<PAGE>

                                                                   EXHIBIT 10.28

THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY
STATE AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN EXEMPTION THEREFROM UNDER SUCH ACT AND UNDER ANY SUCH
APPLICABLE STATE LAWS, OR IN VIOLATION OF THE PROVISIONS OF THIS WARRANT.








                                     WARRANT

               To Purchase Series D Convertible Preferred Stock of

                           AAMES FINANCIAL CORPORATION









<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                                               Page
<S>                                                                                                            <C>
ARTICLE 1. DEFINITIONS............................................................................................1

ARTICLE 2. EXERCISE OF WARRANT....................................................................................4
         Section 2.1.  Manner of Exercise.........................................................................4
         Section 2.2.  Payment of Taxes...........................................................................6
         Section 2.3.  Fractional Shares..........................................................................6

ARTICLE 3. TRANSFER, DIVISION AND COMBINATION.....................................................................6
         Section 3.1.  Transfer...................................................................................6
         Section 3.2.  Division and Combination...................................................................6
         Section 3.3.  Expenses...................................................................................7
         Section 3.4.  Maintenance of Books.......................................................................7

ARTICLE 4. ADJUSTMENTS............................................................................................7
         Section 4.1.  Stock Dividends, Subdivisions, Combinations and Reclassifications..........................7
         Section 4.2.  Issuance of Additional Shares of Common Stock or Convertible Securities....................8
         Section 4.3.  Other Provisions Applicable to Adjustments Under This Section..............................9
         Section 4.4.  Reorganization, Reclassification, Merger, Consolidation or Disposition of Assets..........11
         Section 4.5.  Notices...................................................................................11
         Section 4.6.  Certificates..............................................................................12

ARTICLE 5. NO IMPAIRMENT.........................................................................................12

ARTICLE 6. RESERVATION AND AUTHORIZATION OF  SERIES D PREFERRED STOCK; REGISTRATION WITH OR  APPROVAL OF
                       ANY GOVERNMENTAL AUTHORITY................................................................13

ARTICLE 7. STOCK AND WARRANT TRANSFER BOOKS......................................................................13

ARTICLE 8. RESTRICTIONS ON TRANSFERABILITY.......................................................................13
         Section 8.1.  Restrictive Legend........................................................................14
         Section 8.2.  Transfers.................................................................................14
         Section 8.3.  Termination of Restrictions...............................................................15

ARTICLE 9. SUPPLYING INFORMATION.................................................................................15

ARTICLE 10. LOSS OR MUTILATION...................................................................................16

ARTICLE 11. OFFICE OF THE COMPANY................................................................................16

ARTICLE 12. REGISTRATION RIGHTS..................................................................................16
</TABLE>

                                                          i

<PAGE>

<TABLE>
<S>                                                                                                              <C>
ARTICLE 13. LIMITATION OF LIABILITY..............................................................................16

ARTICLE 14. REPRESENTATION OF HOLDER.............................................................................16

ARTICLE 15. MISCELLANEOUS........................................................................................17
         Section 15.1.   Nonwaiver and Expenses..................................................................17
         Section 15.2.   No Rights As Stockholder................................................................17
         Section 15.3.   Notice Generally........................................................................17
         Section 15.4.   Successors and Assigns..................................................................18
         Section 15.5.   Amendment...............................................................................18
         Section 15.6.   Severability............................................................................18
         Section 15.7.   Headings................................................................................18
         Section 15.8.   Governing Law...........................................................................18
         Section 15.10.  Mutual Waiver of Jury Trial.............................................................18
</TABLE>

                                                        ii
<PAGE>

THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY
STATE AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN EXEMPTION THEREFROM UNDER SUCH ACT AND UNDER ANY SUCH
APPLICABLE STATE LAWS, OR IN VIOLATION OF THE PROVISIONS OF THIS WARRANT.



                                     WARRANT

                         To Purchase 5,000,000 Shares of

                     Series D Convertible Preferred Stock of

                           AAMES FINANCIAL CORPORATION

                  THIS IS TO CERTIFY THAT Specialty Finance Partners, a Bermuda
general partnership ("SFP") or its registered assigns, is entitled, at any time
prior to July 7, 2005 (the "Expiration Date"), to purchase from Aames Financial
Corporation, a Delaware corporation (the "Company"), 5,000,000 shares of Series
D Convertible Preferred Stock, par value $0.001 per share, of the Company (the
"Series D Preferred Stock"), subject to adjustment as provided herein, in whole
or in part, including fractional parts, at a purchase price of $0.85 per share
(the "Exercise Price"), subject to adjustment as set forth herein, all on the
terms and conditions and pursuant to the provisions hereinafter set forth.
Notwithstanding anything to the contrary set forth in this Warrant, this Warrant
shall not be exercisable by the holder hereof until the day on which the Company
files a Certificate of Designations relating to the Series D Preferred Stock
with the Secretary of State of the State of Delaware. Capitalized terms not
otherwise defined herein are used as defined in the Preferred Stock Purchase
Agreement.

                                   ARTICLE 1.
                                   DEFINITIONS

                  As used in this Warrant, the following terms have the
respective meanings set forth below:

                  "Additional Shares of Series D Preferred Stock" shall mean all
shares of Series D Preferred Stock issued by the Company after the Issue Date,
other than Warrant Stock.

                  "Business Day" shall mean any day that is not a Saturday or
Sunday or a day on which banks are required or permitted to be closed in the
State of New York.


<PAGE>

                  "SFP" shall have the meaning set forth in the first paragraph
hereof.

                  "Commission" shall mean the Securities and Exchange
Commission.

                  "Common Stock" shall mean the Common Stock of the Company, par
value $0.001 per share.

                  "Company" shall have the meaning set forth in the first
paragraph hereof.

                  "Conversion Price" shall have the meaning set forth in Section
4.2 hereof.

                  "Convertible Securities" shall mean evidences of indebtedness,
shares of stock or other securities which are convertible into or exchangeable,
with or without payment of additional consideration in cash or property, for
Additional Shares of Series D Preferred Stock, either immediately or upon the
occurrence of a specified date or a specified event.

                  "Current Market Price" shall mean, when used with reference to
shares of Series D Preferred Stock, the closing price per share of Common Stock
on such date and, when used with reference to shares of Series D Preferred Stock
for any period shall mean the average of the daily closing prices per share of
Common Stock for such period. The closing price for each day shall be the last
sale price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange or,
if the Common Stock is not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the Common Stock is listed or admitted to trading or, if the Common
Stock is not listed or admitted to trading on any national securities exchange,
the last quoted sale price or, if not so quoted, the average of the high bid and
low asked prices in the over-the-counter market, as reported by the National
Association of Securities Dealers, Inc. National Market System is not quoted by
any such organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the Common Stock
selected by the Board of Directors of the Corporation. If the Common Stock is
not publicly held or so listed or publicly traded, "Current Market Price" shall
mean the Fair Market Value per share of Common Stock or of such other securities
as determined in good


                                       2
<PAGE>

faith by the Board of Directors of the Corporation based on an opinion of an
independent investment banking firm with an established national reputation as a
value of securities, which opinion may be based on such assumption as such firm
shall deem to be necessary and appropriate.

                  "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission thereunder.

                  "Exercise Price" shall have the meaning set forth in the first
paragraph hereof.

                  "Expiration Date" shall have the meaning set forth in the
first paragraph hereof.

                  "Fair Market Value" shall mean the amount which a willing
buyer would pay a willing seller in an arm's-length transaction.

                  "GAAP" shall mean generally accepted accounting principles in
the United States of America as from time to time in effect.

                  "holder" shall mean, as the context requires, the Person in
whose name this Warrant is registered on the books of the Company maintained for
such purpose and/or the Person holding any Warrant Stock.

                  "Issue Date" shall mean the date on which this Warrant is
issued.

                  "Person" shall mean any individual, sole proprietorship,
partnership, joint venture, trust, corporation or other entity and shall include
any successor (by merger or otherwise) of such entity.

                  "Preferred Stock Purchase Agreement" shall mean the Preferred
Stock Purchase Agreement, dated as of May 21, 2000 between the Company and SFP,
as amended.

                  "Registration Rights Agreement" shall mean the Registration
Rights Agreement, dated as of December 23, 1999, between the Company and Capital
Z Financial Services Fund II, L.P., as amended.

                  "Restricted Series D Preferred Stock" shall mean shares of
Series D Preferred Stock which are, or which upon their issuance on the exercise
of this Warrant would be, evidenced by a certificate bearing the restrictive
legend set forth in Section 8.1(a).


                                       3
<PAGE>

                  "Securities Act" shall mean the Securities Act of 1933, as
amended, and the rules and regulations of the Commission thereunder.

                  "Series B Preferred Stock" shall mean the Series B Convertible
Preferred Stock of the Company, par value $0.001 per share.

                  "Series D Preferred Stock" shall mean the Series D Convertible
Preferred Stock of the Company, par value $0.001 per share.

                  "Subsidiary" shall mean any corporation of which an aggregate
of more than 50% of the outstanding stock having ordinary voting power to elect
a majority of the board of directors of such corporation (irrespective of
whether, at the time, stock of any other class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) is at the time, directly or indirectly, owned legally or
beneficially by the Company and/or one or more Subsidiaries of the Company.

                  "Trading Day" means a day on which the principal national
securities exchange on which the Series D Preferred Stock is listed or admitted
to trading is open for the transaction of business or, if the Series D Preferred
Stock is not listed or admitted to trading on any national securities exchange,
a Business Day.

                  "Transaction" shall have the meaning set forth in Section 4.5
hereof.

                  "transfer" shall mean any transfer, sale, encumbrance,
hypothecation or other disposition of this Warrant or any Warrant Stock or of
any interest in either thereof.

                  "Transfer Notice" shall have the meaning set forth in Section
8.2.

                  "Warrant Price" shall mean an amount equal to (i) the number
of shares of Series D Preferred Stock being purchased upon exercise of this
Warrant pursuant to Section 2.1, multiplied by (ii) the Exercise Price as of the
date of such exercise.

                  "Warrant Stock" shall mean the shares of Series D Preferred
Stock purchased by the holder of this Warrant upon the exercise thereof.


                                       4
<PAGE>

                                   ARTICLE 2.
                               EXERCISE OF WARRANT

                  Section 2.1. MANNER OF EXERCISE. From and after the date
hereof and until 5:00 P.M., New York time, on the Expiration Date, the holder
may exercise this Warrant for all or any part of the number of shares of Series
D Preferred Stock purchasable hereunder.

                  In order to exercise this Warrant, in whole or in part, the
holder shall deliver to the Company at its office at 2 California Plaza, 350
South Grand Avenue, 52nd Floor, Los Angeles, California 90071, or at the office
or agency designated by the Company pursuant to Section 11, (i) a written notice
of the holder's election to exercise this Warrant, which notice shall specify
the number of shares of Series D Preferred Stock to be purchased, (ii) payment
of the Warrant Price in the manner provided below, and (iii) this Warrant. Such
notice shall be substantially in the form of the subscription form appearing at
the end of this Warrant as Exhibit A, duly executed by or on behalf of the
holder. Upon receipt thereof, the Company shall, as promptly as practicable, and
in any event within five (5) Business Days thereafter, execute or cause to be
executed and deliver or cause to be delivered to the holder a certificate or
certificates representing the aggregate number of full shares of Series D
Preferred Stock issuable upon such exercise, together with cash in lieu of any
fraction of a share, as hereinafter provided. The stock certificate or
certificates so delivered shall be, to the extent possible, in such denomination
or denominations as such holder shall request in the notice and shall be
registered in the name of the holder or, subject to Section 8, such other name
as shall be designated in the notice. This Warrant shall be deemed to have been
exercised and such certificate or certificates shall be deemed to have been
issued, and the holder or any other Person so designated to be named therein
shall be deemed to have become a holder of record of such shares for all
purposes, as of the date the notice, together with the cash, check or checks
and/or securities, if any, and this Warrant, are received by the Company as
described above and all taxes required to be paid by the holder, if any,
pursuant to Section 2.2 prior to the issuance of such shares have been paid. If
this Warrant shall have been exercised in part, the Company shall, at the time
of delivery of the certificate or certificates representing Warrant Stock,
deliver to the holder a new Warrant evidencing the rights of the holder to
purchase the unpurchased shares of Series D Preferred Stock called for by this
Warrant, which new Warrant shall in all other respects be identical with this
Warrant, or, at the request of the holder, appropriate notation may be made on
this Warrant and the same returned to the holder.


                                       5
<PAGE>

                  Payment of the Warrant Price shall be made at the option of
the holder by cash, wire transfer to an account in a bank located in the United
States designated for such purpose by the Company, or certified or official bank
check, or by transfer to the Company of shares of Series B Preferred Stock or
Series D Preferred Stock, or any combination thereof. In the event of the
application shares of Series B Preferred Stock or Series D Preferred Stock to
the payment of the Warrant Price, the amount to be credited to the payment of
the Warrant Price shall be stated value per share (as described in the Company's
Certificate of Incorporation, as amended) plus an amount per share equal to all
accrued and unpaid dividends thereon, whether or not declared, to the date of
such exercise, provided that no such credit shall be made with respect to any
such dividends if the holder of such shares held such shares on the record date
therefor.

                  Section 2.2. PAYMENT OF TAXES. The Company shall pay all
expenses in connection with, and all taxes and other governmental charges that
may be imposed with respect to, the issue or delivery of the Warrant Shares,
unless such tax or charge is imposed by law upon the holder, in which case such
taxes or charges shall be paid by the holder. The Company shall not be required,
however, to pay any tax or other charge imposed in connection with any transfer
involved in the issue of any certificate for shares of Series D Preferred Stock
issuable upon exercise of this Warrant in any name other than that of the
holder, and in such case the Company shall not be required to issue or deliver
any stock certificate until such tax or other charge has been paid or it has
been established to the satisfaction of the Company that no such tax or other
charge is due.

                  Section 2.3. FRACTIONAL SHARES. The Company shall not be
required to issue a fractional share of Series D Preferred Stock upon exercise
of this Warrant. As to any fraction of a share which the holder of this Warrant
would otherwise be entitled to purchase upon such exercise, the Company shall
pay a cash adjustment in respect of such final fraction in an amount equal to
the same fraction of the Current Market Price per share of Common Stock on the
date of exercise.

                                   ARTICLE 3.
                       TRANSFER, DIVISION AND COMBINATION

                  Section 3.1. TRANSFER. Subject to compliance with Section 8,
transfer of this Warrant and all rights hereunder, in whole or in part, shall be
registered on the books of the Company to be maintained for such purpose, upon
surrender of this Warrant at the principal office of the Company referred to in
Section 2.1


                                       6
<PAGE>

or the office or agency designated by the Company pursuant to Section 11,
together with a written assignment of this Warrant substantially in the form of
Exhibit B hereto duly executed by the holder or its agent or attorney and funds
sufficient to pay any transfer taxes payable upon the making of such transfer.
Upon such surrender and, if required, such payment, the Company shall, subject
to Section 8, execute and deliver a new Warrant or Warrants in the name(s) of
the assignee or assignees and in the denomination(s) specified in such
instrument of assignment, and shall issue to the assignor a new Warrant
evidencing the portion of this Warrant not so assigned, and this Warrant shall
promptly be canceled. A Warrant, if properly assigned in compliance with Section
8, may be exercised by a new holder for the purchase of shares of Series D
Preferred Stock without having a new Warrant issued.

                  Section 3.2. DIVISION AND COMBINATION. Subject to Section 8,
this Warrant may be divided or combined with other Warrants for the purchase of
Series D Preferred Stock upon presentation hereof at the aforesaid office or
agency of the Company, together with a written notice specifying the names and
denominations in which new Warrants are to be issued, signed by the holder or
its agent or attorney. Subject to compliance with Section 3.1 and with Section
8, as to any transfer which may be involved in such division or combination, the
Company shall execute and deliver a new Warrant or Warrants in exchange for the
Warrant or Warrants to be divided or combined in accordance with such notice.

                  Section 3.3. EXPENSES. The Company shall prepare, issue and
deliver at its own expense (other than transfer taxes) the new Warrant or
Warrants under this Section 3.

                  Section 3.4. MAINTENANCE OF BOOKS. The Company agrees to
maintain, at its aforesaid office or agency, books for the registration and the
registration of transfer of the Warrants.

                                   ARTICLE 4.
                                   ADJUSTMENTS

                  The number of shares of Series D Preferred Stock for which
this Warrant is exercisable, or the price at which such shares may be purchased
upon exercise of this Warrant, shall be subject to adjustment from time to time
as set forth in this Section 4. The Company shall give the holder notice of any
event described below which requires an adjustment pursuant to this Section 4 at
the time of such event.


                                       7
<PAGE>

                  Section 4.1. STOCK DIVIDENDS, SUBDIVISIONS, COMBINATIONS AND
RECLASSIFICATIONS. If the Company shall at any time or from time to time after
the Issue Date:

                  (a)  pay a dividend or make a distribution, on the
         outstanding shares of Series D Preferred Stock in Additional Shares
         of Series D Preferred Stock,

                  (b)  subdivide its outstanding shares of Series D Preferred
         Stock into a larger number of shares of Series D Preferred Stock,

                  (c)  combine its outstanding shares of Series D Preferred
         Stock into a smaller number of shares of Series D Preferred Stock, or

                  (d)  issue by reclassification of its shares of Series
         D Preferred Stock any shares of capital stock of the Company,

then, and in each such case, the number of shares of Series D Preferred Stock
issuable upon exercise of the Warrants evidenced hereby immediately prior to
such event or the record date therefor, whichever is earlier, shall be adjusted
so that the holder of any Warrant evidenced hereby thereafter exercised shall be
entitled to receive the number of shares of Series D Preferred Stock or other
securities of the Company which such holder would have owned or have been
entitled to receive after the happening of any of the events described above,
had such Warrant been exercised immediately prior to the happening of such event
or the record date therefor, whichever is earlier. An adjustment made pursuant
to this Section 4.1 shall become effective (x) in the case of any such dividend
or distribution, immediately after the close of business on the record date for
the determination of holders of shares of Series D Preferred Stock entitled to
receive such dividend or distribution, or (y) in the case of any such
subdivision, reclassification or combination, at the close of business on the
day upon which such corporate action becomes effective.

                  Section 4.2. ISSUANCE OF ADDITIONAL SHARES OF SERIES D
PREFERRED STOCK OR CONVERTIBLE SECURITIES. In the case the Corporation shall,
after the Issue Date, issue or sell:

                  (a) Additional Shares of Series D Preferred Stock at a price
         per share, or

                  (b) Convertible Securities having a Conversion Price per
         share,


                                       8
<PAGE>

less than the Current Market Price (for a period of 15 consecutive Trading Days
prior to such date), then, and in each such case, the number of shares of Series
D Preferred Stock issuable upon exercise of the Warrants evidenced hereby shall
be adjusted so that the holder of each Warrant evidenced hereby shall be
entitled to receive, upon the exercise thereof, the number of shares of Series D
Preferred Stock determined by multiplying (A) the number of shares of Series D
Preferred Stock issuable upon exercise of the Warrants evidenced hereby on the
day immediately prior to such date by (B) a fraction, the numerator of which
shall be the sum of (1) the number of shares of Series D Preferred Stock
outstanding on the date on which such shares or Convertible Securities are
issued and (2) the number of Additional Shares of Series D Preferred Stock
issued, or into which the Convertible Securities may convert, and the
denominator of which shall be the sum of (x) the number of shares of Series D
Preferred Stock outstanding on such date and (y) the number of shares of Series
D Preferred Stock which the aggregate consideration receivable by the Company
for the total number of shares of Series D Preferred Stock so issued, or the
number of shares of Series D Preferred Stock which the aggregate of the
Conversion Price of such Convertible Securities so issued, would purchase at the
Current Market Price on such date.

                  An adjustment made pursuant to this Section 4.2 shall be made
on the next Business Day following the date on which any such issuance is made
and shall be effective retroactively immediately after the close of business on
such date. For purposes of this Section 4.2, the aggregate consideration
receivable by the Company in connection with the issuance of any securities
shall be deemed to be the sum of the aggregate offering price to the public
(before deduction of underwriting discounts or commissions and expenses payable
to third parties), and the "Conversion Price" of any Convertible Securities is
the total amount received or receivable by the Company as consideration for the
issue or sale of such Convertible Securities (before deduction of underwriting
discounts or commissions and expenses payable to third parties) plus the minimum
aggregate amount of additional consideration, if any, payable to the Corporation
upon the conversion, exchange or exercise of any such Convertible Securities.

                  Neither (A) the issuance of any shares of Series D Preferred
Stock (whether treasury shares or newly issued shares) pursuant to a dividend or
distribution on, or subdivision, combination or reclassification of, the
outstanding shares of Series D Preferred Stock requiring an adjustment in the
number of shares of Series D Preferred Stock issuable upon exercise of the
Warrants evidenced hereby pursuant to Section 4.1, or pursuant to any employee
benefit plan or program of the Company or pursuant


                                       9
<PAGE>

to any option, warrant, right, or Convertible Security outstanding as of the
date hereof (including, but not limited to, the Rights, the Series B Preferred
Stock, the Series D Preferred Stock and the Warrants) nor (B) the issuance of
shares of Series D Preferred Stock pursuant thereto shall be deemed to
constitute an issuance of Series D Preferred Stock or Convertible Securities by
the Company to which this Section 4.2 applies.

                  Upon expiration of any Convertible Securities which shall not
have been exercised or converted and for which an adjustment shall have been
made pursuant to this Section 4.2, the Conversion Price computed upon the
original issue thereof shall upon expiration be recomputed as if the only
additional shares of Series D Preferred Stock issued were such shares of Series
D Preferred Stock (if any) actually issued upon exercise or conversion of such
Convertible Securities and the consideration received therefor was the
consideration actually received by the Corporation for the issue of such
Convertible Securities (whether or not exercised or converted) plus the
consideration actually received by the Corporation upon such exercise of
conversion.

                  Section 4.2  [Reserved]

                  Section 4.3. OTHER PROVISIONS APPLICABLE TO ADJUSTMENTS UNDER
THIS SECTION. The following provisions shall be applicable to the making of
adjustments provided for in this Section 4:

                  (a)  For purposes of this Section 4, the number of shares
         of Series D Preferred Stock at any time outstanding shall not
         include any shares of Series D Preferred Stock then owned or held by
         or for the account of the Company.

                  (b)  The term "dividend", as used in this Section 4 shall
         mean a dividend or other distribution upon stock of the Company
         except pursuant to the Rights Agreement. Notwithstanding anything in
         this Section 4 to the contrary, the number of shares of Series D
         Preferred Stock issuable upon exercise of the Warrants evidenced hereby
         shall not be adjusted as a result of any dividend, distribution or
         issuance of securities of the Company pursuant to the Rights Agreement.

                  (c)  Notwithstanding anything in this Section 4 to the
         contrary, the Company shall not be required to give effect to any
         adjustment in the number of shares of Series D Preferred Stock issuable
         upon exercise of the Warrants evidenced hereby unless and until the net
         effect of one or more adjustments (each of which shall be carried
         forward), determined as above provided, shall have resulted in a


                                       10
<PAGE>

         change in the number of shares of Series D Preferred Stock issuable
         upon exercise of the Warrants evidenced hereby by at least
         one-hundredth of one share of Series D Preferred Stock, and when the
         cumulative net effect of more than one adjustment so determined shall
         be to change the number of shares of Series D Preferred Stock issuable
         upon exercise of the Warrants evidenced hereby by at least
         one-hundredth of one share of Series D Preferred Stock, such change in
         the number of shares of Series D Preferred Stock issuable upon exercise
         of the Warrants evidenced hereby shall thereupon be given effect.

                  (d) The certificate of any firm of independent public
         accountants of recognized standing selected by the Board of Directors
         of the Company (which may be the firm of independent public accountants
         regularly employed by the Company) shall be presumptively correct for
         any computation made under this Section 4.

                  (e) If the Company shall take a record of the holders of
         its Series D Preferred Stock for the purpose of entitling them to
         receive a dividend or other distribution, and shall thereafter and
         before the distribution to stockholders thereof legally abandon its
         plan to pay or deliver such dividend or distribution, then, no
         adjustment in the number of shares of Series D Preferred Stock issuable
         upon exercise of the Warrants evidenced hereby shall be required by
         reason of the taking of such record.

                  (f) There shall be no adjustment of the number of shares of
         Series D Preferred Stock issuable upon exercise of the Warrants
         evidenced hereby in case of the issuance of any stock of the
         Company in a merger, reorganization, acquisition or other similar
         transaction except as set forth in Sections 4.1, 4.2 and 4.5.

                  (g) Notwithstanding anything herein to the contrary,  the
         Company agrees not to enter into any transaction which, by reason of
         any adjustment hereunder, would cause the Exercise Price to be less
         than the par value per share of Series D Preferred Stock.

                  (h) Upon each adjustment to the number of shares of Series
         D Preferred Stock issuable upon exercise of the Warrants pursuant to
         Sections 4.1, 4.2 or 4.3, the Exercise Price effective immediately
         prior to the making of such adjustment shall thereafter be adjusted
         to be the amount obtained by (i) multiplying (A) the applicable
         number of shares of Series D Preferred Stock issuable upon exercise
         of the Warrants immediately prior to such adjustment by (B)
         the


                                       11
<PAGE>

         Exercise Price in effect immediately prior to such adjustment and (ii)
         dividing the product so obtained by the number of shares of Series D
         Preferred Stock issuable upon exercise of the Warrants immediately
         after such adjustment.

                  Section 4.4. REORGANIZATION, RECLASSIFICATION, MERGER,
CONSOLIDATION OR DISPOSITION OF Assets. In case of any reorganization or
reclassification of outstanding shares of Series D Preferred Stock (other than a
reclassification covered by Section 4.1), or in case of any consolidation or
merger of the Company with or into another corporation, or in the case of any
sale or conveyance to another corporation of the property of the Company as an
entirety or substantially as an entirety (each of the foregoing being referred
to as a "Transaction"), each such Warrant then outstanding shall thereafter be
exercisable for, in lieu of the Series D Preferred Stock issuable upon such
exercise prior to consummation of the Transaction, the kind and amount of shares
of stock and other securities and property receivable (including cash) upon the
consummation of the Transaction by a holder of that number of shares of Series D
Preferred Stock issuable upon exercise of such Warrant immediately prior to the
Transaction (including, on a pro rata basis, the cash, securities or property
received by holders of Series D Preferred Stock in any tender or exchange offer
that is a step in the Transaction).

                  Section 4.5. NOTICES TO WARRANTHOLDERS. In case at any time or
from time to time, prior to the Expiration Date, the Company shall pay any
dividend or make any other distribution to the holders of its Series D Preferred
Stock, or shall offer for subscription pro rata to the holders of its Series D
Preferred Stock any additional shares of stock of any class or any other right,
or there shall be any capital reorganization or reclassification of the Series D
Preferred Stock of the Company or consolidation or merger of the Company with or
into another corporation, or any sale or conveyance to another corporation of
the property of the Company as an entirety or substantially as an entirety, or
there shall be a voluntary or involuntary dissolution, liquidation or winding up
of the Company, then, in any one or more of said cases the Company shall give at
least 20 days' prior written notice (the time of mailing of such notice shall be
deemed to be the time of giving thereof) to the registered holder of the
Warrants evidenced hereby at its address as shown on the books of the Company
maintained by the Transfer Agent thereof of the date on which (i) the books of
the Company shall close or a record shall be taken for such stock dividend,
distribution or subscription rights or (ii) such reorganization,
reclassification, consolidation, merger, sale or conveyance, dissolution,
liquidation or winding up shall take place, as the case may be, provided that in
the case of any Transaction to which Section 4.5 applies the Company shall give
at least 30


                                       12
<PAGE>

days' prior written notice as aforesaid. Such notice shall also specify the date
as of which the holders of the Series D Preferred Stock of record shall
participate in said dividend, distribution or subscription rights or shall be
entitled to exchange their Series D Preferred Stock for securities or other
property deliverable upon such reorganization, reclassification, consolidation,
merger, sale or conveyance or participate in such dissolution, liquidation or
winding up, as the case may be. Failure to give such notice shall not invalidate
any action so taken.

                  Section 4.6. CERTIFICATES. Upon any adjustment of the number
of shares of Series D Preferred Stock issuable upon exercise of the Warrants
evidenced hereby or of the Exercise Price, then, and in each such case, the
Company shall promptly deliver to the holders of the Warrants and the Series D
Preferred Stock, a certificate signed by the President or a Vice President and
by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant
Secretary of the Company setting forth in reasonable detail the event requiring
the adjustment and the method by which such adjustment was calculated and
specifying the increased or decreased number of shares of Series D Preferred
Stock issuable upon exercise of the Warrants evidenced hereby and the Exercise
Price then in effect following such adjustment.

                                   ARTICLE 5.
                                  NO IMPAIRMENT

                  The Company shall not by any action including, without
limitation, amending its certificate of incorporation or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such actions as may be necessary or appropriate to protect the
rights of the holder of the Warrant against impairment. Without limiting the
generality of the foregoing, the Company will (a) not increase the par value of
any shares of Series D Preferred Stock receivable upon the exercise of this
Warrant above the Exercise Price immediately prior to such increase in par
value, (b) take all such action as may be necessary or appropriate in order that
the Company may validly and legally issue fully paid and nonassessable shares of
Series D Preferred Stock, free and clear of any liens, claims, encumbrances and
restrictions (other than as provided herein) upon the exercise of this Warrant,
and (c) use its best efforts to obtain all such authorizations, exemptions or
consents from any public regulatory body having jurisdiction thereof as may be


                                       13
<PAGE>

necessary to enable the Company to perform its obligations under this Warrant.

                  Upon the request of the holder of the Warrant, the Company
will at any time during the period this Warrant is outstanding acknowledge in
writing, in form satisfactory to the holder of this Warrant, the continuing
validity of this Warrant and the obligations of the Company hereunder.

                                   ARTICLE 6.
                        RESERVATION AND AUTHORIZATION OF
                 SERIES D PREFERRED STOCK; REGISTRATION WITH OR
                     APPROVAL OF ANY GOVERNMENTAL AUTHORITY

                  The Company covenants and agrees that, until the Expiration
Date, the Company shall at all times reserve and keep available for issue upon
the exercise of Warrants such number of its authorized but unissued shares of
Series D Preferred Stock as will be sufficient to permit the exercise in full of
all outstanding Warrants. All shares of Series D Preferred Stock which shall be
so issuable, when issued upon exercise of Warrants and payment therefor in
accordance with the terms of such Warrant, shall be duly and validly issued,
fully paid and nonassessable and free and clear of any liens, claims and
restrictions (other than as provided herein). No stockholder of the Company has
or shall have any preemptive rights to subscribe for such shares of Series D
Preferred Stock.

                  Before taking any action which would result in an adjustment
in the number of shares of Series D Preferred Stock for which this Warrant is
exercisable or in the Exercise Price, the Company shall obtain all such
authorizations or exemptions thereof, or consents thereto, as may be necessary
from any public regulatory body or bodies having jurisdiction thereof.

                                   ARTICLE 7.
                        STOCK AND WARRANT TRANSFER BOOKS

                  The Company will not at any time, except upon dissolution,
liquidation or winding up of the Company, close its stock transfer books or
Warrant transfer books so as to result in preventing or delaying the exercise or
transfer of any Warrant.

                                   ARTICLE 8.
                         RESTRICTIONS ON TRANSFERABILITY

                  The Warrants and the Warrant Stock shall not be transferred
before satisfaction of the conditions specified in this Section 8, which
conditions are intended to ensure compliance with the provisions of the
Securities Act and state


                                       14
<PAGE>

securities laws with respect to the Transfer of any Warrant or any Warrant
Stock. The holder, by acceptance of this Warrant, agrees to be bound by the
provisions of this Section 8.

                  Section 8.1.  RESTRICTIVE LEGEND.

                  (a) Except as otherwise provided in this Section 8, each
         certificate for Warrant Stock initially issued upon the exercise
         of this Warrant, and each certificate for Warrant Stock issued to any
         subsequent transferee of any such certificate, shall be stamped or
         otherwise imprinted with a legend in substantially the following form:

                  "The shares represented by this certificate have not been
                  registered under the Securities Act of 1933, as amended, or
                  the securities laws of any state and are subject to the
                  conditions specified in a certain Warrant dated July 12 2000,
                  originally issued by Aames Financial Corporation. The shares
                  represented by this certificate may not be transferred in
                  violation of such Act and laws, the rules and regulations
                  thereunder or the provisions of the Warrant. A copy of the
                  form of said Warrant is on file with the Secretary of Aames
                  Financial Corporation. The holder of this certificate, by
                  acceptance of this certificate, agrees to be bound by the
                  provisions of such Warrant."

                  (b) Except as otherwise provided in this Section 8, each
         Warrant shall be stamped or otherwise imprinted with a legend in
         substantially the following form:

                  "This Warrant and the securities represented hereby have not
                  been registered under the Securities Act of 1933, as amended,
                  or the securities laws of any state and may not be sold or
                  otherwise transferred in the absence of such registration or
                  an exemption therefrom under such Act and under any such
                  applicable state laws, or in violation of the provisions of
                  this Warrant."

                  Section 8.2. TRANSFERS. Prior to any transfer or attempted
transfer of any Warrants or any shares of Restricted Series D Preferred Stock,
the holder of such Warrants or Restricted Series D Preferred Stock shall give
notice (a "Transfer Notice") to the Company of such holder's intention to effect
such transfer, describing the manner and circumstances of the proposed transfer,
and obtain from counsel a written opinion


                                       15
<PAGE>

addressed and reasonably satisfactory to the Company that the proposed transfer
of such Warrants or such Restricted Series D Preferred Stock may be effected
without registration under the Securities Act and applicable state securities
laws. After receipt of the Transfer Notice and written opinion, the Company
shall, within two Business Days thereof, so notify the holder of such Warrants
or such Restricted Series D Preferred Stock and such holder shall thereupon be
entitled to transfer such warrants or such Restricted Series D Preferred Stock,
in accordance with the terms of the Transfer Notice. Each certificate, if any,
evidencing such shares of Restricted Series D Preferred Stock issued upon such
transfer shall bear the restrictive legend set forth in Section 8.1(a), and each
Warrant issued upon such transfer shall bear the restrictive legend set forth in
Section 8.1(b), unless in the written opinion of counsel addressed to the
Company such legend is not required in order to ensure compliance with the
Securities Act.

                  Section 8.3. TERMINATION OF RESTRICTIONS. Notwithstanding the
foregoing provisions of Section 8, the restrictions imposed by this Section 8
upon the transferability of the Warrants, the Warrant Stock and the Restricted
Series D Preferred Stock (or Series D Preferred Stock issuable upon the exercise
of the Warrants) and the legend requirements of Section 8.1 shall terminate as
to any particular Warrant or share of Warrant Stock or Restricted Series D
Preferred Stock (or Series D Preferred Stock issuable upon the exercise of the
Warrants) (i) as to the Warrant Stock and Restricted Series D Preferred Stock,
when and so long as the resale of such security shall have been effectively
registered under the Securities Act and disposed of pursuant thereto, or (ii) as
to the Warrant, Warrant Stock and Restricted Series D Preferred Stock, when the
holder of the Warrant, Warrant Stock or Restricted Series D Preferred Stock
shall have delivered to the Company the written opinion of counsel addressed and
reasonably satisfactory to the Company stating that such legend is not required
in order to ensure compliance with the Securities Act. Whenever the restrictions
imposed by this Section shall terminate as to any share of Restricted Series D
Preferred Stock, as hereinabove provided, the holder thereof shall be entitled
to receive from the Company, at the Company's expense (except for any transfer
taxes), a new certificate representing such Series D Preferred Stock not bearing
the restrictive legend set forth in Section 8.1(a).

                                   ARTICLE 9.
                              SUPPLYING INFORMATION

                  The Company shall cooperate with the holder of the Warrant and
the holder of Restricted Series D Preferred Stock in supplying such information
as may be reasonably requested by such


                                       16
<PAGE>

holder or reasonably necessary for such holder to complete and file any
information reporting forms presently or hereafter required by the Commission as
a condition to the availability of an exemption from the Securities Act for the
sale of any Warrant or Restricted Series D Preferred Stock.

                                   ARTICLE 10.
                               LOSS OR MUTILATION

                  Upon receipt by the Company from any holder of evidence
reasonably satisfactory to the Company of the ownership of and the loss, theft,
destruction or mutilation of this Warrant and indemnity reasonably satisfactory
to it and in case of mutilation upon surrender and cancellation hereof, the
Company will execute and deliver in lieu hereof a new Warrant of like tenor to
the holder; PROVIDED, in the case of mutilation, no indemnity shall be required
if this Warrant in identifiable form is surrendered to the Company for
cancellation.

                                   ARTICLE 11.
                              OFFICE OF THE COMPANY

                  As long as any of the Warrants remain outstanding, the Company
shall maintain an office or agency (which may be the principal executive offices
of the Company) where the Warrants may be presented for exercise, registration
of transfer, division or combination as provided in this Warrant.

                                   ARTICLE 12.
                               REGISTRATION RIGHTS

                  The Warrant Stock issuable upon exercise of this Warrant are
entitled to the benefits of the Registration Rights Agreement. The Company shall
keep a copy of the Registration Rights Agreement, and any amendments thereto, at
the office or agency designated by the Company pursuant to Section 11 and shall
furnish copies thereof to the holder upon request.

                                   ARTICLE 13.
                             LIMITATION OF LIABILITY

                  No provision hereof, in the absence of affirmative action by
the holder to purchase shares of Series D Preferred Stock, and no enumeration
herein of the rights or privileges of the holder hereof, shall give rise to any
liability of the holder for the purchase price of any Series D Preferred Stock
or as a stockholder of the Company, whether such liability is asserted by the
Company or by creditors of the Company.


                                       17
<PAGE>

                                   ARTICLE 14.
                            REPRESENTATION OF HOLDER

                  The holder represents that it is acquiring the Warrant and the
Warrant Stock for the purpose of investment and not with a view to the resale or
distribution hereof or thereof; PROVIDED, that the disposition of holder's
property shall at all times be and remain within its control.

                                   ARTICLE 15.
                                  MISCELLANEOUS

                  Section 15.1. NONWAIVER AND EXPENSES. No course of dealing or
any delay or failure to exercise any right hereunder on the part of the parties
shall operate as a waiver of such right or otherwise prejudice the parties'
rights, powers or remedies. If the Company fails to comply with any provision of
this Warrant, the Company shall pay to the holder such amounts as shall be
sufficient to cover any costs and expenses including, but not limited to,
reasonable attorneys' fees incurred by the holder in collecting any amounts due
pursuant hereto or in otherwise enforcing any of its rights, powers or remedies
hereunder.

                  Section 15.2. NO RIGHTS AS STOCKHOLDER. The Person in whose
name this Warrant is registered shall be deemed the owner hereof and of the
Warrants evidenced hereby for all purposes. The registered holder of this
Warrant shall not be entitled to any rights whatsoever as a stockholder of the
Company except as herein provided.

                  Section 15.3. NOTICE GENERALLY. Any notice, demand, request,
consent, approval, declaration, delivery or other communication hereunder to be
made pursuant to the provisions of this Warrant shall be sufficiently given or
made if in writing and either delivered in person with receipt acknowledged or
sent by registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:

                  (a) If to the holder, at its last known address appearing
         on the books of the Company maintained for such purpose.


                                       18
<PAGE>

                  (b)        If to the Company:

                             Aames Financial Corporation
                             2 California Plaza
                             350 South Grand Avenue
                             Los Angeles, California 90071
                             Attention:  Corporate Secretary
                             Fax No.: (323) 210-5026

                             with a copy to:

                             Troop Steuber Pasich Reddick & Tobey
                             2029 Century Park East
                             Los Angeles, California 90067
                             Attention:  C. N. Franklin Reddick, Esq.
                             Fax No.: (310) 728-2204


or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in writing
by the party entitled to receive such notice. Every notice, demand, request,
consent, approval, declaration, delivery or other communication hereunder shall
be deemed to have been duly given or served on the date on which personally
delivered, with receipt acknowledged, or three (3) Business Days after the same
shall have been deposited in the United States mail.

                  Section 15.4. SUCCESSORS AND ASSIGNS. Subject to the
provisions of Sections 3.1 and 8, (i) this Warrant and the rights evidenced
hereby shall inure to the benefit of and be binding upon the successors of the
Company and the successors and assigns of the holder, and (ii) the provisions of
this Warrant are intended to be for the benefit of all holders from time to time
of this Warrant, and shall be enforceable by any such holders.

                  Section 15.5. AMENDMENT. The Warrants may be modified or
amended or the provisions thereof waived with the written consent of the Company
and the holders of the majority of the portion of this Warrant then outstanding.

                  Section 15.6. SEVERABILITY. Wherever possible, each provision
of this Warrant shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Warrant shall be prohibited
by or invalid under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Warrant.


                                       19
<PAGE>

                  Section 15.7. HEADINGS. The headings used in this Warrant are
for the convenience of reference only and shall not, for any purpose, be deemed
a part of this Warrant.

                  Section 15.8. GOVERNING LAW. This Warrant shall be governed by
and construed in accordance with the laws of the State of Delaware, without
giving effect to conflicts of law principles thereof.

                  Section 15.10. MUTUAL WAIVER OF JURY TRIAL. BECAUSE DISPUTES
ARISING IN CONNECTION WITH COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND
ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH
APPLICABLE STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE
PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH
APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF
THE JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING BROUGHT TO ENFORCE OR DEFEND ANY
RIGHTS OR REMEDIES UNDER THIS WARRANT.


                                       20
<PAGE>

                  IN WITNESS WHEREOF, the Company has caused this Warrant to be
duly executed by its authorized officer on July 12, 2000.



                                            AAMES FINANCIAL CORPORATION



                                            By:      /s/ A. Jay Meyerson
                                               -----------------------------
                                            Name: A. Jay Meyerson
                                            Title: Chief Executive Officer
<PAGE>

                                    EXHIBIT A

                                SUBSCRIPTION FORM

                 [To be executed only upon exercise of Warrant]

                  The undersigned registered owner of this Warrant irrevocably
exercises this Warrant for the purchase of _____ Shares of Series D Preferred
Stock of AAMES FINANCIAL CORPORATION and herewith makes payment therefor, all at
the price and on the terms and conditions specified in this Warrant and requests
that certificates for the shares of Series D Preferred Stock hereby purchased
(and any securities or other property issuable upon such exercise) be issued in
the name of and delivered to __________________ whose address is
____________________ and, if such shares of Series D Preferred Stock shall not
include all of the shares of Series D Preferred Stock issuable as provided in
this Warrant, that a new Warrant of like tenor and date for the balance of the
shares of Series D Preferred Stock issuable hereunder be delivered to the
undersigned.

-----------------------          (Name of Registered Owner)

-----------------------          (Signature of Registered owner)

-----------------------          (Street Address)

-----------------------          (City) (State) (Zip Code)

NOTICE:           The signature on this subscription must correspond with the
                  name as written upon the face of the within Warrant in
                  every particular, without alteration or enlargement or any
                  change whatsoever.



<PAGE>

                                    EXHIBIT B

                                 ASSIGNMENT FORM

                  FOR VALUE RECEIVED the undersigned registered owner of this
Warrant hereby sells, assigns and transfers unto the Assignee named below all of
the rights of the undersigned under this Warrant, with respect to the number of
shares of Series D Preferred Stock set forth below:

Name and Address of Assignee                    No. of Shares of Series D
Preferred Stock



and does hereby irrevocably constitute and appoint ____________ attorney-in-fact
to register such transfer on the books of AAMES FINANCIAL CORPORATION maintained
for the purpose, with full power of substitution in the premises.

Dated:
      ----------------------------

Name:
     -----------------------------

Signature:
          ------------------------

Witness:
        --------------------------

NOTICE:           The signature on this assignment must correspond
                  with the name as written upon the face of the within Warrant
                  in every particular, without alteration or enlargement or any
                  change whatsoever.