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

                                   FORM 10-QSB

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934
            For the quarterly period ended September 30, 1995


              Transitional Small Business Disclosure Format (check one):
                              Yes........No....X...

[ ]  TRANSITION  REPORT  PURSUANT  TO  SECTION  13  OR  15(d)  OF  THE
      SECURITIES  EXCHANGE  ACT OF 1934  For the  transition  period  from
                          _____________ to _____________

                       Commission file number 0-17771

                   FRANKLIN CREDIT MANAGEMENT CORPORATION
     (Exact name of small business issuer as specified in its charter)

          Delaware                                   75-2243266
(State or other jurisdiction of          (I.R.S. Employer Identification No.)
incorporation or organization)

                              Six Harrison Street
                           New York, New York  10013
                                (212) 925-8745
       (Address of principal executive offices, including zip code, and
                      telephone number, including area code)

                          Common Stock, $0.01 par value.
                                  (Title of Class)

      Check  whether  the issuer (1) filed all  reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act of 1934  during the past 12 months (or
for such shorter  period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
                                    Yes X  No

      APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING
                              PRECEDING FIVE YEARS

      Check whether the issuer has filed all documents and reports required to
be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution
of securities under a plan confirmed by a court.    Yes  X   No

                       APPLICABLE ONLY TO CORPORATE ISSUERS

State                the number of shares  outstanding  of each of the  issuer's
                     classes of common equity, as latest practicable date:
                            5,503,897 at November 13, 1995



<PAGE>





                          FRANKLIN CREDIT MANAGEMENT CORPORATION


                                        FORM 10-QSB

                                    SEPTEMBER 30, 1995


                                      C O N T E N T S
<TABLE>
<CAPTION>


PART I.           FINANCIAL INFORMATION                                  Page
<S>                                                                        <C>
Item 1. Financial Statements

       Consolidated Balance Sheets September 30, 1995 (unaudited) and
          December 31, 1994                                                 2

       Consolidated  Statements of Operations  (unaudited)  for the three months
            ended  September  30,  1995 and 1994 and for the nine  months  ended
            September 30, 1995 and 1994 3

      Consolidated Statements of Cash Flows (unaudited) for the
            nine months ended September 30, 1995 and 1994                   4

       Consolidated Statements of Stockholders' Equity                      5

       Financial Footnotes                                                 6-8

Item 2. Management's Discussion and Analysis of Financial Condition
            and Results of Operations                                      9-13



PART II.                OTHER INFORMATION

SIGNATURES                                                                 14
</TABLE>
<PAGE>
Item 1.  Financial Statements

FRANKLIN CREDIT MANAGEMENT CORPORATION AND AFFILIATES
(Formerly Miramar Resources, Inc.)

CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                   30-Sep-95          31-Dec-94
                                                  (unaudited)         (audited)
<S>                                                   <C>                <C>

ASSETS
Cash                                            $   1,112,918       $   681,234
Restricted Cash                                       567,111           382,394

Notes Receivable:
     Principal amount                              94,979,863        81,914,930
     Joint venture participations                    (493,707)         (492,086)
     Purchase discount                            (23,590,648)      (26,421,274)
     Allowance for loan losses                    (19,257,611)      (12,267,546)
                                                --------------      -----------
                                                   51,637,896        42,734,024

Accrued Interest Receivable                         1,713,115           932,450
Inventory, homes                                    2,517,881                 -
Inventory, automobiles                                342,452           390,498
Litigation Proceeds Receivable                        484,516           654,029
Due From Affiliate                                          -                 -
Deferred Tax Asset                                    240,227           278,978
Other Assets                                        2,007,167           855,854
Building, Furniture & Fixtures, net                   396,461           385,341
Loan Commitment Fees and Other, net                 1,522,333         1,530,463
                                                 -------------      -----------
                                                 $ 62,542,076      $ 48,825,265
                                                 =============      ===========

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:
     Accounts payable and accrued expenses       $  1,419,176      $    781,682
     Notes payable                                 51,320,800        39,186,371
     Convertible subordinated debentures              460,700           526,600
     Subordinated debentures                        1,200,000           575,000
     Notes payable, affiliates                        359,279           469,417
     Due to affiliates                                      -           232,075
     Income tax payable                                     -           163,336
     Deferred income tax credits                    1,324,759         1,337,590
     Lines of credit                                1,377,683                 -
                                                  -----------       -----------
          Total liabilities                        57,462,397        43,272,071

Minority Interest in Consolidated Partnerships      2,082,369         2,570,745

Redeemable Common Stock                                     -           487,000

Commitments and Contingencies
Stockholder's Equity:
     Common Stock, $.01 par value, 25,000,000 
     shares authorized, 5,503,897 and 5,247,871
     shares issued and outstanding in 1995 
     and 1994 respectively                             55,039            52,479
     Additional paid-in Capital                     6,326,376         5,838,941
     Retained Earnings (deficit)                   (3,384,105)       (3,395,971)
                                                  -----------       -----------
                                                    2,997,309         2,495,449
                                                  -----------       -----------
                                                 $ 62,542,076      $ 48,825,265
                                                  ===========       ===========

</TABLE>

                                                               2
<PAGE>

Item 1.  Financial Statements

FRANKLIN CREDIT MANAGEMENT CORPORATION AND AFFILIATES
(Formerly Miramar Resources, Inc.)

CONSOLIDATED STATEMENTS OF INCOME
Period ended September 30, 1995 and 1994      
<TABLE>
<CAPTION>

                                 Three Months Ended        Nine Months Ended
                               30-Sep-95    30-Sep-94    30-Sep-95   30-Sep-94
                              (unaudited)  (unaudited)  (unaudited) (unaudited)
<S>                               <C>          <C>          <C>         <C> 
Revenue:
  Interest Income              $2,028,514  $  728,895   $5,441,842  $2,274,582
  Purchase Discount Earned        948,353     387,175    2,922,782   1,309,115
  Oil & Gas                           736     131,998       57,894     360,220
  Gain (loss) on liquidation
     of partnership interests      (1,047)        314      (17,515)     45,616
  Gain (loss) on sale of 
     portfolios                    55,211           -       68,037           -
  Other Income                     62,937     (32,322)      97,973     (50,631)
                                ---------   ---------    ---------   ---------
                                3,094,704   1,216,060    8,571,013   3,938,902
                                ---------   ---------    ---------   ---------
Operating expenses:
  Oil & Gas                         1,116      65,636       15,084     195,790
  Depreciation, depletion
     and amortization             217,495     156,098      553,076     405,910
  Collection, general and 
     administrative               889,209     814,638    2,386,856   1,776,057
  Provision for loan losses       270,321      79,971      852,670     244,889
  Interest Expense              1,547,461     418,985    4,057,049   1,204,438
  Service Fees                    280,616           -      614,139           -
  Merger expenses                  18,959           -       93,844           -
                                ---------    --------    ---------   ---------
                                3,225,177   1,535,328    8,572,718   3,827,084
                                ---------   ---------    ---------   ---------
      Operating income (loss)    (130,473)   (319,268)      (1,705)    111,818
  Litigation proceeds                   -           -            -           -
                                ---------   ---------    ---------   ---------
                                 (130,473)   (319,268)      (1,705)    111,818
                                ---------   ---------    ---------   ---------
  Provision for income taxes      (21,352)   (139,048)      23,005      75,294
                                ---------   ---------    ---------   ---------
                                 (109,121)   (180,220)     (24,710)     36,524
  Minority interest in net
     income of consolidated
     partnerships                 (16,483)    (10,239)     (36,576)    (55,471)
                                ---------   ----------   ---------   ---------
       Net income              $  (92,638) $ (169,981)  $   11,866  $   91,995
                                =========   =========    =========   =========


Earnings per common share:
 Income before Minority 
   interest in net income
   of consolidated partnerships  $ (0.02)    $  (0.04)      $     -    $  0.01
  Minority interest in net
   income of consolidated
   partnerships                        -            -             -      (0.01)
                                  ------       ------        ------     ------
  Net income                       (0.02)       (0.04)         0.00       0.00
                                  ------       ------        ------     ------

Weighted average number 
   of shares outstanding         5,410,616   4,760,784     5,410,616  4,760,784
                                 =========   =========     =========  =========

</TABLE>

                                                               3

<PAGE>
Item 1.  Financial Statements

FRANKLIN CREDIT MANAGEMENT CORPORATION AND AFFILIATES
(Formerly Miramar Resources, Inc.)

CONSOLIDATED STATEMENT OF CASH FLOWS
Nine months ended September 30, 1995 and 1994
<TABLE>
<CAPTION>

                                                    (unaudited)     (unaudited)
                                                      9/30/95          9/30/94
<S>                                                     <C>              <C>
Cash Flows From Operating Activities
   Net income                                      $   11,866        $   91,995
    Adjustments to reconcile net income to net
       cash used in operating activities:
       Depreciation, depletion, amortization 
          and valuation provisions                    553,076           405,910
       Minority interests in net
          income of affiliates                        (36,576)          (55,471)
       Liquidation of partnership interests            17,515                 -
       (Gain) loss on sale of portfolios              (68,037)          (45,616)
       Purchase discount earned                    (2,922,782)       (1,309,115)
       Provision for loan losses                      852,670           244,889
       Deferred tax provision (benefit)                34,498                 -
       Changes in assets and liabilities:
          (Increase) decrease in:
            Accrued interest receivable              (786,861)         (282,476)
            Accounts receivable                       173,867           128,098
            Inventory-repossessions                (2,469,835)                -
            Other assets                           (1,138,497)         (258,187)
          Increase (decrease) in:
            Accounts payable and accrued
                expenses                              212,598           (61,937)
            Due to affiliates                        (167,796)          164,430
                                                    ---------        ----------
               Net cash used in operating 
                    activities                     (5,734,294)         (977,480)

Cash Flows From Investing Activities
    Purchase of property and equipment                (49,075)           (1,871)
    Proceeds from sale of properties                        -           350,981
    Purchase of notes receivable                  (19,040,914)       (8,830,000)
    Principal collections on notes receivable      12,256,132         5,371,079
    Joint venture participation                       (42,203)          (59,033)
    Additional paid in capital                          1,834                 -
    Acquisition fees paid                            (513,760)       (1,463,077)
    Increase in restricted cash                      (184,717)          (87,768)
                                                   ----------         ---------
              Net cash used in 
               investing activities                (7,572,703)       (4,719,689)

Cash Flows From Financing Activities
    Distributions to minority interests              (476,735)         (904,469)
    Contributions from minority interests                   -         1,239,500
    Capital contributions                                   -                 -
    Payments on debenture notes payable               (65,900)                -
    Proceeds from debenture notes                     625,000                 -
    Proceeds from long-term debt                   21,206,382        10,230,829
    Principal payments of long-term debt           (7,550,066)       (5,090,045)
                                                   ----------        ----------
              Net cash provided by 
                    financing activities           13,738,681         5,475,815
                                                   ----------        ----------
              Net increase (decrease) in cash         431,684          (221,354)
Cash:
    Beginning                                         681,234           675,477
                                                    ---------        ----------
    Ending                                        $ 1,112,918       $   454,123
                                                    =========        ==========
</TABLE>
<PAGE>

Item 1. Financial Statements

FRANKLIN CREDIT MANAGEMENT CORPORATION AND AFFILIATES
(Formerly Miramar Resources, Inc.)

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>

                                    Common Stock       Additional     Retained
                                 -----------------       Paid-In      Earnings
                                 Shares     Amount       Capital      (Deficit)
-------------------------------------------------------------------------------
<S>                                <C>        <C>         <C>           <C> 
Balance, December 31, 1994     5,247,871    $52,479   $5,838,941    $(3,395,971)
   Exercised subordinated
      debentures                 254,458      2,545      484,455
   Exercised Warrants              1,568         16        2,979

   Net income                                                            11,866
                               ------------------------------------------------
Balance, September 30, 1995    5,503,897    $55,039   $6,326,376    $(3,384,105)
                               ================================================

</TABLE>
                                        5


<PAGE>

FRANKLIN  CREDIT  MANAGEMENT   CORPORATION  AND  AFFILIATES   (Formerly  Miramar
Resources, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1. Nature of Business and Significant Accounting Policies

Nature of  business:  On  December  30,  1994,  all  shares of  Franklin  Credit
Management  Corporation  ("Franklin")  were  exchanged  for  shares  of  Miramar
Resources, Inc ("Miramar").  The newly formed entity was renamed Franklin Credit
Management Corporation ("Registrant").  Registrant,  incorporated under the laws
of the State of Delaware,  acquires loans and promissory notes from mortgage and
finance  companies as well as from the Resolution Trust Corporation (RTC) and/or
Federal Deposit Insurance  Corporation (FDIC).  Registrant purchases these loans
directly and through certain  affiliated  limited  partnerships and wholly owned
subsidiaries.  In  addition,  certain  stockholders  of the Company have limited
partnership  interests in these  partnerships.  Recurring  operating  income and
identifiable  assets attributable to these operations each constitutes more than
90%  of  the  related  combined  totals  for  all  of  Registrant's  operations.
Registrant follows accounting  principles similar to those of a consumer finance
company.

During  1994,  Miramar held  interests  in certain gas and oil wells  located in
Colorado, Kansas and Oklahoma. These interests were sold in December 1994 at the
time of the  merger.  The  proceeds  of the sale were  utilized  in the  ongoing
business of the Registrant.

A summary of Registrant's significant accounting policies follows:

Basis of  consolidation:  The  consolidated  financial  statements  include  the
accounts of Registrant,  its wholly-owned  subsidiaries,  Rockwell Drilling Co.,
Harrison  Financial   Corporation,   Harrison  First  Corporation,   6  Harrison
Corporation  and all  limited  partnerships  controlled  by  Franklin as General
Partner.  By terms outlined in the various partnership  agreements,  Franklin is
specifically  afforded full power and authority on behalf of the partnerships to
manage,  control,  administer  and  operate  the  business  and  affairs  of the
partnerships.  All significant  intercompany accounts and transactions have been
eliminated in consolidation. These consolidated financial statements include the
following entities:

Rockwell Drilling Co.
Franklin Credit Management Corporation (FCMC)
Franklin Credit Recovery Fund, L.P. (Fund I)
Franklin Credit Recovery Fund II, L.P. (Fund II)
Franklin Credit Recovery Fund III, L.P. (Fund III)
Franklin Credit Recovery Fund IV, L.P. (Fund IV)
Franklin Credit Recovery Fund V, L.P. (Fund V)
Franklin Credit Recovery Fund VI, L.P. (Fund VI)
Franklin Credit Recovery Fund VII, L.P. (Fund VII)
Franklin Credit Recovery Fund VIII, L.P. (Fund VIII)
Franklin Credit Recovery Fund IX, L.P. (Fund IX)
Franklin Credit Recovery Fund X, L.P. (Fund X)
Franklin Credit Recovery Fund XI, L.P. (Fund XI)
Franklin Credit Recovery Fund XII, L.P. (Fund XII)
Franklin Credit Recovery Fund XIII, L.P. (Fund XIII)
Franklin Credit Recovery Fund XIV, L.P. (Fund XIV)
Franklin Credit Recovery Fund XVI, L.P. (Fund XVI)
Franklin Credit Recovery Fund XVII, L.P. (Fund XVII)
Franklin Credit Recovery Fund XVIII, L.P. (Fund XVIII)
Franklin Credit Recovery Fund XIX, L.P. (Fund XIX)
Franklin Credit Recovery Fund XX, L.P. (Fund XX)
Franklin Credit Recovery Fund XXI, L.P. (Fund XXI)
Franklin Credit Recovery Fund XXII, L.P. (Fund XXII)
Franklin Credit Recovery Fund XXIII, L.P. (Fund XXIII)
Harrison Financial Corporation (Harrison Financial)
Harrison First Corporation (Harrison 1st)
6 Harrison Corporation (6 Harrison)
                                             6



<PAGE>




FRANKLIN  CREDIT  MANAGEMENT   CORPORATION  AND  AFFILIATES   (Formerly  Miramar
Resources, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Cash:  For  purposes of  reporting  cash  flows,  Registrant  includes  all cash
accounts (excluding restricted cash) and money market accounts held at financial
institutions.

Loans and income  recognition:  The loan portfolio consists primarily of secured
consumer  oriented loans purchased from the RTC and FDIC as well as from finance
and mortgage companies which are usually purchased at a substantial discount.

Loans are stated at the amount of unpaid principal, reduced by purchase discount
and an allowance for loan loss. In general,  interest on the loans is calculated
by using the  simple-interest  method on daily  balances  of what is deemed  the
collectible principal amount outstanding.

Accrual of interest is discontinued on a loan when  management  believes,  after
considering  current and  possible  future  collection  efforts,  as well as the
borrowers' financial condition that collection of interest is doubtful.

Purchase discount is amortized to income using the interest method. The interest
method  recognizes  income based on the projected  cash flows from loans using a
constant  effective  yield on the net  investment  in the loans.  Discounts  are
amortized if the projected payments are probable of collection and the timing of
such collections is reasonably estimable.  Changes in the projected payments are
accounted  for as a change in estimate  and  prospectively  adjust the  periodic
amortization of remaining discount over the remaining life of the loans.  Should
projected  payments  not exceed the  carrying  value of the loan,  the  periodic
amortization  is  suspended  and either the loan is written down or an allowance
for uncollectibility is recognized.

Allowance  for  loan  losses:   The  allowance  for  loan  losses  is  initially
established  by  an  allocation  of  the  acquisition  discount.   Subsequently,
increases to the allowance are made through a provision for loan losses  charged
to expense.  Loans are charged  against the allowance when  management  believes
that the principal is uncollectible.  Franklin's charge-off policy is based upon
a loan-by-loan review for all portfolios.

The allowance is an amount that  management  believes will be adequate to absorb
possible  losses on  existing  loans  that may  become  uncollectible,  based on
evaluations of the  collectibilty  of the loans and prior loan loss  experience.
The evaluations  take into  consideration  such factors as changes in the nature
and volume of the loan portfolio,  overall portfolio quality, review of specific
problem loans,  and current  economic  conditions that may affect the borrower's
ability to pay.

Building, property and equipment:  Building, property and equipment are recorded
at cost.  Depreciation  is  computed  using the  straight-line  method  over the
estimated useful lives of the assets.

Loan  commitment  fees: Loan  commitment  fees represent loan  origination  fees
incurred by the Company in connection with obtaining financing and are amortized
based on the principal reduction of the related loans.

Oil and gas properties:  Miramar  followed the full cost method of accounting as
defined by the Securities and Exchange Commission, whereby all costs incurred in
connection  with the  acquisition,  exploration  and  development of oil and gas
properties   were   capitalized.   These   costs   were   amortized   using  the
unit-of-production method. Miramar's depreciation,  depletion,  amortization and
valuation  provision  rate per  barrel of oil  produced  during  1994 was $2.93.
During  1994,  the Company sold its interest in all wells and realized a gain of
approximately $57,000 on the transaction.

Deferred  income taxes:  Deferred taxes are provided using the liability  method
whereby deferred tax assets are recognized for deductible temporary  differences
and operating loss or tax credit  carryforwards and deferred tax liabilities are
recognized for taxable  temporary  differences.  Temporary  differences  are the
differences  between the amounts of assets and  liabilities  recorded for income
tax purposes and financial reporting  purposes.  Deferred tax assets are reduced
by a valuation allowance when management  determines that it is more likely than
not that some  portion or all of the  deferred  tax assets will not be realized.
Deferred tax assets and  liabilities  are adjusted for the effects of changes in
tax laws and rates on the date of enactment.




                                             7



<PAGE>



FRANKLIN  CREDIT  MANAGEMENT   CORPORATION  AND  AFFILIATES   (Formerly  Miramar
Resources, Inc.)


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Earnings per common share: Earnings per share are computed based on the weighted
average number of common shares  outstanding  during the period and includes the
effect of redeemable common stock and outstanding warrants.  Unexercised options
under the conversion  feature of the debenture are deemed not to be common stock
equivalents.  Earnings per common share has been restated for the effects of the
merger.

Emerging accounting  standards:  The Financial Accounting Standards Board (FASB)
has issued SFAS No. 107, Disclosures About Fair Value of Financial  Instruments,
which requires disclosure of fair value information about financial instruments,
whether or not recognized on the balance  sheet,  for which it is practicable to
estimate that value. SFAS No. 107 excludes certain financial instruments and all
nonfinancial  instruments  from its disclosure  requirements.  This statement is
effective  for the  Registrant's  year ending  December 31,  1995,  to which the
Registrant anticipates no material effect.

The FASB has issued Statement No. 114, Accounting by Creditors for Impairment of
a Loan.  SFAS No. 114 requires that impaired  loans that are within the scope of
the  Statement be measured  based on the present  value of expected  future cash
flows  discounted  at the  loans'  effective  interest  rate  or as a  practical
expedient,  at the  loan's  observable  market  price or the  fair  value of the
collateral.  A loan is impaired  when it is probable the creditor will be unable
to collect all contractual principal and interest payment due in accordance with
the terms of the loan  agreement.  This Statement is effective for  Registrant's
year ending December 31, 1995. Registrant has not addressed the potential future
impact of the application of the Statement.

The FASB  issued SFAS No. 118,  Accounting  by  Creditors  for  Impairment  of a
Loan-Income  Recognition  and  Disclosure  which amends SFAS No. 114, to allow a
creditor to use existing methods for recognizing  interest income on an impaired
loan by  eliminating  the  provisions in SFAS 114 that  described how a creditor
should  report  income  on an  impaired  loan.  It also  amends  the  disclosure
requirements  in  SFAS  No.  114  to  require  information  about  the  recorded
investment  in certain  impaired  loans and how a creditor  recognizes  interest
income related to those loans.  This Statement is effective  concurrent with the
effective date of SFAS No. 114.

Accounting Change and Income Tax Matters:  Prior to the Merger,  Franklin,  with
the consent of their  stockholders,  elected to be taxed  under  sections of the
federal and Virginia income tax laws (S Corporation status), which provide that,
in lieu of corporation  income taxes,  the stockholders  separately  account for
their pro rata  shares of  Franklin's  items of income,  deductions,  losses and
credits.  On July 1, 1994 Franklin terminated its election to be treated as an S
Corporation.

As a result of the July 1, 1994  termination,  Franklin  recorded a net deferred
tax liability of  approximately  $736,000,  for the period of inception  through
July 1,  1994,  by a charge to income  tax  expense  for  temporary  differences
between  the  financial  reporting  and  the  income  tax  basis  of  discounts,
allowances, receivables, and other assets.

Effective  January 1, 1993 Franklin  adopted FASB Statement No. 109,  Accounting
for income Taxes. The adoption of Statement No. 109 changed Franklin's method of
accounting  for  accounting  for income  taxes from the  deferred  method to the
liability  method.  Under the deferred  method,  Franklin  deferred the past tax
effects of timing  differences  between financial  reporting and taxable income.
The  liability  method  requires  the  recognition  of  deferred  tax assets and
liabilities  for the expected future tax  consequences of temporary  differences
between the reported amounts of assets and liabilities and their tax basis.

                                             8


<PAGE>



                             PART I  -  FINANCIAL INFORMATION

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

Three Months Ended September 30, 1995 Compared to Three Months Ended September
          30, 1994

      The   Registrant   is  in  the  business  of  acquiring   performing   and
non-performing consumer loan portfolios from various financial institutions.  In
late  1994,  the  Registrant  acquired  two  consumer  loan  portfolios  with an
aggregate principal balance of approximately  $40,000,000.  In May and September
of 1995 the  Registrant  acquired  three  additional  consumer  loan  portfolios
totaling approximately $30,800,000.  These portfolios were acquired through term
debt facilities from financial institutions (the "Senior Debt") of approximately
$24,000,000 and $19,044,000, respectively.

      The  Registrant  believes  these  acquisitions  will result in substantial
increases in interest  income and purchase  discount  income for future periods.
Historically  however,  during the initial period  following  acquisitions,  the
Registrant  incurs  significant  administrative  carrying costs as these 
portfolios are incorporated  into the Company's  proprietary loan tracking
system and contact with the borrowers  begins to produce monthly cash flows that
will be  utilized  to service  the Senior  Debt.  Accordingly,  during the three
months ended  September  30, 1995,  Registrant  recognized a net loss of $92,638
comparable  to a net loss of $169,981 for the same period in 1994.  The loss can
be greatly  attributed to a $1,128,476 or 269% increase in interest expense from
$418,985 at September 30, 1994 to $1,547,461 at September 30, 1995 reflective of
the additional Senior Debt borrowed to acquire these new portfolios.

      On May 9, 1995 Franklin purchased a non-performing consumer loan portfolio
with a principal  balance of $2,438,416 for an  acquisition  cost of $1,238,500.
The portfolio was secured by condominiums  and co-op  apartments in the New York
Metropolitan Area.

      On May 10 and May 11,  1995  Franklin  was the  successful  bidder  on 355
predominately  performing  consumer loans with an aggregate principal balance of
$22,769,747 for the  acquisition  cost of $15,270,000 at the RTC's National Loan
Auction VII. These loans are primary  secured by first  mortgages,  located on a
nationwide basis. The closing occurred on May 25, 1995.

      On August 17, 1995 Franklin was the successful  bidder on 83 predominately
non-performing  consumer loans with an aggregate principal balance of $5,622,881
for the acquisition cost of $2,535,919 at the FDIC Loan Auction. These loans are
primary secured by second mortgages, located in the New York Metropolitan Area.
The closing occurred on September 13, 1995.

      In  addition,  during  the third  quarter  of 1995,  Registrant  returned,
pursuant to its purchase agreement with the RTC,  $3,851,106 of notes receivable
previously  acquired from the RTC during 1994. These notes had legal or document
deficiencies at the time of purchase by FCMC.  Registrant has recorded, in other
assets,  approximately  $1,498,482  which represents the purchase price of these
acquired loans.  Upon review and approval the purchase price of these loans will
be  reimbursed to  Registrant  by the RTC without  earning any  interest,  while
Registrant  incurs  interest  expense  with  respect to the Senior  Debt used to
acquire  these  loans.  Management  believes  that  the  failure  of the  RTC to
reimburse the registrant would not have a material effect upon the operations of
the  Company,  due to the fact that the impact would be reflected as a reduction
in the overall purchase discount to be earned over the life of the portfolios.

      Registrant recognizes interest income on Notes Receivable based upon three
factors;  (i) interest  upon  performing  notes,  (ii)  interest  received  with
payments  upon  non-performing  notes and (iii) the  balance of  settlements  in
excess  of  principal  repayments.   Revenues  from  interest  income  on  Notes
Receivable  increased  $1,299,619,  or 178%,  from  $728,895 in the three months
ended September 30, 1994 to $2,028,514 for the same period in 1995. The increase
in interest  income was  principally  due to a 154%  increase in net  performing
Notes  Receivable  from  $20,344,886  at September  30, 1994 to  $51,647,033  at
September 30, 1995.

      Purchase discount income increased  $561,178 or 145%, from $387,175 in the
three months ended  September  30, 1994 to $948,353 for the same period in 1995.
The increase in Purchase  Discount  income  recognized  reflects  the  increased
volume of Notes Receivable.



                                             9




<PAGE>





      Revenues  related  to oil and gas  sales  declined  $131,262  or 99%  from
$131,998 in three months ended September 30, 1994 to $736 for the same period in
1995.  The sale on December 30, 1994, of the oil and gas interests  accounts for
the wide variances  related to all oil and gas related income and expenses.  The
revenue  reflected  in the third  quarter of 1995,  relates  to a joint  venture
interest,  which  was not  sold on  December  30,  1994.  Oil and gas  operating
expenses  decreased  $64,520  or 98% from  $65,636  in the  three  months  ended
September 30, 1994 to $1,116 for the same period in 1995.

      The  Registrant  had  a  $51,738,800  or  120%  increase  in  gross  Notes
Receivable  from  $43,241,063  at September 30, 1994 to $94,979,863 at September
30,  1995.  In  view of this  significant  increase  in  Notes  Receivable,  the
collection,  general and  administrative  expenses  increased $74,571 or 9% from
$814,638 for the three months ending September 30, 1994 to $889,209 for the same
period in 1995. The increase can be attributed to additional  personnel required
to service the Notes Receivable.

      Bad debt  expense  increased  $190,350 or 238% from  $79,971 for the three
months ended  September  30, 1994 to $270,321  for the same period in 1995.  The
increase  in bad debt  expense  was  primarily  due to the charge off of several
loans in connection with borrower bankruptcies.

      Interest expense increased  $1,128,476 or 269%, from $418,985 in the three
months ended  September 30, 1994 to $1,547,461  for the same period in 1995. The
increase was  principally  due to an increase in notes payable of $33,850,303 or
195%,  from  $17,329,776  at September 30, 1994 to  $51,180,079 at September 30,
1995,  reflecting  additional  funds borrowed to acquire Loan  Portfolios and an
increase in the  interest  rate  charged on borrowed  funds.  The notes  payable
accrue interest at variable rates based upon the prime rate.

      Service fees increased $280,616 or 100% due to no corresponding expense in
1994.  Registrant  incurred the service fees under agreements with a Senior Debt
Lender with  respect to five of the Limited  Partnerships  and its wholly  owned
subsidiaries formed in the later part of 1994 and 1995.

      Merger related expenses  increased $18,959 or 100% due to no corresponding
expense in 1994.  The Merger was  consummated  on  December  30, 1994 and had no
related  expenses  during the three months ended  September  30, 1994.  The fees
incurred  during  1995  related to  expenses  incurred  in  connection  with the
issuance of new stock  certificates  for Registrants  Common Stock in connection
with the Merger and public filings.

      Net losses before taxes and minority interest  decreased 68% from $409,732
in the three months ended  September 30, 1994 to $130,472 for the same period in
1995.  Net losses  decreased  46% from a  $169,981  for the three  months  ended
September 30, 1994 to $92,638 for the same period in 1995.


Nine Months Ended September 30, 1995 Compared to Nine Months Ended
September 30, 1994

      As reflected  in the three month  analysis,  Registrant  acquired six loan
portfolios with an aggregate  principal balance of approximately  $75,000,000 in
late 1994 and 1995. These  acquisitions were funded through Senior Debt provided
to the  Registrant in the aggregate  amount of  approximately  $43,310,000.  The
Registrant incurs significant administrative carrying costs while these 
portfolios are classified as to performance status and incorporated into the
Company's proprietary loan tracking system. Interest expense incurred during
this process,primarily as a result of the Senior Debt associated with these new
portfolios increased $2,852,611 or 237% from $1,204,438 for the nine months
ended September 30, 1994 to $4,057,049 for the same period in 1995. Accordingly,
Registrant recognized a decline in net income of 87% from a $91,995 net income
for the nine months ending  September 30, 1994 to a net income of $11,866 for
the same period in 1995. Management believes however that the recently acquired 
loan portfolios will significantly increase income and purchase discount income
in future periods.

      Revenues from interest income on Notes Receivable  increased $3,167,260 or
139%,  from $2,274,582 in the nine months ended September 30, 1994 to $5,441,842
for the same period in 1995. The increase in interest income was principally due
to the increase in Notes Receivable as noted above.


                                            10



<PAGE>




      Purchase discount income increased  $1,613,667 or 123%, from $1,309,115 in
the nine months ended  September 30, 1994 to  $2,922,782  for the same period in
1995. The increase in Purchase  Discount income reflects the increased volume of
Notes Receivable as well as with the reclassification of certain  non-performing
loans who have been brought to performing status.

      Revenues  related  to oil and gas  sales  declined  $302,326  or 84%  from
$360,220 in nine months ended  September 30, 1994 to $57,894 for the same period
in 1995. The revenue reflected in the third quarter of 1995,  relates to a joint
venture interest, which was not sold on December 30, 1994. Oil and gas operating
expenses  decreased  $180,706  or 92% from  $195,790  in the nine  months  ended
September 30, 1994 to $15,084 for the same period in 1995.

      Depreciation,  depletion and amortization  expenses  increased $147,166 or
36% from  $405,910 in the nine months ended  September  30, 1994 to $553,076 for
the same  period  in 1995  also  reflective  of the  increased  volume  of Notes
Receivable.

      The  Registrant  had  a  $51,738,800  or  120%  increase  in  gross  Notes
Receivable  from  $43,241,063  at September 30, 1994 to $94,979,863 at September
30,  1995.  In  view of this  significant  increase  in  Notes  Receivable,  the
collection,  general and administrative  expenses increased $610,799 or 34% from
$1,776,057  for the nine months ending  September 30, 1994 to $2,386,856 for the
same period in 1995.  The  majority of this  increase,  $392,458 or 72%,  can be
attributed to  additional  personnel  required to service the Notes  Receivable.
Personnel expenses increased  $392,458,  from $545,794 for the nine months ended
September 30, 1994 to $938,252 for the same period in 1995. All other collection
expenses   increased   $218,341,   reflecting  the  costs  associated  with  the
significant  increase in Notes Receivable.  However,  when analyzing the general
and administrative  expenses as a percentage of the total revenue they result in
an actual  decrease of 17% from 45% of total  revenue for the nine months  ended
September 30, 1994 to 28% for the same period in 1995.

      Bad debt  expense  increased  $607,781 or 248% from  $244,889 for the nine
months ended  September  30, 1994 to $852,670  for the same period in 1995.  The
increase  in bad debt  expense  was  primarily  due to the charge off of several
loans in connection with borrower bankruptcies.

      Interest expense increased $2,852,611 or 237%, from $1,204,438 in the nine
months ended  September 30, 1994 to $4,057,049  for the same period in 1995. The
increase was principally due to an increase in notes payable as noted above.

      Service fees increased $614,139 or 100% due to no corresponding expense in
1994.  Registrant  incurred the service fees under agreements with a Senior Debt
Lender with  respect to five of the Limited  Partnerships  and its wholly  owned
subsidiaries formed in the later part of 1994 and during 1995.

      Merger related expenses  increased $93,844 or 100% due to no corresponding
expense in 1994. The Merger was  consummated on December 30, 1994 and there were
no related expenses during the nine months ended September 30, 1994.

      Income before taxes and minority interest  decreased 102% from $118,818 in
the nine months ended  September 30, 1994 to $1,705 for the same period in 1995.
Net income  decreased 87% from a $91,995 for the nine months ended September 30,
1994 to $11,866 for the same period in 1995.


Liquidity and Capital Resources

      At September 30, 1995, the Company had cash of $1,112,918,  a net increase
of $431,684 from  December 31, 1994.  During 1994,  Registrant  used cash in the
amount of $5,734,294 in its operating activities and $7,572,703 in its investing
activities.  The amount of cash used in operating and investing  activities  was
funded by $13,738,681 of net cash provided by financing activities.

      In the later part of 1994, Franklin had completed the acquisition of three
non-performing  consumer loan portfolios with an aggregate  principal balance of
approximately $63.2 million secured by first and second mortgages. In the normal
course of  business,  Franklin  began  foreclosure  actions on a number of these
loans in late  1994.  Accordingly,  Franklin  held no homes as  inventory  as of
December 31, 1994. At September 30, 1995, however, Registrant held as inventory,
homes having a net realizable  value of $2,517,881,  which were obtained through
these foreclosures. Management believes these homes will be sold in the ordinary
course of business and that the increase in homes held as inventory at September
30, 1995 is not  material  to the  operations  of the  Company.  Registrant  has
recorded these homes at the lower of cost or market value.

                                            11
      At September 30, 1995,  Registrant held as inventory  automobiles having a
net realizable value of $342,452 which it obtained through  repossessions in the
normal course of business.  Franklin held as inventory automobiles having a fair
market


<PAGE>



value of $390,498 as of December 31, 1994. The decrease in  automobiles  held as
inventory at September 30, 1995 is a result of reduced repossession and improved
collection efforts.  Registrant has recorded these autos at the lower of cost or
market value.

      Management  believes  that  Registrant's  existing cash  balances,  credit
lines, and anticipated cash flow from operations will provide sufficient capital
resources for its currently anticipated operating needs.


Cash Flow From Operating and Investing Activities

      Substantially  all of the  assets  of  Registrant  are  invested  in Notes
Receivable owned by the Limited  Partnerships and its wholly owned subsidiaries.
The  Company's  primary  source of cash flow from  operations  is  distributions
related to its ownership interests in the Limited  Partnerships and subsidiaries
and fees earned for servicing the Loan Portfolios owned by these entities.

      Due to the  restrictions  placed on Registrant's  use of collections  from
Notes  Receivable  imposed by the Senior Debt lenders,  which  restrictions  are
described below in Cash Flow From Financing Activities,  Registrant  experiences
periods of irregular cash flow  shortages.  Management  believes that Registrant
has sufficient  cash flow to pay current  liabilities  arising from  operations.
Management  also believes that sufficient cash flow from the collection of Notes
Receivable will be available to repay Registrant's  secured obligations and that
sufficient  additional  cash  flows will  exist,  through  collections  of Notes
Receivable,  the sale of Loan  Portfolios,  modifications  to the  secured  debt
credit  agreements  or  additional  borrowings,  to  repay  the  obligations  of
Registrant.  Registrant has no commitments for capital expenditures.  Except for
management's  intent to acquire  additional Loan  Portfolios,  Registrant is not
aware  of any  trends  or  operations  that  would  cause  Registrant  to  incur
additional capital expenditures in the future.


Cash Flow From Financing Activities

      Senior  Debt.  As of  September  30, 1995,  the Limited  Partnerships  and
affiliated  wholly owned  subsidiaries had twelve loans payable to two financial
institutions,  in the aggregate amount of $51,180,079. The twelve loans obtained
by the Limited  Partnerships  and the affiliated  wholly owned  subsidiaries are
collectively referred to as the Senior Debt.

      The Senior Debt is  collateralized  by first liens on the respective  Loan
Portfolios for which the debt was incurred and is guaranteed by the Company. The
monthly  payments  on the Senior  Debt have been,  and it is  intended  that the
payments will continue to be, met by the  collections  from the respective  Loan
Portfolios.  The loan  agreements for the Senior Debt call for minimum  interest
and  principal  payments due each month and  accelerated  payments  based on the
collection of the Notes  Receivable  securing the debt. The accelerated  payment
provisions are generally of two types:  the first requires that all  collections
from  Notes  Receivable,  other than a fixed  monthly  allowance  for  servicing
operations,  be applied to reduce the Senior Debt,  and the second  requires the
Company to maintain a fixed ratio of the  aggregate  amount of Notes  Receivable
compared  to the  outstanding  amount  of the  Senior  Debt.  As a result of the
accelerated payment  provisions,  the Company is repaying the amounts due on the
Senior Debt at a rate faster than the minimum scheduled payments. However, while
the Senior Debt remains outstanding,  these accelerated payment provisions limit
the amount of cash flow  which is  available  to the  Limited  Partnerships  and
subsidiaries to distribute to their partners including the Company.

      Eight of the Senior Debt credit  agreements  require  that a  non-interest
bearing  cash  account  be  established  as a "Bad Debt  Reserve",  funded by an
initial  deposit  at the loan  closing  and  additional  deposits  based  upon a
percentage of monthly  collections up to a specified  dollar limit. The Bad Debt
Reserves  are  maintained  at a bank  which is one of the  lenders of the Senior
Debt. The use of the cash in the Bad Debt Reserves is restricted by the terms of
the credit  agreements and is to be utilized only upon the Company's  failure to
meet the  minimum  monthly  payment  due if  collection  from  Notes  Receivable
securing the loan is insufficient to satisfy the installment due.  Historically,
the Company has not had to call upon these  reserves.  The aggregate  balance of
restricted cash in such accounts was $588,676 at September 30, 1995 and $382,394
at December 31, 1994.




                                            12



<PAGE>




      12% Debentures. In October 1994, Franklin made a private offering of up to
$750,000 of 12%  Debentures  (the "12%  Debentures").  The 12%  Debentures  bear
interest at the rate of 12% per annum and are payable  quarterly on the last day
of each calendar quarter  commencing  December 31, 1994. The principal amount is
payable over four years in 16 equal quarterly  payments beginning with a payment
due March 31, 1996,  with the entire  balance due on December 31, 1999.  The 12%
Debentures are secured by a lien  subordinate to the Senior Debt encumbering the
Loan  Portfolio  acquired at the RTC National  Auction in September  1994. As of
September  30,  1995,  12%  Debentures  having a face  value of  $725,000,  were
subscribed  to and accepted by  Registrant.  The proceeds of this  offering were
used to pay costs  associated  with the  acquisition  of the Loan  Portfolio  in
September 1994,  including  repayment of amounts advanced by  stockholders,  the
cost  of  servicing  existing  Loan  Portfolios  and  general  working  capital.
Approximately  $400,000  of the  proceeds  of the 12%  Debentures  were used for
general working capital.

      Lines of Credit. Advances made available to the Company by its Senior Debt
lender were used to satisfy senior lien positions and fund property repair costs
in connection  with  foreclosures  of certain real estate loans  financed by the
Company.  Management believes the ultimate sale of these properties will satisfy
the  outstanding  lines of credit and accrued  interest,  as well as surpass the
collectable  value of the original secured note receivable.  Advances during the
period ended September 30, 1995, total $1,377,683.

      Limited Partnerships. Franklin is the general partner of seventeen limited
partnerships  which were active  during 1995.  The limited  partnerships  obtain
capital to purchase Loan Portfolios  primarily from one, or a combination of the
following  sources:  (i) equity  contributions  or loans from  Franklin  and its
stockholders,  (ii) the sale of limited  partnership  interests to third parties
and (iii)  loans from banks or finance  companies  (which is  referred to as the
Senior Debt).

      Management  plans to  continue  to use bank  financing,  credit  lines and
private sources of equity to fund future Loan Portfolio  acquisitions.  However,
management  intends to attempt to finance the  acquisitions  of Loan  Portfolios
with  debt  from  financial  institutions,  rather  than from the sale of equity
interests to limited partners.  Management  believes that Registrant can acquire
debt from financial  institutions  on more favorable  terms than can be obtained
from individuals investing in limited partnerships.

      On May 5, 1995 Franklin was authorized by the U.S. Department of Education
and the New York State  Higher  Education  Services  Corporation  to  originate,
purchase,  hold and transfer U.S. and New York State  guaranteed  Student Loans.
Franklin may utilize this designation for possible future student loan portfolio
acquisition.



















                                            13






<PAGE>







                                        SIGNATURES

      In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

November 15, 1995               FRANKLIN CREDIT MANAGEMENT
                                CORPORATION



                                 By:   FRANK B. EVANS
                                       Frank B. Evans
                                       Vice President,Chief Financial Officer
                                          and Director



























                                            14