FORM 10-Q

              SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549

     [x]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
              THE SECURITIES EXCHANGE ACT OF 1934

          For the quarterly period ended March 31, 1998
                             or

     [ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
              OF THE SECURITIES EXCHANGE ACT OF 1934

          For the transition period from   N/A   to   N/A

                   Commission File Number: 0-15448

                 CENTENNIAL MORTGAGE INCOME FUND II
        (Exact name of registrant as specified in its charter)

           California                          33-0112106
(State or other jurisdiction of             (I.R.S. Employer
 incorporation or organization)             Identification No.)

 1540 South Lewis Street, Anaheim, California        92805
  (Address of principal executive offices)         (Zip Code)

Registrant's telephone number, including area code: (714)502-8484

Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                          YES  X     NO












                             PART I


ITEM 1. FINANCIAL STATEMENTS


       CENTENNIAL MORTGAGE INCOME FUND II AND SUBSIDIARIES
                      A Limited Partnership

                   Consolidated Balance Sheets
<TABLE>
<CAPTION>

<S>                              <C>               <C>
                                    March 31,        December 31,
                                      1998               1997
   Assets                          (Unaudited)
-----------------------------------------------------------------
Cash and cash equivalents         $    332,000      $    195,000

Real estate loans
  receivable, earning                      ---           215,000
Real estate loans receivable
  from unconsolidated investee,
  nonearning (note 4)                  724,000           814,000
-----------------------------------------------------------------
                                       724,000         1,029,000

 Less allowance for possible
  loan losses                              ---            15,000
-----------------------------------------------------------------
Net real estate loans receivable       724,000         1,014,000
-----------------------------------------------------------------
Real estate owned, held
  for sale (note 3)                 10,827,000        10,827,000

 Less allowance for possible loan
  losses on real estate owned        2,702,000         2,702,000
-----------------------------------------------------------------
Net real estate owned                8,125,000         8,125,000
-----------------------------------------------------------------







   See accompanying notes to consolidated financial statements
                               1
       CENTENNIAL MORTGAGE INCOME FUND II AND SUBSIDIARIES
                      A Limited Partnership

                   Consolidated Balance Sheets
                          (Continued)

<CAPTION>

<S>                              <C>               <C>
                                    March 31,        December 31,
                                      1998               1997
   Assets                          (Unaudited)
-----------------------------------------------------------------
Due from affiliates                     16,000            16,000
Other assets, net                       14,000             4,000
-----------------------------------------------------------------
                                  $  9,211,000      $  9,354,000
=================================================================

Liabilities and Partners' Equity
-----------------------------------------------------------------
Note payable                      $     85,000      $     97,000
Accounts payable and
  accrued liabilities                   28,000             9,000
Interest and property taxes
  payable on real estate owned         552,000           484,000
-----------------------------------------------------------------
   Total liabilities                   665,000           590,000
-----------------------------------------------------------------
Partners' equity (deficit)
  -- 29,141 limited partnership
  units outstanding at
  March 31, 1998 and
  December 31, 1997
    General partners                  (195,000)         (195,000)
    Limited partners                 8,741,000         8,959,000
-----------------------------------------------------------------
    Total partners' equity           8,546,000         8,764,000

Contingencies (note 5)
-----------------------------------------------------------------
                                  $  9,211,000      $  9,354,000
=================================================================

</TABLE>



   See accompanying notes to consolidated financial statements
                               2
       CENTENNIAL MORTGAGE INCOME FUND II AND SUBSIDIARIES
                      A Limited Partnership

              Consolidated Statements of Operations


<TABLE>
<CAPTION>
          For the three months ended March 31, 1998 and 1997

<S>                              <C>               <C>
                                       1998             1997
                                   (Unaudited)      (Unaudited)
-----------------------------------------------------------------
Revenue:
Interest income on loans
  to nonaffiliates,
  including fees                  $     5,000       $     4,000
Interest on interest-
  bearing deposits                      2,000             2,000
Income from operations
  of real estate owned                 38,000            32,000
Other                                     ---            11,000
-----------------------------------------------------------------
    Total revenue                      45,000            49,000

Expenses:
Share of losses in
  unconsolidated investee              54,000            29,000
Operating expenses
  from operations of
  real estate owned                    19,000            18,000
Operating expenses
  from operations of
  real estate owned
  paid to affiliates                    3,000             3,000
Expenses associated
  with non-operating
  real estate owned                   125,000           105,000
Depreciation and
  amortization expense                  1,000             2,000
Interest expense                        2,000             3,000






   See accompanying notes to consolidated financial statements
                              3
          CENTENNIAL MORTGAGE INCOME FUND II AND SUBSIDIARIES
                        A Limited Partnership

               Consolidated Statements of Operations
                         (Continued)

<CAPTION>
      For the three months ended March 31, 1998 and 1997

<S>                              <C>               <C>
                                       1998             1997
                                   (Unaudited)      (Unaudited)
-----------------------------------------------------------------
General and administrative,
  affiliates                           45,000            44,000
General and administrative,
  nonaffiliates                        14,000            13,000
-----------------------------------------------------------------
    Total expenses                    263,000           217,000
-----------------------------------------------------------------
  Net loss                        $  (218,000)      $  (168,000)
=================================================================
Net loss per limited
  partnership unit                $     (7.48)      $     (5.77)
=================================================================

</TABLE>





















   See accompanying notes to consolidated financial statements
                              4
       CENTENNIAL MORTGAGE INCOME FUND II AND SUBSIDIARIES
                      A Limited Partnership

           Consolidated Statement of Partners' Equity

<TABLE>
<CAPTION>

             For the three months ended March 31, 1998
<S>                   <C>            <C>            <C>
                                                        Total
                         General        Limited        Partners'
                         Partners       Partners        Equity
                       (Unaudited)    (Unaudited)    (Unaudited)
-----------------------------------------------------------------
Balance at
  December 31, 1997   $  (195,000)   $  8,959,000   $  8,764,000

Net loss                      ---        (218,000)      (218,000)
-----------------------------------------------------------------
Balance at
  March 31, 1998      $  (195,000)   $  8,741,000   $  8,546,000
=================================================================

</TABLE>























   See accompanying notes to consolidated financial statements
                               5
       CENTENNIAL MORTGAGE INCOME FUND II AND SUBSIDIARIES
                      A Limited Partnership

              Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>

      For the three months ended March 31, 1998 and 1997


<S>                                <C>             <C>
                                       1998             1997
                                    (Unaudited)      (Unaudited)
-----------------------------------------------------------------
Cash flows from
 operating activities:
  Net loss                         $  (218,000)     $ (168,000)
  Adjustments to reconcile net
   loss to net cash used in
   operating activities:
     Depreciation and
      amortization expense               1,000           2,000
     Equity in losses of
      unconsolidated investee           54,000          29,000
Changes in assets
  and liabilities:
   Increase in other assets            (11,000)        (19,000)
   Increase in payable
    to affiliates                          ---           2,000
   Increase (decrease) in
    accounts payable and
    accrued liabilities                 19,000          (3,000)
   Increase in interest
    and taxes payable
    on real estate owned                68,000          65,000
-----------------------------------------------------------------
Net cash used in
  operating activities                 (87,000)        (92,000)
-----------------------------------------------------------------








   See accompanying notes to consolidated financial statements
                               6
       CENTENNIAL MORTGAGE INCOME FUND II AND SUBSIDIARIES
                      A Limited Partnership

           Consolidated Statements of Cash Flows
                          (Continued)

<CAPTION>
       For the three months ended March 31, 1998 and 1997
<S>                                <C>             <C>
                                       1998             1997
                                    (Unaudited)      (Unaudited)
-----------------------------------------------------------------
Cash flows from
  investing activities:
   Principal collected on loans        236,000          47,000
   Advances on loans made
     to unconsolidated
     investees                             ---         (56,000)
-----------------------------------------------------------------
Net cash provided by (used in)
  investing activities                 236,000          (9,000)
-----------------------------------------------------------------
Cash flows used in
  financing activities:
   Principal payments on
    notes payable                      (12,000)        (11,000)
-----------------------------------------------------------------
Net increase (decrease) in cash        137,000        (112,000)

Beginning cash and
  cash equivalents                     195,000          261,000
-----------------------------------------------------------------
Ending cash and cash
  equivalents                      $   332,000      $   149,000
=================================================================
Supplemental schedule of
  cash flow information:
   Cash paid during the
     quarter for:
       Interest                    $     2,000      $     3,000








See accompanying notes to consolidated financial statements
                              7
       CENTENNIAL MORTGAGE INCOME FUND II AND SUBSIDIARIES
                      A Limited Partnership

           Notes to Consolidated Financial Statements
                          (Unaudited)

                     March 31, 1998 and 1997

(1)  BUSINESS

Centennial Mortgage Income Fund II (the "Partnership") was formed
in 1985 and initially invested in commercial, industrial and
residential income-producing real property through mortgage
investments consisting of participating first mortgage loans,
other equity participation loans, construction loans, and wrap-
around and other junior loans.  The Partnership's underwriting
policy for granting credit was to fund loans secured by first and
second deeds of trust on real property.  The Partnership's area
of concentration is in California.  In the normal course of
business, the Partnership participated with other lenders in
extending credit to single borrowers.  The Partnership did this
in an effort to decrease credit concentrations and provide a
greater diversification of credit risk.

As of March 31, 1998, most of the loans secured by operating
properties have been repaid to the Partnership.  However, during
the early 1990's, real estate market values for undeveloped land
in California declined severely.  As the loans secured by
undeveloped land became delinquent, the Partnership elected to
foreclose on certain of these loans, thereby increasing real
estate owned balances.  As a result, the Partnership has become a
direct investor in this real estate and intends to manage
operating properties and develop raw land until such time as the
Partnership is able to sell this real estate owned.

As required by the Partnership Agreement, the Partnership is
currently in the repayment stage, and as a result, cash proceeds
from mortgage investments are no longer available for
reinvestment.

(2)  BASIS OF PRESENTATION

The consolidated financial statements are unaudited and reflect
all adjustments, consisting only of normal recurring accruals,
which are, in the opinion of management, necessary for a fair
statement of the results of operations for the interim periods.
Results for the three months ended March 31, 1998 and 1997 are
not necessarily indicative of results which may be expected for
any other interim period, or for the year as a whole.
                              8
Information pertaining to the three months ended March 31, 1998
and 1997 is unaudited and condensed inasmuch as it does not
include all related footnote disclosures.

The condensed consolidated financial statements do not include
all information and footnotes necessary for fair presentation of
financial position, results of operations and cash flows in
conformity with generally accepted accounting principles.  Notes
to consolidated financial statements included in Form 10-K for
the year ended December 31, 1997 on file with the Securities and
Exchange Commission, provide additional disclosures and a further
description of accounting policies.

Net Loss per Limited Partnership Unit

Net loss per limited partnership unit was based on the weighted
average number of limited partnership units outstanding of 29,141
for all periods presented.

Impaired Loans

The Partnership considers a loan to be impaired when based upon
current information and events, it believes it is probable that
the Partnership will be unable to collect all amounts due
according to the contractual terms of the loan agreement.  In
determining impairment, the Partnership considers large non-
homogeneous loans including nonaccrual loans, troubled debt
restructuring and performing loans which exhibit, among other
characteristics, high loan-to-value ratios, low debt-coverage
ratios, or other indications that the borrowers are experiencing
increased levels of financial difficulty.  The Partnership bases
the measurement of collateral-dependent impaired loans on the
fair value of the loan's collateral.  The amount by which the
recorded investment of the loan exceeds the measure of the
impaired loan's value is recognized by recording a valuation
allowance.

At March 31, 1998, the carrying value of loans that are
considered to be impaired under SFAS 114 totaled $724,000 (all of
which were on nonaccrual status).  At March 31, 1998, there was
no allowance for possible loan losses determined in accordance
with the provisions of SFAS 114, related to loans considered
impaired under SFAS 114.  This is due to the fact that all the
remaining loans considered to be impaired were to an
unconsolidated investee.  The unconsolidated investee has
recorded an allowance for losses of $4,148,000 and the
Partnership's proportionate share of losses in unconsolidated

                              9
investee reflects the majority of this allowance.  There was no
investment in impaired loans during the three months ended March
31, 1998.  For the three months ended March 31, 1998, the
Partnership recognized no interest income nor cash basis income
on these impaired loans.


</TABLE>
<TABLE>

(3)  REAL ESTATE OWNED

<CAPTION>
Real estate owned consists of the following:
                                     (dollars in thousands)
<S>                               <C>              <C>
                                      March 31,      December 31,
                                        1998             1997
-----------------------------------------------------------------
1.  Office building in
      San Bernardino, CA             $   827         $   827
2.  Land in Sacramento, CA             3,637           3,637
3.  Proposed marina and condominiums
      in Redwood City, CA              5,360           5,360
4.  10.66 acres in Roseville, CA       1,003           1,003
-----------------------------------------------------------------
Total real estate owned              $10,827         $10,827
=================================================================
</TABLE>
(4)  TRANSACTIONS WITH AFFILIATES

Under the provisions of the Partnership Agreement, the general
partners are to receive compensation for their services in
supervising the affairs of the Partnership.  This partnership
management compensation shall be equal to 10 percent of the cash
available for distribution, as defined in the Partnership
Agreement.  The general partners will not receive this
compensation until the limited partners have received a 12
percent per annum cumulative return on their adjusted invested
capital, but are entitled to receive a 5 percent interest in cash
available for distribution in any year until this provision has
been met.  Adjusted invested capital is defined as the original
capital invested less distributions from mortgage reductions.
Payments to the general partners have been limited to 5 percent
of cash available for distribution as the limited partners have
not received their 12 percent per annum cumulative return.  Under
this provision of the Partnership Agreement, no distributions
were paid to the general partners during the three months ended
March 31, 1998 or 1997.

The Partnership owns 50 percent of the outstanding capital stock
                             10
of a corporation which has not been consolidated in the
accompanying financial statements, LCR Development, Inc.,
("LCR").  The balance of outstanding capital stock in this
corporation is owned by Centennial Mortgage Income Fund,
("CMIF"), an affiliate.  LCR has invested in a joint venture,
Silverwood Homes ("Silverwood") which is constructing homes in
Lancaster, California.  The Partnership has participated in
making several loans to this corporation and this joint venture.
Under the equity method of accounting, these loans are a
component of the Partnership's investment in LCR , and therefore,
the Partnership has recorded losses by LCR as a reduction of the
carrying value of these loans receivable.

The Partnership holds a 50 percent participation in an unsecured
note in the amount of $2,115,000 due from LCR.  The Partnership's
share of the note at March 31, 1998 is $1,059,000 and the
Partnership had applied $1,059,000, a portion of the cumulative
losses from unconsolidated investee, against the carrying value
of the note as of that same date.  The Partnership has not
accrued its share of interest on this note which was
approximately $345,000 as of March 31, 1998.

Silverwood began constructing a model home complex at the project
in June 1995. Construction commenced in September 1995 on Phase I
at the project.  Construction of Phase II of the project was
commenced in February 1997.  At March 31, 1998, the Partnership
holds a 50 percent participation in three notes due from
Silverwood consisting of a land development loan, a model home
loan and a home construction loan.  The Partnership's disbursed
balance of the $3,265,700 development loan at March 31, 1998 is
$906,000 and the Partnership had applied $431,000, the balance of
cumulative losses from unconsolidated investee against the
carrying value of the note as of the same date.  The
Partnership's disbursed balance of the $490,000 model loan at
March 31, 1998 is $245,000.  At March 31, 1998, the Partnership's
disbursed balance of the $1,034,000 Phase I construction loan is
$4,000.

The consolidated balance sheet and income statement of LCR have
not been consolidated in the Partnership's financial statements.
The Partnership accounts for its investment in this corporation
using the equity method.  The following represents condensed
financial information for LCR Development, Inc. at March 31, 1998
and for the three months ended March 31, 1998:





                            11
                       LCR Development, Inc.
                    Consolidated Balance Sheet
                          (Unaudited)
<TABLE>
<CAPTION>

<S>                                           <C>
                                                  March 31,
  Assets                                            1998
-----------------------------------------------------------------
Cash                                             $    23,000
Restricted cash                                       20,000

Real estate owned, held for investment             6,657,000
Less allowance for losses
  on real estate investment                        4,148,000
-----------------------------------------------------------------
Net real estate owned                              2,509,000

Organization costs                                     1,000
-----------------------------------------------------------------
                                                 $ 2,553,000
=================================================================

  Liabilities and Stockholders' Deficit
-----------------------------------------------------------------
Notes payable to affiliates
  CMIF                                           $ 4,479,000
  CMIF II                                          2,214,000
-----------------------------------------------------------------
Total notes payable                                6,693,000

Accounts payable and accrued liabilities               9,000
Interest and taxes payable on real property        1,544,000
Payable to affiliates                                 46,000
-----------------------------------------------------------------
Total liabilities                                  8,292,000

Stockholders' deficit                             (5,739,000)
-----------------------------------------------------------------
                                                 $ 2,553,000
=================================================================
</TABLE>






                             12
                   LCR Development, Inc.
            Consolidated Statement of Operations
                       (Unaudited)
<TABLE>
<CAPTION>
<S>                             <C>            <C>
                                  Three months     Three months
                                      ended           ended
                                  March 31, 1998   March 31, 1997
-----------------------------------------------------------------
Housing sales                     $   418,000    $    92,000

Cost of housing sales                 383,000        104,000
Provision for losses                  135,000        138,000
Selling and marketing expenses         24,000         29,000
General and administrative expenses     9,000         15,000
-----------------------------------------------------------------
Operating income (loss)              (133,000)      (194,000)
Interest expense                      105,000            ---
-----------------------------------------------------------------
Net loss before income taxes         (238,000)      (194,000)
Income taxes                            1,000          1,000
-----------------------------------------------------------------
Net loss                             (239,000)      (195,000)
=================================================================
Interest expense not included
  in share of losses                 (131,000)      (138,000)
-----------------------------------------------------------------
Allocable net loss                $  (108,000)   $   (57,000)
=================================================================
Share of loss recorded            $   (54,000)   $   (29,000)
=================================================================
</TABLE>

(5) CONTINGENCIES

There are no material pending legal proceedings other than
ordinary routine litigation incidental to the Partnership's
business.  Based in part of advice of legal counsel, management
does not believe that the results of any of these matters will
have a material impact on the Partnership's financial position or
results of operations.







                             13
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND  RESULTS OF OPERATIONS.

GENERAL

References to the "Partnership" in the following discussion
refers to Centennial Mortgage Income Fund II and its wholly-owned
subsidiaries.

The Partnership had net losses and losses per limited partnership
unit of $(218,000) and $(7.48) and $(168,000) and $(5.77) for the
three months ended March 31, 1998 and March 31, 1997,
respectively.  The losses for 1998 are primarily the result of
expenses associated with non-operating real estate owned.

Cautionary Statements Regarding Forward-Looking Information

The Partnership wishes to caution readers that the
forward-looking statements contained in this Form 10-Q under
"Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations" and elsewhere in this Form
10-Q involve known and unknown risks and uncertainties which may
cause the actual results, performance or achievements of the
Partnership to be materially different from any future results,
performance or achievements expressed or implied by any forward-
looking statements made by or on behalf of the Partnership.  In
connection with the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995, the Partnership is
filing the following cautionary statements identifying important
factors that in some cases have affected, and in the future could
cause the Partnership's actual results to differ materially from
those expressed in any such forward-looking statements.

The factors that could cause the Partnership's results to differ
materially include, but are not limited to, general economic and
business conditions, including interest rate fluctuations; the
impact of competitive products and pricing; success of operating
initiatives; adverse publicity; changes in business strategy or
development plans; quality of management; availability, terms and
deployment of capital; the results of financing efforts; business
abilities and judgment of personnel; availability of qualified
personnel; employee benefit costs and changes in, or the failure
to comply with government regulations.

LIQUIDITY AND CAPITAL RESOURCES

At March 31, 1998, the Partnership had $332,000 in unrestricted
cash and interest-bearing deposits.  The Partnership had no
unfunded loan commitments to nonaffiliates at March 31, 1998.
Sources of funds are expected to be from the sale of real estate
owned.  Future operations of real estate owned are not expected
to be a significant source of funds.  The Partnership received
payoffs and paydowns on loans totaling $236,000 during the three
months ended March 31, 1998.

As of March 31, 1998, the Partnership has entered into purchase
and sale agreements to sell two properties and a portion of a
third property with an aggregate book value before allowance for
losses of approximately $7.3 million and a net book value after
allowances of approximately $5.3 million.  Management currently
estimates that the net sale proceeds from these transactions, if
they are consummated, will be equal to or greater than the net
book value after allowances for losses.  The only debt
encumbering these properties is approximately $552,000 in accrued
real estate taxes.  As discussed in greater detail below, these
sales are subject to numerous uncertainties and it is very likely
that one or more of the transactions will not be consummated.
Additionally, as of March 31, 1998, the Partnership's
unconsolidated subsidiary, LCR, had entered into a purchase and
sale agreement to sell its remaining undeveloped lots.

The Partnership's notes payable commitments for the next year
consist of interest and principal payments due of approximately
$58,000 payable during the next twelve months.  In addition to
the note payable commitments, the Partnership's principal capital
requirements include: (i) real property taxes on real estate
owned of approximately $820,000 payable and delinquent during the
next twelve months, and (ii) selling, general and administrative
costs.  The Partnership can apply for a 5 year redemption plan on
a portion of the property taxes due in 1998 to ease liquidity
constraints if necessary.  These commitments are expected to be
paid from existing cash balances and the sale of real estate
owned.

The Partnership is continuously evaluating various alternative
strategies for liquidating its real estate assets under current
market conditions.  These alternative strategies include the
potential joint venture and/or build out of certain of the
Partnership's properties in order to increase their marketability
and maximize the return to the limited partners.  In the event
the Partnership decides to implement some of these strategies, it
may require the investment of proceeds received from the payoff
of existing loans and the sale of other real estate assets.  The
decision to invest additional cash in existing assets will only
be made if, based on management's best judgment at the time,
there is a clear indication that such investment should generate
a significantly greater return to the limited partners than any
other strategies available to the Partnership.  During 1995, the
Partnership, through its 50 percent owned corporation, LCR,
entered into a joint venture agreement with Home Devco, Inc.
("Home Devco"), an affiliated entity, entitled Silverwood Homes
("Silverwood").For further information see note 4 of Notes to
Consolidated Financial Statements.

Effective with the third quarter of 1991, the Partnership
suspended cash distributions to partners due to a decline in
liquidity and the uncertainty of the cash requirements for
existing and potential real estate owned.  Pursuant to the
Partnership Agreement, 60 months after the closing of the
offering, cash proceeds from mortgage investments are no longer
available for reinvestment by the Partnership.  Management
believes that current and projected liquidity is sufficient to
fund operating expenses and to meet the contractual obligations
and cash flow operating requirements of the Partnership.
However, the Partnership needs to improve liquidity through the
sale of real estate owned in order to allocate funds to improve
and to fulfill the operating requirements of the remaining real
estate owned by the Partnership on a long-term basis.

RESULTS OF OPERATIONS

Management has noted that the long-term downturn in the real
estate industry in California has not only stabilized, it has
improved considerably in many sectors of the market.  As of March
31, 1998, all of the nonaffiliated loans have been repaid to the
Partnership and the Partnership does not expect to realize any
future interest income on loans to nonaffiliates.  Interest
income on loans to nonaffiliates, including fees was $5,000 and
$4,000 for the three months ended March 31, 1998 and 1997,
respectively.

The outstanding principal balance of loans on nonaccrual at March
31, 1998 and 1997 totaled $724,000 and $1,030,000, respectively.
Loans on "nonaccrual" refers to loans upon which the Partnership
is no longer accruing interest.  Management's policy is to cease
accruing interest on loans when interest and/or principal
repayments become 90 days past due.  Had interest accrued
throughout the first three months of 1998 and 1997 on the
affiliated nonaccrued loans, interest income would have been
approximately $26,000 and $50,000 higher than was actually
reported for those periods.

The real estate owned balance at March 31, 1998 and 1997 was
$8,125,000 and $8,771,000, respectively.

The following sections entitled Nonaccrual Loans and Real Estate
Owned provide a detailed analysis of these assets.

NONACCRUAL LOANS

During 1994, the Partnership converted a 50 percent participation
in a note secured by a second trust deed into a 50 percent
participation in a $2,115,000 unsecured note representing a
workout loan due from LCR, an affiliate.  This loan and an
additional loan funded by Centennial Mortgage Income Fund
("CMIF") reflect the majority of the cost basis of 179
residential lots which LCR contributed to Silverwood.  LCR's only
source of repayment of this note is the excess, if any, of
proceeds from the sale of the fully developed lots over the
amount of secured debt.  Due to the continuing decline in value
of the lots, management does not expect that this loan will be
repaid.  As a result, the loan has been placed on nonaccrual.
The participating principal balance and nonaccrued interest
balances at March 31, 1998 are $1,059,000 and $345,000,
respectively.  As discussed in note 4 of Notes to Consolidated
Financial Statements, the Partnership has reduced the carrying
value of this note by $1,059,000, a portion of its share of
losses from this unconsolidated investee.

During 1994 and 1995, LCR had evaluated various alternative
strategies for liquidating its investment in the 179 lots in
Lancaster.  During 1994, LCR determined that its best course of
action appeared to be the full-scale buildout and sale of single-
family homes since the market for finished lots had fallen so
significantly.  LCR obtained construction financing commitments
from the Partnership and CMIF.  LCR entered into a joint venture
agreement entitled Silverwood with Home Devco to construct and
sell single-family homes at the project.

Silverwood began constructing a model home complex at the project
in June 1995.  Construction commenced in September 1995 on Phase
I at the project.  Construction of Phase II of the project was
commenced in February 1997.  At March 31, 1998, the Partnership
holds a 50 percent participation in three notes due from
Silverwood consisting of a land development loan, a model home
loan and a home construction loan with combined disbursed
balances of $1,155,000.  The Partnership's disbursed balance of
the $3,266,000 development loan at March 31, 1998 was $906,000.
The Partnership's disbursed balance of the $490,000 model loan at
March 31, 1998 was $245,000.  At March 31, 1998, the
Partnership's disbursed balance of the $1,034,000 Phase I
construction loan was $4,000.  As discussed in note 4 of Notes to
Consolidated Financial Statements, the Partnership had reduced
the carrying value of the land development loan by $431,000, the
remainder of its share of losses in unconsolidated investees.

Sales volumes of new homes in the Lancaster area have continued
to remain sluggish since 1995 while sales prices have remained
relatively flat and construction costs have increased.  This has
caused a further decline in the value of finished lots and a
reduction in the anticipated net proceeds the Partnership expects
it might realize from the buildout of homes at the project.
Additionally, Silverwood closed escrow on only two homes during
the twelve calendar months of 1996' seven homes during the twelve
calendar months of 1997, and 3 homes during the three months
ended March 31, 1998, far less than originally anticipated.  As a
result of these factors, LCR recorded a $207,000, $2,516,000 and
$1,077,000 provision for losses on real estate investments during
1997, 1996 and 1995, respectively.  Silverwood has entered into a
purchase and sale agreement to sell the 157 remaining undeveloped
lots and intends to shut down its homebuilding activities.  The
pending transaction requires the Partnership and CMIF to provide
financing to the buyer and is not expected to result in any
significant gain or loss.  There is no assurance that this
transaction will ultimately close escrow.

REAL ESTATE OWNED

A description of the Partnership's principal real estate owned
follows:

Office Building in San Bernardino, California

The Partnership funded a loan during January 1988 with an
original committed amount of $921,000 which was secured by a
second trust deed on an office building comprised of 15,894
square feet of rentable space located in San Bernardino,
California.  The loan was provided as gap financing behind a
first deed of trust in the amount of $350,000 to another
financial institution.  The borrower was unable to payoff the
loan at maturity and the Partnership foreclosed on April 20,
1993.  The Partnership restructured the note secured by the first
trust deed to a more favorable term and rate.  The project is 78
percent leased and generated net operating income before debt
service of $16,000 during the first three months of 1998.  The
property is being marketed for sale, however, due to below
desirable occupancy levels, it is difficult to attract buyers.
The net carrying value at March 31, 1998 was $827,000 before
allowance for possible losses.  The Partnership has recorded a
$250,000 allowance for losses related to this property as of
March 31, 1998.  The property is encumbered by a fully amortizing
note secured by a first trust deed of $85,000 which will be paid
off on December 1, 1999.

45 Acres in Sacramento, California

The Partnership funded a loan in 1987 with a committed amount of
$4,000,000 secured by a first trust deed on 44.52 acres in
Sacramento, California.  The loan was provided for the
development of offsite improvements.  The maturity date was
February 1, 1991.  The borrower was unable to obtain construction
financing and bring interest current.  The Partnership accepted a
grant deed on the property on March 10, 1992.  The property is
zoned for multi-family and light industrial use.  A portion of
the property is adjacent to Highway 99 and has good freeway
visibility.  The Partnership rezoned and subdivided a portion of
the property to facilitate one escrow on a 6.5 acre portion of
the property without freeway visibility.  This escrow closed
during 1997.  During the first quarter of 1998, the Partnership
opened escrow on a 9.5 acre portion of the property.  The
purchase price is $875,000 and the transaction is subject to the
buyer obtaining certain senior housing tax credits through a
governmental lottery.  As a result, there is no assurance that
this transaction will ever be consummated.  At March 31, 1998,
the carrying value before allowance for possible losses was
$3,637,000.  The Partnership has recorded a $701,000 allowance
for losses related to this property as of March 31, 1998.

Proposed Marina and Condominiums in Redwood City, California

On April 7, 1989, the Partnership foreclosed on a land loan
located in Redwood City, California with an original committed
amount of $3,487,000.  The purpose of the loan was to acquire the
land and provide for the planning of a 122-slip marina plus an
office building and restaurant.  The original maturity date of
October 21, 1986 was extended to March 1, 1987.  In March 1987,
the borrower filed bankruptcy.  The property is included in real
estate owned at its carrying value before allowance for possible
losses of $5,360,000.   Management has obtained an extension on
the 404B1 permit for the marina through March 1999.  The 404B1
permit enables the owner to build the currently proposed 104-slip
boat marina.  The Partnership has completed approximately 70
percent of the dredging of the marina site.  The property had
been in escrow since 1996 for a purchase price of $4,000,000.
Numerous issues have arisen during the course of this escrow
which have prevented it from closing.  The most significant of
these issues involves access to the property over a privately
owned road.  The Partnership and the buyer have been working with
officials of Redwood City to complete eminent domain proceedings
on this private road.  Considerable progress has been made
towards a resolution to the access issue and it is possible that
this transaction could close in the second quarter of 1998,
however, there is no assurance that this escrow will ever
actually close.  In order to resolve the access issue, the
Partnership has agreed to reduce the purchase price to $3,900,000
in exchange for the buyer assuming certain future obligations
related to the access issue.  It is possible that the Partnership
may incur substantial additional costs in order to finalize the
transaction.  The Partnership has recorded a $1,751,000 allowance
for losses related to this property as of March 31, 1998.  This
allowance is based upon the assumption that the current
transaction will close escrow and reflects management's estimate
of future costs to resolve the access issue and other costs of
selling the property.  If the access issue is not satisfactorily
resolved, the value of this property would be severely impacted
and the current allowance for possible losses would be
inadequate.

10.66 Acres in Roseville, California

The Partnership funded a loan in 1990 with an original committed
amount of $2,779,000 secured by a second deed of trust on 982
acres in Roseville, California.  The borrower failed to make the
required yearly principal payment to the first and second trust
deed holders.  The first trust deed holder filed a notice of
default for nonpayment.  Management negotiated a settlement
agreement to accept a 10.66 acre commercial site as payment in
full for the $2,779,000 note.  This property had a carrying value
at March 31, 1998 of $1,003,000 and has no additional debt.  The
property is currently in escrow for a purchase price of
$1,200,000 and close of escrow is scheduled for the second
quarter of 1998.  The buyer has only made a $20,000 nonrefundable
deposit against the purchase price.  Accordingly, there can be no
assurance that this transaction will ever be consummated.  The
Partnership has no recorded allowance for losses related to this
property as of March 31, 1998.

INTEREST ON INTEREST-BEARING DEPOSITS

Interest on interest-bearing deposits totaled $2,000 and $2,000
for the three months ended March 31, 1998 and 1997, respectively.
Interest on interest-bearing deposits represents interest earned
on Partnership funds invested, for liquidity, in time certificate
and money market deposits.

INCOME FROM OPERATIONS OF REAL ESTATE OWNED

Income from operations of real estate owned consists of operating
revenues of $38,000 and $32,000 for the three months ended March
31, 1998 and 1997, respectively.  The 1998 and 1997 revenues are
from the office building in San Bernardino.

PROVISION FOR POSSIBLE LOSSES

There was no provision for possible losses for the three months
ended March 31, 1998 or 1997.  The provision for possible losses
results from the change in the allowance for possible losses on
real estate owned net of charge-offs, if any.  Management
believes that the allowance for possible losses at March 31, 1998
is adequate to absorb the known and inherent risk in the
Partnership's loan and real estate owned portfolio.


SHARE OF LOSSES IN UNCONSOLIDATED INVESTEE

The Partnership has invested in a corporation in which it has
less than a majority ownership and accounts for this investment
using the equity method.  The Partnership's share of losses in
this unconsolidated investee was $54,000 and $29,000 for the
three months ended March 31, 1998 and 1997, respectively.  The
share of losses consists primarily of provisions for losses on
real estate investments and interest expense related to the 179
lots in Lancaster owned by LCR.  The increase for 1998 is due to
an increase in interest expense for 1998.

OTHER EXPENSES

Operating expenses from operations of real estate owned were
$19,000 and $18,000 for the three months ended March 31, 1998 and
1997, respectively.  These expenses were associated with the
office building in San Bernardino.

Operating expenses from operations of real estate owned paid to
affiliates were $3,000 and $3,000 for the three months ended
March 31, 1998 and 1997, respectively.  The operating expenses
consist of property management fees paid to an affiliate.

Expenses associated with non-operating real estate owned were
$125,000 and $105,000 for the three months ended March 31, 1998
and 1997, respectively.  The expenses relate to the proposed
marina and condominiums in Redwood City, the 45 acres in
Sacramento, and the 10.66 acres in Roseville.  The increase for
the three months ended March 31, 1998 is primarily due to legal
costs associated with the proposed marina and condominiums in
Redwood City, CA.

Depreciation and amortization expense was $1,000 and $2,000 for
the three months ended March 31, 1998 and 1997, respectively.

Interest expense was $2,000 and $3,000 for the three months ended
March 31, 1998 and 1997, respectively.  The interest expense
relates to the office building in San Bernardino.  The decrease
for 1998 is due to the amortization of the note secured by the
office building in San Bernardino.

General and administrative expenses, affiliates for the three
months ended March 31, 1998 and 1997 totaled $45,000 and $44,000,
respectively.  These expenses are primarily salary allocation
reimbursements paid to affiliates.

General and administrative expenses, nonaffiliates totaled
$14,000 and $13,000 for the three months ended March 31, 1998 and
1997, respectively.  These expenses consist of other costs
associated with the administration of the Partnership and real
estate owned.












































                           PART II

Other Information

Item 1.  Legal Proceedings

         None


Item 2.  Changes in Securities

         None


Item 3.  Defaults Upon Senior Securities

         None


Item 4.  Submission of Matters to a Vote of Security Holders

         None


Item 5.  Other Information

         None


Item 6.  Exhibits and Reports on Form 8-K

         (a)  None

         (b) None
















                        Signatures


Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned
thereunto duly authorized.


CENTENNIAL MORTGAGE INCOME FUND AND SUBSIDIARIES
A California Limited Partnership


By:/s/John B. Joseph
_________________________________
John B. Joseph
General Partner                                      May 15, 1998


By:/s/Ronald R. White
_________________________________
Ronald R. White
General Partner                                      May 15, 1998


By:  CENTENNIAL CORPORATION
     General Partner



/s/Joel H. Miner
_________________________________
Joel H. Miner
Chief Financial Officer                              May 15, 1998