MEGO FINANCIAL CORP. ANNOUNCES ONE FOR SIX REVERSE STOCK SPLIT
Reiterates Expectation of Full Year Profitability

Press Release: Mego Financial Corp.

July 30, 1999
LAS VEGAS,NV-- Mego Financial Corp. (Nasdaq: MEGO) today announced a one for six reverse stock split of its Common Stock, par value $0.01, which is expected to become effective on September 2, 1999 with respect to shares of the Company's common stock outstanding as of that date. The action is subject to the approval of shareholders of record on August 6, 1999, and will be considered at a Special Meeting of shareholders to be held on September 2, 1999. The reverse split is being undertaken in order to meet the listing qualifications of the Nasdaq National Market system.

Jerome J. Cohen, President and Chief Executive Officer of Mego Financial, commented, ``The reverse split is an immediate action step intended to keep our place on the Nasdaq National Market. It is important to reiterate to our shareholders our strong belief that the Company has now achieved its planned operational and financial turnaround -- as evidenced by our recently reported fiscal third quarter and nine month results.

"Specifically, we reported a return to profitability for the quarter ended May 31, 1999, with net income of $1,143,000, or $0.05 per share compared to a net loss of $113,000, or $0.01 per share for the comparable period last year. The company's turnaround actually began in February of this year, and we are pleased to say that the upward trend has continued into the current fiscal fourth quarter. As a result, we expect to be profitable for the full year. Our recent results, and expected full year profitability are the direct result of our aggressive focus on expense controls, coupled with higher sales volume.''

Mr. Cohen continued, "Another factor which is expected to positively impact future profitability and shareholder value are the potential sales of several of our non-core assets located in fast-growing Pahrump, Nevada -- whose total book value is significantly less than their current values. These assets include the Central Nevada Utility Company, two golf courses and numerous major parcels of land. We expect a sale of at least one of these assets during calendar 1999.''

Mego Financial is a premier developer and operator of timeshare properties and a provider of consumer financing to purchasers of timeshare interests and land parcels through its wholly-owned subsidiary, Preferred Equities Corporation, established in 1970. Mego Financial is headquartered in Las Vegas, Nevada and has properties it operates under the banner of Ramada Vacation Suites in Nevada, New Jersey, Colorado, Florida, Hawaii and Louisiana. Mego Financial also owns Central Nevada Utilities, serving a large portion of the fast-growing Pahrump Valley, near Las Vegas.

This press release contains "forward-looking statements'' within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties or other factors which may cause actual results, performance or achievements of Mego Financial to be materially different from any future results, performance or achievements express or implied by such forward-looking statements. Factors that might cause such a difference, include, but are not limited to those discussed in the Management's Discussion and Analysis of Financial Condition and Results of Operations in Mego Financial's Annual Report on Form 10-K for the year ended August 31, 1998, and in documents subsequently filed by Mego Financial with the Securities and Exchange Commission.