Hanover Capital Mortgage Holdings: REIT

Hanover Capital Mortgage Holdings Affirms Dividend Policy EDISON, N.J., March 30th 2005.

Mr Mortgage

Hanover Capital Mortgage Holdings, Inc. affirmed its dividend policy with respect to its common stock for 2005. As a real estate investment trust, or REIT, Hanover is required to pay dividends equal to at least 90% of its REIT taxable income. Consistent with that requirement, Hanover's current dividend policy is to pay four quarterly dividends that represent management's estimate of Hanover's REIT income.

Hanover's per share dividend rate is determined in the first quarter of the year and, in general, would be the amount expected to be paid for each of the four quarters of the year. To the extent that our net income exceeds this rate, a special dividend would be considered after the close of the taxable year.

With the exception of the fourth quarter, dividends for the prior quarter generally will be announced following Hanover's filing of its quarterly report on Form 10-Q. The dividend for the first quarter of 2005, for instance, will be announced after the filing of the quarterly report on Form 10-Q in May 2005. Fourth quarter dividends will be announced in late December of the fiscal year.

Hanover Capital Mortgage Holdings, Inc. is a mortgage REIT with offices throughout the USA staffed by seasoned mortgage capital markets professionals. Hanover invests in mortgage-backed securities and, to a lesser extent, mortgage loans and engages in non-interest income-generating activities through its subsidiaries, Hanover Trade, Inc. and Hanover Capital Partners Ltd. Hanover Trade provides loan sale advisory and traditional loan brokerage services, technology solutions and valuation services. Hanover Trade also brokers mortgage loan pools, mortgage servicing rights and other similar assets through an Internet-based exchange. Hanover Capital Partners provides consulting and outsourcing services for third parties, including loan sale advisory services, loan file due diligence reviews, staffing solutions and mortgage assignment and collateral rectification services. For further information, visit Hanover's Web site http://www.hanovercapitalholdings.com . Certain statements in this press release may constitute "forward-looking" statements as defined in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Hanover is including this cautionary statement to make applicable and take advantage of the safe harbour provisions of the Private Securities Litigation Reform Act of 1995. Statements that are not historical fact are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements, to differ materially from future results, performance or achievements. The forward-looking statements are based on Hanover's current belief, intentions and expectations. These statements are not guarantees or indicative of future performance. Important assumptions and other important factors that could cause actual results to differ materially from those forward-looking statements include, but are not limited to, those factors, risks and uncertainties that are described in Item 1 of Hanover's Annual Report on Form 10-K for the year ended December 31, 2003 and in other securities filings by Hanover. Hanover's future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties. The forward-looking statements contained in this press release are made only as of the date hereof and Hanover undertakes no obligation to update or revise the information contained in this announcement whether as a result of new information, subsequent events or circumstances or otherwise, unless otherwise required by law.

For further information, contact: Hanover Capital Mortgage Holdings, Inc. John A. Burchett, CEO, or J. Holly Loux, CFO 732/548-0101

Hanover Capital Mortgage Holdings [REIT] affirms dividend policy.

Hanover Capital Mortgage Holdings Affirms Dividend Policy EDISON, N.J., March 30th 2005.