Newcastle to Acquire $1.7 Billion Portfolio of Residential Mortgage Loans

    NEW YORK, March 16 /PRNewswire-FirstCall/ -- Newcastle Investment Corp.
 ( NCT) today executed an agreement to purchase a $1.7 billion
 portfolio of approximately 7,300 subprime residential mortgage loans which
 is expected to close over the next 30 days. We are currently conducting due
 diligence on the portfolio. Based upon the results of our due diligence,
 the final pool may be different than that described herein.
     Kenneth M. Riis, Newcastle's Chief Executive Officer and President
 commented "We are very excited about this transaction. Constrained
 liquidity and the re-pricing of credit risk in the subprime mortgage market
 have created a unique opportunity for us to purchase a portfolio of loans
 at an attractive price with early payment default protection. We have
 underwritten this investment to generate an attractive return on capital
 using conservative default and loss assumptions."
     The loans are secured by residential homes located throughout the U.S.
 Approximately 28% of the assets are located in California, 13% in Florida,
 10% in New York and the remaining balance diversified throughout 45 states.
 Approximately 94% of the portfolio is secured by first liens and 92% of the
 assets are owner occupied. The weighted average coupon is 8.02%. 74% of the
 mortgage loans are adjustable rate and 26% are fixed rate. The majority of
 the adjustable rate mortgage loans are fixed for a period of 2 to 3 years
 and then adjust over LIBOR subject to periodic and lifetime interest rate
 caps. The current weighted average FICO score of the borrowers is 644.
     The loans will be serviced by Nationstar Mortgage LLC, an affiliate of
 our manager.
     The acquisition will initially be financed under a repurchase
 agreement. The Company expects to finance this investment on a long-term
 basis through the securitization markets in the upcoming months, following
 which we expect to have approximately $75 million of capital invested in
 this portfolio.
     About Newcastle
     Newcastle Investment Corp. invests in real estate debt securities and
 other real estate related assets. Newcastle is organized and conducts its
 operations to qualify as a real estate investment trust (REIT) for federal
 income tax purposes. Newcastle is managed by an affiliate of Fortress
 Investment Group LLC, a global alternative investment and asset management
 firm with over $30 billion in assets under management as of December 31,
 2006. For more information regarding Newcastle Investment Corp. or to be
 added to our e-mail distribution list, please visit www.newcastleinv.com.
     Certain items in this press release may constitute forward-looking
 statements within the meaning of the Private Securities Litigation Reform
 Act of 1995 including statements relating to the ultimate return
 characteristics of the loan portfolio, equity to be deployed, and ability
 to finance the portfolio on a long-term basis and the character of our
 underwriting assumptions. These statements are based on management's
 current expectations and beliefs and are subject to a number of trends and
 uncertainties that could cause actual results to differ materially from
 those described in the forward- looking statements; Newcastle can give no
 assurance that its expectations will be attained. Factors that could cause
 actual results to differ materially from Newcastle's expectations include,
 but are not limited to, changes in performance of the underlying loans and
 in values of the real property securing the loans, changes in the capital
 markets which would affect the ability to finance the portfolio or
 prepayment rates on the portfolio, and other risks detailed from time to
 time in Newcastle's SEC reports. Such forward-looking statements speak only
 as of the date of this press release. Newcastle expressly disclaims any
 obligation to release publicly any updates or revisions to any
 forward-looking statements contained herein to reflect any change in the
 Company's expectations with regard thereto or change in events, conditions
 or circumstances on which any statement is based.
 
 

SOURCE Newcastle Investment Corp.