American Home Mortgage Investment Corp. Provides Update on Liquidity

  
    
  
  
    
      American Home Mortgage Investment Corp. (NYSE: AHM) today reported that 
      it is working diligently to determine how best to resolve the liquidity 
      issues that have recently developed with respect to its business. These 
      issues are primarily the result of the unprecedented disruption now 
      occurring generally in the secondary mortgage market.
    
    
      American Home Mortgage noted that this disruption has fueled concerns in 
      the market regarding credit risk, causing many market participants to 
      suspend the purchase of loans from a variety of originators including 
      American Home. Accordingly, American Home is currently experiencing a 
      hindering of access to its traditional credit facilities. Additionally, 
      American Home’s lenders have initiated margin 
      calls in response to the decline in the collateral value of certain of 
      the Company’s loans and securities held in its 
      portfolio. The Company has received and paid very significant margin 
      calls in the last three weeks and has substantial unpaid margin calls 
      pending. Further pressure on the Company’s 
      liquidity presently exists due to its warehouse lenders effectively 
      reducing, in this environment, their advance rate on new loans made by 
      the Company.
    
    
      Based on the foregoing, the Company at present is unable to borrow on 
      its credit facilities and was unable to fund its lending obligations 
      yesterday of approximately $300 million. It does not anticipate funding 
      approximately $450 to $500 million today.
    
    
      American Home Mortgage emphasized that it is seeking the course of 
      resolution, in this environment, that is least disruptive to its 
      business and to the many thousands of home buyers to whom it has 
      committed to provide mortgages. The Company has retained Milestone 
      Advisors and Lazard to assist in evaluating its strategic options and 
      advising with respect to the sourcing of additional liquidity including 
      the orderly liquidation of its assets.
    
    
      This news release contains "forward-looking statements" that are based 
      upon expectations, estimates, forecasts, projections and assumptions. 
      Any statement in this news release that is not a statement of historical 
      fact, including, but not limited to, earnings guidance and forecasts, 
      projections of financial results and loan origination volume, expected 
      future financial position, dividend plans or business strategy, and any 
      other statements of plans, expectations, objectives, estimates and 
      beliefs, is a forward-looking statement. Words such as "look forward," 
      "will," "anticipate," "may," "expect," "plan," "believe," "intend," 
      "opportunity," "potential," and similar words, or the negatives of those 
      words, are intended to identify forward-looking statements. Such 
      forward-looking statements involve known and unknown risks, 
      uncertainties and other factors that are difficult to predict, and are 
      not guarantees of future performance. As a result, actual future events 
      may differ materially from any future results, performance or 
      achievements expressed in or implied by this news release. Specific 
      factors that might cause such a difference include, but are not limited 
      to: American Home's limited operating history with respect to its 
      portfolio strategy; the potential fluctuations in American Home's 
      operating results; American Home's potential need for additional 
      capital; the direction of interest rates and their subsequent effect on 
      the business of American Home and its subsidiaries; risks associated 
      with the use of leverage; changes in federal and state tax laws 
      affecting REITs; federal and state regulation of mortgage banking; and 
      those risks and uncertainties discussed in filings made by American Home 
      with the Securities and Exchange Commission. Such forward-looking 
      statements are inherently uncertain, and stockholders must recognize 
      that actual results may differ from expectations. American Home does not 
      assume any responsibility, and expressly disclaims any responsibility, 
      to issue updates to any forward-looking statements discussed in this 
      news release, whether as a result of new information, future events or 
      otherwise.