Bear Stearns' Subsidiary EMC Mortgage Forms "EMC Mod Squad" to Help Keep Customers in Their Homes.

New Team Will Work with Community Groups and Borrowers to Prevent Foreclosures

LEWISVILLE, Texas -- EMC Mortgage Corporation, a leading mortgage servicer that has specialized in subprime and Alt-A loans for 15 years, today announced the formation of the "EMC Mod Squad" - a loan modification team dedicated to helping delinquent borrowers avoid foreclosure on their homes. Teaming up with local community groups, the EMC Mod Squad will meet with targeted groups of EMC Mortgage customers across the country. Concentrating on cities with higher numbers of at-risk EMC Mortgage customers, the team will conduct educational workshops and explore possible financial restructuring for these homeowners.

"EMC Mortgage has a long history working with customers with financial concerns; and now, when some of our higher-risk borrowers are worried about their ability to keep their homes, we want to proactively meet with these customers face-to-face," said John Vella, President and Chief Executive Officer of EMC Mortgage. "Our goal is to help homeowners overcome the fear of talking to their servicer. What most borrowers don't know is that EMC Mortgage built its business working with distressed loan portfolios so we have a depth of expertise to alleviate many of the issues these homeowners are experiencing. So often there is a solution and by far, the best outcome for everyone involved is to keep the borrower in their home. Local community groups will be a pivotal part of this outreach effort in six major cities across the United States."

Tom Marano, global head of mortgages at Bear Stearns, EMC Mortgage's parent company and the top underwriter of U.S. residential mortgage-backed securities, said investors ultimately will benefit from assisting homeowners in financial trouble. "Proactively avoiding foreclosure can reduce the severity of losses, benefiting both homeowners and bondholders," he said. "Reducing losses and severities is a win-win proposition that EMC Mortgage is backing up with its EMC Mod Squad."

The EMC Mod Squad is comprised of 50 designated loan workout specialists and EMC Mortgage is committed to growing the team to meet borrower demand. The team will partner with local community groups such as the Consumer Credit Counseling Service to reach out to EMC Mortgage customers who are either delinquent or already in the foreclosure process to offer counseling and alternatives. In addition to one-on-one meetings with customers, the EMC Mod Squad will hold workshops across the country and its phone team will conduct outreach efforts to try to reach every delinquent EMC Mortgage customer. EMC Mortgage has set up a toll-free telephone hotline for customers to reach the EMC Mod Squad at 877-EMC-MOD1 (877-362-6631), staffed Monday-Friday 7 am to 9pm CST and Saturdays 7am-12pm CST.

"Having worked with troubled consumers for decades in finding positive resolution to default and delinquency problems, we welcome the opportunity to continue our outreach and assist with all the tools at our disposal," said Bettye Banks, Senior Vice President for Education with Consumer Credit Counseling Service of Greater Dallas. "Through this unique opportunity partnering with a servicer at this level, we can help people who might not realize what solutions they have available to them."

The EMC Mod Squad will begin their six-city national road show in Dallas tentatively scheduled for May 4th and 5th, partnering with the local Consumer Credit Counseling Service. The team will also meet consumers in Atlanta, Chicago, Detroit, Minneapolis/St. Paul and Cleveland.

About EMC Mortgage Corporation

EMC Mortgage Corporation, a wholly owned subsidiary of The Bear Stearns Companies Inc., is a mortgage banking company that specializes in the acquisition, servicing and disposition of residential mortgage loans headquartered in Lewisville, Texas, within the Dallas-Fort Worth metroplex.

Founded in 1923, The Bear Stearns Companies Inc. (NYSE: BSC) is a leading financial services firm serving governments, corporations, institutions and individuals worldwide. The Company's core business lines include institutional equities, fixed income, investment banking, global clearing services, asset management, and private client services. Headquartered in New York City, the company has approximately 14,500 employees worldwide. For additional information about Bear Stearns, please visit the firm's web site at www.bearstearns.com.