Preferred Acceptance Company Investment Opportunities

Preferred Acceptance Company, incorporated in 1994, is engaged in mortgage and consumer lending activities in Eau Claire, Wisconsin, and surrounding areas. The company originates and services residential and commercial real estate mortgage loans and consumer loans.

Preferred Acceptance Company is offering $2,000,000 aggregate principal amount of Promissory Notes available through November 18, 2006. The notes bear a 7.50% per annum interest rate for a one-year term, or a 9.00% per annum interest rate for a three-year term. At the option of Preferred Acceptance Company, Noteholders may elect to renew for one period.

Notes are being sold in denominations of $500.00 with a minimum purchase of $5,000 unless otherwise approved at the sole discretion of the Company. These securities are offered only to bona fide residents of the State of Wisconsin purchasing for investment and not for resale.