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                                                                    EXHIBIT 99.0





                            THE GLENWOOD APARTMENTS

                             STATEMENT OF REVENUES
                         AND DIRECT OPERATING EXPENSES
                           Year Ended August 31, 1996





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                          Independent Auditors' Report




To the Board of Trustees
Continental Mortgage and Equity Trust

We have audited the accompanying statement of revenues and direct operating
expenses of The Glenwood Apartments for the year ended August 31, 1996.  This
statement of revenues and direct operating expenses is the responsibility of
the Property's management.  Our responsibility is to express an opinion on this
statement of revenues and direct operating expenses based on our audit.

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

The accompanying financial statement is prepared for the purpose of complying
with the rules and regulations of the Securities and Exchange Commission (for
inclusion in Form 8-K of Continental Mortgage and Equity Trust) and, as
described in Note 1, is not intended to be a complete presentation of the
results of operations.

In our opinion, the statement of revenues and direct operating expenses
referred to above presents fairly, in all material respects, the revenues and
direct operating expenses of The Glenwood Apartments for the year ended August
31, 1996, in conformity with generally accepted accounting principles.



                                            FARMER, FUQUA, HUNT & MUNSELLE, P.C.

Dallas, Texas
December 30, 1996





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                            THE GLENWOOD APARTMENTS
                             STATEMENT OF REVENUES
                         AND DIRECT OPERATING EXPENSES
                           Year Ended August 31, 1996




                                                                 
REVENUES
         Net rental revenues                                        $      947,995
         Other                                                             131,716
                                                                    --------------
                 Total revenues                                          1,079,711
                                                   
OPERATING EXPENSES                                 
         Salaries and benefits                                             127,902
         Property taxes                                                     94,844
         Utilities                                                         236,966
         Repairs and maintenance                                            71,742
         Insurance                                                          21,592
                                                                    --------------
                 Total direct operating expenses                           553,046
                                                                    --------------
REVENUES IN EXCESS OF DIRECT OPERATING EXPENSES                     $      526,665
                                                                    ==============






         The accompanying notes are an integral part of this statement.





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                            THE GLENWOOD APARTMENTS
                         NOTES TO STATEMENT OF REVENUES
                         AND DIRECT OPERATING EXPENSES
                                August 31, 1996

NOTE 1:  ORGANIZATION AND BASIS OF PRESENTATION
         
         The Glenwood Apartments is a 168 unit apartment complex,
         located in Dallas, Texas.  During 1996, the property was owned
         by VRRM, Inc.
         
         The accompanying financial statement does not include a
         provision for depreciation and amortization, bad debt expense,
         interest expense or income taxes.  Accordingly, this statement
         is not intended to be a complete presentation of the results
         of operations.

NOTE 2:  ACCOUNTING ESTIMATES

         The preparation of financial statements in conformity with
         generally accepted accounting principles requires management
         to make estimates and assumptions that affect the reported
         amounts of revenues and expenses during the reporting period.
         Actual results could differ from those estimates.

NOTE 3:  SUBSEQUENT EVENT

         The property was sold to Continental Mortgage and Equity
         Trust, a California business trust, on November 5, 1996.





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