UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): April 629, 2011

Desert Capital REIT, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Maryland

(State or Other Jurisdiction of Incorporation)

(Exact Name of Registrant as Specified in Its Charter)


0-51344		20-0495883

(Commission File Number)		(IRS Employer Identification No.)


1291 W. Galleria Drive, Suite 200, Henderson, Nevada		89014

(Address of Principal Executive Offices)		(Zip Code)

(800) 419-2855

(Registrant’s Telephone Number, Including Area Code)

NONE.

(Former Name or Former Address, if Changed Since Last Report)

(800) 419-2855 (Registrant’s Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):


o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)


o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)


o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))


o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 28.0401. ~~Triggering~~Other Events ~~That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement~~.

AsOn ~~previously disclosed~~April 29, ~~Desert Capital REIT~~2011, ~~Inc.,~~ a ~~Maryland~~petition ~~corporation~~for ~~(the~~involuntary ~~“Company”) entered into a Forbearance Agreement dated as of June~~Chapter 11, ~~2010,~~bankruptcy ~~but~~entitled ~~effective~~In asre ofDesert ~~June 23~~Capital REIT, ~~2010 (the~~Inc. ~~“Forbearance Agreement”) with the lenders named therein~~ (~~collectively,~~Case ~~the “Lender”~~No. 11-16624) ~~relating to~~was ~~that~~filed ~~certain~~against ~~Guaranty~~Desert ~~dated~~Capital ~~September 17~~REIT, ~~2007,~~Inc. ~~executed by the Company~~ (the “~~Guaranty~~Company”), ~~which~~by ~~guaranteed~~Taberna toPreferred ~~the~~Funding ~~Lender~~VI ~~the payment of a loan in the original principal amount of $13~~Ltd.,~~675,000~~ ~~(the “Loan”)~~Taberna ~~made~~Preferred byFunding ~~Lender~~VIII ~~to Warm Jones~~Ltd., ~~LLC~~Sage ~~(the~~Trust ~~“Borrower”).~~and ~~The Loan is secured by~~ certain ~~real~~ ~~property~~other ~~collateral~~lenders ~~(the~~named ~~“Collateral”).~~in ~~The Borrower failed to repay~~ the ~~Loan~~petition ~~upon~~in ~~its maturity and~~ the ~~Lender~~United ~~filed~~States aBankruptcy ~~Notice~~Court offor ~~Default and commenced foreclosure proceedings against~~ the ~~Collateral.~~ ~~The~~District ~~Lender also filed an action against the Company for breach~~ of ~~the Guaranty.~~ ~~Pursuant~~Nevada toin ~~the~~Las ~~terms of the Forbearance Agreement~~Vegas, ~~subject~~Nevada. toThe ~~certain~~filing ~~conditions,~~did ~~the~~not ~~Lender~~include ~~(i) agreed to rescind the Notice of Default and forbear and refrain from restarting a foreclosure action or exercising~~ any ~~other~~subsidiary ~~rights~~ or ~~remedies~~affiliate ~~against Borrower or Guarantor that may have existed by virtue~~ of the ~~existing events of default under the Loan, and (ii) waive all outstanding~~ ~~interest, fees and costs that were due or to become due under the Loan during the forbearance period~~Company.

~~The~~Under ~~Lender’s~~the ~~agreement~~involuntary topetition, ~~forbear~~a ~~from~~Trustee ~~exercising~~has ~~its~~not ~~remedies~~been ~~and~~requested ~~waive~~or ~~all~~appointed. ~~outstanding~~Once the Company is ~~interest,~~served ~~fees~~with ~~and~~a ~~costs~~summons ~~was~~and ~~conditioned~~citation ~~on,~~for ~~among~~the ~~other~~involuntary ~~things~~petition, ~~the~~it ~~occurrence~~will ofhave notwenty ~~additional~~(20) days to ~~events~~file ofan ~~default~~answer ~~under~~to the ~~Loan~~petition, during which time it will continue to operate its business.

On April 6, 2011, the Company received notice from the Lender asserting that an event of default had occurred under the Forbearance Agreement and deed of trust securing the Loan as a result of a trustee’s sale of the Collateral conducted pursuant to a $2,550,000 second lien mortgage loan. The notice further stated that as a result of such sale, the Lender exercised its option to call the entire amount of the Loan immediately due.

SIGNATURE

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: ~~April~~May 125, 2011


	DESERT CAPITAL REIT, INC.
	By:	/s/ Todd B. Parriott
		Todd B. Parriott
		Chief Executive Officer

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