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UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549


Form 10-K


|           |  |                                                                                             
|---------- |  | --------------------------------------------------------------------------------------------
|(Mark One) |  |                                                                                             
|o          |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934    
|Or        
|          
|þ          |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
|           |  | For the transition period from October 1, 2004 to
    June 30, 2005                         

Commission File Number 333-32800


VESTIN FUND I, LLC


(Exact name of registrant as specified in its charter)


|                                                                   |  |                                         
|------------------------------------------------------------------ |  | ----------------------------------------
|NEVADA                                                             |  | 88-0446244                              
|(State or other jurisdiction of
    Incorporation or organization) |  | (I.R.S. Employer
    Identification No.)

|                                                                                    |  |                
|----------------------------------------------------------------------------------- |  | ---------------
|8379 WEST SUNSET RD.,
    LAS VEGAS, NEVADA(Address of principal executive offices) |  | 89113(Zip Code)

Registrants telephone number, including area code
702.227.0965


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


NONE


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


NONE


þ o


þ


þ o


o þ














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TABLE OF CONTENTS


|              |  |                                                                                                |    |      |    | 
|------------- |  | ---------------------------------------------------------------------------------------------- | -- | ---- | -- | 
|              |  |                                                                                                |    | Page |   
|              |  |                                                                                                |    |      |   
|PART I       
|ITEM 1.       |  | BUSINESS                                                                                       |    |      | 3  | 
|ITEM 2.       |  | PROPERTIES                                                                                     |    |      | 13 | 
|ITEM 3.       |  | LEGAL PROCEEDINGS                                                                              |    |      | 13 | 
|ITEM 4.       |  | SUBMISSION OF MATTERS TO A VOTE OF SECURITY
    HOLDERS                                        |    |      | 14 | 
|             
|PART II      
|ITEM 5.       |  | MARKET FOR REGISTRANTS COMMON EQUITY
    AND RELATED STOCKHOLDER MATTERS                      |    |      | 14 | 
|ITEM 6.       |  | SELECTED FINANCIAL DATA                                                                        |    |      | 15 | 
|ITEM 7.       |  | MANAGEMENTS DISCUSSION AND ANALYSIS
    OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS      |    |      | 15 | 
|ITEM 7A.      |  | QUANTITATIVE AND QUALITATIVE DISCLOSURES
    ABOUT MARKET RISK                                 |    |      | 37 | 
|ITEM 8.       |  | FINANCIAL STATEMENTS AND SUPPLEMENTARY
    DATA                                                |    |      | 38 | 
|ITEM 9.       |  | CHANGES IN AND DISAGREEMENTS WITH
    ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE       |    |      | 38 | 
|ITEM 9A.      |  | CONTROLS AND PROCEDURES                                                                        |    |      | 38 | 
|ITEM 9B.      |  | OTHER INFORMATION                                                                              |    |      | 42 | 
|             
|PART III     
|ITEM 10.      |  | DIRECTORS AND EXECUTIVE OFFICERS OF
    REGISTRANT                                             |    |      | 42 | 
|ITEM 11.      |  | EXECUTIVE COMPENSATION                                                                         |    |      | 44 | 
|ITEM 12.      |  | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
    OWNERS AND MANAGEMENT RELATED STOCKHOLDER MATTERS |    |      | 44 | 
|ITEM 13.      |  | CERTAIN RELATIONSHIPS AND RELATED
    TRANSACTIONS                                             |    |      | 44 | 
|ITEM 14.      |  | PRINCIPAL ACCOUNTING FEES AND SERVICES                                                         |    |      | 45 | 
|             
|PART IV      
|ITEM 15.      |  | EXHIBITS AND FINANCIAL STATEMENT
    SCHEDULES                                                 |    |      | 46 | 
|EXHIBIT INDEX |  |                                                                                                | 47 |     
|SIGNATURES    |  |                                                                                                | 48 |     
|Exhibit 10.1 
|EX-31.1      
|EX-31.2      
|EX-32        



2



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PART I


Note Regarding Forward Looking Statements









|        |         
|------- | --------
|ITEM 1. | BUSINESS

General
















3



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| |   |                                                                                            
| | - | -------------------------------------------------------------------------------------------
| |  | Produce revenues from the interest income on our real estate
    loans;                    
|
| |  | Provide monthly cash distributions from the net income earned on
    our real estate loans;
|
| |  | Preserve capital contributions; and                                                        
|
| |  | Reinvest, to the extent permissible, payments of principal and
    sales (net of expenses).

Acquisition and Investment Policies












| |   |                                                                                                                               
| | - | ------------------------------------------------------------------------------------------------------------------------------
| |  | the ratio of the amount of the investment to the value of the
    property by which it is secured, or the loan-to-value ratio;
|
| |  | the potential for capital appreciation or depreciation of the
    property securing the investment;                           
|
| |  | expected levels of rental and occupancy rates, if applicable;                                                                 
|
| |  | potential for rental increases, if applicable;                                                                                
|
| |  | current and projected revenues from the property, if applicable)                                                              
|
| |  | the status and condition of the record title of the property
    securing the investment;                                     

4



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| |   |                                                                                                   
| | - | --------------------------------------------------------------------------------------------------
| |  | geographic location of the property securing the
    investment; and                              
|
| |  | the financial condition of the borrowers and their principals,
    if any, who guarantee the loan.







| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 1. Priority of Loans. Generally, our assets are
    secured by first deeds of trust. First trust deeds are loans
    secured by a full or divided interest in a first deed of trust
    secured by the property. Other loans that we invest in on the
    security property will not be junior to more than one other
    loan. As of June 30, 2005, approximately 99% of the
    principal amount of our outstanding interest in loans was
    secured by first deeds of trust.
|
| | 2. Loan-to-Value Ratio. The amount of our loan
    combined with the outstanding debt secured by a senior loan on a
    security property generally does not exceed the following
    percentage of the appraised value of the security property at
    origination:                                                                                                                                                                                                            

|                            |  |                                             
|--------------------------- |  | --------------------------------------------
|Type of Secured Property    |  | Loan-to-Value Ratio                         
|                            |  |                                             
|Residential                 |  | 75%                                         
|Unimproved Land             |  | 60% (of anticipated as-if development value)
|Acquisition and Development |  | 75% (of anticipated as-if development value)
|Commercial Property         |  | 75% (of anticipated as-if development value)
|Construction                |  | 75% (of anticipated post-development value) 
|Bridge                      |  | 75% (of anticipated as-if development value)
|Leasehold Interest          |  | 75% (of value of leasehold interest)        



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The target loan-to-value ratio for our loan portfolio as a whole
    is approximately 70%. However, we may deviate from these
    guidelines under certain circumstances. For example, Vestin
    Mortgage, in its discretion, may increase any of the above
    loan-to-value ratios if a given loan is supported by credit
    adequate to justify a higher loan-to-value ratio, including
    personal guarantees. Occasionally, our collateral may include
    personal property attached to the real property as well as the
    real property. We do not have specific requirements with respect
    to the projected income or occupancy levels of a property
    securing our investment in a particular loan. These
    loan-to-value ratios will not apply to financing offered by us
    to the purchaser of any real estate acquired through
    foreclosure, or to refinance an existing loan that is in default
    when it matures. In those cases, Vestin Mortgage, in its sole
    discretion, shall be free to accept any reasonable financing
    terms it deems to be in our best interest.
|
| | Loan to value ratios are based on appraisals that the Manager
    receives at the time of loan underwriting and may not reflect
    subsequent changes in value estimates. Such appraisals, which
    may have been commissioned by the borrower and also may precede
    the placement of the loan with us, are generally dated no
    greater than 12 months prior to the date of loan
    origination. The appraisals may be for the current estimate of
    the as-if developed value of the property, which
    approximates the post-construction value of the collateralized
    property assuming that such property is developed. As-if
    developed values on raw land loans or acquisition and
    development loans often dramatically exceed the immediate sales
    value and may include anticipated zoning changes, and successful
    development by the purchaser; upon which development is
    dependent on availability of financing. As most of the
    appraisals will be prepared on an as-if developed
    basis, if a loan goes into default prior to any development of a    

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| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | project, the market value of the property may be substantially
    less than the appraised value. As a result, there may be less
    security than anticipated at the time the loan was originally
    made. If there is less security and a default occurs, we may not
    recover the full amount of the loan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| | We or the borrower retain appraisers who are licensed or
    qualified as independent appraisers and certified by or hold
    designations from one or more of the following organizations:
    the Federal National Mortgage Association, the Federal Home Loan
    Mortgage Corporation, the National Association of Review
    Appraisers, the Appraisal Institute, the Society of Real Estate
    Appraisers, M.A.I., Class IV Savings and Loan appraisers or
    from among appraisers with other qualifications acceptable to
    Vestin Mortgage. However, appraisals are only estimates of value
    and cannot be relied on as measures of realizable value. An
    employee or agent of Vestin Mortgage will review each appraisal
    report and will conduct a physical inspection for each property.
    A physical inspection includes an assessment of the subject
    property, the adjacent properties and the neighborhood, but
    generally does not include entering any structures on the
    property.                                                                                                                                                                                                  
|
| | 3. Construction Real estate loans. We invest in
    construction loans other than home improvement loans on
    residential property, when the loan-to-value ratio does not
    exceed 75% of the appraised, completed value of the security
    property at origination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | 4. Terms of Real estate loans. Our loans as of
    June 30, 2005 range from a six-month term to a thirty-six
    month term. Most of our loans are for a term of 12 months.
    Our original loan agreements, however, permit extensions to the
    term of the loan by mutual consent. Such extensions are
    generally provided on loans where the original term was
    12 months or less and where a borrower requires additional
    time to complete a construction project or negotiate take out
    financing.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| | Currently, all but one of our loans provide for payments of
    interest only with a balloon payment of principal
    payable in full at the end of the term. One of our loans is an
    amortizing loan with a balance of approximately
    $7.8 million and a term of 36 months. In addition, we
    also invest in real estate loans that have interest reserves.
    Loans with interest reserves require the borrowers to maintain
    interest reserves funded from the principal amount of the loan
    for a period of time. At June 30, 2005, we had
    $13.5 million in investments in real estate loans that had
    interest reserves where the total outstanding principal was
    approximately $67.8 million, including participating
    lenders. These loans had interest reserves of approximately
    $5.6 million, of which our portion is $600,000. At
    September 30, 2004, we had $18.2 million in
    investments in real estate loans that had interest reserves
    where the total outstanding principal was approximately
    $150.7 million, including participating lenders. These
    loans had interest reserves of approximately $7.0 million,
    of which our portion was $1.3 million.
|
| | 5. Escrow Conditions. Our loans will often be funded
    by us through an escrow account held by a title insurance
    company, subject to the following conditions:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           



| |   |                                                                                                                                                                                                                                                                                                                                                                         
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Borrowers will obtain title insurance coverage for all loans,
    providing title insurance in an amount at least equal to the
    principal amount of the loan. Title insurance insures only the
    validity and priority of our deed of trust, and does not insure
    us against loss by other causes, such as diminution in the value
    of the security property.
|
| |  | Borrowers will obtain fire and casualty insurance for all loans
    secured by improved real property, covering us in an amount
    sufficient to cover the replacement cost of improvements.                                                                                                                                                                           
|
| |  | All insurance policies, notes, deeds of trust or loans, escrow
    agreements, and any other loan documents for a particular
    transaction will cover us as a beneficiary.                                                                                                                                                                                            



| |                                                                                                                                                                                                                                                                                                                         
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 6. Purchase of Loan Investments from Affiliates. We
    may acquire real estate loans from our affiliates, including
    Vestin Mortgage, for a price not in excess of the par value of
    the note, plus allowable fees and expenses, but without the
    allowance of any other compensation for the loans.          
|
| | 7. Note Hypothecation. We may also acquire real
    estate loans secured by assignments of secured promissory notes.
    These real estate loans must satisfy our stated investment
    standards, including our loan-to-value ratios, and also may not
    exceed 80% of the principal amount of the assigned note upon

6



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| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | acquisition. For example, if the property securing a note we
    acquire is commercial property, the total amount of outstanding
    debts secured by the property must not exceed 75% of the
    appraised value of the property, and the real estate loan will
    not exceed 80% of the principal amount of the assigned note. For
    real estate loans secured by promissory notes, we will rely on
    the appraised value of the underlying property, as determined by
    an independent written appraisal which was conducted within the
    then-preceding twelve months. If an appraisal was not conducted
    within that period, then we will arrange for a new appraisal to
    be prepared for the property prior to acquisition of the loan.
|
| | 8. Participation. We participate in loans with other
    lenders, including affiliates as permitted by the NASAA
    Guidelines, by providing funds for or purchasing an undivided
    interest in a loan meeting our investment guidelines described
    above. Typically, we participate in loans if:                                                                                                                                                                                                                                                                                                                                                                                                                                                     



| |   |                                                                                                                                                                                                                                                  
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We did not have sufficient funds to invest in an entire loan;                                                                                                                                                                                    
|
| |  | We are seeking to increase the diversification of our loan
    portfolio; or                                                                                                                                                                     
|
| |  | Vestin Mortgage originated a loan that fit within our investment
    guidelines but it would constitute more than 20% of our
    anticipated capital contribution or otherwise be
    disproportionately large given our then existing portfolio.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Loans in which third party investors have participated through
    inter-creditor agreements (Inter-creditor
    Agreements) are accounted for as secured borrowings in
    accordance with SFAS No. 140, Accounting for
    Transfers and Servicing of Financial Assets and Extinguishments
    of Liabilities(SFAS No. 140). The
    Inter-creditor Agreements provide us additional funding sources
    for real estate loans whereby a third party investor (the
    Investor) may participate on a non-pari passu basis
    in certain real estate loans with us and/or Fund II and/or
    Fund III (collectively, the Lead Lenders). In
    the event of borrower non-performance, the Inter-creditor
    Agreements generally provide that the Lead Lenders must repay
    the Investors loan amount either by (i) continuing to
    remit to the Investor the interest due on the participated loan
    amount; (ii) substituting an alternative loan acceptable to
    the Investor; or (iii) repurchasing the participation from
    the Investor for the outstanding balance plus accrued interest.
|
| | An Investor may participate in certain loans with the Lead
    Lenders through participation agreements. In the event of
    borrower non-performance, the participation agreement may allow
    the Investor to be repaid up to the amount of the
    Investors investment prior to the lead lenders being
    repaid.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| | As of June 30, 2005, 97% of our loans were loans in which
    we participated with other lenders, most of whom are our
    affiliates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| | 9. Diversification. The NASAA Guidelines provide
    that we neither invest in, or make real estate loans on any one
    property which would exceed, in the aggregate, an amount equal
    to 20% of our capital nor may we invest in or make real estate
    loans to or from any one borrower which would exceed, in the
    aggregate, an amount greater than 20% of our capital. As of
    June 30, 2005, our single largest loan accounted for 10.6%
    of our members equity. The loan bears interest at
    5% per annum and, as of June 30, 2005, the outstanding
    balance of the loan was approximately $7.8 million. The
    loans maturity date is September 2007.                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | 10. Reserve Fund. We have established contingency
    working capital reserves of approximately 3% of our capital to
    cover our unexpected cash needs.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| | 11. Credit Evaluations. When reviewing a loan
    proposal, Vestin Mortgage determines whether a borrower has
    sufficient equity in the security property. Vestin Mortgage may
    also consider the income level and creditworthiness of a
    borrower to determine its ability to repay the real estate loan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | 12. Sale of Loan Investments. Although Vestin
    Mortgage has no plans to do so, Vestin Mortgage may sell our
    real estate loans or interest in our loans to either affiliates
    or non-affiliated parties when Vestin Mortgage believes that it
    is advantageous to us to do so. However, we do not expect that
    the loans will be marketable or that a secondary market will
    ever develop for them.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

7



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Real estate loans to Affiliates




Purchase of Loans from Vestin Mortgage and its Affiliates




Types of Loans We Invest In






| |                              
| | -----------------------------
| | Raw and Unimproved Land Loans





| |                                  
| | ---------------------------------
| | Acquisition and Development Loans





| |                   
| | ------------------
| | Construction Loans



8



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| |                          
| | -------------------------
| | Commercial Property Loans





| |                  
| | -----------------
| | Residential Loans





| |             
| | ------------
| | Bridge Loans





Collateral






| |                    
| | -------------------
| | First Deed of Trust





| |                     
| | --------------------
| | Second Deed of Trust



9



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| |                   
| | ------------------
| | Leasehold Interest



Prepayment Penalties and Exit Fees




Extensions to Term of Loan




Interest Reserves




Balloon Payment




Repayment of Loans on Sale of Properties




10



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Variable Rate Loans










Borrowing






| |   |                                                                                                                    
| | - | -------------------------------------------------------------------------------------------------------------------
| |  | finance our investments in real estate loans,                                                                      
|
| |  | prevent a default under real estate loans that are senior to our
    real estate loans,                            
|
| |  | discharge senior real estate loans if this becomes necessary to
    protect our investment in real estate loans, or
|
| |  | operate or develop a property that we acquired under a defaulted
    loan.                                         





Competition




11



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Regulation










Employees




Available Information




12



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|        |           
|------- | ----------
|ITEM 2. | PROPERTIES










|        |                  
|------- | -----------------
|ITEM 3. | LEGAL PROCEEDINGS

Legal Matters Involving Our Manager








Legal Matters involving the Company






13



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|        |                                                    
|------- | ---------------------------------------------------
|ITEM 4. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS






PART II







|        |                                                                          
|------- | -------------------------------------------------------------------------
|ITEM 5. | MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED
    STOCKHOLDER MATTERS

Market Information




Holders




Dividend Policy




Recent Sales of Unregistered Securities




Equity Compensation Plan Information




Purchases of Equity Securities by the Issuer and Affiliated
Purchasers


|           |  |                    |       |  |                    |                    |       |                 |                    |  |                    |  |  |  |      | 
|---------- |  | ------------------ | ----- |  | ------------------ | ------------------ | ----- | --------------- | ------------------ |  | ------------------ |  |  |  | ---- | 
|           |  |                    |       |  |                    |                    |       | Maximum Number  |                   
|           |  |                    |       |  |                    |                    |       | (or Approximate |                   
|           |  |                    |       |  |                    | Total Number of    |       |                 | Dollar Value) of   | 
|           |  |                    |       |  |                    | Units Purchased as |       |                 | Units that May Yet | 
|           |  |                    |       |  |                    | Part of Publicly   |       |                 | be Purchased       | 
|           |  | Total Number of    |       |  | Average Price Paid |                    |       | Announced Plans |                    |  | Under the Plans or | 
|Period     |  | Units Purchased(1) |       |  | per Unit           |                    |       | or Programs     |                    |  | Programs           | 
|           |  |                    |       |  |                    |                    |       |                 |                    |  |                    | 
|April 2005 |  |                    | 5,882 |  |                    | $                  | 10.00 |                 |                    |  | None               |  |  |  | None | 
|May 2005   |  |                    | 4,537 |  |                    | $                  | 10.00 |                 |                    |  | None               |  |  |  | None | 
|June 2005  |  |                    | 4,132 |  |                    | $                  | 10.00 |                 |                    |  | None               |  |  |  | None | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Pursuant to our Operating Agreement, members may request to have
    their units redeemed. However, in order to comply with our
    Operating Agreement and Internal Revenue Code, we may redeem no
    more than 10% of the aggregate members capital in any
    calendar year. Balances in Members capital accounts as of
    January 1, 2005 was approximately $81.7 million, which
    limited redemptions to approximately $8.2 million for
    calendar 2005. As of June 30, 2005, we had approximately
    $2.0 million in redemptions that remain to be fulfilled in
    2005.

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|        |                        
|------- | -----------------------
|ITEM 6. | SELECTED FINANCIAL DATA

Vestin Fund I, LLC


|                                                                                |  |          |            |  |               |   |            |               |  |   |               |  |  |              |             |  |  |   |             | 
|------------------------------------------------------------------------------- |  | -------- | ---------- |  | ------------- | - | ---------- | ------------- |  | - | ------------- |  |  | ------------ | ----------- |  |  | - | ----------- | 
|                                                                                |  | June 30, |            |  | September 30, |   |            | September 30, |  |   | September 30, |  |  | December 31, |            
|                                                                                |  | 2005     |            |  | 2004          |   |            | 2003          |  |   | 2002          |  |  | 2001         |            
|                                                                                |  |          |            |  |               |   |            |               |  |   |               |  |  |              |            
|Balance Sheet Data:                                                             |  |          |            |  |               |   |            |               |  |   |               |  |  |              |             |  |  |   |             | 
|Investments in real estate loans (net of allowance)                             |  | $        | 54,878,000 |  |               | $ | 47,344,000 |               |  | $ | 51,695,000    |  |  | $            | 91,091,000  |  |  | $ | 97,228,000  | 
|Cash, cash equivalents, certificates of deposits and short-term
    investments |  | $        | 3,162,000  |  |               | $ | 10,130,000 |               |  | $ | 14,883,000    |  |  | $            | 5,538,000   |  |  | $ | 4,257,000   | 
|Interest and other receivables                                                  |  | $        | 682,000    |  |               | $ | 1,327,000  |               |  | $ | 1,632,000     |  |  | $            | 1,176,000   |  |  | $ | 1,009,000   | 
|Real estate held for sale                                                       |  | $        | 7,757,000  |  |               | $ | 15,287,000 |               |  | $ | 22,517,000    |  |  | $            | 1,541,000   |  |  | $ |            | 
|Real estate held for sale  seller financed                                     |  | $        | 10,374,000 |  |               | $ | 10,801,000 |               |  | $ | 4,006,000     |  |  | $            |            |  |  | $ |            | 
|Note receivable                                                                 |  |          | 119,000    |  |               |   | 119,000    |               |  |   |              |  |  |              |            |  |  |   |            | 
|Assets under secured borrowing                                                  |  | $        | 11,391,000 |  |               | $ | 6,134,000  |               |  | $ | 20,324,000    |  |  | $            | 6,637,000   |  |  | $ |            | 
|Other assets                                                                    |  | $        |           |  |               | $ |           |               |  | $ | 7,000         |  |  | $            | 84,000      |  |  | $ | 28,000      | 
|Total assets                                                                    |  | $        | 88,363,000 |  |               | $ | 91,142,000 |               |  | $ | 115,064,000   |  |  | $            | 106,067,000 |  |  | $ | 102,522,000 | 
|Liabilities                                                                     |  | $        | 15,092,000 |  |               | $ | 8,864,000  |               |  | $ | 28,549,000    |  |  | $            | 7,068,000   |  |  | $ | 66,000      | 
|Members equity                                                                 |  | $        | 73,271,000 |  |               | $ | 82,278,000 |               |  | $ | 86,515,000    |  |  | $            | 98,999,000  |  |  | $ | 102,456,000 | 
|Total liabilities and Members equity                                           |  | $        | 88,363,000 |  |               | $ | 91,142,000 |               |  | $ | 115,064,000   |  |  | $            | 106,067,000 |  |  | $ | 102,522,000 | 

|                                                                                 |  |              |           |  |               |   |            |               |  |   |               |  |  |              |            |  |  |   |            | 
|-------------------------------------------------------------------------------- |  | ------------ | --------- |  | ------------- | - | ---------- | ------------- |  | - | ------------- |  |  | ------------ | ---------- |  |  | - | ---------- | 
|                                                                                 |  | Nine Month   |           |  |               |   |            |               |  |   |              
|                                                                                 |  | Transition   |           |  | 12 Months     |   |            | 12 Months     |  |   | 12 Months     |  |  | 12 Months    |           
|                                                                                 |  | Period Ended |           |  | Ended         |   |            | Ended         |  |   | Ended         |  |  | Ended        |           
|                                                                                 |  | June 30,     |           |  | September 30, |   |            | September 30, |  |   | September 30, |  |  | December 31, |           
|                                                                                 |  | 2005         |           |  | 2004          |   |            | 2003          |  |   | 2002          |  |  | 2001         |           
|                                                                                 |  |              |           |  |               |   |            |               |  |   |               |  |  |              |           
|                                                                                 |  | (Unaudited)  |          
|Income Statement Data:                                                           |  |              |           |  |               |   |            |               |  |   |               |  |  |              |            |  |  |   |            | 
|Revenues                                                                         |  | $            | 6,069,000 |  |               | $ | 12,666,000 |               |  | $ | 10,365,000    |  |  | $            | 13,151,000 |  |  | $ | 11,565,000 | 
|Expenses                                                                         |  | $            | 4,941,000 |  |               | $ | 4,099,000  |               |  | $ | 6,054,000     |  |  | $            | 566,000    |  |  | $ | 177,000    | 
|Net income (loss)                                                                |  | $            | 1,128,000 |  |               | $ | 8,567,000  |               |  | $ | 4,311,000     |  |  | $            | 12,585,000 |  |  | $ | 11,388,000 | 
|Net income (loss) allocated to Members                                           |  | $            | 1,128,000 |  |               | $ | 8,567,000  |               |  | $ | 4,311,000     |  |  | $            | 12,585,000 |  |  | $ | 11,388,000 | 
|Net income (loss) allocated to Members per weighted average
    membership units |  | $            | 0.14      |  |               | $ | 1.03       |               |  | $ | 0.45          |  |  | $            | 1.23       |  |  | $ | 1.34       | 
|Cash distributions                                                               |  | $            | 3,694,000 |  |               | $ | 5,098,000  |               |  | $ | 10,364,000    |  |  | $            | 9,637,000  |  |  | $ | 10,757,000 | 
|Cash distributions per weighted average membership units                         |  | $            | 0.47      |  |               | $ | 0.61       |               |  | $ | 1.07          |  |  | $            | 0.95       |  |  | $ | 1.26       | 
|Weighted average membership units                                                |  |              | 7,919,354 |  |               |   | 8,339,404  |               |  |   | 9,668,310     |  |  |              | 10,193,776 |  |  |   | 8,519,804  | 








|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|ITEM 7. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
    CONDITION AND RESULTS OF OPERATIONS



15



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RESULTS OF OPERATIONS


OVERVIEW










16



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| |                                                                                                      
| | -----------------------------------------------------------------------------------------------------
| | Transition period ended June 30, 2005 compared to the
    nine months ended June 30, 2004 (Unaudited)

|                                                                          |  |                    |           |             |               |   |            |  
|------------------------------------------------------------------------- |  | ------------------ | --------- | ----------- | ------------- | - | ---------- | -
|                                                                          |  | For the Transition |           |             | For the Nine  |  
|                                                                          |  | Period Ended       |           |             | Months Ended  |  
|                                                                          |  | June 30, 2005      |           |             | June 30, 2004 |  
|                                                                          |  |                    |           |             |               |  
|                                                                          |  |                    |           | (Unaudited) |              
|Total revenues                                                            |  | $                  | 6,069,000 |             |               | $ | 10,845,000 |  
|Total expenses                                                            |  |                    | 4,941,000 |             |               |   | 2,933,000  |  
|                                                                          |  |                    |           |             |               |  
|Net income                                                                |  | $                  | 1,128,000 |             |               | $ | 7,912,000  |  
|                                                                          |  |                    |           |             |               |  
|Net income allocated to members per weighted average membership
    units |  | $                  | 1,128,000 |             |               | $ | 7,912,000  |  
|                                                                          |  |                    |           |             |               |  
|Annualized rate of return to members(b)                                   |  |                    | 1.9       | %           |               |   | 12.6       | %
|                                                                          |  |                    |           |             |               |  
|Weighted average membership units                                         |  |                    | 7,919,354 |             |               |   | 8,398,813  |  
|                                                                          |  |                    |           |             |               |  
|Cash distributions                                                        |  | $                  | 3,694,000 |             |               | $ | 3,705,000  |  
|                                                                          |  |                    |           |             |               |  
|Cash distributions per weighted average membership unit                   |  | $                  | 0.47      |             |               | $ | 0.44       |  
|                                                                          |  |                    |           |             |               |  
|Weighted average term of outstanding loans                                |  |                    | 19 months |             |               |   | 16 months  |  
|                                                                          |  |                    |           |             |               |  






|    |                                                                                                                                                                                                                                                                                                                                                                                  
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | The annualized rate of return to members is calculated based
    upon the GAAP net income allocated to members per weighted
    average units as of June 30, 2005 and 2004 divided by
    273 days and 274 days, respectively (the number of
    days during each respective period) and multiplied by
    365 days, then divided by ten (the original cost of
    $10 per unit).

Total Revenues.


17



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Total Expenses.




| |   |                                                                                                                                                                                                                                                                                                                                                                         
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We have commenced a judicial foreclosure on a loan secured by 4
    cemeteries and 8 mortuaries in Hawaii. Upon completion of a
    valuation analysis it was deemed necessary to provide a
    valuation allowance for the entire carrying value of the loan by
    approximately $1,225,000 during the quarter ended June 30,
    2005 See Rightstar Loan Allowance.
|
| |  | We wrote down the carrying value of 166 residential lots located
    in Henderson, Nevada by $354,000 during the transition period
    ended June 30, 2005.                                                                                                                                                                                                             

18



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| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We wrote down the carrying value of a custom residential
    property located in Santa Fe, New Mexico by approximately
    $278,000 during the quarter ended December 31, 2004.                                                                                                                                                                                                                                                                                        
|
| |  | We sold a 126 unit hotel in Mesquite, Nevada and sustained
    a loss of approximately $389,000 during the quarter ended
    March 31, 2005.                                                                                                                                                                                                                                                                                                                           
|
| |  | For the nine months ended June 30, 2005 and 2004, we
    recognized professional fees of approximately $494,000 and
    $144,000, respectively, which was an increase of approximately
    $350,000. We expect these fees to continue at the amounts being
    incurred during the nine months ended June 30, 2005 due to
    continued costs related to foreclosures and the implementation
    and maintenance of requirements of the Sarbanes-Oxley Act of
    2002.
|
| |  | Expenses related to the maintenance of real estate held for sale
    increased by approximately $340,000. This increase includes
    expenses of approximately $160,000 in property taxes.                                                                                                                                                                                                                                                                             



Net Income.


Annualized Rate of Return to Members.


Distributions to Members.


|                                                                 |  |                    |           |  |               |   |           | 
|---------------------------------------------------------------- |  | ------------------ | --------- |  | ------------- | - | --------- | 
|                                                                 |  | For the Transition |           |  | For the Nine  |  
|                                                                 |  | Period Ended       |           |  | Months Ended  |  
|                                                                 |  | June 30, 2005      |           |  | June 30, 2004 |  
|                                                                 |  |                    |           |  |               |  
|Distributions Representing Net Income Available for Distribution |  | $                  | 3,694,000 |  |               | $ | 3,705,000 | 
|Distributions Representing return of capital                     |  |                    |          |  |               |   |          | 
|                                                                 |  |                    |           |  |               |  
|Total Distributions                                              |  | $                  | 3,694,000 |  |               | $ | 3,705,000 | 
|                                                                 |  |                    |           |  |               |  

Stated Unit Value Adjustment.


Redemptions.


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| |                                                                        
| | -----------------------------------------------------------------------
| | Fiscal Year Ended September 30, 2004 Compared To
    September 30, 2003

|                                                                                 |  |               |            |   |               |   |            |  
|-------------------------------------------------------------------------------- |  | ------------- | ---------- | - | ------------- | - | ---------- | -
|                                                                                 |  | For the Year  |            |   | For the Year  |  
|                                                                                 |  | Ended         |            |   | Ended         |  
|                                                                                 |  | September 30, |            |   | September 30, |  
|                                                                                 |  | 2004          |            |   | 2003          |  
|                                                                                 |  |               |            |   |               |  
|Total revenues                                                                   |  | $             | 12,666,000 |   |               | $ | 10,365,000 |  
|Total expenses                                                                   |  |               | 4,099,000  |   |               |   | 6,054,000  |  
|                                                                                 |  |               |            |   |               |  
|Net income (loss)                                                                |  | $             | 8,567,000  |   |               | $ | 4,311,000  |  
|                                                                                 |  |               |            |   |               |  
|Net income (loss) allocated to members per weighted average
    membership units |  | $             | 8,567,000  |   |               | $ | 4,311,000  |  
|                                                                                 |  |               |            |   |               |  
|Annualized rate of return to members(a)                                          |  |               | 10.27      | % |               |   | 4.45       | %
|                                                                                 |  |               |            |   |               |  
|Weighted average membership units                                                |  |               | 8,339,404  |   |               |   | 9,668,310  |  
|                                                                                 |  |               |            |   |               |  
|Cash distributions                                                               |  | $             | 5,098,000  |   |               | $ | 10,364,000 |  
|                                                                                 |  |               |            |   |               |  
|Cash distributions per weighted average membership unit                          |  | $             | 0.61       |   |               | $ | 1.07       |  
|                                                                                 |  |               |            |   |               |  
|Weighted average term of outstanding loans                                       |  |               | 19 months  |   |               |   | 13 months  |  
|                                                                                 |  |               |            |   |               |  






|    |                                                                                                                                                                                                                                                                                                
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | The annualized rate of return to members is calculated based
    upon the net income allocated to members per weighted average
    units divided by the number of days during the period and
    multiplied by 365 days in a year, then divided by ten (the
    original cost of $10 per unit).

Total Revenues.




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Total Expenses.




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Provisions for loan losses decreased by $0.3 million to
    $0.1 million for the year ended September 30, 2004
    compared to $0.4 million for the same period in the prior
    year due to our Managers determination that our general
    allowance for loan losses is sufficient to cover any inherent
    losses related to our loan portfolio. Therefore, the general
    provision for loan losses was limited to $0.1 million for
    the year ended September 30, 2004.

21



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| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We incurred valuation losses on real estate held for sale of
    approximately $1.1 million for the year ended
    September 30, 2004 as compared to $3.4 million in the
    prior year, a decrease of approximately $2.3 million. The
    decrease is based on factors specific to each property but
    generally related to our Managers evaluation of the real
    estate held for sale portfolio and the respective estimated
    values. Refer to Investment in real estate held for
    sale.



Net Income.


Annualized Rate of Return to Members.


Distributions to Members.


|                                                       |  |               |           |  |               |   |            | 
|------------------------------------------------------ |  | ------------- | --------- |  | ------------- | - | ---------- | 
|                                                       |  | For the Year  |           |  | For the Year  |  
|                                                       |  | Ended         |           |  | Ended         |  
|                                                       |  | September 30, |           |  | September 30, |  
|                                                       |  | 2004          |           |  | 2003          |  
|                                                       |  |               |           |  |               |  
|Distributions of Net Income Available for Distribution |  | $             | 5,098,000 |  |               | $ | 8,299,000  | 
|Distributions of return of capital                     |  |               |          |  |               |   | 2,065,000  | 
|                                                       |  |               |           |  |               |  
|Total Distributions                                    |  | $             | 5,098,000 |  |               | $ | 10,364,000 | 
|                                                       |  |               |           |  |               |  

Redemptions.




| |                                                                      
| | ---------------------------------------------------------------------
| | Investments in Real estate loans Secured by Real Estate
    Portfolio





|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |        |   |  |  |       |  
|--------------------------- |  | ------ | -- |  | ---------- | - | ---------- | ------------- |  | --------- | ---------- | - | ------- | -------- | ------ | - |  |  | ----- | -
|                            |  | Number |    |  |            |   | Weighted   |               |  |           |            |  
|                            |  | of     |    |  |            |   | Average    |               |  | Portfolio |            |   | Loan to |         
|Loan Type                   |  | Loans  |    |  | Balance(1) |   |            | Interest Rate |  |           | Percentage |   |         | Value(2) |       
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       
|Acquisition and development |  |        | 4  |  |            | $ | 7,272,000  |               |  |           | 8.49       | % |         |          | 10.82  | % |  |  | 71.05 | %
|Bridge(3)                   |  |        | 5  |  |            |   | 7,063,000  |               |  |           | 10.16      | % |         |          | 10.52  | % |  |  | 50.78 | %
|Commercial                  |  |        | 10 |  |            |   | 31,376,000 |               |  |           | 9.99       | % |         |          | 46.73  | % |  |  | 67.17 | %
|Construction                |  |        | 3  |  |            |   | 3,712,000  |               |  |           | 9.40       | % |         |          | 5.53   | % |  |  | 69.94 | %
|Land                        |  |        | 7  |  |            |   | 17,725,000 |               |  |           | 12.89      | % |         |          | 26.40  | % |  |  | 61.67 | %
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       
|                            |  |        | 29 |  |            | $ | 67,148,000 |               |  |           | 10.58      | % |         |          | 100.00 | % |  |  | 64.56 | %
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       

22



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|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |        |   |  |  |       |  
|--------------------------- |  | ------ | -- |  | ---------- | - | ---------- | ------------- |  | --------- | ---------- | - | ------- | -------- | ------ | - |  |  | ----- | -
|                            |  | Number |    |  |            |   | Weighted   |               |  |           |            |  
|                            |  | of     |    |  |            |   | Average    |               |  | Portfolio |            |   | Loan to |         
|Loan Type                   |  | Loans  |    |  | Balance(1) |   |            | Interest Rate |  |           | Percentage |   |         | Value(2) |       
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       
|Acquisition and development |  |        | 10 |  |            | $ | 18,810,000 |               |  |           | 9.71       | % |         |          | 32.02  | % |  |  | 63.01 | %
|Bridge(3)                   |  |        | 9  |  |            |   | 8,687,000  |               |  |           | 10.65      | % |         |          | 14.79  | % |  |  | 49.98 | %
|Commercial                  |  |        | 8  |  |            |   | 12,932,000 |               |  |           | 12.22      | % |         |          | 22.01  | % |  |  | 77.19 | %
|Construction                |  |        | 4  |  |            |   | 12,182,000 |               |  |           | 7.64       | % |         |          | 20.74  | % |  |  | 76.81 | %
|Land                        |  |        | 4  |  |            |   | 6,134,000  |               |  |           | 12.65      | % |         |          | 10.44  | % |  |  | 71.42 | %
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       
|                            |  |        | 35 |  |            | $ | 58,745,000 |               |  |           | 10.28      | % |         |          | 100.00 | % |  |  | 67.94 | %
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The following table reconciles the balance of the loan portfolio
    to the amount shown on the accompanying Balance Sheet. The
    contra accounts represent the amount of real estate held for
    sale sold to third parties where we provided financing. GAAP
    requires the borrower to have a certain percentage equity
    ownership (typically 20%) to allow us to record the sale of a
    property. In addition, the borrower must maintain a minimum
    commitment in the property on a continuing basis. Therefore,
    until the borrower meets these requirements, the investment in
    the new loan is reduced by the amount originally invested in the
    real estate held for sale.

|                                                            |  |               |             |   |                    |   |             |  
|----------------------------------------------------------- |  | ------------- | ----------- | - | ------------------ | - | ----------- | -
|                                                            |  | June 30, 2005 |             |   | September 30, 2004 |  
|                                                            |  | Balance       |             |   | Balance            |  
|                                                            |  |               |             |   |                    |  
|Balance per loan portfolio                                  |  | $             | 67,148,000  |   |                    | $ | 58,745,000  |  
|Less:                                                       |  |               |             |   |                    |   |             |  
|Seller financed loans included in real estate held for sale |  |               | (10,374,000 | ) |                    |   | (10,801,000 | )
|Allowance for loan losses                                   |  |               | (1,896,000  | ) |                    |   | (600,000    | )
|                                                            |  |               |             |   |                    |  
|Balance per accompanying Balance Sheet                      |  | $             | 54,878,000  |   |                    | $ | 47,344,000  |  
|                                                            |  |               |             |   |                    |  



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Loan to value ratios are based on appraisals obtained at the
    time of loan origination and may not reflect subsequent changes
    in value estimates. Such appraisals, which may be commissioned
    by the borrower and also may precede the placement of the loans
    with us, are generally dated no greater than 12 months
    prior to the date of loan origination. The appraisals may be for
    the current estimate of the as-if developed value of
    the property, which approximates the post-construction value of
    the collateralized property assuming that such property is
    developed. As-if developed values on raw land loans
    or acquisition and development loans often dramatically exceed
    the immediate sales value and may include anticipated zoning
    changes, and successful development by the purchaser; upon which
    development is dependent on availability of financing. As most
    of the appraisals will be prepared on an as-if
    developed basis, if a loan goes into default prior to any
    development of a project, the market value of the property may
    be substantially less than the appraised value. As a result,
    there may be less security than anticipated at the time the loan
    was originally made. If there is less security and a default
    occurs, we may not recover the full amount of the loan.
|   
|(3) | Bridge loans are a subcategory of commercial loans in which we
    provide interim financing for borrowers seeking long-term,
    permanent financing. Going forward, we expect to report bridge
    loans within the commercial category.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

|                     |  |               |            |  |            |  |        |                    |  |   |            |  |  |  |        |  
|-------------------- |  | ------------- | ---------- |  | ---------- |  | ------ | ------------------ |  | - | ---------- |  |  |  | ------ | -
|                     |  | June 30, 2005 |            |  | Portfolio  |  |        | September 30, 2004 |  |   | Portfolio  | 
|Loan Type            |  | Balance*      |            |  | Percentage |  |        | Balance*           |  |   | Percentage | 
|                     |  |               |            |  |            |  |        |                    |  |   |            | 
|First trust deeds    |  | $             | 66,645,000 |  |            |  | 99.25  | %                  |  | $ | 57,830,000 |  |  |  | 98.44  | %
|Second trust deeds** |  |               | 503,000    |  |            |  | 0.75   | %                  |  |   | 915,000    |  |  |  | 1.56   | %
|                     |  |               |            |  |            |  |        |                    |  |   |            | 
|                     |  | $             | 67,148,000 |  |            |  | 100.00 | %                  |  | $ | 58,745,000 |  |  |  | 100.00 | %
|                     |  |               |            |  |            |  |        |                    |  |   |            | 






| |   |                   
| | - | ------------------
| | * | See note (1) above



|   |                                                                                                                  
|-- | -----------------------------------------------------------------------------------------------------------------
|** | Generally, our Second trust deeds are junior to a first trust
    deed position held by either us or our Manager.

23



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|     |  |   |            | 
|---- |  | - | ---------- | 
|2005 |  | $ | 27,377,000 | 
|2006 |  |   | 31,201,000 | 
|2007 |  |   | 8,570,000  | 
|     |  |   |           
|     |  | $ | 67,148,000 | 
|     |  |   |           



|               |  |               |            |  |            |  |        |                    |  |   |            |  |  |  |        |  
|-------------- |  | ------------- | ---------- |  | ---------- |  | ------ | ------------------ |  | - | ---------- |  |  |  | ------ | -
|               |  | June 30, 2005 |            |  | Portfolio  |  |        | September 30, 2004 |  |   | Portfolio  | 
|               |  | Balance*      |            |  | Percentage |  |        | Balance*           |  |   | Percentage | 
|               |  |               |            |  |            |  |        |                    |  |   |            | 
|Arizona        |  | $             | 13,063,000 |  |            |  | 19.45  | %                  |  | $ | 11,682,000 |  |  |  | 19.89  | %
|California     |  |               | 19,794,000 |  |            |  | 29.48  | %                  |  |   | 11,475,000 |  |  |  | 19.53  | %
|Hawaii         |  |               | 4,139,000  |  |            |  | 6.16   | %                  |  |   | 4,139,000  |  |  |  | 7.05   | %
|Nevada         |  |               | 24,428,000 |  |            |  | 36.38  | %                  |  |   | 23,236,000 |  |  |  | 39.56  | %
|New York       |  |               | 3,320,000  |  |            |  | 4.94   | %                  |  |   | 3,320,000  |  |  |  | 5.65   | %
|North Carolina |  |               |           |  |            |  |       |                    |  |   | 90,000     |  |  |  | 0.15   | %
|Oklahoma       |  |               | 1,237,000  |  |            |  | 1.84   | %                  |  |   | 996,000    |  |  |  | 1.70   | %
|Texas          |  |               | 1,167,000  |  |            |  | 1.75   | %                  |  |   | 1,728,000  |  |  |  | 2.94   | %
|Utah           |  |               |           |  |            |  |       |                    |  |   | 1,503,000  |  |  |  | 2.56   | %
|Washington     |  |               |           |  |            |  |       |                    |  |   | 576,000    |  |  |  | 0.97   | %
|               |  |               |            |  |            |  |        |                    |  |   |            | 
|               |  | $             | 67,148,000 |  |            |  | 100.00 | %                  |  | $ | 58,745,000 |  |  |  | 100.00 | %
|               |  |               |            |  |            |  |        |                    |  |   |            | 






|  |                   
|- | ------------------
|* | See note (1) above



|                                                                                                   |  |               |           |  |               |           |            |                |               |            |         |  |  |  |       |  
|-------------------------------------------------------------------------------------------------- |  | ------------- | --------- |  | ------------- | --------- | ---------- | -------------- | ------------- | ---------- | ------- |  |  |  | ----- | -
|                                                                                                   |  |               |           |  |               | Number of |            |                | Percentage of |           
|                                                                                                   |  | Balance       |           |  |               |           | Months     |                |               | Total Loan |        
|Description of Collateral                                                                          |  | June 30, 2005 |           |  | Maturity Date |           |            | Non-Performing |               |            | Balance | 
|                                                                                                   |  |               |           |  |               |           |            |                |               |            |         | 
|4 cemeteries and 8 mortuaries in Hawaii                                                            |  | $             | 4,139,000 |  |               |           | 03/31/2004 |                |               |            | 15      |  |  |  | 12.17 | %
|Racetrack and hotel in Vernon, NY                                                                  |  |               | 3,320,000 |  |               |           | 06/30/2005 |                |               |            | 10      |  |  |  | 12.77 | %
|25 acres tentatively mapped for 104 single family
    residential lots in Palm Springs, California |  |               | 66,000    |  |               |           | 01/23/2006 |                |               |            | 8       |  |  |  | 5.11  | %
|4 separate commercial parcels in Rancho Cucamonga, Palm Springs,
    and Cathedral City, CA        |  |               | 51,000    |  |               |           | 04/16/2005 |                |               |            | 3       |  |  |  | 0.72  | %
|Development of 400 single and multi- family residential lots in
    Cathedral City, California     |  |               | 503,000   |  |               |           | 04/20/2005 |                |               |            | 8       |  |  |  | 7.74  | %
|                                                                                                   |  |               |           |  |               |           |            |                |               |            |         | 
|                                                                                                   |  | $             | 8,079,000 |  |               |           |            |                |               |            |         |  |  |  |       |  
|                                                                                                   |  |               |           |  |               |           |            |                |               |            |         | 



24



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|                            |  |               |         |  |            |   |           |            |          |      |   |  |  |   |           | 
|--------------------------- |  | ------------- | ------- |  | ---------- | - | --------- | ---------- | -------- | ---- | - |  |  | - | --------- | 
|                            |  | Balance       |         |  |            |   |           |            | Balance  |     
|                            |  | September 30, |         |  |            |   |           |            | June 30, |     
|Description                 |  | 2004          |         |  | Provisions |   |           | Deductions |          | 2005 |  
|                            |  |               |         |  |            |   |           |            |          |      |  
|General Valuation Allowance |  | $             | 600,000 |  |            | $ | 71,000    |            |          | $    |  |  |  | $ | 671,000   | 
|Specific allowance          |  |               |        |  |            |   | 1,225,000 |            |          |      |  |  |  |   | 1,225,000 | 
|                            |  |               |         |  |            |   |           |            |          |      |   | 
|Total                       |  | $             | 600,000 |  |            | $ | 1,296,000 |            |          | $    |  |  |  | $ | 1,896,000 | 
|                            |  |               |         |  |            |   |           |            |          |      |   | 

Rightstar Loan Allowance.




25



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##### Table of Contents





| |                                
| | -------------------------------
| | Asset Quality and Loan Reserves







| |   |                                                                                                             
| | - | ------------------------------------------------------------------------------------------------------------
| |  | prevailing economic conditions;                                                                             
|
| |  | historical experience;                                                                                      
|
| |  | the nature and volume of the loan portfolio;                                                                
|
| |  | the borrowers financial condition and adverse situations
    that may affect the borrowers ability to pay;
|
| |  | evaluation of industry trends; and                                                                          
|
| |  | estimated net realizable value of any underlying collateral in
    relation to the loan amount.             





| |                                         
| | ----------------------------------------
| | Investments in Real Estate Held for Sale



26



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##### Table of Contents





|                                                                        |  |          |            |  |               |         |    |               |  |   |              |      |      |           |            |         |             |   |             |          |  |          |           |   |  |   |            |   |  |   |           | 
|----------------------------------------------------------------------- |  | -------- | ---------- |  | ------------- | ------- | -- | ------------- |  | - | ------------ | ---- | ---- | --------- | ---------- | ------- | ----------- | - | ----------- | -------- |  | -------- | --------- | - |  | - | ---------- | - |  | - | --------- | 
|                                                                        |  |          |            |  |               |         |    |               |  |   |              | Gain |      |           | Write Down |         |             |  
|                                                                        |  |          |            |  |               | Balance |    |               |  |   | Proceed      |      |      | (Loss) on |            |         | on Real     |   |             | Balance  | 
|                                                                        |  | Date     |            |  | Percentage of |         |    | September 30, |  |   |              |      | from |           |            | Sale of |             |   | Estate Held |          |  | June 30, |          
|Description                                                             |  | Acquired |            |  | Ownership     |         |    | 2004          |  |   | Acquisitions |      |      | Sales     |            |         | Real Estate |   |             | for Sale |  |          | 2005      |  
|                                                                        |  |          |            |  |               |         |    |               |  |   |              |      |      |           |            |         |             |   |             |          |  |          |           |  
|Custom residential property located in Santa Fe, New
    Mexico(2)      |  |          | 3/4/2003   |  |               |         | 93 | %             |  | $ | 1,052,000    |      |      | $         |           |         |             | $ | (798,000    | )        |  | $        | 24,000    |   |  | $ | (278,000   | ) |  | $ |          | 
|Land containing 166 residential lots in Henderson, Nevada(2)            |  |          | 2/28/2003  |  |               |         | 66 | %             |  |   | 5,412,000    |      |      |           |           |         |             |   |            |          |  |          |          |   |  |   | (354,000   | ) |  |   | 5,058,000 | 
|30 unit condominium complex in Las Vegas, Nevada(2)                     |  |          | 2/4/2003   |  |               |         | 17 | %             |  |   | 216,000      |      |      |           |           |         |             |   | (216,000    | )        |  |          |          |   |  |   |           |   |  |   |          | 
|126 unit, (207 bed) assisted living facility in Phoenix,
    Arizona(2) |  |          | 9/8/2004   |  |               |         | 10 | %             |  |   | 1,526,000    |      |      |           |           |         |             |   |            |          |  |          |          |   |  |   | (640,000   | ) |  |   | 886,000   | 
|460 acre residential sub-division in Lake Travis, Texas                 |  |          | 8/3/2004   |  |               |         | 34 | %             |  |   | 1,784,000    |      |      |           | 29,000     |         |             |   |            |          |  |          |          |   |  |   |           |   |  |   | 1,813,000 | 
|140 unit/224 bed senior facility in Mesa, Arizona(2)                    |  |          | 5/26/2004  |  |               |         | 14 | %             |  |   | 1,020,000    |      |      |           |           |         |             |   | (1,009,000  | )        |  |          | (11,000   | ) |  |   |           |   |  |   |          | 
|28 acres of raw land in Mesquite, Nevada(2)                             |  |          | 11/27/2002 |  |               |         | 58 | %             |  |   | 2,159,000    |      |      |           |           |         |             |   | (3,208,000  | )        |  |          | 1,049,000 |   |  |   |           |   |  |   |          | 
|Hotel/ Casino in Las Vegas, Nevada                                      |  |          | 2/2/2004   |  |               |         | 27 | %             |  |   | 2,118,000    |      |      |           |           |         |             |   | (2,118,000  | )        |  |          |          |   |  |   |           |   |  |   |          | 
|126 unit Hotel in Mesquite, Nevada(1)(2)                                |  |          | 10/4/2004  |  |               |         | 32 | %             |  |   |             |      |      |           | 2,153,000  |         |             |   | (1,764,000  | )        |  |          | (389,000  | ) |  |   |           |   |  |   |          | 
|                                                                        |  |          |            |  |               |         |    |               |  |   |              |      |      |           |            |         |             |   |             |          |  |          |           |  
|Total                                                                   |  |          |            |  |               |         |    |               |  | $ | 15,287,000   |      |      | $         | 2,182,000  |         |             | $ | (9,113,000  | )        |  | $        | 673,000   |   |  | $ | (1,272,000 | ) |  | $ | 7,757,000 | 
|                                                                        |  |          |            |  |               |         |    |               |  |   |              |      |      |           |            |         |             |   |             |          |  |          |           |  






|    |                                               
|--- | ----------------------------------------------
|(1) | Foreclosures for the year ended June 30, 2005:





|    |                                                                         
|--- | ------------------------------------------------------------------------
|(2) | Sales of real estate held for sale for the year ended
    June 30, 2005:



27



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| |                                          
| | -----------------------------------------
| | Transactions subsequent to June 30, 2005:





| |                                                               
| | --------------------------------------------------------------
| | Investments in Real Estate Held for Sale 
    Seller Financed



28



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|                                                                           |  |          |            |  |               |            |     |               |  |           |              |  |          |            |   |             |  |          |          |   |  |   |   |  |  |   |            | 
|-------------------------------------------------------------------------- |  | -------- | ---------- |  | ------------- | ---------- | --- | ------------- |  | --------- | ------------ |  | -------- | ---------- | - | ----------- |  | -------- | -------- | - |  | - | - |  |  | - | ---------- | 
|                                                                           |  |          |            |  |               |            |     |               |  | Principal |              |  |          |            |  
|                                                                           |  |          |            |  |               |            |     |               |  | Payments  |              |  |          |            |  
|                                                                           |  |          |            |  |               | Balance at |     |               |  |           | Received     |  |          | Valuation/ |   | Balance at  | 
|                                                                           |  | Date     |            |  | Percentage of |            |     | September 30, |  |           |              |  | from     |            |   | Other       |  | June 30, |         
|Description                                                                |  | Acquired |            |  | Ownership     |            |     | 2004          |  |           | Acquisitions |  | Borrower |            |   | Adjustments |  | 2005     |         
|                                                                           |  |          |            |  |               |            |     |               |  |           |              |  |          |            |   |             |  |          |         
|An approximate 200-unit apartment complex located in Las Vegas,
    Nevada |  |          | 1/27/2003  |  |               |            | 5%  |               |  | $         | 171,000      |  |          | $          |  |             |  | $        |         |   |  | $ |  |  |  | $ | 171,000    | 
|A completed golf course and raw land in Mesquite, Nevada                   |  |          | 11/6/2002  |  |               |            | 55% |               |  |           | 1,475,000    |  |          |            |  |             |  |          |         |   |  |   |  |  |  |   | 1,475,000  | 
|36 acres of raw land in Mesquite, Nevada                                   |  |          | 11/27/2002 |  |               |            | 48% |               |  |           | 334,000      |  |          |            |  |             |  |          |         |   |  |   |  |  |  |   | 334,000    | 
|Assisted living facility in Las Vegas, Nevada                              |  |          | 9/23/2004  |  |               |            | 52% |               |  |           | 7,910,000    |  |          |            |  |             |  |          | (121,000 | ) |  |   |  |  |  |   | 7,789,000  | 
|Raw land in Mesquite, Nevada                                               |  |          | 11/27/2002 |  |               |            | 53% |               |  |           | 911,000      |  |          |            |  |             |  |          | (306,000 | ) |  |   |  |  |  |   | 605,000    | 
|                                                                           |  |          |            |  |               |            |     |               |  |           |              |  |          |            |   |             |  |          |          |   | 
|                                                                           |  |          |            |  |               |            |     |               |  | $         | 10,801,000   |  |          | $          |  |             |  | $        | (427,000 | ) |  | $ |  |  |  | $ | 10,374,000 | 
|                                                                           |  |          |            |  |               |            |     |               |  |           |              |  |          |            |   |             |  |          |          |   | 



OFF-BALANCE SHEET ARRANGEMENTS




CONTRACTUAL OBLIGATIONS




|                       |  |                       |            |           |        |   |            |           |           |           |   |         |  |   |   |  |  |   |   | 
|---------------------- |  | --------------------- | ---------- | --------- | ------ | - | ---------- | --------- | --------- | --------- | - | ------- |  | - | - |  |  | - | - | 
|                       |  | Payment Due by Period
|                       |  |                      
|                       |  |                       |            | Less Than |        |   |            |           | More Than
|Contractual Obligation |  | Total                 |            |           | 1 Year |   |            | 1-3 Years |           | 3-5 Years |   | 5 Years
|                       |  |                       |            |           |        |   |            |           |           |           |   |        
|Secured borrowings     |  | $                     | 11,391,000 |           |        | $ | 11,391,000 |           |           | $         |  |         |  | $ |  |  |  | $ |  | 

CRITICAL ACCOUNTING ESTIMATES




| |                    
| | -------------------
| | Revenue Recognition



29



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|                                                                                  |  |                     |            |  
|--------------------------------------------------------------------------------- |  | ------------------- | ---------- | -
|                                                                                  |  | Increase (Decrease) |           
|Changed Assumption                                                                |  | in Interest Income  |           
|                                                                                  |  |                     |           
|Weighted average interest rate assumption increased by 1% or
    100 basis points |  | $                   | 499,000    |  
|Weighted average interest rate assumption increased by 5% or
    500 basis points |  | $                   | 2,495,000  |  
|Weighted average interest rate assumption decreased by 1% or
    100 basis points |  | $                   | (499,000   | )
|Weighted average interest rate assumption decreased by 5% or
    500 basis points |  | $                   | (2,495,000 | )





| |                                 
| | --------------------------------
| | Investments in Real estate loans







| |                          
| | -------------------------
| | Allowance for Loan Losses



30



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|                                                                           |  |                     |            |  
|-------------------------------------------------------------------------- |  | ------------------- | ---------- | -
|                                                                           |  | Increase (Decrease) |           
|                                                                           |  | in Allowance for    |           
|Changed Assumption                                                         |  | Loan Losses         |           
|                                                                           |  |                     |           
|Allowance for loan losses assumption increased by 1% of loan
    portfolio |  | $                   | 671,000    |  
|Allowance for loan losses assumption increased by 5% of loan
    portfolio |  | $                   | 3,357,000  |  
|Allowance for loan losses assumption decreased by 1% of loan
    portfolio |  | $                   | (671,000   | )
|Allowance for loan losses assumption decreased by 5% of loan
    portfolio |  | $                   | (3,375,000 | )







| |   |                                                                                                                                                                                                                                                                                                                                                                                            
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Declines in real estate market conditions which can cause a
    decrease in expected market value.                                                                                                                                                                                                                                                                                         
|
| |  | Discovery of undisclosed liens for community improvement bonds,
    easements and delinquent property taxes.                                                                                                                                                                                                                                                                               
|
| |  | Lack of progress on real estate developments after we advance
    funds. We customarily utilize disbursement agents to monitor the
    progress of real estate developments and approve loan advances.
    After further inspection of the related property, progress on
    construction occasionally does not substantiate an increase in
    value to support the related loan advances.
|
| |  | Unanticipated legal or business issues that may arise subsequent
    to loan origination or upon the sale of foreclosed upon property.                                                                                                                                                                                                                                                     
|
| |  | Appraisals which are only opinions of value at the time of the
    appraisal may not accurately reflect the value of the property.                                                                                                                                                                                                                                                         



| |                          
| | -------------------------
| | Real Estate Held For Sale

Accounting for the
Impairment or Disposal of Long Lived Assets


31



---



##### Table of Contents







| |   |                                                                                                                              
| | - | -----------------------------------------------------------------------------------------------------------------------------
| |  | Management commits to a plan to sell the properties;                                                                         
|
| |  | The property is available for immediate sale in its present
    condition subject only to terms that are usual and customary;
|
| |  | An active program to locate a buyer and other actions required
    to complete a sale have been initiated;                   
|
| |  | The sale of the property is probable;                                                                                        
|
| |  | The property is being actively marketed for sale at a reasonable
    price; and                                              
|
| |  | Withdrawal or significant modification of the sale is not likely.                                                            



| |                                                
| | -----------------------------------------------
| | Real Estate Held For Sale  Seller
    Financed









| |                                                                       
| | ----------------------------------------------------------------------
| | Classification of Operating Results from Real Estate Held
    for Sale





| |                   
| | ------------------
| | Secured Borrowings

Accounting for
Transfers and Servicing of Financial Assets and Extinguishments
of Liabilities


32



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FACTORS AFFECTING OUR OPERATING RESULTS






| |                                        
| | ---------------------------------------
| | Risks of Investing in Real estate loans



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Our underwriting standards and procedures are more lenient than
    conventional lenders in that we will invest in loans to
    borrowers who will not be required to meet the credit standards
    of conventional real estate lenders. This may result in a higher
    rate of non-performing loans.                                                                                                                                                                                                                                                                                                        
|
| |  | We approve real estate loans more quickly than other real estate
    lenders. Due to the nature of loan approvals, there is a risk
    that the credit inquiry our Manager performs will not reveal all
    material facts pertaining to the borrower and the security.                                                                                                                                                                                                                                                                                                                                       
|
| |  | Our results of operations will vary with changes in interest
    rates and with the performance of the relevant real estate
    markets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| |  | If the economy is healthy, we expect that more people will
    borrow money to acquire, develop or renovate real property.
    However, if the economy grows too fast, interest rates may
    increase too much and the cost of borrowing may become too
    expensive. This could result in a slowdown in real estate
    lending which may mean we will have fewer loans to acquire, thus
    reducing the revenues and the distributions to our members.                                                                                                                                                   
|
| |  | If, at a time of relatively low interest rates, a borrower
    should prepay obligations that have a higher interest rate from
    an earlier period, investors will likely not be able to reinvest
    the funds in real estate loans earning that higher rate of
    interest. In the absence of a prepayment fee, the investors will
    receive neither the anticipated revenue stream at the higher
    rate nor any compensation for their loss. This in turn could
    harm our reputation and make it more difficult for us to attract
    investors willing to acquire interest in real estate loans.



| |                 
| | ----------------
| | Risk of Defaults





33



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##### Table of Contents







| |   |                                                                                                                                                                                                                                                          
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We may incur substantial legal fees and court costs in acquiring
    a mortgaged property through a foreclosure sale and/or
    bankruptcy proceedings.                                                                                                  
|
| |  | During the period of time when a defaulted loan is the subject
    of foreclosure proceedings, it is likely that we will earn less,
    if any, income from such loans, thereby reducing our earnings.                                                   
|
| |  | Properties foreclosed upon may not generate sufficient income
    from operations to meet expenses, such as property taxes,
    maintenance costs, mortgage payments, insurance cost and related
    charges.                                            
|
| |  | Operation of foreclosed properties my require us to spend
    substantial funds for an extended period until we are able to
    find a suitable buyer.                                                                                                   
|
| |  | We incur liability risks in owning and operating real property
    such as possible liability for injury to persons and property or
    for the cost involved in cleaning up any contamination by
    materials hazardous to the environment.            
|
| |  | Proceeds from the sale of foreclosed property may not generate
    full repayment of our loans and, in connection with such sale,
    we may be required to provide seller financing and incur the
    risk that the buyer may default on such financing.



| |                               
| | ------------------------------
| | Risks of Interest Rate Changes









| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) There can be no assurance that this permitted rate
    increase will be adequate if interest rates have increased
    beyond the range contemplated by our loan documents.                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|
| | (ii) If interest rates rise, borrowers under loans with
    monthly or quarterly principal payments may be compelled to
    extend their loans to decrease the principal paid with each
    payment because the interest component has increased. If this
    happens, there is a higher risk that the borrower may default on
    the extended loan, and the increase in the interest rate on the
    loan may not be adequate compensation for the increased risk.
    Distributions on real estate loans we place may decline if
    lenders are unable to reinvest at higher rates or if an
    increasing number of borrowers default on their loans.
|
| | (iii) If, at a time of relatively low interest rates, a
    borrower prepays obligations that have a higher interest rate
    from an earlier period, investors will likely not be able to
    reinvest the funds in real estate loans earning that higher rate
    of interest. In the absence of a prepayment fee, the investors
    will receive neither the anticipated revenue stream at the
    higher rate nor compensation for their loss. This in turn could
    harm our business reputation.                                                                                                                                                   



| |                          
| | -------------------------
| | Competition for Borrowers



34



---



##### Table of Contents







| |                                      
| | -------------------------------------
| | Effect of Fluctuations in the Economy



CAPITAL AND LIQUIDITY












35



---



##### Table of Contents













Accounting for
Transfers and Servicing of Financial Assets and Extinguishments
of Liabilities


36



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##### Table of Contents
















|         |                                                               
|-------- | --------------------------------------------------------------
|ITEM 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
    RISK









Interest Earning Assets


Aggregated by Maturity


Twelve Months Ended June 30, 2005


|                                 |  |      |            |   |      |   |            |      |  |   |           |   |      |   |            |  |       |   |   |  |  |   |   |  |  |   |            |  
|-------------------------------- |  | ---- | ---------- | - | ---- | - | ---------- | ---- |  | - | --------- | - | ---- | - | ---------- |  | ----- | - | - |  |  | - | - |  |  | - | ---------- | -
|Interest Earning Assets          |  | 2005 |            |   | 2006 |   |            | 2007 |  |   | 2008      |   | 2009 |   | Thereafter |  | Total |  
|                                 |  |      |            |   |      |   |            |      |  |   |           |   |      |   |            |  |       |  
|Investments in real estate loans |  | $    | 27,377,000 |   |      | $ | 31,201,000 |      |  | $ | 8,570,000 |   |      | $ |           |  |       | $ |  |  |  | $ |  |  |  | $ | 67,148,000 |  
|Weighted Average interest rates  |  |      | 11.52      | % |      |   | 11.22      | %    |  |   | 5.27      | % |      |   |           |  |       |   |  |  |  |   |  |  |  |   | 10.58      | %

37



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##### Table of Contents










|        |                                            
|------- | -------------------------------------------
|ITEM 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA








|        |                                                                                         
|------- | ----------------------------------------------------------------------------------------
|ITEM 9. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
    ACCOUNTING AND FINANCIAL DISCLOSURE








|         |                       
|-------- | ----------------------
|ITEM 9A. | CONTROL AND PROCEDURES

Disclosure Controls and Procedures






Managements Report on Internal Control Over Financial
Reporting










| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | The first material weakness identified insufficient resources of
    technical accounting and reporting expertise. This weakness
    relates to the oversight and review of financial transactions,
    which affects our ability to prepare and properly review
    financial statements and accompanying footnote disclosures in
    accordance with United States generally accepted accounting
    principles and the rules and regulations of the SEC.

38



---



##### Table of Contents





| |   |                                                                                                                                                                                 
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | As a result of the foregoing material weakness, there has been
    ineffective oversight of documentation of authorizations to
    ensure that procedures are properly executed.







| |                 
| | ----------------
| | Remediation Plan





| |   |                                                                                                                                                                                                                
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Hired a corporate controller with the requisite experience to
    assist and work directly with our Managers Chief Financial
    Officer;                                                                     
|
| |  | Hired an accounting manager with the requisite experience to
    assist and work directly with our Managers corporate
    controller;                                                                         
|
| |  | Created an additional position to assist with the financial
    reporting process and is in the process of identifying an
    individual for this position;                                                    
|
| |  | Implemented a mandatory weekly management meeting for all key
    personnel. This allows for financial reporting personnel to be
    consistently updated on significant matters affecting the
    Company; and
|
| |  | Implemented a Financial Reporting Review Committee, which
    reviews all periodic financial reporting documents prior to
    filing.                                                                          





| |                                                         
| | --------------------------------------------------------
| | Changes in Internal Control Over Financial
    Reporting



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Report of Independent Registered Public Accounting Firm






Internal
Control  Integrated Framework












| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | The first material weakness identified insufficient resources of
    technical accounting and reporting expertise. This weakness
    relates to the oversight and review of financial transactions,
    which affects the Companys ability to prepare and properly
    review financial statements and accompanying footnote
    disclosures in accordance with U.S. generally accepted
    accounting principles and the rules and regulations of the
    Security and Exchange Commission.
|
| |  | As a result of the foregoing material weakness, there has been
    ineffective oversight of documentation of authorizations to
    ensure that procedures are properly executed.                                                                                                                                                                                                                                                                                                             

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Internal Control  Integrated Framework Internal Control 
Integrated Framework




| |                                                
| | -----------------------------------------------
| | /s/ Moore Stephens Wurth Frazer and Torbet, LLP





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|         |                  
|-------- | -----------------
|ITEM 9B. | OTHER INFORMATION






PART III







|         |                                               
|-------- | ----------------------------------------------
|ITEM 10. | DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT





|                     |  |     |    |  |       |                                                                                         
|-------------------- |  | --- | -- |  | ----- | ----------------------------------------------------------------------------------------
|Name                 |  | Age |    |  | Title
|                     |  |     |    |  |      
|Michael V. Shustek   |  |     | 46 |  |       | Chairman of the Board, Chief Executive Officer, President and
    Director              
|John Alderfer        |  |     | 61 |  |       | Chief Financial Officer and Director, Treasurer                                         
|Michael J. Whiteaker |  |     | 55 |  |       | Vice President of Regulatory Affairs                                                    
|Daniel B. Stubbs     |  |     | 44 |  |       | Senior Vice President, Underwriting of Vestin Mortgage, a
    subsidiary of Vestin Group



|                              |  |     |    |  |       |         
|----------------------------- |  | --- | -- |  | ----- | --------
|Name                          |  | Age |    |  | Title
|                              |  |     |    |  |      
|Robert J. Aalberts            |  |     | 54 |  |       | Director
|Fredrick J. Zaffarese Leavitt |  |     | 34 |  |       | Director
|Roland M. Sansone             |  |     | 50 |  |       | Director





Robert J. Aalberts th


John W. Alderfer


42



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Roland M. Sansone


Michael V. Shustek


Daniel B. Stubbs


Michael J. Whiteaker


Fredrick J. Zaffarese Leavitt


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Audit Committee




Code of Ethics









|         |                       
|-------- | ----------------------
|ITEM 11. | EXECUTIVE COMPENSATION








|         |                                                                   
|-------- | ------------------------------------------------------------------
|ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
    MANAGEMENT



Equity Compensation Plan Information









|         |                                               
|-------- | ----------------------------------------------
|ITEM 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Transactions with Management and Others






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Transactions with the Funds








Transactions with other related parties











|         |                                       
|-------- | --------------------------------------
|ITEM 14. | PRINCIPAL ACCOUNTING FEES AND SERVICES



|                   |  |          |         |  |               |   |        | 
|------------------ |  | -------- | ------- |  | ------------- | - | ------ | 
|                   |  | June 30, |         |  | September 30, |  
|                   |  | 2005     |         |  | 2004          |  
|                   |  |          |         |  |               |  
|Audit Fees         |  | $        | 300,000 |  |               | $ | 93,000 | 
|Audit Related Fees |  | $        |        |  |               | $ |       | 
|Tax Fees           |  | $        |        |  |               | $ |       | 
|All Other Fees     |  | $        |        |  |               | $ |       | 



|                   |  |          |   |               |  |   |        | 
|------------------ |  | -------- | - | ------------- |  | - | ------ | 
|                   |  | June 30, |   | September 30, | 
|                   |  | 2005     |   | 2004          | 
|                   |  |          |   |               | 
|Audit Fees         |  | $        |  |               |  | $ |       | 
|Audit Related Fees |  | $        |  |               |  | $ | 49,000 | 
|Tax Fees           |  | $        |  |               |  | $ |       | 
|All Other Fees     |  | $        |  |               |  | $ |       | 



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de minimus





PART IV







|         |                                           
|-------- | ------------------------------------------
|ITEM 15. | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES





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EXHIBIT INDEX


|            |    |                         |  |                                                                                                 
|----------- | -- | ----------------------- |  | ------------------------------------------------------------------------------------------------
|Exhibit No. |    | Description of Exhibits
|            |    |                        
|            | 3  | .1(1)                   |  | Articles of Organization                                                                        
|            | 3  | .2(2)                   |  | Amended and Restated Operating Agreement (included as
    Exhibit A to the Companys prospectus)
|            | 10 | .1                      |  | Intercreditor Agreement                                                                         
|            | 31 | .1                      |  | Section 302 Certification of Michael V. Shustek                                                 
|            | 31 | .2                      |  | Section 302 Certification of John Alderfer                                                      
|            | 32 |                         |  | Certification Pursuant to U.S.C. 18 Section 1350                                                






|    |                                                                                                                                                                   
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Incorporated herein by reference to our Form S-11
    Registration Statement filed on December 21, 2000 (File
    No. 333-52484).                                 
|   
|(2) | Incorporated herein by reference to Post-Effective Amendment
    No. 4 to our Form S-11 Registration Statement filed on
    October 23, 2003 (File No. 333-52484).

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SIGNATURES






| |                                            
| | -------------------------------------------
| | Vestin Fund I, LLC                         
|
| | By: Vestin Mortgage, Inc., its sole manager



| |     |                       
| | --- | ----------------------
| | By: | /s/ Michael V. Shustek

| |                                         
| | ----------------------------------------
| |                                         
| | Michael V. Shustek                      
| | Chief Executive Officer and             
| | Director of the Manager                 
| | (Principal Executive Officer of Manager)



| |     |                  
| | --- | -----------------
| | By: | /s/ John Alderfer

| |                                       
| | --------------------------------------
| |                                       
| | John Alderfer                         
| | Chief Financial Officer of the Manager



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INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTARY
INFORMATION


|                                                            |                                   |                                                                  |     |     |      | 
|----------------------------------------------------------- | --------------------------------- | ---------------------------------------------------------------- | --- | --- | ---- | 
|                                                            |                                   | Page                                                             |    
|                                                            |                                   |                                                                  |    
|REPORT OF INDEPENDENT REGISTERED PUBLIC
    ACCOUNTING FIRM |                                   |                                                                  | F-2 |    
|FINANCIAL STATEMENTS                                        |                                   |                                                                  |     |    
|                                                            | Balance Sheets                    |                                                                  |     | F-3 |     
|                                                            | Statements of Income              |                                                                  |     | F-4 |     
|                                                            | Statements of Members Equity     |                                                                  |     | F-5 |     
|                                                            | Statements of Cash Flows          |                                                                  |     | F-6 |     
|                                                            | Notes to Financial Statements     |                                                                  |     | F-8 |     
|SUPPLEMENTARY INFORMATION                                   |                                   |                                                                  |     |    
|                                                            | Real estate loans on Real Estate: |                                                                  |     |     |     
|                                                            |                                   | Real estate loan Rollforward                                     |     |     | F-28 | 
|                                                            |                                   | Real estate loans by Type of Property                            |     |     | F-29 | 
|                                                            |                                   | Real estate loans by Lien Position                               |     |     | F-30 | 
|                                                            |                                   | Real estate loans that Exceed Three Percent
    of the Portfolio |     |     | F-31 | 

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Report of Independent Registered Public Accounting Firm










Internal Control 
Integrated Framework




| |                                                
| | -----------------------------------------------
| | /s/ Moore Stephens Wurth Frazer and Torbet, LLP





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VESTIN FUND I, LLC





BALANCE SHEETS


|                                                                                                                                                                                            |                                          |                                       |            |            |               |   |            |           |            | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------- | ------------------------------------- | ---------- | ---------- | ------------- | - | ---------- | --------- | ---------- | 
|                                                                                                                                                                                            |                                          | June 30,                              |            |            | September 30, |  
|                                                                                                                                                                                            |                                          | 2005                                  |            |            | 2004          |  
|                                                                                                                                                                                            |                                          |                                       |            |            |               |  
|ASSETS                                                                                                                                                                                     
|Cash                                                                                                                                                                                        |                                          | $                                     | 2,862,000  |            |               | $ | 9,830,000  |          
|Certificates of deposit                                                                                                                                                                     |                                          |                                       | 300,000    |            |               |   | 300,000    |          
|Interest and other receivables                                                                                                                                                              |                                          |                                       | 682,000    |            |               |   | 1,327,000  |          
|Note receivable, net of allowance of $2,000,000 at June 30,
    2005 and $0 at September 30, 2004                                                                                           |                                          |                                       | 119,000    |            |               |   | 119,000    |          
|Real estate held for sale                                                                                                                                                                   |                                          |                                       | 7,757,000  |            |               |   | 15,287,000 |          
|Real estate held for sale  seller financed                                                                                                                                                 |                                          |                                       | 10,374,000 |            |               |   | 10,801,000 |          
|Investment in mortgage loans, net of allowance for loan losses
    of $1,896,000 at June 30, 2005, and $600,000 at
    September 30, 2004                                                   |                                          |                                       | 54,878,000 |            |               |   | 47,344,000 |          
|Assets under secured borrowings                                                                                                                                                             |                                          |                                       | 11,391,000 |            |               |   | 6,134,000  |          
|                                                                                                                                                                                            |                                          |                                       |            |            |               |  
|                                                                                                                                                                                            |                                          | Total assets                          |            | $          | 88,363,000    |   |            | $         | 91,142,000 | 
|                                                                                                                                                                                            |                                          |                                       |            |            |               |  
|                                                                                                                                                                                           
|LIABILITIES AND MEMBERS EQUITY                                                                                                                                                            
|                                                                                                                                                                                           
|Liabilities                                                                                                                                                                                 |                                          |                                       |            |            |               |   |            |          
|                                                                                                                                                                                            | Accounts payable and accrued liabilities |                                       | $          | 443,000    |               |   | $          | 351,000   |           
|                                                                                                                                                                                            | Due to Manager                           |                                       |            | 922,000    |               |   |            | 652,000   |           
|                                                                                                                                                                                            | Due to Vestin Group                      |                                       |            | 2,000      |               |   |            | 5,000     |           
|                                                                                                                                                                                            | Due to Vestin Fund II                    |                                       |            | 1,560,000  |               |   |            | 1,470,000 |           
|                                                                                                                                                                                            | Due to Vestin Fund III                   |                                       |            | 6,000      |               |   |            |          |           
|                                                                                                                                                                                            | Secured borrowings                       |                                       |            | 11,391,000 |               |   |            | 6,134,000 |           
|                                                                                                                                                                                            | Deferred income                          |                                       |            | 768,000    |               |   |            | 252,000   |           
|                                                                                                                                                                                            |                                          |                                       |            |            |               |  
|                                                                                                                                                                                            |                                          | Total liabilities                     |            |            | 15,092,000    |   |            |           | 8,864,000  | 
|                                                                                                                                                                                            |                                          |                                       |            |            |               |  
|Members equity  authorized
    10,000,000 units, 7,686,323 units and
    8,354,057 units issued at $10 per unit and outstanding
    at June 30, 2005 and September 30, 2004, respectively |                                          |                                       | 73,271,000 |            |               |   | 82,278,000 |          
|                                                                                                                                                                                            |                                          |                                       |            |            |               |  
|                                                                                                                                                                                            |                                          | Total members equity                 |            |            | 73,271,000    |   |            |           | 82,278,000 | 
|                                                                                                                                                                                            |                                          |                                       |            |            |               |  
|                                                                                                                                                                                            |                                          | Total liabilities and members equity |            | $          | 88,363,000    |   |            | $         | 91,142,000 | 
|                                                                                                                                                                                            |                                          |                                       |            |            |               |  



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VESTIN FUND I, LLC





STATEMENTS OF INCOME


|                                    |                                                   |                          |           |             |              |   |           |               |            |   |               |           |            |   |           |           |            | 
|----------------------------------- | ------------------------------------------------- | ------------------------ | --------- | ----------- | ------------ | - | --------- | ------------- | ---------- | - | ------------- | --------- | ---------- | - | --------- | --------- | ---------- | 
|                                    |                                                   | For the Transition       |           |             | For the Nine |   |           | For the Year  |            |   | For the Year  |          
|                                    |                                                   | Period Ended             |           |             | Months Ended |   |           | Ended         |            |   | Ended         |          
|                                    |                                                   | June 30,                 |           |             | June 30,     |   |           | September 30, |            |   | September 30, |          
|                                    |                                                   | 2005                     |           |             | 2004         |   |           | 2004          |            |   | 2003          |          
|                                    |                                                   |                          |           |             |              |   |           |               |            |   |               |          
|                                    |                                                   |                          |           | (Unaudited) |              |   |           |               |           
|Revenues                            |                                                   |                          |           |             |              |   |           |               |            |   |               |           |            |   |           |          
|                                    | Interest income from investment in mortgage loans |                          | $         | 4,303,000   |              |   | $         | 5,781,000     |            |   | $             | 7,519,000 |            |   | $         | 9,194,000 |           
|                                    | Loan fees                                         |                          |           |            |              |   |           |              |            |   |               | 72,000    |            |   |           | 527,000   |           
|                                    | Gain on sale of real estate held for sale         |                          |           | 1,072,000   |              |   |           |              |            |   |               |          |            |   |           |          |           
|                                    | Revenue related to the sale of real estate        |                          |           |            |              |   |           | 4,667,000     |            |   |               | 4,667,000 |            |   |           |          |           
|                                    | Other income                                      |                          |           | 694,000     |              |   |           | 397,000       |            |   |               | 408,000   |            |   |           | 644,000   |           
|                                    |                                                   |                          |           |             |              |   |           |               |            |   |               |          
|                                    |                                                   | Total revenues           |           |             | 6,069,000    |   |           |               | 10,845,000 |   |               |           | 12,666,000 |   |           |           | 10,365,000 | 
|Operating expenses                  |                                                   |                          |           |             |              |   |           |               |            |   |               |           |            |   |           |          
|                                    | Management fees                                   |                          |           | 201,000     |              |   |           | 191,000       |            |   |               | 255,000   |            |   |           | 253,000   |           
|                                    | Provision for loan losses                         |                          |           | 1,296,000   |              |   |           | 100,000       |            |   |               | 100,000   |            |   |           | 400,000   |           
|                                    | Interest expense                                  |                          |           | 408,000     |              |   |           | 1,481,000     |            |   |               | 1,789,000 |            |   |           | 1,121,000 |           
|                                    | Loss on sale of real estate held for sale         |                          |           | 400,000     |              |   |           |              |            |   |               | 463,000   |            |   |           |          |           
|                                    | Write down on real estate held for sale           |                          |           | 1,271,000   |              |   |           | 521,000       |            |   |               | 535,000   |            |   |           | 3,383,000 |           
|                                    | Write off of deferred bond offering costs         |                          |           |            |              |   |           |              |            |   |               |          |            |   |           | 204,000   |           
|                                    | Expenses related to real estate held for sale     |                          |           | 708,000     |              |   |           | 368,000       |            |   |               | 597,000   |            |   |           | 467,000   |           
|                                    | Professional fees                                 |                          |           | 494,000     |              |   |           | 144,000       |            |   |               | 230,000   |            |   |           | 195,000   |           
|                                    | Other                                             |                          |           | 163,000     |              |   |           | 128,000       |            |   |               | 130,000   |            |   |           | 31,000    |           
|                                    |                                                   |                          |           |             |              |   |           |               |            |   |               |          
|                                    |                                                   | Total operating expenses |           |             | 4,941,000    |   |           |               | 2,933,000  |   |               |           | 4,099,000  |   |           |           | 6,054,000  | 
|                                    |                                                   |                          |           |             |              |   |           |               |            |   |               |          
|                                    |                                                   | NET INCOME               |           | $           | 1,128,000    |   |           | $             | 7,912,000  |   |               | $         | 8,567,000  |   |           | $         | 4,311,000  | 
|                                    |                                                   |                          |           |             |              |   |           |               |            |   |               |          
|Net income allocated to members     |                                                   | $                        | 1,128,000 |             |              | $ | 7,912,000 |               |            | $ | 8,567,000     |           |            | $ | 4,311,000 |          
|                                    |                                                   |                          |           |             |              |   |           |               |            |   |               |          
|Net income allocated to members per |                                                   |                          |           |             |              |   |           |               |            |   |               |           |            |   |           |          
|weighted average membership units   |                                                   | $                        | 0.14      |             |              | $ | 0.94      |               |            | $ | 1.03          |           |            | $ | 0.45      |          
|                                    |                                                   |                          |           |             |              |   |           |               |            |   |               |          
|Weighted average membership units   |                                                   |                          | 7,919,354 |             |              |   | 8,398,813 |               |            |   | 8,339,404     |           |            |   | 9,668,310 |          
|                                    |                                                   |                          |           |             |              |   |           |               |            |   |               |          



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VESTIN FUND I, LLC





STATEMENTS OF MEMBERS EQUITY


|                                      |  |       |            |   |        |   |             |  
|------------------------------------- |  | ----- | ---------- | - | ------ | - | ----------- | -
|                                      |  | Units |            |   | Amount |  
|                                      |  |       |            |   |        |  
|Members equity at September 30, 2002 |  |       | 9,928,052  |   |        | $ | 98,999,000  |  
|Distributions                         |  |       |           |   |        |   | (10,364,000 | )
|Capital contribution from Manager     |  |       |           |   |        |   | 1,600,000   |  
|Reinvestments of distributions        |  |       | 231,487    |   |        |   | 2,315,000   |  
|Members redemptions                  |  |       | (1,034,973 | ) |        |   | (10,347,000 | )
|Net income                            |  |       |           |   |        |   | 4,312,000   |  
|                                      |  |       |            |   |        |  
|Members equity at September 30, 2003 |  |       | 9,124,566  |   |        |   | 86,515,000  |  
|Distributions                         |  |       |           |   |        |   | (5,098,000  | )
|Reinvestments of distributions        |  |       | 85,761     |   |        |   | 857,000     |  
|Members redemptions                  |  |       | (856,270   | ) |        |   | (8,563,000  | )
|Net income                            |  |       |           |   |        |   | 8,567,000   |  
|                                      |  |       |            |   |        |  
|Members equity at September 30, 2004 |  |       | 8,354,057  |   |        |   | 82,278,000  |  
|Distributions                         |  |       |           |   |        |   | (3,694,000  | )
|Reinvestments of distributions        |  |       | 48,930     |   |        |   | 489,000     |  
|Members redemptions                  |  |       | (716,664   | ) |        |   | (6,930,000  | )
|Net income                            |  |       |           |   |        |   | 1,128,000   |  
|                                      |  |       |            |   |        |  
|Members equity at June 30, 2005      |  |       | 7,686,323  |   |        | $ | 73,271,000  |  
|                                      |  |       |            |   |        |  



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##### Table of Contents



VESTIN FUND I, LLC





STATEMENTS OF CASH FLOWS


|                                      |                                                                                       |                                             |                                                     |             |              |            |   |               |          |            |               |             |          |            |   |             |             |            |  
|------------------------------------- | ------------------------------------------------------------------------------------- | ------------------------------------------- | --------------------------------------------------- | ----------- | ------------ | ---------- | - | ------------- | -------- | ---------- | ------------- | ----------- | -------- | ---------- | - | ----------- | ----------- | ---------- | -
|                                      |                                                                                       | For the Transition                          |                                                     |             | For the Nine |            |   | For the Year  |          |            | For the Year  |            
|                                      |                                                                                       | Period Ended                                |                                                     |             | Months Ended |            |   | Ended         |          |            | Ended         |            
|                                      |                                                                                       | June 30,                                    |                                                     |             | June 30,     |            |   | September 30, |          |            | September 30, |            
|                                      |                                                                                       | 2005                                        |                                                     |             | 2004         |            |   | 2004          |          |            | 2003          |            
|                                      |                                                                                       |                                             |                                                     |             |              |            |   |               |          |            |               |            
|                                      |                                                                                       |                                             |                                                     | (Unaudited) |              |            |   |               |         
|Cash flows from operating activities: |                                                                                       |                                             |                                                     |             |              |            |   |               |          |            |               |             |          |            |   |            
|                                      | Net income                                                                            |                                             | $                                                   | 1,128,000   |              |            | $ | 7,912,000     |          |            | $             | 8,567,000   |          |            | $ | 4,311,000   |            
|                                      | Adjustments to reconcile net income to net cash provided by
    operating activities: |                                             |                                                     |             |              |            |   |               |          |            |               |             |          |            |   |             |            
|                                      |                                                                                       | Write down of real estate held for sale     |                                                     |             | 1,271,000    |            |   |               | 521,000  |            |               |             |         |            |   |             | 3,259,000   |           
|                                      |                                                                                       | Write-off of deferred bond offering costs   |                                                     |             |             |            |   |               |         |            |               |             |         |            |   |             | 204,000     |           
|                                      |                                                                                       | Loss on sale of real estate held for sale   |                                                     |             | 400,000      |            |   |               |         |            |               |             | 998,000  |            |   |             | 3,247,000   |           
|                                      |                                                                                       | Gain on sale of real estate held for sale   |                                                     |             | (1,072,000   | )          |   |               |         |            |               |             |         |            |   |             |            |           
|                                      |                                                                                       | Provision for loan losses                   |                                                     |             | 1,296,000    |            |   |               | 100,000  |            |               |             | 100,000  |            |   |             | 400,000     |           
|                                      |                                                                                       | Change in operating assets and liabilities: |                                                     |             |              |            |   |               |          |            |               |             |          |            |   |             |             |           
|                                      |                                                                                       |                                             | Interest and other receivables                      |             |              | 612,000    |   |               |          | 286,000    |               |             |          | 226,000    |   |             |             | (450,000   | )
|                                      |                                                                                       |                                             | Due to Manager                                      |             |              | 270,000    |   |               |          | 98,000     |               |             |          | 260,000    |   |             |             | 272,000    |  
|                                      |                                                                                       |                                             | Due to related parties                              |             |              | 84,000     |   |               |          | 2,104,000  |               |             |          | 3,975,000  |   |             |             | 476,000    |  
|                                      |                                                                                       |                                             | Accounts payable and accrued liabilities            |             |              | 92,000     |   |               |          | (16,000    | )             |             |          | 326,000    |   |             |             | 23,000     |  
|                                      |                                                                                       |                                             | Note receivable from manager                        |             |              |           |   |               |          |           |               |             |          |           |   |             |             | 724,000    |  
|                                      |                                                                                       |                                             | Prepaid expenses                                    |             |              |           |   |               |          | 8,000      |               |             |          | 8,000      |   |             |             | (8,000     | )
|                                      |                                                                                       |                                             | Deferred income                                     |             |              | 516,000    |   |               |          | 152,000    |               |             |          | 223,000    |   |             |             | 28,000     |  
|                                      |                                                                                       |                                             |                                                     |             |              |            |   |               |          |            |               |            
|                                      |                                                                                       |                                             | Net cash provided by operating activities           |             |              | 4,597,000  |   |               |          | 11,165,000 |               |             |          | 14,683,000 |   |             |             | 12,486,000 |  
|                                      |                                                                                       |                                             |                                                     |             |              |            |   |               |          |            |               |            
|Cash flows from investing activities: |                                                                                       |                                             |                                                     |             |              |            |   |               |          |            |               |             |          |            |   |            
|                                      | Purchase of investments in mortgage loans                                             |                                             |                                                     | (20,565,000 | )            |            |   | (38,604,000   | )        |            |               | (39,473,000 | )        |            |   | (17,298,000 | )          
|                                      | Purchase of investments in mortgage loans:                                            |                                             |                                                     |             |              |            |   |               |          |            |               |             |          |            |   |             |            
|                                      |                                                                                       | from other related party                    |                                                     |             |             |            |   |               | (350,000 | )          |               |             | (350,000 | )          |   |             | (6,509,000  | )         
|                                      |                                                                                       | from Vestin Fund II                         |                                                     |             | (600,000     | )          |   |               |         |            |               |             |         |            |   |             | (14,470,000 | )         
|                                      |                                                                                       | from the manager                            |                                                     |             |             |            |   |               |         |            |               |             |         |            |   |             | (479,000    | )         
|                                      | Proceeds from loan payoff                                                             |                                             |                                                     | 11,490,000  |              |            |   | 34,229,000    |          |            |               | 35,011,000  |          |            |   | 35,079,000  |            
|                                      | Sale of investments in mortgage loans                                                 |                                             |                                                     |            |              |            |   |              |          |            |               | 5,528,000   |          |            |   | 1,030,000   |            
|                                      | Proceeds from sale of mortgage loans to:                                              |                                             |                                                     |             |              |            |   |               |          |            |               |             |          |            |   |             |            
|                                      |                                                                                       | Vestin Fund II                              |                                                     |             |             |            |   |               |         |            |               |             |         |            |   |             | 13,112,000  |           
|                                      |                                                                                       | Vestin Group                                |                                                     |             |             |            |   |               |         |            |               |             |         |            |   |             | 4,500,000   |           
|                                      |                                                                                       | Other related party                         |                                                     |             |             |            |   |               |         |            |               |             |         |            |   |             | 291,000     |           
|                                      | Proceeds from sale of investment in real estate                                       |                                             |                                                     | 8,245,000   |              |            |   |              |          |            |               |            |          |            |   | 1,600,000   |            
|                                      | Cash outlays for real estate held for sale                                            |                                             |                                                     |            |              |            |   | (3,099,000    | )        |            |               | (5,350,000  | )        |            |   |            |            
|                                      | Proceeds from redemptions of certificates of deposit                                  |                                             |                                                     |            |              |            |   | 875,000       |          |            |               | 875,000     |          |            |   |            |            
|                                      |                                                                                       |                                             |                                                     |             |              |            |   |               |          |            |               |            
|                                      |                                                                                       |                                             | Net cash provided by (used in) investing activities |             |              | (1,430,000 | ) |               |          | (6,949,000 | )             |             |          | (3,759,000 | ) |             |             | 16,856,000 |  
|                                      |                                                                                       |                                             |                                                     |             |              |            |   |               |          |            |               |            

F-6



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##### Table of Contents



VESTIN FUND I, LLC


STATEMENTS OF CASH FLOWS  (Continued)


|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |            |            |             |            |             |            |             |  
|--------------------------------------------------- | -------------------------------------------- | ----------------------------------------------------------------------------------------------------- | ------------------------------------- | ----------- | ------------ | ----------- | ---------- | ------------- | --------- | ----------- | ------------- | ---------- | ---------- | ----------- | ---------- | ----------- | ---------- | ----------- | -
|                                                    |                                              | For the Transition                                                                                    |                                       |             | For the Nine |             |            | For the Year  |           |             | For the Year  |           
|                                                    |                                              | Period Ended                                                                                          |                                       |             | Months Ended |             |            | Ended         |           |             | Ended         |           
|                                                    |                                              | June 30,                                                                                              |                                       |             | June 30,     |             |            | September 30, |           |             | September 30, |           
|                                                    |                                              | 2005                                                                                                  |                                       |             | 2004         |             |            | 2004          |           |             | 2003          |           
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              |                                                                                                       |                                       | (Unaudited) |              |             |            |               |          
|Cash flows from financing activities:               |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |            |            |             |            |            
|                                                    | Payment on note payable                      |                                                                                                       |                                       |            |              |             |            |              |           |             |               | (2,000,000 | )          |             |            |            |           
|                                                    | Members distributions, net of reinvestments |                                                                                                       |                                       | (3,205,000  | )            |             |            | (3,057,000    | )         |             |               | (4,241,000 | )          |             |            | (8,049,000  | )         
|                                                    | Members redemptions                         |                                                                                                       |                                       | (6,930,000  | )            |             |            | (8,296,000    | )         |             |               | (8,562,000 | )          |             |            | (10,348,000 | )         
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              |                                                                                                       | Net cash used in financing activities |             |              | (10,135,000 | )          |               |           | (11,353,000 | )             |            |            | (14,803,000 | )          |             |            | (18,397,000 | )
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              |                                                                                                       | NET CHANGE IN CASH                    |             |              | (6,968,000  | )          |               |           | (7,137,000  | )             |            |            | (3,879,000  | )          |             |            | 10,945,000  |  
|Cash, beginning of period                           |                                              |                                                                                                       | 9,830,000                             |             |              |             | 13,708,000 |               |           |             | 13,708,000    |            |            |             | 2,763,000  |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|Cash, end of period                                 |                                              | $                                                                                                     | 2,862,000                             |             |              | $           | 6,571,000  |               |           | $           | 9,829,000     |            |            | $           | 13,708,000 |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|Supplemental disclosures of cash flows information: |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |            |            |             |            |            
|                                                    | Non-cash investing and financing activities: |                                                                                                       |                                       |             |              |             |            |               |           |             |               |            |            |             |            |             |           
|                                                    |                                              | Deferred offering costs paid by manager                                                               |                                       | $           |             |             |            | $             |          |             |               | $          |           |             |            | $           | 125,000    |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              | Change in loans funded through secured borrowing                                                      |                                       | $           | 5,256,000    |             |            | $             | 1,319,000 |             |               | $          | 14,189,000 |             |            | $           | 13,686,000 |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              | Real estate held for sale acquired through foreclosure                                                |                                       | $           | 2,149,000    |             |            | $             | 3,271,000 |             |               | $          | 6,580,521  |             |            | $           | 36,920,000 |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              | Loans rewritten with same or similar property as collateral                                           |                                       | $           | 868,000      |             |            | $             | 5,579,000 |             |               | $          | 5,759,000  |             |            | $           | 14,348,000 |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              | Reduction in Note Payable to Fund II due to valuation
    allowance on real estate held for sale      |                                       | $           |             |             |            | $             | 455,000   |             |               | $          | 455,000    |             |            | $           |           |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              | Investment in real estate held for sale reclassified from
    interest receivable                     |                                       | $           | 33,000       |             |            | $             |          |             |               | $          |           |             |            | $           |           |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              | Investment in mortgage loans on real estate acquired for
    investments in real estate held for sale |                                       | $           |             |             |            | $             |          |             |               | $          |           |             |            | $           | 479,000    |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              | Note receivable related to capital contribution by Manager                                            |                                       | $           |             |             |            | $             |          |             |               | $          |           |             |            | $           | 724,000    |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              | In substance payoff of payable to Manager related to capital
    contribution by Manager              |                                       | $           |             |             |            | $             |          |             |               | $          |           |             |            | $           | 876,000    |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              | Sale of rights to receive proceeds of guarantee                                                       |                                       | $           |             |             |            | $             |          |             |               | $          |           |             |            | $           | 3,084,000  |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              | Note receivable from guarantor in exchange for release of
    guarantee                               |                                       | $           |             |             |            | $             |          |             |               | $          | 119,000    |             |            | $           |           |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           
|                                                    |                                              | Sale of real estate held for sale where we provide the financing                                      |                                       | $           |             |             |            | $             |          |             |               | $          | 7,910,000  |             |            | $           |           |            
|                                                    |                                              |                                                                                                       |                                       |             |              |             |            |               |           |             |               |           



F-7



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##### Table of Contents



VESTIN FUND I, LLC





NOTES TO FINANCIAL STATEMENTS


June 30, 2005


NOTE A  ORGANIZATION




| |             
| | ------------
| | Organization



















F-8



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)






| |                     
| | --------------------
| | Management Estimates





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





| |                    
| | -------------------
| | Revenue Recognition





| |                                 
| | --------------------------------
| | Investments in Real estate loans





F-9



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)








| |                          
| | -------------------------
| | Allowance for Loan Losses









| |   |                                                                                                                                                                                                                                                                                                                                                                                            
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Declines in real estate market conditions which can cause a
    decrease in expected market value.                                                                                                                                                                                                                                                                                         
|
| |  | Discovery of undisclosed liens for community improvement bonds,
    easements and delinquent property taxes.                                                                                                                                                                                                                                                                               
|
| |  | Lack of progress on real estate developments after we advance
    funds. We customarily utilize disbursement agents to monitor the
    progress of real estate developments and approve loan advances.
    After further inspection of the related property, progress on
    construction occasionally does not substantiate an increase in
    value to support the related loan advances.

F-10



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)




| |                          
| | -------------------------
| | Real Estate Held For Sale

Accounting for the
Impairment or Disposal of Long Lived Assets






| |   |                                                                                                                              
| | - | -----------------------------------------------------------------------------------------------------------------------------
| |  | Management commits to a plan to sell the properties;                                                                         
|
| |  | The property is available for immediate sale in its present
    condition subject only to terms that are usual and customary;
|
| |  | An active program to locate a buyer and other actions required
    to complete a sale have been initiated;                   
|
| |  | The sale of the property is probable;                                                                                        
|
| |  | The property is being actively marketed for sale at a reasonable
    price; and                                              
|
| |  | Withdrawal or significant modification of the sale is not likely.                                                            



| |                                                
| | -----------------------------------------------
| | Real Estate Held For Sale  Seller
    Financed









| |                                                                       
| | ----------------------------------------------------------------------
| | Classification of Operating Results from Real Estate
    Held for Sale



F-11



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)






| |                   
| | ------------------
| | Secured Borrowings

Accounting for
Transfers and Servicing of Financial Assets and Extinguishments
of Liabilities






| |                                    
| | -----------------------------------
| | Fair Value of Financial Instruments

Disclosures about Fair Value of Financial
Instruments




| |                                                                                                                                                                                                                                                                                                                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) Certificate of Deposits and Short Term
    Investments: The carrying amount of these instruments are at
    amortized cost which approximates fair value.                                                                                                                                                                                                                                                                 
|
| | (b) Investment in Real estate loans: The carrying
    value of these instruments, net of the allowance for loan
    losses, approximates the fair value due to their short-term
    maturities. Fair values for loans, which are delinquent and/or
    in foreclosure are indeterminable at this time as no ready
    market exists for these loans, but fair value may be
    significantly below the current carrying value.
|
| | (c) Assets under Secured Borrowing. The carrying
    amount of these instruments approximate fair value. The fair
    value is estimated based upon projected cash flows discounted at
    the estimated current interest rates at which similar loans
    would be made.                                                                                                                                                     



F-12



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)




| |                                
| | -------------------------------
| | Net Income Allocated to Members





| |         
| | --------
| | Segments





| |             
| | ------------
| | Income Taxes





| |                  
| | -----------------
| | Reclassifications



NOTE B  FINANCIAL INSTRUMENTS AND CONCENTRATIONS
OF CREDIT RISK












F-13



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)




NOTE C  INVESTMENTS IN REAL ESTATE LOANS






|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |        |   |  |  |       |  
|--------------------------- |  | ------ | -- |  | ---------- | - | ---------- | ------------- |  | --------- | ---------- | - | ------- | -------- | ------ | - |  |  | ----- | -
|                            |  | Number |    |  |            |   | Weighted   |               |  |           |            |  
|                            |  | of     |    |  |            |   | Average    |               |  | Portfolio |            |   | Loan to |         
|Loan Type                   |  | Loans  |    |  | Balance(1) |   |            | Interest Rate |  |           | Percentage |   |         | Value(2) |       
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       
|Acquisition and development |  |        | 4  |  |            | $ | 7,272,000  |               |  |           | 8.49       | % |         |          | 10.82  | % |  |  | 71.05 | %
|Bridge(3)                   |  |        | 5  |  |            |   | 7,063,000  |               |  |           | 10.16      | % |         |          | 10.52  | % |  |  | 50.78 | %
|Commercial                  |  |        | 10 |  |            |   | 31,376,000 |               |  |           | 9.99       | % |         |          | 46.73  | % |  |  | 67.17 | %
|Construction                |  |        | 3  |  |            |   | 3,712,000  |               |  |           | 9.40       | % |         |          | 5.53   | % |  |  | 69.94 | %
|Land                        |  |        | 7  |  |            |   | 17,725,000 |               |  |           | 12.89      | % |         |          | 26.40  | % |  |  | 61.67 | %
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       
|                            |  |        | 29 |  |            | $ | 67,148,000 |               |  |           | 10.58      | % |         |          | 100.00 | % |  |  | 64.56 | %
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       



|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |        |   |  |  |       |  
|--------------------------- |  | ------ | -- |  | ---------- | - | ---------- | ------------- |  | --------- | ---------- | - | ------- | -------- | ------ | - |  |  | ----- | -
|                            |  | Number |    |  |            |   | Weighted   |               |  |           |            |  
|                            |  | of     |    |  |            |   | Average    |               |  | Portfolio |            |   | Loan to |         
|Loan Type                   |  | Loans  |    |  | Balance(1) |   |            | Interest Rate |  |           | Percentage |   |         | Value(2) |       
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       
|Acquisition and development |  |        | 10 |  |            | $ | 18,810,000 |               |  |           | 9.71       | % |         |          | 32.02  | % |  |  | 63.01 | %
|Bridge(3)                   |  |        | 9  |  |            |   | 8,687,000  |               |  |           | 10.65      | % |         |          | 14.79  | % |  |  | 49.98 | %
|Commercial                  |  |        | 8  |  |            |   | 12,932,000 |               |  |           | 12.22      | % |         |          | 22.01  | % |  |  | 77.19 | %
|Construction                |  |        | 4  |  |            |   | 12,182,000 |               |  |           | 7.64       | % |         |          | 20.74  | % |  |  | 76.81 | %
|Land                        |  |        | 4  |  |            |   | 6,134,000  |               |  |           | 12.65      | % |         |          | 10.44  | % |  |  | 71.42 | %
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       
|                            |  |        | 35 |  |            | $ | 58,745,000 |               |  |           | 10.28      | % |         |          | 100.00 | % |  |  | 67.94 | %
|                            |  |        |    |  |            |   |            |               |  |           |            |   |         |          |       






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The following table reconciles the balance of the loan portfolio
    to the amount shown on the accompanying Balance Sheet. The
    contra accounts represent the amount of real estate held for
    sale sold to third parties where we provided financing. GAAP
    requires the borrower to have a certain percentage equity
    ownership (typically 20%) to allow us to record the sale of a
    property. In addition, the borrower must maintain a minimum
    commitment in the property on a continuing basis. Therefore,
    until the borrower meets these requirements, the investment in
    the new loan is reduced by the amount originally invested in the
    real estate held for sale.

|                                                            |  |               |             |   |                    |   |             |  
|----------------------------------------------------------- |  | ------------- | ----------- | - | ------------------ | - | ----------- | -
|                                                            |  | June 30, 2005 |             |   | September 30, 2004 |  
|                                                            |  | Balance       |             |   | Balance            |  
|                                                            |  |               |             |   |                    |  
|Balance per loan portfolio                                  |  | $             | 67,148,000  |   |                    | $ | 58,745,000  |  
|Less:                                                       |  |               |             |   |                    |   |             |  
|Seller financed loans included in real estate held for sale |  |               | (10,374,000 | ) |                    |   | (10,801,000 | )
|Allowance for loan losses                                   |  |               | (1,896,000  | ) |                    |   | (600,000    | )
|                                                            |  |               |             |   |                    |  
|Balance per accompanying Balance Sheet                      |  | $             | 54,878,000  |   |                    | $ | 47,344,000  |  
|                                                            |  |               |             |   |                    |  

F-14



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)




|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Loan to value ratios are based on appraisals obtained at the
    time of loan origination and may not reflect subsequent changes
    in value estimates. Such appraisals, which may be commissioned
    by the borrower and also may precede the placement of the loans
    with us, are generally dated no greater than 12 months
    prior to the date of loan origination. The appraisals may be for
    the current estimate of the as-if developed value of
    the property, which approximates the post-construction value of
    the collateralized property assuming that such property is
    developed. As-if developed values on raw land loans
    or acquisition and development loans often dramatically exceed
    the immediate sales value and may include anticipated zoning
    changes, and successful development by the purchaser; upon which
    development is dependent on availability of financing. As most
    of the appraisals will be prepared on an as-if
    developed basis, if a loan goes into default prior to any
    development of a project, the market value of the property may
    be substantially less than the appraised value. As a result,
    there may be less security than anticipated at the time the loan
    was originally made. If there is less security and a default
    occurs, we may not recover the full amount of the loan.
|   
|(3) | Bridge loans are a subcategory of commercial loans in which we
    provide interim financing for borrowers seeking long-term,
    permanent financing. Going forward, we expect to report bridge
    loans within the commercial category.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

|                     |  |          |            |  |            |  |               |          |  |   |            |  |  |  |        |  
|-------------------- |  | -------- | ---------- |  | ---------- |  | ------------- | -------- |  | - | ---------- |  |  |  | ------ | -
|                     |  | June 30, |            |  |            |  | September 30, |          |  |  
|                     |  | 2005     |            |  | Portfolio  |  |               | 2004     |  |   | Portfolio  | 
|Loan Type            |  | Balance* |            |  | Percentage |  |               | Balance* |  |   | Percentage | 
|                     |  |          |            |  |            |  |               |          |  |   |            | 
|First trust deeds    |  | $        | 66,645,000 |  |            |  | 99.25         | %        |  | $ | 57,830,000 |  |  |  | 98.44  | %
|Second trust deeds** |  |          | 503,000    |  |            |  | 0.75          | %        |  |   | 915,000    |  |  |  | 1.56   | %
|                     |  |          |            |  |            |  |               |          |  |   |            | 
|                     |  | $        | 67,148,000 |  |            |  | 100.00        | %        |  | $ | 58,745,000 |  |  |  | 100.00 | %
|                     |  |          |            |  |            |  |               |          |  |   |            | 






| |   |                   
| | - | ------------------
| | * | See note (1) above



|   |                                                                                                                  
|-- | -----------------------------------------------------------------------------------------------------------------
|** | Generally, our Second trust deeds are junior to a first trust
    deed position held by either us or our Manager.



|     |  |   |            | 
|---- |  | - | ---------- | 
|2005 |  | $ | 27,377,000 | 
|2006 |  |   | 31,201,000 | 
|2007 |  |   | 8,570,000  | 
|     |  |   |           
|     |  | $ | 67,148,000 | 
|     |  |   |           

F-15



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)




|               |  |          |            |  |            |  |               |          |  |   |            |  |  |  |        |  
|-------------- |  | -------- | ---------- |  | ---------- |  | ------------- | -------- |  | - | ---------- |  |  |  | ------ | -
|               |  | June 30, |            |  |            |  | September 30, |          |  |  
|               |  | 2005     |            |  | Portfolio  |  |               | 2004     |  |   | Portfolio  | 
|               |  | Balance* |            |  | Percentage |  |               | Balance* |  |   | Percentage | 
|               |  |          |            |  |            |  |               |          |  |   |            | 
|Arizona        |  | $        | 13,063,000 |  |            |  | 19.45         | %        |  | $ | 11,682,000 |  |  |  | 19.89  | %
|California     |  |          | 19,794,000 |  |            |  | 29.48         | %        |  |   | 11,475,000 |  |  |  | 19.53  | %
|Hawaii         |  |          | 4,139,000  |  |            |  | 6.16          | %        |  |   | 4,139,000  |  |  |  | 7.05   | %
|Nevada         |  |          | 24,428,000 |  |            |  | 36.38         | %        |  |   | 23,236,000 |  |  |  | 39.56  | %
|New York       |  |          | 3,320,000  |  |            |  | 4.94          | %        |  |   | 3,320,000  |  |  |  | 5.65   | %
|North Carolina |  |          |           |  |            |  |              |          |  |   | 90,000     |  |  |  | 0.15   | %
|Oklahoma       |  |          | 1,237,000  |  |            |  | 1.84          | %        |  |   | 996,000    |  |  |  | 1.70   | %
|Texas          |  |          | 1,167,000  |  |            |  | 1.75          | %        |  |   | 1,728,000  |  |  |  | 2.94   | %
|Utah           |  |          |           |  |            |  |              |          |  |   | 1,503,000  |  |  |  | 2.56   | %
|Washington     |  |          |           |  |            |  |              |          |  |   | 576,000    |  |  |  | 0.97   | %
|               |  |          |            |  |            |  |               |          |  |   |            | 
|               |  | $        | 67,148,000 |  |            |  | 100.00        | %        |  | $ | 58,745,000 |  |  |  | 100.00 | %
|               |  |          |            |  |            |  |               |          |  |   |            | 






| |   |                   
| | - | ------------------
| | * | See note (1) above



|                                                                                                   |  |          |           |  |               |  |             |            |  |               |         |  |  |  |       |  
|-------------------------------------------------------------------------------------------------- |  | -------- | --------- |  | ------------- |  | ----------- | ---------- |  | ------------- | ------- |  |  |  | ----- | -
|                                                                                                   |  | Balance  |           |  |               |  | Number of   |            |  | Percentage of |        
|                                                                                                   |  | June 30, |           |  |               |  | Months Non- |            |  | Total Loan    |        
|Description of Collateral                                                                          |  | 2005     |           |  | Maturity Date |  |             | Performing |  |               | Balance | 
|                                                                                                   |  |          |           |  |               |  |             |            |  |               |         | 
|4 cemeteries and 8 mortuaries in Hawaii                                                            |  | $        | 4,139,000 |  |               |  | 03/31/2004  |            |  |               | 15      |  |  |  | 12.17 | %
|Racetrack and hotel in Vernon, NY                                                                  |  |          | 3,320,000 |  |               |  | 06/30/2005  |            |  |               | 10      |  |  |  | 12.77 | %
|25 acres tentatively mapped for 104 single family
    residential lots in Palm Springs, California |  |          | 66,000    |  |               |  | 01/23/2006  |            |  |               | 8       |  |  |  | 5.11  | %
|4 separate commercial parcels in Rancho Cucamonga, Palm Springs,
    and Cathedral City, CA        |  |          | 51,000    |  |               |  | 04/16/2005  |            |  |               | 3       |  |  |  | 0.72  | %
|Development of 400 single and multi-family residential lots in
    Cathedral City, California      |  |          | 503,000   |  |               |  | 04/20/2005  |            |  |               | 8       |  |  |  | 7.74  | %
|                                                                                                   |  |          |           |  |               |  |             |            |  |               |         | 
|                                                                                                   |  | $        | 8,079,000 |  |               |  |             |            |  |               |         |  |  |  |       |  
|                                                                                                   |  |          |           |  |               |  |             |            |  |               |         | 



F-16



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)






|                            |  |               |         |  |            |   |           |            |          |      |   |  |  |   |           | 
|--------------------------- |  | ------------- | ------- |  | ---------- | - | --------- | ---------- | -------- | ---- | - |  |  | - | --------- | 
|                            |  | Balance       |         |  |            |   |           |            | Balance  |     
|                            |  | September 30, |         |  |            |   |           |            | June 30, |     
|Description                 |  | 2004          |         |  | Provisions |   |           | Deductions |          | 2005 |  
|                            |  |               |         |  |            |   |           |            |          |      |  
|General Valuation Allowance |  | $             | 600,000 |  |            | $ | 71,000    |            |          | $    |  |  |  | $ | 671,000   | 
|Specific allowance          |  |               |        |  |            |   | 1,225,000 |            |          |      |  |  |  |   | 1,225,000 | 
|                            |  |               |         |  |            |   |           |            |          |      |   | 
|Total                       |  | $             | 600,000 |  |            | $ | 1,296,000 |            |          | $    |  |  |  | $ | 1,896,000 | 
|                            |  |               |         |  |            |   |           |            |          |      |   | 

Rightstar Allowance






| |                                
| | -------------------------------
| | Asset Quality and Loan Reserves



F-17



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)






| |   |                                                                                                             
| | - | ------------------------------------------------------------------------------------------------------------
| |  | prevailing economic conditions;                                                                             
|
| |  | historical experience;                                                                                      
|
| |  | the nature and volume of the loan portfolio;                                                                
|
| |  | the borrowers financial condition and adverse situations
    that may affect the borrowers ability to pay;
|
| |  | evaluation of industry trends; and                                                                          
|
| |  | estimated net realizable value of any underlying collateral in
    relation to the loan amount.             



NOTE D  RELATED PARTY TRANSACTIONS




| |                                        
| | ---------------------------------------
| | Transactions with Management and Others









F-18



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)




| |                            
| | ---------------------------
| | Transactions with the Funds









| |                                        
| | ---------------------------------------
| | Transactions with other related parties





NOTE E  REAL ESTATE HELD FOR SALE




F-19



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)




|                                                                        |  |          |            |            |           |  |         |               |  |   |              |      |         |            |            |         |             |   |             |          |  |          |           |   |  |   |            |   |  |   |           | 
|----------------------------------------------------------------------- |  | -------- | ---------- | ---------- | --------- |  | ------- | ------------- |  | - | ------------ | ---- | ------- | ---------- | ---------- | ------- | ----------- | - | ----------- | -------- |  | -------- | --------- | - |  | - | ---------- | - |  | - | --------- | 
|                                                                        |  |          |            |            |           |  |         |               |  |   |              | Gain |         |            | Write Down |         |             |  
|                                                                        |  |          |            | Percentage |           |  | Balance |               |  |   |              |      |         | (Loss) on  |            |         | on Real     |   |             | Balance  | 
|                                                                        |  | Date     |            |            | of        |  |         | September 30, |  |   |              |      | Proceed |            |            | Sale of |             |   | Estate Held |          |  | June 30, |          
|Description                                                             |  | Acquired |            |            | Ownership |  |         | 2004          |  |   | Acquisitions |      |         | from Sales |            |         | Real Estate |   |             | for Sale |  |          | 2005      |  
|                                                                        |  |          |            |            |           |  |         |               |  |   |              |      |         |            |            |         |             |   |             |          |  |          |           |  
|Custom residential property located in Santa Fe, New
    Mexico(2)      |  |          | 3/4/2003   |            |           |  | 93      | %             |  | $ | 1,052,000    |      |         | $          |           |         |             | $ | (798,000    | )        |  | $        | 24,000    |   |  | $ | (278,000   | ) |  | $ |          | 
|Land containing 166 residential lots in Henderson, Nevada(2)            |  |          | 2/28/2003  |            |           |  | 66      | %             |  |   | 5,412,000    |      |         |            |           |         |             |   |            |          |  |          |          |   |  |   | (354,000   | ) |  |   | 5,058,000 | 
|30 unit condominium complex in Las Vegas, Nevada(2)                     |  |          | 2/4/2003   |            |           |  | 17      | %             |  |   | 216,000      |      |         |            |           |         |             |   | (216,000    | )        |  |          |          |   |  |   |           |   |  |   |          | 
|126 unit, (207 bed) assisted living facility in Phoenix,
    Arizona(2) |  |          | 9/8/2004   |            |           |  | 10      | %             |  |   | 1,526,000    |      |         |            |           |         |             |   |            |          |  |          |          |   |  |   | (640,000   | ) |  |   | 886,000   | 
|460 acre residential sub-division in Lake Travis, Texas                 |  |          | 8/3/2004   |            |           |  | 34      | %             |  |   | 1,784,000    |      |         |            | 29,000     |         |             |   |            |          |  |          |          |   |  |   |           |   |  |   | 1,813,000 | 
|140 unit/224 bed senior facility in Mesa, Arizona(2)                    |  |          | 5/26/2004  |            |           |  | 14      | %             |  |   | 1,020,000    |      |         |            |           |         |             |   | (1,009,000  | )        |  |          | (11,000   | ) |  |   |           |   |  |   |          | 
|28 acres of raw land in Mesquite, Nevada(2)                             |  |          | 11/27/2002 |            |           |  | 58      | %             |  |   | 2,159,000    |      |         |            |           |         |             |   | (3,208,000  | )        |  |          | 1,049,000 |   |  |   |           |   |  |   |          | 
|Hotel/ Casino in Las Vegas, Nevada                                      |  |          | 2/2/2004   |            |           |  | 27      | %             |  |   | 2,118,000    |      |         |            |           |         |             |   | (2,118,000  | )        |  |          |          |   |  |   |           |   |  |   |          | 
|126 unit Hotel in Mesquite, Nevada(1)(2)                                |  |          | 10/4/2004  |            |           |  | 32      | %             |  |   |             |      |         |            | 2,153,000  |         |             |   | (1,764,000  | )        |  |          | (389,000  | ) |  |   |           |   |  |   |          | 
|                                                                        |  |          |            |            |           |  |         |               |  |   |              |      |         |            |            |         |             |   |             |          |  |          |           |  
|Total                                                                   |  |          |            |            |           |  |         |               |  | $ | 15,287,000   |      |         | $          | 2,182,000  |         |             | $ | (9,113,000  | )        |  | $        | 673,000   |   |  | $ | (1,272,000 | ) |  | $ | 7,757,000 | 
|                                                                        |  |          |            |            |           |  |         |               |  |   |              |      |         |            |            |         |             |   |             |          |  |          |           |  




(1) Foreclosures for the year ended June 30,
2005:




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | During October 2004, we took title to 32% of a 126 unit
    hotel in Mesquite, Nevada. Vestin Fund II owns the other
    68%. In January 2005, we and Fund II entered into an
    agreement to sell the property for $5.5 million, as noted
    below in (2). In addition, during June 2005, we entered into a
    settlement agreement with the guarantors of the loan in the
    amount of $2,000,000 in exchange for a release of their personal
    guarantees of which our share was approximately $1,350,000. The
    balance is secured by a second trust deed and is payable in a
    first installment of $100,000 due in July 2005 and interest only
    payments of 5% on $1,100,000 from July 2005 through July 2008,
    at which time the entire balance is due. The guarantors are
    entitled to a discount of $782,000 from the principal balance in
    the event the entire balance is paid by December 2006. The first
    installment was received and recognized as income in July 2005.
    Our portion was $32,000. Payments will be recognized as revenue
    when received.

(2) Sales of real estate held for sale for the year
ended June 30, 2005:




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | During March 2005, the custom residential property located in
    Santa Fe, New Mexico was sold for $860,000 of which our
    proceeds were approximately $798,000. During the quarter ended
    December 31, 2004, we wrote down the carrying value of this
    property by approximately $278,000 based on our estimate of the
    net realizable value of the property. Consequently, as a result
    of completion of the sale we recorded a gain of approximately
    $24,000.

F-20



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | During March 2005, the 126 unit hotel in Mesquite, Nevada
    was sold for $5.5 million of which our share of the
    proceeds was approximately $1.8 million which resulted in a
    loss upon sale of approximately $389,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| | During September 2004 we entered into an agreement to sell the
    remaining 28 acres of raw land in Mesquite, Nevada for
    $6.2 million, of which our portion was approximately
    $3.2 million. During the prior quarter, $150,000 was
    released from escrow representing an early release of funds. The
    transaction was finalized during December 2004 and resulted in a
    gain of $1.0 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| | During July 2003, we and Fund II entered into an agreement
    for the sale of a portion of our interest in 40 acres of
    land containing 354 residential lots in Henderson, Nevada. The
    agreement requires the buyer to purchase 138 lots for cash
    and gives the buyer an option to purchase the remaining 216 lots
    over the next three years at a predetermined price, which may be
    adjusted for potential value increases. Through June 30,
    2005, the buyer has purchased 188 lots of the 354 lots. We and
    Fund II recorded a valuation adjustment for the transition
    period ended June 30, 2005 of $354,000 and $180,000,
    respectively, to write down the carrying value of our respective
    interest in the parcel to the amount corresponding to the
    negotiated sale and option price. During July 2005, the buyer
    exercised its option to purchase an additional 84 lots for
    approximately $3.85 million, of which we received
    approximately $2.6 million, resulting in no further gain or
    loss.
|
| | During transition period ended June 30, 2005, sold our
    portion of the 30-unit condominium complex in Las Vegas, Nevada
    for $215,000. The transaction did not result in any gains or
    losses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| | During November 2004, we and Fund II sold the 140 Unit/224
    bed senior facility in Mesa, Arizona of which our consideration
    received totaled $1,009,000. We received cash of $160,000 and
    held back a promissory note and first deed of trust totaling
    $905,000. This transaction resulted in a loss of $11,000. The
    promissory note is payable in interest only payments of 8% on
    the principal balance outstanding. Commencing June 25, 2005
    through May 25, 2006, monthly payments shall increase to
    $15,000 and be applied to principal and accrued interest.
    Beginning June 25, 2006 through May 25, 2009 payments
    are to increase to $20,000 monthly. Due to uncertainty of
    collectibility, we have provided a valuation allowance for the
    entire balance of the promissory note. Payments will be
    recognized when received as a decrease to the value of the real
    estate held for sale.                                                                                                          



| |                                          
| | -----------------------------------------
| | Transactions subsequent to June 30, 2005:



F-21



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)


NOTE F  REAL ESTATE HELD FOR SALE 
SELLER FINANCED




|                                                                           |  |          |            |            |           |  |            |               |  |           |              |          |          |   |            |             |  |               |          |   |  |   |   |  |  |   |            | 
|-------------------------------------------------------------------------- |  | -------- | ---------- | ---------- | --------- |  | ---------- | ------------- |  | --------- | ------------ | -------- | -------- | - | ---------- | ----------- |  | ------------- | -------- | - |  | - | - |  |  | - | ---------- | 
|                                                                           |  |          |            |            |           |  |            |               |  | Principal |              |          |          |   |           
|                                                                           |  |          |            |            |           |  |            |               |  | Payments  |              |          |          |   |           
|                                                                           |  |          |            | Percentage |           |  | Balance at |               |  |           |              | Received |          |   | Valuation/ |             | 
|                                                                           |  | Date     |            |            | of        |  |            | September 30, |  |           |              |          | from     |   |            | Other       |  | Balance at    |         
|Description                                                                |  | Acquired |            |            | Ownership |  |            | 2004          |  |           | Acquisitions |          | Borrower |   |            | Adjustments |  | June 30, 2005 |         
|                                                                           |  |          |            |            |           |  |            |               |  |           |              |          |          |   |            |             |  |               |         
|An approximate 200-unit apartment complex located in Las Vegas,
    Nevada |  |          | 1/27/2003  |            |           |  | 5          | %             |  | $         | 171,000      |          |          | $ |           |             |  | $             |         |   |  | $ |  |  |  | $ | 171,000    | 
|A completed golf course and raw land in Mesquite, Nevada                   |  |          | 11/6/2002  |            |           |  | 55         | %             |  |           | 1,475,000    |          |          |   |           |             |  |               |         |   |  |   |  |  |  |   | 1,475,000  | 
|36 acres of raw land in Mesquite, Nevada                                   |  |          | 11/27/2002 |            |           |  | 48         | %             |  |           | 334,000      |          |          |   |           |             |  |               |         |   |  |   |  |  |  |   | 334,000    | 
|Assisted living facility in Las Vegas, Nevada                              |  |          | 9/23/2004  |            |           |  | 52         | %             |  |           | 7,910,000    |          |          |   |           |             |  |               | (121,000 | ) |  |   |  |  |  |   | 7,789,000  | 
|Raw land in Mesquite, Nevada                                               |  |          | 11/27/2002 |            |           |  | 53         | %             |  |           | 911,000      |          |          |   |           |             |  |               | (306,000 | ) |  |   |  |  |  |   | 605,000    | 
|                                                                           |  |          |            |            |           |  |            |               |  |           |              |          |          |   |            |             |  |               |          |   | 
|                                                                           |  |          |            |            |           |  |            |               |  | $         | 10,801,000   |          |          | $ |           |             |  | $             | (427,000 | ) |  | $ |  |  |  | $ | 10,374,000 | 
|                                                                           |  |          |            |            |           |  |            |               |  |           |              |          |          |   |            |             |  |               |          |   | 



NOTE G  NOTES RECEIVABLE






F-22



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)






NOTE H  SECURED BORROWINGS


Accounting for
Transfers and Servicing of Financial Assets and Extinguishments
of Liabilities






NOTE I  RECENT ACCOUNTING PRONOUNCEMENTS






F-23



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)








NOTE J  LEGAL MATTERS INVOLVING THE MANAGER








F-24



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)




NOTE K  LEGAL MATTERS INVOLVING THE COMPANY






NOTE L  REDEMPTION LIMITATION








F-25



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)




NOTE M  SELECTED QUARTERLY FINANCIAL DATA
(UNAUDITED)




|                                                                                 |  |         |           |  |         |   |           |         |  |   |            |   |  |   |           | 
|-------------------------------------------------------------------------------- |  | ------- | --------- |  | ------- | - | --------- | ------- |  | - | ---------- | - |  | - | --------- | 
|                                                                                 |  | First   |           |  | Second  |   |           | Third   |  |   | Transition |  
|                                                                                 |  | Quarter |           |  | Quarter |   |           | Quarter |  |   | Period     |  
|                                                                                 |  |         |           |  |         |   |           |         |  |   |            |  
|Revenues                                                                         |  | $       | 2,310,000 |  |         | $ | 2,154,000 |         |  | $ | 1,605,000  |   |  | $ | 6,069,000 | 
|Expenses                                                                         |  |         | 736,000   |  |         |   | 2,002,000 |         |  |   | 2,203,000  |   |  |   | 4,941,000 | 
|                                                                                 |  |         |           |  |         |   |           |         |  |   |            |  
|Net income (loss)                                                                |  | $       | 1,574,000 |  |         | $ | 152,000   |         |  | $ | (598,000   | ) |  | $ | 1,128,000 | 
|                                                                                 |  |         |           |  |         |   |           |         |  |   |            |  
|Net income (loss) allocated to members per weighted average
    membership units |  | $       | 0.19      |  |         | $ | 0.02      |         |  | $ | (0.08      | ) |  | $ | 0.14      | 
|                                                                                 |  |         |           |  |         |   |           |         |  |   |            |  
|Weighted average membership units                                                |  |         | 8,332,817 |  |         |   | 7,738,967 |         |  |   | 7,919,354  |   |  |   | 7,919,354 | 
|                                                                                 |  |         |           |  |         |   |           |         |  |   |            |  



|                                                                          |  |         |           |  |         |   |           |         |  |   |           |  |  |      |           |  |  |   |            | 
|------------------------------------------------------------------------- |  | ------- | --------- |  | ------- | - | --------- | ------- |  | - | --------- |  |  | ---- | --------- |  |  | - | ---------- | 
|                                                                          |  | First   |           |  | Second  |   |           | Third   |  |   | Fourth    |  |  |     
|                                                                          |  | Quarter |           |  | Quarter |   |           | Quarter |  |   | Quarter   |  |  | Year |          
|                                                                          |  |         |           |  |         |   |           |         |  |   |           |  |  |      |          
|Revenues                                                                  |  | $       | 2,048,000 |  |         | $ | 6,831,000 |         |  | $ | 1,966,000 |  |  | $    | 1,821,000 |  |  | $ | 12,666,000 | 
|Expenses                                                                  |  |         | 1,260,000 |  |         |   | 954,000   |         |  |   | 719,000   |  |  |      | 1,166,000 |  |  |   | 4,099,000  | 
|                                                                          |  |         |           |  |         |   |           |         |  |   |           |  |  |      |          
|Net income                                                                |  | $       | 788,000   |  |         | $ | 5,877,000 |         |  | $ | 1,247,000 |  |  | $    | 655,000   |  |  | $ | 8,567,000  | 
|                                                                          |  |         |           |  |         |   |           |         |  |   |           |  |  |      |          
|Net income allocated to members per weighted average membership
    units |  | $       | 0.09      |  |         | $ | 0.68      |         |  | $ | 0.15      |  |  | $    | 0.08      |  |  | $ | 1.03       | 
|                                                                          |  |         |           |  |         |   |           |         |  |   |           |  |  |      |          
|Weighted average membership units                                         |  |         | 9,110,711 |  |         |   | 8,664,702 |         |  |   | 8,311,724 |  |  |      | 8,385,189 |  |  |   | 8,339,404  | 
|                                                                          |  |         |           |  |         |   |           |         |  |   |           |  |  |      |          

NOTE N  SUBSEQUENT EVENTS






F-26



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##### Table of Contents



VESTIN FUND I, LLC


NOTES TO FINANCIAL STATEMENTS  (Continued)








NOTE O  OTHER MATTER




F-27



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##### Table of Contents



Schedule I


Vestin Fund I, LLC





MORTGAGE LOANS ON REAL ESTATE


MORTGAGE LOAN ROLLFORWARD


|                            |                              |                                              |             |   |            | 
|--------------------------- | ---------------------------- | -------------------------------------------- | ----------- | - | ---------- | 
|Balance, September 30, 2002 |                              | $                                            | 91,191,000  |  
|                            |                              |                                              |            
|                            | Additions during the period  |                                              |             |   |           
|                            |                              | New mortgage loans                           |             |   | 36,815,000 | 
|                            |                              | Mortgage loans bought                        |             |   | 21,360,000 | 
|                            |                              | Mortgage loans transferred                   |             |   | 4,149,000  | 
|                            | Deductions during the period |                                              |             |   |           
|                            |                              | Collections of principal                     |             |   | 35,079,000 | 
|                            |                              | Foreclosed loans (Real estate held for sale) |             |   | 32,960,000 | 
|                            |                              | Mortgage loans sold                          |             |   | 33,281,000 | 
|                            |                              |                                              |            
|                            |                              |                                              | (38,996,000 | )
|                            |                              |                                              |            
|Balance, September 30, 2003 |                              | $                                            | 52,195,000  |  
|                            |                              |                                              |            
|                            | Additions during the period  |                                              |             |   |           
|                            |                              | New mortgage loans                           |             |   | 53,535,000 | 
|                            |                              | Mortgage loans bought                        |             |   | 2,848,000  | 
|                            | Deductions during the period |                                              |             |   |           
|                            |                              | Collections of principal                     |             |   | 38,342,000 | 
|                            |                              | Foreclosed loans (Real estate held for sale) |             |   | 5,963,000  | 
|                            |                              | Mortgage loans sold                          |             |   | 5,528,000  | 
|                            |                              |                                              |            
|                            |                              |                                              | (6,550,000  | )
|                            |                              |                                              |            
|Balance, September 30, 2004 |                              | $                                            | 58,745,000  |  
|                            |                              |                                              |            
|                            | Additions during the period  |                                              |             |   |           
|                            |                              | New mortgage loans                           |             |   | 20,566,000 | 
|                            |                              | Mortgage loans bought                        |             |   | 600,000    | 
|                            | Deductions during the period |                                              |             |   |           
|                            |                              | Collections of principal                     |             |   | 11,490,000 | 
|                            |                              | Foreclosed loans (Real estate held for sale) |             |   | 1,273,000  | 
|                            |                              | Mortgage loans sold                          |             |   |           | 
|                            |                              |                                              |            
|                            |                              |                                              | (8,402,000  | )
|                            |                              |                                              |            
|Balance, June 30, 2005      |                              | $                                            | 67,148,000  |  
|                            |                              |                                              |            

F-28



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##### Table of Contents



Schedule II


Vestin Fund I, LLC





REAL ESTATE LOANS ON REAL ESTATE


REAL ESTATE LOANS BY TYPE OF PROPERTY




|                            |  |               |         |                |      |   |             |                |  |          |            |  |            |             |            |  |  |   |           | 
|--------------------------- |  | ------------- | ------- | -------------- | ---- | - | ----------- | -------------- |  | -------- | ---------- |  | ---------- | ----------- | ---------- |  |  | - | --------- | 
|                            |  |               |         |                |      |   |             |                |  | Amount   |           
|                            |  |               |         | Face Amount of |      |   | Carrying    |                |  | Maturity |            |  | Subject to |            
|Type of Property            |  | Interest Rate |         |                | Loan |   |             | Amount of Loan |  |          | Date       |  |            | Delinquency |           
|                            |  |               |         |                |      |   |             |                |  |          |            |  |            |             |           
|Acquisition and Development |  |               | 8%-12%  |                |      | $ | 79,162,000  |                |  | $        | 7,272,000  |  |            |             | 4/05-2/06  |  |  | $ | 503,000   | 
|Construction                |  |               | 8%-12%  |                |      | $ | 25,550,000  |                |  | $        | 3,712,000  |  |            |             | 8/05-7/06  |  |  | $ |          | 
|Commercial                  |  |               | 5%-14%  |                |      | $ | 130,828,000 |                |  | $        | 31,376,000 |  |            |             | 3/04-10/07 |  |  | $ | 7,459,000 | 
|Land                        |  |               | 10%-14% |                |      | $ | 102,579,000 |                |  | $        | 17,725,000 |  |            |             | 7/05-4/06  |  |  | $ |          | 
|Bridge                      |  |               | 10%-14% |                |      | $ | 29,800,000  |                |  | $        | 7,063,000  |  |            |             | 4/05-4/06  |  |  | $ | 117,000   | 



|                            |  |               |         |                |      |   |             |                |  |          |            |  |            |             |           |  |  |   |           | 
|--------------------------- |  | ------------- | ------- | -------------- | ---- | - | ----------- | -------------- |  | -------- | ---------- |  | ---------- | ----------- | --------- |  |  | - | --------- | 
|                            |  |               |         |                |      |   |             |                |  | Amount   |           
|                            |  |               |         | Face Amount of |      |   | Carrying    |                |  | Maturity |            |  | Subject to |            
|Type of Property            |  | Interest Rate |         |                | Loan |   |             | Amount of Loan |  |          | Date       |  |            | Delinquency |          
|                            |  |               |         |                |      |   |             |                |  |          |            |  |            |             |          
|Acquisition and Development |  |               | 8%-14%  |                |      | $ | 159,191,000 |                |  | $        | 18,810,000 |  |            |             | 2/02-3/06 |  |  | $ | 1,503,000 | 
|Construction                |  |               | 5%-14%  |                |      | $ | 31,529,000  |                |  | $        | 12,182,000 |  |            |             | 6/03-9/07 |  |  | $ | 2,140,000 | 
|Commercial                  |  |               | 10%-14% |                |      | $ | 82,535,000  |                |  | $        | 12,932,000 |  |            |             | 3/04-7/05 |  |  | $ | 7,459,000 | 
|Land                        |  |               | 12%-14% |                |      | $ | 34,379,000  |                |  | $        | 6,134,000  |  |            |             | 3/05-7/05 |  |  | $ |          | 
|Bridge                      |  |               | 10%-13% |                |      | $ | 36,131,000  |                |  | $        | 8,687,000  |  |            |             | 6/04-4/06 |  |  | $ | 68,000    | 

F-29



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##### Table of Contents



Schedule III


Vestin Fund I, LLC





REAL ESTATE LOANS ON REAL ESTATE


REAL ESTATE LOANS BY LIEN POSITION




|              |  |             |             |  |          |  |         |                |  |        |            |  |  |             |            |  |  |   |           | 
|------------- |  | ----------- | ----------- |  | -------- |  | ------- | -------------- |  | ------ | ---------- |  |  | ----------- | ---------- |  |  | - | --------- | 
|              |  |             |             |  |          |  |         |                |  | Amount |           
|              |  | Face Amount |             |  | Interest |  |         | Carrying       |  |        | Maturity   |  |  | Subject to  |           
|Lien Position |  | of Loan     |             |  | Rate     |  |         | Amount of Loan |  |        | Date       |  |  | Delinquency |           
|              |  |             |             |  |          |  |         |                |  |        |            |  |  |             |           
|1st           |  | $           | 361,419,000 |  |          |  | 5.0%-14 | %              |  | $      | 66,645,000 |  |  |             | 3/04-10/07 |  |  | $ | 7,576,000 | 
|2nd           |  | $           | 6,500,000   |  |          |  | 10.0%   |                |  | $      | 503,000    |  |  |             | 4/05       |  |  | $ | 503,000   | 



|              |  |             |             |  |          |  |             |                |  |        |            |  |  |             |            |  |  |   |            | 
|------------- |  | ----------- | ----------- |  | -------- |  | ----------- | -------------- |  | ------ | ---------- |  |  | ----------- | ---------- |  |  | - | ---------- | 
|              |  |             |             |  |          |  |             |                |  | Amount |           
|              |  | Face Amount |             |  | Interest |  |             | Carrying       |  |        | Maturity   |  |  | Subject to  |           
|Lien Position |  | of Loan     |             |  | Rate     |  |             | Amount of Loan |  |        | Date       |  |  | Delinquency |           
|              |  |             |             |  |          |  |             |                |  |        |            |  |  |             |           
|1st           |  | $           | 340,940,000 |  |          |  | 5.0%-14%    |                |  | $      | 57,831,000 |  |  |             | 10/04-9/04 |  |  | $ | 11,170,000 | 
|2nd           |  | $           | 2,825,000   |  |          |  | 10.0%-13.0% |                |  | $      | 915,000    |  |  |             | 12/04-3/05 |  |  | $ |           | 

F-30



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##### Table of Contents



Schedule IV


Vestin Fund I, LLC





LOANS ON REAL ESTATE


REAL ESTATE LOANS THAT EXCEED THREE PERCENT


OF THE PORTFOLIO




|                            |  |          |        |  |          |  |         |          |  |  |             |  |  |                |            |  |                |   |           |  |  |   |           | 
|--------------------------- |  | -------- | ------ |  | -------- |  | ------- | -------- |  |  | ----------- |  |  | -------------- | ---------- |  | -------------- | - | --------- |  |  | - | --------- | 
|                            |  | Interest |        |  | Maturity |  |         | Lien     |  |  | Face Amount |  |  | Carrying       |            |  | Amount Subject |  
|Description of Loan         |  | Rate     |        |  | Date     |  |         | Position |  |  | of Loan     |  |  | Amount of Loan |            |  | to Delinquency |  
|                            |  |          |        |  |          |  |         |          |  |  |             |  |  |                |            |  |                |  
|Land                        |  |          | 13.00% |  |          |  | 8/18/05 |          |  |  | 1st         |  |  | $              | 7,620,000  |  |                | $ | 2,165,000 |  |  | $ |          | 
|Construction                |  |          | 8.00%  |  |          |  | 8/15/05 |          |  |  | 1st         |  |  | $              | 9,500,000  |  |                | $ | 2,414,000 |  |  | $ |          | 
|Acquisition and Development |  |          | 9.00%  |  |          |  | 7/13/05 |          |  |  | 1st         |  |  | $              | 30,000,000 |  |                | $ | 2,426,000 |  |  | $ |          | 
|Bridge                      |  |          | 11.00% |  |          |  | 6/30/05 |          |  |  | 1st         |  |  | $              | 26,000,000 |  |                | $ | 3,320,000 |  |  | $ | 3,320,000 | 
|Commercial                  |  |          | 11.00% |  |          |  | 7/14/05 |          |  |  | 1st         |  |  | $              | 12,500,000 |  |                | $ | 3,324,000 |  |  | $ |          | 
|Land                        |  |          | 14.00% |  |          |  | 4/15/06 |          |  |  | 1st         |  |  | $              | 6,526,000  |  |                | $ | 3,400,000 |  |  | $ |          | 
|Land                        |  |          | 10.00% |  |          |  | 3/30/06 |          |  |  | 1st         |  |  | $              | 35,000,000 |  |                | $ | 3,672,000 |  |  | $ |          | 
|Bridge                      |  |          | 14.00% |  |          |  | 3/31/04 |          |  |  | 1st         |  |  | $              | 34,000,000 |  |                | $ | 4,139,000 |  |  | $ | 4,139,000 | 
|Land                        |  |          | 14.00% |  |          |  | 2/15/06 |          |  |  | 1st         |  |  | $              | 21,632,000 |  |                | $ | 4,181,000 |  |  | $ |          | 
|Acquisition and Development |  |          | 8.00%  |  |          |  | 1/25/06 |          |  |  | 1st         |  |  | $              | 35,000,000 |  |                | $ | 4,305,000 |  |  | $ |          | 
|Commercial                  |  |          | 12.00% |  |          |  | 2/8/06  |          |  |  | 1st         |  |  | $              | 6,000,000  |  |                | $ | 5,989,000 |  |  | $ |          | 
|Bridge                      |  |          | 10.00% |  |          |  | 4/30/06 |          |  |  | 1st         |  |  | $              | 15,000,000 |  |                | $ | 6,684,000 |  |  | $ |          | 
|Commercial                  |  |          | 5.00%  |  |          |  | 9/21/07 |          |  |  | 1st         |  |  | $              | 15,334,000 |  |                | $ | 7,789,000 |  |  | $ |          | 



|                            |  |          |        |  |          |  |         |          |  |  |             |  |  |                |            |  |                |   |           |  |  |   |           | 
|--------------------------- |  | -------- | ------ |  | -------- |  | ------- | -------- |  |  | ----------- |  |  | -------------- | ---------- |  | -------------- | - | --------- |  |  | - | --------- | 
|                            |  | Interest |        |  | Maturity |  |         | Lien     |  |  | Face Amount |  |  | Carrying       |            |  | Amount Subject |  
|Description of Loan         |  | Rate     |        |  | Date     |  |         | Position |  |  | of Loan     |  |  | Amount of Loan |            |  | to Delinquency |  
|                            |  |          |        |  |          |  |         |          |  |  |             |  |  |                |            |  |                |  
|Land                        |  |          | 14.00% |  |          |  | 7/21/05 |          |  |  | 1st         |  |  | $              | 8,645,000  |  |                | $ | 1,500,000 |  |  | $ |          | 
|Acquisition and Development |  |          | 14.00% |  |          |  | 2/1/02  |          |  |  | 1st         |  |  | $              | 7,000,000  |  |                | $ | 1,503,000 |  |  | $ | 1,503,000 | 
|Acquisition and Development |  |          | 13.00% |  |          |  | 4/22/05 |          |  |  | 1st         |  |  | $              | 20,000,000 |  |                | $ | 1,782,000 |  |  | $ |          | 
|Construction                |  |          | 11.00% |  |          |  | 5/21/05 |          |  |  | 1st         |  |  | $              | 6,000,000  |  |                | $ | 2,000,000 |  |  | $ |          | 
|Construction                |  |          | 14.00% |  |          |  | 6/18/03 |          |  |  | 1st         |  |  | $              | 6,705,000  |  |                | $ | 2,140,000 |  |  | $ | 2,140,000 | 
|Acquisition and Development |  |          | 9.00%  |  |          |  | 1/13/05 |          |  |  | 1st         |  |  | $              | 30,000,000 |  |                | $ | 2,232,000 |  |  | $ |          | 
|Land                        |  |          | 12.00% |  |          |  | 3/18/05 |          |  |  | 1st         |  |  | $              | 12,360,000 |  |                | $ | 2,308,000 |  |  | $ |          | 
|Acquisition and Development |  |          | 8.00%  |  |          |  | 8/15/05 |          |  |  | 1st         |  |  | $              | 9,500,000  |  |                | $ | 2,720,000 |  |  | $ |          | 
|Commercial                  |  |          | 11.00% |  |          |  | 7/14/05 |          |  |  | 1st         |  |  | $              | 12,500,000 |  |                | $ | 3,000,000 |  |  | $ |          | 
|Commercial                  |  |          | 11.00% |  |          |  | 6/30/05 |          |  |  | 1st         |  |  | $              | 26,000,000 |  |                | $ | 3,320,000 |  |  | $ | 3,320,000 | 
|Acquisition and Development |  |          | 10.00% |  |          |  | 3/30/06 |          |  |  | 1st         |  |  | $              | 35,000,000 |  |                | $ | 3,672,000 |  |  | $ |          | 
|Acquisition and Development |  |          | 8.00%  |  |          |  | 1/25/06 |          |  |  | 1st         |  |  | $              | 35,000,000 |  |                | $ | 4,106,000 |  |  | $ |          | 
|Commercial                  |  |          | 14.00% |  |          |  | 3/31/04 |          |  |  | 1st         |  |  | $              | 34,000,000 |  |                | $ | 4,139,000 |  |  | $ | 4,139,000 | 
|Bridge                      |  |          | 10.00% |  |          |  | 4/30/06 |          |  |  | 1st         |  |  | $              | 15,000,000 |  |                | $ | 6,684,000 |  |  | $ |          | 
|Commercial                  |  |          | 5.00%  |  |          |  | 9/21/07 |          |  |  | 1st         |  |  | $              | 15,334,000 |  |                | $ | 7,910,000 |  |  | $ |          | 

F-31



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##### Table of Contents



SIGNATURES






| |                   
| | ------------------
| | Vestin Fund I, LLC



| |     |                                        
| | --- | ---------------------------------------
| | By: | Vestin Mortgage, Inc., its sole manager
|
| | By: | /s/ Michael V. Shustek                 

| |                                                    
| | ---------------------------------------------------
| |                                                    
| | Michael V. Shustek                                 
| | Chief Executive Officer and Director of the Manager
| | (Principal Executive Officer of Manager)           



| |     |                  
| | --- | -----------------
| | By: | /s/ John Alderfer

| |                                       
| | --------------------------------------
| |                                       
| | John Alderfer                         
| | Chief Financial Officer of the Manager





---



##### Table of Contents



EXHIBIT INDEX


|            |    |                         |  |                                                                                             
|----------- | -- | ----------------------- |  | --------------------------------------------------------------------------------------------
|Exhibit No. |    | Description of Exhibits
|            |    |                        
|            | 3  | .1(1)                   |  | Articles of Organization, as amended                                                        
|           
|            | 3  | .2(2)                   |  | Third Amended and Restated Operating Agreement (included as
    Exhibit A to the prospectus)
|           
|            | 10 | .1                      |  | Intercreditor Agreement                                                                     
|            | 31 | .1                      |  | Section 302 Certification of Michael V. Shustek                                             
|           
|            | 31 | .2                      |  | Section 302 Certification of John Alderfer                                                  
|           
|            | 32 |                         |  | Certification Pursuant to U.S.C. 18 Section 1350                                            






|    |                                                                                                                                                                
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Incorporated herein by reference to our Form S-11
    Registration Statement filed on March 17, 2000 (File
    No. 333-32800).                                 
|   
|(2) | Incorporated herein by reference to Post-Effective Amendment
    No. 2 to our Form S-11 Registration Statement filed on
    April 6, 2001 (File No. 333-32800).