September 16, 2005

Mail Stop 4561

By U.S. Mail and facsimile to (201)567-2203

Mitchell Cohen
Chief Financial Officer
Asta Funding, Inc.
210 Sylvan Ave.
Englewood Cliffs, New Jersey 07632


Re:	Asta Funding, Inc.
	Form 10-K filed December 14, 2004
	File No. 0-26906

Dear Mr. Cohen:

	We have reviewed your filing and have the following comments.
Where indicated, we think you should revise your document in
response
to these comments.  If you disagree, we will consider your
explanation as to why our comment is inapplicable or a revision is
unnecessary.  Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us with
supplemental information so we may better understand your
disclosure.
After reviewing this information, we may or may not raise
additional
comments.

      Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or any other aspect
of
our review.  Feel free to call us at the telephone numbers listed
at
the end of this letter.

Form 10-K for the period ended September 30, 2004

Item 1, Description of Business, page 3

Consumer Receivables Business,  Receivables Purchase Program, page
5

1. We refer to the second paragraph on page 6 that states you have
entered into joint ventures and participation and profit sharing
agreements with your financial and service providers, as part of
your
strategy to acquire consumer receivable portfolios. In this
regard,
please tell us and provide us in future filings with the following
information:



* describe the terms of the joint ventures that you have entered
into
and provide the disclosures required by paragraph 20 of APB 18, as
amended by paragraph 15.e of SFAS 94;

* state the gains or losses recorded on your equity investments in
joint ventures and disclose where they are recorded in the income
statement;

* describe the terms of any material current and future funding
requirements and discuss in MD&A their effects on your current and
future cash flows and liquidity;

* state the duration and terms of the profit sharing agreements,
including the conditions for revenue sharing and cost allocation.

2. We refer to the penultimate paragraph on page 7 that states you
can return certain accounts to the seller.  In this regard, please
tell us and disclose in future filings:

* the conditions, including any contractual maximum amount of
loans
and time period under which you can return these accounts to the
seller;

* if material, state the total dollar amount of loans you have
returned to the seller for each fiscal period or that have been
replaced with other receivables.

Portfolio Sales, page 10.

3. We refer to the statement that you sell certain receivables to
other debt buyers to increase revenue and cash flows.  In this
regard, please tell us and in future filings provide the following
information:

* describe the revenue recognition policies with respect to sale
of
receivables, including your consideration of paragraph 11.c of
SFAS
140 with respect to recording recourse obligations on loans sold
on a
recourse basis;

* disclose the nature and total dollar amount of receivables sold
during the last two fiscal years and the total gain or loss on
sale
of receivables for each period;

* state in what line item of the Consolidated Statement of
Operations
on page F-4 you have included the gain or loss on these sales;

* disclose in the Consolidated Statement of Cash Flows on page F-6
the cash flows that have resulted from the sale of these
receivables
and the adjustment to reconcile net income to net cash provided by
operating activities.


Other Activities, page 11

4. We refer to the forbearance agreement entered into with SBR in
April 2002 in connection with the loans the Company provided to
SBR.
Considering you wrote off your entire investment in 2001, please
tell
us and in future filings disclose:

* the business reasons for entering into a forbearance agreement
in
2002 with respect to the loans provided to SBR;

* the conditions of the forbearance and warrant agreements with
SBR,
including any contingencies or funding commitments retained by the
Company.

Risk Factors, page 13

5. We refer to the risk factor on page 15 titled "We are dependent
upon third parties to service a majority of our consumer
receivable
portfolios".  Please reconcile the statement that you outsource a
majority of your receivable servicing with the following
statements
in MD&A by telling us how they are applicable or consistent with
page
15:

* the "Third-Party Servicing Revenues" section on page 29 states
you
recorded in 2004 a 76.3% decrease in third party servicing
expenses
as compared to 2003 due to the elimination of accounts being
serviced
by third parties during 2004;

* the "Revenues" section on page 28 states management decided in
2004
to implement a greater collection effort using its attorney
networks
and the courts for collection which partially resulted in a change
in
accounting estimate for recognizing a $9.8 million increase in
finance income in 2004.

Selective Financial Data, page 25

6. In future filings, please present the selected financial data
for
the five-year period ended September 30, 2004 in the same
chronological order as the Consolidated Statement of Operations.
Refer to Staff Accounting Bulletin 11.E, "Chronological Ordering
of
Data".

7. Reconcile the $845,000 of the provision for credit losses for
2004
with the $300,000 for 2004 shown in the Consolidated Statement of
Operations on page F-4 by correcting any incorrect amount in
future
filings or tell us why you believe this presentation is correct.







MD&A, Critical Accounting Policies, page 27

8. We refer to the critical accounting policies regarding the use
of
the interest method or the cost recovery method to account for
your
consumer receivable portfolios. We note the Company, using the
interest method permitted under AICPA Practice Bulletin No. 6 has
made the following changes in estimate regarding cash flows from
receivables in 2004 and 2003:

* in 2004 the Company revised its estimate of future collections
of
accounts receivable based on projected cash flows through 2007,
which
resulted in a $9.8 million increase in finance income during the
year, equal to 25% of pre-tax income for 2004;

* as stated in the "Revenues" section of MD&A on page 29, in 2003
the
Company changed its accounting estimate regarding future
collections
of account receivable resulting in an increase of $8.1 million in
financing income, equal to 47% of pre-tax income for 2004.

Considering the significant impact the change in estimate of
future
collections has had on your pre-tax income for 2003 and 2004,
please
tell us and discuss in MD&A in future filings the following:

* explain the methodology used to determine the material increases
in
projected cash flows through 2007 which resulted in the
significant
changes in estimates of financing income for 2003 and 2004;

* discuss any changes in your methodology for determining future
cash
collections in 2003 and 2004 as compared to prior fiscal years;

* discuss any significant changes in the risk characteristics and
size of your loan portfolio for each period that affected your
estimate of future cash flows;

* state how you determined the total probable collections through
2007 considering the third paragraph on page 27 states the
majority
of the cash you ultimately collect on a portfolio is received
during
the first 18 months after acquiring the portfolio;

* describe how you determine changes in the effective interest
rate
considering the timing and amounts of actual cash received and the
anticipated future cash flow projection for each loan or pool of
loan.

9. We refer to the first paragraph on page 28 that states you
recognized finance income on a portfolio purchases in 2001 at the
gross amount received by the servicer and reported servicing costs
as
an expense on your income statement.  In this regard, tell us and
provide the following information in future filings:


* discuss the authoritative accounting guidance you relied upon to
present finance income on a gross basis for this accounts
receivable
portfolio considering you generally recognize finance income, net
of
collection fees paid to third party collection agencies;

* state the total amount of gross finance income and related
servicing costs recorded separately in the income statement for
each
period in which the portfolio remained outstanding in order to
provide comparability with respect to other finance income
recognized
on a net basis.

10. We refer to the statement that you entered into a fifty
percent
profit sharing agreement with your lender with respect to certain
consumer receivable portfolios you acquired which resulted in a
$1.6
million charge to interest expense in 2003 from a change in
accounting estimate to record a revised third party profit
allocation.  In this regard, please tell us and include in future
filings the following:

* discuss the authoritative accounting literature in which you
relied
upon to record the gross finance income from the profit sharing
agreement and an expense for the change in estimate related to the
third-party profit allocation in 2003;

* state the basis for not recording a charge during 2004
considering
the Company continued to retain the portfolio and the future cash
flows are estimated on a quarterly basis;

* disclose the total original amount of the portfolio subject to
the
participation agreement, the duration of the agreement and the
current balance of the portfolio.

MD&A, Year ended September 30, 2004 compared to the year ended
September 30, 2003, page 29

11. We refer to the "General and Administrative Expenses" section
that states you incurred increased receivable servicing costs due
in
part to the acquisition of a call center in January 2003.   In
this
regard, please tell us and state in future filings the following:

* provide the footnote disclosure required by paragraphs 52 to 55
of
SFAS 141 regarding the terms of the acquisition, including the
total
cost of the acquisition and how it was financed;

* explain why the Consolidated Statement of Cash Flows on page F-6
does not disclose the dollar amount and sources of cash used to
acquire the call center.



12. With respect to the "Provision for Credit Losses" section on
page
29 and Note C, "Allowance for Credit Losses" on page F-10,  please
tell us and provide the following information in future filings:

* describe the reasons why the Company has not recorded an
allowance
for loans losses in 2004 considering it has in its portfolio
performing and semi-performing receivables and has applied the
interest method on portfolios aggregating $144.8 million.  Refer
to
Note B, "Consumer Receivables Acquired for Liquidation" on page F-
10
and the "Overview" section on page 3;

* discuss the methodology used for determining the adequacy of the
allowance for loan losses considering in 2004 the provision of
$300,000 was for the same amount as the finance receivable written
down.  Consider in your response Note A[7], "Credit Losses" states
the provision is charged to maintain the allowance at a level
considered adequate to cover loses of principal in auto loans and
finance receivables;

* describe in a footnote your accounting policies with respect to
determining impairments on loans receivable for which you accrue
interest income.  Disclose any expected changes with respect to
the
adoption of SOP 03-3, effective for fiscal years beginning after
December 15, 2004, that requires decreases in expected cash flows
to
be recorded as impairments to the loans;

* explain the meaning of the statement in the "Provision for
Credit
Losses" section of MD&A for fiscal 2003 on page 30 that the
provision
for credit losses decreased from $1 million in 2002 to $0.00 in
2003
"due to a decrease in the provision for credit losses on your
financed receivables in 2003 as compared to the prior year".  Tell
us
and discuss in future filings the reasons for any material changes
in
the provision, such as changes in the risk characteristics of the
loan portfolio that resulted in the Company not recording a
provision
for credit losses in 2003.

MD&A, Year ended September 30, 2003 compared to the year ended
September 30, 2002, page 29

13. We refer to the statement that most of your factored
receivables
were sold on November 25, 2002 which resulted in a decrease in
finance income on these receivables during 2003 as compared to
2002.
In this regard, please tell us and, if material, disclose in
future
filings:

* the total amount of factored receivables sold and the terms of
the
sale, including if they were sold on a recourse or non-recourse
basis.  If they were sold on a recourse basis, state the recourse
liability recorded in accordance with paragraph 11.c of SFAS 140;


* the gain or loss on the sale of these receivables on the face of
the income statement for 2003;

* the nature and amount of factored receivables that were retained
by
the Company and where they are recorded in the Consolidated
Balance
Sheet on page F-3.

Liquidity and Capital Resources, page 31

14. With respect to the table that shows changes in finance
receivables, tell us and disclose in future filings the amount of
sales of consumer receivable portfolios made to third parties
separately from the cash collections on consumer receivables.
Similar disclosure should be provided with respect to the line
item
"Principal payments received from sale or collection of consumer
receivables" in the "Cash Flows from Investing Activities" section
of
the Consolidated Statement of Cash Flows on page F-6.  In
addition,
the dollar amount of gains or losses on sales of consumer
receivables
should be included in the adjustments to reconcile net income to
net
cash provided by operating activities.

Schedule of Portfolios by Income Recognition Category, page 33

15. Please explain and discuss in future filings how you determine
the effective interest rate for determining finance income earned
on
the interest method portfolios.  Consider in your response the
following:

* describe if you are recording interest income based on the
estimated effective yield on loan pools or by using the
contractual
interest rates on the loans;

* state if losses on loans within the pool are taken into account,
together with the discount, to establish the effective yield or if
losses are offset against the discount;

* explain why the finance income earned of $45.3 million in 2004
is
32% of the $144.8 million receivable carrying value of the
interest
method portfolio at year end.

Item 9A. "Controls and Procedures", page 36

16. We note you have not filed the Accountants report on
management`s
assessment of internal control over financial reporting and
Management`s annual report on internal control over financial
reporting required by Items 308(a) and 308(b) of Regulation S-K
and
PCAOB Auditing Standards No. 2.  In this regard, tell us and state
in
future filings if you qualify for the extended compliance period
in
SEC Release 33-8392 for non-accelerated filers for implementing
Section 404 of the Sarbanes Oxley Act.




Financial Statements for the year ended September 30, 2004

Note A[4], Income Recognition, page F-7

17. We refer to the statement that estimated future cash flows are
reevaluated quarterly.  Tell us and in future filings state the
effects on the reevaluation for each of the following possible
conditions:

* the revised forecasted cash flows are in excess of the
forecasted
cash flow prior to the reevaluation;

* the revised forecasted cash flows are less than the forecasted
cash
flows prior to the reevaluation;

* the revised forecasted cash flows are less than the remaining
carrying value.

Note B, Consumer Receivables Acquired for Liquidation, page F-10

18. Tell us and disclose in future filings the nature and risk
characteristics of the loan portfolios for which the interest
method
and the cost recovery method are appropriate.

Form 10-Q for the period ended March 31, 2005

Note 3, Consumer Receivables Acquired for Liquidation, page 8

19. We refer to the acquisition in March 2005 of Option Card, LLC,
a
consumer debt buyer and debt management company, which included a
portfolio of distressed receivables of $197 million, a facility in
Denver and a computer software system.  In this regard, please
tell
us and include the following information in future filings:

* provide the footnote disclosure required by paragraphs 52 to 55
of
SFAS 141 regarding the acquisition of this business, including the
allocation of the fair value of the business to the acquired
facilities, the computer software system and to any goodwill
recognized in the transaction.  Refer in your response to the
transcript of the March 8, 2004 webcast filed as Exhibit 99.2 of
the
Form 8-K dated March 8, 2005, which states that:

o the acquisition will give the Company a presence in the West,
buying and debt management, an established network and a computer
system that has beneficial features that will be incorporated in
the
Company`s existing system;




o the acquisition will permit the Company to integrate the Option
Card management and its legal network.  Approximately 25 employees
involved in internal collection efforts were acquired as part of
the
Denver office facilities.

o explain why the Consolidated Statement of Cash Flows on page F-6
does not disclose the dollar amount and sources of cash used in
this
acquisition.  Refer in your response to page 3 of the transcript
that
states the transaction was financed with cash and debt from your
credit line.

*	*	*

Closing Comments

      As appropriate, please respond to these comments within 10
business days or tell us when you will provide us with a response.
Please furnish a cover letter with any amendment that keys your
responses to our comments and provides any requested supplemental
information.  Detailed cover letters greatly facilitate our
review.
Please understand that we may have additional comments after
reviewing any amendment and responses to our comments.

        In connection with responding to our comments, please
provide, in writing, a statement from the company acknowledging
that:

* the company is responsible for the adequacy and accuracy of the
disclosure in the filings;

* staff comments or changes to disclosure in response to staff
comments in the filings reviewed by the staff do not foreclose the
Commission from taking any action with respect to the filing; and

* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.













        In addition, please be advised that the Division of
Enforcement has access to all information you provide to the staff
of
the Division of Corporation Finance in our review of your filing
or
in response to our comments on your filing.

      You may contact Edwin Adames (Senior Staff Accountant) at
(202)
551-3447 or me at  (202) 551-3492 if your have any questions
regarding these comments.


						Sincerely,



						John P. Nolan
						Accounting Branch Chief
Asta Funding, Inc.
Mitchell Cohen
Page 1 of 10