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                                                                     EXHIBIT 4.7



                           AAMES FINANCIAL CORPORATION
                          REGISTRATION RIGHTS AGREEMENT

               REGISTRATION RIGHTS AGREEMENT, dated as of December 23, 1998,
among Capital Z Financial Services Fund II, L.P. ("Capital Z"), together with
the other investors listed on Schedule I hereto (collectively, the "Investors"),
and Aames Financial Corporation, a Delaware corporation (the "Company").

                                 R E C I T A L S

               WHEREAS, the Investors, pursuant to the terms of a Preferred
Stock Purchase Agreement, dated as of the date hereof, between Capital Z and the
Company (the "Purchase Agreement"), (i) have agreed to purchase shares of Series
B Convertible Preferred Stock, par value $0.001 per share, of the Company (the
"Series B Preferred Stock") and Series C Convertible Preferred Stock, par value
$0.001 per share, of the Company (the "Series C Preferred Stock" and, together
with the Series B Preferred Stock, the "Preferred Stock"), (ii) have received on
the date hereof warrants (the "Warrants") to purchase an aggregate of 1,250,000
shares of Common Stock, par value $0.001 per share (the "Common Stock"), of the
Company, and (iii) are to receive additional Common Stock purchase warrants (the
"Contingent Warrants" and, together with the Warrants, the "Investor Warrants")
on the Initial Closing Date (as defined in the Purchase Agreement); and

               WHEREAS, the Company has agreed, as a condition precedent to
Capital Z's obligations under the Purchase Agreement to grant the Investors
certain registration rights; and

               WHEREAS, the Company and the Investors desire to define the
registration rights of the Investors on the terms and subject to the conditions
herein set forth.

               NOW, THEREFORE, in consideration of the foregoing premises and
for other good and valuable consideration, the parties hereby agree as follows:

               1. DEFINITIONS

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

               Commission: shall mean the Securities and Exchange Commission or
any other federal agency at the time administering the Securities Act;



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               Conversion Shares: shall mean the shares of Common Stock for
which the Preferred Stock has been, or may be, converted.

               Exchange Act: shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder;

               Holder: shall mean any holder of Registrable Securities;

               Initiating Holder: shall mean (a) Capital Z or (b) any Holder or
Holders of Registrable Securities aggregating at least 35% of (i) the aggregate
number of shares of Preferred Stock held by all Holders, in the case of any
registration of Preferred Stock, or (ii) the aggregate number of Conversion
Shares and Warrant Shares held by all Holders, in the case of any registration
of Conversion Shares or Warrant Shares (x) held by such Holders or (y) issued or
issuable upon conversion of the Preferred Stock or exercise of the Investor
Warrants;

               Person: shall mean an individual, partnership, joint-stock
company, corporation, limited liability company, trust or unincorporated
organization, and a government or agency or political subdivision thereof;

               register, registered and registration: shall mean a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act (and any post-effective amendments filed or required to be filed)
and the declaration or ordering of effectiveness of such registration statement;

               Registrable Securities: (A) the shares of Preferred Stock issued
to the Investors pursuant to the Purchase Agreement, (B) the Warrant Shares, (C)
the Conversion Shares, (D) any additional shares of Common Stock or Preferred
Stock acquired by the Investors (but not their assignees, unless any such
assignee shall have acquired at least a number of Preferred Stock or Conversion
Shares equal to 15% of the shares of Preferred Stock or Conversion Shares
originally issued to the Investors pursuant to the Purchase Agreement, adjusted
for splits, combinations, and similar events), (E) any capital stock of the
Company issued as a dividend or other distribution with respect to, or in
exchange for or in replacement of, the shares of Preferred Stock or Common Stock
referred to in clauses (A), (B), (C) or (D) above, until, in the case of any
such securities, (i) a registration statement covering such securities has been
declared effective by the Commission and such securities have been disposed of
pursuant to such effective Registration Statement or (ii) such securities have
been disposed of in open market transactions pursuant to Rule 144 under the
Securities Act (or similar rule then in effect);



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               Registration Expenses: shall mean (x) all expenses incurred by
the Company in compliance with Sections 2(a) and (b) hereof, excluding Selling
Expenses, but including, without limitation, all registration and filing fees,
printing expenses, blue sky fees and expenses and the expense of any special
audits incident to or required by any such registration (but excluding the
compensation of regular employees of the Company, which shall be paid in any
event by the Company) and (y) all reasonable fees and disbursements of one
counsel retained by the Holders of a majority of the Registrable Securities to
be included in a particular registration;

               Security, Securities: shall have the meaning set forth in Section
2(1) of the Securities Act;

               Securities Act: shall mean the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder;

               Selling Expenses: shall mean all underwriting and selling
discounts, fees and commissions applicable to the sale of Registrable
Securities; and

               Warrant Shares: shall mean the shares of Common Stock for which
the Investor Warrants have been, or may be, exercised.

               2. REGISTRATION RIGHTS

               (a) Requested Registration.

                   (i) Request for Registration. If the Company shall receive
        from an Initiating Holder, at any time, a written request that the
        Company effect any registration with respect to all or a part of the
        Registrable Securities, the Company will:

                       (A) promptly give written notice of the proposed
               registration, qualification or compliance to all other Holders;
               and

                       (B) as soon as reasonably practicable, use its reasonable
               best efforts to effect such registration (including, without
               limitation, the execution of an undertaking to file
               post-effective amendments, appropriate qualification under
               applicable blue sky or other state securities laws and
               appropriate compliance with applicable regulations issued under
               the Securities Act) as may be so requested and as would permit or
               facilitate the sale and distribution of all or such portion of
               such Registrable Securities as are specified in such request,
               together with all or such portion of the Registrable Securities
               of any Holder or Holders joining in such request as are specified
               in a written request received by the Company within 10 business
               days after written notice from the Company is given under



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               Section 2(a)(i)(A) above; provided that the Company shall not be
               obligated to effect, or take any action to effect, any such
               registration pursuant to this Section 2(a):

                       (v) in any particular jurisdiction in which the Company
               would be required to execute a general consent to service of
               process in effecting such registration, qualification or
               compliance, unless the Company is already subject to service in
               such jurisdiction and except as may be required by the Securities
               Act or applicable rules or regulations thereunder;

                       (w) (i) with respect to a request for registration of
               Warrant Shares or Conversion Shares, after the Company has
               effected five (5) such registrations pursuant to this Section
               2(a) requested by an Initiating Holder and (ii) with respect to a
               request for registration of shares of Preferred Stock, after the
               Company has effected five (5) such registrations pursuant to this
               Section 2(a) requested by an Initiating Holder, and, in each
               case, such registrations have been declared or ordered effective
               and the sales of such Registrable Securities shall have closed;

                       (x) if the Registrable Securities requested by all
               Holders to be registered pursuant to such request do not have an
               anticipated aggregate public offering price (before any
               underwriting discounts and commissions) of at least $10,000,000;
               or

                       (y) if at the time of any request to register Registrable
               Securities, the Company is engaged or intends to engage in an
               acquisition, financing or other material transaction which, in
               the good faith determination of the Board of Directors of the
               Company, would be adversely affected by the requested
               registration to the material detriment of the Company, or the
               Board of Directors of the Company determines in good faith that
               the registration would require the disclosure of material
               information that the Company has a bona fide business purpose for
               preserving as confidential, and that the Company is not otherwise
               required by applicable securities laws or regulations to
               disclose, in which event, the Company may, at its option, direct
               that such request be delayed for a period not in excess of ninety
               days from the date of the determination by the Board of
               Directors, as the case may be, such right to delay a request to
               be exercised by the Company not more than once in any
               twelve-month period.




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                       (z) with respect to Holders who are officers, directors
               or employees of the Company, if at the time of any request to
               register Registrable Securities, directors, officers, or
               employees of the Company are not permitted to offer or sell
               securities in accordance with the Company's policies.

               The registration statement filed pursuant to the request of an
Initiating Holder may, subject to the provisions of Section 2(a)(ii) below,
include other securities, other than Registrable Securities, of the Company
which are held by the other stockholders ("Other Stockholders") of the Company.

               The Holders holding a majority of the Registrable Securities
requested to be registered may, at any time prior to the effective date of the
registration statement relating to such registration, revoke such request,
without liability to the Company, such Holders, any of the other Holders or the
Other Stockholders, by providing a written notice to the Company revoking such
request, provided that such revoked request shall count against the
registrations available to the Holders pursuant to Section 2(a)(x) unless such
Holders pay the costs and expenses associated with such revoked request.

               Notwithstanding the foregoing provisions of this Section 2(a)(i),
if the Initial Closing (as defined in the Purchase Agreement) does not take
place for any reason whatsoever, the holder or holders of a majority of the
Warrants shall be entitled to one demand registration right with respect to the
Warrant Shares, subject to the other provisions of this Agreement.

                      (ii) Underwriting. If the Initiating Holders intend to
        distribute the Registrable Securities covered by their request by means
        of an underwriting, they shall so advise the Company as a part of their
        request made pursuant to Section 2(a). If shares held by Other
        Stockholders are requested by such Other Stockholders to be included in
        any registration pursuant to this Section 2, the Company shall condition
        such inclusion on their acceptance of the further applicable provisions
        of this Section 2. The Initiating Holders whose Registrable Securities
        are to be included in such registration and the Company shall (together
        with all Other Stockholders proposing to distribute their securities
        through such underwriting) enter into an underwriting agreement in
        customary form with the representative of the underwriter or
        underwriters selected for such underwriting by such Initiating Holders
        and reasonably acceptable to the Company. Notwithstanding any other
        provision of this Section 2(a), if the representative advises the
        Holders in writing that marketing factors (including, without
        limitation, pricing considerations) require a limitation on the number
        of shares to be underwritten or a limitation on the inclusion of shares
        held by directors and officers of



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        the Company, the securities of the Company held by Other Stockholders
        shall be excluded from such registration to the extent so required by
        such limitation. If, after the exclusion of such shares, further
        reductions are still required, the Registrable Securities of the Company
        held by each Holder other than the Initiating Holders shall be excluded
        from such registration to the extent so required by such limitation.
        Thereafter, if still further reductions are required, the number of
        Registrable Securities included in the registration by each Initiating
        Holder shall be reduced on a pro rata basis (based on the number of
        Registrable Securities held by such Initiating Holder), by such minimum
        number of Registrable Securities as is necessary to comply with such
        request. No Registrable Securities or any other securities excluded from
        the underwriting by reason of the underwriter's marketing limitation
        shall be included in such registration. If any Other Stockholder who has
        requested inclusion in such registration as provided above disapproves
        of the terms of the underwriting, such person may elect to withdraw
        therefrom by written notice to the Company, the underwriter and the
        Initiating Holders. The securities so withdrawn shall also be withdrawn
        from registration. If the underwriter has not limited the number of
        Registrable Securities or other securities to be underwritten, the
        Company and officers and directors of the Company (including
        representatives and designees of Capital Z or the Series B Preferred
        Stock holders) may include its or their securities for its or their own
        account in such registration if the representative so agrees and if the
        number of Registrable Securities and other securities which would
        otherwise have been included in such registration and underwriting will
        not thereby be limited.

                      (iii) Other Registration Rights. The Company shall not
        grant any registration rights inconsistent with the provisions of this
        Section 2(a) and in granting any demand registration rights hereafter
        shall provide that the Holders shall have the right to notice of the
        exercise of any such demand registration right and to participate in
        such registration on a pro rata basis.

               (b) Company Registration.

                      (i) If the Company shall determine to register any of its
        equity securities either for its own account or any Other Stockholders,
        other than a registration relating solely to employee benefit plans, or
        a registration relating solely to a Commission Rule 145 transaction, or
        a registration on any registration form which does not permit secondary
        sales or does not include substantially the same information as would be
        required to be included in a registration statement covering the sale of
        Registrable Securities, the Company will:




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                       (A) promptly give to each of the Holders a written notice
               thereof; and

                       (B) include in such registration (and any related
               qualification under blue sky laws or other compliance), and in
               any underwriting involved therein, all the Registrable Securities
               specified in a written request or requests, made by the Holders
               within fifteen (15) days after receipt of the written notice from
               the Company described in clause (A) above, except as set forth in
               Section 2(b)(ii) below.

        The Company may terminate, in its sole and absolute discretion, any
        registration described in this Section 2(b) at any time prior to the
        effectiveness of the applicable registration statement. Upon such
        termination, the Company's obligations under this Section 2(b) with
        respect to such terminated registration shall terminate.


                      (ii) Underwriting. If the registration of which the
        Company gives notice is for a registered public offering involving an
        underwriting, the Company shall so advise each of the Holders as a part
        of the written notice given pursuant to Section 2(b)(i)(A). In such
        event, the right of each of the Holders to registration pursuant to this
        Section 2(b) shall be conditioned upon such Holders' participation in
        such underwriting and the inclusion of such Holders' Registrable
        Securities in the underwriting to the extent provided herein. The
        Holders whose shares are to be included in such registration shall
        (together with the Company and the Other Stockholders distributing their
        securities through such underwriting) enter into an underwriting
        agreement in customary form with the representative of the underwriter
        or underwriters selected for underwriting by the Company.
        Notwithstanding any other provision of this Section 2(b), if the
        representative determines that marketing factors require a limitation on
        the number of shares to be underwritten or a limitation on the inclusion
        of shares held by directors and officers of the Company, the
        representative may (subject to the allocation priority set forth below)
        limit the number of Registrable Securities to be included in the
        registration and underwriting to not less than twenty five percent (25%)
        of the total number of shares to be included in such underwritten
        offering, subject to the Company's compliance with any registration
        obligations to any Demanding Holders (as hereinafter defined)
        participating in such registration. The Company shall so advise all
        holders of securities requesting registration, and the number of shares
        of securities that are entitled to be included in the registration and
        underwriting shall be allocated in the following manner: The securities
        of the Company held by officers, directors (including representatives
        and designees



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        of Capital Z or the Series B Preferred Stock holders) and Other
        Stockholders (other than Registrable Securities and other than
        securities held by holders who by contractual right demanded such
        registration ("Demanding Holders")) shall be excluded from such
        registration and underwriting to the extent required by such limitation,
        and, if a limitation on the number of shares is still required, the
        number of shares that may be included in the registration and
        underwriting by each of the Holders other than the Demanding Holders
        shall be excluded from such registration to the extent so required by
        such limitation. Thereafter, if still further reductions are required,
        the number of shares included in the registration by each of the
        Demanding Holders shall be reduced, on a pro rata basis (based on the
        number of shares held by such Demanding Holders), by such minimum number
        of shares as is necessary to comply with such limitation. If any of the
        Holders or any officer, director or Other Stockholder disapproves of the
        terms of any such underwriting, he may elect to withdraw therefrom by
        written notice to the Company and the underwriter. Any Registrable
        Securities or other securities excluded or withdrawn from such
        underwriting shall be withdrawn from such registration.

                      (iii) Number and Transferability. Each of the Holders
        shall be entitled to have its shares included in an unlimited number of
        registrations pursuant to this Section 2(b).

               (c) Shelf Registration.

                      (i) If requested by the Initiating Holder at any time
        after the date hereof, the Company shall file a "shelf" registration
        statement pursuant to Rule 415 (if then available) under the Securities
        Act (the "Shelf Registration") with respect to the resale of all or any
        portion of the Registrable Securities, as requested by the Initiating
        Holder. If such request is made, the Company shall (A) use its
        reasonable best efforts to have the Shelf Registration declared
        effective as promptly as practicable and (B) use its reasonable best
        efforts to keep the Shelf Registration continuously effective from the
        date such Shelf Registration is declared effective until the date
        specified in Section 2(i) in order to permit the prospectus forming a
        part thereof to be usable by Holders during such period. The Shelf
        Registration may not include other securities of the Company which are
        held by Other Stockholders.

                      (ii) The Company shall supplement or amend the Shelf
        Registration, (A) as required by the registration form utilized by the
        Company or by the instructions applicable to such registration form or
        by the Securities Act or the rules and regulations promulgated
        thereunder, (B) to include in such Shelf Registration any additional
        securities that become Registrable Securities by operation of the
        definition



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        thereof and (C) following the written request of an Initiating Holder
        pursuant to Section 2(c)(iii) below, to cover offers and sales of all or
        a part of the Registrable Securities by means of an underwriting
        including the incorporation of any information required pursuant to
        Section 2(e)(x) below. The Company shall furnish to the Holders of the
        Registrable Securities to which the Shelf Registration relates copies of
        any such supplement or amendment sufficiently in advance (but in no
        event less than five business days in advance) of its use and/or filing
        with the Commission to allow the Holders a meaningful opportunity to
        comment thereon.

                      (iii) The Holders may, at their election and upon written
        notice by the Initiating Holders to the Company, effect offers and sales
        under the Shelf Registration by means of one or more underwritten
        offerings, in which case the provisions of Section 2(a)(ii) above shall
        apply to any such underwritten distribution of securities under the
        Shelf Registration and such underwriting shall, if sales of Registrable
        Securities pursuant thereto shall have closed, be regarded as the
        exercise of one of the registration rights contemplated by Section 2(a)
        hereof.

                      (iv) The rights of the Holders to request and effect a
        Shelf Registration hereunder and the Company's obligations to keep a
        Shelf Registration effective shall be subject to the restrictions and
        limitations set forth in Section 2(a)(x), (y) and (z).

               (d) Expenses of Registration. All Registration Expenses incurred
in connection with any registration, qualification or compliance pursuant to
this Section 2 (including all Registration Expenses incurred in connection with
the Shelf Registration and any supplements or amendments thereto, whether or not
it becomes effective, and whether all, none or some of the Registrable
Securities are sold pursuant to the Shelf Registration) shall be borne by the
Company, and all Selling Expenses shall be borne by the Holders of the
securities so registered pro rata on the basis of the number of their shares so
registered; provided, however, that if, as a result of the withdrawal of a
request for registration by any of the Holders, as applicable, the registration
statement does not become effective, the Holders and Other Stockholders
requesting registration may elect to bear the Registration Expenses (pro rata on
the basis of the number of their shares so included in the registration request,
or on such other basis as such Holders and Other Stockholders may agree), in
which case such registration shall not be counted as a registration pursuant to
Section 2(a)(i)(B)(x).

               (e) Registration Procedures. In the case of each registration
 effected by the Company pursuant to this Section 2, the Company will keep the
 Holders holding Registrable Securities



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        requested to be included in such registration ("Participating Holders")
        advised in writing as to the initiation of each registration and as to
        the completion thereof. At its expense, the Company will:

                     (i) other than the Shelf Registration, the obligations in
        respect of which are set forth in Section 2(c)(i)(B) above, keep such
        registration effective for a period of one hundred eighty (180) days or
        until the Participating Holders, as applicable, have completed the
        distribution described in the registration statement relating thereto,
        whichever first occurs;

                      (ii) furnish to each Participating Holder, and to any
        underwriter before filing with the Commission, copies of any
        registration statement (including all exhibits) and any prospectus
        forming a part thereof and any amendments and supplements thereto
        (including, upon request, all documents incorporated or deemed
        incorporated by reference therein) prior to the effectiveness of such
        registration statement and including each preliminary prospectus, any
        summary prospectus or any term sheet (as such term is used in Rule 434
        under the Securities Act)) and any other prospectus filed under Rule 424
        under the Securities Act, which documents, other than exhibits and
        documents incorporated or deemed incorporated by reference, will be
        subject the review of the Participating Holders and any such underwriter
        for a period of at least five business days, and the Company shall not
        file any such registration statement or such prospectus or any amendment
        or supplement to such registration statement or prospectus to which any
        Participating Holder or any such underwriter shall reasonably object
        within five business days after the receipt thereof; a Participating
        Holder or such underwriter(s), if any, shall be deemed to have
        reasonably objected to such filing only if the registration statement,
        amendment, prospectus or supplement, as applicable, as proposed to be
        filed, contains a material misstatement or omission;

                      (iii) furnish to each Participating Holder and to any
        underwriter, such number of conformed copies of the applicable
        registration statement and of each amendment and supplement thereto (in
        each case including all exhibits) and such number of copies of the
        prospectus forming a part of such registration statement (including each
        preliminary prospectus, any summary prospectus or any term sheet (as
        such term is used in Rule 434 under the Securities Act)) and any other
        prospectus filed under Rule 424 under the Securities Act, in conformity
        with the requirements of the Securities Act, and such other documents,
        including without limitation documents incorporated or deemed to be
        incorporated by reference prior to the effectiveness of such
        registration, as each of the Participating Holders or any such
        underwriter, from time to time may reasonably request;




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                      (iv) to the extent practicable, promptly prior to the
        filing of any document that is to be incorporated by reference into any
        registration statement or prospectus forming a part thereof subsequent
        to the effectiveness thereof, and in any event no later than the date
        such document is filed with the Commission, provide copies of such
        document to the Participating Holders, if requested, and to any
        underwriter, make representatives of the Company available for
        discussion of such document and other customary due diligence matters;

                      (v) make available at reasonable times for inspection by
        the Participating Holders, any underwriter participating in any
        disposition pursuant to such registration and any attorney or accountant
        retained by the Holders or any such underwriter, all financial and other
        records, pertinent corporate documents and properties of the Company and
        cause the officers, directors and employees of the Company to supply all
        information reasonably requested by the Participating Holders and any
        such underwriters, attorneys or accountants in connection with such
        registration subsequent to the filing of the applicable registration
        statement and prior to the effectiveness of the applicable registration
        statement, subject to the execution of a customary confidentiality
        agreement;

                      (vi) use its reasonable best efforts (x) to register or
        qualify all Registrable Securities and other securities covered by such
        registration under such other securities or blue sky laws of such States
        of the United States of America where an exemption is not available and
        as the sellers of Registrable Securities covered by such registration
        shall reasonably request, (y) to keep such registration or qualification
        in effect for so long as the applicable registration statement remains
        in effect, and (z) to take any other action which may be reasonably
        necessary or advisable to enable such sellers to consummate the
        disposition in such jurisdictions of the securities to be sold by such
        sellers, except that the Company shall not for any such purpose be
        required to qualify generally to do business as a foreign corporation in
        any jurisdiction where it is not so qualified, or to subject itself to
        taxation in any such jurisdiction, or to execute a general consent to
        service of process in effecting such registration, qualification or
        compliance, unless the Company is already subject to service in such
        jurisdiction and except as may be required by the Securities Act or
        applicable rules or regulations thereunder;

                      (vii) use its reasonable best efforts to cause all
        Registrable Securities covered by such registration statement to be
        registered with or approved by such other federal or state governmental
        agencies or authorities as may be necessary in the opinion of counsel to
        the Company and



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        counsel to the Participating Holders of Registrable Securities to enable
        the Holders thereof to consummate the disposition of such Registrable
        Securities in accordance with the plan of distribution described in the
        applicable registration statement;

                      (viii) subject to Section 2(i) hereof, promptly notify
        each Holder of Registrable Securities covered by a registration
        statement (A) upon discovery that, or upon the happening of any event as
        a result of which, the prospectus forming a part of such registration
        statement, as then in effect, includes an untrue statement of a material
        fact or omits to state any material fact required to be stated therein
        or necessary to make the statements therein, in the light of the
        circumstances under which they were made, not misleading, (B) of the
        issuance by the Commission of any stop order suspending the
        effectiveness of such registration statement or the initiation of
        proceedings for that purpose, (C) of any request by the Commission for
        (1) amendments to such registration statement or any document
        incorporated or deemed to be incorporated by reference in any such
        registration statement, (2) supplements to the prospectus forming a part
        of such registration statement or (3) additional information, (D) of the
        receipt by the Company of any notification with respect to the
        suspension of the qualification or exemption from qualification of any
        of the Registrable Securities for sale in any jurisdiction or the
        initiation of any proceeding for such purpose, and at the request of any
        such Holder promptly prepare and furnish to it a reasonable number of
        copies of a supplement to or an amendment of such prospectus as may be
        necessary so that, as thereafter delivered to the purchasers of such
        securities, such prospectus shall not include an untrue statement of a
        material fact or omit to state a material fact required to be stated
        therein or necessary to make the statements therein, in the light of the
        circumstances under which they were made, not misleading;

                      (ix) use its reasonable best efforts to obtain the
        withdrawal of any order suspending the effectiveness of any such
        registration, or the lifting of any suspension of the qualification (or
        exemption from qualification) of any of the Registrable Securities for
        sale in any jurisdiction;

                      (x) if requested by a Participating Holder, or any
        underwriter, subject to receipt of any required information from such
        Holder or underwriter, promptly incorporate in such registration
        statement or prospectus, pursuant to a supplement or post-effective
        amendment if necessary, such information as the Participating Holder and
        any underwriter may reasonably request to have included therein,
        including, without limitation, information relating to the "plan of
        distribution" of the Registrable Securities, information with respect to
        the number of shares of



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        Registrable Securities being sold to such underwriter, the purchase
        price being paid therefor and any other terms of the offering of the
        Registrable Securities to be sold in such offering and make all required
        filings of any such prospectus supplement or post-effective amendment as
        soon as practicable after the Company is notified of the matters to be
        incorporated in such prospectus supplement or post-effective amendment;

                      (xi) furnish to the Participating Holders, addressed to
        them, an opinion of counsel for the Company, dated the date of the
        closing under the underwriting agreement, if any, or the date of
        effectiveness of the registration statement if such registration is not
        an underwritten offering, and use its reasonable best efforts to furnish
        to the Participating Holders, addressed to them, a "cold comfort" letter
        signed by the independent certified public accountants who have
        certified the Company's financial statements included in such
        registration, covering substantially the same matters with respect to
        such registration (and the prospectus included therein) and, in the case
        of such accountants' letter, with respect to events subsequent to the
        date of such financial statements, as are customarily covered in
        opinions of issuer's counsel and in accountants' letters delivered to
        underwriters in underwritten public offerings of securities and such
        other matters as the Participating Holders may reasonably request;

                      (xii) provide promptly to the Participating Holders upon
        request any document filed by the Company with the Commission pursuant
        to the requirements of Section 13 and Section 15 of the Exchange Act;
        and

                      (xiii) use its reasonable best efforts to cause all
        Registrable Securities included in any registration pursuant hereto to
        be listed on each securities exchange on which securities of the same
        class are then listed or, if not then listed on any securities exchange,
        to be eligible for trading in any over-the-counter market or trading
        system in which securities of the same class are then traded.

               (f)  Indemnification.

                      (i) The Company will indemnify each of the Holders, as
        applicable, each of its officers, directors and partners, and each
        person controlling each of the Holders (within the meaning of the
        Securities Act), with respect to each registration which has been
        effected pursuant to this Section 2, and each underwriter, if any, and
        each person who controls any underwriter, against all claims, losses,
        damages and liabilities (or actions in respect thereof) arising out of
        or based on any untrue statement (or alleged untrue statement) of a
        material fact contained in any preliminary, final or summary prospectus,
        offering circular



                                       13
<PAGE>   14


        or other document (including any related registration statement,
        notification or the like, or any amendment or supplement to any of the
        foregoing) incident to any such registration, qualification or
        compliance, or based on any omission (or alleged omission) to state
        therein a material fact required to be stated therein or necessary to
        make the statements therein not misleading, or any violation (or alleged
        violation) by the Company of the Securities Act or the Exchange Act or
        any rule or regulation thereunder or of any applicable state or common
        law applicable to the Company and relating to action or inaction
        required of the Company in connection with any such registration,
        qualification or compliance, and (subject to Section 2(f)(iii)) will
        reimburse each of the Holders, each of its officers, directors and
        partners, and each person controlling each of the Holders, each such
        underwriter and each person who controls any such underwriter, for any
        legal and any other expenses reasonably incurred in connection with
        investigating and defending any such claim, loss, damage, liability or
        action, provided that the Company will not be liable in any such case to
        the extent that any such claim, loss, damage, liability or expense
        arises out of or is based on any untrue statement or omission based upon
        and in conformity with written information furnished to the Company by
        the Holders or underwriter and stated to be specifically for use
        therein. The foregoing indemnification shall remain in effect regardless
        of any investigation by any indemnified party and shall survive any
        transfer or assignment by a Holder of its Registrable Securities or of
        its rights pursuant to this Agreement.

                      (ii) Each of the Holders will, if Registrable Securities
        held by it are included in the securities as to which such registration,
        qualification or compliance is being effected, indemnify on a several,
        but not joint basis, the Company, each of its directors and officers and
        each underwriter, if any, of the Company's securities covered by such a
        registration statement, each person who controls the Company or such
        underwriter, each Other Stockholder and each of their officers,
        directors, and partners, and each person controlling such Other
        Stockholder against all claims, losses, damages and liabilities (or
        actions in respect thereof) arising out of or based on any untrue
        statement (or alleged untrue statement) made by such Holder of a
        material fact contained in any such registration statement, prospectus,
        offering circular or other document, or any omission (or alleged
        omission) made by such Holder to state therein a material fact required
        to be stated therein or necessary to make the statements therein not
        misleading, and will reimburse the Company and such directors, officers,
        partners, persons, underwriters or control persons for any legal or any
        other expenses reasonably incurred in connection with investigating or
        defending any such claim, loss, damage, liability or action, in each
        case to the



                                       14
<PAGE>   15


        extent, but only to the extent, that such untrue statement (or alleged
        untrue statement) or omission (or alleged omission) is made in such
        registration statement, prospectus, offering circular or other document
        in reliance upon and in conformity with written information furnished to
        the Company by such Holder and stated to be specifically for use
        therein; provided, however, that the obligations of each of the Holders
        hereunder shall be limited to an amount equal to the net proceeds to
        such Holder of securities sold pursuant to such registration statement
        or prospectus.

                      (iii) Each party entitled to indemnification under this
        Section 2(f) (the "Indemnified Party") shall give notice to the party
        required to provide indemnification (the "Indemnifying Party") promptly
        after such Indemnified Party has actual knowledge of any claim as to
        which indemnity may be sought, and shall permit the Indemnifying Party
        to assume the defense of any such claim or any litigation resulting
        therefrom; provided that counsel for the Indemnifying Party, who shall
        conduct the defense of such claim or any litigation resulting therefrom,
        shall be approved by the Indemnified Party (whose approval shall not
        unreasonably be withheld) and the Indemnified Party may participate in
        such defense at such party's expense (unless the Indemnified Party shall
        have reasonably concluded upon advice from counsel that there may be a
        conflict of interest between the Indemnifying Party and the Indemnified
        Party in such action, in which case the reasonable fees and expenses of
        one firm of counsel (and one local counsel) shall be at the expense of
        the Indemnifying Party), and provided further that the failure of any
        Indemnified Party to give notice as provided herein shall not relieve
        the Indemnifying Party of its obligations under this Section 2 except to
        the extent the Indemnifying Party is materially prejudiced thereby. No
        Indemnifying Party, in the defense of any such claim or litigation
        shall, except with the consent of each Indemnified Party, consent to
        entry of any judgment or enter into any settlement which does not
        include as an unconditional term thereof the giving by the claimant or
        plaintiff to such Indemnified Party of a release from all liability in
        respect to such claim or litigation. Each Indemnified Party shall
        promptly furnish such information regarding itself or the claim in
        question as an Indemnifying Party may reasonably request in writing and
        as shall be reasonably required in connection with the defense of such
        claim and litigation resulting therefrom.

                      (iv) If the indemnification provided for in this Section
        2(f) is held by a court of competent jurisdiction to be unavailable to
        an Indemnified Party with respect to any loss, liability, claim, damage
        or expense referred to herein, then the Indemnifying Party, in lieu of
        indemnifying such Indemnified Party hereunder, shall contribute to the
        amount paid or payable by such Indemnified Party as a result



                                       15
<PAGE>   16


        of such loss, liability, claim, damage or expense in such proportion as
        is appropriate to reflect the relative fault of the Indemnifying Party
        on the one hand and of the Indemnified Party on the other in connection
        with the statements or omissions which resulted in such loss, liability,
        claim, damage or expense, as well as any other relevant equitable
        considerations, provided, however, that no Person guilty of fraudulent
        misrepresentation (within the meaning of Section 11(f) of the Securities
        Act) shall be entitled to contribution from any Person who was not
        guilty of any such fraudulent misrepresentation. The relative fault of
        the Indemnifying Party and of the Indemnified Party shall be determined
        by reference to, among other things, whether the untrue (or alleged
        untrue) statement of a material fact or the omission (or alleged
        omission) to state a material fact relates to information supplied by
        the Indemnifying Party or by the Indemnified Party and the parties'
        relative intent, knowledge, access to information and opportunity to
        correct or prevent such statement or omission. Notwithstanding the
        foregoing, no Holder will be required to contribute any amount pursuant
        to this paragraph (f) in excess of the total price at which the
        Registrable Securities of such Holder were offered to the public (less
        underwriting discounts and commissions, if any). Each Holder's
        obligations to contribute pursuant to this paragraph are several in the
        proportion that the proceeds of the offering received by such Holder
        bears to the total proceeds of the offering received by all the
        applicable Holders and not joint.

                      (v) The foregoing indemnity agreement of the Company and
        Holders is subject to the condition that, insofar as they relate to any
        loss, claim, liability or damage made in a prospectus, preliminary
        prospectus or other offering document but eliminated or remedied in an
        amended prospectus, preliminary prospectus or other offering document
        delivered to an underwriter or Holder, as applicable (the "Final
        Prospectus"), such indemnity agreement shall not inure to the benefit of
        (A) any underwriter if a copy of the Final Prospectus was furnished to
        the underwriter and was not furnished to the person asserting the loss,
        liability, claim or damage at or prior to the time such action is
        required by the Securities Act or (B) in circumstances where no
        underwriter is acting as such in the offer and sale in question, any
        Holder who (1) either directly or through its agent provided the
        preliminary prospectus to the Person asserting the loss, liability,
        claim or damage, (2) was furnished with a copy of the Final Prospectus,
        and (3) did not furnish or cause to be furnished the Final Prospectus to
        the Person asserting the loss, liability, claim or damage at or prior to
        the time such action is required by the Securities Act.



                                       16
<PAGE>   17


                      (vi) Any indemnification payments required to be made to
        an Indemnified Party under this Section 2(f) shall be made as the
        related claims, losses, damages, liabilities or expenses are incurred.

               (g) Information by the Holders. Each of the Holders holding
securities included in any registration shall furnish to the Company such
information regarding such Holder and the distribution proposed by such Holder
as the Company may reasonably request in writing and as shall be reasonably
required in connection with any registration, qualification or compliance
referred to in this Section 2. No Investor shall be required, in connection with
any underwriting agreements entered into in connection with any registration, to
provide any information, representations or warranties, or covenants with
respect to the Company, its business or its operations, and such Investors shall
not be required to provide any indemnification with respect to any registration
statement except as specifically provided for in Section 2(f)(ii) hereof.

               (h) Rule 144 Reporting.

               With a view to making available the benefits of certain rules and
regulations of the Commission which may permit the sale of restricted securities
to the public without registration, the Company agrees to:

                      (i) make and keep public information available as those
        terms are understood and defined in Rule 144 under the Securities Act
        ("Rule 144"), at all times;

                      (ii) use its best efforts to file with the Commission in a
        timely manner all reports and other documents required of the Company
        under the Securities Act and the Exchange Act; and

                      (iii) so long as the Holder owns any Registrable
        Securities, furnish to the Holder upon request, a written statement by
        the Company as to its compliance with the reporting requirements of Rule
        144 and of the Securities Act and the Exchange Act, a copy of the most
        recent annual or quarterly report of the Company, and such other reports
        and documents so filed as the Holder may reasonably request in availing
        itself of any rule or regulation of the Commission allowing the Holder
        to sell any such securities without registration.

               (i) Termination. The registration rights set forth in this
Section 2 shall not be available to any Holder if, in the opinion of counsel to
the Company, all of the Registrable Securities then owned by such Holder could
be sold in any 90-day period pursuant to Rule 144 (without giving effect to the
provisions of Rule 144(k)) or at such time that no Registrable Securities are
outstanding. The Company will arrange for a



                                       17
<PAGE>   18


provision to the transfer agent for such shares of an opinion of counsel in
connection with any such sale under Rule 144.

               (j) Assignment. The registration rights set forth in Section 2
hereof may be assigned, in whole or in part, to any transferee of Registrable
Securities (who shall be considered thereafter to be a Holder and shall be bound
by all obligations and limitations of this Agreement).

               (k) The Holders agree that, upon receipt of any notice from the
Company pursuant to Section 2(e)(viii), they shall immediately discontinue the
disposition of Registrable Securities pursuant to the registration statement
applicable to such Registrable Securities until they have received copies of the
amended or supplemented prospectus as described in Section 2(e)(viii). The
Holders shall destroy all copies in their possession of the registration
statement and related materials covering such Registrable Securities at the time
of receipt of the Company's notice.

        3. MISCELLANEOUS

               (a) Directly or Indirectly. Where any provision in this Agreement
refers to action to be taken by any Person, or which such Person is prohibited
from taking, such provision shall be applicable whether such action is taken
directly or indirectly by such Person.

               (b) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware applicable to
contracts made and to be performed entirely within such State.

               (c) Section Headings. The headings of the sections and
subsections of this Agreement are inserted for convenience only and shall not be
deemed to constitute a part thereof.

               (d)  Notices.

                    (i) All communications under this Agreement shall be in
        writing and shall be delivered by hand or by facsimile or mailed by
        overnight courier or by registered or certified mail, postage prepaid:

                       (A) if to the Company, to Aames Financial Corporation, 2
               California Plaza, 350 South Grand Avenue, Los Angeles, California
               90071, facsimile no. (323) 210-4537 or at such other address or
               facsimile number as it may have furnished in writing to the
               Investors;

                       (B) if to the Investors, at the address or facsimile
               number listed on Schedule I hereto, or at



                                       18
<PAGE>   19


        such other address or facsimile number as may have been furnished in
        writing to the Company.

                   (ii) Any notice so addressed shall be deemed to be given: if
        delivered by hand or facsimile, on the date of such delivery; if mailed
        by courier, on the first business day following the date of such
        mailing; and if mailed by registered or certified mail, on the third
        business day after the date of such mailing.

               (e) Reproduction of Documents. This Agreement and all documents
relating thereto, including, without limitation, any consents, waivers and
modifications which may hereafter be executed may be reproduced by the parties
hereto by any photographic, photostatic, microfilm, microcard, miniature
photographic or other similar process and the parties hereto may destroy any
original document so reproduced. The parties hereto agree and stipulate that any
such reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by the Investors in the
regular course of business) and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.

               (f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties.

               (g) Entire Agreement; Amendment and Waiver. This Agreement
constitutes the entire understanding of the parties hereto and supersedes all
prior understanding among such parties. This Agreement may be amended, and the
observance of any term of this Agreement may be waived, with (and only with) the
written consent of the Company and the Investors holding a majority of the then
outstanding Registrable Securities.

               (h) Severability. In the event that any part or parts of this
Agreement shall be held illegal or unenforceable by any court or administrative
body of competent jurisdiction, such determination shall not effect the
remaining provisions of this Agreement which shall remain in full force and
effect.

               (i) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.






                                       19
<PAGE>   20


                  IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first set forth above.


                                   AAMES FINANCIAL CORPORATION



                                   By  /s/ Barbara S. Polsky
                                       ----------------------------------------
 
                                       Name:  Barbara S. Polsky

                                       Title: Executive Vice President


                                   INVESTORS:

                                   CAPITAL Z FINANCIAL SERVICES FUND II, L.P.,
                                   By its General Partner

                                   CAPITAL Z PARTNERS, L.P.,
                                       By its General Partner

                                       CAPITAL Z PARTNERS, LTD.
     


                                       By: /s/ Adam M. Mizel
                                           ------------------------------------
                                           Name:  Adam M. Mizel
                                           Title: Partner

                                   CAPITAL Z MANAGEMENT, INC.



                                   By: /s/ Adam M. Mizel
                                       ----------------------------------------
                                       Name: Adam M. Mizel
                                       Title:  Partner





                                       20
<PAGE>   21


                                   SCHEDULE I

NAME AND ADDRESS OF INVESTORS:

Capital Z Financial Services Fund, L.P.
One Chase Manhattan Plaza
New York, New York  10005
Attention: David Spuria, Esq.

Capital Z Management Inc.
One Chase Manhattan Plaza
New York, New York 10005
Attention: David Spuria, Esq.

This schedule will be amended to include (i) Designated Purchasers under the
Preferred Stock Purchase Agreement and (ii) the designees of Capital Z who will
receive any of the Warrants.