EXHIBIT A

CALIFORNIA INVESTMENT FUND, LLC
550 West C Street, 10th Floor
San Diego, CA 92101

October 22, 2000

CONFIDENTIAL
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The Board of Directors of Dynex Capital, Inc.
c/o Thomas H. Potts
President
Dynex Capital, Inc.
4551 Cox Road, Suite 300
Glen Allen, VA 23060

Re: Dynex Capital, Inc.
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Gentlemen:

Reference is hereby made to that certain letter of intent (the "Letter
of Intent"), dated September 29, 2000, between California Investment Fund,
LLC ("CIF") and Dynex Capital, Inc. ("Dynex"). Each of CIF and Dynex agrees
that (i) the Letter of Intent is hereby amended to extend the "No-Shop
Period" thereunder until October 27, 2000 and (ii) the provisions of the
Letter of Intent (including, without limitation, the obligations of the
parties under Sections 1 and 6), as amended hereby, remain in full force
and effect.

Very truly yours,

CALIFORNIA INVESTMENT FUND, LLC


By: /s/ Michael R. Kelly
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Name: Michael R. Kelly

Agreed to and Accepted this
22nd day of October, 2000

DYNEX CAPITAL, INC.


By: /s/ Thomas H. Potts
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Name: Thomas H. Potts
Title: President