1
                                                                    Exhibit 23.1


                        CONSENT OF INDEPENDENT AUDITORS


        We consent to the reference to our firm under the caption "Experts" in
Amendment No. 1 to Registration Statement (Form S-3 No. 333-37963) and related
Prospectus of Litchfield Financial Corporation for the registration of
$51,750,000 Notes payable and to the incorporation by reference therein of our
report dated January 31, 1997, with respect to the consolidated financial
statements of Litchfield Financial Corporation incorporated by reference in its
Annual Report (Form 10-K) for the year ended December 31, 1996, filed with the
Securities and Exchange Commission.

         
                           



                                                  ERNST & YOUNG LLP

Boston, Massachusetts
October 22, 1997