | $                                                                         | 20.93     |                                                                     |   | Not                  available |   | $ | 28.19 |   |   | Not                  available |   |
|                                                                                                        |                                                                      |      |                                                                     |   |   |   |   |   |   |   |   |   |

----

|                                                              |   | **September                  30,****2005** |       | **December                  31,****2004** |   |
|-------------------------------------------------------------------|--------|--------------------------------------------|------------|-------------------------------------------|--------|
| **Consolidated                  Summary of Financial Condition:** |   |                                       |       |                                      |   |
| Installment                  Contracts receivable, net            |   | $                                          | 9,107,947  |                                      | $      | 4,090,708 |   |
| Total                  assets                                     |   | $                                          | 12,614,105 |                                      | $      | 13,310,925 |   |
|                                                              |   |                                       |       |                                      |   |   |   |
| Total                  liabilities                                |   | $                                          | 223,031    |                                      | $      | 439,249 |   |
| Total                  stockholders' equity                       |   | $                                          | 12,391,074 |                                      | $      | 12,871,676 |   |
|                                                              |   |                                       |       |                                      |   |   |   |

***Results        of Operations***

**Interest        Income**

|                                           |   |                                                                                         |       |         |   |      |   |        |   |         |   |      |   |
|------------------------------------------------|--------|----------------------------------------------------------------------------------------------|------------|--------------|--------|-----------|--------|-------------|--------|--------------|--------|-----------|--------|
|                                           |   | **For                  the Three Months Ended September 30, 2005 and                  2004** |       |
|                                           |   | **2005**                                                                                     |       | **2004**     |   |
|                                           |   | **Average**                                                                                  |       | **Interest** |   |      |   | **Average** |   | **Interest** |   |      |   |
|                                           |   | **Balance**                                                                                  |       | **Income**   |   | **Yield** |   | **Balance** |   | **Income**   |   | **Yield** |   |
|                                           |   |                                                                                         |       |         |   |      |   |        |   |         |   |      |   |
| **Installment                  Contracts**     |   | $                                                                                            | 8,748,961  |         | $      | 585,368   |   |        | 26.76% |         | $      | 3,274,370 |   | $ | 281,249 |   |   | 34.36% |   |
| **Cash                  and cash equivalents** |   |                                                                                         | 3,617,994  |         |   | 27,682    |   |        | 3.06%  |         |   | 6,188,289 |   |   | 19,839 |   |   | 1.28% |   |
| **Notes                  receivable**          |   |                                                                                         | 15,389     |         |   | 771       |   |        | 20.04% |         |   | 191,835   |   |   | 6,027 |   |   | 12.57% |   |
|                                           |   |                                                                                         |       |         |   |      |   |        |   |         |   |      |   |   |   |   |   |   |   |
| **Total**                                      |   | $                                                                                            | 12,382,344 |         | $      | 613,821   |   |        | 19.83% |         | $      | 9,654,494 |   | $ | 307,115 |   |   | 12.72% |   |
|                                           |   |                                                                                         |       |         |   |      |   |        |   |         |   |      |   |   |   |   |   |   |   |
|                                           |   |                                                                                         |            |         |   |           |   |        |        |         |   |           |   |   |  |   |   |  |   |

----

|                                           |   |                                                                       |       |         |   |      |   |        |   |         |   |      |   |
|------------------------------------------------|--------|----------------------------------------------------------------------------|------------|--------------|--------|-----------|--------|-------------|--------|--------------|--------|-----------|--------|
|                                           |   | **For                  the Nine Months Ended September 30, 2005 and 2004** |       |
|                                           |   | **2005**                                                                   |       | **2004**     |   |
|                                           |   | **Average**                                                                |       | **Interest** |   |      |   | **Average** |   | **Interest** |   |      |   |
|                                           |   | **Balance**                                                                |       | **Income**   |   | **Yield** |   | **Balance** |   | **Income**   |   | **Yield** |   |
|                                           |   |                                                                       |       |         |   |      |   |        |   |         |   |      |   |
| **Installment                  Contracts**     |   | $                                                                          | 6,930,311  |         | $      | 1,490,134 |   |        | 28.67% |         | $      | 2,712,946 |   | $ | 682,545 |   |   | 33.55% |   |
| **Cash                  and cash equivalents** |   |                                                                       | 5,648,626  |         |   | 110,912   |   |        | 2.62%  |         |   | 4,810,425 |   |   | 39,557 |   |   | 1.10% |   |
| **Notes                  receivable**          |   |                                                                       | 47,233     |         |   | 3,715     |   |        | 10.49% |         |   | 202,989   |   |   | 17,527 |   |   | 11.51% |   |
|                                           |   |                                                                       |       |         |   |      |   |        |   |         |   |      |   |   |   |   |   |   |   |
| **Total**                                      |   | $                                                                          | 12,626,170 |         | $      | 1,604,761 |   |        | 16.95% |         | $      | 7,726,360 |   | $ | 739,629 |   |   | 12.76% |   |
|                                           |   |                                                                       |       |         |   |      |   |        |   |         |   |      |   |   |   |   |   |   |   |
|                                           |   |                                                                       |            |         |   |           |   |        |        |         |   |           |   |   |  |   |   |  |   |

|                                                     |   | **For                  the Three Months Ended September 30, 2005 Compared****to                  the Three Months Ended September 30, 2004** |    |
|----------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------|---------|
|                                                     |   |                                                                                                                                         |    |   |   |   |   |
|                                                     |   | **Volume**                                                                                                                                   |    | **Rate** |   | **Total** |   |
| Increase                  (decrease) in interest income: |   |                                                                                                                                         |    |   |   |   |   |   |   |   |
| Installment                  Contracts                   |   | $                                                                                                                                            | 350,453 |   | $ | (46,334 | ) | $ | 304,119 |   |
| Cash                  and cash equivalents               |   |                                                                                                                                         | (3,355  | ) |   | 11,199 |   |   | 7,844 |   |
| Notes                  receivable                        |   |                                                                                                                                         | (14,872 | ) |   | 9,615 |   |   | (5,257 | ) |
|                                                     |   |                                                                                                                                         |    |   |   |   |   |   |   |   |
| Total                  Interest Income                   |   | $                                                                                                                                            | 332,226 |   | $ | (25,520 | ) | $ | 306,706 |   |
|                                                     |   |                                                                                                                                         |         |   |   |  |   |   |  |   |

----

|                                                       |   |                                                                                                                                           |    |     |   |      |   |
|------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------|---------|----------|--------|-----------|--------|
|                                                       |   | **For                    the Nine Months Ended September 30, 2005 Compared****to                    the Nine Months Ended September 30, 2004** |    |
|                                                       |   |                                                                                                                                           |    |     |   |      |   |
|                                                       |   | **Volume**                                                                                                                                     |    | **Rate** |   | **Total** |   |
| Increase                    (decrease) in interest income: |   |                                                                                                                                           |    |     |   |      |   |   |   |   |
| Installment                    Contracts                   |   | $                                                                                                                                              | 890,893 |     | $      | (83,306   | )      | $ | 807,587 |   |
| Cash                    and cash equivalents               |   |                                                                                                                                           | 7,960   |     |   | 63,397    |   |   | 71,357 |   |
| Notes                    receivable                        |   |                                                                                                                                           | (12,375 | )        |   | (1,437    | )      |   | (13,812 | ) |
|                                                       |   |                                                                                                                                           |    |     |   |      |   |   |   |   |
| Total                    Interest Income                   |   | $                                                                                                                                              | 886,478 |     | $      | (21,346   | )      | $ | 865,132 |   |

**Provision        for Credit Losses**

**Operating        Expenses**

|                                             |   | **Three                  Months Ended September 30,** |    |
|--------------------------------------------------|--------|-------------------------------------------------------|---------|
|                                             |   | **2005**                                              |    | **2004** |   | **Percent                  Change** |   |
|                                             |   |                                                  |    |   |   |   |   |
| Salaries                  and benefits           |   | $                                                     | 351,014 |   | $ | 272,730 |   |   | 28.7 | % |
| Professional                  fees               |   |                                                  | 91,887  |   |   | 40,428 |   |   | 127.3 | % |
| Bankruptcy                  reorganization costs |   |                                                  | — |   |   | 71,941 |   |   | -100.0 | % |
| Other                                            |   |                                                  | 143,717 |   |   | 117,608 |   |   | 22.2 | % |
| Total                                            |   | $                                                     | 586,618 |   | $ | 502,707 |   |   | 16.7 | % |

----

|                                               |   | **Nine                    Months Ended September 30,** |      |
|----------------------------------------------------|--------|--------------------------------------------------------|-----------|
|                                               |   | **2005**                                               |      | **2004** |   | **Percent                    Change** |   |
|                                               |   |                                                   |      |   |   |   |   |
| Salaries                    and benefits           |   | $                                                      | 1,137,288 |   | $ | 814,595 |   |   | 39.6 | % |
| Professional                    fees               |   |                                                   | 380,355   |   |   | 155,194 |   |   | 145.1 | % |
| Bankruptcy                    reorganization costs |   |                                                   | —   |   |   | 90,818 |   |   | -100.0 | % |
| Pending                    claims - legal fees     |   |                                                   | —   |   |   | 57,328 |   |   | -100.0 | % |
| Other                                              |   |                                                   | 455,567   |   |   | 332,691 |   |   | 36.9 | % |
| Total                                              |   | $                                                      | 1,973,210 |   | $ | 1,450,626 |   |   | 36.0 | % |

***Emergence        From Chapter 11 Reorganization***

----

**Nonoperating        Income**

***Financial        Condition***

**Installment        Contracts Portfolio**

----

|                                         |   | **September                  30, 2005** |      | **December                  31, 2004** |   |
|----------------------------------------------|--------|-----------------------------------------|-----------|----------------------------------------|--------|
|                                         |   | **United                  States**      |      | **Canada**                             |   | **Total** |   | **United                  States** |   | **Canada** |   | **Total** |   |
| Automobiles                                  |   | $                                       | 6,521,997 |                                   | $      | 1,242,089 |   | $ | 7,764,086 |   | $ | 1,963,446 |   | $ | 220,064 |   | $ | 2,183,510 |   |
| Equipment                  leases            |   |                                    | —   |                                   |   | 816,096 |   |   | 816,096 |   |   | — |   |   | 999,724 |   |   | 999,724 |   |
| Bulk                  food                   |   |                                    | —   |                                   |   | 811,964 |   |   | 811,964 |   |   | — |   |   | 962,070 |   |   | 962,070 |   |
| Home                  appliances             |   |                                    | —   |                                   |   | 265,966 |   |   | 265,966 |   |   | — |   |   | 274,800 |   |   | 274,800 |   |
| Other                                        |   |                                    | —   |                                   |   | 471,068 |   |   | 471,068 |   |   | — |   |   | 485,736 |   |   | 485,736 |   |
| Total                                        |   |                                    | 6,521,997 |                                   |   | 3,607,183 |   |   | 10,129,180 |   |   | 1,963,446 |   |   | 2,942,394 |   |   | 4,905,840 |   |
|                                         |   |                                    |      |                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Less                                         |   |                                    |      |                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unearned                  discount           |   |                                    | 426,248   |                                   |   | 204,642 |   |   | 630,890 |   |   | 297,190 |   |   | 221,709 |   |   | 518,899 |   |
| Allowance                  for credit losses |   |                                    | 188,968   |                                   |   | 201,375 |   |   | 390,343 |   |   | 139,921 |   |   | 156,312 |   |   | 296,233 |   |
| Net                                          |   | $                                       | 5,906,781 |                                   | $      | 3,201,166 |   | $ | 9,107,947 |   | $ | 1,526,335 |   | $ | 2,564,373 |   | $ | 4,090,708 |   |

**Asset        Quality**

|                                    |   | **September                  30, 2005** |      |
|-----------------------------------------|--------|-----------------------------------------|-----------|
|                                    |   | **United                  States**      |      | **Canada** |   | **Total** |   |
|                                    |   | **Amount**                              |      | **Pct.** |   | **Amount** |   | **Pct.** |   | **Amount** |   | **Pct.** |   |
|                                    |   |                                    |      |   |   |   |   |   |   |   |   |   |   |
| Installment                  Contracts  |   | $                                       | 6,521,997 |   |   | 100% |   | $ | 3,607,183 |   |   | 100% |   | $ | 10,129,180 |   |   | 100% |   |
|                                    |   |                                    |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Period                  of delinquency: |   |                                    |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 30                  - 59 days           |   | $                                       | 380,242   |   |   | 5.83% |   | $ | 41,706 |   |   | 1.16% |   | $ | 421,948 |   |   | 4.17% |   |
| 60                  - 89 days           |   |                                    | 78,498    |   |   | 1.20% |   |   | 26,864 |   |   | 0.74% |   |   | 105,362 |   |   | 1.04% |   |
| 90                  - 119 days          |   |                                    | 29,722    |   |   | 0.46% |   |   | 37,193 |   |   | 1.03% |   |   | 66,915 |   |   | 0.66% |   |
|                                    |   |                                    |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                   |   | $                                       | 488,462   |   |   | 7.49% |   | $ | 105,763 |   |   | 2.93% |   | $ | 594,225 |   |   | 5.87% |   |

----

|                                    |   |                                   |      |       |   |       |   |     |      |       |   |     |   |
|-----------------------------------------|--------|----------------------------------------|-----------|------------|--------|------------|--------|----------|-----------|------------|--------|----------|--------|
|                                    |   | **December                  31, 2004** |      |
|                                    |   | **United                  States**     |      | **Canada** |   | **Total**  |   |
|                                    |   | **Amount**                             |      | **Pct.**   |   | **Amount** |   | **Pct.** |      | **Amount** |   | **Pct.** |   |
|                                    |   |                                   |      |       |   |       |   |     |      |       |   |     |   |
| Installment                  Contracts  |   | $                                      | 1,963,446 |       |   | 100%       |   | $        | 2,942,394 |       |   | 100%     |   | $ | 4,905,840 |   |   | 100% |   |
|                                    |   |                                   |      |       |   |       |   |     |      |       |   |     |   |   |   |   |   |   |   |
| Period                  of delinquency: |   |                                   |      |       |   |       |   |     |      |       |   |     |   |   |   |   |   |   |   |
| 30                  - 59 days           |   | $                                      | 167,009   |       |   | 8.51%      |   | $        | 50,547    |       |   | 1.72%    |   | $ | 217,556 |   |   | 4.43% |   |
| 60                  - 89 days           |   |                                   | 60,788    |       |   | 3.10%      |   |     | 15,660    |       |   | 0.53%    |   |   | 76,448 |   |   | 1.56% |   |
| 90                  - 119 days          |   |                                   | 24,133    |       |   | 1.23%      |   |     | 21,434    |       |   | 0.73%    |   |   | 45,567 |   |   | 0.93% |   |
|                                    |   |                                   |      |       |   |       |   |     |      |       |   |     |   |   |   |   |   |   |   |
| Total                                   |   | $                                      | 251,930   |       |   | 12.83%     |   | $        | 87,641    |       |   | 2.98%    |   | $ | 339,571 |   |   | 6.92% |   |

|                                                                                                              |   | **Three                  Months Ended****September                  30, 2005** |      | **Three                  Months Ended****September                  30, 2004** |   |
|-------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------|-----------|--------------------------------------------------------------------------------|--------|
|                                                                                                              |   | **United                  States**                                             |      | **Canada**                                                                     |   | **Total** |   | **United                  States** |   | **Canada** |   | **Total** |   |
|                                                                                                              |   |                                                                           |      |                                                                           |   |   |   |   |   |   |   |   |   |
| Installment                  Contracts, net of unearned discounts, end of period                                  |   | $                                                                              | 6,095,749 |                                                                           | $      | 3,402,541 |   | $ | 9,498,290 |   | $ | 1,239,463 |   | $ | 2,450,203 |   | $ | 3,689,666 |   |
|                                                                                                              |   |                                                                           |      |                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Installment                  Contracts, net of unearned discounts, average during the period                  (1) |   | $                                                                              | 5,571,111 |                                                                           | $      | 3,177,850 |   | $ | 8,748,961 |   | $ | 1,014,166 |   | $ | 2,260,205 |   | $ | 3,274,371 |   |
|                                                                                                              |   |                                                                           |      |                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gross                  charge-offs                                                                                |   | $                                                                              | 249,738   |                                                                           | $      | 82,831 |   | $ | 332,569 |   | $ | 38,651 |   | $ | 26,593 |   | $ | 65,244 |   |
| Recoveries                                                                                                        |   |                                                                           | 125,881   |                                                                           |   | 32,970 |   |   | 158,851 |   |   | — |   |   | 30,603 |   |   | 30,603 |   |
|                                                                                                              |   |                                                                           |      |                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  charge-offs                                                                                  |   | $                                                                              | 123,857   |                                                                           | $      | 49,861 |   | $ | 173,718 |   | $ | 38,651 |   | $ | (4,010 | ) | $ | 34,641 |   |
|                                                                                                              |   |                                                                           |      |                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  charge-offs as a % of avg. contracts during the period,                  annualized          |   |                                                                           | 8.89      | %                                                                              |   | 6.28 | % |   | 7.94 | % |   | 15.24 | % |   | (0.71 | )% |   | 4.23 | % |
|                                                                                                              |   |                                                                           |      |                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (1)                  - Average is based on month-end                  balances                                    |

----

|                                                                                                              |   | **Nine                  Months Ended****September                  30, 2005** |      | **Nine                  Months Ended****September                  30, 2004** |   |
|-------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------|-----------|-------------------------------------------------------------------------------|--------|
|                                                                                                              |   | **United                  States**                                            |      | **Canada**                                                                    |   | **Total** |   | **United                  States** |   | **Canada** |   | **Total** |   |
|                                                                                                              |   |                                                                          |      |                                                                          |   |   |   |   |   |   |   |   |   |
| Installment                  Contracts, net of unearned discounts, end of period                                  |   | $                                                                             | 6,095,749 |                                                                          | $      | 3,402,541 |   | $ | 9,498,290 |   | $ | 1,239,463 |   | $ | 2,450,203 |   | $ | 3,689,666 |   |
|                                                                                                              |   |                                                                          |      |                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Installment                  Contracts, net of unearned discounts, average during the period                  (1) |   | $                                                                             | 4,091,902 |                                                                          | $      | 2,838,409 |   | $ | 6,930,311 |   | $ | 626,025 |   | $ | 2,086,921 |   | $ | 2,712,946 |   |
|                                                                                                              |   |                                                                          |      |                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gross                  charge-offs                                                                                |   | $                                                                             | 484,203   |                                                                          | $      | 168,289 |   | $ | 652,492 |   | $ | 42,962 |   | $ | 99,736 |   | $ | 142,698 |   |
| Recoveries                                                                                                        |   |                                                                          | 219,159   |                                                                          |   | 85,225 |   |   | 304,384 |   |   | — |   |   | 110,557 |   |   | 110,557 |   |
|                                                                                                              |   |                                                                          |      |                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  charge-offs                                                                                  |   | $                                                                             | 265,044   |                                                                          | $      | 83,064 |   | $ | 348,108 |   | $ | 42,962 |   | $ | (10,821 | ) | $ | 32,141 |   |
|                                                                                                              |   |                                                                          |      |                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  charge-offs as a % of avg. contracts during the period,                  annualized          |   |                                                                          | 8.64      | %                                                                             |   | 3.90 | % |   | 6.70 | % |   | 9.15 | % |   | (0.69 | )% |   | 1.58 | % |
|                                                                                                              |   |                                                                          |      |                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (1)                  - Average is based on month-end                  balances                                    |

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

----

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

|                                                    |   | **Three                  Months Ended****September                  30, 2005** |     | **Three                  Months Ended****September                  30, 2004** |   |
|---------------------------------------------------------|--------|--------------------------------------------------------------------------------|----------|--------------------------------------------------------------------------------|--------|
|                                                    |   | **United                  States**                                             |     | **Canada**                                                                     |   | **Total** |   | **United                  States** |   | **Canada** |   | **Total** |   |
|                                                    |   |                                                                           |     |                                                                           |   |   |   |   |   |   |   |   |   |
| Balance                  at beginning of period         |   | $                                                                              | 153,954  |                                                                           | $      | 163,980 |   | $ | 317,934 |   | $ | 157,287 |   | $ | 124,945 |   | $ | 282,232 |   |
|                                                    |   |                                                                           |     |                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Charge-offs                                             |   |                                                                           | (249,738 | )                                                                              |   | (82,831 | ) |   | (332,569 | ) |   | (38,651 | ) |   | (26,593 | ) |   | (65,244 | ) |
| Recoveries                                              |   |                                                                           | 125,881  |                                                                           |   | 32,970 |   |   | 158,851 |   |   | — |   |   | 30,603 |   |   | 30,603 |   |
|                                                    |   |                                                                           |          |                                                                           |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Net                  charge-offs                        |   |                                                                           | (123,857 | )                                                                              |   | (49,861 | ) |   | (173,718 | ) |   | (38,651 | ) |   | 4,010 |   |   | (34,641 | ) |
|                                                    |   |                                                                           |     |                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Provision                  for credit losses            |   |                                                                           | 158,871  |                                                                           |   | 74,688 |   |   | 233,559 |   |   | 63,237 |   |   | 10,795 |   |   | 74,032 |   |
|                                                    |   |                                                                           |     |                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Effect                  of foreign currency translation |   |                                                                           | —  |                                                                           |   | 12,568 |   |   | 12,568 |   |   | — |   |   | 8,118 |   |   | 8,118 |   |
|                                                    |   |                                                                           |     |                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                  at end of period               |   | $                                                                              | 188,968  |                                                                           | $      | 201,375 |   | $ | 390,343 |   | $ | 181,873 |   | $ | 147,868 |   | $ | 329,741 |   |

----

|                                                    |   | **Nine                  Months Ended****September                  30, 2005** |     | **Nine                  Months Ended****September                  30, 2004** |   |
|---------------------------------------------------------|--------|-------------------------------------------------------------------------------|----------|-------------------------------------------------------------------------------|--------|
|                                                    |   | **United                  States**                                            |     | **Canada**                                                                    |   | **Total** |   | **United                  States** |   | **Canada** |   | **Total** |   |
|                                                    |   |                                                                          |     |                                                                          |   |   |   |   |   |   |   |   |   |
| Balance                  at beginning of period         |   | $                                                                             | 139,921  |                                                                          | $      | 156,312 |   | $ | 296,233 |   | $ | 32,463 |   | $ | 164,235 |   | $ | 196,698 |   |
|                                                    |   |                                                                          |     |                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Charge-offs                                             |   |                                                                          | (484,203 | )                                                                             |   | (168,289 | ) |   | (652,492 | ) |   | (42,962 | ) |   | (99,736 | ) |   | (142,698 | ) |
| Recoveries                                              |   |                                                                          | 219,159  |                                                                          |   | 85,225 |   |   | 304,384 |   |   | — |   |   | 110,557 |   |   | 110,557 |   |
|                                                    |   |                                                                          |          |                                                                          |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Net                  charge-offs                        |   |                                                                          | (265,044 | )                                                                             |   | (83,064 | ) |   | (348,108 | ) |   | (42,962 | ) |   | 10,821 |   |   | (32,141 | ) |
|                                                    |   |                                                                          |     |                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Provision                  for credit losses            |   |                                                                          | 314,091  |                                                                          |   | 117,756 |   |   | 431,847 |   |   | 192,372 |   |   | (29,799 | ) |   | 162,573 |   |
|                                                    |   |                                                                          |     |                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Effect                  of foreign currency translation |   |                                                                          | —  |                                                                          |   | 10,371 |   |   | 10,371 |   |   | — |   |   | 2,611 |   |   | 2,611 |   |
|                                                    |   |                                                                          |     |                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance                  at end of period               |   | $                                                                             | 188,968  |                                                                          | $      | 201,375 |   | $ | 390,343 |   | $ | 181,873 |   | $ | 147,868 |   | $ | 329,741 |   |

***Liquidity        and Capital Resources***

----

***Recent        Developments***

***Off-Balance        Sheet Arrangements***

----

**ITEM        3.  **
**Controls        and Procedures**
** **

----

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

**ITEM        1.  **
**Legal        Proceedings**
** **

**ITEM        2.  **
**Unregistered        Sales of Equity Securities and Use of Proceeds**

**ITEM        3.  **
**Defaults        Upon Senior Securities**

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

**ITEM        5.  **
**Other        Information**

----

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

**INDEX        TO EXHIBITS**

|        |   |                                                                                                                                                                                                                |
|-------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **Exhibit** |   |                                                                                                                                                                                                                |
| **Number**  |   | **Description**                                                                                                                                                                                                     |
|        |   |                                                                                                                                                                                                                |
| 2.1*        |   | Corrected                  Trustee’s Amended Plan of Reorganization                                                                                                                                           |
| 2.2*        |   | Disclosure                  Statement for Trustee’s Amended Plan of Reorganization                                                                                                                            |
| 3.1*        |   | First                  Amended and Restated Certificate of Incorporation                                                                                                                                            |
| 3.1.1*      |   | Certificate                  of Amendment to Certificate of Incorporation                                                                                                                                           |
| 3.2*        |   | Bylaws                                                                                                                                                                                                              |
| 3.2.1*      |   | Amendment                  to Bylaws                                                                                                                                                                                |
| 4.1*        |   | Amended                  and Restated Trust Agreement of Freedom Financial Group I Statutory                  Trust                                                                                                 |
| 10.1*       |   | Employment                  Agreement with Jerald L. Fenstermaker                                                                                                                                                   |
| 10.2*       |   | Investment                  Banking Agreement with Milestone Advisors, LLC                                                                                                                                          |
| 10.3*       |   | Unanimous                  Consent of the Board of Directors Adopting Executive Management                  Stock                  Bonus Plan                                                                       |
| 10.4*       |   | Office                  Lease - 3058 East Elm                                                                                                                                                                       |
| 10.5**      |   | Purchase                  and Sale Agreement, dated April 7, 2003, between Freedom Financial                  Group,                  Inc. (as Seller) and The Cadle Company (as Buyer)                             |
| 10.6**      |   | Commercial                  Real Estate Purchase Contract, dated May 9, 2003, between Freedom                  Financial Group, Inc. (as Seller) and New Life Church of God (as                  Buyer)             |
| 10.7**      |   | Real                  Estate Sale Contract, dated June 4, 2003, between Donald D. Bass                  and Don                  W. Bass (as Buyers) and Freedom Financial Group, Inc. (as                  Seller) |
| 10.8**      |   | Application                  and Order by Bankruptcy Court Approving Employment of Biltmore                  Associates                                                                                             |
| 11.1        |   | Statement                  Re: Computation of Per Share Earnings - See Note 5 to Condensed                  Consolidated Financial Statements                                                                       |
| 14.1***     |   | Code                  of Ethics                                                                                                                                                                                     |
| 31.1        |   | Certification                  of Chief Executive Officer Under Section 302 of the Sarbanes-Oxley                  Act of                  2002                                                                     |
| 31.2        |   | Certification                  of Chief Financial Officer Under Section 302 of the Sarbanes-Oxley                  Act of                  2002                                                                     |
| 32.1        |   | Certifications                  of the Chief Executive Officer and Chief Financial Officer under                  Section                  906 of the Sarbanes-Oxley Act of                  2002                   |

***Recent        Developments***
**ITEM        2**

----

**SIGNATURES**

|                                         |                                                                                        |                                                       |
|----------------------------------------------|---------------------------------------------------------------------------------------------|------------------------------------------------------------|
|                                         | **FREEDOM                FINANCIAL GROUP, INC.**                                            |
|                                    |                                                                                   |                                                  |
| Date: November                11, 2005  | By:                                                                               | /s/ Jerald                L. Fenstermaker             |
|                                    | Jerald                L. Fenstermaker, President and Chief Executive                Officer |
|                                         |                                                                                             |                                                       |
|                                         |                                                                                        |                                                       |
| Date:  November                11, 2005 | By:                                                                                    | /s/ Daniel F. Graham                                       |
|                                         |                                                                                        | Daniel                  F. Graham, Chief Financial Officer |

----