[HAWTHORNE LOGO]

                     HAWTHORNE FINANCIAL CORPORATION



                               IMPORTANT
               ANNUAL MEETING ADJOURNED TO JUNE 12, 1995


Dear Stockholder:

     The Annual Meeting of Stockholders of Hawthorne Financial Corporation,
which was convened on May 22, 1995, has been adjourned to Monday, June 12, 1995
at 10:00 am at the Radisson Plaza Hotel in Manhattan Beach, California. The
meeting was adjourned in order to provide stockholders with additional time to
vote their shares.

     The overwhelming majority of votes received to date have been in favor of
all of the proposals. However, the favorable vote of a majority of all shares
eligible to vote is necessary in order to approve an amendment to the Company's
Certificate of Incorporation, such as that set forth in Proposal Number 2
described in the enclosed proxy statement. Our records indicate that we have not
yet received your proxy. Regardless of the number of shares you own, it is
important that they are represented and voted at the reconvened meeting. If a
broker holds shares for you, it is necessary for you to submit instructions to
your broker in order for the vote to be counted.

     FOR THE REASONS SET FORTH IN THE ENCLOSED PROXY STATEMENT, THE BOARD OF
DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE IN FAVOR OF THE AMENDMENT TO ARTICLE
FOURTH OF THE COMPANY'S CERTIFICATE OF INCORPORATION (PROPOSAL NUMBER 2).

    Please take a few moments to complete and sign the enclosed duplicate
proxy card and return it in the enclosed postage-paid envelope. All votes
must be received no later than the day of the reconvened meeting. Thank you
for your cooperation in this matter.

                              Sincerely,
                              /s/ Scott A. Braly
                              Scott A. Braly
                              President and C.E.O.


IMPORTANT: If you have any questions or need any assistance in voting your
shares or instructing your broker to do so, please telephone Tom Long, D.F.
King & Co., at (800)290-6432.


                   [Hawthorne Financial Corporation Letterhead]