Prospectus Supplement No.5
The Prospectus dated November 14, 1996 (the "Prospectus")
relating to the offer for resale of up to $115,000,000 aggregate
principal amount of 5.5% Convertible Subordinated Debentures due
2006 of Aames Financial Corporation (the "Company") and 4,107,142
shares of the common stock of the Company, par value $0.001 per
share, into which such Debentures are convertible is hereby
amended as follows:
(1) The fourth paragraph appearing on the cover page of the
Prospectus is deleted and replaced in its entirety as follows:
"The Debentures are general unsecured obligations of
the Company, subordinated to all existing and future Senior
Indebtedness (as defined herein), which at October 31, 1996
was approximately $256 million, including $23.0 million of
the Company's 10.5% Senior Notes due 2002, $150 million of
the Company's 9.125% Senior Notes due 2003 and Company
guarantees of approximately $82.9 million of warehouse
indebtedness outstanding on such date incurred by a wholly
owned subsidiary of the Company. See `Description of the
Debentures.' "
(2) The following entity is hereby named as a Selling
Security Holder as contemplated on page 33 of the Prospectus:
Selling Security Holder Principal Amount of Debentures
- ----------------------------- -------------------------------
BT Securities Corp. $1,000,000
130 Liberty Street
New York, NY 10006
BT Securities Corp. and its affiliates have in the past provided
to the Company and its subsidiaries trustee services
for which is has received customary fees and may in the future
provide such services as well as commercial banking services.
The date of this Prospectus Supplement is December 19, 1996.
