EXHIBIT 23.1

Published on July 18, 1997


Consent of Independent Auditors


Board of Directors
Dynex Capital, Inc.


We consent to the use of our report incorporated in the registration statement
on Form S-3 (Registration No. 333-10783) and to the reference to our firm under
the heading "Experts" in the prospectus.


KPMG PEAT MARWICK LLP


Richmond, Virginia
July 14, 1997