Susan B. Railey
                  For shareholders and securities brokers
                  (301) 468-3120 James T. Pastore For news media
                  (202) 546-6451                     FOR IMMEDIATE RELEASE

    CRIIMI MAE Completes Refinancing of 7% CMO-1 and Further Reduces Interest
                                    Expense

     Rockville,  MD, June 3, 2004 - CRIIMI MAE Inc. (NYSE:  CMM) today announced
that it had completed the refinancing of its final insured mortgage portfolio as
of June 1,  2004.  The  refinancing  of the  $45.7  million  balance  of this 7%
collateralized  mortgage obligation  ("CMO-1") will result in further annualized
cost savings.

     "As we did  previously  with our  CMO-3  and  CMO-2  transactions,  we took
advantage of the lower interest rate  environment  and exercised the call option
on this securitized mortgage obligation,  reducing the Company's annualized cash
interest expense associated with these assets by approximately $2.0 million.  In
addition, this refinancing netted approximately $3.4 million cash to the Company
because  CMO-1 was over  collateralized,"  said  President  and Chief  Operating
Officer Mark Jarrell.

     As a  result  of  exercising  the  "clean  up"  call on  CMO-1,  the  early
extinguishment   of  debt  will  result  in  a  financial   statement   loss  of
approximately  $1.1  million  related to the  unamortized  discount and deferred
financing costs  associated with the CMO. This amount,  which will be recognized
in the second  quarter of 2004,  would have been  amortized  as expense over the
remaining term of CMO-1 had the Company not exercised the  prepayment  option in
May.

     CRIIMI MAE used proceeds from the sale of $17.7 million of the FHA mortgage
loans that partially secured the debt and $31.4 million available under its $200
million  repurchase  facility  with a unit of Bear  Stearns  to redeem the debt.
Under the agreement  governing  the FHA loan sale,  CRIIMI MAE will retain a 50%
interest in the net interest paid on the FHA loans over time after  deducting an
agreed-upon  financing rate. The FHA loans have a weighted average net coupon of
8.3 % and the  financing  rate is expected to be  one-month  LIBOR plus 50 basis
points.  The $31.4 million  advanced by Bear Stearns bears interest at one-month
LIBOR plus 10 basis  points or  approximately  580 basis  points  lower than the
previous  financing costs and is  collateralized by approximately $35 million of
GNMA securities that have a weighted average net coupon of approximately 8.0 %.




     For further information, shareholders and securities brokers should contact
CRIIMI MAE Inc at (301) 816-2300, e-mail  shareholder@criimimaeinc.com  and news
media should contact James Pastore,  Pastore  Communications Group LLC, at (202)
546-6451, e-mail pastore@ix.netcom.com.


Note: Forward-looking statements or statements that contain the words "believe,"
"anticipate," "expect," "contemplate," "may," "will" and similar and projections
contained in this release involve a variety of risks and uncertainties. These
risks and uncertainties include whether the Company will be able to repay all or
any portion of the Bear Stearns debt and achieve the expected interest cost
savings; the trends in LIBOR and prices of GNMA securities; competitive
pressures; general economic conditions, restrictive covenants and other
restrictions under the operative documents evidencing the Company's outstanding
secured and other obligations (including a repurchase agreement); results of
operations, leverage, financial condition, business prospects and restrictions
on business activities under the operative documents evidencing the Company's
secured and other obligations, as well as the risks and uncertainties that are
set forth from time to time in the Company's SEC reports, including its Annual
Report on Form 10-K for the year ended December 31, 2003 and Quarterly Report on
Form 10-Q for the quarter ended March 31, 2004. Such statements are subject to
these risks and uncertainties, which could cause actual results to differ
materially from those projected. CRIIMI MAE assumes no obligation to update or
supplement forward-looking statements that become untrue because of subsequent
events

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