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                                                                  EXHIBIT 10.29


                          AAMES FINANCIAL CORPORATION,
                                     ISSUER


                            THE SUBSIDIARY GUARANTORS


                                       AND


                            THE CHASE MANHATTAN BANK
                                     TRUSTEE


                          SECOND SUPPLEMENTAL INDENTURE
                          DATED AS OF FEBRUARY 10, 1999


                                   ----------


                                  $150,000,000
                          9.125% SENIOR NOTES DUE 2003


            Supplementing the Indenture dated as of October 21, 1996
                 between Aames Financial Corporation, as Issuer,
  and The Chase Manhattan Bank, as Trustee, as amended and supplemented to date





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        THIS SECOND SUPPLEMENTAL INDENTURE (the "Second Supplemental
Indenture"), dated as of February 10, 1999 among AAMES FINANCIAL CORPORATION, a
Delaware corporation (the "Company"), the SUBSIDIARY GUARANTORS listed on the
signature page hereto (the "Subsidiary Guarantors") and THE CHASE MANHATTAN
BANK, a New York banking corporation, as Trustee (the "Trustee"), to the
Indenture dated as of October 21, 1996 (the "Original Indenture"), as amended
and supplemented by a First Supplemental Indenture dated as of October 21, 1996
(the "First Supplemental Indenture") (the Original Indenture as so amended and
supplemented by the First Supplemental Indenture, the "Indenture").

                                   WITNESSETH:

        WHEREAS, the Company has issued its 9.125% Senior Notes Due 2003 (the
"Securities") pursuant to the Indenture;

        WHEREAS, the Company has entered into a Preferred Stock Purchase
Agreement dated as of December 23, 1998 (the "Preferred Stock Purchase
Agreement") with Capital Z Financial Services Fund II, L.P., a Bermuda limited
partnership ("Capital Z"), pursuant to which and subject to the terms and
conditions thereof, Capital Z will make an equity investment in the Company of
up to $100 million. The Preferred Stock Purchase Agreement provides, among other
things, for (i) the investment of $75 million through the purchase by Capital Z
or its designees of newly designated Series B Convertible Preferred Stock (the
"Series B Stock") of the Company and newly designated Series C Convertible
Preferred Stock of the Company (the "Series C Stock") in a private placement
transaction (the "Initial Closing"); (ii) after the Initial Closing and
completion of a recapitalization of the Company, an offering to the Company's
stockholders of non-transferable rights to purchase up to $25 million of Series
C Stock; and (iii) the sale to Capital Z or its designees of any and all shares
of Series C Stock not purchased by the Company's stockholders in such rights
offering (the transactions referred to in clauses (i), (ii) and (iii) are
collectively referred to as the "Preferred Stock Issuance").

        WHEREAS, the Company has solicited the consent of the registered holders
(the "Holders") of the Securities as of January 11, 1999, the record date set by
the Company, to (i) waive the obligation of the Company upon the change of
control resulting from the Preferred Stock Issuance under Section 5.14 of the
Indenture to purchase any or all of the Securities at 101% of principal amount,
plus accrued and unpaid interest to the date of repurchase to facilitate the
Preferred Stock Issuance (the "Change of Control Waiver") and (ii) waive the
requirement in the definition thereof that "Consolidated Net Worth" be based on
the balance sheet for the most recent fiscal quarter to allow for immediate
recognition, when made at the Initial Closing, of the $75 million investment by
Capital Z under the Preferred Stock Purchase Agreement in Series B Stock and
Series C Stock as an addition to the Company's Consolidated Net Worth as of
December 31, 1998 (the "Net Worth Definition Waiver").

        WHEREAS, the Trustee has received evidence satisfactory to it of the
consent of the Holders of at least a majority in principal amount of the
Securities outstanding which are not owned by the Company or its affiliates to
the Change of Control Waiver and to the Net Worth Definition Waiver pursuant to
Section 9.02 of the Indenture.

        NOW, THEREFORE, intending to be legally bound hereby, the parties agree
as follows. Capitalized terms used herein and not otherwise defined shall have
the meanings assigned to them in the Indenture.




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                                    ARTICLE I
                            CHANGE OF CONTROL WAIVER

        All Holders and every subsequent holder of the Securities shall be bound
by the following waiver of the Indenture and the Securities:

        Such persons expressly waive the applicability of Section 5.14 of the
Indenture to the change of control resulting from the Preferred Stock Issuance
under the Preferred Stock Purchase Agreement, including any obligation on the
part of the Company to offer to repurchase any or all of the Securities at 101%
of the principal amount, together with accrued and unpaid interest, as a result
of the change of control resulting from the Preferred Stock Issuance.

                                   ARTICLE II
                           NET WORTH DEFINITION WAIVER

        All Holders and every subsequent holder of the Securities shall be bound
by the following waiver of the Indenture and the Securities:

        Such persons expressly waive the requirement in the definition thereof
that "Consolidated Net Worth" be based on the balance sheet for the most recent
fiscal quarter to allow for immediate recognition, when made at the Initial
Closing, of the $75 million investment in Series B Stock and Series C Stock
under the Preferred Stock Purchase Agreement as an addition to the Company's
Consolidated Net Worth as of December 31, 1998.

                                   ARTICLE III
                                  MISCELLANEOUS

        Section 3.1 Except as waived hereby, all of the terms of the Indenture
shall remain and continue in full force and effect and are hereby confirmed in
all respects.

        Section 3.2 This Second Supplemental Indenture and each and every
provision hereof shall be deemed to be a contract made under the laws of the
State of New York and for all purposes shall be construed in accordance with the
laws of such State.

        Section 3.3 This Second Supplemental Indenture may be executed in any
number of counterparts, each of which shall be an original; but such
counterparts shall constitute but one and the same instrument.

        Section 3.4 In entering into this Second Supplemental Indenture, the
Trustee shall be entitled to the benefit of every provision of the Indenture
relating to the conduct or affecting the liability of or affording protection to
the Trustee, whether or not elsewhere herein so provided.

                            [Signature page follows]




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        IN WITNESS WHEREOF, the parties hereto have caused this Second
Supplemental Indenture to be duly executed, and their respective corporate seals
to be hereunto affixed and attested, all as of the date hereof.

AAMES FINANCIAL CORPORATION            OXFORD AVIATION CORPORATION, INC.



By:       /s/ Barbara S. Polsky        By:    /s/ Barbara S. Polsky
   -------------------------------        --------------------------------------
   Name:  Barbara S. Polsky               Name:  Barbara S. Polsky
   Title: Executive Vice President        Title: Executive Vice President

AAMES CAPITAL CORPORATION              ROSSMORE FINANCIAL INSURANCE
                                       SERVICES, INC.



By:     /s/ Barbara S. Polsky          By:    /s/ Barbara S. Polsky
   -------------------------------        --------------------------------------
   Name:  Barbara S. Polsky               Name:  Barbara S. Polsky
   Title: Executive Vice President        Title: Executive Vice President

AAMES FUNDING CORPORATION              SERRANO INSURANCE SERVICES, INC.



By:     /s/ Barbara S. Polsky          By:    /s/ Barbara S. Polsky
   -------------------------------        --------------------------------------
   Name:  Barbara S. Polsky               Name:  Barbara S. Polsky
   Title: Executive Vice President        Title: Executive Vice President

ONE STOP MORTGAGE, INC.                WINDSOR MANAGEMENT CO.



By:     /s/ Barbara S. Polsky          By:    /s/ Barbara S. Polsky
   -------------------------------        --------------------------------------
   Name:  Barbara S. Polsky               Name:  Barbara S. Polsky
   Title: Executive Vice President        Title: Executive Vice President

THE CHASE MANHATTAN BANK, as trustee



By:        /s/  Susan Lai
   ------------------------------
   Name:  Susan Lai
   Title: Trust Officer