Form 10-Q Quarterly Report
                           --------------------------

                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                For the quarterly period ended September 30, 2000

                                       OR

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

                         Commission File Number: 1-7614
                          -----------------------------

                              PMCC FINANCIAL CORP.
             (Exact Name of Registrant as Specified in its Charter)


          Delaware                                              11-3404072
(State or other Jurisdiction of                              (I.R.S. Employer
Incorporation or Organization)                            Identification Number)


                               1767 Morris Avenue
                                 Union, NJ 07083
              (Address of Principal Executive Offices and Zip Code)

                                 (908) 687-2000
              (Registrant's telephone number, including area code)


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  ________

Number of shares  outstanding of the issuer's  Common Stock,  par value $.01 per
share, as of November 8, 2000: 3,707,000 shares.


<PAGE>
                              PMCC FINANCIAL CORP.

                                    FORM 10-Q

                                TABLE OF CONTENTS
                                -----------------

                                                                         Page No
                                                                         -------

Part I - Financial Information

Item 1.   Financial Statements:

     Consolidated  Statements  of  Operations  (Unaudited)
          Three  Months  Ended September 30, 2000 and 1999                   3
          Nine months ended September 30, 2000 and 1999                      4

     Consolidated Statements of Financial Condition (Unaudited)              5
          September 30, 2000 and December 31, 1999

     Consolidated Statements of Cash Flows (Unaudited)                       6
          Nine months ended September 30, 2000 and 1999

     Notes to Consolidated Financial Statements (Unaudited)                 7-12


Item 2.   Management's Discussion and Analysis of Financial Condition      13-23
          and Results of Operations

Part II -  Other Information                                               24-25

Exhibit Index                                                                25

Signatures                                                                   26

<PAGE>
                         Part I - FINANCIAL INFORMATION

Item 1.  Financial Statements


                      PMCC FINANCIAL CORP. and SUBSIDIARIES
                      Consolidated Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>
<S>                                                                 <C>             <C>
                                                                           Three Months Ended
                                                                           ------------------
                                                                             September 30,
                                                                             -------------
                                                                         2000            1999
                                                                         ----            ----

Revenues:
Sales of residential rehabilitation properties                      $  1,692,348    $ 10,743,477
Gains on sale of mortgage loans, net                                     761,840       3,730,304
Interest earned                                                          232,206       1,301,292
                                                                    ------------    ------------
                                                                       2,686,394      15,775,073
                                                                       ---------      ----------
Expenses:
Costs of sales, residential rehabilitation properties                  1,650,645       9,610,539
Compensation and benefits                                                963,310       3,419,097
Interest expense                                                         464,976       1,291,761
Expenses resulting from Investigation (Note 7)                            86,500            --
Expenses relating to closing Roslyn office                               551,170            --
Other general and administrative                                         819,842       1,439,622
                                                                    ------------    ------------
                                                                       4,536,443      15,761,019
                                                                       ---------      ----------

(Loss) income before income tax expense                               (1,850,049)         14,054
Income tax expense                                                          -              6,000
                                                                    ------------    ------------
                  Net  (loss) income                                $ (1,850,049)   $      8,054
                                                                    ============    ============


Net (loss) income per share of common stock-basic                   $      (0.50)   $      0.002
                                                                    ============    ============

Net (loss) income per share of common stock-diluted                 $      (0.50)  $       0.002
                                                                    ============    ============

Weighted average number of shares and
   share equivalents outstanding-basic                                 3,707,000       3,724,800
                                                                    ============    ============

Weighted average number of shares and
   share equivalents outstanding-diluted                               3,707,000       3,795,046
                                                                    ============    ============
</TABLE>


See accompanying notes to unaudited consolidated financial statements.


<PAGE>
                      PMCC FINANCIAL CORP. and SUBSIDIARIES
                      Consolidated Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>
<S>                                                                       <C>             <C>
                                                                                 Nine months ended
                                                                                 -----------------
                                                                                    September 30,
                                                                                    -------------
                                                                               2000            1999
                                                                               ----            ----
Revenues:
Sales of residential rehabilitation properties                            $ 16,143,462    $ 29,325,884
Gains on sale of mortgage loans, net                                         2,412,274      11,617,022
Loss on sales of delinquent loans                                             (900,000)           --
Interest earned                                                              1,231,358       3,657,636
                                                                          ------------    ------------
                                                                            18,887,094      44,600,542
                                                                            ----------      ----------
Expenses:
Costs of sales, residential rehabilitation properties                       15,838,998      26,565,987
Compensation and benefits                                                    4,313,868       9,023,859
Interest expense                                                             1,537,155       3,490,676
Expenses resulting from Investigation (Note 7)                               1,577,400            --
Expenses relating to closing Roslyn office                                     551,170            --
Other general and administrative                                             2,903,507       3,803,102
                                                                          ------------      ----------
                                                                            26,722,098      42,883,624
                                                                            ----------      ----------

(Loss) income before income tax (benefit) expense                           (7,835,004)      1,716,918
Income tax (benefit) expense                                                (1,161,435)        704,000
                                                                          ------------    ------------
                  Net  (loss) income                                      $ (6,673,569)   $  1,012,918
                                                                          ============    ============


Net (loss) income per share of common stock-basic                         $      (1.80)   $       0.27
                                                                          ============    ============

Net (loss) income per share of common stock-diluted                       $      (1.80)   $       0.27
                                                                          ============    ============

Weighted average number of shares and
   share equivalents outstanding-basic                                       3,707,000       3,724,800
                                                                          ============    ============

Weighted average number of shares and
   share equivalents outstanding-diluted                                     3,707,000       3,764,450
                                                                          ============    ============
</TABLE>


See accompanying notes to unaudited consolidated financial statements.


<PAGE>
                      PMCC FINANCIAL CORP. AND SUBSIDIARIES
                 Consolidated Statements of Financial Condition


<TABLE>
<CAPTION>
<S>                                                                    <C>             <C>
                                                                         Unaudited         Audited
                                                                        September 30,     December 31,
                                                                            2000             1999
                                                                            ----             ----
Assets
Cash and cash equivalents                                              $     51,632    $    214,957
Restricted cash                                                                --           500,000
Mortgage loans held for sale, net                                        16,435,425      36,666,397
Mortgage loans held for investment, net                                     796,209       3,112,179
Receivable from sales of loans                                                 --         4,300,279
Accrued interest and other receivables, net                               2,612,060       1,521,756
Residential rehabilitation properties, net                                1,224,246      15,189,753
Furniture, fixtures & equipment, net                                        746,050       1,169,327
Prepaid expenses and other assets                                           464,451         870,875
                                                                       ------------    ------------

Total assets                                                           $ 22,330,073    $ 63,545,523
                                                                       ============    ============


Liabilities and shareholders' equity
Liabilities:
Notes payable-principally warehouse lines of credit                    $ 16,374,249    $ 50,584,370
Deferred income taxes                                                          --           333,000
Accrued expenses and other liabilities                                    1,429,173       1,531,374
                                                                       ------------    ------------

Total liabilities                                                        17,803,422      52,448,744
                                                                       ------------    ------------

Shareholders' equity
Common stock                                                                 37,500          37,500
Additional paid-in capital                                               11,020,724      10,917,283
Retained (deficit) earnings                                              (6,277,102)        396,467
Treasury stock                                                             (254,471)       (254,471)
                                                                       ------------    ------------
Total shareholders' equity                                                4,526,651      11,096,779
                                                                       ------------    ------------

Total liabilities and shareholders' equity                             $ 22,330,073    $ 63,545,523
                                                                       ============    ============
</TABLE>


See accompanying notes to unaudited consolidated financial statements.


<PAGE>
                      PMCC FINANCIAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
<S>                                                                               <C>              <C>
                                                                                          Nine months ended
                                                                                          -----------------
                                                                                             September 30,
                                                                                             -------------
                                                                                        2000             1999
                                                                                        ----             ----
Cash flows from operating activities:
Net (loss) income                                                                  $ (6,673,569)   $  1,012,918
    Adjustments to reconcile net (loss) income to net cash provided by
    operating activities:
         Residential rehabilitation properties (exclusive of cash paid
          directly to/by independent contractors):
                    Contractual fees received                                          (304,464)     (2,759,897)
                    Proceeds from sales of properties                                16,143,462      29,325,884
                    Costs of properties acquired                                     (1,873,491)    (24,795,404)
                    Depreciation and amortization                                       275,822         196,894
         Increase in interest and other receivables                                  (1,090,304)     (1,341,883)
                    Decrease in mortgage loans held for sale and
                      investment, net                                                22,546,942      11,361,570
                    Decrease in receivable from sales of loans                        4,300,279      13,110,096
         Decrease (increase) in prepaid expenses and other assets                       406,424        (264,140)
         Decrease in deferred taxes payable                                            (333,000)     (1,187,998)
                  (Decrease) increase in accrued expenses and other                    (102,201)        363,353
                  liabilities                                                          --------         -------

                  Net cash provided by operating activities                          33,295,900      25,021,393
                                                                                     ----------      ----------

Cash flows from investing activities:
          Acquisition of assets of Prime Mortgage Corp.                                    --          (250,000)
                  Disposition of furniture and equipment                                264,146            --
                  Purchase of furniture and equipment                                   (63,250)       (225,938)
                                                                                        -------        --------
Net cash provided by (used in) investing activities                                     200,896        (475,938)
                                                                                        -------        --------

Cash flows from financing activities:
         Net decrease in notes payable-warehouse lines of credit                    (34,210,121)    (27,213,394)
         Net decrease in restricted cash                                                500,000            --
         Issuance of warrants                                                            50,000            --
         Distributions to S corporation shareholders                                       --          (277,700)
                                                                                     ----------        --------

Net cash used in financing activities                                               (33,660,121)    (27,491,094)
                                                                                    -----------     -----------

Net increase (decrease) in cash and cash equivalents                                   (163,325)     (2,945,639)

Cash and cash equivalents at beginning of period                                        214,957       3,596,002
                                                                                    ------------    ------------

Cash and cash equivalents at end of period                                         $     51,632    $    650,363
                                                                                   ============    ============

Supplemental disclosures of cash flow information:
                    Cash paid during the period for:
                    Interest                                                       $  2,179,570    $  3,487,515
                                                                                   ============    ============
                    Income taxes                                                   $     11,190    $    504,647
                                                                                   ============    ============
          Loans transferred from mortgage loans held for sale to held for
            Investment, net                                                        $    470,100    $  2,822,762
                                                                                   ============    ============
</TABLE>


See accompanying notes to unaudited consolidated financial statements.


<PAGE>
                      PMCC FINANCIAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               September 30, 2000
                                   (Unaudited)

1.   Basis of Presentation

          The  unaudited   consolidated  financial  statements  included  herein
     reflect all adjustments,  which are, in the opinion of management necessary
     for a fair  presentation  of the  Company's  financial  condition as of the
     dates  indicated and the results of operations for the periods  shown.  All
     such  adjustments  are of a  normal  recurring  nature.  In  preparing  the
     accompanying  consolidated financial statements,  management is required to
     make estimates and assumptions  that reflect the reported amounts of assets
     and liabilities as of the date of the consolidated  statements of financial
     condition  and of income and  expenses  for the  periods  presented  in the
     consolidated  statements of  operations.  The results of operations for the
     three  and  nine  months  ended  September  30,  2000  are not  necessarily
     indicative of the results of operations to be expected for the remainder of
     the year.  Certain  information and note disclosures  normally  included in
     financial   statements  prepared  in  accordance  with  generally  accepted
     accounting  principles have been omitted  pursuant to rules and regulations
     of the Securities and Exchange Commission.

          These unaudited  consolidated  financial  statements should be read in
     conjunction with the audited  consolidated  financial  statements and notes
     thereto included in the Company's Form 10-K for the year ended December 31,
     1999.

          Certain reclassifications have been made to conform the prior period's
     presentation to the current presentation.

2.   Initial Public Offering

          On  February  18,  1998 the  shareholders  of Premier  Mortgage  Corp.
     ("Premier")  exchanged all of their outstanding  shares of common stock for
     2.5 million shares of the Company.  Following  this  exchange,  the Company
     completed an initial  public  offering of 1.25 million new shares of common
     stock at a price of $9 per share.  The Company  received  gross proceeds of
     $11.25 million and net proceeds of approximately $9.2 million.

          At the  time  of the  exchange,  the  Company  agreed  to  make a cash
     distribution  to its existing  shareholders of $2.7 million which was equal
     to a  portion  of  the  Company's  undistributed  S  corporation  earnings.
     Approximately $1.9 million of this distribution was paid during the quarter
     ended  March 31,  1999 of which $1  million  was from the  proceeds  of the
     initial  public  offering.  The  balance  of the  distribution  was paid in
     installments,  including  interest on the undistributed  balance at 10% per
     annum, through February 18, 1999. The remaining undistributed  subchapter S
     corporation  earnings of approximately  $1.0 million were reclassified from
     retained earnings to additional paid in capital.

3.   Income Taxes

          The Company  accounts for income taxes under the  liability  method as
     required by SFAS No. 109.

4.   Earnings Per Share of Common Stock

          Basic EPS is  determined  by dividing net income for the period by the
     weighted  average  number  of common  shares  outstanding  during  the same
     period.  Diluted EPS reflects the  potential  dilution  that could occur if
     securities  or other  contracts  to issue  common  stock were  exercised or
     converted  into common  stock or resulted in the  issuance of common  stock
     which  would then share in the  earnings  of the  Company.  The  additional
     number of shares  included in the  calculation  of diluted EPS arising from
     issued stock  options and  warrants was 70,246  shares for the three months
     ended  September  30,  1999 and  39,650  shares for the nine  months  ended
     September  30,  1999.  There was no dilution for either the three months or
     nine months ended September 30, 2000.

5.   Notes Payable

          At  September  30, 2000 and 1999,  substantially  all of the  mortgage
     loans  held for sale and  investment,  receivable  from  sales of loans and
     certain residential  rehabilitation properties were pledged to secure notes
     payable under warehouse lines of credit agreements. The notes are repaid as
     the related  mortgage  loans or residential  rehabilitation  properties are
     sold or collected.

          On February 28,  2000,  the Company  entered into a Master  Repurchase
     Agreement  that provides the Company with a warehouse  facility (the "IMPAC
     Line")  through IMPAC  Warehouse  Lending Group  ("IMPAC").  The IMPAC Line
     provides  a  committed  warehouse  line of  credit of $20  million  for the
     Company's  mortgage  originations  only.  The IMPAC  Line is secured by the
     mortgage  loans  funded  with the  proceeds  of such  borrowings.  Interest
     payable is  variable  based on the Prime Rate as posted by Bank of America,
     N.A.  plus  0.50%.  The  IMPAC  Line has no stated  expiration  date but is
     terminable by either party upon written notice.

          The Company's  warehouse lines of credit with Bank United and GMAC/RFC
     were both paid in full in June 2000. The expiration dates for the Company's
     warehouse  line of credit  with Chase Bank of Texas,  National  Association
     ("Chase")  and PNC Bank  ("PNC")  is in the  process of being  extended  to
     December  15,  2000.  The  Company   anticipates  paying  down  the  entire
     facilities or renewing the extensions under similar terms and conditions as
     the extensions which have previously been granted. The total outstanding on
     this line at November 9, 2000 is approximately $489,000.

6.   Related-Party Transactions

          On  June  8,  2000,  the  Company  borrowed  $275,000  from a  company
     wholly-owned by Robert Friedman,  owner of 17% of the Company's outstanding
     stock and the father of Ronald Friedman, the Company's former President and
     CEO  currently a  consultant  to the  Company.  This loan is evidenced by a
     promissory  note due and payable in one year. The interest rate on the note
     is 16% per annum payable  monthly.  The note is secured by properties and a
     mortgage which the Company owns.  Under the same note, the Company borrowed
     an additional  $50,000 in July 2000.  The Company  repaid $80,000 in August
     2000  and  $175,000  in  October  2000  when a  portion  of the  underlying
     collateral was sold by the Company. The balance due on the note at November
     8, 2000 is $70,000.

          A relative  of Ronald  Friedman  has an  economic  interest in a rehab
     partner  for the  purchase  and sale of  rehabilitation  properties  with a
     subsidiary  of  PMCC.  At  September  30,  2000,  the  subsidiary  owned no
     remaining properties.

7.   Litigation

          The U.S. Attorney's Office for the Eastern District of New York ("U.S.
     Attorney") is conducting an investigation  (the  "Investigation")  into the
     allegations  asserted in a criminal complaint against Ronald Friedman,  the
     former Chairman of the Board,  President and Chief Executive Officer of the
     Company,  and a loan officer formerly employed by the Company.  On December
     21,  1999,  agents of the Office of the  Inspector  General  for the United
     States Department of Housing and Urban Development  ("HUD") executed search
     and arrest warrants at the Roslyn offices of the Company. The warrants were
     issued on the basis of a federal criminal  complaint  ("Complaint"),  which
     charged  that  Ronald   Friedman  and  the  loan  officer   knowingly   and
     intentionally  made,  uttered or published  false  statements in connection
     with loans to be insured by HUD.

          In response to the allegations  against the loan officer and Friedman,
     the Company  engaged the legal  services of Dorsey & Whitney LLP to conduct
     an  internal  investigation  into the alleged  misconduct  and to prepare a
     report  discussing the findings of the internal  investigation.  As part of
     this internal investigation,  the Company worked closely and in cooperation
     with HUD and the U.S. Attorney. In addition, key employees,  including loan
     officers, loan processors,  underwriters and managers, were interviewed. An
     audit also was conducted by Dorsey & Whitney of over  one-third of all 1999
     FHA  loans in order to assess  whether  the  files  comported  with the HUD
     guidelines for FHA loans.

          A preliminary  report detailing Dorsey & Whitney's  investigation  and
     findings  was  presented to the  Company's  Board of Directors on April 12,
     2000. A written report was issued on April 14, 2000.  The report  concludes
     that while there appears to be support for the  allegations  leveled at the
     former loan officer,  there is no evidence that the  misconduct  alleged in
     the complaint was systemic at the Company. Rather, the findings support the
     conclusion that the alleged misconduct was an isolated  occurrence,  not an
     institutional  practice.  The  available  evidence did not permit  Dorsey &
     Whitney to reach a definitive  conclusion  concerning  the charges  pending
     against Ronald Friedman.  The  investigation,  comprised of interviews with
     PMCC employees and an extensive review of mortgage loan files,  revealed no
     independent  evidence  tending to support the allegations  against Friedman
     contained in the criminal complaint.

          While the Company  believes that it has not committed any  wrongdoing,
     it continues to cooperate  fully with the U.S.  Attorney's  Office and HUD.
     However,  it  cannot  predict  the  duration  of the  Investigation  or its
     potential  outcome.  Although the Company does not anticipate being charged
     in connection  with this  investigation,  in the event that the Company was
     charged,  it intends to vigorously  defend its position.  While the Company
     does not  anticipate its  occurrence,  in the event that it was to lose its
     ability to originate and sell FHA loans as result of the Investigation, the
     Company does not believe that the financial  effect on the Company would be
     material.  The Company  originates  less than 5% of its current loan volume
     through FHA products.

          As a result of this investigation, the Company incurred $1.577 million
     and $87,000 of direct  expenses  for the nine months and three months ended
     September  30,  2000,  respectively.   These  expenses  include  legal  and
     professional fees incurred in connection with the internal investigation of
     the Company, criminal defense attorneys and negotiations of warehouse lines
     of  credit  amendments.  Also  included  in these  expenses  are bank  fees
     relating  to  granting  amendments  to the Bank  United  line of credit and
     bonuses paid to the Company's officers and employees.

8.   Change of Control

          Effective July 28, 2000, PMCC Financial Corp.  announced that Internet
     Business's International,  Inc. ("IBUI") is purchasing the 2,460,000 shares
     of the Registrant held by Ronald  Friedman,  Robert Friedman and the Ronald
     Friedman  1997  Guarantor   Retained  Annuity  Trust   (collectively,   the
     "Sellers")  in a private  transaction  (the  "Transaction").  This purchase
     represents 66.36% of the 3,707,000 shares of common stock of the Registrant
     outstanding.  IBUI  is  a  holding  company  with  a  variety  of  Internet
     subsidiaries  that  trades  publicly  under the  symbol  IBUI on the NASDAQ
     Bulletin Board. The aggregate purchase price of $3,198,000 is to be paid in
     cash to the  Sellers by IBUI as follows  over a period of nine  months from
     the date of closing.

          In the event that three months after closing,  the Registrant's common
     stock is not  trading on either the  American  Stock  Exchange  ("AMEX") or
     NASDAQ,  the  purchase  price  shall be  reduced by the amount of the Final
     Payments,  which payments will no longer be due and payable.  In the event,
     however, that AMEX or NASDAQ initiates trading in months three through five
     subsequent to closing,  and IBUI merges the Registrant  with IBUI or any of
     its affiliates, the purchase price will not be reduced.

          At the  closing,  all shares  purchased  by IBUI from the Sellers were
     deposited in escrow with the Sellers'  attorney.  These shares are released
     to IBUI upon  receipt of the  scheduled  installment  payments.  If IBUI is
     relieved  from  making  the  Final  Payment,  then  the  Eighth  and  Ninth
     installment  shares  will be  released  from  escrow on the 210th day after
     closing.

          Simultaneous  with the  Transaction,  the Company's Board of Directors
     passed a  resolution  to amend the  Company's  By-laws  to  provide  for an
     increase in the number of directors from four to seven. Keith Haffner,  the
     Company's  Executive  Vice President and Interim Chief  Executive  Officer,
     resigned from the Board. Albert Reda, IBUI's Chief Executive Officer, Louis
     Cherry,  IBUI's  President  and David  Flyer,  a consultant  to IBUI,  were
     elected to the Company's Board. The seventh Board member,  Carl Carstensen,
     President IBM Solutions,  European Divisions,  will be elected to the Board
     effective at the earliest time such election is permitted  pursuant to Rule
     14f-1 of the Rules and  Regulations  under the  Securities  Exchange Act of
     1934.

9.   American Stock Exchange

          On  September  22,  2000,  PMCC  Financial  Corp.  was  advised by the
     American Stock Exchange that it is the intention of the Exchange to proceed
     with  the  filing  of an  application  with  the  Securities  and  Exchange
     Commission  to  strike  the   Company's   common  stock  from  listing  and
     registration on the Exchange. Under Section 1003 (f)(iii) of the Exchange's
     Company Guide,  the Exchange may at any time remove a security from listing
     if the company or its management  shall engage in operations  which, in the
     opinion of the Exchange,  are contrary to the public  interest.  Citing the
     previously announced criminal complaint (the "Complaint") and investigation
     by the U.S.  Attorney (the  "Investigation")  which have not been resolved,
     the Exchange  believes that the nature and extent of the allegations of the
     Complaint,  the  related  Investigation  and  Ronald  Friedman's  continued
     association  with  the  Company  as a  consultant  hired  by the  Board  of
     Directors raise significant public interest concerns.  The Exchange further
     expressed  concern over the proposed  transaction with IBUI and the lack of
     information concerning the eligibility for listing of the combined entity.

          The Company has appealed the decision by the AMEX and has met with the
     Exchange's  Committee on Securities on November 6, 2000. The results of the
     appeal are not known at this time.

10.  Subsequent Events

          In light of the  decision  pending  appeal by the AMEX to de-list  the
     trading of the  Company's  common  stock,  certain  payments  due under the
     agreement  by IBUI to purchase  shares of the  Company's  stock from Ronald
     Friedman,  Robert Friedman and the Ronald Friedman 1997 Guarantor  Retained
     Annuity  Trust were not made.  The Company has been informed by the Sellers
     that an event of default has been declared against IBUI under this purchase
     agreement.  At this time, a definitive letter agreement has been reached by
     all  parties  involved  in the  Transaction  that will cure the default and
     change  certain  terms of the  purchase  including  the price and manner of
     payment.  A formal  agreement  is expected  to be signed  within a two-week
     period.

          Additionally,  merger talks have resumed  between the Company and IBUI
     whereby IBUI will propose to purchase the remaining  outstanding  shares of
     PMCC in exchange for IBUI stock. No agreements have been reached,  however,
     a letter of intent is expected  to be agreed upon within  before the end of
     2000. Such a merger would increase the Company's capital base,  improve the
     combined  balance sheet and allow the Company to seek additional  warehouse
     lines of credit,  raise additional  capital or issue debt  securities.  The
     Transaction and resultant merger, or a similar agreement,  are necessary in
     order to ensure the ongoing viability of the Company.

11.  Supplemental Information

          The  Company's  operations  consist of two  principal  activities  (a)
     mortgage banking and (b) funding the purchase, rehabilitation and resale of
     residential real estate. The following table sets forth certain information
     concerning these activities (in thousands):

                                                                 (Unaudited)
                                                               Nine months ended
                                                               -----------------
                                                                 September 30,
                                                                 -------------
                                                              2000         1999
                                                             ------        ----
     Revenues:
        Residential rehabilitation properties               $16,143     $ 29,326
        Mortgage banking                                      2,744       15,275
                                                            ---------     ------
                                                            $18,887      $44,601
                                                            =======      =======
     Less: (1)
        Expenses allocable to residential rehabil-
          itation properties (cost of sales, interest
          expense and compensation and benefits)             17,037       28,417
        Expenses allocable to mortgage banking
          (all other)                                         9,685       14,467
                                                            -------     --------
                                                            $26,722      $42,884
                                                            =======      =======

         Operating (Loss) Profit:
              Residential rehabilitation properties            (894)         909
              Mortgage banking                               (6,941)         808
                                                            -------     --------
                                                            $(7,835)    $  1,717
                                                            =======     ========

         Identifiable Assets (at September 30, 2000 and
           December  31,  1999, respectively):
              Residential rehabilitation properties         $  1,794   $  15,190
              Mortgage banking                                20,536      48,356
                                                            --------   ---------
                                                             $22,330   $  63,546
                                                             =======   =========

(1) In managing its business,  the Company does not allocate  corporate expenses
other than interest and compensation and benefits to its various activities.


<PAGE>
Item 2. Management's  Discussion and Analysis of Financial Condition and Results
of Operations

Forward-Looking Statements

     The  Private  Securities  Litigation  Reform  Act of 1995  provides a "safe
harbor" for certain  forward-looking  statements.  This Quarterly Report on Form
10-Q may contain forward-looking  statements which reflect the Company's current
views  with  respect  to  future   events  and  financial   performance.   These
forward-looking  statements  are  subject  to certain  risks and  uncertainties,
including  those  identified  below,  which could cause actual results to differ
materially from historical results or those anticipated.  These  forward-looking
statements reflect the Company's current views with respect to future events and
financial performance.  The words "believe," "expect,"  "anticipate,"  "intend,"
"estimate,"  and other  expressions  which  indicate  future  events  and trends
identify  forward-looking  statements.  Readers are cautioned not to place undue
reliance  upon these  forward-looking  statements,  which speak only as of their
dates.  The Company  undertakes no  obligation to publicly  update or revise any
forward-looking  statements,  whether as the result of new  information,  future
events or  otherwise.  The following  factors  among others,  could cause actual
results to differ materially from historical results or those  anticipated:  (1)
the level of demand for  mortgage  credit,  which is affected  by such  external
factors as the level of interest rates,  the strength of various segments of the
economy and demographics of the Company's lending markets;  (2) the direction of
interest rates; (3) the relationship between mortgage interest rates and cost of
funds;  (4) federal  and state  regulation  of the  Company's  mortgage  banking
operations;  (5)  competition  within the  mortgage  banking  industry;  (6) the
Company's  management  of cash  flow and  efforts  to modify  its  prior  growth
strategy;  (7) the  outcome  of  governmental  investigations  and  the  effects
thereof;  (8) the Company's efforts to improve quality control;  and other risks
and  uncertainties  described in the Company's Annual Report on Form 10-K and in
PMCC   Financial   Corp.'s  other  filings  with  the  Securities  and  Exchange
Commission.  Should one or more of these risks or uncertainties materialize,  or
should underlying  assumptions  prove incorrect,  actual outcomes and events may
vary materially from those indicated.

Results of Operations

Quarter Ended September 30, 2000 Compared to Quarter Ended September 30, 1999

General

Due to recent developments regarding the Investigation referred to in "Part II -
Item 1. Legal  Proceedings"  (which recent  developments  were described in more
detail in the Company's Form 10-K for the year ended  December 31, 1999),  along
with a  continuing  significant  reduction in the  mortgage  origination  market
(particularly  in the  Northeast)  caused  by  increasing  interest  rates and a
fall-off  in  mortgage   refinancing,   the  Company   continued  to  experience
significant  losses for the three months ended September 30, 2000. The following
actions were taken:

     o    In a continuing  effort to reduce the Company's  overhead and expenses
          and  achieve  profitability,  PMCC  Mortgage  Corp.  at its  Board  of
          Directors  meeting on September 18, 2000 determined that on October 1,
          2000,  the  Company  would  permanently  close  its  office  in Roslyn
          Heights,  NY.  PMCC  Mortgage  Corp.  and  PMCC  Financial  Corp.  has
          relocated  their  corporate  offices to the  location of the  existing
          branch  office  and former  corporate  office at 1767  Morris  Avenue,
          Union,  NJ 07083.  In conjunction  with this closing,  the Company has
          negotiated  with its landlord at 3 Expressway  Plaza to terminate  the
          remaining  4.5 years of its lease at that  location.  This  settlement
          includes  the  issuance of 200,000  warrants  to purchase  PMCC Common
          Stock at a price to be  determined  at such time the  Company's  stock
          actively  begins  trading.  Certain  post-closing  and  administrative
          functions  are  being  absorbed  by  the  existing  personnel  in  the
          Company's New Jersey and Florida  locations.  The cost for terminating
          employees and the lease in Roslyn is  approximately  $550,000 which is
          included in the third quarter  financials.  After all reductions noted
          herein, it is anticipated that the Company will experience  annualized
          cost savings of  approximately  $1.5  million.  The  Company's  Roslyn
          retail office and  administrative  offices had previously been reduced
          in January 2000 from 86 employees to 45 and again in June 2000 to 17.

          To  maintain a presence in New York  State,  the Company is  occupying
          office space of approximately  1,000 square feet in Rockville  Centre,
          Long Island.

     o    The Company continued its initiative to sell the completed residential
          rehabilitation properties on hand as quickly as practicable.

     At the same  time the  above  actions  are  being  taken,  PMCC's  business
strategy is to stabilize and  strengthen  its remaining  areas of business.  The
Company has added new account  executives in both New Jersey and Florida.  It is
anticipated  that  more  than 80% of  mortgage  loan  applications  taken by the
Company in 2000 will be as a result of its wholesale operations.

Revenues.  The  following  table  sets  forth the  components  of the  Company's
revenues for the periods indicated:

                                                   Quarters Ended September 30,
                                                   ----------------------------
                                                       2000              1999
                                                       ----              ----

Sales of residential rehabilitation properties     $ 1,692,348       $10,743,477
Gains of sales of mortgage loans, net                  761,840         3,730,304
Interest earned                                        232,206         1,301,292
                                                  ------------      ------------
Total revenues                                    $  2,686,394       $15,775,073
                                                  ============       ===========

     Revenues from the sale of residential  rehabilitation  properties decreased
$9.0 million,  or 84%, to $1.7 million for the quarter ended  September 30, 2000
from $10.7  million for the quarter  ended  September  30,  1999.  The number of
residential  rehabilitation  properties  sold  was  13  for  the  quarter  ended
September 30, 2000 compared to 62 for the quarter ended September 30, 1999. This
decrease was a result of the  Company's  discontinuance  of the  acquisition  of
residential rehabilitation.

     Gains on  sales of  mortgage  loans  decreased  $2.9  million,  or 78%,  to
$762,000  for the quarter  ended  September  30, 2000 from $3.7  million for the
quarter  ended  September  30,  1999.  This  decrease  was  due to a  number  of
significant  factors.  Mortgage loan  originations were $49.4 million and $166.7
million for the quarters ended September 30, 2000 and 1999,  respectively.  This
70%  decrease  was  primarily  the  result of a decline  in retail  originations
arising  from the decrease in the number of retail loan  officers,  along with a
significant  reduction in the mortgage  origination market  (particularly in the
Northeast)  caused by  increasing  interest  rates and a  fall-off  in  mortgage
refinancing.  For the quarter ended September 30, 2000, approximately 20% of the
Company's mortgage originations were derived from its retail mortgage operations
and approximately 80% from its wholesale operations,  compared to 53% retail and
47% wholesale for the three months ended  September  30, 1999.  Wholesale  loans
result in lower  revenues  due to broker  fees  paid of  approximately  1% being
deducted  directly from the gain on sale,  whereas retail loan  commissions  are
shown on the statement of  operations as expenses.  Costs per loan for wholesale
loans are generally lower overall than retail.  Replacing the retail loan volume
with  wholesale   loans  reduced  gains  by   approximately   $200,000  for  the
three-months  ended  September  30,  2000  compared  to the  three-months  ended
September  30,  1999.  In 1999,  the Company  was able to  optimize  the margins
received on the sales of loans by hedging  positions in future sales of Mortgage
Backed  Securities.  This  activity  was  halted  due to the  Investigation  and
subsequent  suspension of trading of the Company's  stock. For the quarter ended
September 30, 2000,  this resulted in  approximately a 0.75% loss in revenue per
loan or $370,000 in total compared to the three-months ended September 30, 1999.
Additionally, in past years, sub-prime loans were generally sold at a higher per
loan margin than conventional loans.  Discontinuing  sub-prime loan originations
reduced gains by approximately $200,000 for the three-months ended September 30,
2000 compared to the three-months ended September 30, 1999.

     The following  table  summarizes the Company's  mortgage  originations  (in
millions):

                                                    Quarters Ended September 30,
                                                    ----------------------------
                                                         2000           1999
                                                         ----           ----
           Conventional                                $49,030        $119,129
           FHA/VA                                          406          45,598
           Subprime                                        -             2,148
                                                       -------        --------
           Total                                       $49,436        $166,875
                                                       ========       ========

     Although there can be no assurance  thereof,  the Company expects  mortgage
originations  to increase and therefore  believes its gains on sales of mortgage
loans will increase.

     Interest earned decreased $1.1 million, or 85%, to $232,000 for the quarter
ended  September 30, 2000 from $1.3 million for the quarter ended  September 30,
1999. This decrease was primarily due to decreased mortgage originations for the
quarter ended  September 30, 2000 as compared to the quarter ended September 30,
1999 and a decrease  in the amount of time a loan is held  before  being sold to
the final  investor.  This more rapid  turnover  allows the Company to utilize a
lower warehouse line.

Expenses.  The following table sets forth the Company's expenses for the periods
indicated:

                                                    Quarters Ended September 30,
                                                    ----------------------------
                                                         2000          1999
                                                         ----          ----

Cost of sales-residential rehabilitation properties   $ 1,650,645  $ 9,610,539
Compensation and benefits                                 963,310    3,419,097
Interest expense                                          464,976    1,291,761
Expenses resulting from Investigation                      86,500       -
Expenses relating to closing Roslyn office                551,170       -
Other general and administrative                          819,842    1,439,622
                                                      -----------  -----------
Total expenses                                        $ 4,536,443  $15,761,019
                                                      ===========  ===========


     Cost of  sales  -  residential  rehabilitation  properties  decreased  $7.9
million,  or 82%, to $1.7 million for the quarter ended  September 30, 2000 from
$9.6 million for the quarter  ended  September  30, 1999.  This decrease was the
result of the  decrease in the number of  properties  sold in the quarter  ended
September 30, 2000 compared to the quarter ended September 30, 1999.

     Compensation and benefits  decreased $2.5 million,  or 74%, to $963,000 for
the quarter  ended  September  30, 2000 from $3.4 million for the quarter  ended
September  30,1999.  This decrease was primarily due to decreased sales salaries
and commissions,  which are based  substantially on mortgage loan  originations,
and the  reductions in staff at the Company's  Roslyn and New Jersey  locations.
Total  personnel  decreased to 40  employees  at September  30, 2000 from 172 at
September 30, 1999.

     Interest expense  decreased  $827,000,  or 64%, to $465,000 for the quarter
ended  September 30, 2000 from $1.3 million for the quarter ended  September 30,
1999.  This  decrease  was  primarily  attributable  to the decrease in mortgage
originations  and a decrease in the amount of time a loan is held  before  being
sold to the final investor along with the decrease in residential rehabilitation
properties funded through the Company's warehouse facility.

     As a result of the  Investigation,  the Company incurred direct expenses of
$87,000 for the  three-month  period ended  September 30, 2000.  These  expenses
primarily  include  legal fees  incurred by the Company in  connection  with its
criminal defense attorneys.

     Expenses  relating to closing the Roslyn  office  include  termination  and
broker  costs for the  settlement  with the  landlord  to  terminate  the lease,
writeoffs of leasehold  improvements  and  capitalized  costs in relation to the
office space, losses on sales of furniture and equipment and severance costs for
terminated employees.

     Other general and administrative  expenses decreased  $620,000,  or 43%, to
$820,000  for the quarter  ended  September  30, 2000 from $1.4  million for the
quarter ended  September 30, 1999.  This decrease was primarily due to decreased
expenses in connection  with the  contraction  in the operations of the Company,
partly offset by increases  incurred in connection with the expansion in Florida
from the Prime acquisition, including rent and facilities expense, telephone and
marketing.

     The Company believes that, as a result of certain cost cutting  initiatives
and  contraction  of business  expansion  in the first  three  quarters of 2000,
expenses will decrease.

     The net loss of $1.850 million for the quarter ended September 30, 2000 was
a decrease of $1.858 million from the net income of $8,000 for the quarter ended
September 30, 1999.


Nine months ended September 30, 2000 Compared to Nine months ended September 30,
1999

General

Due to developments  regarding the Investigation  referred to in "Part II - Item
1. Legal Proceedings"  (which recent  developments were described in more detail
in the Company's Form 10-K for the year ended  December 31, 1999),  along with a
significant  reduction in the mortgage  origination market  (particularly in the
Northeast)  caused by  increasing  interest  rates and a  fall-off  in  mortgage
refinancing,  many of the Company's growth  initiatives were suspended or closed
down  completely  in the nine months ended  September  30, 2000.  The  following
actions were taken:

     o    In a continuing  effort to reduce the Company's  overhead and expenses
          and  achieve  profitability,  PMCC  Mortgage  Corp.  at its  Board  of
          Directors  meeting on September 18, 2000 determined that on October 1,
          2000,  the  Company  would  permanently  close  its  office  in Roslyn
          Heights,  NY.  PMCC  Mortgage  Corp.  and  PMCC  Financial  Corp.  has
          relocated  their  corporate  offices to the  location of the  existing
          branch  office  and former  corporate  office at 1767  Morris  Avenue,
          Union,  NJ 07083.  In conjunction  with this closing,  the Company has
          negotiated  with its landlord at 3 Expressway  Plaza to terminate  the
          remaining   4.5  years  of  its  lease  at  that   location.   Certain
          post-closing  and  administrative  functions are being absorbed by the
          existing  personnel in the Company's New Jersey and Florida locations.
          The  cost  for  terminating  employees  and the  lease  in  Roslyn  is
          approximately   $550,000  which  is  included  in  the  third  quarter
          financials.  After all reductions noted herein, it is anticipated that
          the Company will experience  annualized cost savings of  approximately
          $1.5 million.  The Company's  Roslyn retail office and  administrative
          offices had previously  been reduced in January 2000 from 86 employees
          to 45 and again in June 2000 to 17.

     o    All retail  branches  opened  during 1998 and 1999 were closed,  along
          with one wholesale  office  acquired from Prime,  resulting in a staff
          reduction of 36 employees.  This included retail branches in potential
          high growth areas such as Las Vegas, Phoenix and Deerfield Beach which
          were in  start-up  situations  and were  incurring  high  expenses  in
          relation to their current origination volume.

     o    Staffing at the Company's New Jersey and remaining  Florida  wholesale
          locations  was reduced  from 61 employees to 38 in January 2000 and to
          36 in  September  2000.  The  Florida  locations  have  moved  to more
          cost-efficient office locations.

     o    The Company's  web-site was temporary  closed down as was the Internet
          call  center  in  Houston.  As a  start-up  operation,  this  area was
          incurring high expenses in relation to the current origination volume.

     o    The  Company   temporarily   halted  the  acquisition  of  residential
          rehabilitation   properties  and  began  an  initiative  to  sell  the
          completed properties on hand as quickly as practicable.

     At the same  time the  above  actions  are  being  taken,  PMCC's  business
strategy is to stabilize and  strengthen  its remaining  areas of business.  The
Company has added new account  executives in both New Jersey and Florida.  It is
anticipated  that  more  than 80% of  mortgage  loan  applications  taken by the
Company in 2000 will be as a result of its wholesale operations.

Revenues.  The  following  table  sets  forth the  components  of the  Company's
revenues for the periods indicated:

                                                 Nine months ended September 30,
                                                 ------------------------------
                                                       2000           1999
                                                       ----           ----

Sales of residential rehabilitation properties     $16,143,462     $29,325,884
Gains of sales of mortgage loans, net                2,412,274      11,617,022
Loss on sale of delinquent loans                      (900,000)           -
Interest earned                                      1,231,358       3,657,636
                                                    ----------     -----------
Total revenues                                     $18,887,094     $44,600,542
                                                   ===========     ===========

     Revenues from the sale of residential  rehabilitation  properties decreased
$13.2 million,  or 45%, to $16.1 million for the nine months ended September 30,
2000 from $29.3 million for the nine months ended September 30, 1999. The number
of residential  rehabilitation properties sold was 116 for the nine months ended
September 30, 2000 compared to 178 for the nine months ended September 30, 1999.
This decrease was a result of the Company's discontinuance of the acquisition of
residential  rehabilitation  properties  partly offset by the initiative to sell
the completed  properties on hand as quickly as  practicable.  Additionally,  on
certain properties sold, a discount was given from the original contract pricing
in order to expedite the sale due to cash requirements.

     Gains on sales of mortgage loans  decreased  $9.2 million,  or 79%, to $2.4
million for the nine months ended  September 30, 2000 from $11.6 million for the
nine months  ended  September  30,  1999.  This  decrease was due to a number of
significant  factors.  Mortgage loan originations were $158.3 million and $449.2
million for the nine months  ended  September  30, 2000 and 1999,  respectively.
This 65% decrease was primarily  the result of a decline in retail  originations
arising  from the decrease in the number of retail loan  officers,  along with a
significant  reduction in the mortgage  origination market  (particularly in the
Northeast)  caused by  increasing  interest  rates and a  fall-off  in  mortgage
refinancing.  For the nine months ended September 30, 2000, approximately 30% of
the  Company's  mortgage  originations  were  derived  from its retail  mortgage
operations and approximately 70% from its wholesale operations,  compared to 56%
retail and 44% wholesale for the nine months ended September 30, 1999. Wholesale
loans result in lower revenues due to broker fees paid of approximately 1% being
deducted  directly from the gain on sale,  whereas retail loan  commissions  are
shown on the statement of  operations as expenses.  Costs per loan for wholesale
loans are generally lower overall than retail.  Replacing the retail loan volume
with wholesale loans reduced gains by approximately $575,000 for the nine months
ended  September 30, 2000 compared to the nine months ended  September 30, 1999.
In 1999,  the Company was able to optimize the margins  received on the sales of
loans by hedging positions in future sales of Mortgage Backed  Securities.  This
activity  was halted  due to the  Investigation  and  subsequent  suspension  of
trading of the Company's  stock.  For the nine months ended  September 30, 2000,
this resulted in  approximately a 0.75% loss in revenue per loan or $1.1 million
in total compared to the nine months ended September 30, 1999. Additionally,  in
past years, sub-prime loans were generally sold at a higher per loan margin than
conventional loans.  Discontinuing  sub-prime loan originations reduced gains by
approximately $1.2 million for the nine months ended September 30, 2000 compared
to the nine months ended September 30, 1999.

     The following  table  summarizes the Company's  mortgage  originations  (in
millions):

                                                 Nine months ended September 30,
                                                 -------------------------------
                                                   2000                 1999
                                                   ----                 ----
             Conventional                        $142,877             $300,619
             FHA/VA                                15,386              136,037
             Subprime                                 -                 12,559
                                                 --------             --------
             Total                               $158,263             $449,215
                                                 ========             ========

     Although there can be no assurance  thereof,  the Company expects  mortgage
originations  to increase and therefore  believes its gains on sales of mortgage
loans will increase.

     The loss on sale of  delinquent  loans for the nine months ended  September
30, 2000 was the result of the Company selling at discounted  prices  delinquent
and  non-performing  loans that it would  normally  maintain in its portfolio to
eventually work out and recover its investment through foreclosure procedures or
refinancing.  In prior  years,  PMCC had  warehouse  lines where they could hold
these loans  throughout the  foreclosure  process.  Bank United  terminated this
portion of their line  immediately  after the  Investigation  began in  December
1999. In order to fulfill  agreements  with its lenders,  the Company  needed to
sell the loans to pay off the  warehouse  lines as well as to meet the Company's
additional  cash  requirements  in the first  nine  months of 2000.  These  were
imposed by increased  capital  requirements  and  Amendment  Fees for  warehouse
lines,  reduced warehouse  commitments and additional  professional fees (legal,
consulting and audit) that were incurred as a result of the Investigation.

     Interest  earned  decreased  $2.5 million,  or 68%, to $1.2 million for the
nine months ended September 30, 2000 from $3.7 million for the nine months ended
September  30, 1999.  This  decrease  was  primarily  due to decreased  mortgage
originations  for the nine months  ended  September  30, 2000 as compared to the
nine months ended  September 30, 1999 and the  elimination of sub prime mortgage
originations  which  generally  are at higher rates and are held for sale longer
than conventional mortgage originations.  Additionally,  there was a decrease in
the amount of time a loan is held before being sold to the final investor.  This
more rapid turnover allows the Company to utilize a lower warehouse line.

Expenses.  The following table sets forth the Company's expenses for the periods
indicated:

<TABLE>
<CAPTION>
<S>                                                   <C>           <C>
                                                    Nine months ended September 30,
                                                    -------------------------------
                                                          2000            1999
                                                          ----            ----

Cost of sales-residential rehabilitation properties   $15,838,998    $26,565,987
Compensation and benefits                               4,313,868     9,023,859
Interest expense                                        1,537,155     3,490,676
Expenses resulting from Investigation                   1,577,400          --
Expenses relating to closing Roslyn office                551,170          --
Other general and administrative                        2,903,507     3,803,102
                                                      -----------   -----------
Total expenses                                        $26,722,098   $42,883,624
                                                      ===========   ===========
</TABLE>

     Cost of  sales -  residential  rehabilitation  properties  decreased  $10.8
million,  or 41%, to $15.8 million for the nine months ended  September 30, 2000
from $26.6 million for the nine months ended  September 30, 1999.  This decrease
was the  result of the  decrease  in the number of  properties  sold in the nine
months ended  September 30, 2000 compared to the nine months ended September 30,
1999.

     Compensation and benefits  decreased $4.7 million,  or 52%, to $4.3 million
for the nine months  ended  September  30,  2000 from $9.0  million for the nine
months ended  September  30,1999.  This  decrease was primarily due to decreased
sales salaries and commission,  which are based  substantially  on mortgage loan
originations, and the reductions in staff at the Company's Roslyn and New Jersey
locations,  partly offset by the personnel added in Florida as part of the Prime
Mortgage  Corp.  acquisition  in July  1999.  Total  personnel  decreased  to 40
employees at September 30, 2000 from 172 at September 30, 1999.

     Interest  expense  decreased $2.0 million,  or 57%, to $1.5 million for the
nine months ended September 30, 2000 from $3.5 million for the nine months ended
September 30, 1999. This decrease was primarily  attributable to the decrease in
mortgage  originations  and the  decrease  in the amount of  sub-prime  mortgage
originations  that  generally  are  held  on the  warehouse  lines  longer  than
conventional  mortgage  originations  along  with the  decrease  in  residential
rehabilitation  properties funded through the Company's warehouse facility and a
decrease  in the  amount of time a loan is held  before  being sold to the final
investor

     As a result of the  Investigation,  the Company incurred direct expenses of
$1.6 million in the nine-month  period ended September 30, 2000.  These expenses
include legal and  professional  fees  incurred in connection  with the internal
investigation  of the Company,  criminal  defense  attorneys and negotiations of
warehouse lines of credit  amendments.  Also included in these expenses are bank
fees  relating  to  granting  amendments  to the Bank  United line of credit and
bonuses paid to the Company's officers and employees.

     Expenses  relating to closing the Roslyn  office  include  termination  and
broker  costs for the  settlement  with the  landlord  to  terminate  the lease,
writeoffs of leasehold  improvements  and  capitalized  costs in relation to the
office space, losses on sales of furniture and equipment and severance costs for
terminated employees.

     Other general and  administrative  expense decreased  $900,000,  or 24%, to
$2.9 million for the nine months ended  September 30, 2000 from $3.8 million for
the nine months ended  September  30, 1999.  This  decrease was primarily due to
decreased  expenses in connection  with the contraction in the operations of the
Company, partly offset by increases incurred in connection with the expansion in
Florida  from the Prime  acquisition,  including  rent and  facilities  expense,
telephone and marketing.

     The Company believes that, as a result of certain cost cutting  initiatives
and contraction of business expansion in the first nine months of 2000, expenses
will decrease.

     The net loss of $6.7 million for the nine months ended  September  30, 2000
was a decrease of $7.7 million or 670%,  from the net income of $1.0 million for
the nine months ended September 30, 1999.

Liquidity and Capital Resources

     The Company's  principal  financing needs consist of funding  mortgage loan
originations and residential rehabilitation properties. To meet these needs, the
Company  currently relies on borrowings under warehouse lines of credit and cash
flow from operations.  The amount of outstanding  borrowings under the warehouse
lines of credit at September 30, 2000 was $16.3 million.  The mortgage loans and
residential  rehabilitation  properties  funded  with  the  proceeds  from  such
borrowings secure the warehouse lines of credit

     On August  7,  1998,  the  Company  entered  into a Senior  Secured  Credit
Agreement  (the  "Chase  Line") with Chase Bank of Texas,  National  Association
("Chase")  and PNC Bank  ("PNC").  The Chase Line  provided a warehouse  line of
credit of $120  million  ($90  million  committed  at August  11,  1998) for its
mortgage originations and residential  rehabilitation  purchases. The Chase Line
is secured by the mortgage loans and residential rehabilitation purchases funded
with the proceeds of such borrowings.  The Company has also pledged the stock of
its  residential  rehabilitation  subsidiaries  as  additional  collateral.  The
Company  is  required  to  comply  with  certain  financial  covenants  and  the
borrowings for  residential  rehabilitation  properties are guaranteed by Ronald
Friedman and Robert  Friedman.  The Chase Line  originally  was set to expire in
August 1999 but was extended  through  November 8, 1999.  Chase and PNC both had
decided to curtail  their  involvement  in  mortgage  warehouse  lending and had
decided not to renew the facility  for that  reason.  The Chase Line was further
extended to December  24,  1999 on a  declining  basis in order to complete  the
funding of all loans and  properties  on the line on  November  8, 1999.  No new
loans or properties  were added to this line subsequent to November 8, 1999. The
balance  remaining on this line of $489,000 at November 8, 2000 relates entirely
to the residential  rehab  portfolio.  The Company  anticipates  paying down the
entire  facility  either  through  sales  of  the  underlying  properties  or by
obtaining  an  alternate  financing  source no later  than  December  15,  2000.
Interest  payable  on the Chase  Line is  variable  based on LIBOR plus 1.25% to
2.25%  based  upon the  underlying  collateral.  Minimal  fees were paid for the
extensions and there was no change in the method of calculating interest.

     On  February  28,  2000,  the  Company  entered  into a  Master  Repurchase
Agreement that provides the Company with a warehouse facility  (the"IMPAC Line")
through  IMPAC  Warehouse  Lending  Group  ("IMPAC").  The IMPAC Line provides a
committed  warehouse  line of credit of $20 million for the  Company's  mortgage
originations  only.  The IMPAC Line is secured by the mortgage loans funded with
the proceeds of such borrowings.  Interest payable on the IMPAC Line is variable
based on the Prime Rate as posted by Bank of America, N.A. plus 0.50%. The IMPAC
Line has no  stated  expiration  date but is  terminable  by either  party  upon
written notice.

     The  Company  currently  expects  that  the  existing  IMPAC  Line  will be
sufficient to fund all anticipated  loan  originations  for the current and next
year  provided all new loans are sold to  investors on a loan by loan basis.  At
this  time,  the  Company  has no other  lines of credit or  sources to fund the
closing of its mortgage  loans. In order to maximize  potential  profits through
hedging strategies, additional lines would be required and will be applied for.

     The Company had additional  cash  requirements  in the first nine months of
2000 imposed by the increased  capital  requirements  and Amendment Fees for its
warehouse lines, the reduced warehouse  commitments and additional  professional
fees  (legal,  consulting  and  audit)  that  were  incurred  as a result of the
Investigation.  In order to raise cash expediently, the Company sold residential
rehabilitation   properties   in  its  portfolio  at  prices  that  reduced  the
contractual  fees  the  Company  normally  received  from  the  sales  of  those
properties  and in certain  instances at a price less than the cost to PMCC. The
Company also sold at discounted prices delinquent and non-performing  loans that
it would normally  maintain in its portfolio to eventually  work out and recover
its investment through  foreclosure  procedures or refinancing.  In a continuing
effort to reduce the Company's overhead and expenses and achieve  profitability,
PMCC determined that on October 1, 2000, the Company would permanently close its
office in Roslyn Heights,  NY. The Company has relocated their corporate offices
to the location of the existing branch office and former corporate office in New
Jersey.  In conjunction  with this closing,  the Company has negotiated with its
landlord in Roslyn to  terminate  the  remaining  4.5 years of its lease at that
location.  The  cost for  terminating  employees  and the  lease  in  Roslyn  is
approximately $500,000 which is included in the third quarter financials.  After
all reductions noted herein,  it is anticipated that the Company will experience
annualized cost savings of approximately $1.5 million. Additionally, the Company
closed new "start-up"  retail branches opened in 1998 and 1999, closed the newly
opened  internet  call center in Houston and reduced  staffing at all  remaining
locations.  The Company  believes that a greater  emphasis on wholesale  lending
presents  the Company  with the  ability to continue to offer  consumers a broad
range of products  by the most  cost-effective  means.  The  Company's  existing
capital resources,  including the funds from its $20 million committed warehouse
facility with IMPAC and cash flow from its remaining  operations  along with the
effect of the purchase of the Company's stock by IBUI and resultant merger, or a
similar  agreement,  are expected to be sufficient to fund its current  mortgage
banking  operation  during 2000 and 2001 and to ensure the ongoing  viability of
the Company.  Such a merger would increase the Company's  capital base,  improve
the combined  balance sheet and allow the Company to seek  additional  warehouse
lines of credit, raise additional capital or issue debt securities.

     Net cash  provided by  operations  for the nine months ended  September 30,
2000 was $33.3  million.  The  Company  generated  cash  from the $26.8  million
decrease in mortgage loans held for sale and receivable  from sales of loans and
by a $13.9 million net decrease in residential  rehabilitation  properties.  The
Company used cash to reduce  borrowings  under its warehouse  lines of credit by
$34.2 million.

Impact of New Accounting Standards

     In June 1998,  the FASB  issued SFAS No. 133,  "Accounting  for  Derivative
instruments and Hedging Activities",  effective for fiscal years beginning after
June 15, 1999,  which has been deferred to September 30, 2000 by the  publishing
of SFAS No. 137. SFAS No. 133 establishes accounting and reporting standards for
derivative  instruments and for hedging  activities.  It requires that an entity
recognizes  all  derivatives as either assets or liabilities in the statement of
financial condition and measures those instruments at fair value. The accounting
for changes in the fair value of a derivative (that is, gain and losses) depends
on the intended use of the  derivative and the resulting  designation.  SFAS No.
133 does not require  restatement  of prior  periods.  Management  is  currently
assessing the impact of SFAS No. 133 on its  financial  condition and results of
operations.

Item 3.  Quantitative And Qualitative Disclosures About Market Risk.

None.



<PAGE>
                            PART II-OTHER INFORMATION


Item 1.  Legal Proceedings

     The Registrant is a defendant in certain  litigation  arising in the normal
course  of  its  business.  In the  opinion  of the  Registrant,  any  potential
liability  with respect to such legal actions will not,  individually  or in the
aggregate,  be material to the  Registrant's  financial  position,  liquidity or
future results of operations.

     The U.S.  Attorney's  Office for the  Eastern  District  of New York ("U.S.
Attorney")  is  conducting  an  investigation  (the  "Investigation")  into  the
allegations asserted in a criminal complaint against Ronald Friedman, the former
Chairman of the Board, President and Chief Executive Officer of the Company, and
a loan officer formerly employed by the Company. On December 21, 1999, agents of
the Office of Inspector  General for HUD executed  search and arrest warrants at
the Roslyn  offices of the Company.  The warrants  were issued on the basis of a
federal criminal complaint ("Complaint"), which charged that Ronald Friedman and
the loan officer  knowingly and intentionally  made,  uttered or published false
statements in connection with loans to be insured by HUD.

     In response to the allegations  against the loan officer and Friedman,  the
Company  engaged  the  legal  services  of Dorsey & Whitney  LLP to  conduct  an
internal  investigation  into the  alleged  misconduct  and to  prepare a report
discussing the findings of the internal investigation.  As part of this internal
investigation,  the Company worked  closely and in cooperation  with HUD and the
U.S.  Attorney.  In addition,  key  employees,  including  loan  officers,  loan
processors,  underwriters  and  managers,  were  interviewed.  An audit also was
conducted of over one-third of all 1999 FHA loans in order to assess whether the
files comported with the HUD guidelines for FHA loans.

     A  preliminary  report  detailing  Dorsey  &  Whitney's  investigation  and
findings was presented to the Company's  Board of Directors on April 12, 2000. A
written  report was issued on April 14, 2000.  The report  concludes  that while
there  appears to be support for the  allegations  leveled at the loan  officer,
there is no evidence that the  misconduct  alleged in the complaint was systemic
at the Company.  Rather,  the findings  support the conclusion  that the alleged
misconduct  was an  isolated  occurrence,  not an  institutional  practice.  The
available  evidence  did not  permit  Dorsey &  Whitney  to  reach a  definitive
conclusion   concerning  the  charges  pending  against  Ronald  Friedman.   The
investigation,  comprised of  interviews  with PMCC  employees  and an extensive
review of mortgage  loan  files,  revealed no  independent  evidence  tending to
support the allegations against Friedman contained in the criminal complaint.

     While the Company  believes that it has not committed  any  wrongdoing,  it
continues to cooperate fully with the U.S.  Attorney's  Office and HUD. However,
it cannot predict the duration of the  Investigation  or its potential  outcome.
Although the Company does not anticipate  being charged in connection  with this
investigation,  in the  event  that the  Company  was  charged,  it  intends  to
vigorously  defend its  position.  While the  Company  does not  anticipate  its
occurrence,  in the event that it was to lose its ability to originate  and sell
FHA loans as result of the Investigation,  the Company does not believe that the
financial  effect on the  Company  would be  material.  The  Company  originates
approximately 7% of its current loan volume through FHA products

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)  Exhibits
               27   Financial Data Schedule

     (b)  Reports on Form 8-K

               Dated July 28, 2000 filed August 21, 2000.
               Dated September 18, 2000 filed September 29, 2000.



<PAGE>
                                   SIGNATURES


     Pursuant to the  requirements  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.


                                               PMCC FINANCIAL CORP.
                                               (Registrant)



                                               By:/s/ Andrew Soskin
                                                  ------------------------------
                                                  Andrew Soskin
                                                  Interim President and Chief
                                                   Executive Officer

                                               By:Stephen J. Mayer
                                                  ------------------------------
                                                  Stephen J. Mayer
                                                  Chief Financial Officer
                                                  (Principal Accounting Officer)

Dated: November 17, 2000