UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM l0-Q

Quarterly Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

For the Quarterly Period Ended March 31, 2005

Commission file number 000-17248

OWENS MORTGAGE INVESTMENT FUND,a California Limited Partnership(Exact Name of Registrant as Specified In Its Charter)

| | California (State or other jurisdiction of incorporation or organization)              |  | 68-0023931(I.R.S. EmployerIdentification No.)
| | -------------------------------------------------------------------------------------- |  | ---------------------------------------------
| | 2221 Olympic BoulevardWalnut Creek, California (Address of principal executiveoffices) |  | 94595(Zip Code)                              
| | (925) 935-3840Registrant'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 [ ]
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Indicate by check mark whether the registrant is an accelerated filer (as defined by Rule 12b-2 of the Exchange Act). Yes [ ] No [X]
| | ------------------------------------------------------------------------------------------------------------------------------------

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TABLE OF CONTENTS

PART I  FINANCIAL INFORMATION

| |         |  |                                                                                      |  | Page
| | ------- |  | ------------------------------------------------------------------------------------ |  | ----
| | Item 1. |  | Financial Statements                                                                 |  | 3   
| | Item 2. |  | Managements Discussion and Analysis of Financial Condition andResults of Operations |  | 15  
| | Item 3. |  | Quantitative and Qualitative Disclosures About Market Risk                           |  | 23  
| | Item 4. |  | Controls and Procedures                                                              |  | 24  

PART II  OTHER INFORMATION

| | Item 1. |  | Legal Proceedings                                   |  | 24
| | ------- |  | --------------------------------------------------- |  | --
| | Item 4. |  | Submission of Matters to a Vote of Security Holders |  | 24
| | Item 5. |  | Other Information                                   |  | 24
| | Item 6. |  | Exhibits                                            |  | 24

| | Exhibit 31.1 |  |  |  | 
| | ------------ |  |  |  | 
| | Exhibit 31.2 |  |  |  | 
| | Exhibit 32   |  |  |  | 

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| | PART I  FINANCIAL INFORMATION
| | ------------------------------

| | Item 1. Financial Statements
| | ----------------------------

OWENS MORTGAGE INVESTMENT FUND,a California Limited Partnership

Consolidated Balance Sheets

March 31, 2005 and December 31, 2004

|                                                                 | (UNAUDITED)March 312005 | December 312004
|---------------------------------------------------------------- | ----------------------- | ---------------
|
|Cash and cash equivalents                                        |                         |                
|Loans secured by trust deeds, net of allowance for               |                         |                
|losses of $4,450,000 in 2005 and $4,100,000 in 2004              |                         |                
|Interest and other receivables                                   |                         |                
|Due from affiliate                                               |                         |                
|Real estate held for sale, net of allowance for losses           |                         |                
|of $660,000 in 2005 and 2004                                     |                         |                
|Real estate held for investment, net of accumulated depreciation |                         |                
|and amortization of $1,509,166 in 2005 and $1,282,430 in 2004    |                         |                
|                                                                 |                         |                
|                                                                 |                         |                
|                                                                 |                         |                
|                                                                 |                         |                

|LIABILITIES AND PARTNERS CAPITAL               
|------------------------------------------------
|LIABILITIES:                                    
|Accrued distributions payable                   
|Due to general partner                          
|Accounts payable and accrued liabilities        
|Note payable                                    
|Note payable to general partner                 
|                                                
|                                                
|Total Liabilities                               
|                                                
|                                                
|Minority interest                               
|                                                
|                                                
|PARTNERS CAPITAL (units subject to redemption):
|General partner                                 
|Limited partners                                
|                                                
|                                                
|Total partners capital                         
|                                                
|                                                
|                                                
|                                                

| | The accompanying notes are an integral part of these financial statements.
| | --------------------------------------------------------------------------

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OWENS MORTGAGE INVESTMENT FUND,a California Limited Partnership

Consolidated Statements of Income

For the Three Months Ended March 31, 2005 and 2004 (Unaudited)

|                                                    | For the Three Months Ended
|--------------------------------------------------- | --------------------------
|
|REVENUES:                                           |                           
|Interest income on loans secured by trust deeds     |                           
|Gain on sale of real estate, net                    |                           
|Rental and other income from real estate properties |                           
|Other income                                        |                           
|                                                    |                           
|Total revenues                                      |                           
|                                                    |                           
|                                                    |                           
|EXPENSES:                                           |                           
|Management fees to general partner                  |                           
|Servicing fees to general partner                   |                           
|Carried interest to general partner                 |                           
|Administrative                                      |                           
|Legal and accounting                                |                           
|Rental and other expenses on real estate properties |                           
|Interest expense                                    |                           
|Minority interest                                   |                           
|Provision for loan losses                           |                           
|Other                                               |                           
|                                                    |                           
|Total expenses                                      |                           
|                                                    |                           
|                                                    |                           
|Net income                                          |                           
|                                                    |                           
|                                                    |                           
|Net income allocated to general partner             |                           
|                                                    |                           
|                                                    |                           
|Net income allocated to limited partners            |                           
|                                                    |                           
|                                                    |                           
|Net income allocated to limited partners            |                           
|per weighted average limited partnership unit       |                           
|(284,420,000 and 281,674,000 average units          |                           
|in 2005 and 2004, respectively)                     |                           
|                                                    |                           
|                                                    |                           

The accompanying notes are an integral part of these financial statements.

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OWENS MORTGAGE INVESTMENT FUND,a California Limited Partnership

Consolidated Statements of Cash Flows

For the Three Months Ended March 31, 2005 and 2004(UNAUDITED)

|                                                        | March 312005 | March 312004
|------------------------------------------------------- | ------------ | ------------
|CASH FLOWS FROM OPERATING ACTIVITIES:                   |              |             
|Net Income                                              |              |             
|Adjustments to reconcile net income                     |              |             
|to net cash provided by operating activities:           |              |             
|Gain on sale of real estate properties                  |              |             
|Provision for loan losses                               |              |             
|Depreciation and amortization                           |              |             
|Changes in operating assets and liabilities:            |              |             
|Interest and other receivables                          |              |             
|Due from affiliate                                      |              |             
|Accounts payable and accrued liabilities                |              |             
|Due to general partner                                  |              |             
|                                                        |              |             
|Net cash provided by operating activities               |              |             
|                                                        |              |             
|                                                        |              |             
|CASH FLOWS FROM INVESTING ACTIVITIES:                   |              |             
|Purchases of loans secured by trust deeds               |              |             
|Principal collected on loans                            |              |             
|Loan payoffs                                            |              |             
|Sales of loans to third parties                         |              |             
|Investment in real estate properties                    |              |             
|Net proceeds from disposition of real estate properties |              |             
|Minority interest in limited liability companies        |              |             
|                                                        |              |             
|Net cash provided by (used in) investing activities     |              |             
|                                                        |              |             
|                                                        |              |             
|CASH FLOWS FROM FINANCING ACTIVITIES:                   |              |             
|Proceeds from sale of partnership units                 |              |             
|Accrued distributions payable                           |              |             
|Repayments on note payable                              |              |             
|Proceeds from origination of note payable               |              |             
|Net advances on line of credit                          |              |             
|Partners cash distributions                            |              |             
|Partners capital withdrawals                           |              |             
|                                                        |              |             
|Net cash (used in) provided by financing activities     |              |             
|                                                        |              |             
|                                                        |              |             
|Net increase in cash and cash equivalents               |              |             
|                                                        |              |             
|Cash and cash equivalents at beginning of period        |              |             
|                                                        |              |             
|                                                        |              |             
|Cash and cash equivalents at end of period              |              |             
|                                                        |              |             
|                                                        |              |             
|Supplemental Disclosures of Cash Flow Information       |              |             
|Cash paid during the period for interest                |              |             
|                                                        |              |             

| | See notes 2 and 3 for supplemental disclosure of non-cash investing activities.
| | -------------------------------------------------------------------------------

| | The accompanying notes are an integral part of these financial statements.
| | --------------------------------------------------------------------------

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OWENS MORTGAGE INVESTMENT FUND,a California Limited Partnership

Notes to Consolidated Financial Statements

March 31, 2005

|(1) |  | Summary of Significant Accounting Policies
|--- |  | ------------------------------------------

| | In the opinion of the management of Owens Mortgage Investment Fund, a California Limited Partnership, (the Partnership) the accompanying unaudited financial statements contain all adjustments, consisting of normal, recurring adjustments, necessary to present fairly the financial information included therein. These financial statements should be read in conjunction with the audited financial statements included in the Partnerships Form 10-K for the fiscal year ended December 31, 2004 filed with the Securities and Exchange Commission. The results of operations for the three month period ended March 31, 2005 are not necessarily indicative of the operating results to be expected for the full year.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Basis of Presentation
| | ---------------------

| | The consolidated financial statements include the accounts of the Partnership and its majority-owned limited liability companies. All significant inter-company transactions and balances have been eliminated in consolidation.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) |  | Loans Secured by Trust Deeds and Allowance for Loan Losses
|--- |  | ----------------------------------------------------------

| | Loans secured by trust deeds as of March 31, 2005 and December 31, 2004 are as follows:
| | ---------------------------------------------------------------------------------------

|                            |  |  |   | 2005        |  |  | 2004        | 
|--------------------------- |  |  | - | ----------- |  |  | ----------- | 
|                            |  |  |   |            
|Income-producing properties |  |  | $ | 169,747,394 |  |  | 159,885,572 | 
|Construction                |  |  |   | 39,496,131  |  |  | 66,934,856  | 
|Unimproved land             |  |  |   | 34,588,413  |  |  | 31,396,474  | 
|Residential                 |  |  |   | 215,000     |  |  | 215,000     | 
|                            |  |  |   |            
|                            |  | 
|                            |  |  | $ | 244,046,938 |  |  | 258,431,902 | 
|                            |  |  |   |            
|                            |  | 
|First mortgages             |  |  | $ | 242,217,164 |  |  | 256,372,106 | 
|Second mortgages            |  |  |   | 1,829,774   |  |  | 2,059,796   | 
|                            |  |  |   |            
|                            |  | 
|                            |  |  | $ | 244,046,938 |  |  | 258,431,902 | 
|                            |  |  |   |            

| | Scheduled maturities of loans secured by trust deeds as of March 31, 2005 and the interest rate sensitivity of such loans are as follows:
| | -----------------------------------------------------------------------------------------------------------------------------------------

|                          | FixedInterestRate | VariableInterestRate | Total
|------------------------- | ----------------- | -------------------- | -----
|Year ending March 31:     |                   |                     
|2005 (past maturity)      |                   |                      | $    
|2006                      |                   |                      |      
|2007                      |                   |                      |      
|2008                      |                   |                      |      
|2009                      |                   |                      |      
|2010                      |                   |                      |      
|Thereafter (through 2014) |                   |                      |      
|                          |                   |                      |      
|                          |                   |                     
|                          |                   |                      | $    
|                          |                   |                      |      

| | The following is a schedule by geographic location of loans secured by trust deeds as of March 31, 2005 and December 31, 2004:
| | ------------------------------------------------------------------------------------------------------------------------------

|               | March 31, 2005Balance | PortfolioPercentage | December 31, 2004Balance | PortfolioPercentage
|-------------- | --------------------- | ------------------- | ------------------------ | -------------------
|Arizona        |                       |                     | $                        | 27,699,326         
|California     |                       |                     |                          | 139,924,394        
|Hawaii         |                       |                     |                          | 15,300,000         
|Idaho          |                       |                     |                          | 1,698,974          
|North Carolina |                       |                     |                          | 18,715,000         
|Nevada         |                       |                     |                          | 9,491,635          
|South Carolina |                       |                     |                          | 3,301,509          
|Texas          |                       |                     |                          | 2,635,000          
|Utah           |                       |                     |                          | 14,333,796         
|Virginia       |                       |                     |                          | 3,185,000          
|Washington     |                       |                     |                          | 7,762,304          
|               |                       |                     |                          |                    
|               |                       |                     | $                        | 244,046,938        
|               |                       |                     |                          |                    

| | Variable rate loans use as indices the one-year, five-year and 10-year Treasury Constant Maturity Index (3.38%, 4.27% and 4.59%, respectively, as of March 31, 2005), the prime rate (5.75% as of March 31, 2005) or the weighted average cost of funds index for Eleventh or Twelfth District savings institutions (2.32% and 2.12%, respectively, as of March 31, 2005) or include terms whereby the interest rate is adjusted at a specific later date. Premiums over these indices have varied from 250650 basis points depending upon market conditions at the time the loan is made.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | A majority of the loans made or invested in by the Partnership require the borrower to make a balloon payment on the principal amount upon maturity of the loan. To the extent that a borrower has an obligation to pay mortgage loan principal in a large lump sum payment, its ability to satisfy this obligation may be dependent upon its ability to sell the property, obtain suitable refinancing or otherwise raise a substantial cash amount. As a result, these loans involve a higher risk of default than fully amortizing loans.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | As of March 31, 2005, the Partnership has commitments to advance additional funds to borrowers of construction and other loans in the total amount of approximately $57,781,000.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | As of March 31, 2005 and December 31, 2004, the Partnership participated in 4 and 3 loans, respectively, with a total principal balance of $27,419,000 and $24,237,000, respectively, with an unrelated mortgage investment group (the Lead Lender) that originated the loans with the borrowers. The General Partner receives the payments on these participated loans from the Lead Lender. Pursuant to Intercreditor Agreements between the Partnership and the Lead Lender on all of the participated loans as of March 31, 2005 and December 31, 2004, the Partnership is guaranteed its share of interest and principal prior to any other investors participating in such loans.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The scheduled maturities for 2005 include approximately $38,077,000 of loans that are past maturity as of March 31, 2005, of which $24,582,000 represents loans for which interest payments are delinquent over 90 days.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | During the three months ended March 31, 2005 and 2004, the Partnership refinanced loans totaling $11,621,000 and $2,630,000, respectively.
| | ------------------------------------------------------------------------------------------------------------------------------------------

| | The Partnerships investment in impaired loans that were delinquent in monthly payments greater than ninety days was approximately $34,289,000 and $37,319,000 as of March 31, 2005 and December 31, 2004, respectively. In addition, the Partnerships investment in impaired loans that were past maturity (delinquent in principal) but current in monthly payments was approximately $13,495,000 and $23,583,000 as of March 31, 2005 and December 31, 2004, respectively. Of these impaired loans, approximately $15,100,000 and $4,000,000, respectively, were in the process of foreclosure and $5,182,000 and $5,182,000, respectively, involved borrowers who were in bankruptcy as of March 31, 2005 and December 31, 2004.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Partnerships investment in loans delinquent in monthly payments greater than ninety days consisted of six and seven loans as of March 31, 2005 and December 31, 2004, respectively. As of March 31, 2005, $10,807,000 of the delinquent loans has a specific related allowance for credit losses totaling $1,800,000. There is a non-specific allowance for credit losses of $2,650,000 for the remaining delinquent balance and for other loans. The Partnership has discontinued the accrual of interest on all loans that are delinquent in monthly payments greater than ninety days.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In February 2005, the Partnership sold two loans in the total amount of $8,660,000 to unrelated parties and collected all principal and outstanding interest. One of the loans with a principal balance of $2,900,000 was delinquent greater than ninety days and in foreclosure as of December 31, 2004.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Changes in the allowance for loan losses for the three months ended March 31, 2005 and 2004 were as follows:
| | ------------------------------------------------------------------------------------------------------------

|                             | 2005 | 2004
|---------------------------- | ---- | ----
|Balance, beginning of period |      |     
|Provision                    |      |     
|Recovery of bad debts        |      |     
|Charge-off                   |      |     
|                             |      |     
|Balance, end of period       |      |     
|                             |      |     

| | The General Partner believes that the allowance for estimated loan losses is appropriate as of March 31, 2005. The allowance for loan losses is evaluated on a regular basis by management and is based upon managements periodic review of the collectibility of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrowers ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. Impairment is measured on a loan by loan basis by either the present value of expected future cash flows discounted at the loans effective interest rate, the loans obtainable market price, or the fair value of the underlying collateral.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | As of March 31, 2005 and December 31, 2004, the Partnerships loans secured by deeds of trust on real property collateral located in Northern California totaled approximately 48% ($118,281,000) and 53% ($135,867,000), respectively, of the loan portfolio. The Northern California region (which includes the following counties and all counties north: Monterey, Fresno, Kings, Tulare and Inyo) is a large geographic area which has a diversified economic base. The ability of borrowers to repay loans is influenced by the economic strength of the region and the impact of prevailing market conditions on the value of real estate.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) |  | Real Estate Held for Sale
|--- |  | -------------------------

| | Real estate held for sale includes the following components as of March 31, 2005:
| | ---------------------------------------------------------------------------------

|                                          | 
|----------------------------------------- | 
|Real estate held for sale                 | 
|Investment in limited liability companies | 
|                                          | 
|                                          | 
|                                          | 

| | During the quarter ended March 31, 2005, two lots (both including houses) located in a manufactured home subdivision development located in Ione, California (that was acquired by the Partnership through foreclosure in 1997) were sold for $356,000, resulting in a gain to the Partnership of approximately $96,000.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Changes in the allowance for real estate losses for the three months ended March 31, 2005 and 2004 were as follows:
| | -------------------------------------------------------------------------------------------------------------------

|                                | 2005 | 2004
|------------------------------- | ---- | ----
|Balance, beginning of period    |      |     
|Provision                       |      |     
|Deductions for real estate sold |      |     
|                                |      |     
|Balance, end of period          |      |     
|                                |      |     

| | Investment in Limited Liability Companies
| | -----------------------------------------

| | Oregon Leisure Homes, LLC
| | -------------------------

| | Oregon Leisure Homes, LLC (OLH) was formed in 2001 between the Partnership and an unrelated developer for the purpose of developing and selling eight condominium units located in Lincoln City, Oregon, which were acquired by the Partnership via a deed in lieu of foreclosure. OLH also purchased two houses located by the ocean in Lincoln City for renovation and ultimate sale.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Partnership is co-manager of OLH and receives 70% of the profits after payment of all interest on the original loan is made to the Partnership and priority return on partner contributions is allocated at the rate of 11% per annum. The assets, liabilities, income and expenses of OLH have been consolidated into the accompanying consolidated balance sheet and income statement of the Partnership.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | During the quarter ended March 31, 2005, the Partnership advanced an additional $42,000 to OLH for continued operation and marketing of the condominium units that are for sale and received repayment of advances of $5,000 from collections on notes receivable. The net loss to the Partnership was approximately $41,000 and $4,000 for the quarters ended March 31, 2005 and 2004, respectively. The Partnerships investment in OLH real property was approximately $1,122,000 as of March 31, 2005 and December 31, 2004.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Dation, LLC
| | -----------

| | Dation, LLC (Dation) was formed in 2001 between the Partnership and an unrelated developer for the purpose of developing and selling lots in a mobile home park located in Lake Charles, Louisiana, which were acquired by the Partnership via a deed in lieu of foreclosure. The Partnership has been advancing funds to Dation as needed. The Partnership is co-manager of Dation and receives 50% of the profits and losses after payment of all interest on the original loan is made to the Partnership and priority return on partner contributions is allocated at the rate of 12% per annum.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Dation sold one lot during the quarter ended March 31, 2005 and repaid $10,000 of the loan to the Partnership. In addition, Dation paid $47,000 of the interest payable to the Partnership during the quarter ended March 31, 2005. The net operating loss to the Partnership was approximately $34,000 and $39,000 during the quarters ended March 31, 2005 and 2004, respectively. The Partnerships total investment in Dation was approximately $2,049,000 and $1,948,000 as of March 31, 2005 and December 31, 2004, respectively.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) |  | Real Estate Held for Investment
|--- |  | -------------------------------

| | Real estate held for investment as of March 31, 2005 is comprised of a retail property located in Greeley, Colorado held within 720 University, LLC (see below), a light industrial building located in Paso Robles, California, a commercial building located in Roseville, California, and an assisted living facility located in Monterey, California and is comprised of the following as of March 31, 2005 and December 31, 2004:
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                               | 2005 | 2004
|------------------------------ | ---- | ----
|Land                           |      |     
|Buildings                      |      |     
|Improvements                   |      |     
|Other                          |      |     
|                               |      |     
|                               |      |     
|                               |      |     
|Less: Accumulated depreciation |      |     
|and amortization               |      |     
|                               |      |     
|                               |      |     
|                               |      |     

| | Bayview Gardens, LLC
| | --------------------

| | The Partnership is the sole member of a limited liability company, Bayview Gardens, LLC (Bayview), which operates an assisted living facility located in Monterey, California (which was obtained by the Partnership via a deed in lieu of foreclosure on a first mortgage loan in June 2004). Under the terms of a lease agreement between the Partnership and Bayview, the assisted living facility is leased to Bayview by the Partnership and the facility is managed by an outside property manager. The net loss to the Partnership from Bayview operations was $40,000 for the three months ended March 31, 2005. The assets, liabilities, income and expenses of Bayview have been consolidated into the accompanying consolidated balance sheet and income statement of the Partnership. The Partnerships investment in Bayview real property was approximately $6,122,000 and $6,166,000 as of March 31, 2005 and December 31, 2004, respectively.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 720 University, LLC
| | -------------------

| | The Partnership has an investment in a limited liability company, 720 University, LLC (720 University), which owns a commercial retail property located in Greeley, Colorado. The Partnership receives 65% of the profits and losses in 720 University after priority return on partner contributions is allocated at the rate of 10% per annum. The assets, liabilities, income and expenses of 720 University have been consolidated into the accompanying consolidated balance sheet and income statement of the Partnership. The net (loss) income to the Partnership was approximately $(26,000) and $35,000 during the quarters ended March 31, 2005 and 2004, respectively. The minority interest of the joint venture partner of approximately $176,000 and $179,000 as of March 31, 2005 and December 31, 2004, respectively, is reported in the accompanying consolidated balance sheets. The Partnerships investment in 720 University property and improvements was
approximately $14,984,000 and $14,830,000 as of March 31, 2005 and December 31, 2004, respectively.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) |  | Transactions with Affiliates
|--- |  | ----------------------------

| | In consideration of the management services rendered to the Partnership, Owens Financial Group, Inc. (OFG), the General Partner, is entitled to receive from the Partnership a management fee payable monthly, subject to a maximum of 2.75% per annum of the average unpaid balance of the Partnerships mortgage loans.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | All of the Partnerships loans are serviced by OFG, in consideration for which OFG receives up to .25% per annum of the unpaid principal balance of the loans.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------

| | OFG, at its sole discretion may, on a monthly basis, adjust the management and servicing fees as long as they do not exceed the allowable limits calculated on an annual calendar year basis. Even though the fees for a particular month may exceed one-twelfth of the maximum limits, at the end of the calendar year the sum of the fees collected for each of the twelve months may not exceed the stated limits. Management fees amounted to approximately $1,139,000 and $836,000 for the three months ended March 31, 2005 and 2004, respectively. Service fee payments to OFG approximated $157,000 and $173,000 for the three months ended March 31, 2005 and 2004, respectively.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The maximum servicing fees were paid to the General Partner during the three months ended March 31, 2005 and 2004. If the maximum management fees had been paid to the General Partner during the three months ended March 31, 2005, the management fees would have been $1,724,000 (increase of $585,000), which would have reduced net income allocated to limited partners by approximately 12.3% and net income allocated to limited partners per weighted average limited partner unit by the same percentage to $.02. If the maximum management fees had been paid to the General Partner during the three months ended March 31, 2004, the management fees would have been $1,908,000 (increase of $1,072,000), which would have reduced net income allocated to limited partners by approximately 19.1% and net income allocated to limited partners per weighted average limited partner unit by the same percentage to $.02.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In determining the management fees and hence the yield to the partners, OFG may consider a number of factors, including current market yields, delinquency experience, uninvested cash and real estate activities. OFG expects that the management fees it receives from the Partnership will vary in amount and percentage from period to period, and it is highly likely that OFG will again receive less than the maximum management fees in the future. However, if OFG chooses to take the maximum allowable management fees in the future, the yield paid to limited partners may be reduced.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Pursuant to the Partnership Agreement, OFG receives all late payment charges from borrowers on loans owned by the Partnership, with the exception of loans participated with outside entities. The amounts paid to or collected by OFG for such charges totaled approximately $160,000 and $238,000 for the three months ended March 31, 2005 and 2004, respectively. In addition, the Partnership remits other miscellaneous fees to OFG, which are collected from loan payments, loan payoffs or advances from loan principal (i.e. funding, demand and partial release fees). Such fees remitted to OFG totaled approximately $5,000 and $23,000 for the three months ended March 31, 2005 and 2004, respectively.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | OFG originates all loans the Partnership invests in and receives loan origination fees from borrowers. Such fees earned by OFG amounted to approximately $6,312,000 and $438,000 on loans originated of approximately $76,096,000 and $15,535,000 for the three months ended March 31, 2005 and 2004, respectively. Of the $6,312,000 and $438,000 in loan origination fees earned by OFG during the quarters ended March 31, 2005 and 2004, $4,000,000 and $79,000, respectively, were back-end fees that will not be collected until either some future date or when the related loans are paid in full.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | OFG is reimbursed by the Partnership for the actual cost of goods and materials used for or by the Partnership and obtained from unaffiliated entities and the actual cost of services of non-management and non-supervisory personnel related to the administration of the Partnership (subject to certain limitations in the Partnership Agreement). The amounts reimbursed to OFG by the Partnership during the three months ended March 31, 2005 and 2004 were $12,000 and $11,000, respectively.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(6) |  | Note Payable
|--- |  | ------------

| | During the three months ended March 31, 2005, 720 University obtained a new note with a financial institution in the amount of $10,500,000, which fully repaid its existing note payable with a balance of $9,729,000 as of December 31, 2004 and provided additional funds for property improvements. The note payable is secured by 720 Universitys retail development in Greeley, Colorado. The note requires monthly interest payments until March 1, 2010 at a fixed rate of 5.07% per annum. Commencing April 1, 2010, monthly payments of $56,816 will be required, with the balance of unpaid principal due on March 1, 2015. Interest expense for the quarters ended March 31, 2005 and 2004 was approximately $135,000 and $83,000, respectively. The note contains certain covenants, which the Company has complied with as of March 31, 2005.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) |  | Note Payable to General Partner
|--- |  | -------------------------------

| | The Partnership has a note payable to the General Partner in the amount of $1,102,895 as of March 31, 2005 as a result of the deed in lieu of foreclosure obtained on a Partnership loan in June 2004. This amount includes the original loan principal balance of $907,446 and accrued interest and late charges to the date of foreclosure of $195,449. The note was amended at the time of foreclosure. The maturity date of the note is June 8, 2009. The principal balance of the original note bears interest at the rate of 12.0% per annum, which is to be accrued and deferred until maturity. As of March 31, 2005, the Partnership has accrued approximately $88,000 of interest on this note, which is included in Due to General Partner in the accompanying consolidated balance sheet. In addition, the amendment specifies that upon the sale of the property, the General Partner will only be paid the amounts due under the note after the Partnership recovers its
basis in the property at the time of sale including any capital improvements made after foreclosure, but excluding the amounts capitalized pursuant to this note.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(8) |  | Line of Credit Payable
|--- |  | ----------------------

| | The Partnership has a line of credit agreement with a group of banks, which provides interim financing on mortgage loans invested in by the Partnership. The amount of credit available under this line of credit is $40,000,000. There was no balance outstanding on the line of credit as of March 31, 2005 and December 31, 2004. Interest expense for the quarters ended March 31, 2005 and 2004 was approximately $1,000 and $203,000, respectively. Borrowings under the line of credit bear interest at the banks prime rate, which was 5.75% as of March 31, 2005. The line of credit expires on July 31, 2005. The Partnership is required to maintain non-interest bearing accounts in the total amount of $500,000 with two of the banks. The agreement requires the Partnership to meet certain financial covenants including profitability, minimum tangible net worth and total liabilities to tangible net worth. The Partnership has complied with these covenants
as of March 31, 2005.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
| | ---------------------------------------------------------------------------------------------

| | Forward Looking Statements
| | --------------------------

| | Some of the information in this Form 10-Q may contain forward-looking statements. Such statements can be identified by the use of forward-looking words such as may, will, expect, anticipate, estimate,continue or other similar words. These statements discuss future expectations, contain projections of results of operations or of financial conditions or state other forward-looking information. When considering such forward-looking statements you should keep in mind the risk factors and other cautionary statements in the Partnerships Form 10-Q. Although management of the Partnership believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, there are certain factors, in
addition to these risk factors and cautioning statements, such as general economic conditions, local real estate conditions, adequacy of reserves, or weather and other natural occurrences that might cause a difference between actual results and those forward-looking statements.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Results of Operations
| | ---------------------

| | Overview
| | --------

| | Owens Mortgage Investment Fund (the Partnership) is a California Limited Partnership that invests in mortgage loans on real property located in the United States that are primarily originated by the Partnerships general partner, Owens Financial Group, Inc. (the General Partner).
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Partnerships primary objective is to generate monthly income from its investment in mortgage loans. The Partnerships focus is on making mortgage loans to owners and developers of real property whose financing needs are often not met by traditional mortgage lenders. These include borrowers that traditional lenders may not normally consider because of perceived credit risks based on ratings or experience levels, and borrowers who require faster loan decisions. One of the Partnerships competitive advantages is the ability to approve loan applications more quickly than traditional lenders.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Partnership will originate loans secured by very diverse property types. In addition, the Partnership will occasionally lend to borrowers whom traditional lenders will not normally lend to because of a variety of factors including their credit ratings and/or experience. Due to these factors, the Partnership may make mortgage loans that are riskier than mortgage loans made by commercial banks and other institutional lenders. To compensate for those potential risks, the Partnership seeks to make loans at higher interest rates and with more protection from the underlying real property, such as with lower loan to value ratios.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Partnerships operating results are affected primarily by:
| | --------------------------------------------------------------

|o |  | the amount of cash available to invest in mortgage loans;
|- |  | ---------------------------------------------------------

|o |  | the level of real estate lending activity in the markets serviced;
|- |  | ------------------------------------------------------------------

|o |  | the ability to identify and lend to suitable borrowers;
|- |  | -------------------------------------------------------

|o |  | the interest rates the Partnership is able to charge on loans;
|- |  | --------------------------------------------------------------

|o |  | the level of delinquencies on mortgage loans;
|- |  | ---------------------------------------------

|o |  | the level of foreclosures and related loan and real estate losses experienced; and
|- |  | ----------------------------------------------------------------------------------

|o |  | the income or losses from foreclosed properties prior to the time of disposal.
|- |  | ------------------------------------------------------------------------------

| | Economic developments in the United States have generally been favorable in 2004 and 2005 and this has led to expansion and gains in employment. The strengthening demand has been a factor contributing to the rise in inflation. These and other factors led the Federal Reserve Board to increase the discount rate by a total of 1.75% between March 2004 and March 2005. The rates that the Partnership charges on its loans have not been impacted by these actions. In fact, the weighted average interest rate on Partnership loans declined slightly from 11.12% as of March 31, 2004 to 11.07% as of March 31, 2005. Presently, the General Partner does not expect a noticeable increase in the rates charged on Partnership loans, primarily because there continues to be a shortage of suitable loans for the Partnership
to invest in.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | This shortage is primarily due to there being fewer commercial real estate transactions suitable for Partnership lending and increased competition from other lenders. In general, the decrease in real estate transactions is partially due to real estate values having increased in relation to other investments. During the late 1990s, investors had diverse investment opportunities, such as the stock market and fixed income investments. However, the stock market has become very volatile in the last few years, and yields on fixed income investments have dropped significantly. Owners of commercial real estate are therefore less willing to dispose of their properties, since alternative investments are not currently as attractive.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Increased competition has come both from existing lenders whose lending previously was not in competition with the Partnership, and from newly organized lenders seeking greater returns. Due to their unusually large supplies of cash available for lending, banks and other institutional lenders have become more aggressive in placing loans. Additionally, those investors seeking to maximize returns in a market with fewer acceptable investment opportunities have been willing to take increased risk to obtain ostensibly higher yields. These factors have resulted in decreased lending opportunities for the Partnership.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Partnership has been closed to most new limited partner investments since September 2001, because there have not been enough suitable mortgage loans for the Partnership to invest in to remain fully invested for a sustained period of time. Remaining closed to new investments reduces the Partnerships excess cash that would be invested in lower yielding investments, which could have the effect of decreasing the yield paid to existing limited partners.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | If economic conditions worsen in 2005, the Partnership could experience an increase in loan defaults. This would reduce the amount of income available for distribution to partners. Recognizing this risk, the General Partner seeks to maintain a low loan-to-value ratio on its loans, which as of March 31, 2005 was 57% on a weighted average basis. By this means, the Partnership hopes to protect the value of loans in the event of default by providing an increased equity position in underlying real property in the event of foreclosure. Nevertheless, no assurances can be given that a marked increase in loan defaults accompanied by a rapid decline in real estate values will not have a material adverse effect on the Partnerships financial condition and operating results.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Historically, the General Partner has focused its operations on California and certain Western states. Because the General Partner has a significant degree of knowledge with respect to the real estate markets in such states, it is likely most of the Partnerships loans will be concentrated in such states. As of March 31, 2005, 48.0% of loans were secured by real estate in Northern California, while 11.3% and 8.9% were secured by real estate in Arizona and Southern California, respectively. Such geographical concentration creates greater risk that any downturn in such local real estate markets could have a significant adverse effect upon results of operations.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Commercial real estate markets in segmented areas of California have continued to prosper. However, there can be no assurance that the rate of growth will continue to increase in the future. A worsening economy, particularly in California and Arizona, could adversely affect the Partnerships operating results.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Summary of Financial Results
| | ----------------------------

|                                              | Three Months Ended March 31,
|--------------------------------------------- | ----------------------------
|
|Total revenues                                |                             
|Total expenses                                |                             
|                                              |                             
|                                              |                             
|Net income                                    |                             
|                                              |                             
|                                              |                             
|Net income allocated to limited partners      |                             
|                                              |                             
|                                              |                             
|Net income allocated to limited partners      |                             
|per weighted average limited partnership      |                             
|unit                                          |                             
|                                              |                             
|                                              |                             
|Annualized rate of return to limited          |                             
|partners (1)                                  |                             
|                                              |                             
|                                              |                             
|Distribution per partnership unit (yield) (2) |                             
|                                              |                             
|                                              |                             
|Weighted average limited partnership units    |                             
|                                              |                             

|(1) |  | The annualized rate of return to limited partners is calculated based upon the net income allocated to limited partners per weighted average limited partnership unit as of March 31, 2005 and 2004 divided by the number of months during the period and multiplied by twelve (12) months.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) |  | Distribution per partnership unit (yield) is the annualized average of the monthly yield paid to the partners for the periods indicated. The monthly yield is calculated by dividing the total monthly cash distribution to partners by the prior months ending partners capital balance.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Three Months Ended March 31, 2005 Compared to Three Months Ended March 31, 2004
| | -------------------------------------------------------------------------------

| | Total Revenues
| | --------------

| | Interest income on loans secured by trust deeds decreased $411,000 (5.8%) during the three months ended March 31, 2005, as compared to the same period in 2004. This decrease was the result of a decrease in the weighted average balance of the loan portfolio of 9.6% during the three months ended March 31, 2005, as compared to 2004, and a decrease in the weighted average yield of the loan portfolio from 11.12% for the three months ended March 31, 2004 to 11.07% for the three months ended March 31, 2005.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The mortgage loan portfolio has decreased by $14,385,000 (5.6%) since December 31, 2004, due to loan payoffs without the origination of new loans of the same amount during the quarter ended March 31, 2005. If suitable replacement loans are not originated by the Partnership, the Partnerships net income and distributions to partners may decrease, as the current yield on the Partnerships money market accounts is substantially lower than the yields on mortgage loans.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Rental and other income from real estate properties increased $420,000 (71.4%) during the three months ended March 31, 2005, as compared to the same period in 2004, primarily as a result of revenue earned from the assisted living facility located in Monterey, California that was obtained via foreclosure in June 2004. See further discussion under Real Estate Properties Held for Sale and Investment below.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Other income increased $45,000 (179.4%) during the three months ended March 31, 2005, as compared to the same period in 2004, due primarily to interest earned on money market investments. The Partnership has had an increased amount of cash and equivalents available during the quarter as a result of loan payoffs in excess of loan originations.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Total Expenses
| | --------------

| | Management fees to the General Partner are paid pursuant to the Partnership Agreement and are determined at the sole discretion of the General Partner. The maximum management fee permitted under the Partnership Agreement is 2 3⁄4% per year of the average unpaid balance of mortgage loans. For the years 2002, 2003 and 2004 and the three months ended March 31, 2005 (annualized), the management fees were 1.46%, 2.01%, 2.00% and 1.81% of the average unpaid balance of mortgage loans, respectively.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In determining the management fees and hence the yield to the partners, the General Partner may consider a number of factors, including current market yields, delinquency experience, uninvested cash and real estate activities. The General Partner expects that the management fees that it receives from the Partnership will vary in amount and percentage from period to period, and it is highly likely that the General Partner will again receive less than the maximum management fees in the future. However, if the General Partner chooses to take the maximum allowable management fees in the future, the yield paid to limited partners may be reduced.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | If the maximum management fees had been paid to the General Partner during the three months ended March 31, 2005, the management fees would have been $1,724,000 (increase of $585,000), which would have reduced net income allocated to limited partners by approximately 12.3% and net income allocated to limited partners per weighted average limited partner unit by the same percentage to $.02.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Legal and accounting expenses increased $34,000 (39.5%) due to accounting and consulting expenses incurred in the effort to ready the Partnerships internal controls for audit pursuant to Rule 404 of the Sarbanes-Oxley Act. The Partnership will continue to incur accounting and consulting related fees that have not been incurred in the past as this project is continued into 2005 and 2006.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Rental and other expenses on real estate properties increased $103,000 (11.1%) during the three months ended March 31, 2005, as compared to the same period in 2004, primarily due to the acquisition through foreclosure of the assisted living facility located in Monterey, California in June 2004. See further discussion under Real Estate Properties Held for Sale and Investment below.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Interest expense decreased $62,000 (21.7%) during the three months ended March 31, 2005, as compared to the same period in 2004, primarily because the Partnership did not utilize its line of credit to invest in loans secured by trust deeds during the quarter ended March 31, 2005.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The increase in the provision for loan losses of $450,000 during the three months ended March 31, 2005 was the result of an analysis performed on the loan portfolio, which resulted in an increase in the allowance for loan losses of $350,000 during the quarter. In addition, during the three months ended March 31, 2004, the Partnership collected $100,000 from a former borrower of a defaulted loan pursuant to a guarantee agreement. No such amounts were collected during the quarter ended March 31, 2005.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Financial Condition
| | -------------------

| | March 31, 2005 and December 31, 2004
| | ------------------------------------

| | Loan Portfolio
| | --------------

| | The number of Partnership mortgage investments decreased from 87 to 81, and the average loan balance increased from $2,970,000 to $3,013,000 between December 31, 2004 and March 31, 2005.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Approximately $34,289,000 (14.1%) and $37,319,000 (14.4%) of the loans invested in by the Partnership were more than ninety days delinquent in monthly payments as of March 31, 2005 and December 31, 2004, respectively. In addition, the Partnerships investment in loans that were past maturity (delinquent in principal) but current in monthly payments was approximately $13,495,000 (5.5%) and $23,583,000 (9.3%) as of March 31, 2005 and December 31, 2004, respectively. Of the total impaired loans as of March 31, 2005, one loan in the amount of $4,300,000 was paid off in full subsequent to quarter end. Of the total past maturity loans as of March 31, 2005, one loan in the amount of $7,500,000 had the maturity date extended subsequent to quarter end. Of the impaired loans, approximately $15,100,000
(6.2%) and $4,000,000 (1.5%), respectively, were in the process of foreclosure, and approximately $5,182,000 (2.1%) and $5,182,000 (2.0%), respectively, involved loans to borrowers who were in bankruptcy.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Loans in the process of foreclosure as of December 31, 2004 consisted of two loans, of which one loan in the amount of $2,900,000 was sold to an unrelated party during the three months ended March 31, 2005 and one loan in the amount of $1,100,000 is still delinquent and in foreclosure. In addition, one loan in the amount of $14,000,000 entered into foreclosure during the three months ended March 31, 2005. This loan is secured by 4 cemeteries and 8 mortuaries located in Hawaii. The loan has been past maturity since March 31, 2004 and is delinquent in monthly interest payments by approximately six months as of March 31, 2005. The Partnership has participated in this loan with an unrelated mortgage investment group (the Lead Lender) that originated the loan with the borrower. The
Partnership and the Lead Lender are subject to an Intercreditor Agreement, the terms of which state that the Partnership is guaranteed its share of interest and principal prior to any other lenders participated in the loan. The other lenders have an additional $20,000,000 invested in this loan. The General Partner has concluded that the underlying collateral is sufficient to protect the Partnership against a loss of principal in the event of foreclosure, and, thus, no specific allowance for loan losses was deemed necessary for this loan.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Loans involving borrowers in bankruptcy as of December 31, 2004 consisted of two loans, which are still in bankruptcy as of March 31, 2005.
| | -------------------------------------------------------------------------------------------------------------------------------------------

| | As of March 31, 2005 and December 31, 2004, the Partnership held the following types of mortgages:
| | --------------------------------------------------------------------------------------------------

|                            | March 31,2005 | December 31,2004
|--------------------------- | ------------- | ----------------
|1st Mortgages               |               |                 
|2nd Mortgages               |               |                 
|                            |               |                 
|Total                       |               |                 
|                            |               |                 
|                            |               |                 
|Income Producing Properties |               |                 
|Construction                |               |                 
|Unimproved Land             |               |                 
|Residential                 |               |                 
|                            |               |                 
|Total                       |               |                 
|                            |               |                 

| | The Partnerships total loan portfolio decreased by $14,385,000 (5.6%) since December 31, 2004 due to the full and partial payoff of several loans during the quarter ended March 31, 2005 without the origination of new loans of the same amount.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Partnerships investment in construction loans decreased by $27,439,000 (41.0%) during the three months ended March 31, 2005. This decrease was primarily due to partial payoffs received on one loan in the amount of $10,517,000 and the completion of construction (and reclassification to Income Producing) on properties securing two loans in the total amount of $22,342,000, net of additional advances on other construction loans during the quarter.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Partnerships investment in loans on unimproved land increased by $3,192,000 (10.2%) during the three months ended March 31, 2005. This increase was primarily the result of the origination of one new loan secured by unimproved land in the total amount of $3,390,000 during the three months ended March 31, 2005. All of the loans secured by unimproved land are first trust deeds.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Changes in the allowance for loan losses for the three months ended March 31, 2005 and 2004 were as follows:
| | ------------------------------------------------------------------------------------------------------------

|                             | 2005 | 2004
|---------------------------- | ---- | ----
|Balance, beginning of period |      |     
|Provision                    |      |     
|Recovery of bad debts        |      |     
|Charge-off                   |      |     
|                             |      |     
|Balance, end of period       |      |     
|                             |      |     

| | Real Estate Properties Held for Sale and Investment
| | ---------------------------------------------------

| | As of March 31, 2005, the Partnership held title to ten properties that were foreclosed on or purchased by the Partnership since 1994 in the amount of $32,702,000 (including properties held in four limited liability companies), net of allowance for losses of $660,000 and accumulated depreciation and amortization of $1,509,000. As of March 31, 2005, properties held for sale total $9,273,000 and properties held for investment total $23,429,000. When the Partnership acquires property by foreclosure, it typically earns less income on those properties than could be earned on mortgage loans and may not be able to sell the properties in a timely manner.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | During the three months ended March 31, 2005, two lots (both including houses) located in a manufactured home subdivision development located in Ione, California (that was acquired by the Partnership through foreclosure in 1997) were sold for $356,000, resulting in a gain to the Partnership of approximately $96,000.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Changes in the allowance for real estate losses for the three months ended March 31, 2005 and 2004 were as follows:
| | -------------------------------------------------------------------------------------------------------------------

|                                | 2005 | 2004
|------------------------------- | ---- | ----
|Balance, beginning of period    |      |     
|Provision                       |      |     
|Deductions for real estate sold |      |     
|                                |      |     
|Balance, end of period          |      |     
|                                |      |     

| | Three of the Partnerships ten properties do not currently generate revenue. Expenses from real estate properties have increased from approximately $930,000 to $1,033,000 (11.1%) for the three months ended March 31, 2004 and 2005, respectively, and revenues associated with these properties have increased from $588,000 to $1,008,000 (71.4%), respectively.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The increase in revenue and expenses from real estate properties is due primarily to the acquisition through foreclosure of the assisted living facility located in Monterey, California in June 2004. Revenues and expenses for this property were approximately $356,000 and $444,000 (including depreciation), respectively, for the three months ended March 31, 2005. The increase in expenses from the assisted living facility was partially offset by a decrease in expenses of approximately $314,000 due to the sale of the hotel and casino located in Las Vegas, Nevada in October 2004.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Cash and Cash Equivalents
| | -------------------------

| | Cash and cash equivalents increased from approximately $9,009,000 as of December 31, 2004 to approximately $24,622,000 as of March 31, 2005 ($15,613,000 or 173.3%) due primarily to loan payoffs without the origination of new loans of the same amount during the quarter ended March 31, 2005.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Interest and Other Receivables
| | ------------------------------

| | Interest and other receivables increased from approximately $3,196,000 as of December 31, 2004 to $3,542,000 as of March 31, 2005 ($346,000 or 10.8%) due primarily to the accrual of past due interest on certain delinquent loans during the three months ended March 31, 2005, as they were collected in April 2005.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Due from Affiliate
| | ------------------

| | Due from affiliate decreased from approximately $62,000 as of December 31, 2004 to $15,000 ($47,000 or 76.0%) as of March 31, 2005 due to the collection of accrued interest from Dation as a result of lot and house sales during the three month period.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Due to General Partner
| | ----------------------

| | Due to General Partner decreased from approximately $673,000 as of December 31, 2004 to approximately $531,000 as of March 31, 2005 ($142,000 or 21.1%) due to decreased management fees owed to the General Partner as of March 31, 2005 pursuant to the Partnership Agreement (see Results of Operations above). This decrease was partially offset by an increase in interest payable to the General Partner pursuant to a note in the amount of $1,102,895, which the Partnership became subject to as a result of the deed in lieu of foreclosure of a Partnership loan in June 2004.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Note Payable
| | ------------

| | Note payable increased from approximately $9,728,000 as of December 31, 2004 to $10,500,000 ($772,000 or 7.9%) as of March 31, 2005 due to the refinancing of the note payable securing the Greeley, Colorado retail complex. The existing note payable was fully paid with the proceeds and the additional funds from the new loan have been or will be used for property improvements.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Asset Quality

| | There is no precise method of predicting specific losses or amounts that ultimately may be charged off on specific loans or on segments of the loan portfolio. The conclusion that a Partnership loan may become uncollectible, in whole or in part, is a matter of judgment. Although lenders such as banks and savings and loans are subject to regulations that require them to perform ongoing analyses of their loan portfolios (including analyses of loan to value ratios, reserves, etc.), and to obtain current information regarding its borrowers and the securing properties, the Partnership is not subject to these regulations and has not adopted these practices. Rather, management of the General Partner, in connection with the quarterly closing of the accounting records of the Partnership and the preparation
of the financial statements, evaluates the Partnerships mortgage loan portfolio. The allowance for loan losses is established through a provision for loan losses based on the General Partners evaluation of the risk inherent in the Partnerships loan portfolio and current economic conditions. Such evaluation, which includes a review of all loans on which full collectibility may not be reasonably assured, considers among other matters:
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o |  | prevailing economic conditions;
|- |  | -------------------------------

|o |  | the Partnerships historical loss experience;
|- |  | ---------------------------------------------

|o |  | the types and dollar amounts of loans in the portfolio;
|- |  | -------------------------------------------------------

|o |  | borrowers financial condition and adverse situations that may affect the borrowers ability to pay;
|- |  | ----------------------------------------------------------------------------------------------------

|o |  | evaluation of industry trends;
|- |  | ------------------------------

|o |  | review and evaluation of loans identified as having loss potential; and
|- |  | -----------------------------------------------------------------------

|o |  | estimated net realizable value or fair value of the underlying collateral.
|- |  | --------------------------------------------------------------------------

| | Based upon this evaluation, a determination is made as to whether the allowance for loan losses is adequate to cover potential losses of the Partnership. Additions to the allowance for loan losses are made by charges to the provision for loan losses. Loan losses deemed to be uncollectible are charged against the allowance for loan losses. Recoveries of previously charged off amounts are credited to the allowance for loan losses.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | During the quarter ended March 31, 2005, the Partnership increased the allowance for loan losses in the amount of $350,000. As of March 31, 2005, management believes that the allowance for loan losses of $4,450,000 and the allowance for real estate losses in the amount of $660,000 are adequate.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Liquidity and Capital Resources

| | Sales of Units to investors, portfolio loan payoffs, and advances on the Partnerships line of credit provide the capital for new mortgage investments. If general market interest rates were to rise substantially, investors might turn to interest-yielding investments other than Partnership Units, which would reduce the liquidity of the Partnership and its ability to make additional mortgage investments to take advantage of the generally higher interest rates. In contrast, a significant increase in the dollar amount of loan payoffs and additional limited partner investments without the origination of new loans of the same amount would increase the liquidity of the Partnership. This increase in liquidity could result in a decrease in the yield paid to limited partners as the Partnership would
be required to invest the additional funds in lower yielding, short term investments. With the exception of the reinvestment of distributions, the Partnership has been closed to most new limited partner investments since September 2001, because there have not been enough suitable mortgage investments to allow the Partnership to remain fully invested in loans for a sustained period of time.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Withdrawal percentages have been 6.64%, 5.45%, 3.32%, 4.42%, 4.47% and 3.0% (annualized) for the years ended December 31, 2000, 2001, 2002, 2003, 2004 and the three months ended March 31, 2005, respectively. These percentages are the annual average of the limited partners capital withdrawals in each calendar quarter divided by the total limited partner capital as of the end of each quarter.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The limited partners may withdraw, or partially withdraw, from the Partnership and obtain the return of their outstanding capital accounts at $1.00 per Unit within 61 to 91 days after written notices are delivered to the General Partner, subject to the following limitations, among others:
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | o No withdrawal of Units can be requested or made until at least one year from the date of purchase of those Units, other than Units received under the Partnerships Reinvested Distribution Plan.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | o Any such payments are required to be made only from net proceeds and capital contributions (as defined) during said 91-day period.
| | ------------------------------------------------------------------------------------------------------------------------------------

| | o A maximum of $100,000 per partner may be withdrawn during any calendar quarter.
| | ---------------------------------------------------------------------------------

| | o The General Partner is not required to establish a reserve fund for the purpose of funding such payments.
| | -----------------------------------------------------------------------------------------------------------

| | o No more than 10% of the total outstanding limited partnership interests may be withdrawn during any calendar year except upon a plan of dissolution of the Partnership.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Partnership may incur indebtedness for the purpose of investing in mortgage loans, among other things. The total amount of indebtedness incurred by the Partnership cannot exceed the sum of 50% of the aggregate fair market value of all Partnership loans. The Partnership has executed a line of credit agreement with a bank, which provides interim financing on mortgage loans invested in by the Partnership. The amount of credit available under this line of credit is $40,000,000. There was no balance outstanding on the line of credit as of March 31, 2005. The Partnership also has a note payable with a bank through its investment in 720 University, LLC with a balance of $10,500,000 as of March 31, 2005.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Contingency Reserves

| | The Partnership maintains cash, cash equivalents and marketable securities as contingency reserves in an aggregate amount of 2% of the limited partners capital accounts to cover expenses in excess of revenues or other unforeseen obligations of the Partnership. Although the General Partner believes that contingency reserves are adequate, it could become necessary for the Partnership to sell or otherwise liquidate certain of its investments to cover such contingencies on terms which might not be favorable to the Partnership.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Item 3. Quantitative and Qualitative Disclosures About Market Risk
| | ------------------------------------------------------------------

| | The following table contains information about the Partnerships interest earning assets and interest bearing liabilities as of March 31, 2005. The presentation for each category aggregates the assets and liabilities by their maturity dates for maturities occurring in each of the years 2006 through 2010 and aggregates the information for all maturities arising after 2010. The carrying values of the assets and liabilities approximate their fair values as of March 31, 2005.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Interest Earning Assets and Interest Bearing Liabilities,Aggregated by Maturity DateTwelve Months Ended March 31,

|                      | 2006 | 2007 | 2008 | 2009        | 2010 | Thereafter | Total     
|--------------------- | ---- | ---- | ---- | ----------- | ---- | ---------- | ----------
|Interest earning      |      |      |      |             |      |            |           
|assets:               |      |     
|Money market          |      |     
|accounts              |      |      | $    | 24,010,666  |      |            | --        
|Average interest rate |      |      |      | 1.7%        |      |            | --        
|Loans secured by      |      |     
|trust deeds           |      |      | $    | 125,773,750 |      | $          | 67,899,535
|Average interest rate |      |      |      | 11.6%       |      |            | 10.9%     
|                      |      |     
|Interest bearing      |      |     
|liabilities:          |      |     
|Note payable to bank  |      |      |      | --          |      |            | --        
|Average interest rate |      |      |      | --          |      |            | --        
|Note payable to       |      |     
|general partner       |      |      |      | --          |      |            | --        
|Average interest rate |      |      |      | --          |      |            | --        

| | Market Risk
| | -----------

| | Market risk is the exposure to loss resulting from changes in interest rates, equity prices and real estate values. The Partnership does not have any assets or liabilities denominated in foreign currencies. The Partnership does not hedge or otherwise seek to manage interest rate risk. The Partnership does not enter into risk sensitive instruments for trading purposes.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The majority of the Partnerships mortgage loans (85.4% as of March 31, 2005) earn interest at fixed rates. All of the mortgage loans are held for investment purposes and are held until maturity. None of the mortgage loans have prepayment penalties. Changes in interest rates may affect the value of the Partnerships investment in mortgage loans and the rates at which the Partnership reinvests funds obtained from loan repayments and new capital contributions from limited partners. As interest rates increase, although the interest rates the Partnership obtains from reinvested funds will generally increase, the value of the Partnerships existing loans at fixed rates will generally tend to decrease. As interest rates decrease, the amounts becoming available to the Partnership for
investment due to repayment of Partnership loans may be invested at lower rates than the Partnership had been able to obtain in prior investments, or than the rates on the repaid loans. The Partnerships note payable bears interest at a fixed rate of 5.07%. The Partnerships line of credit payable (currently no balance outstanding) bears interest at a variable rate, tied to the bank discount rate. As a result, the Partnerships primary market risk exposure is to changes in interest rates, which will affect the interest cost of outstanding amounts on the note and line of credit payable.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Item 4. Controls and Procedures
| | -------------------------------

| | Within the 90 days prior to the date of this report, the General Partner of the Partnership carried out an evaluation, under the supervision and with the participation of the General Partners management, including the General Partners Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Partnerships disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer of the General Partner concluded that the Partnerships disclosure controls and procedures are effective. There were no significant changes in the Partnerships internal controls or in other factors that could significantly affect these controls subsequent to the
date of their evaluation.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | PART II. OTHER INFORMATION
| | --------------------------

| | Item 1. Legal Proceedings
| | -------------------------

| | The Partnership is not presently involved in any material legal proceedings.
| | ----------------------------------------------------------------------------

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

| | None
| | ----

| | Item 5. Other Information
| | -------------------------

|(a) |  | There was no information required to be filed in a Form 8-K during the first quarter of 2005.
|--- |  | ---------------------------------------------------------------------------------------------

|(b) |  | None
|--- |  | ----

| | Item 6. Exhibits
| | ----------------

|(a) |  | Exhibits
|--- |  | --------

|3 |  | Sixth Amended and Restated Agreement of Limited Partnership, incorporated by reference to Exhibit A to Post-Effective Amendment No. 5 to the Form S-11 Registration Statement No. 333-69272 filed April 17, 2005 and declared effective on April 28, 2005.
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3.1 |  | Certificate of Limited Partnership  Form LP-1: Filed July 1, 1984*
|--- |  | -------------------------------------------------------------------

|3.2 |  | Amendment to Certificate of Limited Partnership  Form LP-2: Filed March 20, 1987*
|--- |  | ----------------------------------------------------------------------------------

|3.3 |  | Amendment to Certificate of Limited Partnership  Form LP-2: Filed August 29, 1989*
|--- |  | -----------------------------------------------------------------------------------

|3.4 |  | Amendment to Certificate of Limited Partnership  Form LP-2: Filed October 22, 1992*
|--- |  | ------------------------------------------------------------------------------------

|3.5 |  | Amendment to Certificate of Limited Partnership  Form LP-2: Filed January 24, 1994*
|--- |  | ------------------------------------------------------------------------------------

|3.6 |  | Amendment to Certificate of Limited Partnership  Form LP-2: Filed December 30, 1994*
|--- |  | -------------------------------------------------------------------------------------

|4.1 |  | Sixth Amended and Restated Limited Partnership Agreement, incorporated by reference to Exhibit A to Post-Effective Amendment No. 5 to the Form S-11 Registration Statement No. 333-69272 filed April 17, 2005 and declared effective on April 28, 2005.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.2 |  | Subscription Agreement and Power of Attorney, incorporated by reference to Exhibit B to Post-Effective Amendment No. 5 to the Form S-11 Registration Statement No. 333-69272 filed April 17, 2005 and declared effective on April 28, 2005.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|31.1 |  | Section 302 Certification of William C. Owens
|---- |  | ---------------------------------------------

|31.2 |  | Section 302 Certification of Bryan H. Draper
|---- |  | --------------------------------------------

|32 |  | Certifications Pursuant to U.S.C. 18 Section 1350
|-- |  | -------------------------------------------------

| | *Previously filed under Amendment No. 3 to Registration Statement No. 333-69272 and incorporated herein by this reference.
| | --------------------------------------------------------------------------------------------------------------------------

---

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.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Dated:   May 12, 2005 |  | OWENS MORTGAGE INVESTMENT FUND,a California Limited PartnershipBy:   Owens Financial Group, Inc., General Partner
| | --------------------- |  | -----------------------------------------------------------------------------------------------------------------
| | Dated:   May 12, 2005 |  | By:   /s/ William C. Owens         William C. Owens, President                                                   
| | Dated:   May 12, 2005 |  | By:   /s/ Bryan H. Draper         Bryan H. Draper, Chief Financial Officer                                       
| | Dated:   May 12, 2005 |  | By:   /s/ Melina A. Platt         Melina A. Platt, Controller