FIRST AMENDMENT TO THE
RESIDUAL FORWARD SALE FACILITY

         This First Amendment, dated as of September 30, 2002 (the "Amendment"),
to the Residual Forward Sale Facility, dated as of August 31, 2000 (the
"Agreement"), is made by and between Aames Capital Corporation, a California
corporation (the "Seller"), and Capital Z Investments, L.P., a Bermuda limited
partnership (the "Purchaser").

RECITALS

        WHEREAS, the Seller and Purchaser are parties to the Agreement, pursuant
to which Seller periodically sells to Purchaser, without recourse, certain
excess cash flows created in connection with Seller's periodic sponsorship of
securitizations of mortgage loans; and

        WHEREAS, the Seller and Purchaser wish to amend the Agreement to extend
its term.

         NOW, THEREFORE, for good and valuable consideration, the receipt of
which are hereby acknowledged, the parties hereto agree as follows:

        Section 1. Amendment. In connection with the Agreement, the parties
agree that the term "Sale Period" will be amended and restated in its entirety
as follows:

         "Sale Period" means the period beginning on and including September 1,
2000 until and through the
         earliest to occur of (i) March 31, 2003, (ii) the date on which the
amount paid by Purchaser to Seller
         in respect of the Securities at least equals the Maximum Amount or
(iii) a Termination Event.

        Section 2. Covenants, Representations and Warranties of the Parties.
Each of the parties hereby represents and warrants to the other that (a) this
Amendment constitutes the legal, valid and binding obligations of such party,
enforceable against such party in accordance with its terms, (b) the execution
and delivery by such party of this Amendment has been duly authorized by all
requires corporate action of such party and will not violate any provisions of
the origination documents of such party; and (c) except as expressly amended by
this Amendment, the Agreement remains unaltered and in full force and effect.

        Section 3. Governing Law. This Amendment will be construed, interpreted
and governed by the law of the State of New York, without giving effect to the
conflict of laws principles thereof.

        Section 4. Counterparts. This Amendment may be executed in any number of
counterparts, and all such counterparts will together constitute the same
agreement.

[SIGNATURE PAGE FOLLOWS]

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        IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their duly authorized officers as of the date first shown above.

SELLER AAMES CAPITAL CORPORATION                /s/Ronald J. Nicolas, Jr. Ronald
J. Nicolas, Jr. Chief Financial Officer             PURCHASER CAPITAL Z
INVESTMENTS, L.P.      By: Capital Z Investment Management, Ltd., Its ultimate
general partner By: Name: Title: