REDWOOD MORTGAGE INVESTORS VI
                       (a California Limited Partnership)
                               Index to Form 10-K

                                December 31, 2001

                                     Part I
                                                                      Page No.
                                                                      --------
Item 1 - Business                                                         3
Item 2 - Properties                                                       4
Item 3 - Legal Proceedings                                                6
Item 4 - Submission of Matters to a Vote of Security
         Holders (Partners)                                               6

                                     Part II

Item 5 - Market for the Registrant's "Limited Partnership Units"
         and Related Unitholder Matters                                   6
Item 6 - Selected Financial Data                                          7
Item 7 - Management's Discussion and Analysis of Financial
         Condition and Results of Operations                              9
Item 8 - Financial Statements and Supplementary Data                     13
Item 9 - Changes in and Disagreements with Accountants on
         Accounting and Financial Disclosure                             32

                                    Part III

Item 10 - Directors and Executive Officers of the Registrant             33
Item 11 - Executive Compensation                                         33
Item 12 - Security Ownership of Certain Beneficial Owners
          and Management                                                 34
Item 13 - Certain Relationships and Related Transactions                 34

                                     Part IV


Item 14 - Exhibits, Financial Statements and  Schedules, and
          Reports of Form 8-K                                            34

Signatures                                                               35


<PAGE>


                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    Form 10-K

                Annual Report Pursuant to Section 13 or 15(d) of
                       the Securities Exchange Act of 1934

       For the year ended December 31, 2001 Commission File number 33-12519
--------------------------------------------------------------------------------

                       REDWOOD MORTGAGE INVESTORS VI
--------------------------------------------------------------------------------
      (Exact name of registrant as specified in its charter)

            California                                            94-3031211
-----------------------------                                  -----------------
(State or other jurisdiction of                 (I.R.S. Employer Identification)
 incorporation or organization)

 650 El Camino Real #G, Redwood City, CA                              94063
--------------------------------------------              ----------------------
 (address of principal executive offices)                          (zip code)

  Registrant's telephone number including area code               (650) 365-5341
----------------------------------------------------      ----------------------

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

 Title of each class                  Name of each exchange on which registered
---------------------------       ----------------------------------------------
          None                                             None
--------------------------------------------------------------------------------

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

     Indicate by check mark whether the  registrant (1) has filed all reports to
be filed by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934 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          XX                                             NO
    -------------------                                        -----------------

     At the close of the sale of units in 1989,  the limited  partnership  units
purchased by  non-affiliates  was 97,725.94 units computed at $100.00 a unit for
$9,772,594, excluding general partners' contribution of $9,772.

Documents incorporated by reference:

     Portions of the Prospectus for Redwood  Mortgage  Investors VI, included as
part of the form  S-11  Registration  Statement,  SEC File  No.  33-12519  dated
September 3, 1987 and Supplement No. 6 dated May 16, 1989, incorporated in Parts
II, III, and IV.

<PAGE>

                                     Part I
Item 1 - Business

     Redwood  Mortgage  Investors VI is a California  Limited  Partnership  (the
"partnership").   Michael  R.  Burwell  and  Gymno  Corporation,   a  California
corporation,  are the general  partners.  The address of the general partners is
650 El Camino Real, Suite G, Redwood City,  California  94063. The partnership's
primary  purpose  is to invest its  capital  in first and second  deeds of trust
secured by Northern  California  properties.  Loans are arranged and serviced by
Redwood Mortgage Corp., an affiliate of the general partners.  The partnership's
objectives are to make investments  which will: (i) provide the maximum possible
cash  returns  which  limited  partners  may elect to (a)  receive  as  monthly,
quarterly or annual cash  distributions  or (b) have earnings  credited to their
capital accounts and used to invest in partnership activities; and (ii) preserve
and protect the partnership's  capital.  The  partnership's  general business is
more fully  described  under the section  entitled  "Investment  Objectives  and
Criteria",  pages  23-26  of  the  Prospectus,  a part  of the  above-referenced
Registration Statement, which is incorporated by reference.

     The  partnership was formed in September,  1987,  with an approved  120,000
Units of $100 each  ($12,000,000).  The Units were  offered on a "best  efforts"
basis  through  broker/dealer  member  firms  of  the  National  Association  of
Securities Dealers,  Inc. It immediately began issuing Units and began investing
in loans in October, 1987. The offering terminated in September, 1989, and as of
that date  97,725.94  Units  were sold  realizing  proceeds  of  $9,772,594.  At
December 31, 2001, the  partnership  had a balance of loans totaling  $4,970,433
with interest rates thereon ranging from 6.50% to 14.75%.

     Currently  First Trust Deeds  comprise  75.85% of the total  amount of loan
portfolio.  Second  Mortgage Trust Deeds  comprise  22.86% of loan portfolio and
Third Mortgage Trust Deeds comprise 1.29% of the loan portfolio.  Owner-occupied
homes,  combined with non-owner occupied homes, total 18.57% of the loans. Loans
to  apartments  make up 11.31% of the total  loans  portfolio.  Commercial  loan
origination increased from last year, now comprising 70.12% of the portfolio, an
increase of 6.07% from 2000. The past year brought many  outstanding low loan to
value lending  opportunities in the commercial  segment of the market. The major
concentration  of  loans,  comprising  77.57% of the  total  loans,  are in four
counties of the San Francisco Bay Area. The County of Sacramento makes up 10.20%
of the loan portfolio.  The balance,  as stated on page five of this report, are
primarily in Northern California.  Currently loan size is averaging $184,090 per
loan. Some of the loans are fractionalized between affiliated  partnerships with
objectives  similar to those of the partnership to further reduce risk.  Average
equity  per loan  transaction  stood at  28.73%.  A 40%  equity  average on loan
origination  is generally  considered  very  conservative.  Generally,  the more
equity, the more protection for the lender. The partnership's loan portfolio had
only three  properties  in  foreclosure  as of the end of December  2001,  which
represents 8.84% of the partnership's  loan portfolio.  Two of the borrowers are
likely to come out of the  foreclosure by March 2002,  and the other  defaulting
borrower is in bankruptcy.

<PAGE>
Item 2 - Properties

As of December 31, 2001, a summary of the partnership's loan portfolio is set
forth below.

Loans as a Percentage of Total Loans


First Trust Deeds                                   $ 3,770,088.60
Appraised Value of Properties                         5,013,260.40
                                               --------------------
   Total Investment as a % of Appraisal                     75.20%
                                               --------------------

First Trust Deeds                                     3,770,088.60
Second Trust Deed Loans                               1,136,480.58
Third Trust Deed Loans                                   63,863.76
                                               --------------------
                                                    $ 4,970,432.94
                                               --------------------
Priority Positions
   First Trust Deeds due other Lenders                5,552,409.00
   Second Trust Deeds due other Lenders                  74,593.00
                                               --------------------

Total Debt                                         $ 10,597,434.94
                                               ====================

   Appraised Property Value                        $ 14,868,548.40
   Total Investments as a % of Appraisal                    71.27%


Number of Loans Outstanding                                     27


Average Investment                                      184,090.11
Average Investment as a % of Net Assets                      2.63%
Largest Investment Outstanding                        1,376,117.03
Largest Investment as a % of Net Assets                     19.63%


Loans as a Percentage of Total Loans                        Percent
---------------------------------------------    -------------------

First Trust Deeds                                            75.85%
Second Trust Deeds                                           22.86%
Third Trust Deeds                                             1.29%
                                                 -------------------
Total                                                       100.00%

Loans by Type of Property                 Amount              Percent
---------------------------------     ----------------     --------------

Owner Occupied Homes                     $ 741,153.70             14.91%
Non-Owner Occupied Homes                   181,952.27              3.66%
Apartments                                 562,015.44             11.31%
Commercial                               3,485,311.53             70.12%
                                      ----------------     --------------
Total                                  $ 4,970,432.94            100.00%
                                      ================     ==============




<PAGE>



The following is a distribution of loans outstanding as of December 31, 2001 by
Counties.

                             Total Mortgage
       County                 Investments               Percent
---------------------     ---------------------     -----------------

Santa Clara                      $2,025,328.93                40.75%
Alameda                             996,230.25                20.04%
Sacramento                          507,101.20                10.20%
San Francisco                       418,567.94                 8.42%
San Mateo                           415,594.29                 8.36%
Stanislaus                          177,100.64                 3.56%
Tuolumne                            170,000.00                 3.42%
Placer                              138,456.63                 2.79%
Shasta                               78,557.42                 1.58%
Sonoma                               43,495.64                 0.88%
                          ---------------------     -----------------
Total                            $4,970,432.94               100.00%
                          =====================     =================


Statement of Condition of loans:
         Number of Loans in Foreclosure                    3

Scheduled maturity dates of loans as of December 31, 2001 are as follows:

                         Year Ending
                         December 31,

                             2002                           $3,306,702
                             2003                              434,479
                             2004                              741,154
                             2005                               40,125
                             2006                               96,716
                          Thereafter                           351,257
                                                        ---------------
                                                            $4,970,433
                                                        ===============

     The scheduled  maturities for 2002 include $2,935,731,  representing 59% of
the portfolio,  which are past maturity at December 31, 2001. $439,311 (8.84% of
the loan portfolio) of those loans were  categorized as delinquent over 90 days.
.. Several  of these  borrowers  were in the  process  of  refinancing  the loans
through other  institutions  as this was an opportune time for them to do so and
take advantage of lower interest rates.  Additionally,  the  partnership  allows
borrowers to occasionally continue to make the regular interest payments on debt
past maturity for periods of time. The partnership, in most instances,  receives
the benefit of a higher  interest rate than would  otherwise be available in the
currently  existing loan marketplace.  Interest payments on three of these loans
were delinquent.


<PAGE>

Item 3 - Legal Proceedings

     In the normal course of business,  the  partnership  may become involved in
various types of legal  proceedings  such as  assignments  of rents,  bankruptcy
proceedings,   appointments   of   receivers,   unlawful   detainers,   judicial
foreclosures, etc., to enforce the provisions of the deeds. The partnership is a
defendant along with numerous defendants, including a developer, contractor, and
other lenders,  in a lawsuit involving the partnership's  attempt to recover its
investment in real estate acquired through foreclosure.

Item 4 - Submission of Matters to a Vote of Security Holders (Partners)

No matters have been submitted to a vote of the partnership.

                                     Part II

Item 5 - Market for the Registrant's "Limited Partnership Units"
         and Related Unitholder Matters

     120,000  Units  at $100  each  (minimum  20  units)  were  offered  through
broker-dealer  member firms of the National Association of Securities Dealers on
a "best  efforts"  basis (as indicated in Part I item 1). All Units were sold to
California  residents.  Investors have the option of  withdrawing  earnings on a
monthly,  quarterly or annual basis or  reinvesting  and  compounding  earnings.
Limited  partners may withdraw from the partnership in accordance with the terms
of the partnership agreement subject to early withdrawal penalties.  There is no
established public trading market for the Units.

     A  description  of the  partnership's  units,  transfer  restrictions,  and
withdrawal  provisions  is more  fully  described  under  the  section  entitled
"Description of Units" and "Summary of the Limited Partnership Agreement", pages
38-42 of the Prospectus, a part of the above-referenced  Registration statement,
which is incorporated by reference.

<PAGE>

Item 6 - Selected Financial Data

     Redwood  Mortgage  Investors  VI began  operations  in  October  1987.  Its
financial  condition and results of operation for five years ended  December 31,
2001 were:

                                 Balance Sheets
<TABLE>
                                                                                 December 31,
                                                ------------------------------------------------------------------------------------
<S>                                                 <C>              <C>               <C>               <C>               <C>
                                                    2001             2000              1999              1998              1997
                                                -------------    --------------    -------------    ---------------    -------------
Cash                                                $190,414          $354,860       $1,120,295           $299,775          $331,143

Loans
  Loans, secured by deeds of trust                 4,970,433         5,570,576        5,282,773          7,969,735         8,104,984
  Loans, unsecured                                    82,362            82,362                -             23,775           161,414

Interest and other receivables
  Accrued interest on loans                          751,673           664,292          706,841            717,719           617,456
  Advances on loans                                  197,946           133,647          137,930            162,083           127,519

Less allowance for doubtful accounts               (462,489)         (261,452)        (303,249)          (202,344)          (28,614)

Investment in partnership                                  -                 -                -                  -           708,141
Note receivable- Redwood Mortgage Corp               188,000           125,000          300,000                  -                 -
Real estate owned (REO), net                       1,185,380           767,583          133,300            169,922           309,319
Real estate owned in process                               -                 -          668,132                  -                 -
                                                -------------    --------------    -------------    ---------------    -------------
     Total assets                                 $7,103,719        $7,436,868       $8,046,022         $9,140,665       $10,331,362
                                                =============    ==============    =============    ===============    =============


                        Liabilities and Partners' Capital

Liabilities
  Notes payable - bank line of credit              $       -         $       -       $        -           $390,000          $899,011
 Accounts payable                                     20,261            13,068                -             22,668               898
  Deferred interest on loans                          74,022                 -           15,676             20,463                 -
                                                -------------    --------------    -------------    ---------------    -------------
     Total liabilities                                94,283            13,068           15,676            433,131           899,909
                                                =============    ==============    =============    ===============    =============

Partners' capital
  Limited partners' capital, subject
    to redemption                                  6,999,670         7,414,034        8,020,580          8,697,768         9,421,687
    General partners' capital                          9,766             9,766            9,766              9,766             9,766
                                                -------------    --------------    -------------    ---------------    -------------

    Total partners' capital                        7,009,436         7,423,800        8,030,346          8,707,534         9,431,453
                                                -------------    --------------    -------------    ---------------    -------------

    Total liabilities and partners' capital       $7,103,719        $7,436,868       $8,046,022         $9,140,665       $10,331,362
                                                =============    ==============    =============    ===============    =============


<PAGE>


                              Statements of Income

                                                                                     December 31,
                                                    --------------------------------------------------------------------------------
                                                       2001            2000             1999             1998              1997
                                                    -----------    -------------    -------------    --------------    -------------

Gross revenue                                         $735,900         $785,209       $1,086,317          $871,861       $1,036,596
Expenses                                               309,248          307,280          565,408           359,356          507,409
                                                    -----------    -------------    -------------    --------------    -------------
Net income                                            $426,652         $477,929         $520,909          $512,505         $529,187
                                                    ===========    =============    =============    ==============    =============


Net income: to general partners (1%)                    $4,267           $4,779           $5,209            $5,125           $5,292
                     to limited partners (99%)         422,385          473,150          515,700           507,380          523,895
                                                    -----------    -------------    -------------    --------------    -------------

                                                      $426,652         $477,929         $520,909          $512,505         $529,187
                                                    ===========    =============    =============    ==============    =============

Net income per $1,000 invested by limited partners for entire period:
  - where income is retained and compounded                $59              $62              $62               $56              $53
                                                    ===========    =============    =============    ==============    =============

  -where partner receives income in monthly
     distributions                                         $58              $60              $61               $55              $52
                                                    ===========    =============    =============    ==============    =============
</TABLE>

     The annualized  yield for 1999 was 6.24%, for 2000 the annualized yield was
6.22%,  and for 2001 the annualized  yield was 5.95%.  The annualized yield from
inception through December 31, 2001, was 7.16%.

<PAGE>

Item 7 - Management Discussion and Analysis of Financial Condition and Results
         of Operations Forward Looking Statements.

     Some of the  information  in the Form  10-K  may  contain  forward  looking
statements.  Uses of words  such as  "will",  "may",  "anticipate",  "estimate",
"continue"  or other forward  looking  words,  discuss  future  expectations  or
predictions.  The foregoing analysis of 2001 includes forward looking statements
and  predictions  about  possible of future  events,  results of operations  and
financial  condition.  As such, this analysis may prove to be inaccurate because
of  assumptions  made by the general  partners or the actual  development of the
future  events.  No  assurance  can be given  that any of  these  statements  or
predictions will ultimately prove to be correct or substantially correct.

         Management's Discussion and Analysis of Financial Condition and
                              Results of Operations

     As of September 2, 1989, the  partnership  had sold 97,725.94 Units and its
contributed  capital totaled  $9,772,594 of the approved  $12,000,000  issue, in
Units of $100  each.  As of that  date the  offering  was  formally  closed.  On
December 31, 2001, the partnership's net capital totaled $7,009,436.

     The  partnership  began funding loans in October  1987.  The  partnership's
loans  outstanding  for the years ended  December 31, 1999,  2000, and 2001 were
$5,282,773,  $5,570,576,  and  $4,970,433  respectively.  The  decrease in loans
outstanding  from  December 31, 1999 to December 31, 2001,  was due primarily to
the  partnership   utilizing  loan  payoffs  to  meet  limited  partner  capital
liquidations,  line of credit pay-down, uninvested cash in loans and an increase
in Real Estate Owned or in process.  During the years 1999, 2000, and 2001, loan
principal collections exceeded limited partner liquidations.

     Beginning the fall of 1999,  mortgage  interest  rates have been rising due
primarily  to  economic  forces  and by the  Federal  Reserve  raising  its core
interest  rates.  However,  since  January  2001,  the Federal  Reserve has been
dramatically  cutting  its core  interest  rates with  eleven  successive  cuts,
ranging from .25% to .50%. The latest cut being December 11, 2001, which reduced
the Federal Funds Rate to 1.75%.  In late January 2002, the Federal  Reserve met
and did not  change  interest  rates  signaling  that it may take a wait and see
course before making any further  interest rate changes.  The effect of the cuts
has greatly  reduced  short-term  interest  rates and to a lesser extent reduced
long-term interest rates. New loans will be originated at then existing interest
rates. In the future, the general partners anticipate that interest rates likely
will change from their current levels.  The general partners cannot at this time
predict  at what  levels  interest  rates  will be in the  future.  The  general
partners  anticipate  that new loans  will be placed at rates  approximately  1%
lower than similar loans during the first half of 2001. The lowering of interest
rates has encouraged  those  borrowers that hold higher interest rate loans than
those currently  available to seek refinancing of their existing  obligations to
take advantage of these lower rates. The partnership may face prepayments in the
existing  portfolio  from  borrowers  taking  advantage  of these  lower  rates.
However, demand for loans from qualified borrowers continues to be strong and as
prepayments occur, we expect to replace these loans with loans at somewhat lower
interest rates. At this time, the general partners believe that the average loan
portfolio  interest rate will decline  approximately  .25% to .50% over the year
2002.  Nevertheless,  based  upon the  rates  expected  in  connection  with the
existing loans, and anticipated  interest rates to be charged by the partnership
and the general partners'  experience,  the general partners anticipate that the
annualized yield will range between 5.75% and 6.25% for the year 2002.

     Previously  the  partnership  had a line of credit with a commercial  bank,
which was secured by its loan portfolio.  On December 31, 1999 the  partnership,
on its own accord,  closed its line of credit with that bank and since that time
has not negotiated a similar credit line with any  institution.  Management felt
that the need for the  credit  line was not  necessary  as cash  flows from loan
payments and payoffs have been in  synchronization  with loan  opportunities and
limited partner liquidations.

     The partnership's operating results and delinquencies are within the normal
range of the  general  partners  expectations,  based upon their  experience  in
managing similar partnerships over the last twenty-four years.  Foreclosures are
a normal aspect of partnership  operations and the general  partners  anticipate
that they will not have a material effect on liquidity. As of December 31, 2001,
there were three  properties in  foreclosure  totaling  $439,311 or 8.84% of the
loan  portfolio.  As of December  31, 2001 the  partnership's  real estate owned
account  balance  was  $1,185,380.  This  account  had a  balance  of  $133,300,
$767,583, and $1,185,380 as of December 31, 1999, 2000, and 2001,  respectively.
The  increase was due to  acquisition  and paying off the first lien holder of a
commercial property through  foreclosure  recorded as REO in process in December
1999.  As of  December  31,  2001 the  partnership  disposed of one of its other
pieces of real estate owned property through sale.

     Cash is continually being generated from interest  earnings,  late charges,
prepayment   penalties,   and  amortization  of  principal  and  loan  pay-offs.
Currently,  this amount  exceeds  partnership  expenses and earnings and partner
liquidation  requirements.  As loan opportunities become available,  excess cash
and available funds are invested in new loans.

     The general  partners  regularly  review the loan portfolio,  examining the
status of  delinquencies,  the underlying  collateral  securing these loans, REO
expenses,  sales  activities,  and  borrower's  payment  records  and other data
relating to the loan portfolio. Data on the local real estate market, and on the
national and local economy are studied.  Based upon this  information  and more,
loan loss  reserves  and  allowance  for  doubtful  accounts  are  increased  or
decreased.  Because  of the  number of  variables  involved,  the  magnitude  of
possible  swings and the general  partners  inability  to control  many of these
factors, actual results may and do sometimes differ significantly from estimates
made by the  general  partners.  Management  provided  $437,558,  $193,427,  and
$201,036 as  provision  for doubtful  accounts for the years ended  December 31,
1999,  2000, and 2001,  respectively.  The increase in allowance for 1999, 2000,
and 2001 was to build up  reserve  for any  potential  loss in the  future.  The
partnership  acquired  a piece of  property  through  foreclosure  in  2000.  In
anticipation  of this event,  the  partnership  carried  $668,132 in its balance
sheet as Real Estate Owned in Process as of December 31, 1999.  This  investment
was reclassified  into Real Estate Owned in the year 2000.  Management  believes
that reserves  previously  set aside in  anticipation  of this  acquisition  are
adequate.  The  modest  incremental  increase  of  $7,609 in  doubtful  accounts
provision  for the year  2001 is due to  Managements  belief  that  the  current
overall  reserve  balances of $462,489 are adequate and additional  reserves set
aside are not currently warranted.

     The  partnership  makes  loans  primarily  in  Northern  California.  As of
December  31, 2001,  approximately  78%,  ($3,855,721)  of the loans held by the
partnership  were in the four San Francisco Bay Area Counties.  The remainder of
the loans held were secured primarily by Northern California real estate outside
the San Francisco Bay Area.  Like the rest of the nation,  the San Francisco Bay
Area has also felt the recession and  accompanying  slow down in economic growth
and increasing  unemployment.  The technology  companies of Silicon Valley,  the
airline  industry,  the tourism  industry and other  industries  are feeling the
effects of the overall United States  recession,  which includes lower earnings,
losses and layoffs.

     The Northern California residential real estate market and particularly the
San Francisco Bay Area residential real estate market  experienced  increases in
values of over 10% in 1999 and 2000, respectively. In 2001, the residential real
estate marketplace  slowed,  this has resulted in longer listing and transaction
times and lower market prices in some segments.  The  California  Association of
Realtors  reported in  November  2001 that the  statewide  median home price had
reached  its  highest  point ever with a median  home price of $278,740 up 11.2%
from a year  earlier and 2.4% higher than in October of 2001.  It also  reported
that overall volume of home sales slipped 12.4% from the year earlier.  In spite
of  these  California  wide  higher  home  prices,  the San  Francisco  Bay Area
experienced median sales prices through October of 2001 of between minus 4.2% to
a  positive  16.7% for  resale  homes.  In spite of these  numbers  the  general
partners  believe that lower-end and mid-priced homes have continued to increase
in value,  although at a reduced rate from 2000, while high end homes have begun
to decrease in value.  This  situation  is showing  some signs of a  turnaround.
Inventories of homes available for sale have decreased  sharply from their highs
in the spring of 2001. For example, the supply of "for sale" homes, condominiums
and  townhomes  in Santa Clara County  peaked the week of May 25, 2001,  at more
than 5,700, according to Coldwell Banker Northern California  statistics.  As of
January  18,  2002,  fewer than 2,500  homes were "for sale"  countywide.  Other
counties in the San Francisco Bay Area offer similar  statistics.  The number of
single-family  home sales in Santa Clara County was 962 for December  2001 which
is the greatest  number of homes sold since records  became public in 1984.  The
reduction in  inventories  and the strong  sales may  indicate  that the buyer's
market that  prevailed  throughout  most of 2001 may be coming to an end and may
indicate that a recovery is underway. A stabilization of residential home prices
or a recovery  in home prices is good for the  partnership  since we depend more
heavily  than  banks and other  similar  credit  type  lenders on the value of a
property.

     Commercial  property  vacancy  rates have  continued  to climb with the San
Francisco  Bay Area office  market  surpassing  15% as a whole  according  to BT
Commercial  Real Estate and Grubb and Ellis Co. As a result,  rents have dropped
about 40% from last year's highs, giving up nearly all the gains made during the
past three years.  Though  vacancy rates have leaped from 2 percent in the third
quarter of 2000 to 15% at the end of 2001, landlords are bearing only about half
the pain,  since  nearly half the office  space being  offered is for  sublease,
meaning  landlords  generally  are  still  collecting  money  from the  original
tenants.  To the  partnership  the higher overall vacancy rates may mean that we
experience  greater  delinquencies in its commercial portion of the portfolio if
landlord's  existing leases expire or space becomes  available  through business
failures.

     The  partnership had an average loan to value ratio computed as of the date
the loan was made of 71.27%,  as of December 31, 2001.  This did not account for
any changes in property values for loans, which were acquired by the partnership
during  1997,  1998,  1999,  and  2000  when  Northern  California  Real  Estate
substantially  increased  in  value.  This  low loan to value  will  assist  the
partnership in weathering downturns in real estate values if they materialize in
the coming months.

     The  partnership's  interest  in land  located  in East Palo  Alto,  CA was
acquired  through  foreclosure.  The  investment  was  previously  classified as
Investment in Partnership in the Financial  Statements and has been reclassified
into Real Estate  Owned.  The  partnership's  basis of  $128,443,  $80,142,  and
$20,377,  for the years ended December 31, 2001,  2000, and 1999,  respectively,
has been  invested  with  that of two  other  partnerships.  In order to  pursue
development  options,  rezoning of the property's  existing  residential  zoning
classification  will be  required.  The  partnership  is  continuing  to explore
remediation  options  available to mitigate the pesticide  contamination,  which
affects the property.  This pesticide  contamination appears to be the result of
agricultural  operations by prior owners. The general partners do not believe at
this time that  remediation of the pesticide  contaminants  will have a material
adverse effect on the financial condition of the partnership. The efforts of the
general  partners  to  subdivide  the land have met with  success.  The  arsenic
contaminated portion of the property has been delivered to the party responsible
for the arsenic  contamination.  The remaining  land will be made  available for
development or sale by the partnership.  The general partners believe this to be
a good result for the partnership.

     At the time of subscription to the  partnership,  limited  partners made an
irrevocable decision to either take distributions of earnings monthly, quarterly
or annually or to compound  earnings  in their  capital  account.  For the years
ended December 31, 1999 2000, and 2001, the partnership  made  distributions  of
earnings to limited partners after allocation of syndication  costs of $217,526,
$192,356,  and  $164,787,  respectively.  Distribution  of  earnings  to limited
partners after allocation of syndication  costs for the years ended December 31,
1999, 2000, and 2001, to limited  partners'  capital accounts and not withdrawn,
was $298,174,  $280,794,  and $257,598,  respectively.  As of December 31, 1999,
2000, and 2001, limited partners electing to withdraw earnings  represented 42%,
41%,  and  36%,  respectively,  of  the  limited  partners  outstanding  capital
accounts.

     The partnership  also allows the limited partners to withdraw their capital
account  subject  to  certain   limitations  (see   liquidation   provisions  of
Partnership  Agreement).  For the years ended December 31, 1999, 2000, and 2001,
$128,295, $200,417, and $187,804,  respectively,  were liquidated subject to the
10% and/or 8% penalty for early  withdrawal.  These  withdrawals  are within the
normally  anticipated  range that the  general  partners  would  expect in their
experience in this and other  partnerships.  The general  partners expect that a
small  percentage  of limited  partners  will elect to liquidate  their  capital
accounts  over one  year  with a 10%  and/or  8% early  withdrawal  penalty.  In
originally  conceiving the  partnership,  the general partners wanted to provide
limited   partners  needing  their  capital  returned  a  degree  of  liquidity.
Generally, limited partners electing to withdraw over one year need to liquidate
investments  to raise  cash.  The  trend  the  partnership  is  experiencing  in
withdrawals  by  limited  partners  electing  a  one  year  liquidation  program
represents  a small  percentage  of limited  partner  capital as of December 31,
1999, 2000, and 2001,  respectively,  and is expected by the general partners to
commonly occur at these levels.

     Additionally,  for the years  ended  December  31,  1999,  2000,  and 2001,
$847,067,  $686,923,  and  $484,158,  respectively,  were  liquidated by limited
partners who have elected a  liquidation  program over a period of five years or
longer.  Once the initial five-year hold period has passed, the general partners
expect to see an increase in liquidations due to the ability of limited partners
to  withdraw  without  penalty.  This  ability to  withdraw  after five years by
limited  partners has the effect of providing  limited  partner  liquidity.  The
general  partners expect a portion of the limited  partners to take advantage of
this  provision.  This has the anticipated  effect of the  partnership  growing,
primarily  through  reinvestment  of  earnings in years one  through  five.  The
general partners expect to see increasing numbers of limited partner withdrawals
in years five through eleven,  at which time the bulk of those limited  partners
who have  sought  withdrawal  will  have been  liquidated.  After  year  eleven,
liquidation  generally  subsides  and the  partnership  capital  again  tends to
increase.

Actual liquidation of both capital and earnings from year five (1992) through
year thirteen (2001), is shown hereunder, which confirms the general partners
theory on the liquidation habits of the limited partners:

                                    Years ended December 31,
<TABLE>

<S>                   <C>               <C>              <C>               <C>               <C>
                      1992              1993             1994              1995              1996
                  -------------     -------------    -------------     -------------    ----------------
Earnings              $323,037          $377,712         $303,014          $303,098            $294,678
Capital               *232,370          *528,737         *729,449          *892,953          *1,183,099
                  -------------     -------------    -------------     -------------    ----------------
Total                 $555,407          $906,449       $1,032,463        $1,196,051          $1,477,777
                  =============     =============    =============     =============    ================



                      1997             1998              1999              2000              2001
                  -------------    --------------    -------------     -------------    ----------------
Earnings              $257,670          $235,837         $217,526          $192,356            $164,787
Capital             *1,297,410        *1,060,109         *975,362          *887,340            *671,962
                  -------------    --------------    -------------     -------------    ----------------
Total               $1,555,080        $1,295,946       $1,192,888        $1,079,696            $836,749
                  =============    ==============    =============     =============    ================
</TABLE>

*These amounts represent gross of early withdrawal penalties.

<PAGE>
     In some  cases in order to  satisfy  Broker  Dealers  and  other  reporting
requirements, the general partners have valued the limited partners' interest in
the  partnership  on a basis which  utilizes a per unit  system of  calculation,
rather than based upon the investors' capital account. This information has been
reported  in this manner in order to allow the  partnership  to  integrate  with
certain  software used by the Broker Dealers and other  reporting  entities.  In
those cases, the partnership will report to Broker Dealers,  Trust Companies and
others a  "reporting"  number of units based upon a $1.00 per unit  calculation.
The number of reporting units provided will be calculated based upon the limited
partner's  capital  account  value  divided by $1.00.  Each  investor's  capital
account balance is set forth  periodically on the partnership  account statement
provided  to  investors.  The  reporting  units are solely  for  Broker  Dealers
requiring such information for their software programs and do not reflect actual
units owned by a limited  partner or the limited  partners' right or interest in
cash flow or any other  economic  benefit in the  partnership.  Each  investor's
capital  account balance is set forth  periodically  on the partnership  account
statement  provided  to  investors.  The  amount of  partnership  earnings  each
investor is entitled to receive is determined by the ratio that each  investor's
capital account bears to the total amount of all investor  capital accounts then
outstanding.  The capital account balance of each investor should be included on
any NASD member client account statement in providing a per unit estimated value
of the client's investment in the partnership in accordance with NASD Rule 2340.

     While the general  partners have set an estimated value for the partnership
units,  such  determination  may not be  representative  of the  ultimate  price
realized  by an  investor  for such units upon sale.  No public  trading  market
exists for the partnership's units and none is likely to develop. Thus, there is
no certainty  that the units can be sold at a price equal to the stated value of
the capital account. Furthermore, the ability of an investor to liquidate his or
her investment is limited subject to certain  liquidation rights provided by the
partnership,  which may include early  withdrawal  penalties (See the section of
the  Prospectus  entitled  "Risk  Factors  -  Purchase  of Units is a long  term
investment").

<PAGE>

Item 8 - Financial Statements and Supplementary Data


A- Financial Statements

The following financial statements of Redwood Mortgage Investors VI are included
in Item 8:

o       Independent Auditors' Report
o       Balance Sheets - December 31, 2001, and December 31, 2000
o       Statements of Income for the three years ended December 31, 2001
o       Statements of Changes in Partners' Capital for the three years ended
        December 31, 2001
o       Statements of Cash Flows for the three years ended December 31, 2001
o       Notes to Financial Statements

B. - Financial Statement Schedules

The following financial statement schedules of Redwood Mortgage Investors VI are
included in Item 8.

o        Schedule II     Valuation and Qualifying Accounts
o        Schedule IV     Mortgage Loans on Real Estate

     All  other  schedules  for  which  provision  is  made  in  the  applicable
accounting  regulations  of the  Securities  and  Exchange  Commission  are  not
required under the related instructions or are inapplicable,  and therefore have
been omitted.

<PAGE>



                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Parternship)
                              FINANCIAL STATEMENTS
                                DECEMBER 31, 2001







<PAGE>


                              ARMANINO McKENNA LLP
                          CERTIFIED PUBLIC ACCOUNTANTS
                        1855 Olympic Boulevard, Suite 225
                             Walnut Creek, CA 94596
                                 (925) 939-8500



                          INDEPENDENT AUDITORS' REPORT


THE PARTNERS
REDWOOD MORTGAGE INVESTORS VI
REDWOOD CITY, CALIFORNIA

     We  have  audited  the  accompanying  balance  sheet  of  REDWOOD  MORTGAGE
INVESTORS VI (A California Limited Partnership) as of December 31, 2001 and 2000
and the related  statements  of income,  changes in  partners'  capital and cash
flows for the two years  then  ended.  Our audit  also  included  the  financial
statement schedule listed in the Index at Item 8. These financial statements and
schedules  are  the   responsibility  of  the  partnership's   management.   Our
responsibility  is to  express  an opinion  on these  financial  statements  and
schedules based on our audits.

     We conducted our audits in accordance  with  auditing  standards  generally
accepted in the United States of America.  Those standards  require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements  are free of  material  misstatement.  An  audit  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  financial  statements.  An audit also  includes  assessing  the  accounting
principles  used  and  significant  estimates  made  by  management,  as well as
evaluating the overall  financial  statement  presentation.  We believe that our
audits provide a reasonable basis for our opinion.

     In our opinion,  the financial statements referred to above present fairly,
in all material  respects,  the financial position of REDWOOD MORTGAGE INVESTORS
VI as of December 31, 2001 and 2000,  and the results of its operations and cash
flows for the two years  then ended in  conformity  with  accounting  principles
generally  accepted in the United  States of America.  Also,  in our opinion the
related financial statement schedules,  when considered in relation to the basic
financial  statements taken as a whole,  present fairly in all material respects
the information set forth therein.


                            /s/ ARMANINO McKENNA LLP






Walnut Creek, California
February 28, 2002



<PAGE>



                        Caporicci, Cropper & Larson, LLP
                          CERTIFIED PUBLIC ACCOUNTANTS
                           1575 Treat Blvd, Suite 208
                             Walnut Creek, CA 94596
                                 (925) 932-3860



                          INDEPENDENT AUDITORS' REPORT


THE PARTNERS
REDWOOD MORTGAGE INVESTORS VI
REDWOOD CITY, CALIFORNIA

     We have audited the financial  statements and related  schedules of REDWOOD
MORTGAGE  INVESTORS VI (A California  Limited  Partnership)  listed in Item 8 on
form 10-K including the accompanying  statements of income, changes in partners'
capital and cash flows for the year ended  December  31, 1999.  These  financial
statements  are  the  responsibility  of  the  partnership's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audit.

     We conducted  our audit in  accordance  with  generally  accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

     In our opinion,  the financial statements referred to above present fairly,
in all material  respects,  the financial position of REDWOOD MORTGAGE INVESTORS
VI operations  and cash flows for the year ended December 31, 1999 in conformity
with generally accepted accounting  principles.  Further, it is our opinion that
the schedules referred to above present fairly the information set forth therein
in compliance with the applicable  accounting  regulations of the Securities and
Exchange Commission.


                              /s/ A. Bruce Cropper
                             Caporicci, Cropper & Larson, LLP










Walnut Creek, California
March 15, 2000


<PAGE>

                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                                 BALANCE SHEETS
                          DECEMBER 31, 2001 AND 2000

                                     ASSETS

                                                     2001                 2000
                                                --------------       -----------

Cash                                              $ 190,414            $ 354,860
                                                --------------       -----------

Loans
  Loans, secured by deeds of trust                4,970,433            5,570,576
  Loans, unsecured                                   82,362               82,362
                                                --------------       -----------
                                                  5,052,795            5,652,938
  Less allowance for doubtful accounts              370,612              261,452
                                                --------------       -----------
       Net loans                                  4,682,183            5,391,486
                                                --------------       -----------
Interest and other receivables
  Accrued interest and late fees                    761,473              664,292
  Advances on loans                                 197,946              133,647
                                                --------------       -----------
       Total interest and other receivables         959,419              797,939
                                                --------------       -----------

Note receivable - Redwood Mortgage Corp.            178,200              125,000
Real estate owned, held for sale, net
  of allowance                                    1,093,503              767,583
                                                --------------       -----------

       Total assets                            $  7,103,719           $7,436,868
                                                ==============       ===========


                        LIABILITIES AND PARTNERS' CAPITAL


Liabilities
  Accounts payable                                $  20,261            $  13,068
  Deferred interest                                  74,022                    -
                                                --------------       -----------
          Total liabilities                          94,283               13,068
                                                --------------       -----------

Partners' capital
  Limited partners' capital, subject
     to redemption                                6,999,670            7,414,034
  General partners' capital                           9,766                9,766
                                                --------------       -----------
    Total partners' capital                       7,009,436            7,423,800
                                                --------------       -----------

    Total liabilities and partners' capital      $7,103,719           $7,436,868
                                                ==============       ===========




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



<PAGE>


                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                              STATEMENTS OF INCOME
           FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 and 1999

<TABLE>

                                                                           YEARS ENDED DECEMBER 31,
                                                              ----------------------------------------------------
<S>                                                               <C>                 <C>               <C>
                                                                  2001                2000              1999
                                                              -------------       -------------     --------------
Revenues
  Interest - deeds of trust                                       $512,383           $ 597,996          $ 743,319
  Interest - interest bearing accounts                              12,927              17,021             14,086
  Interest on promissory note                                        4,912              16,091                  -
  Late charges, prepayment penalties, and fees                      27,478              29,101             28,912
  Mortgage servicer subsidy                                        178,200             125,000            300,000
                                                              -------------       -------------     --------------
                                                                   735,900             785,209          1,086,317
                                                              -------------       -------------     --------------

Expenses
  Loan servicing fees                                               41,406              48,557             50,150
  Asset management fees                                              9,115               9,780             10,626
  Clerical costs through Redwood Mortgage Corp.                     28,156              19,647             21,748
  Interest and line of credit costs                                      -                   -             14,714
  Provisions for losses on loans
      and real estate acquired through foreclosure                 201,036             193,427            437,558
  Professional services                                             19,866              25,462             18,068
  Other                                                              9,670              10,407             12,544
                                                              -------------       -------------     --------------
                                                                   309,249             307,280            565,408
                                                              -------------       -------------     --------------
Net income                                                        $426,651           $ 477,929          $ 520,909
                                                              =============       =============     ==============

Net income
   General partners (1%)                                          $  4,266            $  4,779           $  5,209
   Limited partners (99%)                                          422,385             473,150            515,700
                                                              -------------       -------------     --------------
                                                                  $426,651            $477,929           $520,909
                                                              =============       =============     ==============

Net income per $1,000 invested by limited partners for entire period:
  -where income is reinvested and compounded                           $59                 $62                $62
                                                              =============       =============     ==============

  -where partner receives income in monthly distributions              $58                 $61                $61
                                                              =============       =============     ==============


</TABLE>











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


<PAGE>


                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                   STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
             FOR THE YEARS ENDED DECEMBER 31, 2001, 2000, and 1999

                                      Limited          General
                                     Partners         Partners            Total
                                   -------------    ------------    ------------

Balances at December 31, 1998        $8,697,768         $9,766        $8,707,534

   Net income                           515,700          5,209           520,909
   Early withdrawal penalties          (10,028)              -          (10,028)
   Partners' withdrawals            (1,182,860)         (5,209)      (1,188,069)
                                   -------------    ------------    ------------

Balances at December 31, 1999         8,020,580          9,766         8,030,346

   Net income                           473,150          4,779           477,929
   Early withdrawal penalties          (16,335)              -          (16,335)
   Partners' withdrawals             (1,063,361)        (4,779)      (1,068,140)
                                   -------------    ------------    ------------

Balances at December 31, 2000         7,414,034          9,766         7,423,800
   Net income                           422,385          4,266           426,651
   Early withdrawal penalties           (15,024)             -          (15,024)
   Partners' withdrawals               (821,725)        (4,266)        (825,991)
                                   -------------    ------------    ------------

Balances at December 31, 2001        $6,999,670        $  9,766      $ 7,009,436
                                   =============    ============    ============















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


<PAGE>


                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                            STATEMENTS OF CASH FLOWS
             FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 and 1999

<TABLE>

                                                                        YEARS ENDED DECEMBER 31,
                                                           ---------------------------------------------------
<S>                                                            <C>                <C>                <C>
                                                               2001               2000               1999
                                                           -------------      --------------     -------------
Cash flows from operating activities
  Net income                                                   $426,651            $477,929          $520,909
  Adjustments to reconcile net income to
    net cash provided by operating activities
     Provision for doubtful accounts                            201,037              34,738           442,480
     Provision for losses (recovery) on real
            estate held for sale                                                    158,689           (4,922)
                                                                      -
     Early withdrawal penalties credited to income             (15,024)             (16,335)         (10,028)

         Change in operating assets and liabilities
                  Accrued interest and advances               (161,480)            (24,769)         (200,903)
                  Accounts payable and accrued expenses          7,192               13,068          (22,668)
                  Deferred interest on loans                    74,022             (15,676)           (4,787)
                                                           -------------      --------------     -------------
Net cash provided by operating activities                       532,398             627,644           720,081
                                                           -------------      --------------     -------------

Cash flows from investing activities
    Principal collected on loans                              2,548,178           2,058,681         2,859,900
    Loans made                                              (1,838,265)         (2,434,422)         (922,936)
    Payments for real estate held for sale                       60,872           (129,557)          (24,112)
    Proceeds on sale of real estate held for sale             (588,438)               5,359            65,656
                                                           -------------      --------------     -------------

Net cash provided by (used in) investing activities            182,347             (499,939)         1,978,508
                                                           -------------      --------------     -------------

Cash flows from financing activities
    Payments on notes                                          125,000              300,000         (390,000)
    Partners' withdrawals                                     (825,991)         (1,068,140)       (1,188,069)
    Note receivable - Redwood Mortgage Corp.                  (178,200)           (125,000)         (300,000)
                                                           -------------      --------------     -------------

Net cash used in financing activities                         (879,191)           (893,140)       (1,878,069)
                                                           -------------      --------------     -------------

Net increase (decrease) in cash                               (164,446)           (765,435)           820,520
Cash - beginning of year                                       354,860            1,120,295           299,775
                                                           -------------      --------------     -------------
Cash - end of year                                             $190,414            $354,860        $1,120,295
                                                           =============      ==============     =============
Cash paid for interest                                               $0                  $0           $14,714
                                                           =============      ==============     =============

</TABLE>

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


<PAGE>


                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2001


NOTE 1 - ORGANIZATION AND GENERAL

     Redwood Mortgage Investors VI, (the  "partnership") is a California Limited
Partnership,  of which the general  partners  are  Michael R.  Burwell and Gymno
Corporation,  a  California  corporation  owned and  operated on an equal 50/50%
basis by Michael R Burwell and by D. Russell Burwell,  a former general partner.
The partnership was organized to engage in business as a mortgage lender for the
primary  purpose of making loans  secured by Deeds of Trust on  California  real
estate.  Loans are being  arranged and serviced by Redwood  Mortgage  Corp.,  an
affiliate of the general partners.  The offering of partnership units was closed
with contributed capital totaling $9,781,366.

     Each  month's   income  is   distributed   to  partners  based  upon  their
proportionate share of partners' capital. Some partners have elected to withdraw
income on a monthly, quarterly or annual basis.

A. Sales Commissions - Formation Loan

     Sales  commissions  ranging from 0% (units sold by general partners) to 10%
of gross  proceeds  were paid by Redwood  Mortgage  Corp.  an  affiliate  of the
general  partners  that  arranges and  services the loans.  To finance the sales
commissions,  the  partnership  loaned to Redwood  Mortgage Corp.  $623,255 (the
"Formation  Loan")  relating  to the  contributed  capital  of  $9,781,366.  The
formation loan was unsecured,  and was repaid without  interest,  over 10 years,
commencing December 31, 1989. The last payment was made during 1998.

B. Other Organizational and Offering Expenses

     Organizational  and  offering  expenses,   other  than  sales  commissions,
including  printing costs,  attorney and accountant  expenses,  and other costs,
paid by the partnership from the offering  proceeds totaled $360,885 or 3.69% of
the gross  proceeds  contributed by the limited  partners.  Such costs have been
fully amortized and allocated to the limited partners.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. Accrual Basis

     Revenues and expenses are  accounted for on the accrual basis of accounting
wherein  income is recognized as earned and expenses are recognized as incurred.
Once a loan is categorized as impaired,  interest is no longer accrued  thereon.
Any  subsequent  payments  on  impaired  loans are  applied  to the  outstanding
balances on the partnership's books.

B. Management Estimates

     In  preparing  the  financial  statements,  management  is required to make
estimates based on the information available that affect the reported amounts of
assets and  liabilities  as of the balance  sheet date and revenues and expenses
for the related periods.  Such estimates relate principally to the determination
of the  allowance  for doubtful  accounts,  including  the valuation of impaired
loans,  and the valuation of real estate acquired  through  foreclosure.  Actual
results could differ significantly from these estimates.


<PAGE>


                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2001

C. Loans, Secured by Deeds of Trust

     The  partnership  has both the  intent  and  ability  to hold the  loans to
maturity, i.e., held for long-term investment. They are therefore valued at cost
for financial  statement  purposes  with  interest  thereon being accrued by the
effective interest method.

     Financial  Accounting Standards Board Statements (SFAS) 114 and 118 provide
that if the probable  ultimate  recovery of the carrying  amount of a loan, with
due  consideration  for the fair value of collateral,  is less than the recorded
investment and related  amounts due and the impairment is considered to be other
than temporary, the carrying amount of the investment (cost) shall be reduced to
the present value of future cash flows.

     At December 31, 2001 and 2000, there were loans  categorized as impaired by
the  partnership of $2,467,891  and  $2,469,505,  respectively.  In addition the
impaired loans have accrued interest and advances totaling $828,967 and $744,127
at  December  31,  2001 and 2000.  The  decrease  in the  carrying  value of the
impaired  loans of  $287,985,  and  $159,090  at  December  31,  2001 and  2000,
respectively  is included in the  allowance for doubtful  accounts.  The average
recorded  investment  in the  impaired  loans was  $2,468,698,  $2,470,686,  and
$2,471,869 for the years ended December 31, 2001, 2000, and 1999,  respectively.
During the year ended  December  31, 2001 and 2000,  $189,690  and  $158,761 was
received as cash payments on these loans, respectively.

     As  presented  in Note 10 to the  financial  statements  as of December 31,
2001, the average loan to appraised value of security at the time the loans were
consummated  at December  31,  2001 and 2000 was 71.27 and 68.93%  respectively.
When a loan is  valued  for  impairment  purposes,  an  updating  is made in the
valuation of  collateral  security.  However,  this loan to value ratio tends to
minimize reductions for impairment.

D. Cash and Cash Equivalents

     The partnership  considers all highly liquid  financial  instruments with a
maturity of three months or less to be cash equivalents.

     The partnership  maintains  deposits in financial  institutions that are in
excess of amounts that would be covered by federal insurance. The maximum amount
of loss based upon the  deposits  held in the bank that could  result  from this
risk at  December  31,  2001 and 2000 is  approximately  $130,439  and  $154,860
respectively.

E. Real Estate Owned, Held for Sale

     Real estate owned,  held for sale,  includes real estate  acquired  through
foreclosure  and is  stated  at the  lower  of the  recorded  investment  in the
property,  net of any senior  indebtedness,  or at the property's estimated fair
value, less estimated costs to sell.


<PAGE>


                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2001

The following schedule reflects the costs of real estate acquired through
foreclosure and the recorded reductions to estimated fair values, less estimated
costs to sell:
                                                      December 31,
                                         ---------------------------------------
                                                2001                   2000
                                          ---------------          -------------

Costs of properties                        $1,627,696                $1,240,579
Reduction in value                           (534,193)                 (472,996)
                                          ---------------          -------------

Fair value reflected in
     financial statements                   1,093,503                  $767,583
                                          ===============          =============

F. Income Taxes

No provision for Federal and State income taxes is made in the financial
statements since income taxes are the obligation of the partners if and when
income taxes apply.


G. Allowance for Doubtful Accounts

     Loans and the related accrued interest, fees and advances are analyzed on a
continuous basis for  recoverability.  Delinquencies are identified and followed
as part of the loan  system.  A  provision  is made for bad debt to  adjust  the
allowance  for doubtful  accounts to an amount  considered  by  management to be
adequate with due consideration to collateral value to provide for unrecoverable
accounts  receivable,  including  impaired  loans,  unspecified  loans,  accrued
interest and advances on loans, and other accounts receivable  (unsecured).  The
composition  of the allowance for doubtful  accounts as of December 31, 2001 and
2000 was as follows:
                                                            December 31,
                                                --------------------------------
                                                 2001                   2000
                                            ---------------        -------------

Impaired loans                                  $287,985               $159,090
Unspecified loans                                    265                 20,000
Accounts receivable, unsecured                    82,362                 82,362
                                            ---------------        -------------
                                                $370,612               $261,452
                                            ===============        =============

Allowance for Doubtful Accounts Reconciliation:
Activity in the allowance for doubtful accounts is as follows for the years
ending December 31:

                                           2001            2000           1999
                                      ------------     -----------   -----------
Beginning Balance                      $261,452         $303,249       $202,344
Provision for bad debt                  109,160           34,738        542,845
Write-off of bad debt                        -           (76,535)      (441,940)
                                      ------------     -----------   -----------
Ending Balance                         $370,612          $261,452      $303,249
                                      ------------     -----------   -----------




<PAGE>


                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2001

H. Net Income Per $1,000 Invested

     Amounts  reflected  in the  statements  of income as net  income per $1,000
invested by limited partners for the entire period are actual amounts  allocated
to limited  partners who held their  investment  throughout  the period and have
elected to either  leave their  earnings to compound or have  elected to receive
monthly  distributions of their net income.  Individual income is allocated each
month  based on the  limited  partners'  pro rata  share of  partners'  capital.
Because the net income percentage varies from month to month, amounts per $1,000
will vary for those  individuals  who made or  withdrew  investments  during the
period, or select other options.

I. Late Fee Revenue

     The partnership  recognizes  late fee revenue when it is earned.  Late fees
are charged at 6% of the monthly  balance,  and are accrued net of an  allowance
for  uncollectible  late fees. For the year ended  December 31, 2001,  2000, and
1999 late fee  revenue of  $27,748,  $29,101,  and  $28,912,  respectively,  was
recorded.

NOTE 3 - GENERAL PARTNERS AND RELATED PARTIES

The following are commissions and/or fees, which are paid to the general
partners and/or related parties.

A. Mortgage Brokerage Commissions

     For fees in connection with the review, selection, evaluation,  negotiation
and extension of the loans the partnership  may collect an amount  equivalent to
12% of the  loaned  amount  until 6 months  after  the  termination  date of the
offering.  Thereafter, loan brokerage commissions (points) will be limited to an
amount  not to exceed  4% of the total  partnership  assets  per year.  The loan
brokerage commissions are paid by the borrowers, and thus, are not an expense of
the partnership.  Such commissions totaled $46,581, $45,164, and $46,527 for the
years ended December 31, 2001, 2000 and 1999 respectively.

B. Mortgage Servicing Fees

     Redwood Mortgage Corp.  receives  monthly mortgage  servicing fees of up to
1/8 of 1% (1.5%  annual) of the unpaid  principal,  or such lesser  amount as is
reasonable and customary in the geographic area where the property  securing the
loan is located.  Mortgage servicing fees of $41,406, $48,556, and $50,150, were
incurred for years ended December 31, 2001, 2000 and 1999, respectively.

C. Asset Management Fee

     The general  partners  receive monthly fees for managing the  partnership's
loan  portfolio and operations of up to 1/32 of 1% of the "net asset value" (3/8
of 1% annually).  Management fees of $9,115,  $9,780,  and $10,626 were incurred
for the years 2001, 2000, and 1999, respectively.

D. Other Fees

     The  Partnership  Agreement  provides for other fees such as  reconveyance,
mortgage  assumption and mortgage extension fees. These fees are incurred by the
borrowers and paid to the general partners.

E. Income and Losses

     All income and losses are  credited  or charged to  partners in relation to
their respective partnership interests.  The partnership interest of the general
partners (combined) is a total of 1%.


<PAGE>


                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2001
F. Operating Expenses

     The  general  partners  or their  affiliate  (Redwood  Mortgage  Corp.) are
reimbursed by the partnership for all operating  expenses  actually  incurred by
them on behalf of the partnership,  including without limitation,  out-of-pocket
general and  administration  expenses of the  partnership,  accounting and audit
fees,  legal fees and expenses,  postage and  preparation  of reports to limited
partners. In 2001, 2000 and 1999, clerical costs totaling $28,156,  $19,647, and
$21,748,  respectively,  were  reimbursed  to  Redwood  Mortgage  Corp.  and are
included in expenses in the Statements of Income.

G.       Contributed Capital

     The general  partners jointly or severally were to contribute 1/10 of 1% in
cash  contributions as proceeds from the offerings are received from the limited
partners. . As of December 31, 1989, a general partner,  GYMNO Corporation,  had
contributed  $9,772,  1/10 of 1% of limited partner  contributions in accordance
with the Partnership Agreement.

NOTE 4 - OTHER PARTNERSHIP PROVISIONS

A. Term of the Partnership

     The term of the  partnership  is  approximately  40  years,  unless  sooner
terminated as provided.  The provisions  provided for no capital  withdrawal for
the first five years,  subject to the penalty  provision set forth in (D) below.
Thereafter,  partners  have the right to withdraw  over a five-year  period,  or
longer.

B. Election to Receive Monthly, Quarterly or Annual Distributions

     Upon subscriptions,  investors elected either to receive monthly, quarterly
or  annual  distributions  of  earnings  allocations,  or to allow  earnings  to
compound  for at least a period of 5 years.  Subject to certain  limitations,  a
compounding  investor may  subsequently  change his election,  but an investor's
election to have cash distributions is irrevocable.

C. Profits and Losses

     Profits  and  losses  are  allocated  monthly  among the  limited  partners
according  to their  respective  capital  accounts  after 1% is allocated to the
general partners.

D. Withdrawal From Partnership

     A limited  partner  had no right to  withdraw,  without  penalty,  from the
partnership  or to obtain the return of his  capital  account  for at least five
years after such units are  purchased  which in all  instances  had  occurred by
December 31,  1994.  After that time,  at the  election of the partner,  capital
accounts  can  be  returned  over  a  five-year  period  in 20  equal  quarterly
installments or such longer period as is requested.

     Notwithstanding  the  above,  in order  to  provide  a  certain  degree  of
liquidity to the limited partners, the general partners will liquidate a limited
partner's entire capital account in four quarterly installments beginning on the
last day of the calendar  quarter  following  the quarter in which the notice of
withdrawal is given. Such liquidations shall, however, be subject to a 10% early
withdrawal  penalty applicable to any sums withdrawn prior to the time when such
sums otherwise could have been withdrawn  pursuant to the liquidation  procedure
set forth above. The 10% early withdrawal penalties collected by the partnership
are  currently  credited to income since the  syndication  costs have been fully
allocated and the formation loan has been entirely paid.


<PAGE>



                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2001

     The partnership will not establish a reserve from which to fund withdrawals
and,  accordingly,  the  partnership's  capacity  to return a limited  partner's
capital  account is restricted to the  availability  of  partnership  cash flow.
Furthermore,  no more than 20% of the total limited  partners'  capital accounts
outstanding at the beginning of any year shall be liquidated during any calendar
year.

NOTE  5 - NOTE RECEIVABLE - REDWOOD MORTGAGE CORP.

     Redwood Mortgage Corp., an affiliate of the general partners which arranges
and services the loans of the partnership, has subsidized certain loan losses of
the partnership in the form of a note receivable.  The note bears interest at 8%
and will be paid over a three-year period to the extent that partnership  losses
occur relative to certain identified  properties.  If the identified  properties
recover  from their  write-downs,  Redwood  Mortgage  Corp.  will be credited or
reimbursed up to the amount of the note receivable.  Mortgage servicer subsidies
for the years  2001,  2000,  and 1999 were  $178,200,  $125,000,  and  $300,000,
respectively.


NOTE 6 - LEGAL PROCEEDINGS

     The  partnership is involved in various legal actions arising in the normal
course of business.  In the opinion of management,  such matters will not have a
material effect upon the financial position of the partnership.

NOTE 7 - INCOME TAXES

The following reflects a reconciliation from net assets (partners' capital)
reflected in the financial statements to the tax basis of those net assets:


                                                          December 31,
                                                --------------------------------
                                                  2001                  2000
                                               ----------             ----------

Net assets - partners' capital
    per financial statements                 $7,009,436              $7,423,800

Allowance for doubtful accounts                 370,612                 261,452
                                          ---------------         --------------
Net assets tax basis                         $7,380,048              $7,685,252
                                          ===============         ==============

     In 2001 and  2000,  approximately  73% and 73%,  respectively,  of  taxable
income was allocated to tax exempt  organizations  i.e.,  retirement plans. Such
plans do not have to file income tax returns  unless their  "unrelated  business
income" exceeds $1,000.  Applicable  amounts become taxable when distribution is
made to participants.


<PAGE>



                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2001

NOTE 8 - FAIR VALUE OF FINANCIAL INSTRUMENTS

The  following  methods and assumptions  were used to estimate the fair value of
financial instruments:

     (a) Cash and cash  equivalents - The carrying amount equals fair value. All
amounts,   including   interest-bearing   accounts   are  subject  to  immediate
withdrawal.

     (b) Loans - (see note 2 (c)) carrying  value was  $4,970,433 and $5,570,576
at December 31, 2001 and 2000 respectively.  The fair value of these investments
of $5,036,556  and  $5,639,252  was estimated  based upon  projected  cash flows
discounted at the estimated  current interest rates at which similar loans would
be made. The applicable amount of the allowance for doubtful accounts along with
accrued  interest and advances  related  thereto  should also be  considered  in
evaluating the fair value versus the carrying value.


NOTE 9 - ASSET CONCENTRATIONS AND CHARACTERISTICS

The loans are secured by recorded deeds of trust. At December 31, 2001 and 2000,
there  were  27 and  31  loans  outstanding,  respectively,  with  the following
characteristics:

                                                           2001          2000
                                                          ------        ------
Number of loans outstanding                                   27            31
Total loans outstanding                               $4,970,433    $5,570,576

Average loan outstanding                                $184,090      $179,696
Average loan as percent of total                           3.70%         3.23%
Average loan as percent of partners' capital               2.63%         2.42%

Largest loan outstanding                              $1,376,117    $1,376,117
Largest loan as percent of total                          27.69%        24.70%
Largest loan as percent of partners' capital              19.63%        18.54%

Number of counties where security is located
   (all California)                                           10             9
Largest percentage of loans in one county                 40.75%        38.75%
Average loan to appraised value of security
    at time loan was consummated                          71.27%        68.93%

Number of loans in foreclosure                                 3             2
Amount of loans in foreclosure                          $439,311      $354,195



<PAGE>



                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2001


The following categories of loans were held at December 31, 2001 and 2000:

                                                          December 31,
                                                --------------------------------
                                                    2001              2000
                                               -------------      --------------
First Trust Deeds                             $  3,770,088          $ 4,011,117
Second Trust Deeds                               1,136,481            1,385,496
Third Trust Deeds                                   63,864              173,963
                                               -------------      --------------
  Total loans                                    4,970,433            5,570,576
Prior liens due other lenders                    5,627,002            8,467,477
                                               -------------      --------------
  Total debt                                  $ 10,597,435          $14,038,053
                                               =============      ==============

Appraised property value at time of loan      $ 14,868,548          $20,364,599
                                               =============      ==============

Total investments as a percent of appraisals         71.27%               68.93%
                                               =============      ==============

Investments by type of property

Owner occupied homes                            $   741,154          $  755,014
Non-owner occupied homes                            181,952             672,518
Apartments                                          562,015             575,407
Commercial                                        3,485,312           3,567,637
                                               -------------      --------------
                                               $  4,970,433         $ 5,570,576
                                               =============      ==============


<PAGE>

                          REDWOOD MORTGAGE INVESTORS VI
                       (A California Limited Partnership)
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2001

Scheduled maturity dates of loans as of December 31, 2001 are as follows:

                         Year Ending
                         December 31,
                      -------------------
                             2002                                  $ 3,306,702
                             2003                                      434,479
                             2004                                      741,154
                             2005                                       40,125
                             2006                                       96,716
                          Thereafter                                   351,257
                                                              -----------------
                                                                   $ 4,970,433
                                                              =================

     The scheduled  maturities for 2002 include eight loans totaling  $2,935,731
(59%) which are past maturity at December 31, 2001. Of these loans,  three loans
totaling $439,311 (8.84%) were categorized as delinquent over 90 days.

     The cash  balance at December  31,  2001 of  $230,439  was in one bank with
interest  bearing  balances  totaling  $167,312.   The  balances  exceeded  FDIC
insurance limits (up to $100,000 per bank) by $130,439.

Workout Agreements

     The partnership has negotiated various  contractual workout agreements with
borrowers  whose  loans  are  past  maturity  or who are  delinquent  in  making
payments.  The  partnership  is not  obligated  to fund  additional  money as of
December 31, 2001. As of December 31, 2001 the partnership  had  approximately 8
loans totaling  $2,652,764 of which 5 of these totaling $2,401,070 were paid off
by March 15, 2002.


<PAGE>


SCHEDULE II

                          REDWOOD MORTGAGE INVESTORS VI
<TABLE>
                        VALUATION AND QUALIFYING ACCOUNTS

<S>                 <C>                       <C>                   <C>                    <C>
Col. A              Col. B                    Col. C                Col. D                 Col. E
Description         Balance                 Additions             Deductions              Balance at
                    Beginning          ---------------------       Describe             End of Period
                    of Period
                                          (1)          (2)
                                       Charged     Charged to
                                         to         Other
                                       Costs  &    Accounts
                                       Expenses    Describe
Year Ended
12/31/01

Deducted from
Asset
Accounts:

Allowance for
Doubtful
     Accounts         $261,452           $109,160       $-               $- (b)
                                                                                           $370,612

Cumulative
write-down of
Real Estate
   held for
   Sale (REO)       $473,710 (a)         $91,913        $-      $(31,430) (b)                $534,193
                    --------------     -----------    -----    -----------------    --------------------

Total               $735,162(a)         $201,073        $-      $(31,430) (b)                $904,805
                    ==============     ===========    =====     =================    ====================

</TABLE>


Note             (a) - The beginning balance (Col B) includes $287,548 write
                 down of Real Estate in the process of becoming REO at December
                 31,1999.

Note (b) - Write-offs of loans/properties during the year.




<PAGE>


SCHEDULE IV

                                                 MORTGAGE LOANS ON REAL ESTATE.
                                                RULE 12-29 LOANS ON REAL ESTATE
<TABLE>

<S>         <C>        <C>          <C>            <C>            <C>              <C>            <C>        <C>         <C>
 Col. A     Col. B     Col. C       Col. D         Col. E         Col. F           Col. G         Col. H     Col. I      Col. J
  Desc.   Interest   Final        Periodic     Prior Liens    Face Amount of      Carrying      Principal    Type      Geographic
            Rate %    maturity     Payment                     Loan (original   Amount of Loan   Amount of    of Lien     County
                        Date        Terms                          amount)                         Loans                 Location
                                                                                                 Subject to
                                                                                                 Delinquent
                                                                                                 Principal
                                                                                                or Interest
---------- ---------- ---------- ------------- --------------- ---------------- --------------- ------------- -------- -------------

Comm.     14.75%  09/01/95     $2,241.96       $250,000.00    $185,000.00      $176,471.62             -        2nd   San Mateo
Apts.      6.50%  05/01/06        540.83        89,904.00      100,000.00        96,716.11     27,582.33        2nd   Sacramento
Comm.     10.00%  12/01/98      5,046.04                -      575,000.00       563,881.68             -        1st    Alameda
Comm.      7.00%  12/01/03      1,151.48       562,500.00       99,172.75        81,121.58     56,422.52        2nd    Alameda
Comm.     12.00%  02/01/99     14,025.12                -    1,376,117.03     1,376,117.03             -        1st  Santa Clara
Apts.      7.00%  02/10/05        234.06        80,250.00       40,125.00        40,125.00             -        2nd San Francisco
Comm.      9.00%  05/10/02        670.52                -       83,333.33        78,557.42             -        1st     Shasta
Comm.     12.00%  02/01/11        756.11                -       63,000.00        50,372.60             -        1st    Alameda
Res.       8.00%  09/18/03        166.58                -       22,701.51        21,455.93             -        1st     Sonoma
Res.       8.00%  09/30/03        170.67                -       23,259.09        22,039.71             -        1st     Sonoma
Comm.     12.00%  02/01/99        508.40     1,279,200.00       49,200.00        49,200.00             -        2nd  Santa Clara
Apts.      7.00%  08/01/02      1,545.83                -      265,000.00       260,228.74             -        1st   Sacramento
Apts       7.00%  08/01/03      1,022.35                -      153,660.00       147,999.38             -        1st   Sacramento
Apts.      9.00%  02/01/99         38.42       153,534.00        5,122.00         2,156.97             -        2nd   Sacramento
Apts.     13.00%  11/01/03        759.15       341,094.00       60,000.00        14,789.24             -        2nd San Francisco
Comm.     11.50%  05/01/99      3,113.39                -      314,000.00       300,854.39     37,360.68        1st    Alameda
Res.      12.00%  05/01/01        745.93       600,000.00       74,592.87        74,592.87             -        2nd     Placer
Comm.     10.00%  12/01/03      1,276.47                -      145,454.55       144,916.12      5,105.88        1st   Stanislaus
Comm.     10.00%  12/01/01        283.66       208,012.00       32,323.23        32,184.52             -        2nd   Stanislaus
Land      12.00%  12/01/01      3,307.50                -      330,750.00       330,750.00             -        1st  Santa Clara
Res       13.00%  05/01/01        691.86       674,593.00       63,863.76        63,863.76             -        3rd     Placer
Res       11.00%  02/01/04      3,380.22                -      363,700.00       363,653.70             -        1st San Francisco
Comm.     11.50%  06/01/09      1,901.36        42,294.00      192,000.00       191,622.67             -        2nd   San Mateo
Comm.     10.00%  07/01/11        997.47                -      109,768.75       109,261.90             -        1st  Santa Clara
Res       11.50%  07/01/01      1,629.17       502,305.00      170,000.00       170,000.00             -        2nd    Tuolumne
Res       11.00%  11/01/04        485.42       127,188.91      285,000.00        47,500.00             -        2nd   San Mateo
Res       11.00%  12/01/04      1,466.69       716,126.57      250,000.00       160,000.00             -        2nd  Santa Clara
                          -----------------------------------------------------------------------------
                              $48,156.66    $5,627,001.48   $5,432,143.87    $4,970,432.94   $126,471.41
                          =============================================================================
</TABLE>

     Notes:  Loans  classified  as  impaired  had  principal  balances  totaling
$2,467,891.  Impaired  loans are  defined  as loans  where the costs of  related
balances exceeds the anticipated  fair value less costs to collect.  Interest is
no longer accrued thereon.

     Amounts  reflected in column G (carrying  amount of loans)  represents both
costs and the tax basis of the loans.


<PAGE>


Schedule IV

Reconciliation of carrying amount (cost) of loans at close of periods
<TABLE>

                                                               Year ended December 31,
                                              ----------------------------------------------------------
<S>                                               <C>                   <C>                   <C>
                                                  2001                  2000                  1999
                                              --------------       ---------------      -----------------
Balance at beginning of year                   $5,570,576              $5,282,773             $7,969,735
                                            --------------         ---------------      -----------------
Additions during period:
  New loans                                     1,838,266               2,434,422                922,936
  Other                                           109,769                       -                      -
                                                                   ---------------      -----------------
                  Total Additions              $1,948,035              $2,434,422               $922,936
                                            --------------         ---------------      -----------------


Deductions during period:
  Collections of principal                      2,548,178               2,058,681              2,859,900
  Foreclosures                                          -                       -                499,999
  Cost of loans sold                                    -                       -
  Amortization of Premium                               -                       -                      -
  Other                                                 -                  87,938                249,999
                                            --------------         ---------------      -----------------
                  Total Deductions              2,548,178               2,146,619              3,609,898
                                            --------------         ---------------      -----------------

Balance at close of year                       $4,970,433              $5,570,576             $5,282,773
                                            ==============         ===============      =================

</TABLE>

<PAGE>


Item 9 - Changes in and Disagreements with Accountants on Accounting and
         Financial Disclosure.

     Bruce and/or John Cropper (the  Croppers)  have been  performing  audit and
accounting  services  to the  general  partners  of the  partnership  and  their
affiliates for over 17 years.  They have been providing  auditing and accounting
services to the  partnership  for the past 15 years  through the  following  CPA
firms: 1987-1998 - Parodi & Cropper, CPA's; 1999 - Caporicci,  Cropper & Larson,
LLP and 2000-2001 - Armanino McKenna LLP.


     Bruce and John  Cropper  were  shareholders  in Cropper  Accountancy  Corp.
through December 31, 2000.

     Cropper Accountancy was a partner in the firm of Parodi & Cropper from 1987
until  April  of 1998.  In May of  1998,  Cropper  Accountancy  Corp.,  formed a
partnership  with Caporicci & Larson  creating a new firm with offices in Irvine
and Walnut Creek, California. The Parodi & Cropper firm was dissolved.

     Effective January 1, 2001,  Cropper  Accountancy  Corp.,  withdrew from the
Caporicci,  Cropper & Larson,  LLP  partnership.  John Cropper joined the larger
regional firm of Armanino  McKenna LLP as a partner and Bruce Cropper  continues
to provide services through Cropper  Accountancy.  As a result,  the partnership
has  retained  the firm of  Armanino  McKenna,  LLP,  to  provide  its audit and
financial services.  Thus, although there has been a change in accounting firms,
there  has not  been a  change  in  accountants  and  there  have  not  been any
disagreements  on any matter of  accounting  principals,  practices or financial
status disclosures.

                                    Part III

Item 10 - Directors and Executive Officers of the Registrant.

     The partnership has no Officers or Directors. Rather, the activities of the
partnership  are managed by the two general  partners of which one individual is
Michael  R.  Burwell.  The  second  general  partner  is  Gymno  Corporation,  a
California  corporation,  formed  in  1986.  Mr.  Burwell  is  one  of  the  two
shareholders of Gymno Corporation, a California corporation, on an equal (50-50)
basis.


Item 11 - Executive Compensation

     COMPENSATION OF THE GENERAL PARTNERS AND AFFILIATES BY PARTNERSHIP

     As  indicated  above  in  item  10,  the  partnership  has no  officers  or
directors. The partnership is managed by the general partners. There are certain
fees and other items paid to  management  and related  parties.  A more complete
description of management compensation is found in the Prospectus,  pages 11-12,
under the section  "Compensation  of the General  Partners and the  Affiliates",
which is incorporated by reference. Such compensation is summarized below.

     The  following  compensation  has been  paid to the  general  partners  and
affiliates  for services  rendered  during the year ended December 31, 2001. All
such compensation is in compliance with the guidelines and limitations set forth
in the Prospectus.

Entity Receiving       Description of Compensation                    Amount
Compensation           and Services Rendered
----------------       ---------------------------                -------------
I.
Redwood Mortgage       Loan Servicing Fee for
Corp.                  servicing loans Investments                      $41,406

General Partners
 &/or Affiliates       Asset Management Fee for managing assets          $9,115

General Partners       1% interest in profits                            $4,266


II.FEES PAID BY BORROWERS ON LOANS PLACED BY COMPANIES RELATED TO THE GENERAL
  PARTNERS WITH THE  PARTNERSHIP  (EXPENSES OF BORROWERS NOT OF THE PARTNERSHIP)

Redwood Mortgage      Mortgage Brokerage Commissions for services in
Corp.                 connection with the review, selection, evaluation,
                      negotiation, and extension of the loans paid by the
                      borrowers and not by the partnership              $46,581

Redwood Mortgage      Processing and Escrow Fees for services in
Corp.                 connection with notary, document preparation,
                      credit investigation, and escrow fees payable by
                      the borrowers and not by the partnership           $2,300

Gymno Corporation,
Inc.                  Reconveyance Fee                                     $804


III. IN ADDITION, THE GENERAL PARTNERS AND/OR RELATED COMPANIES PAY CERTAIN
     EXPENSES ON BEHALF OF THE  PARTNERSHIP FOR WHICH IT IS REIMBURSED AS NOTED
     IN THE STATEMENT OF INCOME                                         $28,156




<PAGE>



Item 12 - Security Ownership of Certain Beneficial Owners and Management

     The  general  partners  receive  a  combined  total  of  a 1%  interest  in
partnership   income  and  losses  and   distributions  of  cash  available  for
distribution.

Item 13 - Certain Relationships and Related Transactions

     Refer to footnote 3 of the notes to Financial  Statements in Part II item 8
which describes related party fees and data.

     Also refer to sections of the Prospectus  "Compensation of General Partners
and Affiliates",  page 11, and "Conflicts of Interest",  page 13, as part of the
above-referenced Registration Statement which is incorporated by reference.


                                     Part IV

Item 14 - Exhibits, Financial Statements Schedules, and Reports on Form 8-K

(A)      Documents filed as part of this report:

         1.  The Financial Statements are listed in Part II, Item 8 under
             A-Financial Statements.

         2.  The Financial Statement Schedules are listed in Part II, Item 8
             under B-Financial Statement Schedules.

         3.  Exhibits.

Exhibit No.                Description of Exhibits

      3.1           Limited Partnership Agreement
      3.2           Form of Certificate of Limited Partnership Interest
      3.3           Certificate of Limited Partnership
     10.1           Escrow Agreement (1)
     10.2           Servicing Agreement (1)
     10.3           (a) Form of Note secured by Deed of Trust which provides for
                    principal and interest payments (1)
                    (b) Form of Note secured by Deed of Trust which provides
                    principal and interest payments and right of assumption (1)
                    (c) Form of Note secured by Deed of Trust which provides for
                    interest only payments (1)
                    (d) Form of Note (1)
     10.4           (a) Deed of Trust and Assignment of Rents to accompany
                    Exhibits 10.3 (a) and (c) (1)
                    (b) Deed of Trust and Assignment of Rents to accompany
                    Exhibits 10.3 (b) (1)
                    (c) Deed of Trust to accompany Exhibit 10.3 (d) (1)
     10.5           Promissory Note for Formation Loan (1)
     10.6           Agreement to Seek a Lender (1)


     All of these exhibits were previously filed as the exhibits to Registrant's
Statement on Form S-11 (Registration No. 33-12519) and incorporated by reference
herein.


<PAGE>


(B)      Reports on form 8-K

         No reports on Form  8-K have been filed  during the last quarter of the
         period covered by this report. A Form 8-K was filed on February 7, 2000
         relating to a change in  accounting firm. Another Form 8-K was filed on
         February 13, 2001, relating to the subsequent change in accounting firm
         (see Item 9 above).

(C)      See (A) 3 above

(D)      See (A) 2  above.  Additional  reference is  made to  prospectus (S-11)
         dated September 3, 1987 to  pages 56 through 59 and supplement #6 dated
         May 16, 1989 pages 16-18, for financial data related  to Gymno Corpora-
         tion, a general partner.


                                   Signatures

     Pursuant  to the  requirements  of Section  13 or 15 (d) of the  Securities
Exchange Act of 1934 the  registrant has duly caused this report to be signed on
its behalf by the undersigned, thereto duly authorized on the 26th day of March,
2002.

REDWOOD MORTGAGE INVESTORS VI

By:       /S/ Michael R. Burwell
          -----------------------------------
          Michael R. Burwell, General Partner


By:       Gymno Corporation, General Partner




          By:     /S/ Michael R. Burwell
                  ---------------------------------------------
                  Michael R. Burwell, President, Secretary &
                  Chief Financial Officer


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following person on behalf of the registrant and in
the capacity indicated on the 26th day of March, 2002.

Signature                                Title                          Date


/S/ Michael R. Burwell
----------------------
Michael R. Burwell                 General Partner               March 26, 2002




/S/ Michael R. Burwell
----------------------
Michael R. Burwell          President, Secretary & Chief         March 26, 2002
                             Financial Officer of Gymno
                            Corporation (Principal Financial
                                and Accounting Officer);
                             Director of Gymno Corporation