UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

             [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934
                     For the quarter ended June 30, 2007, or

              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                 For the Transition Period from _____ to ______

                         Commission file number: 0-9341

                     SECURITY NATIONAL FINANCIAL CORPORATION
             (Exact name of registrant as specified in its charter)

          UTAH                                              87-0345941
(State or other jurisdiction of                           (I.R.S. Employer
 incorporation or organization)                           Identification No.)

5300 South 360 West, Suite 250 Salt Lake City, Utah            84123
(Address of principal executive office)                     (Zip Code)

Registrant's telephone number, including area code:   (801) 264-1060

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

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 a large  accelerated  filer, an
accelerated  filer, or a  non-accelerated  filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Securities  Exchange Act
of 1934. (Check one)

Large accelerate filer [ ]  Accelerated filer  [ ] Non-accelerated filer [X}

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Securities Exchange Act of 1934): Yes No [X] ---

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock as of the latest practicable date.

Class A Common Stock, $2.00 par value               6,297,729
-------------------------------------               ---------
       Title of Class                        Number of Shares Outstanding as of
                                                   July 31, 2007

Class C Common Stock, $.20 par value                7,500,000
------------------------------------                ---------
       Title of Class                        Number of Shares Outstanding as of
                                                  July 31, 2007

  ============================================================================


<PAGE>


            SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES
                                    FORM 10-Q

                           QUARTER ENDED JUNE 30, 2007

                                TABLE OF CONTENTS


                         PART I - FINANCIAL INFORMATION



Item 1       Financial Statements                                  Page No.
------                                                             --------

        Condensed Consolidated Balance Sheets June 30, 2007
        and December 31, 2006, (unaudited)..................................3-4

        Condensed Consolidated Statements of Earnings - Three and
        Six Months ended June 30, 2007 and 2006 (unaudited)...................5

        Condensed Consolidated Statements of Cash Flows -
        Six Months ended June 30, 2007 and 2006 (unaudited)...................6

        Notes to Condensed Consolidated Financial Statements (unaudited)...7-14

Item 2  Management's Discussion and Analysis of Financial Condition
        and Results of Operations.........................................15-20

Item 3  Quantitative and Qualitative Disclosures about Market Risk...........20
------

Item 4  Controls and Procedures..............................................20
------

                           PART II - OTHER INFORMATION

         Other Information................................................20-26

         Signature Page......................................................27

         Certifications...................................................28-30

<PAGE>


                     SECURITY NATIONAL FINANCIAL CORPORATION
                                AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)
<TABLE>
<CAPTION>



                                                                                      June 30,          December 31,
Assets                                                                                   2007                2006
                                                                                  -----------------    ----------------
    <S>                                                                             <C>                  <C>
    Investments:
      Fixed maturity securities, held to maturity, at amortized cost                 $ 94,611,167        $ 98,317,519
      Fixed maturity securities, available for sale, at estimated fair value            2,903,281           3,417,531
      Equity securities, available for sale, at estimated fair value                    5,588,669           5,261,695
      Mortgage loans on real estate and construction  loans,
         net of allowances for losses
                                                                                       70,190,705          85,135,011
      Real estate, net of accumulated depreciation                                      4,869,973           5,002,853
      Policy, student and other loans net of allowance
         for doubtful accounts
                                                                                       12,597,159          12,846,986
      Short-term investments                                                            7,008,869           4,586,828
      Accrued investment income                                                         3,004,393           2,684,029
                                                                                      -----------         -----------
    Total investments                                                                  200,774,216         217,252,452
                                                                                      ------------        ------------
    Cash and cash equivalents                                                            7,260,800          10,376,585
    Mortgage loans sold to investors                                                    81,468,491          59,817,248
    Receivable, net                                                                     17,273,249          14,878,118
    Restricted assets of cemeteries and mortuaries                                       5,691,643           5,430,870
    Cemetery perpetual care trust investments                                            1,424,536           1,306,984
    Receivable from reinsurers                                                             718,112             700,850
    Cemetery land and improvements sold to investors                                     9,084,112           8,745,424
    Deferred policy and pre-need contract acquisition costs                             29,650,710          28,395,762
    Property and equipment, net                                                         14,887,037          14,059,529
    Cost of insurance acquired                                                          11,395,705          11,882,047
    Goodwill                                                                               683,191             683,191
    Other                                                                                5,272,072           3,866,123
                                                                                      ------------        ------------
    Total assets                                                                      $385,583,874        $377,395,183
                                                                                      ============        ============
</TABLE>

See accompanying notes to condensed consolidated financial statements.


<PAGE>


                     SECURITY NATIONAL FINANCIAL CORPORATION
                                AND SUBSIDIARIES
                CONDENSED CONSOLIDATED BALANCE SHEETS (Continued)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                     June 30,            December 31,
                                                                                       2007                  2006
                                                                                    ----------           ------------
    <S>                                                                             <C>                   <C>
    Liabilities and Stockholders' Equity
    Liabilities
    Future life, annuity, and other benefits                                        $272,144,533          $268,403,765
    Unearned premium reserve                                                           4,807,565             4,519,387
    Bank loans payable                                                                 8,115,089             6,923,344
    Notes and contracts payable                                                          621,159               747,188
    Deferred pre-need cemetery and mortuary contract revenues                         12,169,581            11,533,798
    Accounts payable                                                                   1,562,118             1,820,178
    Other liabilities and accrued expenses                                            11,619,716            11,611,033
    Income taxes                                                                      16,955,923            16,587,284
                                                                                    ------------          ------------
    Total liabilities                                                                327,995,684           322,145,977
                                                                                    ------------          ------------

     Non-Controlling Interest in Perpetual Care Trusts                                 2,352,529             2,278,510
                                                                                    ------------          ------------

     Stockholders' Equity:
     Common stock:
     Class A: $2.00 par value, 10,000,000 shares
            authorized; issued 7,537,394 shares in 2007 and
            7,533,230 shares in 2006                                                  15,074,788            15,066,460
     Class   B non-voting common stock-$1.00 par value; 5,000,000 shares
             authorized; none issued or outstanding                                       --                    --
     Class   C: convertible common stock - $0.20 par value; 7,500,000 shares
                 authorized; issued 7,500,000 shares in 2007 and 7,117,591
                 shares in 2006                                                        1,500,000             1,423,518
     Additional paid-in capital                                                       17,075,572            17,064,488
     Accumulated other comprehensive income and other items                            2,368,249             1,703,155
     Retained earnings                                                                22,174,740            20,495,063
     Treasury stock at cost - 1,239,665 Class A shares and
             -0- Class C shares in 2007; 1,195,127 Class A shares and
             145,045 Class C shares in 2006                                           (2,957,688)           (2,781,988)
                                                                                    ------------          ------------
                     Total stockholders' equity                                       55,235,661            52,970,696
                                                                                    ------------          ------------
         Total Liabilities and Stockholders' Equity                                 $385,583,874          $377,395,183
                                                                                    ============          ============
</TABLE>


See accompanying notes to condensed consolidated financial statements.


<PAGE>


                     SECURITY NATIONAL FINANCIAL CORPORATION
                                AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                  Three Months Ended               Six Months Ended
                                                                       June 30,                        June 30,
Revenues:                                                          2007           2006            2007           2006
                                                                   ----           ----            ----           ----
<S>                                                             <C>            <C>             <C>            <C>
Insurance premiums and other considerations                     $ 7,906,334    $ 7,403,252     $15,868,609    $14,957,522
Net investment income                                             9,009,038      5,504,372      16,952,496     10,579,058
Net mortuary and cemetery sales                                   3,434,182      3,154,220       6,945,119      6,209,018
Realized gains on investments and other assets                      758,199         60,255         736,668         57,671
Mortgage fee income                                              33,079,231     17,930,096      62,601,118     34,559,687
Other                                                               128,904         94,254        258,030        187,186
                                                                -----------    -----------     -----------    -----------
Total revenues                                                   54,315,888     34,146,449     103,362,040     66,550,142
                                                                -----------    -----------     -----------    -----------

Benefits and expenses:
Death benefits                                                     4,081,699      3,567,731       8,173,978      7,389,690
Surrenders and other policy benefits                                 463,580        410,236       1,072,202        997,361
Increase in future policy benefits                                 2,930,517      3,014,873       5,673,985      5,347,880
Amortization of deferred policy and pre-need
  acquisition costs and cost of insurance acquired                 1,362,645        757,542       2,723,485      1,564,997
General and administrative expenses:
   Commissions                                                    24,855,478     13,686,056      47,295,202     26,048,316
   Salaries                                                        5,901,947      4,247,101      11,686,845      8,489,853
   Other                                                           8,538,985      5,909,659      15,746,867     11,200,425
Interest expense                                                   4,158,004      1,087,760       7,257,325      2,108,551
Cost of goods and services sold-
   Mortuaries and cemeteries
                                                                     663,183        572,624       1,314,923      1,208,045
                                                                ------------   ------------    ------------    -----------
Total benefits and expenses                                       52,956,038     33,253,582     100,944,812     64,355,118
                                                                ------------   -----------     -----------     -----------

Earnings before income taxes                                       1,359,850        892,867       2,417,228      2,195,024
Income tax expense                                                 (328,822)      (169,228)        (641,659)      (457,719)
                                                                 -----------   -----------      -----------    -----------
Net earnings                                                      $1,031,028      $ 723,639     $ 1,775,569    $ 1,737,305
                                                                  ==========      =========     ===========    ===========

Net earnings per class A equivalent common share                       $0.15          $0.10           $0.25          $0.25
                                                                       =====          =====           =====          =====

 Net earnings per class A equivalent common
    share-assuming dilution                                            $0.14          $0.10           $0.24          $0.25
                                                                       =====          =====           =====          =====

 Weighted-average Class A equivalent
     common shares outstanding                                     7,049,416      6,914,442       7,047,167      6,914,441
                                                                 ===========      =========     ===========      =========

 Weighted-average Class A equivalent common
     shares outstanding assuming-dilution                          7,321,334      7,099,143       7,306,302      7,050,468
                                                                 ===========      =========     ===========      =========
</TABLE>

Earnings per share  amounts have been adjusted  retroactively  for the effect of
annual stock dividends.  The  weighted-average  shares outstanding  includes the
weighted-average  Class A common shares and the weighted-average  Class C common
shares  determined on an equivalent Class A common stock basis. Net earnings per
common share  represent net earnings per  equivalent  Class A common share.  Net
earnings per Class C common share is equal to one-tenth (1/10) of such amount.

See accompanying notes to condensed consolidated financial statements.


<PAGE>


                     SECURITY NATIONAL FINANCIAL CORPORATION
                                AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
<TABLE>
<CAPTION>



                                                              Six Months Ended June 30,
                                                                2007           2006
                                                             -----------    ---------
Cash flows from operating activities:
<S>                                                         <C>                   <C>
   Net cash provided by (used in) operating activities      $(16,613,660)         $12,925,511
                                                            ------------          -----------

Cash flows from investing activities:
Securities held to maturity:
   Purchase - fixed maturity securities                       (2,026,486)          (6,874,419)
   Calls and maturities - fixed maturity securities            5,756,249            1,926,606
Securities available for sale:
   Purchase - fixed maturity securities                          (76,974)            (134,262)
   Sales - equity securities                                     789,494            9,164,900
Purchases of short-term investments                          (10,817,321)          (7,387,637)
Sales of short-term investments                                8,395,280                --
Purchases of restricted assets                                  (243,851)              12,500
Change in assets for perpetual care trusts                       (89,321)              19,897
Amount received for perpetual care trusts                         74,019               57,475
Mortgage, policy, and other loans made                       (32,831,713)         (36,282,485)
Payments received for mortgage, policy, and other loans       47,986,468           22,858,386
Purchases of property and equipment                           (1,981,495)            (664,104)
Disposal of property and equipment                               730,242                --
Purchases of real estate                                      (1,219,465)          (1,686,113)
Sale of real estate                                            1,195,183            2,039,638
                                                             -----------         ------------
   Net cash provided by (used in) investing activities        15,640,309          (16,949,618)
                                                             -----------         -----------

Cash flows from financing activities:
Annuity contract receipts                                      2,954,809            2,992,944
Annuity contract withdrawals                                  (6,136,505)          (5,013,124)
Sale of treasury stock                                            --                  19,619
Repayment of bank loans and notes and
   contracts payable                                            (787,138)          (1,270,089)
Proceeds from borrowing on bank loans                          1,826,400              750,000
                                                             -----------          -----------
Net cash used in financing activities                         (2,142,434)          (2,520,650)
                                                             -----------          -----------

Net change in cash and cash equivalents                       (3,115,785)          (6,544,757)

Cash and cash equivalents at beginning of period              10,376,585           16,632,966
                                                            ------------          -----------
Cash and cash equivalents at end of period                  $  7,260,800          $10,088,209
                                                            ============          ===========
</TABLE>

See accompanying notes to condensed consolidated financial statements.


<PAGE>



            SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                            June 30, 2007 (Unaudited)

1.   Basis of Presentation

The accompanying  unaudited consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
of America for interim  financial  information and with the instructions to Form
10-Q and Article 10 of Regulation S-X.  Accordingly,  they do not include all of
the  information  and disclosures  required by accounting  principles  generally
accepted in the United  States of America  for  complete  financial  statements.
These financial  statements  should be read in conjunction with the consolidated
financial  statements  of the  Company  and  notes  thereto  for the year  ended
December 31, 2006,  included in the  Company's  Annual Report on Form 10-K (file
number 0-9341).  In the opinion of management,  all  adjustments  (consisting of
normal recurring  accruals)  considered  necessary for a fair  presentation have
been  included.  Operating  results for the three and six months  ended June 30,
2007 are not necessarily  indicative of the results that may be expected for the
year ending December 31, 2007.

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that affect the amounts  reported in the  financial
statements  and  accompanying  notes.  Actual  results  could  differ from those
estimates.

The estimates  susceptible to  significant  change are those used in determining
the liability for future policy  benefits and claims,  those used in determining
valuation  allowances  for  mortgage  loans on real  estate,  and those  used in
determining  the  estimated  future  costs for  pre-need  sales.  Although  some
variability  is inherent in these  estimates,  management  believes  the amounts
provided are fairly stated in all material respects.

Certain 2006 amounts have been  reclassified  to bring them into conformity with
the 2007 presentation.

2.   Recent Accounting Pronouncements

In July 2006,  the FASB  issued FIN 48,  Accounting  for  Uncertainty  in Income
Taxes, which attempts to set out a consistent  framework for preparers to use to
determine the appropriate level of valuation  allowance tax reserves to maintain
for deferred tax assets relating to uncertain tax positions. This interpretation
for FASB  Statement  No. 109 uses a two-step  approach  wherein a tax benefit is
recognized  if a position  is  more-than-likely-than-not  to be  sustained.  The
amount of the benefit is then  measured to be the highest tax benefit,  which is
greater  than  fifty  percent  likely  to be  realized.  FIN 48  also  sets  out
disclosure requirements to enhance transparency of an entity's tax reserves. The
Company  adopted  this  Interpretation  as of January 1,  2007.  Management  has
considered  the  amounts and the  probabilities  of the  outcomes  that could be
realized upon ultimate  settlement and believes that it is  more-likely-than-not
that the Company's  recorded income tax benefits will be fully  realized.  There
were no  unrecognized  tax  benefits at the  beginning  or at the end of the six
months ended June 30, 2007.

The Company records interest earned on income-tax  refunds in other income,  and
penalties and interest  charged on tax deficiencies in interest  expense.  As of
the date of adoption,  there were no amounts  accrued for  penalties or interest
related to unrecognized tax benefits.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements  ("SFAS
157").  SFAS 157 defines fair value,  establishes a framework for measuring fair
value, and expands disclosures about fair value  measurements.  SFAS 157 will be
applied prospectively and is effective for fiscal years beginning after November
15,  2007,  and interim  periods  within  those  fiscal  years.  SFAS 157 is not
expected  to have a  material  impact on the  Company's  consolidated  financial
statements.



<PAGE>


            SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                            June 30, 2007 (Unaudited)


In  February  2007,  the FASB  issued  SFAS No 159,  The Fair  Value  Option for
Financial  Assets and  Financial  Liabilities  - including  an amendment of FASB
Statement  No 115 ("SFAS  159").  SFAS 159 allows  measurement  at fair value of
eligible  financial  assets and liabilities  that are not otherwise  measured at
fair value. If the fair value option for an eligible item is elected, unrealized
gains and losses for that item shall be  reported  in current  earnings  at each
subsequent reporting date. SFAS 159 also establishes presentation and disclosure
requirements  designed  to draw  comparison  between the  different  measurement
attributes the Company elects for similar types of assets and liabilities.  This
statement is effective for fiscal years  beginning  after November 15, 2007. The
Company is in the process of evaluating the application of the fair value option
and its effect on its financial position and results of operations.

3.   Comprehensive Income

For the three months ended June 30, 2007 and 2006,  total  comprehensive  income
amounted to $1,134,604 and $450,827, respectively. This increase of $683,777 was
primarily  the result of an increase in net income of  $307,419,  an increase in
derivatives  of  $111,927,  and an  increase in  unrealized  gains and losses in
securities available for sale of $264,431.

For the six months  ended June 30,  2007 and 2006,  total  comprehensive  income
amounted to $2,440,663 and $2,660,626,  respectively.  This decrease of $219,963
was primarily the result of an increase in net income of $38,294,  a decrease in
derivatives  of  $121,887,  and a  decrease  in  unrealized  gains and losses in
securities available for sale of $136,370.

4.   Stock-Based Compensation

The Company  accounts for its  stock-based  compensation  plans according to the
provisions of Statement of Financial Accounting Standards No. 123R, "Share-Based
Payment" ("FAS 123R") for its stock-based  compensation  plans. Under SFAS 123R,
all stock-based  compensation  is measured at the grant date,  based on the fair
value of the option or award,  and is  recognized as an expense in earnings over
the requisite service, which is typically through the date the options vest.

The Company adopted SFAS 123R using the modified  prospective method. Under this
method, for all stock-based  options and awards granted prior to January 1, 2006
that remain outstanding as of that date, compensation cost is recognized for the
unvested  portion  over  the  remaining  requisite  service  period,  using  the
grant-date fair value measured under the original provisions of SFAS 123 for pro
forma and  disclosure  purposes.  Furthermore,  compensation  costs will also be
recognized  for any awards  issued,  modified,  repurchased  or cancelled  after
January 1, 2006.

The Company  utilized the  Black-Scholes-Merton  model for  calculating the fair
value of stock awards and stock options.

No options were granted for the three and six months ended June 30, 2007.  Total
compensation costs relating to stock-based  compensation was not material during
the three and six months ended June 30, 2007.



<PAGE>


            SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                            June 30, 2007 (Unaudited)

The  Company's  Board of  Directors  granted  stock  options in 2004 to Scott M.
Quist, the Company's  President and Chief Operating  Officer,  to purchase up to
1,000,000  shares of Class C common  stock at exercise  prices of $.323 and $.36
per share.  On May 31, 2007, Mr. Quist made a cashless  exercise of such options
to  purchase  a total of  1,157,625  shares of Class C common  stock that he was
entitled to receive,  after  adjustments for 5% stock dividends  issued in 2005,
2006 and 2007.

In connection with the exercise of such options on a cashless  basis,  Mr. Quist
delivered a total of 58,376  shares of Class A common  stock to the Company that
he held in  exchange  for all the Class C shares he would be entitled to receive
for exercising the options.  Inasmuch as there were 6,966,849  shares of Class C
common  stock  outstanding  as of May  31,  2007  out of a  total  of  7,500,000
authorized  shares of Class C common stock, the Company could legally issue only
533,151  shares of Class C common  stock to Mr.  Quist,  leaving  a  balance  of
624,474 Class C common shares owing to him.

In order to issue the  additional  shares of Class C common  shares owing to Mr.
Quist,  the Board of  Directors  approved on July 13, 2007 an  amendment  to the
Company's  Articles of  Incorporation  to increase  the number of Class C common
shares from 7,500,000 shares to 15,000,000 shares.  Because stockholder approval
is also required to amend the Company's  Articles of Incorporation,  the Company
has  scheduled a special  stockholders  meeting on September 21, 2007 to approve
the  amendment  to the  Articles  of  Incorporation  to  increase  the number of
authorized  shares of Class C common stock from  7,500,000  shares to 15,000,000
shares.

If the stockholders approve the amendment at the special  stockholders  meeting,
the Company will issue Mr. Quist the additional 624,474 shares of Class C common
stock that are owed pursuant to his exercise of stock options.  If the amendment
is  not  approved  at  the  special  stockholders  meeting,  the  Company  will,
alternatively,   issue  Mr.  Quist  62,487  shares  of  Class  A  common  stock,
representing 10% of the 624,474 Class C common shares that are owed to Mr. Quist
based on the conversion  ratio set forth in the Articles of Incorporation of one
share of Class A common stock for each ten shares of Class C common stock. As of
June 30,  2007,  the  Company  has  recorded  the fair  value of the  derivative
liability in the amount of $175,700 to reflect the Company's obligation to issue
the shares of Class C common stock or,  alternatively,  shares of Class A common
stock owed to Mr.  Quist  pursuant to the  exercise of the stock  options.  This
liability  is  included  in  other  liabilities  and  accrued  expenses  in  the
accompanying condensed consolidated balance sheet.



<PAGE>

<TABLE>
<CAPTION>


5. Earnings Per Share

The basic and diluted earnings per share amounts were calculated as follows:

                                                         Three Months Ended June 30,
                                                          2007                   2006
         Numerator:
<S>                                                    <C>                  <C>
              Net income                               $1,031,028           $  723,639
                                                       ==========           ==========
         Denominator:
              Basic weighted-average shares
                outstanding                             7,049,416            6,914,442
                                                      -----------           ----------

         Effect of dilutive securities:
              Employee stock options                      257,075              183,470
              Stock appreciation rights                     --                   1,231
              Employee deferred compensation rights        14,843                --
                                                      -----------           ----------
         Dilutive potential common shares                 271,918              184,701
                                                      -----------           ----------
         Diluted weighted-average
            shares outstanding                          7,321,334            7,099,143
                                                      ===========          ===========

         Basic earnings per share                           $0.15                $0.10
                                                            =====                =====

         Diluted earnings per share                         $0.14                $0.10
                                                            =====                =====

</TABLE>

Earnings per share amounts have been adjusted for the effect of annual stock
dividends.
<TABLE>
<CAPTION>

                                                          Six Months Ended June 30,
                                                          2007                 2006
                                                         ----                ------
         Numerator:
<S>                                                    <C>                  <C>
              Net income                               $1,775,569           $1,737,305
                                                       ==========           ==========
         Denominator:
              Basic weighted-average
                shares outstanding                       7,047,167            6,914,441
                                                      -----------          -----------

         Effect of dilutive securities:
              Employee stock options                      244,292              134,946
              Stock appreciation rights                     --                   1,081
              Employee deferred compensation rights        14,843              --
                                                      -----------           ----------
         Dilutive potential common shares                 259,135              136,027
                                                      -----------           -----------
         Diluted weighted-average
            shares outstanding                          7,306,302            7,050,468
                                                      ===========          ===========

         Basic earnings per share                           $0.25                $0.25
                                                            =====                =====

         Diluted earnings per share                         $0.24                $0.25
                                                            =====                =====
</TABLE>


Earnings per share amounts have been adjusted for the effect of annual stock
dividends.


<PAGE>

<TABLE>
<CAPTION>

            SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                            June 30, 2007 (Unaudited)

6.  Business Segment
                                                         Life       Cemetery/                 Reconciling
                                                       Insurance    Mortuary     Mortgage        Items        Consolidated
                                                     -----------   ----------    --------    --------------   ------------
For the Three Months Ended
June 30, 2007
<S>                                                  <C>            <C>         <C>           <C>           <C>
Revenues from external customers                     $11,428,079    $4,347,795  $38,540,014   $             $54,315,888
                                                                                                                  --
Intersegment revenues                                  1,767,705        23,001      122,184     (1,912,890)       --

Segment profit (loss) before income taxes              1,039,469       588,153     (267,772)        --        1,359,850

For the Three Months Ended
June 30, 2006
Revenues from external customers                     $10,698,047    $3,452,483  $19,995,919   $             $34,146,449
                                                                                                                  --

Intersegment revenues                                  1,264,601        23,001      121,182     (1,408,784)       --

Segment profit (loss) before income taxes                947,324       233,273     (287,730)        --          892,867

For the Six Months Ended
June 30, 2007
Revenues from external customers                     $23,227,261    $8,127,011  $72,007,768   $     --      $103,362,040

Intersegment revenues                                  3,105,062        46,002      242,344     (3,393,408)        --

Segment profit (loss) before income taxes              1,645,114     1,018,730     (246,616)        --        2,417,228

Identifiable assets                                  359,542,165    58,490,187   22,721,012    (55,169,490)  85,583,874

For the Six Months Ended
June 30, 2006

Revenues from external customers                     $21,609,384    $6,769,172  $38,171,586   $     --       66,550,142

Intersegment revenues                                  2,654,467        46,002      212,618     (2,913,087)      --

Segment profit (loss) before income taxes              2,053,401       605,128     (463,505)        --        2,195,024

Identifiable assets                                  352,247,310    51,897,683   18,891,648    (56,761,440)  66,275,201

</TABLE>


<PAGE>


            SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                           June 30, 2007, (Unaudited)


7.   Other Business Activity

On March 5, 2007, the Company received a proposed consent order from the Florida
Office of Insurance  Regulation  concerning  the New Success Life  Program,  the
higher education  product currently being marketed and sold by Southern Security
Life. The proposed order states that as a result of an investigation the Florida
Office has determined  that Southern  Security Life violated  Florida law (i) by
knowingly making statements, sales presentations,  omissions or comparisons that
misrepresented  the  benefits,  advantages,  or  terms of the New  Success  Life
Program,  and  (ii)  by  knowingly  making,  advertisements,  announcements,  or
statements containing representations that were untrue or misleading.

The proposed order would require  Security  National Life and Southern  Security
Life to  immediately  cease and  desist  from  making  any  false or  misleading
representations  to  Florida  consumers  suggesting  that the New  Success  Life
Program would  accumulate  enough value to pay for college expenses in full. The
proposed order would also require Security  National Life and Southern  Security
Life to agree to no longer  market or sell the New Success  Life  Program in the
State of Florida. In addition, Security National Life and Southern Security Life
would be required to send a written  notice to Florida  consumers  who purchased
the New Success Life Program on or after January 1, 1998 stating that the higher
education  program is a whole life  insurance  product,  with a term and annuity
rider, and not a college trust fund, savings plan, or other program,  and it may
not necessarily pay college expenses in full from the accumulated value.

Moreover,  the  written  notice is to provide  an  opportunity  for the  Florida
consumers who purchased the New Success Life Program on or after January 1, 1998
to cancel their policy and be given a full refund,  including all premiums paid,
together with interest at the agreed upon rate in the original contract. If each
of the Florida  consumers  who  purchased  the New Success  Life  Program  after
January 1, 1998 was to cancel his or her policy and  receive a refund,  the cost
to the  Company  to refund  all  premiums  paid,  including  interest,  would be
approximately $8,200,000, an amount in excess of the assets of Southern Security
Life.

The  proposed  consent  order  would also  require  Security  National  Life and
Southern  Security  Life to  issue  refunds  including  interest  to the  eleven
policyholders  whose affidavits were taken in connection with the administrative
complaint that the Florida  Office had  previously  filed against Franz Wallace,
the former National Sales Director of Southern Security Life.  Security National
Life and Southern Security Life would additionally be required to issue refunds,
including interest,  to any Florida policyholder in the New Success Life Program
who had filed a complaint with the Florida  Department of Financial  Services or
whose  coverage had lapsed.  Furthermore,  Security  National  Life and Southern
Security Life would be required to notify the state insurance department in each
state in which the New  Success  Life  Program is  marketed of the order and any
complaint that Southern  Security Life received relating to the New Success Life
Program from  policyholders in that state.  Finally,  Security National Life and
Southern  Security Life would be required to pay the Florida Office a penalty of
$100,000 and administrative costs of $5,000.

The Company disputes the terms of the proposed consent order. The Company is not
aware of specific concerns that the Florida Office has with the New Success Life
Program  because it has received no specific  administrative  complaint from the
Florida Office nor is it aware of any recent market conduct examination that the
Florida  Office has conducted  relative to the program.  The Company  intends to
vigorously  oppose the proposed consent order. The Company is currently  engaged
in discussions with the Florida Office in an effort to settle the dispute


<PAGE>


            SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                           June 30, 2007, (Unaudited)


7.   Other Business Activity (continued)

concerning the proposed  order. If the Company is unable to reach a satisfactory
resolution  with the Florida  Office with  respect to the terms of the  proposed
consent order and the Florida Office issues a similar order, the Company intends
to take  action  necessary  to  protect  its  rights  and  interests,  including
requesting a hearing before an administrative law judge to oppose the order. The
Company  believes any potential  liability would be limited to the net assets of
Southern Security Life, which are approximately $3,914,000.

In June 2007,  the  Company  completed  the sale of the  Colonial  Funeral  Home
property to the Utopia Station  Development  Corp. for $730,242,  net of selling
costs of $44,758.  The Colonial Funeral Home ceased  operations in July 2006 and
has been  inactive  since  that  date.  The  carrying  amount  on the  Company's
financial statements on June 20, 2007 was $148,777.  As a result of the sale and
after the related selling expenses,  the Company  recognized a gain of $581,465.
The Company received a down payment of $15,242 with the remaining $715,000 to be
received in a lump sum within one year.  The gain has been included as a part of
Realized  Gains on  Investments  and  Other  Assets in the  Company's  condensed
consolidated statement of earnings.

8.   Subsequent Event

On July 16,  2007,  the  Company  completed  a purchase  transaction  with C & J
Financial, LLC, an Alabama limited liability company ("C & J Financial").  C & J
Financial  operates a factoring  business with offices in Rainbow City,  Alabama
with an emphasis on providing financing for funeral homes and mortuaries.  Under
the terms of the Unit Purchase  Agreement  dated July 16, 2007,  (the  "Purchase
Agreement")  among the Company,  C & J Financial,  Henry Culp, Jr.  ("Culp") and
Culp  Industries,  Inc. ("Culp  Industries"),  the Company  purchased all of the
outstanding member units of C & J Financial for a purchase  consideration of (i)
$1,250,000  in cash,  (ii) a  promissory  note from the  Company  to Culp in the
amount of $381,500  plus  interest at the rate of 5% per annum,  payable  over a
period of 24 months in monthly payments of $16,737,  including  interest,  until
paid in  full,  and  (iii) a quit  claim  deed  from C & J  Financial  to  Culp,
conveying  ownership  of the building and  surrounding  property  located in the
Jester Commercial Park in Rainbow City, Alabama, where C & J Financial currently
maintains its business offices. At closing, Culp Industries entered into a lease
agreement with C & J Financial to lease to C & J Financial  approximately  5,000
square feet in the building located at the Jester  Commercial Park. The lease is
for a term of three years for which C & J Financial,  as tenant,  is required to
make monthly payments of $1,200, for a total lease payment of $43,200.

The Purchase Agreement  additionally  required Culp to deliver to the Company at
closing a promissory  note (the "Note") in the  principal  amount of  $1,755,236
plus interest at the rate of 8.25% per annum from C & J Financial,  as borrower,
to Culp,  as lender,  with such note to be cancelled  and marked "paid in full".
Moreover,  the agreement  provides for the  possibility of  adjustments.  If the
total equity on the balance sheet of C & J Financial as of May 31, 2007, defined
as total  assets  minus  total  liabilities,  is greater  than the amount of the
equity on the balance  sheet of C & J Financial as of the closing  date, or July
16,  2007,  Culp agrees to pay to the Company the  difference  between the total
equity  on the  balance  sheet as of May 31,  2007 and the  total  equity on the
balance  sheet as of July 16,  2007 by  reducing  the amount of the Note by such
difference  in the amounts of the total  equity on such balance  sheets.  If the
amount of the total equity on the balance sheet of C & J Financial as of May 31,
2007 is less than the amount of the total  equity on the balance  sheet of C & J
Financial as of July 16,  2007,  the Company  agrees to pay Culp the  difference
between the total  equity on the balance  sheet as of May 31, 2007 and the total
equity on the balance sheet as of July 16, 2007 by increasing  the amount of the
Note  payable by such  difference  in the  amounts  of the total  equity on such
balance sheets.


<PAGE>


            SECURITY NATIONAL FINANCIAL CORPORATION AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                           June 30, 2007, (Unaudited)


The  Purchase  Agreement  further  requires  each  unitholder  to deliver to the
Company  a  non-competition  and  confidentiality   agreement   prohibiting  the
unitholder  from  competing with C & J Financial for a period of five years from
July 16, 2007 through  July 16,  2012.  The Company also entered into a one year
consulting  agreement  with  Culp,  which  requires  Culp to  provide  part-time
consulting  services  for C & J  Financial  at $50.00 per hour,  and a five year
employment  agreement  with Kevin O. Smith  ("Smith"),  Vice  President of C & J
Financial, who will continue to serve in that position. The employment agreement
requires  C & J  Financial  to pay Smith an  annual  salary  of  $96,000  plus a
discretionary bonus and a monthly car allowance of $1,161.

Finally, the Purchase Agreement requires the Company, C & J Financial,  Culp and
Culp  Industries  to  acknowledge  the  existence of a business  loan  agreement
between  Regions  Bank,  as lender,  and Culp  Industries,  as  borrower,  which
provides for a line of credit for C & J Financial.  The  outstanding  balance on
the line of credit  as of July 16,  2007 was  $1,931,764.  The line of credit is
secured by, among other assets,  the accounts  receivable of C & J Financial and
is personally  guaranteed by Culp.  The Company has received  confirmation  that
Regions Bank will not authorize  any further  advances or sweeps with respect to
the line of credit.  The  Company  agrees  that it will pay off the  outstanding
balance of the line of credit with Regions Bank  relating to the business of C &
J Financial. The Company will initially attempt to pay off the line of credit by
means of applying the payments  from the accounts  receivable of C & J Financial
as such payments are made in the ordinary course of business.

At June 30, 2007,  total  assets of C & J Financial  were  $3,197,000  and total
liabilities  were  $3,526,000,  which includes the Note to Culp in the amount of
$1,755,000  that was  cancelled  at  closing.  For the seven  month  period from
November  1,  2006 to May 31,  2007,  total  revenues  of C & J  Financial  were
$775,000 and total expenses were  $764,000,  resulting in net income of $11,000.
For the fiscal year ended  October 31, 2006,  total  revenues of C & J Financial
were $1,397,000 and total expenses were  $1,351,000,  resulting in net income of
$46,000.  For the fiscal year ended  October 31, 2005,  total  revenues of C & J
Financial were $1,137,000 and total expenses were  $1,114,000,  resulting in net
income  of  $23,000.  The  Company  anticipates   utilizing  the  employees  and
operations  of C & J  Financial  to expand its fast  funding  operations,  which
provide financing for funeral homes and mortuaries.



<PAGE>




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

Overview

The Company's  operations  over the last several years  generally  reflect three
trends or events which the Company expects to continue:  (i) increased attention
to "niche" insurance  products,  such as the Company's funeral plan policies and
traditional  whole-life  products;   (ii)  emphasis  on  cemetery  and  mortuary
business; and (iii) originating and refinancing mortgage loans.

Mortgage Operations

During the three months ended June 30, 2007,  Security National Mortgage Company
("SNMC")  experienced an increase in revenue and expenses due to the increase in
loan volume of its operations.  SNMC is a mortgage lender incorporated under the
laws of the State of Utah. SNMC is approved and regulated by the Federal Housing
Administration  (FHA), a department of the U.S.  Department of Housing and Urban
Development  (HUD),  to originate  mortgage  loans that  qualify for  government
insurance in the event of default by the borrower.  SNMC obtains loans primarily
from independent brokers and correspondents.  SNMC funds the loans from internal
cash flows and lines of credit from financial  institutions.  SNMC receives fees
from the  borrowers  and other  secondary  fees from third party  investors  who
purchase  the loans from SNMC.  SNMC  primarily  sells all of its loans to third
party  investors  and does not retain  servicing to these  loans.  SNMC pays the
brokers and  correspondents  a commission  for loans that are  brokered  through
SNMC.  SNMC originated and sold 10,755 loans  ($1,985,066,000  total volume) and
6,002 loans ($993,094,000 total volume),  respectively, for the six months ended
June 30, 2007 and 2006.

The mortgage industry is currently experiencing substantial change due to higher
than expected  delinquencies  from subprime  loans.  The market for new subprime
loans has been  substantially  reduced  and  several  mortgage  companies  whose
primary product was subprime mortgage  originations have ceased operations.  The
Company funded $4.2 million (.2% of the Company's  production) in subprime loans
during the six months ending June 30, 2007 and has currently eliminated subprime
loans from its product offerings. The Company believes that its potential losses
from subprime loans are minimal.

The industry  problem with subprime  mortgages has created a volatile  secondary
market for other high risk products,  especially alternative  documentation (Alt
A) loans.  Alt A loans are  typically  offered to qualified  borrowers  who have
relatively high credit scores but are not required to provide full documentation
to support  personal  income and  assets  owned.  Alt A loans can have a loan to
value ratio as high as 100%. There is currently a smaller market for Alt A loans
and the Company's warehouse line providers have shortened the allowable time for
the Company to sell these  products to investors.  As a result of these changes,
the Company is only offering these loans on a limited basis.

Alt A loans represented  approximately  21% of the Company's  production for the
six months  ended  June 30,  2007.  The  Company is  currently  experiencing  an
increase in production of its other mortgage  products.  This increased mortgage
production will offset some of the loss of income related to the  discontinuance
of Alt A loans.  As of August 13,  2007,  the Company had  originated a total of
$60,400,000  in Alt A loans  that  had not been  settled  by  investors.  If the
Company  were  unable to sell its Alt A loans it would be required to assume the
risk of holding and servicing such loans.  The Company  believes it has adequate
liquidity,  however,  through its life insurance  operations to carry such loans
until purchased by investors if warehousing lines are not available.


<PAGE>

The Company expects the current  mortgage market  conditions to continue for the
remainder  of  2007.  Under  these  circumstances  it is  difficult  to  predict
profitability.  Profitability  may be impacted by volume  reduction,  changes in
margins, increased borrowing costs and future loans losses. Management has taken
and will  continue  to take a number of  actions,  however,  in  response to the
changing  market  conditions.  These  include  offering Alt A loans on a limited
basis, closing unprofitable branch offices, obtaining new warehousing agreements
at a lower interest rates, and expense reduction  initiatives.

During the six months ending June 30, 2007, the Company  experienced loan losses
of  $2,459,000.  This amount was charged  against the provision for loan losses.
The balance of the reserve for loan losses at June 30, 2007 was $1,594,000.  The
Company adds  approximately  $165,000 per month to its loan loss  reserves.  The
Company  believes the loan loss  reserves  are  sufficient  to cover  reasonably
foreseeable  future  loan  losses  and  that its  formula  for  determining  the
provision for such reserves is adequate.

Results of Operations

Three Months Ended June 30, 2007 Compared to Three Months Ended June 30, 2006

Total revenues increased by $20,169,000,  or 59.1%, to $54,316,000 for the three
months ended June 30, 2007, from $34,147,000 for the three months ended June 30,
2006. Contributing to this increase in total revenues was a $15,149,000 increase
in mortgage  fee income,  a $503,000  increase in  insurance  premiums and other
considerations,  a $3,505,000 increase in investment income, a $280,000 increase
in net mortuary and cemetery sales, a $34,000 increase in other revenues,  and a
$698,000 increase in realized gains on investments and other assets.

Insurance premiums and other considerations  increased by $503,000,  or 6.8%, to
$7,906,000  for the three months ended June 30, 2007,  from  $7,403,000  for the
comparable  period in 2006.  This increase was  primarily due to the  additional
premiums realized from new insurance sales.

Net investment  income increased by $3,505,000,  or 63.7%, to $9,009,000 for the
three months ended June 30, 2007, from  $5,504,000 for the comparable  period in
2006.  This increase was primarily  attributable  to additional  interest income
from increased  long-term bond and mortgage purchases over the comparable period
in 2006.

Net mortuary and cemetery  sales  increased by $280,000,  or 8.9%, to $3,434,000
for the three months ended June 30, 2007,  from  $3,154,000  for the  comparable
period in 2006. This increase was due to increased at-need sales in the cemetery
and  mortuary  operations  and  increased  pre-need  land sales in the  cemetery
operations.

Realized gains on investments and other assets increased by $698,000,  or 1,163%
to  $758,000  for the three  months  ended June 30,  2007 from  $60,000  for the
comparable period in 2006. This was primarily due to a gain of $581,000 from the
sale of Colonial Funeral Home in Salt Lake City.

Mortgage fee income  increased by $15,149,000,  or 84.5%, to $33,079,000 for the
three months ended June 30, 2007, from $17,930,000 for the comparable  period in
2006.  This increase was primarily  attributable to an increase in the number of
loan originations during the second quarter of 2007 as new mortgage offices were
opened and production increased in existing mortgage offices,  which resulted in
the financing of a greater number of mortgage loans.


<PAGE>

Other revenues increased by $34,000, or 35.8% to $129,000,  for the three months
ended  June 30,  2007 from  $95,000  for the  comparable  period  in 2006.  This
increase  was due to increases in several  small  income  items  throughout  the
Company's operations.

Total benefits and expenses were  $52,956,000,  or 97.5% of total revenues,  for
the three months ended June 30, 2007,  as compared to  $33,254,000,  or 97.4% of
total  revenues,  for the  comparable  period in 2006.  This increase  primarily
resulted from increased loan costs at SecurityNational Mortgage Company due to a
greater number of loan originations.

Death  benefits,  surrenders and other policy  benefits,  and increase in future
policy  benefits  increased by an aggregate of $483,000,  or 6.9%, to $7,476,000
for the three months ended June 30, 2007,  from  $6,993,000  for the  comparable
period in 2006. This increase was primarily due to increased  insurance business
and to the  expected  increase in reserves for  policyholder  benefits and death
claims.

Amortization  of  deferred  policy and  pre-need  acquisition  costs and cost of
insurance acquired increased by $605,000,  or 79.8%, to $1,363,000 for the three
months ended June 30, 2007,  from  $758,000 for the  comparable  period in 2006.
This  increase  was  primarily  due  to  increased  deferred  acquisition  costs
associated with interest sensitive products and pre-need cemetery contracts.

General and  administrative  expenses  increased by  $15,454,000,  or 64.8%,  to
$39,296,000 for the three months ended June 30, 2007,  from  $23,843,000 for the
comparable period in 2006. This increase  primarily resulted from an increase in
commission  expenses of $11,169,000,  from $13,686,000 in 2006 to $24,855,000 in
2007,  due  to  a  greater  number  of  mortgage  loan   originations   made  by
SecurityNational  Mortgage  Company during the second quarter of 2007.  Salaries
increased by $1,655,000 from $4,247,000 in 2006 to $5,902,000 in 2007, primarily
due to merit increases in salaries of existing employees, and an increase in the
number of employees necessitated by the Company's expanding business operations.
Other expenses  increased by $2,629,000 from $5,910,000 in 2006 to $8,539,000 in
2007.  The increase in other  expenses  primarily  resulted from  increased loan
costs at  SecurityNational  Mortgage  Company  due to a  greater  number of loan
originations.

Interest expense increased by $3,070,000, or 282.3%, to $4,158,000 for the three
months ended June 30, 2007, from  $1,088,000 for the comparable  period in 2006.
This increase was primarily due to increased  warehouse lines of credit required
for a greater number of warehoused mortgage loans by  SecurityNational  Mortgage
Company.

Cost of goods and services sold of the mortuaries  and  cemeteries  increased by
$91,000,  or 15.8%,  to $663,000 for the three months ended June 30, 2007,  from
$572,000 for the comparable  period in 2006.  This increase was primarily due to
increased at-need cemetery sales.

Six Months Ended June 30, 2007 Compared to Six Months Ended June 30, 2006

Total revenues  increased by $36,812,000,  or 55.3%, to $103,362,000 for the six
months ended June 30, 2007,  from  $66,550,000 for the six months ended June 30,
2006. Contributing to this increase in total revenues was a $28,042,000 increase
in mortgage  fee income,  a $911,000  increase in  insurance  premiums and other
considerations,  a $6,373,000 increase in investment income, a $736,000 increase
in net mortuary and cemetery sales, a $71,000 increase in other revenues,  and a
$679,000 increase in realized gains on investments and other assets.

Insurance premiums and other considerations  increased by $911,000,  or 6.1%, to
$15,869,000  for the six months ended June 30, 2007,  from  $14,958,000  for the
comparable  period in 2006.  This increase was  primarily due to the  additional
insurance premiums realized from new insurance sales.


<PAGE>

Net investment income increased by $6,373,000,  or 60.2%, to $16,952,000 for the
six months ended June 30, 2007, from  $10,579,000  for the comparable  period in
2006.  This increase was primarily  attributable  to additional  interest income
from increased  long-term bond and mortgage purchases over the comparable period
in 2006.

Net mortuary and cemetery sales  increased by $736,000,  or 11.9%, to $6,945,000
for the six months  ended June 30,  2007,  from  $6,209,000  for the  comparable
period in 2006. This increase was due to increased at-need sales in the cemetery
and  mortuary   operations  and  increased   pre-need  land  sales  in  cemetery
operations.

Realized  gains on  investments  and other  assets  increased  by  $679,000,  or
1,170.7%,  to $737,000  for the six months  ended June 30, 2007 from $58,000 for
the  comparable  period in 2006.  This was  primarily  due to a one time gain of
$581,000 from the sale of Colonial Funeral Home in Salt Lake City.

Mortgage fee income  increased by $28,042,000,  or 81.1%, to $62,601,000 for the
six months ended June 30, 2007, from  $34,559,000  for the comparable  period in
2006.  This increase was primarily  attributable to an increase in the number of
loan  originations  during the six months of 2006 as new  mortgage  offices were
opened and production increased in existing mortgage offices,  which resulted in
the financing of a greater number of mortgage loans.

Other revenues  increased by $71,000,  or 38.0%,  to $258,000 for the six months
ended  June 30,  2007 from  $187,000  for the  comparable  period in 2006.  This
increase  was due to increases in several  small  income  items  throughout  the
Company's operations.

Total benefits and expenses were $100,945,000,  or 97.7% of total revenues,  for
the six months  ended June 30,  2007,  as compared to  $64,355,000,  or 96.7% of
total  revenues,  for the  comparable  period in 2006.  This increase  primarily
resulted from increased loan costs at SecurityNational Mortgage Company due to a
greater number of loan originations.

Death  benefits,  surrenders and other policy  benefits,  and increase in future
policy benefits increased by an aggregate of $1,185,000, or 8.6%, to $14,920,000
for the six months  ended June 30, 2007,  from  $13,735,000  for the  comparable
period in 2006. This increase was primarily due to increased  insurance business
and to the  expected  increase in reserves for  policyholder  benefits and death
claims.

Amortization  of  deferred  policy and  pre-need  acquisition  costs and cost of
insurance acquired increased by $1,158,000,  or 74.0%, to $2,723,000 for the six
months ended June 30, 2007, from  $1,565,000 for the comparable  period in 2006.
This  increase  was  primarily  due  to  increased  deferred  acquisition  costs
associated  with  interest-sensitive  products  from the  recapture  of the Mega
reinsurance  agreement  in the first  quarter  of 2006,  and  pre-need  cemetery
contracts.

General and  administrative  expenses  increased by  $28,990,000,  or 63.4%,  to
$74,729,000  for the six months ended June 30, 2007,  from  $45,739,000  for the
comparable period in 2006. This increase  primarily resulted from an increase in
commission  expenses by $21,247,000  from  $26,048,000 in 2006 to $47,295,000 in
2007,  due  to  a  greater  number  of  mortgage  loan   originations   made  by
SecurityNational  Mortgage Company during the first six months of 2007. Salaries
increased  by  $3,197,000  from  $8,490,000  in 2006  to  $11,687,000  in  2007,
primarily  due to merit  increases  in salaries of  existing  employees,  and an
increase in the number of  employees  necessitated  by the  Company's  expanding
business operations.  Other expenses increased by $4,546,000 from $11,201,000 in
2006 to $15,747,000 in 2007. The increase in other expenses  primarily  resulted
from increased loan costs at SecurityNational  Mortgage Company due to a greater
number of loan originations.

Interest expense  increased by $5,149,000,  or 244.3%, to $7,257,000 for the six
months ended June 30, 2007, from  $2,108,000 for the comparable  period in 2006.
This increase was primarily from increased  warehouse  lines of credit  required
for a greater number of warehoused mortgage loans by  SecurityNational  Mortgage
Company.


<PAGE>


Cost of goods and services sold by the mortuaries  and  cemeteries  increased by
$107,000,  or 8.9%, to $1,315,000  for the six months ended June 30, 2007,  from
$1,208,000 for the comparable period in 2006. This increase was primarily due to
increased cemetery and mortuary sales.

Liquidity and Capital Resources

The Company's life insurance subsidiaries and cemetery and mortuary subsidiaries
realize  cash flow  from  premiums,  contract  payments  and  sales on  personal
services  rendered  for  cemetery  and  mortuary  business,  from  interest  and
dividends  on  invested  assets,  and from the  proceeds  from the  maturity  of
held-to-maturity   investments  or  sale  of  other  investments.  The  mortgage
subsidiary realizes cash flow from fees generated by originating and refinancing
mortgage loans and interest  earned on mortgages sold to investors.  The Company
considers these sources of cash flow to be adequate to fund future  policyholder
and  cemetery and mortuary  liabilities,  which  generally  are  long-term,  and
adequate to pay current policyholder claims,  annuity payments,  expenses on the
issuance of new policies,  the maintenance of existing  policies,  debt service,
and to meet operating expenses.

During the six months ended June 30, 2007, the Company's operations used cash of
$15,414,000,  while cash totaling  $12,926,000 was provided by operations during
the six months  ended June 30,  2006.  This is due to an increase in the accrual
for mortgage  loans sold to investors of  $21,651,000,  which is attributed to a
higher  mortgage  loan volume for the first six months of 2007  versus  mortgage
loan  volume  during the first six months of 2006.  The  increase in the accrual
resulted from an increase in mortgage  loans  originated  but not yet settled by
investors as of June 30, 2007.

The  Company  attempts  to  match  the  duration  of  invested  assets  with its
policyholder  and  cemetery  and  mortuary  liabilities.  The  Company  may sell
investments other than those  held-to-maturity  in the portfolio to help in this
timing;  however,  to date, that has not been necessary.  The Company  purchases
short-term  investments  on a  temporary  basis  to  meet  the  expectations  of
short-term requirements of the Company's products.

The  Company's  investment  philosophy  is intended to provide a rate of return,
which will persist during the expected duration of policyholder and cemetery and
mortuary liabilities regardless of future interest rate movements.

The Company's  investment  policy is to invest  predominantly  in fixed maturity
securities,  mortgage  loans,  and warehousing of mortgage loans on a short-term
basis before selling the loans to investors in accordance with the  requirements
and laws governing the life insurance subsidiaries. Bonds owned by the insurance
subsidiaries   amounted  to  $97,514,000  as  of  June  30,  2007,  compared  to
$101,735,000  as of December 31, 2006.  This  represents  48.6% and 46.8% of the
total  investments  as of June 30, 2007,  and  December 31, 2006,  respectively.
Generally,  all bonds owned by the life insurance  subsidiaries are rated by the
National Association of Insurance Commissioners. Under this rating system, there
are six  categories  used for rating bonds.  At June 30, 2007 0.9% (or $893,000)
and at December 31,  2006,  2.3% (or  $2,402,000)  of the  Company's  total bond
investments were invested in bonds in rating categories three through six, which
are considered non-investment grade.

The Company has  classified  certain of its fixed income  securities,  including
high-yield  securities,  in its  portfolio  as  available  for  sale,  with  the
remainder  classified as held to maturity.  However,  in accordance with Company
policy,  any such securities  purchased in the future will be classified as held
to maturity.  Business conditions,  however, may develop in the future which may
indicate a need for a higher level of liquidity in the investment portfolio.  In
that event the  Company  believes  it could  sell  short-term  investment  grade
securities before liquidating higher-yielding longer-term securities.

The Company is subject to risk based capital guidelines established by statutory
regulators  requiring  minimum  capital  levels based on the  perceived  risk of
assets, liabilities, disintermediation, and business risk. At June 30, 2007, and
December  31,  2006,  the life  insurance  subsidiary  exceeded  the  regulatory
criteria.


<PAGE>


The Company's total  capitalization of stockholders'  equity,  and bank debt and
notes payable was $63,972,000 as of June 30, 2007, as compared to $60,641,000 as
of December 31, 2006.  Stockholders' equity as a percent of total capitalization
was 86 % and 87% as of June 30, 2007 and December 31, 2006, respectively.

Lapse  rates  measure the amount of  insurance  terminated  during a  particular
period. The Company's lapse rate for life insurance in 2006 was 8.4% as compared
to a rate of 7.9% for 2005.  The 2007 lapse rate to date has been  approximately
the same as 2006.

At June 30, 2007, $19,497,000 of the Company's consolidated stockholders' equity
represents  the statutory  stockholders'  equity of the Company's life insurance
subsidiaries.  The life  insurance  subsidiaries  cannot pay a  dividend  to its
parent company without the approval of insurance regulatory authorities.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

There have been no  significant  changes since the annual report Form 10-K filed
for the year ended December 31, 2006.

Item 4.   Controls and Procedures

     (a)  Evaluation  of  disclosure  controls and  procedures  - The  Company's
principal  executive  officer and principal  financial officer have reviewed and
evaluated the effectiveness of the Company's  disclosure controls and procedures
(as defined in Rule 13a-15(e) or 15d-15(e) under the Securities  Exchange Act of
1934 (the "Exchange  Act") as of June 30, 2007.  Based on that  evaluation,  the
principal  executive officer and the principal  financial officer have concluded
that the Company's  disclosure controls and procedures are effective,  providing
them with  material  information  relating  to the  Company  as  required  to be
disclosed in the reports the Company  files or submits under the Exchange Act on
a timely basis.

     (b) Changes in internal controls - There were no significant changes in the
Company's  internal  controls over financial  reporting or in other factors that
could  significantly  affect the  Company's  internal  controls  and  procedures
subsequent  to the date of their  most  recent  evaluation,  nor were  there any
significant  deficiencies  or  material  weaknesses  in the  Company's  internal
controls. As a result, no corrective actions were required or undertaken.


                            Part II Other Information

Item 1.  Legal Proceedings

On March 5, 2007, the Company received a proposed consent order from the Florida
Office of Insurance  Regulation  concerning  the New Success Life  Program,  the
higher education  product currently being marketed and sold by Southern Security
Life. The proposed order states that as a result of an investigation the Florida
Office has determined  that Southern  Security Life violated  Florida law (i) by
knowingly making statements, sales presentations,  omissions or comparisons that
misrepresented  the  benefits,  advantages,  or  terms of the New  Success  Life
Program,  and  (ii)  by  knowingly  making,  advertisements,  announcements,  or
statements containing representations that were untrue or misleading.


<PAGE>


The proposed order would require  Security  National Life and Southern  Security
Life to  immediately  cease and  desist  from  making  any  false or  misleading
representations  to  Florida  consumers  suggesting  that the New  Success  Life
Program would  accumulate  enough value to pay for college expenses in full. The
proposed order would also require Security  National Life and Southern  Security
Life to agree to no longer  market or sell the New Success  Life  Program in the
State of Florida. In addition, Security National Life and Southern Security Life
would be required to send a written  notice to Florida  consumers  who purchased
the New Success Life Program on or after January 1, 1998 stating that the higher
education  program is a whole life  insurance  product,  with a term and annuity
rider, and not a college trust fund, savings plan, or other program,  and it may
not necessarily pay college expenses in full from the accumulated value.

Moreover,  the  written  notice is to provide  an  opportunity  for the  Florida
consumers who purchased the New Success Life Program on or after January 1, 1998
to cancel their policy and be given a full refund,  including all premiums paid,
together with interest at the agreed upon rate in the original contract. If each
of the Florida  consumers  who  purchased  the New Success  Life  Program  after
January 1, 1998 was to cancel his or her policy and  receive a refund,  the cost
to the  Company  to refund  all  premiums  paid,  including  interest,  would be
approximately $8,200,000, an amount in excess of the assets of Southern Security
Life.

The  proposed  consent  order  would also  require  Security  National  Life and
Southern  Security  Life to  issue  refunds  including  interest  to the  eleven
policyholders  whose affidavits were taken in connection with the administrative
complaint that the Florida  Office had  previously  filed against Franz Wallace,
the former National Sales Director of Southern Security Life.  Security National
Life and Southern Security Life would additionally be required to issue refunds,
including interest,  to any Florida policyholder in the New Success Life Program
who had filed a complaint with the Florida  Department of Financial  Services or
whose  coverage had lapsed.  Furthermore,  Security  National  Life and Southern
Security Life would be required to notify the state insurance department in each
state in which the New  Success  Life  Program is  marketed of the order and any
complaint that Southern  Security Life received relating to the New Success Life
Program from  policyholders in that state.  Finally,  Security National Life and
Southern  Security Life would be required to pay the Florida Office a penalty of
$100,000 and administrative costs of $5,000.

The Company disputes the terms of the proposed consent order. The Company is not
aware of specific concerns that the Florida Office has with the New Success Life
Program  because it has received no specific  administrative  complaint from the
Florida Office nor is it aware of any recent market conduct examination that the
Florida  Office has conducted  relative to the program.  The Company  intends to
vigorously  oppose the proposed consent order. The Company is currently  engaged
in  discussions  with the  Florida  Office in an effort  to settle  the  dispute
concerning the proposed  order. If the Company is unable to reach a satisfactory
resolution  with the Florida  Office with  respect to the terms of the  proposed
consent order and the Florida Office issues a similar order, the Company intends
to take  action  necessary  to  protect  its  rights  and  interests,  including
requesting a hearing before an administrative law judge to oppose the order. The
Company  believes any potential  liability would be limited to the net assets of
Southern Security Life, which are approximately $3,914,000.

Except for the  proposed  consent  order from the  Florida  Office of  Insurance
Regulation, the Company is not a party to any material legal proceedings outside
the  ordinary  course of business or to any other  legal  proceedings,  which if
adversely  determined,  would have a material  adverse  effect on its  financial
condition or results of operation.

Item 1A  Risk Factors

Due to changes in the mortgage industry from higher than expected  delinquencies
in  subprime  loans,   the  Company  may  be  unable  to  sell  its  alternative
documentation loans to investors,  which would require the Company to assume the
risk of holding and servicing such loans.


<PAGE>

The mortgage industry is currently experiencing substantial change due to higher
than expected  delinquencies  from subprime  loans.  The market for new subprime
loans has been  substantially  reduced  and  several  mortgage  companies  whose
primary product was subprime mortgage  originations have ceased operations.  The
Company funded $4.2 million (.2% of the Company's  production) in subprime loans
during the six months ending June 30, 2007 and has currently eliminated subprime
loans from its product offerings. The Company believes that its potential losses
from subprime loans are minimal.

The industry  problem with subprime  mortgages has created a volatile  secondary
market for other high risk products,  especially alternative  documentation (Alt
A) loans.  Alt A loans are  typically  offered to qualified  borrowers  who have
relatively high credit scores but are not required to provide full documentation
to support  personal  income and  assets  owned.  Alt A loans can have a loan to
value ratio as high as 100%. There is currently a smaller market for Alt A loans
and the Company's warehouse line providers have shortened the allowable time for
the Company to sell these  products to investors.  As a result of these changes,
the Company is only offering these loans on a limited basis.

Alt A loans represented  approximately  21% of the Company's  production for the
six months  ended  June 30,  2007.  The  Company is  currently  experiencing  an
increase in production of its other mortgage  products.  This increased mortgage
production will offset some of the loss of income related to the  discontinuance
of Alt A loans.  As of August 13,  2007,  the Company had  originated a total of
$60,400,000  in Alt A loans  that  had not been  settled  by  investors.  If the
Company  were  unable to sell its Alt A loans it would be required to assume the
risk of holding and servicing such loans.  The Company  believes it has adequate
liquidity,  however,  through its life insurance  operations to carry such loans
until purchased by investors if warehousing lines are not available.

Item 2.   Changes in Securities and Use of Proceeds

          None

Item 3.   Defaults Upon Senior Securities

          None

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

          None

Item 5.   Other Information

Acquisition of C & J Financial, LLC

     On July 16, 2007, the Company  completed a purchase  transaction with C & J
     Financial, LLC, an Alabama limited liability company ("C & J Financial"). C
     & J Financial  operates a factoring  business with offices in Rainbow City,
     Alabama  with an  emphasis on  providing  financing  for funeral  homes and
     mortuaries.  Under the terms of the Unit Purchase  Agreement dated July 16,
     2007 (the "Purchase  Agreement") among the Company, C & J Financial,  Henry
     Culp, Jr.  ("Culp") and Culp  Industries,  Inc.  ("Culp  Industries"),  the
     Company  purchased all of the  outstanding  member units of C & J Financial
     for a purchase consideration of (i) $1,250,000 in cash, (ii) a

<PAGE>

     promissory  note from the  Company to Culp in the amount of  $381,500  plus
     interest at the rate of 5% per annum, payable over a period of 24 months in
     monthly payments of $16,737,  including  interest,  until paid in full, and
     (iii) a quit claim deed from C & J Financial to Culp,  conveying  ownership
     of the building and surrounding  property located in the Jester  Commercial
     Park in Rainbow City,  Alabama,  where C & J Financial  currently maintains
     its business  offices.  At closing,  Culp  Industries  entered into a lease
     agreement  with C & J Financial  to lease to C & J Financial  approximately
     5,000 square feet in the building  located at the Jester  Commercial  Park.
     The  lease is for a term of  three  years  for  which C & J  Financial,  as
     tenant,  is required to make monthly payments of $1,200,  for a total lease
     payment of $43,200.

     The Purchase Agreement additionally required Culp to deliver to the Company
     at  closing a  promissory  note (the  "Note")  in the  principal  amount of
     $1,755,236  plus  interest  at the  rate  of  8.25%  per  annum  from C & J
     Financial,  as borrower, to Culp, as lender, with such note to be cancelled
     and  marked  "paid in  full".  Moreover,  the  agreement  provides  for the
     possibility of adjustments. If the total equity on the balance sheet of C &
     J  Financial  as of May 31,  2007,  defined  as total  assets  minus  total
     liabilities,  is greater than the amount of the equity on the balance sheet
     of C & J Financial as of the closing date, or July 16, 2007, Culp agrees to
     pay to the Company the  difference  between the total equity on the balance
     sheet as of May 31, 2007 and the total  equity on the  balance  sheet as of
     July 16, 2007 by reducing the amount of the Note by such  difference in the
     amounts of the total  equity on such balance  sheets.  If the amount of the
     total equity on the balance  sheet of C & J Financial as of May 31, 2007 is
     less  than the  amount of the total  equity on the  balance  sheet of C & J
     Financial  as of  July  16,  2007,  the  Company  agrees  to pay  Culp  the
     difference between the total equity on the balance sheet as of May 31, 2007
     and the total equity on the balance sheet as of July 16, 2007 by increasing
     the amount of the Note  payable by such  difference  in the  amounts of the
     total equity on such balance sheets.

     The Purchase  Agreement  further requires each unitholder to deliver to the
     Company a non-competition  and  confidentiality  agreement  prohibiting the
     unitholder  from  competing with C & J Financial for a period of five years
     from July 16, 2007 through  July 16, 2012.  The Company also entered into a
     one year  consulting  agreement  with Culp,  which requires Culp to provide
     part-time consulting services for C & J Financial at $50.00 per hour, and a
     five  year  employment  agreement  with  Kevin  O.  Smith  ("Smith"),  Vice
     President of C & J Financial,  who will continue to serve in that position.
     The  employment  agreement  requires C & J Financial to pay Smith an annual
     salary of $96,000 plus a discretionary bonus and a monthly car allowance of
     $1,161.

     Finally, the Purchase Agreement requires the Company, C & J Financial, Culp
     and Culp  Industries  to  acknowledge  the  existence  of a  business  loan
     agreement  between  Regions  Bank,  as  lender,  and  Culp  Industries,  as
     borrower,  which  provides  for a line of credit for C & J  Financial.  The
     outstanding  balance  on the  line  of  credit  as of  July  16,  2007  was
     $1,931,764.  The line of credit is secured  by,  among  other  assets,  the
     accounts  receivable  of C & J Financial  and is  personally  guaranteed by
     Culp.  The Company has  received  confirmation  that  Regions Bank will not
     authorize  any  further  advances  or sweeps  with  respect  to the line of
     credit. The Company agrees that it will pay off the outstanding  balance of
     the line of credit with  Regions  Bank  relating  to the  business of C & J
     Financial. The Company will initially attempt to pay off the line of credit
     by means of applying the payments  from the  accounts  receivable  of C & J
     Financial as such payments are made in the ordinary course of business.

     At June 30, 2007, total assets of C & J Financial were $3,197,000 and total
     liabilities were $3,526,000,  which includes the Note to Culp in the amount
     of  $1,755,000  that was  cancelled at closing.  For the seven month period
     from  November 1, 2006 to May 31, 2007,  total  revenues of C & J Financial
     were $775,000 and total expenses were $764,000,  resulting in net income of
     $11,000.  For the fiscal year ended October 31, 2006, total revenues of C &
     J Financial were $1,397,000 and total expenses were  $1,351,000,  resulting
     in net income of $46,000. For the fiscal year ended October 31, 2005, total
     revenues  of C & J  Financial  were  $1,137,000  and  total  expenses  were
     $1,114,000,  resulting  in net income of $23,000.  The Company  anticipates
     utilizing  the  employees  and  operations of C & J Financial to expand its
     fast funding  operations,  which  provide  financing  for funeral homes and
     mortuaries.


<PAGE>

Exercise of Stock Options and Special Stockholders Meeting

The  Company's  Board of  Directors  granted  stock  options in 2004 to Scott M.
Quist, the Company's  President and Chief Operating  Officer,  to purchase up to
1,000,000  shares of Class C common  stock at exercise  prices of $.323 and $.36
per share.  On May 31, 2007, Mr. Quist made a cashless  exercise of such options
to  purchase  a total of  1,157,625  shares of Class C common  stock that he was
entitled to receive,  after  adjustments for 5% stock dividends  issued in 2005,
2006 and 2007.

In connection with the exercise of such options on a cashless basis, Mr. Quist
delivered a total of 58,376 shares of Class A common stock to the Company that
he held in exchange for all the Class C shares he would be entitled to receive
for exercising the options. Inasmuch as there were 6,966,849 shares of Class C
common stock outstanding as of May 31, 2007 out of a total of 7,500,000
authorized shares of Class C common stock, the Company could legally issue only
533,151 shares of Class C common stock to Mr. Quist, leaving a balance of
624,474 Class C common shares owing to him.

In order to issue the  additional  shares of Class C common  shares owing to Mr.
Quist,  the Board of  Directors  approved on July 13, 2007 an  amendment  to the
Company's  Articles of  Incorporation  to increase  the number of Class C common
shares from 7,500,000 shares to 15,000,000 shares.  Because stockholder approval
is also required to amend the Company's  Articles of Incorporation,  the Company
has  scheduled a special  stockholders  meeting on September 21, 2007 to approve
the  amendment  to the  Articles  of  Incorporation  to  increase  the number of
authorized  shares of Class C common stock from  7,500,000  shares to 15,000,000
shares.

If the stockholders approve the amendment at the special  stockholders  meeting,
the Company will issue Mr. Quist the additional 624,474 shares of Class C common
stock that are owed pursuant to his exercise of stock options.  If the amendment
is  not  approved  at  the  special  stockholders  meeting,  the  Company  will,
alternatively,   issue  Mr.  Quist  62,487  shares  of  Class  A  common  stock,
representing 10% of the 624,474 Class C common shares that are owed to Mr. Quist
based on the conversion  ratio set forth in the Articles of Incorporation of one
share of Class A common stock for each ten shares of Class C common stock. As of
June 30,  2007,  the  Company  has  recorded  the fair  value of the  derivative
liability in the amount of $175,700 to reflect the Company's obligation to issue
the shares of Class C common stock or,  alternatively,  shares of Class A common
stock owed to Mr.  Quist  pursuant to the  exercise of the stock  options.  This
liability  is  included  in  other  liabilities  and  accrued  expenses  in  the
accompanying condensed consolidated balance sheet.

Item 6. Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a)(1) Financial Statements

         See "Table of Contents - Part I - Financial Information" under page 2
above

(a)(2) Financial Statement Schedules

       None

          All other schedules to the consolidated  financial statements required
          by Article 7 of  Regulation  S-X are not  required  under the  related
          instructions or are inapplicable and therefore have been omitted.


<PAGE>



    (3)  Exhibits

          The  following  Exhibits  are filed  herewith  pursuant to Rule 601 of
          Regulation S-K or are incorporated by reference to previous filings.

      3.1     Articles of Restatement of Articles of Incorporation (4)
      3.2     Amended Bylaws (6)
      4.1     Specimen Class A Stock Certificate (1)
      4.2     Specimen Class C Stock Certificate (1)
      4.3     Specimen Preferred Stock Certificate and Certificate of
              Designation of Preferred Stock (1)
     10.1     Restated and Amended Employee Stock Ownership Plan and Trust
              Agreement (1)
     10.2     2003 Stock Option Plan (5)
     10.3     2006 Director Stock Option Plan
     10.4     Deferred Compensation Agreement with George R. Quist (2)
     10.5     Deferred Compensation Plan (3)
     10.6     Employment agreement with J. Lynn Beckstead, Jr. (7)
     10.7     Employment agreement with Scott M. Quist (8)
     10.8     Stock Purchase Agreement among Security National Life Insurance
              Company, Southern Security Life Insurance Company, Memorial
              Insurance Company of America, and the shareholders of Memorial
              Insurance Company (9)
     10.9     Reinsurance Agreement between Security National Life Insurance
              Company  and  Memorial Insurance Company of America (10)
    10.10     Trust Agreement between Security National Life Insurance Company
              and Memorial  Insurance Company of America (10)
    10.11     Promissory Note between Memorial Insurance Company as Maker and
              Security National Life Insurance Company as Payee (10)
    10.12     Security Agreement between Memorial Insurance Company as Debtor
              and Security National Life Insurance Company as Secured Party (10)
    10.13     Surplus  Contribution  Note  between  Memorial  Insurance
              Company of America as Maker and Southern Security Life Insurance
              Company as Payee (10)
    10.14     Guaranty  Agreement by Security  National Life Insurance  Company
              and Southern Security Life Insurance Company as Guarantors (10)
    10.15     Administrative Services Agreement between Security  National Life
              Insurance Company and Memorial Insurance Company of America (10)
    10.16     Reinsurance Agreement between Security National Life Insurance
              Company and Southern Security Life Insurance Company (11)
    10.17     Trust Agreement among Security National Life Insurance Company,
              Southern Security Life Insurance Company and Zions First National
              Bank (11)
    10.18     Stock Purchase Agreement among Security National Life Insurance
              Company, Southern Security Life Insurance Company and American
              Network Insurance Company (12)
    10.19     Escrow Agreement among Security National Life Insurance Company,
              Southern Security Life Insurance Company, American Network
              Insurance Company and Mackey Price Thompson & Ostler (12)
    10.20     Escrow Agreement among American Network Insurance Company,
              Security National Life Insurance Company, Southern Security Life
              Insurance  Company,  and  Preferred  Insurance  Capital
              Consultants, LLC (12)
    10.21     Agreement and Plan of Complete Liquidation of Southern Security
              Life Insurance Company into Security National Life Insurance
              Company (12)
    10.22     Assignment  between Southern Security Life Insurance Company and
              Security National Life Insurance Company (12)
    10.23     Assignment between Southern Security Life Insurance Company and
              Security  National Life Insurance Company (12)
    10.24     Unit Purchase Agreement among Security National Financial
              Corporation,  C&J Financial,  LLC, Henry Culp, Jr., and Culp
              Industries, Inc. (13)


<PAGE>

     31.1     Certification pursuant to 18 U.S.C. Section 1350, as
              enacted  by  Section 302 of  the Sarbanes-Oxley Act of 2002
     31.2     Certification pursuant to 18 U.S.C. Section  1350, as enacted by
              Section 302 of the Sarbanes-Oxley Act of 2002
     32.1     Certification pursuant to 18 U.S.C. Section 1350, as adopted
              pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
     32.2     Certification  pursuant to 18 U.S.C. Section 1350, as adopted
              pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
      ----------

      (1)     Incorporated by reference from Registration Statement on Form S-1,
              as filed on June 29, 1987
      (2)     Incorporated by reference from Annual Report on Form 10-K, as
              filed on June 30, 1989
      (3)     Incorporated by reference from Annual Report on Form 10-K, as
              filed on April 3, 2002
      (4)     Incorporated by reference from Report on Form 8-K/A as filed on
              January 8, 2003
      (5)     Incorporated by reference from Schedule 14A Definitive Proxy
              Statement, Filed on June 5, 2003, relating to the Company's Annual
              Meeting of Shareholders
      (6)     Incorporated by reference from Report on Form 10-Q, as filed on
              November 14, 2003
      (7)     Incorporated by reference from Report on Form 10-K, as filed
              on March 30, 2004
      (8)     Incorporated by reference from Report on Form 10-Q, as filed on
              August 13, 2004
      (9)     Incorporated by reference from Report on Form 8-K, as filed on
              September 27, 2005
     (10)     Incorporated by reference from Report on Form 8-K, as filed on
              January 5, 2006
     (11)     Incorporated by reference from Report on Form 8-K, as filed on
              January 11, 2006
     (12)     Incorporated by reference from Report on Form 8-K, as filed on
              January 12, 2007
     (13)     Incorporated by reference from Report on Form 8-K, as filed on
              August 8, 2007

    (b) Reports on Form 8-K:

          No reports were filed by the Company during the quarter ended June 30,
          2007.


<PAGE>

                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                                   REGISTRANT

                     SECURITY NATIONAL FINANCIAL CORPORATION
                                   Registrant


Dated: August 14, 2007                 By:  s/s George R. Quist
                                            ---------------------
                                            George R. Quist
                                            Chairman of the Board and Chief
                                            Executive Officer
                                           (Principal Executive Officer)


Dated: August 14, 2007                 By:  s/s Stephen M. Sill
                                            ---------------------
                                            Stephen M. Sill
                                            Vice President, Treasurer and Chief
                                            Financial Officer
                                            (Principal Financial and Accounting
                                            Officer)

<PAGE>


                                  Exhibit 31.1

                            CERTIFICATION PURSUANT TO
                               18 U.S.C. ss. 1350,
                                  AS ENACTED BY
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002


I, George R. Quist, certify that:

1. I have  reviewed  this  quarterly  report on Form 10-Q of  Security  National
Financial Corporation.

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15-d-15(e)) for the registrant to have:

     (a)  Designed  such  disclosure  controls  and  procedures,  or caused such
disclosure  controls and  procedures to be designed  under our  supervision,  to
ensure that  material  information  relating to the  registrant,  including  its
consolidated subsidiaries,  is made known to us by others within those entities,
particularly during the period covered in which this report is being prepared;

     (b) Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions  about the effectiveness
of the disclosure  controls and procedures,  as of the end of the period covered
by this report based on such evaluation; and

     (c)  Disclosed  in this  report  any  change in the  registrant's  internal
control over financial  reporting  that occurred  during the  registrant's  most
recent fiscal quarter (the registrant's  fourth fiscal quarter in the case of an
annual  report)  that  has  materially  affected,  or is  reasonably  likely  to
materially affect, the registrant's  internal control over financial  reporting;
and

5. The registrant's other certifying officers and I have disclosed, based on our
most recent  evaluation of internal  control over  financial  reporting,  to the
registrant's auditors and the audit committee of registrant's board of directors
(or persons performing the equivalent functions):

     (a) All significant  deficiencies and material  weaknesses in the design or
operation of internal  control over  financial  reporting  which are  reasonably
likely  to  adversely  affect  the  registrant's  ability  to  record,  process,
summarize and report financial information; and

     (b) Any fraud,  whether or not material,  that involves management or other
employees who have a significant role in the registrant's internal controls over
financial reporting.



Dated: August 14, 2007           By:    George R. Quist
                                        Chairman of the Board and Chief
                                        Executive Officer

<PAGE>


                                  Exhibit 31.2

                            CERTIFICATION PURSUANT TO
                               18 U.S.C. ss. 1350,
                                  AS ENACED BY
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002


I, Stephen M. Sill, certify that:

1. I have  reviewed  this  quarterly  report on Form 10-Q of  Security  National
Financial Corporation.

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.  The  registrant's  other  certifying  officer  and  I  are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15-d-15(e)) for the registrant to have:

     (a)  Designed  such  disclosure  controls  and  procedures,  or caused such
disclosure  controls and  procedures to be designed  under our  supervision,  to
ensure that  material  information  relating to the  registrant,  including  its
consolidated subsidiaries,  is made known to us by others within those entities,
particularly during the period covered in which this report is being prepared;

     (b) Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions  about the effectiveness
of the disclosure  controls and procedures,  as of the end of the period covered
by this report based on such evaluation; and

     (c)  Disclosed  in this  report  any  change in the  registrant's  internal
control over financial  reporting  that occurred  during the  registrant's  most
recent fiscal quarter (the registrant's  fourth fiscal quarter in the case of an
annual  report)  that  has  materially  affected,  or is  reasonably  likely  to
materially affect, the registrant's  internal control over financial  reporting;
and

5. The registrant's other certifying officers and I have disclosed, based on our
most recent  evaluation of internal  control over  financial  reporting,  to the
registrant's auditors and the audit committee of registrant's board of directors
(or persons performing the equivalent functions):

     (a) All significant  deficiencies and material  weaknesses in the design or
operation of internal  control over  financial  reporting  which are  reasonably
likely  to  adversely  affect  the  registrant's  ability  to  record,  process,
summarize and report financial information; and

     (b) Any fraud,  whether or not material,  that involves management or other
employees who have a significant role in the registrant's internal controls over
financial reporting.


Dated: August 14, 2007            By:    Stephen M. Sill
                                         Vice President, Treasurer and Chief
                                         Financial Officer


<PAGE>



                                  EXHIBIT 32.1
                            CERTIFICATION PURSUANT TO
                               18 U.S.C. ss. 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In  connection  with  the  Quarterly  Report  of  Security  National   Financial
Corporation (the "Company") on Form 10-Q for the period ending June 30, 2007, as
filed with the  Securities  and  Exchange  Commission  on the date  hereof  (the
"Report"), I, George R. Quist, Chairman of the Board and Chief Executive Officer
of the Company,  certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge
and belief:

     (1) the Report fully  complies  with the  requirements  of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

     (2)  the  information  contained  in the  Report  fairly  presents,  in all
material  respects,  the  financial  condition  and result of  operations of the
Company.


Dated: August 14, 2007               By:   George R. Quist
                                           Chairman of the Board and Chief
                                           Executive Officer



                                  EXHIBIT 32.2
                            CERTIFICATION PURSUANT TO
                               18 U.S.C. ss. 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In  connection  with  the  Quarterly  Report  of  Security  National   Financial
Corporation (the "Company") on Form 10-Q for the period ending June 30, 2007, as
filed with the  Securities  and  Exchange  Commission  on the date  hereof  (the
"Report"),  I, Stephen M. Sill,  Vice  President,  Treasurer and Chief Financial
Officer of the Company,  certify,  pursuant to 18 U.S.C.  ss.  1350,  as adopted
pursuant to Section 906 of the  Sarbanes-Oxley Act of 2002, that, to the best of
my knowledge and belief:

     (1) the Report fully  complies  with the  requirements  of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

     (2)  the  information  contained  in the  Report  fairly  presents,  in all
material  respects,  the  financial  condition  and result of  operations of the
Company.

Dated: August 14, 2007                 By:   Stephen M. Sill
                                             Vice President, Treasurer and Chief
                                             Financial Officer