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              UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                          WASHINGTON, D.C.  20549
                                FORM 10-Q
  
  
   [X]    QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
          EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30,
          1997,
  
                                    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 Nos.: 33-60662
  
  
                     FUND AMERICA INVESTORS CORPORATION
           (Exact name of registrant as specified in its charter)
  
  
               Delaware                             84-1070310
    (State or other jurisdiction of              (I.R.S. Employer
    incorporation or organization)            identification number)
  
    6400 S. Fiddler's Green Circle, Suite 1200A, Englewood, Colorado 80111
                  (Address of principal executive offices)
  
  
      Registrant's telephone number including area code: (303) 290-6024
  
  
    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 the number of shares outstanding of each of the issuer's
    classes of common stock as of August 14, 1997 -- 1,000 shares
        
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                    FUND AMERICA INVESTORS CORPORATION
                           FORM 10-Q FOR THE
                      SIX MONTHS ENDED JUNE 30, 1997
  
  
                                  INDEX
  
  
  
    PART I.  FINANCIAL INFORMATION                       PAGE NO.
  
         Item 1.   Financial Statements                     3
  
         Item 2.   Management's Discussion and
                   Analysis of Financial Condition
                   and Results of Operations                6
  
    PART II.  OTHER INFORMATION
  
         Item 1.   Legal Proceedings                        7
  
         Item 2.   Changes in Securities                    7
  
         Item 3.   Defaults upon Senior Securities          7
  
         Item 4.   Submission of Matters to a Vote
                   of Security Holders                      7
  
         Item 5.   Other Information                        7
  
         Item 6.   Exhibits and Reports                     7
  
         SIGNATURES                                         8

                            PAGE 2
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PART I.  FINANCIAL INFORMATION
  
Item 1.  Financial Statements
  
                       FUND AMERICA INVESTORS CORPORATION
                                BALANCE SHEETS
                                 (Unaudited)
<CAPTION>      
                                          June 30,             December 31,
                                            1997                   1996
                                          ________             ___________  
<S>                                      <C>                  <C>
   Assets
     Cash                                 $131,720               $147,076
     Deferred offering costs               111,672                111,672
                                          ________              __________
   Total assets                           $243,392               $258,748
                                          ========              ==========
  
    Liabilities - accounts payable        $  2,010              $       -
                                          ________              __________
 
    Shareholder's equity
      Common stock, par value
      $.01 per share;
      10,000 shares authorized;
      1,000  shares issued and
      outstanding                               10                     10
  
      Additional paid-in capital           369,990                369,990
  
      Accumulated deficit                 (128,618)              (111,252)
                                          ________              _________
         Total shareholder's equity        241,382                258,748
                                          ________              _________
      
      Total liabilities and
        shareholder's equity              $243,392                $258,748
                                          ========               =========
  
  

                                     Page 3
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                        FUND AMERICA INVESTORS CORPORATION
                             Statements of Operations
                                   (Unaudited)
  
<CAPTION>                                                                
  
                                    Three months ended    Six months ended
                                        June 30,             June 30,
                                    _________________     ________________
                                    1997       1996       1997       1996
                                  ______      _______    ______    _______
 <S>                             <C>         <C>        <C>       <C>  
   Revenue
     Interest income              $1,171      $1,485     $2,397    $3,401
     Miscellaneous income              0       3,600          0     3,600
                                  ______      ______     ______    ______    
           Total revenue           1,171       5,085      2,397     7,001
                                  ______      ______     ______    ______ 
                                   
    Expenses
     General and administrative      460       1,016      7,081     7,677
     Legal fees                      550         192        682       368
     Management fees               6,000       6,000     12,000    12,000
                                  ______      ______     ______    ______
           Total expenses          7,010       7,208     19,763    20,045
                                  ______      ______     ______    ______
           Net loss              $(5,839)    $(2,123)  $(17,366) $(13,044)
                                 =======     =======   ========  ========

    
  
                                     Page 4

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<TABLE>
   
    
                     FUND AMERICA INVESTORS CORPORATION
                           Statements of Cash Flows
                                 (Unaudited)
  
 <CAPTION> 
  
                                              Six months ended
                                                    June 30,
                                          ________________________ 
                                            1997             1996
                                        _________         _________  
  <S>                                  <C>               <C>
    Net cash flow used in
    operating activities:
  
      Net loss                          $(17,366)         $(13,044)
  
     Adjustments to reconcile net
     loss to net cash flow
     from operating activities:
      Changes in operating
      assets and liabilities:
         Deferred offering costs                -            5,000
         Accounts payable                   2,010          (45,085)
                                        _________         ________
    Net cash flow used in
    operating activities                  (15,356)         (53,129)
                                        _________         ________
  
   Net decrease in cash                   (15,356)         (53,129)
  
   Cash at beginning of period            147,076          212,361
                                         ________         ________
   
   Cash at end of period                 $131,720         $159,232
                                         ========         ========



                                    Page 5
  
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                     FUND AMERICA INVESTORS CORPORATION
                        NOTES TO FINANCIAL STATEMENTS
                                 (Unaudited)
                   Six months ended June 30, 1997 and 1996
  
  1.  Basis of Presentation
  
    Organization
  
       Fund America Investors Corporation (the "Company") was incorporated
  in the State of Delaware on October 19, 1987 as a limited purpose finance
  corporation.  The company was established to engage in the issuance and
  administration of Collateralized Mortgage Obligations ("CMOs") which
  are secured by mortgage loans or by mortgage loan pass-through
  certificates backed by mortgage loans (collectively referred to as the
  "Collateral").  The Collateral may be issued and/or guaranteed by
  agencies, including the Government National Mortgage Association, the
  Federal National Mortgage  Association and the Federal Home Loan Mortgage
  Corporation, or other entities.  To issue such CMOs, the Company may
  acquire, hold, sell or pledge the Collateral, but typically these
  activities are transacted through trusts beneficially owned and created
  by the Company. 
  
       The Company may not, either directly or indirectly, through a
  beneficially owned trust, engage in any business or investment activity
  other than (i) issuing and selling CMOs (ii) investing cash balance on an
  interim basis in high quality short-term securities; (iii) purchasing,
  owning, holding, pledging or selling the Collateral or other
  mortgage-related assets; and (iv)engaging in other activities which are
  necessary or convenient to accomplish the foregoing and are incidental
  thereto.  
  
       Under its fourth Registration Statement, declared effective on July
  23, 1993, the Company currently has registered but unissued $141,000,000
  in CMOs.  The Company will continue to seek opportunities to utilize the
  remaining $141 million of registered and unissued CMOs.
  
  2. Unaudited Financial Statements
  
       In the opinion of management, the accompanying unaudited financial
  statements contain all adjustments necessary to present fairly the
  financial position of the Company at June 30, 1997, and the results of
  its operations and  cash flows for the periods ended June 30, 1997 and
  1996.
  

                               Page 6

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  Item 2.  Management's Discussion and Analysis of Financial Condition and 
           Results of Operations
  
       Liquidity and Capital Resources
  
       The Company expects to fund its ongoing operations from its cash
  balances, revenue derived from CMO offerings and, if necessary, with 
  borrowings from its sole shareholder.  As of June 30, 1997, $500,000 was
  available to be borrowed from the Company's sole shareholder.  Any
  borrowings will be subordinate and junior to any issued mortgage
  securities.
  
       The Company will use substantially all of the net proceeds from the
  issuance of each series of CMOs to acquire the mortgage loans or mortgage
  certificates pledged as collateral for such series of CMOs, and to pay
  issuance expenses incurred in connection with the transaction.
  
       Results of Operations
  
       The Company reported a net loss for the six months ended June 30,
  1997 of $17,366  as compared to a net loss for the six months ended June
  30, 1996 of $13,044.  A decrease of interest earned on cash balances is
  the primary difference in the results of operations between the two
  reporting periods.


                               Page 7
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    PART II. OTHER INFORMATION
  
  
  
    Item 1.  Legal Proceedings
  
             None.
  
    Item 2.  Changes in Securities
  
             None.
  
    Item 3.  Defaults Upon Senior Securities
  
             None.
  
    Item 4.  Submission of Matters to a Vote of Security Holders
  
             None.
  
    Item 5.  Other Information
  
             None.
  
    Item 6.  Exhibits and Reports on Form 8-K
  
         A.  Exhibits
  
             Exhibit 27. Financial Data Schedule
  
         B.  Form 8-K - None
  
        

                                Page 8
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                             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.
  
  
  
                                    FUND AMERICA INVESTORS CORPORATION
                                    (Registrant)
  
  
    Date:   August 14, 1997         By: /s/ Helen M. Dickens           
                                    Helen M. Dickens
                                    Vice President, Secretary/Treasurer
                                    (Duly authorized and Principal
                                    Financial Officer






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