ECC Capital Corporation (NYSE: ECR), a mortgage finance real estate investment trust that originates and invests in residential mortgage loans, today announced that it expects the closing of the sale of its mortgage banking business to Bear Stearns Residential Mortgage Corporation (Bear Res), an affiliate of Bear Stearns & Co., to occur on or about February 9, 2007. The closing is subject to completion of customary conditions to closing, including receipt of necessary state regulatory approvals.

About ECC Capital Corporation

ECC Capital Corporation, headquartered in Irvine, Calif., is a mortgage real estate investment trust (REIT) that originates and invests in residential mortgage loans. Primarily through its wholesale subsidiary, ECC Capital offers a series of mortgage products to borrowers, with a particular emphasis on "nonconforming" borrowers who generally do not satisfy the credit, collateral, documentation or other standards required by conventional mortgage lenders and loan buyers. ECC Capital is currently structured to qualify as a REIT by managing a portfolio of nonconforming loans it originates or acquires. As a REIT, ECC Capital is required to distribute dividends to its stockholders from net income generated from the spread between the interest income on its assets in its portfolio and the costs of capital to finance its acquisition of these assets.

Safe Harbor Regarding Forward-Looking Statements

Certain statements contained in this press release, including statements about the expected closing and close date of the transaction with Bear Res may be deemed forward-looking statements under federal securities laws and ECC Capital intends that those forward-looking statements be subject to the safe-harbor created thereby. This forward looking information is subject to substantial risks and uncertainties that could delay or prevent the completion of the transaction including the satisfaction of the closing conditions set forth in the purchase agreement. These forward-looking statements are based on current expectations and assumptions and are subject to risks and uncertainties, which could affect ECC Capital's future plans. ECC Capital cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected by the forward- looking statements. These factors include, but are not limited to: (i) the condition of the whole loan sale market and ECC Capital's ability to improve the value received in the whole loan market for its loan originations, (ii) the condition of the U.S. economy and financial system, (iii) interest rates and the subsequent effect on the business, (iv) ECC Capital's ability to obtain quality loan servicing and default management services, (v) the stability of residential property values, (vi) the potential effect of a failure to close the transaction with Bear Res, (vii) the potential effect of new state or federal laws or regulations, (viii) the effect of increasing competition, (ix) ECC Capital's ability to implement successfully its business plan, (x) continued availability of credit facilities and access to the securitization markets or other sources of capital, (xi) ECC Capital's ability and the ability of its subsidiaries to operate effectively within the limitations imposed on REITs by federal tax rules, (xii) ECC Capital's ability to retain qualified personnel, (xiii) the risks associated with the use of leverage and (xiv) other factors and risks discussed in ECC Capital's Annual Report on Form 10-K/A for the year ended December 31, 2005, which was filed with the Securities and Exchange Commission on October 27, 2006. You should also be aware that, except as otherwise specified, all information in this news release is as of February 5, 2007. ECC Capital undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in ECC Capital's expectations.

For Further Information:

AT THE COMPANY:

Roque A. Santi

Chief Financial Officer

(949) 856-7611

rsanti@encorecredit.com

Source: prnewswire