<PAGE>
EXHIBIT 99
NOVASTAR FINANCIAL, INC. ANNOUNCES
EXPANSION OF STOCK REPURCHASE PROGRAM AND REPURCHASE OF SHARES FROM GE EQUITY
(WESTWOOD, KANSAS - September 29, 2000) - NovaStar Financial, Inc. (NYSE:
NFI) announced today that its Board of Directors has authorized the Company to
repurchase an additional $4 million worth of its common shares, bringing the
total authorization to $9 million. As of September 28, 2000, 1,270,000 shares
costing $4,153,000 had been acquired. "Management continues to believe the
market is undervaluing the common shares of NovaStar Financial and that
investing in our shares is a wise use of liquidity resources," said Scott F.
Hartman, Chairman and Chief Executive Officer.
The Company also announced that it repurchased 666,666 common shares owned
by GE Equity, in the form of a privately negotiated bulk transaction. The shares
represent 9.7% of the Company's outstanding common stock and 100% of the shares
owned by GE Equity. The transaction was completed on September 29, 2000 at a
price of $4.50 per share. On September 28, 2000, the last reported sale price on
the New York Stock Exchange, where the stock is listed under the symbol "NFI,"
was $3.94 per share. Under the terms of the agreement, GE Equity will be made
whole if the Company in the next 3 months enters into a transaction resulting in
common shareholders receiving consideration in excess of $4.50 per share.
NovaStar Financial, Inc. is a real estate investment trust (REIT) that
invests in the single-family residential non-conforming mortgage loans
originated by its affiliates, principally NovaStar Mortgage, Inc. NovaStar
Mortgage originates mortgage loans through a nationwide network of retail
mortgage brokers.
*****
Certain matters discussed in this news release may constitute forward-looking
statements within the meaning of the federal securities laws that inherently
include certain risks and uncertainties. Actual results and the timing of
certain events could differ materially from those projected in or contemplated
by the forward-looking statements due to a number of factors, including general
economic conditions, fluctuations in interest rates, fluctuations in losses due
to default on the Company's mortgage loans, the availability of non-conforming
residential mortgage loans, the availability and access to financing and
liquidity resources, and other risk factors outlined in the Company's 1999
annual report on Form 10-K (available on the Company's website or by request to
the Investor Relations Contact). Other factors not presently identified may also
cause actual results to differ. We continuously update and revise our estimates
based on actual conditions experienced. It is not practicable to publish all
such revisions and, as a result, no one should assume that results projected in
or contemplated by the forward-looking statements included above will continue
to be accurate in the future.
*****
<PAGE>
Investor Relations Contact NovaStar website
Apryl Green www.e-novastar.com
913.514.3520 - Direct
Fax 913.514.3515
Contact for Stock transactions
Mike Bamburg
Chief Investment Officer
913.514.3526
