UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20459

                                   SCHEDULE TO

                             TENDER OFFER STATEMENT
                    UNDER SECTION 14(d)(1) OR 13(e)(1) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                               DYNEX CAPITAL, INC.
                       (NAME OF SUBJECT COMPANY (ISSUER))

                          DYNEX CAPITAL, INC. (OFFEROR)
 (NAME OF FILING PERSON (IDENTIFYING STATUS AS OFFEROR, ISSUER OR OTHER PERSON))

               SERIES A PREFERRED STOCK, PAR VALUE $0.01 PER SHARE
               SERIES B PREFERRED STOCK, PAR VALUE $0.01 PER SHARE
               SERIES C PREFERRED STOCK, PAR VALUE $0.01 PER SHARE
                         (TITLE OF CLASS OF SECURITIES)

                                  (26817Q 20 9)
                   (CUSIP NUMBER OF SERIES A PREFERRED STOCK)
                                  (26817Q 30 8)
                   (CUSIP NUMBER OF SERIES B PREFERRED STOCK)
                                  (26817Q 40 7)
                   (CUSIP NUMBER OF SERIES C PREFERRED STOCK)

                           THOMAS H. POTTS, PRESIDENT
                               DYNEX CAPITAL, INC.
                            4551 COX ROAD, SUITE 300
                           GLEN ALLEN, VIRGINIA 23060
                                 (804) 217-5800

           (NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO
          RECEIVE NOTICES AND COMMUNICATIONS ON BEHALF OF FILING PERSON
                              FILING THE STATEMENT)

                                    COPY TO:
                          ELIZABETH R. HUGHES, ESQUIRE
                         VENABLE, BAETJER & HOWARD, LLP
                         2010 CORPORATE RIDGE, SUITE 400
                                McLEAN, VA 22102
                                 (703) 760-1649

                            CALCULATION OF FILING FEE

        TRANSACTION VALUATION:                    AMOUNT OF FILING FEE:
             $25,999,435                                  $5,200

*CALCULATED  SOLELY FOR THE  PURPOSE OF  DETERMINING  THE AMOUNT OF FILING  FEE,
ASSUMING  THE  PURCHASE  OF 500,000  SHARES OF SERIES A  PREFERRED  STOCK AT THE
TENDER OFFER PRICE OF $12.24 PER SHARE, THE PURCHASE OF 730,250 SHARES OF SERIES
B  PREFERRED  STOCK AT THE  TENDER  OFFER  PRICE OF $12.50  PER  SHARE,  AND THE
PURCHASE OF 702,700 SHARES OF SERIES C PREFERRED STOCK AT THE TENDER OFFER PRICE
OF $15.30 PER SHARE.

        [ ] Check  box if any  part of the fee is  offset  as  provided  by Rule
      0-11(a)(2)  and  identify  the filing  with which the  offsetting  fee was
      previously  paid.  Identify the previous filing by registration  statement
      number, or the form or schedule and the date of its filing.

Amount Previously Paid: Not applicable  Form or Registration No.: Not applicable
Filing Party: Not applicable                              Filed: Not applicable

[ ] Check the box if the filing  relates  solely to  preliminary  communications
made before the commencement of a tender offer.

Check the  appropriate  boxes below to designate any  transactions  to which the
statement relates:

         [   ] third-party tender offer subject to Rule14d-1.

         [ X ] issuer tender offer subject to Rule 13e-4.

         [   ] going-private transaction subject to Rule13e-3.

         [   ] amendment to Schedule 13D under Rule 13d-2.

Check the following box if the filing is a final amendment reporting the results
of the tender offer: [ ]

         This Issuer Tender Offer  Statement on Schedule TO (this "Schedule TO")
relates to the offer by Dynex Capital,  Inc., a Virginia corporation  ("Dynex"),
to  purchase  shares of its Series A  preferred  stock (the  "Series A Preferred
Stock");  shares of its  Series B  preferred  stock  (the  "Series  B  Preferred
Stock"),  and shares of its Series C  preferred  stock (the  "Series C Preferred
Stock", and collectively,  the "Preferred Stock") all upon the terms and subject
to the  conditions  set forth in the Offer to  Purchase,  dated May 7, 2001 (the
"Offer to Purchase"),  and the related Letters of Transmittal (which, as amended
or supplemented from time to time, together  constitute the "Offer"),  copies of
which are  attached  as  Exhibits  (a)(1)(A),  (a)(1)(B)(i),  (a)(1)(B)(ii)  and
(a)(1)(B)(iii). Each share of Preferred Stock has a par value $0.01. Pursuant to
the Offer,  Dynex will  purchase up to 500,000  shares of its Series A Preferred
Stock at a  purchase  price of $12.24 per  share,  up to  730,250  shares of its
Series B  Preferred  Stock at a purchase  price of $12.50  per share,  and up to
702,700 shares of its Series C Preferred Stock at a purchase price of $15.30 per
share (or in each case such lesser number of shares as are properly tendered and
not properly  withdrawn).  The purchase  price per share is net to the seller in
cash,  without  interest  thereon.  This  Schedule TO is intended to satisfy the
reporting  requirements  of Rule  13e-4(c)(2) of the Securities  Exchange Act of
1934, as amended.  Pursuant to Rule 13e-4(f)(1)(ii),  the total number of shares
purchased  may be increased to 510,000  shares of Series A Preferred  Stock,  to
744,855  shares of Series B Preferred  Stock,  and to 716,754 shares of Series C
Preferred Stock.

         All information in the Offer to Purchase filed as Exhibit  (a)(1)(A) is
incorporated  by  reference  in answer to all of the items in this  Schedule  TO
except those items as to which information is specifically provided herein.

ITEM 12. EXHIBITS.

EXHIBIT
NUMBER          DESCRIPTION

(a)(1)(A)       Offer to Purchase dated May 7, 2001.

(a)(1)(B)(i)    Series A Preferred Stock Letter of Transmittal.

(a)(1)(B)(ii)   Series B Preferred Stock Letter of Transmittal.

(a)(1)(B)(iii)  Series C Preferred Stock Letter of Transmittal.

(a)(1)(C)       Notice of Guaranteed Delivery.

(a)(1)(D)       Letter to Brokers, Dealers, Commercial Banks, Trust Companies
                and Other Nominees May 7, 2001.

(a)(1)(E)       Letter to Clients from  Brokers,  Dealers,  Commercial  Banks,
                Trust Companies and other Nominees dated May 7, 2001.

(a)(1)(F)       Guidelines for Certification of Taxpayer Identification Number
                on Substitute Form W-9.

(a)(1)(G)       Press Release (incorporated by reference to Dynex Capital, Inc.
                Schedule TO filed with the Securities and Exchange Commission on
                April 30, 2001).

(a)(2)-(5)      Not applicable.

(b)             Not applicable.

(d)             Not applicable.

(e)             Not applicable.

(g)             Not Applicable.


                                    SIGNATURE

         After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.



                                        DYNEX CAPITAL, INC.



                                        By:  /s/ Thomas H. Potts
                                        ------------------------
                                         ........Thomas H. Potts
                                         ........President

Dated: May 7, 2001

INDEX TO EXHIBITS

EXHIBIT
NUMBER          DESCRIPTION

(a)(1)(A)       Offer to Purchase dated May 7, 2001.

(a)(1)(B)(i)    Series A Preferred Stock Letter of Transmittal.

(a)(1)(B)(ii)   Series B Preferred Stock Letter of Transmittal.

(a)(1)(B)(iii)  Series C Preferred Stock Letter of Transmittal.

(a)(1)(C)       Notice of Guaranteed Delivery.

(a)(1)(D)       Letter to Brokers, Dealers, Commercial Banks, Trust Companies
                and Other Nominees May 7, 2001.

(a)(1)(E)       Letter to Clients from  Brokers,  Dealers,  Commercial  Banks,
                Trust Companies and other Nominees dated May 7, 2001.

(a)(1)(F)       Guidelines for Certification of Taxpayer Identification Number
                on Substitute Form W-9.

(a)(1)(G)       Press Release (incorporated by reference to Dynex Capital, Inc.
                Schedule TO filed with the Securities and Exchange Commission on
                April 30, 2001).

(a)(2)-(5)      Not applicable.

(b)             Not applicable.

(d)             Not applicable.

(e)             Not applicable.

(g)             Not Applicable.