ONIT

(Dollars in millions, including for charts, except per share amounts and unless otherwise indicated. Amounts may not add in certain tables due to rounding.) OVERVIEW General We are a leading non-bank mortgage servicer and originator providing solutions through our primary brand, Onity Mortgage (formerly PHH Mortgage). On March 23, 2026, PHH Mortgage Corporation changed its name to Onity Mortgage Corporation (OMC). Onity is one of the largest non-bank servicers in the country based on UPB, focused on delivering a variety of servicing and lending programs. Onity is also one of the largest correspondent lenders in the U.S. based on origination UPB. Prior to the sale to FAR as disclosed in Note 5 - Reverse Mortgages and below under “Business Strategy”, Onity Mortgage (formerly Liberty Reverse Mortgage) has been one of the nation’s largest reverse mortgage lenders based on origination and securitization UPB. On April 30, 2026, OMC and FAR entered into an amendment of the November 2025 sale agreements whereby OMC agreed to sell a portion of its reverse MSRs comprised of approximately 20,000 Ginnie Mae HECM loans and subservice the sold portfolio and additional loans from FAR for an initial three-year term. FAR agreed to acquire OMC’s originations pipeline of reverse mortgage loans, and for a period of five years, OMC will no longer originate reverse mortgages upon closing with the exception of activities relating to the recapture of existing HECM borrowers for HECM MSRs not sold to FAR. We received Ginnie Mae’s approval of the sale on May 28, 2026 and the transaction closed on June 30, 2026. Across the forward and reverse portfolios, we serviced or subserviced 1.3 million loans with a total UPB of $341.4 billion on behalf of more than 2,600 investors and 114 subservicing clients as of June 30, 2026. We service all mortgage loan classes, including conventional, government-insured, non-Agency, small-balance commercial and multi-family loans. Our Originations business is part of our balanced business model to generate gains on loan sales and profitable returns, and to support the replenishment and the growth of our servicing portfolio. Through our retail, correspondent and wholesale channels, we originate and purchase conventional and government-insured forward and reverse mortgage loans that we sell or securitize on a servicing retained basis. In addition, we grow our mortgage servicing volume through MSR flow purchase agreements, Agency Cash Window and co-issue programs, bulk MSR purchase transactions, and subservicing agreements. 50 Volume Overview The table below summarizes the new volume of Originations by channel on a current and comparative basis. The volume of Originations is a key driver of the profitability of our Originations segment, along with margins, and also a key driver of the replenishment and growth of our Servicing segment. In the second quarter of 2026, we added $42.2 billion of new volume, with $15.5 billion of new Originations production, $23.7 billion of subservicing additions, and $3.0 billion bulk acquisitions, as further detailed in the below table. $ In billions UPB $ Change Three Months Ended Six Months Ended Q2 2026 vs. Q1 2026 YTD 2026 vs. YTD 2025 June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Mortgage servicing originations Retail - Consumer Direct MSR (1) $ 1.2 $ 1.2 $ 2.4 $ 0.7 $ — $ 1.7 Correspondent MSR (1) 6.5 5.8 12.3 9.1 0.7 3.2 Flow and Agency Cash Window MSR purchases (2) 7.8 7.2 14.9 6.3 0.6 8.6 Reverse mortgage origination (3) — 0.1 0.1 0.3 (0.1) (0.2) Total Originations production 15.5 14.3 29.7 16.4 1.2 13.3 Bulk MSR purchases (2) 3.0 5.7 8.7 5.1 (2.7) 3.6 Total servicing additions 18.5 20.0 38.4 21.6 (1.5) 16.9 Interim forward subservicing 5.7 5.2 10.8 5.0 0.5 5.8 Other new subservicing (5) 18.0 3.4 21.4 5.3 14.6 16.1 Total subservicing additions (4) 23.7 8.5 32.2 10.4 15.1 21.9 Total servicing and subservicing UPB additions $ 42.2 $ 28.5 $ 70.6 $ 32.0 $ 13.6 $ 38.8 (1)Represents the UPB of loans that have been originated or purchased (funded) during the respective periods and for which we recognize a new MSR on our consolidated balance sheets upon sale or securitization. (2)Represents the UPB of loans for which the MSR is purchased. (3)Represents the UPB of reverse mortgage loans that have been securitized on a servicing retained basis. The loans are recognized on our consolidated balance sheets under GAAP without any separate recognition of MSRs. (4)Includes interim subservicing, including the volume of UPB associated with short-term interim subservicing for certain clients as a support to their originate-to-sell business. Excludes additions related to sales of MSRs with subservicing retained. (5)Excludes $5.2 billion subservicing additions in connection with the FAR transaction. We began subservicing these loans effective with the closing of the amended sale transaction on June 30, 2026. 51 The following table summarizes the average volume of our Servicing segment, on a current and comparative basis. The average servicing volume is a key driver of the profitability of our Servicing segment. The relative weight of performing and delinquent loans or servicing and subservicing also drive the amount and timing of gross revenue and expenses. Our average total servicing and subservicing UPB increased $7.4 billion or 2.2% during the second quarter of 2026 compared to the preceding quarter (8.9% annualized), net of runoff and sales, mostly driven by an increase in owned MSRs. For the six months, our average total servicing and subservicing UPB increased $31.6 billion or 10.3% as compared to the prior year six months, primarily driven by increases in our owned MSRs and in subservicing. For comparison purposes, the total estimated industry mortgage debt outstanding increased 2.7% quarter over quarter (annualized) and 3.1% year over year (source: Mortgage Bankers Association (MBA) Mortgage Finance Forecast as of July 22, 2026). $ In billions Average UPB % Change Three Months Ended Six Months Ended Q2 2026 vs. Q1 2026 YTD 2026 vs. YTD 2025 June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Owned MSR (1) $ 169.2 $ 158.2 $ 163.8 $ 136.9 7.0% 19.6% MSR transferred to MSR capital partners (2) 35.6 38.2 36.8 40.1 (6.8)% (8.2)% Subservicing (including reverse subservicing) 123.5 125.0 124.2 116.1 (1.2)% 7.0% Reverse mortgage loans and other (3) 13.1 12.6 12.8 12.9 4.0% (0.8)% Total servicing and subservicing UPB (average) $ 341.4 $ 334.0 $ 337.6 $ 305.9 2.2% 10.4% (1)Includes MSRs related to ESS financing liabilities. (2)MSRs sold or transferred to MSR capital partners with subservicing retained and that do not qualify for derecognition / sale accounting. Reported as MSR at fair value on our consolidated balance sheet along with an associated Pledged MSR liability, economically deemed as subservicing relationship. (3)Reverse mortgage loans and other servicing (including whole loans) carried on balance sheet. As of June 30, 2026 and March 31, 2026, the total servicing and subservicing UPB amounted to $341.4 billion and $338.4 billion, respectively, a net increase of $3.0 billion or 0.9% (3.6% annualized). Market Update The following table presents key market interest rates which are important drivers of our businesses. As further discussed, the 30-year fixed rate mortgage is a key driver of Originations volume and prepayments in Servicing, the 10-year Treasury rate is a key benchmark for MSR valuation and hedging activities, and the 1-month SOFR is a key benchmark for the profitability of our Servicing segment (including float earnings and asset-backed financing cost) and our Originations segment (mortgage loan financing cost). Three Months Ended Six Months Ended June 30, March 31, June 30, June 30, 2026 2026 2026 2025 30-year fixed rate mortgage (FRM) (1) Average 6.41% 6.11% 6.26% 6.81% End of period 6.49% 6.38% 6.49% 6.77% 10-year Treasury rate (end of period) 4.44% 4.30% 4.44% 4.24% 1-month Term SOFR (average) 3.64% 3.67% 3.65% 4.32% (1)Source: Freddie Mac PMMS - Primary Mortgage Market Survey The average 30-year fixed rate mortgage rate increased 30 basis points quarter over quarter and declined 55 basis points year over year. Home refinance activity declined 23% quarter over quarter driven by the increase in the 30 year fixed rate mortgage. Home purchase activity increased 25% quarter over quarter driven by the seasonality of home buying activity. Refer to our discussion of seasonality in Key Trends and Outlook below. On a year-to-date basis (YTD), home purchase and refinance activity increased in the six months ended June 30, 2026 as compared to the same period of 2025 as homebuyers took advantage of lower rates compared to the prior year (see market interest rates graph below). 52 Our three benchmark rates above followed the decline in the federal funds rate in 2025, as displayed in the graph below. The Federal Reserve reduced its federal funds target rate a total of 50 basis points in the later part of 2025 (25 basis points in September and 25 basis points in December) resulting in increased activity in the origination market. In the second quarter of 2026, the Federal Reserve kept the federal funds rate unchanged. The 1-month SOFR largely followed the federal funds rate, as illustrated in the graph below, resulting in a 1 basis point decline (end of period) in the second quarter of 2026 as compared to a 2 basis points decline in the first quarter of 2026. The average 1-month SOFR declined 3 basis points quarter over quarter and declined 67 basis points year over year. As further illustrated in the below graph, the 10-year Treasury rate increased (14 basis points) in the second quarter of 2026 compared to an increase of 12 basis points in the first quarter of 2026, and increased 26 basis points for the six months ended June 30, 2026 compared to a decrease of 34 basis points during the same period of 2025. The 30-year fixed rate mortgage rate and the 10-year Treasury rate do not necessarily move in parallel. If the 10-year Treasury rate remains flat and the 30-year fixed mortgage rates decline this is referred to as mortgage spread tightening and may stimulate mortgage activity beyond the 10-year Treasury rate. The following graph compares market interest rates over the current and comparative periods: Another key driver of our Originations business is the overall mortgage origination market volume, that, in addition to interest rates, is sensitive to home sales and home prices and other macroeconomic conditions, such as gross domestic product and unemployment. We source a large part of our Originations volume from Correspondent lenders, and the industry volume is a relevant benchmark. The following graphs present the industry origination volumes (in $ billions, average of the MBA and Fannie Mae data) in the current and comparative periods. Source: MBA Mortgage Finance Forecast as of July 22, 2026 and Fannie Mae Housing Forecast as of July 10, 2026. In $ billions. 53 The average industry volume grew 4% quarter over quarter (Q2 2026 vs Q1 2026), led by an increase in purchase activity offset by a reduction in refinance activity, and grew 12% year over year (Q2 2026 vs Q2 2025) driven by higher refinance originations as borrowers responded to a favorable interest rate environment. On a year-to-date basis (YTD), the average industry volume grew 26% in the six months ended June 30, 2026 as compared to the same period of 2025. Comparatively, our Originations volume growth (funded volume of Correspondent and Consumer Direct) outpaced the industry for all periods presented, as summarized below: Q2 2026 vs. Q2 2026 vs. YTD 2026 vs. Q1 2026 Q2 2025 YTD 2025 Comparative Origination Volume Growth Industry (see above) 4% 12% 26% Onity 9% 50% 50% Financial Highlights Results of operations for the second quarter of 2026 •Net loss attributable to common stockholders of $13 million, or $1.53 per share basic and diluted •Servicing and subservicing fee revenue of $229 million, with $341 billion total servicing and subservicing UPB •Originations gain on sale of $33 million •$17 million MSR valuation loss attributable to input and assumption changes, net of hedging Financial condition at June 30, 2026 •Stockholders’ equity of $610 million, or $72.55 book value per common share •MSR investment of $3.2 billion •Total liquidity of $230 million, with a cash position of $197 million •Total assets of $12.4 billion Business Strategy We established the following strategy to deliver sustainable profitability and create long-term value for all stakeholders: •Balance and diversification: Maintain a scale position in origination and servicing to address market-cycle opportunities; •Prudent capital-light growth: Emphasize capital-light subservicing to drive servicing portfolio UPB growth and expand higher margin products and origination channels to drive accretive MSR investments; •Industry-leading cost structure: Achieve industry cost leadership through continuous cost and process improvement, optimizing global operations and technology, and drive innovation, including artificial intelligence-based solutions; •Top-tier operating performance and capabilities: Deliver industry top-tier servicing operational performance and increase borrower and client satisfaction; •Dynamic asset management: Optimize investment returns and liquidity through dynamic and opportunistic asset purchases and sales. Our growth and asset management strategy includes purchasing assets and/or operations of complementary businesses, by means of acquisition, merger or other transaction forms. Our strategy may also include pursuing large transactions, including bulk purchases or sales of MSRs. We have engaged in such transactions in the past, and we continue to explore opportunities that may be accretive to our business and stockholders’ value. In November 2025, OMC agreed to sell at book value its entire HECM loan portfolio and HMBS related borrowings to FAR and subservice the sold portfolio and additional loans from FAR for an initial three-year term. FAR agreed to acquire OMC’s originations pipeline of reverse mortgage loans, and for a period of five years, OMC will no longer originate reverse mortgages upon closing with the exception of activities relating to the recapture of existing HECM borrowers for HECM MSRs not sold to FAR. On April 30, 2026, OMC and FAR entered into an amendment of the November 2025 sale agreements whereby OMC agreed to sell a portion of its reverse MSRs comprised of approximately 20,000 Ginnie Mae HECM loans. The amended transaction was approved by Ginnie Mae on May 28, 2026 and closed on June 30, 2026. As of the closing date, the sold balances included $5.6 billion securitized assets ($5.2 billion UPB), the associated $5.5 billion HMBS-related borrowings (or net $70 million reverse MSR), and approximately $57 million newly originated reverse loans and tails pending 54 securitization. The final purchase price is subject to a 60-day adjustment period, following the closing date of the transaction. See Note 5 - Reverse Mortgages for additional information. Results of Operations and Financial Condition The following discussion and analysis of our results of operations and financial condition should be read in conjunction with our unaudited consolidated financial statements and the related notes appearing elsewhere in this Quarterly Report on Form 10-Q and with our audited consolidated financial statements and related notes and management’s discussion and analysis of financial condition and results of operations appearing in our Annual Report filed on Form 10-K for the fiscal year ended December 31, 2025. Condensed Statements of Operations Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Revenue $ 282.9 $ 294.3 (4)% $ 577.2 $ 496.4 16 % MSR valuation adjustments, net (70.5) (69.0) 2 (139.5) (66.2) 111 Operating expenses 139.0 132.2 5 271.2 229.4 18 Other income (expense), net (88.5) (85.2) 4 (173.6) (168.8) 3 Income (loss) before income taxes (15.1) 7.9 (291) (7.1) 32.0 (122) Income tax expense (benefit) (3.2) 0.3 n/m (2.9) (11.7) (75) Net income (loss) (1) $ (11.9) $ 7.6 (257)% $ (4.2) $ 43.6 (110) % (1)Before preferred stock dividend The following chart displays income (loss) before income taxes by segment for the periods presented (also refer to the respective segment discussions): Onity reported an $11.9 million net loss in the second quarter of 2026, compared to net income of $7.6 million in the first quarter of 2026, reflecting a $23.0 million decline in income before income taxes and a $3.5 million increase in income tax benefit quarter over quarter. The following discusses certain notable changes: •$11.4 million decrease in revenue with a $6.7 million, or 3% decrease in Servicing revenue and a $4.6 million, or 9% decrease in Originations revenue. Gain on reverse loans and HMBS-related borrowings, net decreased $14.8 million mostly in Servicing due to less favorable yield spread tightening and unfavorable assumption updates in the second quarter of 2026, including related to the FAR transaction, and in Originations to a lesser extent due to lower originations of reverse mortgages in anticipation of the closing of the amended sale agreement with FAR and lower margins driven by less favorable tightening of yield spreads. Gain on loans held for sale, net decreased $4.7 million mostly in Originations due to a lower gain in our Consumer Direct channel primarily due to volume headwinds as higher rates drove lower lock volumes and margins, offset in part by a higher gain in our Correspondent channel with higher volumes, higher margins, improved loan origination pipeline hedge effectiveness, and favorable loan sale execution. Partly offsetting these decreases, Servicing and subservicing fees increased $6.9 million mostly attributed to higher float earnings and to a lesser extent a 4% increase in average servicing UPB. •$1.5 million higher loss on MSR valuation adjustments, net with a $1.2 million unfavorable change in input and assumption updates, net of hedges, primarily driven by the unfavorable impact from interest rate changes, net of hedging, largely offset by less unfavorable valuation input and assumption updates attributed to reflect slower prepayment speeds. 55 •$6.8 million increase in operating expenses driven by a $4.6 million increase in Servicing and origination expense, primarily attributed to higher indemnification provision expense in Servicing related to the FAR transaction, and increased indemnification provision in Originations attributed to unfavorable demand and resolution activities as well as higher loan count. In addition, Professional services increased $1.9 million primarily related to certain corporate development initiatives. •$3.3 million increase in Other expense, net primarily due to an increase in net financing cost in Servicing driven by asset growth, including MSRs, partly offset by a decrease in Pledged MSR liability expense consistent with the decline in volume serviced, including Rithm. •$3.5 million increase in income tax benefit due to the loss before income taxes in the second quarter of 2026 (vs. income in the first quarter) and the discrete tax impact of certain current year MSR fair value changes and hedging gains. Total Revenue The below table presents revenue by type for the periods presented: Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Servicing and subservicing fees $ 229.3 $ 222.4 3 % $ 451.7 $ 414.6 9 % Gain on reverse loans and HMBS-related borrowings, net 3.8 18.7 (79) % 22.5 35.7 (37) % Gain on loans held for sale, net 29.4 34.1 (14) % 63.5 22.2 186 % Other revenue, net 20.4 19.1 7 % 39.5 23.9 65 % Total revenue $ 282.9 $ 294.3 (4) % $ 577.2 $ 496.4 16 % The following chart displays total revenue by segment for the periods presented (also refer to the respective segment discussions): Total revenue for the three months ended June 30, 2026 decreased $11.4 million, or 4% compared to the three months ended March 31, 2026 mostly due to the $4.6 million, or 9% decrease in Originations revenue and a $6.7 million, or 3% decrease in Servicing revenue. •The $4.6 million decrease in Originations revenue is primarily attributed to a $3.9 million reduction in Gain on loans held for sale, net with a decrease in gain in our Consumer Direct channel due to volume headwinds as higher rates drove lower lock volumes and margins, partly offset by an increase in gains in our Correspondent channel due to higher volumes, higher margins, improved MSR hedge effectiveness, and favorable execution. A decrease in Gain on reverse loans and HMBS-related borrowings, net due to lower originations of reverse mortgages in anticipation of the closing of the amended sale agreement with FAR and lower margins driven by less favorable tightening of yield spreads was largely offset by higher fees (other revenue) on higher volume. •The $6.7 million decrease in Servicing revenue is primarily due a $12.0 million decrease in Gain on reverse loans and HMBS-related borrowings, net, mostly driven by less favorable yield spread tightening and unfavorable input and assumption changes, including related to the FAR transaction. Partly offsetting this decrease, Servicing and subservicing fees increased $6.9 million driven by increased float earnings and higher servicing fees due to MSR growth (4% increase in average servicing UPB). Compared to the six months ended June 30, 2025, total revenue for the six months ended June 30, 2026 was $80.8 million, or 16% higher, due to a $45.0 million, or a 77% increase in Originations revenue, and a $35.8 million, or 8% increase in Servicing revenue. 56 •The $45.0 million increase in Originations revenue is primarily due to a $38.8 million increase in Gain on loans held for sale, net with higher gains in both our Consumer Direct and Correspondent channels. The increase is mostly driven by higher funded loan volume in both channels (50% increase in total loan production volume) and an increase in margins in our Correspondent channel primarily due to improved execution, partly offset by lower margins in our Consumer Direct channel due to the competitive pricing environment. A $13.1 million increase in fee revenue due to higher volume was partially offset by a $6.9 million decrease in Gain on reverse loans and HMBS-related borrowings, net due to lower origination volume partly offset by a higher aggregate margin driven by yield spread tightening. •The $35.8 million increase in Servicing revenue is mostly due to a $37.2 million increase in Servicing and subservicing fees driven by MSR growth (14% increase in average servicing UPB), with some offsetting factors. MSR Valuation Adjustments, Net The table below presents the key components of MSR valuation adjustments, net which include MSRs, MSR pledged liabilities and ESS financing liabilities at fair value, together with MSR hedging derivatives: Three Months Ended Six Months Ended June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Realization of cash flows (runoff) $ (53.7) $ (53.4) $ (107.1) $ (84.6) Fair value gains (losses) due to input and assumption changes 17.2 12.5 29.6 3.1 MSR hedging derivative fair value gain (loss) (34.0) (28.1) (62.0) 15.3 Sub-total fair value gains (losses) due to rates and assumptions, net of hedging (1) (16.8) (15.6) (32.4) 18.4 MSR valuation adjustments, net (1) $ (70.5) $ (69.0) $ (139.5) $ (66.2) (1)Excludes fair value changes of reverse mortgage loans and HMBS related borrowing due to rates and assumptions that are part of the MSR hedging strategy through September 2025. Refer to the MSR Hedging Strategy section of Item 3. Quantitative and Qualitative Disclosures About Market Risk for further detail and the discussion below within Servicing. The $70.5 million loss on MSR valuation adjustments, net for the three months ended June 30, 2026 is comprised of $53.7 million runoff, $17.2 million fair value gain attributable to input and assumption changes and $34.0 million loss on MSR hedging derivatives. The $1.5 million higher loss in MSR valuation adjustments, net as compared to the three months ended March 31, 2026 is primarily due to $10.1 million from the unfavorable impact of interest rate changes, net of hedge activity, compared to a favorable impact in the first quarter of 2026, largely offset by less unfavorable valuation input and assumption updates to reflect slower prepayment speeds in the current quarter. •MSRs are subject to runoff, a fair value decline due to the realization of expected cash flows and yield based on projected borrower behavior, including scheduled amortization of the loan UPB together with projected voluntary and involuntary prepayments. Runoff was mostly flat as compared to the preceding quarter ($0.2 million higher) as the impact of owned MSR portfolio growth was offset by the favorable impact of market rates. •The $17.2 million fair value gain due to input and assumption changes is mostly attributed to a favorable change in market rates as the 10-year Treasury rate increased 14 basis points in the second quarter of 2026 and revaluation gains in our Originations segment, partially offset by certain unfavorable assumption updates to reflect continued increased prepayment speeds in the current quarter caused by significant intra-quarter market rate decline in the first and second quarters of the current year. The $4.7 million increase in the gain as compared to the first quarter of 2026 is mainly driven by less unfavorable input and assumption updates attributed to reflect market trade pricing levels. •MSR hedging derivative fair value gains or losses are designed to partially offset the expected fair value changes of the net MSR, MSR pledged liabilities and ESS exposure, commensurate with our target hedge coverage ratio. The $34.0 million derivative loss recognized in the three months ended June 30, 2026 and the variance from the prior quarter are driven by interest rate changes as we maintained a high hedge coverage ratio in both quarters. Also refer to Item 3. Quantitative and Qualitative Disclosures About Market Risk for further detail on our hedging strategy and its effectiveness. The $139.5 million loss on MSR valuation adjustments, net for the six months ended June 30, 2026 is comprised of $107.1 million runoff, $29.6 million fair value gain attributable to input and assumption changes and $62.0 million loss on MSR hedging derivatives. The $73.3 million higher loss in MSR valuation adjustments, net as compared to the six months ended June 30, 2025 is primarily driven by unfavorable assumption updates recognized in the first half of 2026 (vs. favorable updates 57 in the same period of 2025) and higher realization of cash flows, partly offset by $28.2 million in favorable impact of interest rate changes, net of hedge activity in the first half of 2026 as compared to the same period for the prior year. •The unfavorable $22.5 million increase in runoff expense is mostly due to owned MSR portfolio growth. •The $29.6 million fair value gain due to input and assumption changes is mostly attributed to a favorable change in market rates and revaluation gains in our Originations segment, significantly offset by unfavorable assumption updates to reflect increased prepayment speeds, higher realization of cash flows, and change in delinquency in the first half of 2026. The $26.5 million increase in the gain as compared to the six months ended June 30, 2025 is primarily driven by changes in market interest rates, as the 10-year Treasury rate increased 26 basis points during the six months ended June 30, 2026 compared to a decrease of 34 basis points during the same period of 2025, and higher valuation gains in our Originations segment, partially offset by unfavorable assumption updates described above (vs. favorable assumption updates in the first half of 2025). •The change from a $15.3 million gain from derivatives in the six months ended June 30, 2025 to a $62.0 million loss in the six months ended June 30, 2026 is mainly due to the market interest rate changes noted above. During the six months ended June 30, 2025, our HECM MSR was part of the overall interest-rate sensitive MSR portfolio. Effective in the fourth quarter of 2025, our HECM MSR is hedged with dedicated third-party derivative instruments, and the related gain/loss is reported in Gain on reverse loans and HMBS-related borrowings, net. Operating Expenses The table below presents the key components of operating expenses: Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Compensation and benefits $ 69.8 $ 69.7 — % $ 139.5 $ 118.4 18 % Servicing and origination 23.1 18.5 25 41.6 26.0 60 Technology and communications 17.9 17.5 2 35.4 30.5 16 Professional services 16.7 14.8 13 31.4 31.0 1 Occupancy, equipment and mailing 8.2 8.5 (4) 16.7 16.3 2 Other expenses 3.3 3.1 6 6.6 7.2 (10) Total operating expenses $ 139.0 $ 132.2 5 % $ 271.2 $ 229.4 18 % Average headcount 4,067 4,206 (3) % 4,133 4,267 (3) % The following chart displays operating expenses by segment for the periods presented (also refer to the respective segment discussions): Compensation and benefits expense for the three months ended June 30, 2026 was flat as compared to the three months ended March 31, 2026, due to a $2.5 million increase in incentive compensation expense, mostly driven by an increase in the fair value of cash-settled share-based awards driven by our stock price (1% increase in our stock price during the three months ended June 30, 2026 vs. a 14% decrease in the comparative period), as well as an increase in equity-settled awards expense. The increase in incentive compensation was largely offset by a $1.9 million decrease in severance and $1.0 million decrease in salaries and benefits, mostly in our Servicing segment in connection with Rithm’s decision to not renew its subservicing agreements effective January 31, 2026. 58 Compared to the six months ended June 30, 2025, Compensation and benefits expense for the six months ended June 30, 2026 increased $21.1 million, or 18%, largely due to an $8.6 million increase in commissions due to higher Originations production volume in both channels, and an $8.2 million increase in salaries and benefits with an increase in headcount in the Originations and Corporate segments to support and accelerate business growth, partly offset by a decrease in the Servicing segment attributable to the Rithm subservicing agreements termination, runoff of our reverse subservicing portfolio, lower delinquencies, and further efficiency gains within forward servicing. In addition, severance expense increased $3.7 million, including related to the termination of our subservicing agreements with Rithm as discussed above and the FAR transaction. While our total average headcount declined 3%, driven by a 5% decrease in offshore average headcount, our U.S. average headcount increased 4%. Servicing and origination expense for the three months ended June 30, 2026 increased $4.6 million compared to the three months ended March 31, 2026, primarily due to higher indemnification provision expense for loan put-back and related contingencies in Servicing related to the FAR transaction, and increased indemnification provision attributed to unfavorable demand and resolution activities as well as higher loan count in Originations compared to the three months ended March 31, 2026, offset in part by higher provision expense on servicing receivables in the first quarter of 2026 related to MSR sales. Compared to the six months ended June 30, 2025, Servicing and origination expense for the six months ended June 30, 2026 increased $15.6 million or 60% due to a $10.8 million increase in Servicing expense and $4.9 million higher Originations expense. The increase in Servicing expense is primarily driven by a $6.8 million increase in satisfaction and interest on payoff expense due to higher payoff volume, and increased indemnification provision expense as discussed above. The increase in Originations expense is primarily due to higher production volume and unfavorable demand and resolution activities compared to six months ended June 30, 2025. Technology and communication expense for the three months ended June 30, 2026 was flat as compared to the three months ended March 31, 2026. Compared to the six months ended June 30, 2025, Technology and communication expenses for the six months ended June 30, 2026 increased $4.9 million or 16% primarily driven by higher Servicing and Originations volume and our technology initiatives (including robotic process automation, digitization and machine learning / artificial intelligence). Professional services expense for the three months ended June 30, 2026 increased $1.9 million compared to the three months ended March 31, 2026 primarily attributed to certain corporate development initiatives. Compared to the six months ended June 30, 2025, Professional services expense for the six months ended June 30, 2026 was flat driven by a $4.3 million increase in other professional services primarily driven by an increase in call center volume in connection with the Rithm servicing transfer largely offset by a $3.9 million decline in legal expenses. The decline in legal expenses is primarily attributed to our accrual for probable losses in connection with the settlement of a legacy litigation matter in the first quarter of 2025, offset in part by lower recoveries of prior years’ legal expenses in the first half of 2026. Other Income (Expense) Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Interest income $ 55.5 $ 41.0 35 % $ 96.5 $ 58.3 66 % Interest expense (103.1) (82.7) 25 (185.7) (142.7) 30 Net interest expense $ (47.6) $ (41.7) 14 % $ (89.2) $ (84.4) 6 % Pledged MSR liability expense (38.2) (42.6) (10) (80.8) (84.9) (5) Other, net (2.7) (0.9) 189 (3.6) 0.4 (1,000) Other income (expense), net $ (88.5) $ (85.2) 4 % $ (173.6) $ (168.8) 3 % Refer to the segments for discussion and analysis of Interest income and Interest expense. Refer to the Servicing segment for discussion and analysis of Pledged MSR liability expense. 59 Income Tax Expense (Benefit) Three Months Ended Six Months Ended June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Income tax expense (benefit) $ (3.2) $ 0.3 $ (2.9) $ (11.7) Income (loss) before income taxes $ (15.1) $ 7.9 (7.1) $ 32.0 Effective tax rate 20.9 % 3.7 % 40.3 % (36.6) % We conduct periodic evaluations of positive and negative evidence to determine whether it is more likely than not that the deferred tax asset can be realized in future periods. In these evaluations, we give more significant weight to objective evidence, such as our actual financial condition and historical results of operations, as compared to subjective evidence, such as projections of future taxable income or losses. As of June 30, 2026, we believe that the weight of the positive evidence outweighs the negative evidence regarding the realization of our U.S. federal and certain state deferred tax assets. The release of a significant portion of the valuation allowance against our U.S jurisdiction deferred tax assets at December 31, 2025 resulted in a $120.1 million income tax benefit in the fourth quarter of 2025. As of June 30, 2026, for certain U.S. state net operating losses and interest expense disallowance carryforwards, we believe the weight of the negative evidence continues to outweigh the positive evidence regarding the realization of these state deferred tax assets and as a result are not considered to be more likely than not realizable; therefore, we have maintained a valuation allowance against these assets. Our income tax provision or benefit for the interim period is determined based on an estimated annual effective tax rate, adjusted for discrete items. Our income tax benefit for the six months ended June 30, 2026 is primarily driven by the jurisdictional mix of our earnings and includes income tax expense attributed to the U.S. jurisdiction whereas in the six months ended June 30, 2025 no such U.S. jurisdiction income tax expense was recognized due to a full valuation allowance against U.S. federal deferred tax assets. The increase in the effective tax rate for the six months ended June 30, 2026 compared to the same period of 2025 is primarily due to the accrual of taxes in 2026 in the U.S. jurisdiction due to the removal of a significant portion of our U.S. valuation allowance at December 31, 2025 as well as the $13.3 million of income tax benefit recognized during the six months ended June 30, 2025 from the favorable resolution of an uncertain tax position. 60 Balance Sheet and Cash Flow Overview Financial Condition Summary June 30, 2026 December 31, 2025 $ Change % Change Cash and cash equivalents $ 196.6 $ 180.5 $ 16.1 9 % Restricted cash 196.3 84.1 112.2 133 MSRs, at fair value 3,208.8 2,825.3 383.5 14 Advances, net 369.5 483.4 (113.9) (24) Loans held for sale, at fair value 3,601.9 1,891.7 1,710.2 90 Reverse loans held for sale pooled into HMBS, at fair value — 9,807.5 (9,807.5) (100) Reverse loans held for investment pooled into HMBS, at fair value 3,640.6 — 3,640.6 n/m Receivables, net 233.9 189.8 44.1 23 Premises and equipment, net 11.0 10.8 0.2 2 Other assets 365.3 273.9 91.4 33 Contingent loan repurchase asset 526.4 423.6 102.8 24 Total assets $ 12,350.3 $ 16,170.6 $ (3,820.3) (24) % Total Assets by Segment Servicing $ 9,880.3 $ 14,683.5 $ (4,803.2) (33) % Originations 2,116.0 1,252.3 863.7 69 Corporate 354.0 234.8 119.2 51 $ 12,350.3 $ 16,170.6 $ (3,820.3) (24) % HMBS-related borrowings, at fair value $ 3,610.9 $ 9,611.7 $ (6,000.8) (62) % MSR related financing liabilities, at fair value 729.0 842.0 (113.0) (13) MSR financing facilities, net 1,566.1 1,285.2 280.9 22 Advance match funded liabilities 254.7 341.9 (87.2) (26) Mortgage warehouse facilities 2,061.7 1,224.6 837.1 68 Reverse mortgage securitization notes, net 1,925.0 899.3 1,025.7 114 Senior notes, net 693.2 489.6 203.6 42 Other liabilities 323.5 374.9 (51.4) (14) Contingent loan repurchase liability 526.4 423.6 102.8 24 Total liabilities 11,690.5 15,492.8 (3,802.3) (25) % Mezzanine equity 49.9 49.9 — — Total stockholders’ equity 609.9 627.9 (18.0) (3) Total liabilities and equity $ 12,350.3 $ 16,170.6 $ (3,820.3) (24) % Total Liabilities by Segment Servicing $ 9,371.6 $ 14,041.3 $ (4,669.7) (33) % Originations 2,041.6 1,172.6 869.0 74 Corporate 277.2 278.8 (1.6) (1) $ 11,690.4 $ 15,492.8 $ (3,802.4) (25) % Book value per share $ 72.55 $ 73.69 $ (1.14) (2) % Total assets decreased $3,820 million, or 24%, between December 31, 2025 and June 30, 2026 primarily due to the decline in Reverse loans, pooled into HMBS, partly offset by the growth in Loans held for sale and MSRs. Total Reverse loans, pooled into HMBS declined $6,167 million mostly in connection with the sale of reverse MSRs comprised of approximately 20,000 Ginnie Mae HECM loans and the HMBS related borrowings to FAR in a transaction which closed on June 30, 2026. The sold 61 loans, which had a carrying value of $5,630 million were classified as Reverse loans held for sale, pooled into HMBS. The reverse loans not sold in the amended FAR transaction were reclassified as Reverse loans held for investment, pooled into HMBS. In addition to the sale, reverse loans declined due to the runoff of the portfolio exceeding fair value gains and originations since the acquisition of the $2.9 billion portfolio of reverse mortgage loans from Waterfall in November 2024 that is relatively more aged (faster runoff). See Note 5 - Reverse Mortgages for additional information. In addition, servicing advances declined $114 million largely driven by seasonal reduction of taxes and insurance (T&I) balances and lower delinquencies. Our portfolio of Loans held for sale increased $1,710 million mostly driven by the growth of our Originations pipeline and the acquisition of reverse mortgage buyouts. Our MSR portfolio increased $383 million mostly due to $598 million MSR additions, partly offset by $144 million runoff and the derecognition of $106 million of MSRs and the related Pledged MSR liability associated with other MSR capital partners with a UPB of $5.9 billion as MSR sale accounting criteria were met on June 30, 2026. Restricted cash increased $112 million primarily attributed to debt service accounts related to OLIT Notes. Contingent loan repurchase asset increased $103 million due to higher Ginnie Mae delinquencies driven by changes to the FHA modifications program and by the government shutdown in 2025, and Other assets increased $91 million mostly due to an increase in REO in connection with reverse mortgage buyouts. Total liabilities decreased by $3,802 million compared to December 31, 2025, largely due to the factors described above. HMBS-related borrowings decreased by $6,001 million primarily due to the sale of reverse MSRs described above, as well as repayments exceeding fair value losses and new securitizations after the $2.9 billion acquisition of reverse mortgage assets and assumption of HMBS-related borrowings in November 2024. Advance match funded liabilities decreased $87 million consistent with the decline in servicing advances, as discussed above, and MSR related financing liabilities, at fair value declined $113 million mostly due to the derecognition transaction described above. Reverse mortgage securitization notes, net increased $1,026 million due to the issuance of additional OLIT Notes in 2026 to finance the acquisition of reverse mortgage loan buyouts. Mortgage warehouse facilities increased $837 million due to the higher Originations pipeline loans held for sale balance at June 30, 2026, and MSR financing facilities increased $281 million with the increase in our MSR portfolio. Senior notes, net increased $204 million due to our issuance of an additional $200 million aggregate principal amount of 9.875% Senior Notes due 2029 at 103.25% on January 30, 2026. Contingent loan repurchase liability increased $103 million as discussed above. Total stockholders’ equity decreased $18.1 million during the six months ended June 30, 2026 mostly due to $12.0 million repurchases of our common stock, $4.2 million net loss, and $2.1 million dividends on preferred stock. Cash Flows Our cash flows are summarized as follows: $ in millions Six Months Ended June 30, 2026 2025 Net cash used in operating activities $ (2,106) $ (747) Net cash provided by investing activities 814 887 Net cash provided by (used in) financing activities 1,420 (149) Net increase (decrease) in cash, cash equivalents and restricted cash $ 128 $ (9) Cash, cash equivalents and restricted cash at end of period $ 393 $ 257 Our operating cash flows may be summarized as follows: Six Months Ended June 30, 2026 2025 Origination/acquisition and sale of loans held for sale, net (1) $ (2,265) $ (875) Decrease in advances, net 133 101 Interest paid (157) (126) Income tax paid (2) (2) Other net operating cash inflows 184 156 Net cash used in operating activities $ (2,106) $ (747) (1) Loan acquisitions are generally servicing released, meaning cash outflows include the servicing rights component of the acquired loans. Most of our loan sales, however, are servicing retained, meaning the cash proceeds we receive exclude the value of the servicing rights we retain. As a result, originated MSRs (OMSRs) generated operating cash outflows of $261 million and $143 million in the six months 62 ended June 30, 2026 and 2025, respectively. We generally finance these new OMSRs along with purchased MSRs (those reflected as investing cashflows) with MSR financing facilities at advance rates up to 70%. Cash flows for the six months ended June 30, 2026 Our operating activities used $2,106 million of cash during the period, with $2,265 million net cash paid on loans held for sale and $157 million interest paid, partly offset by $133 million net collections of servicing advances and $184 million other net operating cash inflows. The $2,265 million net cash paid on loans held for sale is attributed to the growth of the pipeline with loan production volume exceeding sales, $277 million net HECM reverse mortgages originations during the six months ended June 30, 2026 (previously reported within investing activities), $261 million originated MSRs, and the acquisition of $839 million reverse buyouts (securitized with our OLIT program). The period over period increase is mostly driven by higher originated MSRs and loan production volume, net HECM reverse mortgages originations (previously reported within investing activities), as well as the acquisition of reverse buyouts during the six months ended June 30, 2026. The $133 million net collections of servicing advances were mostly driven by seasonality and lower delinquencies. Interest paid ($157 million, excluding interest collections) increased $31 million period over period, primarily due to higher interest on our reverse mortgage securitization notes, mortgage warehouse facilities, and MSR financing facilities in 2026 due to volume growth, and interest on additional senior notes issued in January 2026, offset in part by lower average short-term market interest rates. Our other net operating activities provided $184 million of cash flows, that included collections of servicing fees, ancillary income and other revenue, payment of employees and vendors, and other cash receipts and disbursements. The $184 million of positive other net operating cash flows, compared to $156 million during the six months ended June 30, 2025 is primarily driven by higher net collection on government-insured loan claims due to higher volume, partially offset by higher payment on servicing related obligations (including Rithm, upon deboarding of the servicing portfolio), and other cash receipts and disbursements. Our investing activities provided $814 million of cash during the period. Net cash inflows primarily include $1,095 million net cash received in connection with our HECM reverse mortgages, $75 million proceeds from the sale of reverse MSRs to FAR ($94 million total proceeds, $19 million reported within operating activities), and $54 million proceed from sales of real estate. The HECM reverse mortgage collections are mostly attributed to the runoff of the reverse portfolio. $277 million of net HECM reverse mortgage originations are reported within operating activities (see discussion above). Loans are repurchased from HMBS pools once they reach 98% of maximum claim amount and collections are generally received from assignment to HUD or liquidation. Our investing activities also reflect a $312 million net cash outflow related to MSR investments, through bulk acquisitions or purchases in Co-issue and Agency programs. Our net MSR investments during the six months ended June 30, 2026 increased $166 million when compared with the six months ended June 30, 2025 due to our growth strategy. As discussed above, these MSR investments should be combined with the $261 million MSR originations presented within operating cash flows (vs. $143 million during six months ended June 30, 2025) when assessing financing needs discussed below. Investing cash outflows also included $91 million for the purchase of real estate. Our financing activities provided $1,420 million of cash during the period. Net cash inflows primarily include $837 million net from borrowings under our mortgage warehouse facilities to finance our Originations pipeline (net of $31 million repayments of borrowings as a result of the sale of newly originated reverse loans and tails pending securitization in the FAR transaction), $1,020 million net from the issuance of OLIT securitization for reverse mortgage buyouts, $207 million from issuance of 9.875% Senior Notes due 2029 in January 2026, and $282 million net proceeds from our MSR financing facilities, reflecting the growth of our different portfolios. Offsetting cash outflows primarily included $774 million net cash repaid in connection with our reverse HMBS related borrowings, with $1,106 million of repayments of HMBS-related borrowings partly offset by $332 million securitization of new reverse loan originations and tail advancing. The net financing cash outflows indicates a runoff of the HECM reverse mortgages portfolio that largely exceeded originations in the six months ended June 30, 2026, attributed to a reduction in originations activity in anticipation of the closing of the amended sale agreement with FAR and the runoff of the relatively aged portfolio acquired from Waterfall in November 2024. Other cash outflows include $87 million of net repayments on advance match funded liabilities due to the decline in servicing advances and $12.0 million repurchases of our common stock. Cash flows for the six months ended June 30, 2025 Our operating activities used $747 million of cash during the period with $875 million net cash paid on loans held for sale, $101 million net collections of servicing advances and $153 million other operating cash inflows, net. The $875 million net cash paid on loans held for sale is attributed to the growth of the pipeline with loan production volume exceeding sales and $143 million originated MSRs. The $101 million net collections of servicing advances was mostly driven by seasonality, as well as lower delinquencies and loan resolutions in our non-Agency MSR portfolio. Operating cash flows included $126 million interest paid on our financing liabilities with relatively higher interest paid on our warehouse financing due to volume 63 growth and lower corporate debt interest payment after our successful refinancing in the fourth quarter of 2024. Other operating cash inflows, net of $153 million, primarily includes collections of servicing fees and ancillary income, payment of operating expenses, and net cash outflow for our hedging derivative activities during the period. Our investing activities provided $887 million of cash. Cash inflows primarily include $1,018 million net cash received in connection with our HECM reverse mortgages, with increased collections driven by the portfolio acquired from Waterfall, and $23 million proceeds from sales of real estate. The increase in our reverse mortgage collections in the six months ended June 30, 2025 was largely offset by the increase in our HMBS borrowings repayment under the terms of the Ginnie Mae securitization - see below paragraph. Offsetting cash outflows include $151 million to invest in MSRs as part of our growth strategy. Our financing activities used $149 million of cash. Cash outflows primarily include $967 million net cash repaid in connection with our reverse HMBS related borrowings, with $1,545 million of repayments of borrowings (see above discussion of collection drivers), partly offset by $578 million received in connection with our reverse mortgage securitizations of our new production, and which are accounted for as secured financings. Other cash outflows include $75 million of net repayments on advance match funded liabilities due to the decline in servicing advances, $63 million of repayment on reverse mortgage securitization notes due to runoff of reverse buyouts, and $35 million of net payments on the financing liabilities related to MSRs transferred and ESS financings due to runoff. Offsetting financing cash inflows are primarily comprised of $262 million net drawdown on MSR financing facilities due to the increase in the MSR portfolio and $719 million net from borrowings under our mortgage warehouse facilities due to the increase in loans held for sale. Key Trends and Outlook Historical trends The following table displays historical trends of our financial performance by quarter. Past performance is not necessarily indicative of future results. Q1’25 Q2’25 Q3’25 Q4’25 Q1’26 Q2’26 Servicing and subservicing fees $ 203.3 $ 211.3 $ 217.5 $ 225.1 $ 222.4 $ 229.3 Gain on reverse loans and HMBS-related borrowings, net (1) 23.8 11.9 13.0 10.0 18.7 3.8 Gain on loans HFS, net - Originations 15.6 15.4 30.7 35.5 36.9 33.0 Gain on loans HFS, net - Servicing (3.8) (5.0) 3.4 1.2 (2.7) (3.6) Gain on loans held for sale (HFS), net 11.8 10.4 34.1 36.7 34.1 29.4 Other revenue, net 10.9 13.0 15.7 18.2 19.1 20.4 Total revenue - Originations 28.6 29.5 47.1 51.9 53.9 49.3 Total revenue - Servicing 221.2 217.1 233.2 238.2 240.3 233.6 Total revenue 249.8 246.6 280.3 290.0 294.3 282.9 MSR realization of cash flows (41.1) (43.4) (48.8) (49.9) (53.4) (53.7) MSR other fair value changes net of hedging (1) 2.2 16.2 3.8 (8.8) (15.6) (16.8) MSR valuation adjustments, net (38.9) (27.3) (45.0) (58.7) (69.0) (70.5) Operating expenses 119.9 109.5 125.8 136.5 132.2 139.0 Net interest expense (40.8) (43.5) (45.3) (43.5) (41.7) (47.6) Pledged MSR liability expense (2) (41.9) (43.0) (41.7) (42.9) (42.6) (38.2) Other 0.9 (0.4) 0.5 (0.7) (0.9) (2.7) Other income (expense) (81.9) (87.0) (86.5) (87.1) (85.2) (88.5) Income (loss) before income taxes $ 9.1 $ 22.8 $ 23.1 $ 7.7 $ 7.9 $ (15.1) (1)Fair value changes of the reverse mortgage exposure (securitized reverse loans and HMBS-related borrowings, net) due to interest rates were economically hedged along with the MSR fair value changes due to interest rates per our Risk Management policy, while reported in two separate line 64 items above for GAAP presentation purposes. Effective October 2025, reverse mortgage exposure is now hedged with dedicated third-party derivatives, whose fair value changes are presented within Gain on reverse loans and HMBS-related borrowings, net in our consolidated statements of operations. (2)Servicing fee collection associated with MSR failed sales (transactions that do not meet sale accounting criteria) is presented gross, within Servicing fees and the associated remittance is presented within Pledged MSR liability expense (net of contractual subservicing fee retained). Total revenue shows a generally upward trend, with a notable increase in 2025 driven by the growth of servicing fees on our owned MSR portfolio and Originations Gain on loans held for sale. The volatility in Gain on reverse loans is primarily due to fluctuations in interest rates and is partially offset by our MSR hedging program and additionally, in the second quarter of 2026, the effects of the FAR transaction. The volatility in Servicing Gain on loans held for sale is mainly due to reverse mortgage buyouts. MSR valuation adjustments, net, reflect the increasing MSR portfolio runoff expense, consistent with the portfolio growth, with fair value volatility due to interest rate, input and assumption changes, largely mitigated by an effective interest rate hedging program. Operating expenses are generally trending upward, following the growth of our operations. Quarterly fluctuations of operating expenses are largely driven by legal expenses and recoveries. Net interest expense fluctuates as we utilize larger debt balances to finance the growth of our businesses, through acquisition of servicing assets or by funding newly originated loan pipeline. Pledged MSR liability expense (effectively the servicing fee remittances of MSRs) has been relatively stable, with a decline in the second quarter of 2026 consistent with lower volume serviced, including Rithm. Income before income taxes shows Onity’s net profitability in all quarters except in the second quarter of 2026. See Results of Operations and Financial Condition above for additional information on the net loss in the second quarter of 2026. Net profitability overall was driven by revenue growth, cost management and effective MSR hedging. Seasonality Mortgage origination and servicing can be seasonal with typically higher home purchase activity in the spring and summer driving higher Originations volumes and Gain on loans held for sale and higher MSR runoff expense in the second and third quarters. Servicing revenue, specifically float income, is also impacted by the seasonality of escrow balances typically lower in the first quarter and increasing throughout the year. Similarly, interest expense on advance match-funded liabilities is impacted by the seasonality of tax and insurance advances. Advances increase around major tax payment cycles and at the time of insurance payments when disbursements exceed borrower escrow collections and subsequently decline as collections replenish escrow accounts. The seasonal trends may be offset or impacted by changes in our volumes and changes in interest rates, as reflected in the above table. Financial performance drivers The following table summarizes certain key drivers of our revenue in the quarter compared with the prior quarter, as disclosed in the segment discussions of this Management Discussion and Analysis. The table also provides certain considerations for, and may be read in conjunction with, the outlook discussed below. 65 Revenue Statement of Operations Average fee/margin/rate (7) Volume Drivers Q2’26 Q1’26 Q2’26 Q1’26 Q2’26 Q1’26 Ref. Servicing fee on Owned MSR (incl. ESS) $ 123.4 $ 117.1 0.29 % 0.29 % 171.0 159.6 (1) Servicing fee on transferred MSR 26.6 31.9 0.30 % 0.33 % 35.6 38.2 (1) Servicing fee 150.0 148.9 0.29 % 0.30 % 206.6 197.8 (1) Subservicing fee 25.7 26.0 $ 189 $ 178 542.9 583.7 (2) Float earnings 36.6 30.1 3.49 % 3.47 % 4.2 3.5 (3) Other ancillary income 17.0 17.4 0.02 % 0.02 % 330.0 322.8 (4) Servicing and subservicing fees 229.3 222.4 0.28 % 0.28 % 330.0 322.8 (4) Gain on reverse loans and HMBS-related borrowings, net - Originations 1.6 4.5 5.33 % 5.44 % 0.03 0.08 (5) Net interest income (servicing fee) 7.0 7.2 0.25 % 0.26 % 11.4 11.2 (1) Sub-total 8.6 11.7 Other change in fair value of securitized loans and HMBS-related borrowings, net (4.8) 7.0 (8) Gain on reverse loans and HMBS-related borrowings, net 3.8 18.7 0.13 % 0.67 % 11.4 11.2 (1) Gain on loans HFS, net - Orig., Consumer Direct 18.3 27.7 1.53 % 2.33 % 1.20 1.19 (5) Gain on loans HFS, net - Orig., Correspondent 14.7 9.1 0.23 % 0.16 % 6.46 5.82 (5) Gain on loans HFS, net - Originations 33.0 36.9 0.43 % 0.53 % 7.66 7.01 (5) Loss on loans HFS, net - Servicing (3.6) (2.7) (0.94) % (1.06) % 1,536.3 1,033.6 (6) Gain on loans held for sale (HFS), net 29.4 34.1 Other revenue, net - Originations 14.7 12.6 0.19 % 0.18 % 7.66 7.01 (5) Other revenue, net - Servicing 5.7 6.5 0.01 % 0.01 % 341.4 334.0 (1) Other revenue, net 20.4 19.1 Total revenue - Originations 49.3 53.9 0.64 % 0.77 % 7.66 7.01 (5) Total revenue - Servicing 233.6 240.3 0.27 % 0.29 % 341.4 334.0 (1) Total revenue $ 282.9 $ 294.3 0.33 % 0.35 % 341.4 334.0 (1) (1)Average UPB (in billions) (2)Average loan count (in 000’s) (3)Average float balance (in billions) (information not disclosed in Servicing segment) (4)Average forward servicing plus total forward and reverse subservicing UPB (in billions) (5)Newly funded Originations UPB (in billions) (6)Fair value loans held for sale (in millions) (7)Implied/calculated as percentage of revenue to volume driver, annualized (8)Includes HECM hedging derivative gains of $2.4 million and $2.4 million, respectively. Outlook The following discussion provides additional information regarding certain key drivers of our financial performance and includes certain forward-looking statements that are based on the current beliefs and expectations of Onity’s management and are subject to significant risks and uncertainties. Refer to Forward-Looking Statements beginning on page 2 of this Form 10-Q and Part I, Item 1.A. of our Annual Report on Form 10-K for the year ended December 31, 2025, for discussion of certain of those risks and uncertainties and other factors that could cause Onity’s actual results to differ materially because of those risks and uncertainties. There is no assurance that actual results will be in line with the outlook information set forth below, and Onity does not undertake to update any forward-looking statements. Refer to the Segment results of operations section for further detail, the description of our business environment, initiatives and risks. Servicing and subservicing fee revenue - Our servicing fee revenue is a function of the volume being serviced - UPB for servicing fees and loan count for subservicing fees. We expect we will continue to grow our servicing and subservicing portfolio through our multi-channel Originations platform, MSR bulk acquisitions, and subservicing additions. We expect ancillary float income to trend with short-term interest rates also considering changes in average float balances due to seasonality and portfolio growth. We expect a reduction of our fee revenue in 2026 as compared to 2025 because of the termination of our subservicing agreements with Rithm that accounted for approximately 2% of the UPB and 5% of the loan count of our total servicing and subservicing portfolio, and approximately 17% of all delinquent loans that Onity services as of June 30, 2026 (10%, 19% and approximately 50% at December 31, 2025). Gain on sale of loans held for sale - Our gain on sale is driven by both Originations volume and margin and is channel-sensitive. The updated industry forecasts (average of MBA, July 2026 and Fannie Mae, July 2026) suggest an estimated 11% 66 increase in loan origination in 2026 as compared to 2025 (including a 4% growth of purchase volume and 26% growth of refinance volume), with the 30-year fixed rate mortgage expected to end 2026 mostly flat at 6.4%. However, macroeconomic conditions and their impact on the housing and capital markets remain highly uncertain. We anticipate growth in our Consumer Direct channel driven by our increased recapture capabilities that may be curtailed if interest rates remain at the current levels or increase. We expect to modestly and selectively grow our Correspondent volume as part of our MSR replenishment and growth strategy considering available liquidity. We also expect continued competitive pressure on margins across all channels and volatility of gain on sale associated with GSE pricing dependency and volatile interest rates. We expect some further volatility of gain (loss) on sale on loans held for sale related to reverse mortgage buyouts (mostly inactive loans) due to the increased size of the portfolio. Gain on reverse loans and HMBS-related borrowings, net - In November 2025, we entered into a series of agreements with FAR, including the sale of our entire reverse mortgage servicing portfolio, at book value, with subservicing retained for an initial three-year term. On April 30, 2026, OMC and FAR entered into an amendment of the November 2025 sale agreements whereby OMC agreed to sell a portion of its reverse MSRs comprised of approximately 20,000 Ginnie Mae HECM loans. FAR agreed to acquire OMC’s originations pipeline of reverse mortgage loans, and for a period of five years, OMC will no longer originate reverse mortgages upon closing with the exception of activities relating to the recapture of existing HECM borrowers for HECM MSRs not sold to FAR. We received Ginnie Mae’s approval of the sale on May 28, 2026 and the transaction closed on June 30, 2026 (refer to Note 5 - Reverse Mortgages). Subsequent to closing, we will not record any further gain on the sold reverse loans and HMBS related borrowings, net, and we will begin to recognize subservicing fee revenue. MSR valuation adjustments, net - Our net MSR fair value changes include two main components. First, amortization of our investment is a function of the UPB and fair value of the MSR. We expect the MSR realization of cash flows to generally follow the growth of our MSR portfolio net of ESS financing liabilities and pledged MSR liabilities. Second, MSR fair value changes net of hedging are driven by changes in inputs and assumptions, our hedge coverage ratio and hedge performance. We expect MSR fair value changes due to interest rates to be largely offset by hedging derivatives to the extent of our hedge coverage ratio, with increased uncertainties related to input and assumption updates, hedge performance and hedge cost in an environment of higher economic and capital market volatility. Operating expenses - Compensation and benefits are a significant component of our cost-to-service and cost-to-originate and is directly correlated to headcount levels. Headcount in Servicing is primarily driven by the number of loans or UPB being serviced and subserviced, and by the relative mix of performing, delinquent and defaulted loans. As servicing volume is expected to modestly increase with relatively more performing loans (see above), we expect a reduced workforce with productivity gains. We have reduced and expect to further reduce our headcount and operating expenses as a result of the termination of our subservicing agreements with Rithm that accounted for approximately 5% of our total loan count and approximately 17% of total delinquent loans as of June 30, 2026 following the transfers to Rithm’s servicing platform in the first and second quarters of 2026 (19% and approximately 50% at December 31, 2025). We expect our Originations headcount and operating expenses to align with the expected growth in volume. Our operating expenses are expected to correlate with volumes, with some productivity and efficiencies expected through our technology and continuous improvement initiatives. Incentive compensation is also correlated to our share price and other performance metrics. Net interest expense - Interest expense varies based on changes in average debt balance and changes in short-term interest rates on our variable rate debt. The average balance of collateralized financing facilities trends with the balance of the underlying assets discussed above (including MSR, advances, loans and reverse buyouts). Interest expense on our warehouse facilities is expected to be largely offset by interest income on our Originations pipeline loans. Income tax expense - As a result of the partial release of the valuation allowance on deferred tax assets at December 31, 2025, we expect recognizing an income tax expense in 2026 and 2027 that tracks income before income taxes at an effective tax rate moderately higher than the U.S. combined Federal and state statutory tax rate. Stockholders’ equity - After consideration of the above factors, we expect our business to continue to generate net income and increase our equity in 2026 and 2027, absent any material adverse impact related to changes in interest rates, hedge performance and cost, execution of the Rithm servicing transfer and associated downsizing of our operations, regulatory changes, litigation, actions by government entities or GSEs, events which may disrupt the capital markets, or any other factors affecting our ability to execute our growth initiatives and plan. There can be no assurance that the desired strategic and financial impact of our actions will be realized. SEGMENT RESULTS OF OPERATIONS Our activities are organized into three reportable segments that reflect our primary lines of business - Servicing and Originations - as well as a Corporate segment. 67 SERVICING This segment is primarily comprised of our mortgage servicing and subservicing business. We earn servicing and subservicing fees, including ancillary income, and incur cost to service the loans which varies depending on delinquency status. We are exposed to MSR valuation adjustments and advancing obligations when we own the MSR. Our servicing portfolio includes conventional, government-insured and non-Agency mortgage loans, small-balance commercial and multi-family loans, and reverse mortgage loans reported on our balance sheet. As of June 30, 2026, we serviced 1.3 million mortgage loans with an aggregate UPB of $341.4 billion. In addition, the Servicing segment includes our wholly-owned captive reinsurance business (referred to as CRL), which provides re-insurance related to direct physical loss coverage on foreclosed real estate properties owned or serviced by us. CRL generally assumes a 90% quota share of insurance coverage written by a third-party insurer issued to OMC. Concentration We strive to diversify our revenue sources by maintaining a balanced portfolio of owned servicing and subservicing, and by extending our subservicing client base. The below graph displays the distribution of our serviced loans by relationship at June 30, 2026 (percentage of total loan count). We also measure and monitor concentration risk of our subservicing clients by their relative profitability contribution. On October 31, 2025, we were notified by Rithm of its intent to not renew its subservicing agreements effective January 31, 2026. The servicing transfers began in 2026 with the transfer of $1.2 billion RMSR UPB and $0.6 billion subservicing UPB on March 1, 2026. During the second quarter of 2026, we transferred an additional $21.2 billion of subservicing UPB. Upon transfer, we have downsized and expect to further downsize certain aspects of our servicing business as well as the related corporate support functions. Servicing and subservicing fees from Rithm amounted to $31.4 million, or 9% of total servicing and subservicing fees (excluding ancillary income) in the six months ended June 30, 2026 ($41.6 million and 13% in the six months ended June 30, 2025) and the related remittances to Rithm presented as Pledged MSR liability expense amounted to $15.1 million and $18.6 million in the respective periods. Rithm accounted for $8.0 billion or 2% and 5% of the total serviced UPB and loan count, respectively, of our servicing and subservicing portfolio as of June 30, 2026, and 17% of all delinquent loans that Onity serviced, for which the cost to service and the associated risks are higher ($33.8 billion, 11%, 20% and 59% as of June 30, 2025, respectively). As of June 30, 2026, OMC subserviced a total $37.7 billion UPB, or 11% of the UPB and 11% of the loan count of our total servicing and subservicing portfolio, on behalf of MAV. OMC recognized servicing and subservicing fees (excluding ancillary income) of $27.9 million (8% of total servicing and subservicing fees, excluding ancillary income) and the related remittances to MAV presented as Pledged MSR liability expense of $21.7 million in the six months ended June 30, 2026. MAV is a GSE MSR investment vehicle formed by Onity subsequently sold to Oaktree (85% sold in 2021, the remaining 15% in 2024). Through November 2029, OMC has the right to be the exclusive subservicer of MAV of all MSRs that MAV owned upon MAV sale in 2024, for all future MSRs that MAV acquires from OMC, and for the majority of MAV’s MSR portfolio overall. In addition, the parties agreed to lockout restrictions where MAV is restricted to sell or otherwise transfer MSRs owned by MAV at the MAV sale date in 25% increments through September 30, 2027. MAV may freely sell or transfer any MSRs thereafter. Loan Resolutions We are a leader in the servicing industry that is focused on creating positive outcomes for homeowners, clients and investors. Reducing delinquencies enables us to recover advances and recognize additional ancillary income such as late fees, which we do not recognize on delinquent loans until they are brought current. Loan resolution activities address the pipeline of 68 delinquent loans and generally lead to (i) modification of the loan terms, (ii) repayment plan alternatives, (iii) a discounted payoff of the loan (e.g., a “short sale”), or (iv) foreclosure or deed-in-lieu-of-foreclosure and sale of the resulting REO. To select an appropriate loan modification option for a borrower in accordance with the applicable servicing agreement, we perform a structured analysis, using a proprietary model, of all options using information provided by the borrower as well as external data, including recent broker price opinions to value the mortgaged property. Our proprietary model includes, among other things, an assessment of re-default risk. Advance Obligation As a servicer, we are generally obligated to advance funds in the event borrowers are delinquent on their monthly mortgage related payments. We advance principal and interest (P&I Advances), taxes and insurance (T&I Advances) and legal fees, property valuation fees, property inspection fees, maintenance costs and preservation costs on properties that have been foreclosed (Corporate Advances). For certain loans in non-Agency securitization trusts, we have the ability to cease making P&I advances and immediately recover advances previously made from the general collections of the respective trust if we determine that our P&I advances cannot be recovered from the projected future cash flows. With T&I and Corporate advances, we continue to advance if net future cash flows exceed projected future advances without regard to advances already made. Refer to Note 21 — Commitments for further discussion on our servicing advance obligations. Most of our advances have the highest reimbursement priority (i.e., they are “top of the waterfall”), so we are entitled to repayment from respective loan or REO liquidation proceeds before any interest or principal is paid on the bonds that were issued by the trust. In the majority of cases, advances in excess of respective loan or REO liquidation proceeds may be recovered from pool-level proceeds. The costs incurred in meeting these obligations consist principally of the interest expense incurred in financing the servicing advances. Most subservicing agreements, including our agreements with Rithm and MAV, provide for prompt reimbursement of any advances from the owner of the servicing rights. MSR Valuation Adjustments The financial performance of our Servicing segment is impacted by the changes in fair value of the MSR portfolio due to changes in market interest rates, among other factors. Our MSR hedging policy is designed to reduce the expected volatility of the MSR portfolio fair value due to market interest rates commensurate with the target hedge coverage ratio determined by our Market Risk Committee. Refer to Item 3. Quantitative and Qualitative Disclosures about Market Risk for further detail on our hedging strategy. We report all fair value changes of our MSR portfolio and MSR hedges within MSR valuation adjustments, net. MSR valuation adjustments, net includes the loss on the MSR portfolio associated with the realization of its expected cash flows, or runoff, due to the passage of time, and any fair value gains or losses due to inputs, market interest rates or assumptions, net of hedging gains and losses. Included in MSR valuation adjustments, net are fair value gains and losses of the MSR pledged liability associated with the MSR transfers that do not meet sale accounting and the ESS financing liabilities for which we elected the fair value option and that is collateralized by MSRs. Reverse Mortgages Our reverse business activities include both the subservicing of reverse mortgage loans on behalf of investors and the servicing of our owned portfolio. Owned portfolio loans are insured by the FHA, which provides protection against risk of borrower default, and are securitized through the Ginnie Mae program. Our servicing activities of reverse loans are generally consistent with forward mortgage loan servicing as described above, with the following additional functions: the funding of borrower advances or draws under their approved borrowing capacity and the repurchase of loans upon reaching a limit: a. Borrower draw funding obligation - Under the terms of adjustable-rate mortgage (ARM)-based HECM loan agreements, the borrowers have additional borrowing capacity. Borrower draws or tails are funded by the servicer and are securitized. We do not incur any substantive underwriting, marketing or compensation costs in connection with any future draws, although we must maintain sufficient capital resources and available borrowing capacity to ensure that we are able to fund these future draws prior to securitization with Ginnie Mae (generally less than 30 days). 69 b. Loan repurchase obligation - As an HMBS issuer, we are required to purchase loans out of the Ginnie Mae securitization pools once they reach 98% of the maximum claim amount (MCA buyouts). Active buyouts are assigned to HUD and payment is received from HUD through a claims process, generally within 30 days. HUD reimburses us for the outstanding principal balance on the loan up to the maximum claim amount; we bear the risk of exposure if the outstanding balance on a loan exceeds the maximum claim amount. We may carry loans for some time in anticipation of payoff or favorable liquidation if we deem the investment accretive. Inactive buyouts (loans that are in default for one of the following reasons - title conveyances or the borrower is deceased, no longer occupies the property or is delinquent on tax and insurance payments) are generally liquidated through foreclosure and subsequent sale of REO. State specific foreclosure and REO liquidation timelines have a significant impact on the timing and amount of our recovery. If we are unable to sell the property securing the inactive reverse loan for an acceptable price within the timeframe established by HUD (typically six months from obtaining marketable title of the property), we are required to make an appraisal-based claim to HUD. In such cases, HUD reimburses us for the loan balance, eligible expenses and interest, less the appraised value of the underlying property. Thereafter, all the risks and costs associated with maintaining and liquidating the property remain with us; we may incur additional losses on REO properties as they progress through the liquidation processes related to delayed timelines due to market conditions, sales commissions, property preservation costs or property tax and insurance advances. The significance of future losses associated with appraisal-based claims is dependent upon the volume of inactive loans, condition of foreclosed properties and the general real estate market. The Gain on reverse loans and HMBS-related borrowings, net reported within the Servicing segment includes the net fair value changes of securitized reverse mortgage loans and HMBS-related borrowings, which comprise the following: •contractual interest income earned on securitized reverse mortgage loans, or HECM loans, net of interest expense on HMBS-related borrowings, that is, on a net basis, the servicing fee we are contractually entitled to and collect on a monthly basis under the Ginnie Mae MBS Guide regarding servicing HMBS; and •other fair value changes of the net balance of securitized loans and HMBS-related borrowings, that effectively represents tails and servicing value. Tails are participations in previously securitized HECM loans and are created by additions to principal for borrower draws on lines-of-credit (scheduled and unscheduled), interest, servicing fees, and mortgage insurance premiums. The fair value of our Ginnie Mae securitized HECM loan portfolio net of HMBS-related Borrowings generally decreases as market interest rates rise and increases as market rates fall. The interest rate exposure is managed as part of our MSR hedging strategy (see Item 3 - Quantitative and Qualitative Disclosures About Market Risk, Reverse loans held for sale pooled into HMBS and HMBS-related Borrowings and the associated interest rate sensitivity disclosure). Gain (loss) on reverse loans and HMBS-related borrowings, net strictly reflects the financial performance of owned loans/servicing and excludes any subservicing activity. The financial performance associated with the subservicing of reverse mortgage loans on behalf of investors is primarily reflected within Servicing and subservicing fees, net. Since 2023, we have opportunistically acquired reverse mortgage assets (reverse buyouts) from financial institutions and companies, specifically active and inactive reverse mortgage loans, HUD claim receivables, and real estate properties. We finance our asset acquisitions along with the buyouts of our own portfolio through on-balance sheet private placement securitizations (referred to as OLIT). The financial performance of such reverse asset management is reported within the Servicing segment, largely within Gains (losses) on loans held for sale, which are driven by multiple factors, including liquidation timeline and changes in market interest rates. In November 2025, OMC agreed to sell its entire HECM loan portfolio and HMBS related borrowings to FAR and subservice the sold portfolio and additional loans from FAR. On April 30, 2026, OMC and FAR entered into an amendment of the November 2025 sale agreements whereby OMC has agreed to sell a portion of its reverse MSRs comprised of approximately 20,000 Ginnie Mae HECM loans. The amended sale was approved by Ginnie Mae on May 28, 2026 and the transaction closed on June 30, 2026. The subservicing agreement has an initial three-year term effective on the date of closing, subject to automatic one-year renewal unless FAR provides notice of non-renewal 180 days prior to the expiration of the original term, and subject thereafter to renewal upon mutual agreement of the parties. As of the closing date, the sold balances included $5.6 billion securitized assets ($5.2 billion UPB), the associated $5.5 billion HMBS-related borrowings (or net $70 million reverse MSR), and approximately $57 million newly originated reverse loans and tails pending securitization. Refer to Note 5 - Reverse Mortgages. 70 Third-Party Servicer Ratings Like other servicers, we are the subject of mortgage servicer ratings or rankings (collectively, ratings) issued and revised from time to time by rating agencies including Moody’s Investors Service, Inc. (Moody’s), S&P Global Ratings, Inc. (S&P) and Fitch Ratings, Inc. (Fitch). Favorable ratings from these agencies are important to the conduct of our loan servicing and lending businesses. The following table summarizes our latest key servicer ratings and outlook: OMC Moody’s S&P Fitch Forward Residential Prime Servicer SQ3+ Above Average RPS2- Residential Subprime Servicer SQ3+ Above Average RPS2- Residential Special Servicer SQ3+ Above Average RSS2- Residential Second/Subordinate Lien Servicer SQ2- Above Average RPS3+ Residential Home Equity Servicer — — RPS3+ Residential Alt-A Servicer — — RPS2- Master Servicer SQ3+ Above Average RMS3 Small Balance Commercial Primary and Special Servicer — Above Average SBPS2- and SBSS2- CMBS Loan Level Special Servicer, Master Servicer and Primary Servicer — — CLLSS3+, CMS3 and CPS3+ Ratings Outlook N/A Stable Stable Date of last action June 11, 2025 June 1, 2026 May 29, 2025 Reverse Residential Reverse Servicer — Above Average — Ratings Outlook — Stable — Date of last action — June 1, 2026 — In addition to servicer ratings, each of the agencies will from time to time assign an outlook (or a ratings watch such as Moody’s review status) to the rating status of a mortgage servicer. A negative outlook is generally used to indicate that a rating “may be lowered,” while a positive outlook is generally used to indicate a rating “may be raised.” On May 29, 2025, Fitch upgraded OMC’s residential servicer ratings and affirmed its stable outlook for all products. In addition, Fitch affirmed OMC’s residential Master Servicer rating. The rating actions reflect the company’s growth strategy based on diversification between its loan origination and servicing businesses as well as its third-party subservicing efforts, effective enterprise risk management controls and processes, and continuous technology enhancements. On June 11, 2025, Moody's upgraded the second lien servicer quality (SQ) assessment from SQ3+ to SQ 2- and affirmed the prime, subprime, special servicer, and master SQ assessments for OMC at SQ3+. The upgrade of OMC 's second lien servicing assessment is mainly driven by i) improvement in the company's second lien roll rates, ii) cure rates, and iii) recidivism rates. On June 1, 2026, S&P affirmed the Above Average ratings and Stable outlook citing the company’s experienced management, sound control environment, and well-designed information technology infrastructure and applications, among other factors. 71 Operating Metrics The following table provides selected operating statistics for our Servicing segment: Selected Operating Statistics June 30, March 31, % Change June 30, % Change 2026 2026 2025 Assets Serviced Unpaid principal balance (UPB) in billions: Performing loans (1) $ 330.8 $ 326.0 1 % $ 299.0 11 % Non-performing loans 10.3 12.0 (14) 10.1 2 Non-performing real estate 0.3 0.5 (40) 0.4 (25) Total $ 341.4 $ 338.4 1 % $ 309.5 10 % Non-performing to total % 3.1 % 3.7 % (16) % 3.4 % (9) % Conventional loans $ 250.3 $ 231.1 8 % $ 214.0 17 % Government-insured loans 50.9 47.9 6 40.4 26 Non-Agency loans 40.2 59.5 (32) 55.2 (27) Total $ 341.4 $ 338.4 1 % $ 309.5 10 % Conventional loans to total % 73.3 % 68.3 % 7 % 69.1 % 6 % Servicing portfolio - Owned MSR (2) $ 182.6 $ 176.2 4 % $ 155.4 18 % Servicing portfolio - Transferred MSR (3) 30.9 37.2 (17) % 39.0 (21) % Subservicing portfolio Subservicing - forward (4) 110.8 112.4 (1) % 101.8 9 % Subservicing - commercial 6.4 6.1 5 % 5.1 25 % Subservicing - reverse 10.7 6.4 67 8.2 30 Total subservicing 127.9 124.9 2 115.1 11 Total $ 341.4 $ 338.4 1 % $ 309.5 10 % Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Prepayment speed (CPR) % Voluntary CPR 7.6 % 8.4 % (10) % 8.0 % 5.2 % 54 % % Involuntary CPR 0.2 0.3 (33) 0.3 0.3 — % Total CPR (6) 10.9 % 11.9 % (8) % 11.4 % 8.8 % 30 % Number of completed modifications (in thousands) 3.0 2.5 20 % 5.5 10.2 (46) % MSR weighted average note rate (5) 5.0 % 4.8 % 4 % 4.9 % 4.4 % 11 % n/m: not meaningful (1)Performing loans include those loans that are less than 90 days past due and those loans for which borrowers are making scheduled payments under loan modification, forbearance or bankruptcy plans. We consider all other loans to be non-performing. (2)Includes HECM reverse mortgage loans with a UPB of $3.6 billion that are recognized in our unaudited consolidated balance sheet at June 30, 2026. 72 (3)Loans serviced pursuant to our sale or transfer agreements with MSR capital partners for which sale accounting is not achieved. Includes $6.8 billion serviced for Rithm at June 30, 2026. (4)Includes $1.2 billion UPB of subserviced loans on behalf of Rithm at June 30, 2026. (5)Related to our owned MSR forward servicing portfolio. (6)Total CPR includes voluntary and involuntary prepayments, as shown in the table, plus scheduled principal amortization. The following table provides the rollforward of activity of our portfolio of mortgage loans serviced that includes MSRs, whole loans and subserviced loans, both forward and reverse: Amount of UPB ($ in billions) Count (000’s) 2026 2025 2026 2025 Portfolio at January 1 $ 328.3 $ 301.7 1,425.7 1,395.1 Additions (1) (2) 28.5 16.5 87.3 56.7 MSR sales (3) (1.3) — (6.2) (0.1) Servicing transfers (1) (2) (3) (6.4) (6.9) (30.0) (45.7) Runoff (10.6) (6.6) (31.2) (24.0) Portfolio at March 31 338.4 304.6 1,445.7 1,382.0 Additions (1) 42.1 15.1 139.9 45.0 MSR sales (4) (5.2) — (20.3) (0.1) Servicing transfers (1) (4) (23.2) (1.4) (183.7) (4.3) Runoff (10.7) (8.8) (33.6) (33.8) Portfolio at June 30 $ 341.4 $ 309.5 1,348.0 1,388.9 (1)Includes the volume of UPB associated with short-term interim subservicing for some clients as a support to their originate-to-sell business, where loans may be boarded and deboarded within the same quarter. (2)Includes MSRs acquired in the first quarter of 2026 with a UPB of $2.5 billion for which we were previously performing the subservicing. (3)Includes MSRs sold in the first quarter of 2026 with a UPB of $1.3 billion for which we started performing subservicing. (4)Includes $5.2 billion HECM reverse MSR sale and subservicing addition in connection with the FAR transaction. We began subservicing these loans effective with the closing of the amended sale transaction on June 30, 2026. The following table provides a breakdown of our servicer advances, net of allowance for losses: June 30, 2026 December 31, 2025 Advances by investor type Principal and Interest Taxes and Insurance Foreclosures, Bankruptcy, REO and Other Total Principal and Interest Taxes and Insurance Foreclosures, Bankruptcy, REO and Other Total Conventional $ 0.7 $ 34.4 $ 7.7 $ 42.8 $ 1.1 $ 74.9 $ 6.2 $ 82.2 Government-insured 3.2 27.8 29.1 60.1 2.0 38.9 22.5 63.3 Non-Agency 75.5 109.2 81.9 266.6 95.6 165.1 77.3 337.9 Total, net $ 79.4 $ 171.4 $ 118.7 $ 369.5 $ 98.7 $ 278.8 $ 106.0 $ 483.4 73 The following table provides selected operating statistics related to our owned reverse mortgage loans held for sale pooled into HMBS, previously, held for investment reported within our Servicing segment: June 30, March 31, % Change June 30, % Change 2026 2026 2025 Reverse Mortgage Loans Unpaid principal balance (UPB) in millions: Reverse mortgage loans (1) $ 3,552.4 $ 9,059.1 (61) % $ 9,961.1 (64) % Active Buyouts (2) 551.9 580.6 (5) 205.0 169 Inactive Buyouts (2) 1,482.9 983.7 51 546.3 171 Total $ 5,587.2 $ 10,623.5 (47) % $ 10,712.4 (48) % Future draw commitments (UPB) in millions: 1,661.1 2,891.9 (43) % 3,000.2 (45) % Fair value in millions: Reverse mortgage loans (1) $ 3,627.1 $ 9,533.2 (62) % $ 10,341.3 (65) % HMBS related borrowings 3,610.9 9,437.4 (62) 10,253.1 (65) Net asset value (HECM or reverse MSR) $ 16.2 $ 95.8 (83) % $ 88.3 (82) % Net asset value to UPB 0.46 % 1.06 % 0.89 % (1)Excludes unsecuritized loans reported within the Originations segment. Classified as loans held for sale, at fair value at March 31, 2026 and December 31, 2025, and previously classified as loans held for investment. See Note 5 - Reverse Mortgages. (2)Buyouts are reported as Loans held for sale, Receivables or REO depending on the loan and foreclosure status. 74 Financial Performance The following table presents selected results of operations of our Servicing segment. The amounts presented are before the elimination of balances and transactions with our other segments: Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Revenue Servicing and subservicing fees $ 229.3 $ 222.4 3 % $ 451.7 $ 414.6 9 % Gain on reverse loans and HMBS-related borrowings, net 2.2 14.2 (85) 16.5 22.8 (28) Gain (loss) on loans held for sale, net (3.6) (2.7) 33 (6.3) (8.8) (28) Other revenue, net 5.7 6.5 (12) 12.2 9.7 26 Total revenue 233.6 240.3 (3) % 474.1 438.3 8 % MSR valuation adjustments, net (83.1) (80.5) 3 % (163.6) (73.3) 123 % Operating expenses Compensation and benefits 21.8 23.2 (6) % 45.0 46.0 (2) % Servicing expense 17.8 15.2 17 33.0 22.2 49 Technology and communications 8.2 8.3 (1) 16.4 14.9 10 Professional services 7.2 7.3 (1) 14.5 7.4 96 Occupancy, equipment and mailing 6.4 7.2 (11) 13.7 14.1 (3) Corporate overhead allocations 14.6 14.7 (1) 29.3 25.5 15 Other expenses 0.2 0.2 — 0.4 1.1 (64) Total operating expenses 76.2 76.1 — % 152.3 131.2 16 % Other income (expense) Interest income 24.9 18.0 38 % 42.9 23.5 83 % Interest expense (71.6) (58.5) 22 (130.1) (98.9) 32 Pledged MSR liability expense (38.2) (42.6) (10) (80.9) (85.0) (5) Other, net (2.2) (0.6) 267 (2.8) 0.3 n/m Other income (expense), net (87.1) (83.7) 4 % (170.9) (160.2) 7 % Income (loss) before income taxes $ (12.8) $ — n/m $ (12.7) $ 73.5 (117) % Income (loss) before income taxes to UPB (bps)-Annualized (1) — n/m (1) 5 (120) % Average serviced UPB ($ billions) $ 341.4 $ 334.0 2 % $ 337.6 $ 305.9 10 % Average headcount - Servicing 2,505 2,681 (7) 2,593 2,913 (11) n/m: not meaningful 75 Servicing and Subservicing Fees The following chart displays servicing and subservicing fees by component for the periods presented: The following table and discussion present the drivers of servicing and subservicing fees. Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Servicing fees Average servicing UPB (1) $ 206.6 $ 197.8 4 % $ 202.2 $ 178.1 14 % Average servicing fee (2) 0.29 0.30 (3) 0.30 0.30 — Servicing fees (3) $ 150.0 $ 148.9 1 % $ 298.9 $ 264.2 13 % Subservicing fees (6) Average number of subserviced loans (4) 542.9 583.7 (7) % 561.0 569.9 (2) % Average monthly fee per loan (5) $ 16 $ 15 7 $ 15 $ 14 7 Subservicing fees (3) $ 25.7 $ 26.0 (1) % $ 51.7 57.6 $ 49.5 4 % (1) In $ billions, (2) In % of UPB, annualized, (3) In $ millions, (4) In thousands, (5) In dollars. (6) Includes reverse mortgage loan subservicing. Servicing fees for the three months ended June 30, 2026 increased $1.1 million or 1% compared to the three months ended March 31, 2026, driven by a 4% increase in average servicing UPB. The increase in average servicing UPB is primarily due to robust originations and recapture, and selective bulk MSR acquisitions as part of our replenishment and growth initiative, partly offset by deboarding of $1.2 billion UPB Rithm loans in the first quarter of 2026 as a result of Rithm’s decision to not renew its agreements effective January 31, 2026. Subservicing fees remained flat quarter over quarter, with a 7% decrease in subservicing volume (loan count), primarily due to deboarding of $21.2 billion UPB Rithm loans in the second quarter of 2026, largely offset by an increase in our forward subservicing volume due to our successful enterprise sale efforts to grow our residential and commercial subservicing portfolio by 10%, net of portfolio runoff. Compared to the six months ended June 30, 2025, servicing fees for the six months ended June 30, 2026 grew 13% or $34.7 million, driven by a 14% increase in average servicing UPB, primarily due to robust originations and recapture, selective bulk MSR acquisitions as part of our replenishment and growth initiative, partly offset by the deboarding of $1.2 billion UPB Rithm loans in the first quarter of 2026 as a result of Rithm’s decision to not renew its agreements effective January 31, 2026. Subservicing fees remained largely flat (increased $2.1 million or 4%) as compared to the six months ended June 30, 2025, with certain offsetting factors, including higher price mix, an increase in our forward subservicing portfolio due to our successful enterprise sale efforts to grow our residential and commercial subservicing portfolio by 23%, net of portfolio runoff, partly offset by the deboarding of $21.2 billion and $5.7 billion UPB Rithm loans, in the second quarter of 2026 and first quarter of 2025, respectively, and runoff of our reverse subservicing portfolio. 76 The following table presents the composition of our ancillary income: Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Custodial accounts (float earnings) $ 36.5 $ 30.1 21 % $ 66.7 $ 59.4 12 % Late charges 9.0 9.9 (9) 18.8 19.4 (3) Reverse subservicing ancillary fees 1.7 2.1 (19) 3.8 6.5 (42) Other 6.4 5.4 19 11.8 15.5 (24) Ancillary income $ 53.6 $ 47.5 13 % $ 101.1 $ 100.8 — % ​ Ancillary income for the three months ended June 30, 2026 increased by $6.1 million, or 13% compared to the three months ended March 31, 2026 primarily due to a $6.4 million increase in float earnings attributable to seasonally higher average float balances. Compared to the six months ended June 30, 2025, ancillary income for the six months ended June 30, 2026 remained flat, with some offsetting factors. Float earnings increased $7.3 million due to higher average float balances partly offset by lower average interest rates (as a benchmark, the average 1-month term SOFR declined by 67 basis points). The increase in float earnings was offset by a $2.7 million decline in reverse subservicing ancillary fees driven by portfolio runoff, and $3.6 million lower other fees mainly driven by lower collection fees. Gain (Loss) on Loans Held for Sale, Net We recognized a $3.6 million loss on loans held for sale, net for the three months ended June 30, 2026, compared to a $2.7 million loss in the three months ended March 31, 2026. The $0.8 million unfavorable variance is mostly driven by reverse mortgage buyouts, with unfavorable input and assumption updates in the second quarter of 2026, partly offset by higher liquidation gains. During the three months ended June 30, 2026, we recorded higher redelivery gains on Ginnie Mae forward loan repurchases and modifications, mostly driven by volume. We recognized a $6.3 million loss on loans held for sale, net for the six months ended June 30, 2026, compared to an $8.8 million loss recognized in the six months ended June 30, 2025. The $2.5 million favorable variance is mostly driven by higher liquidation gains on reverse mortgage buyouts and higher redelivery gains on Ginnie Mae forward loan repurchases and modifications, mostly driven by volume, offset in part by certain higher input and assumption updates in the six months ended June 30, 2026. Gain (Loss) on Reverse Loans and HMBS-Related Borrowings, Net The following table presents the components of the fair value change of reverse loans and HMBS-related borrowings, net. Three Months Ended Six Months Ended June 30, March 31, % Change June 30, June 30, % Change 2026 2026 2026 2025 Net interest income (servicing fee) $ 7.0 $ 7.2 (3) % $ 14.2 $ 16.4 (13) % Other change in fair value of securitized loans and HMBS-related borrowings, net (7.1) 4.6 (254) (2.5) 6.4 (139) HECM hedging derivative gains (losses) (1) 2.4 2.4 — 4.8 — n/m Gain on reverse loans and HMBS-related borrowings, net (Servicing) $ 2.2 $ 14.2 (85) % $ 16.5 $ 22.8 (28) % (1)Effective fourth quarter of 2025, other change in fair value is partially hedged with dedicated third-party derivative instruments, and with our forward MSR hedge strategy through third quarter of 2025. 77 Gain on reverse loans and HMBS-related borrowings, net for the three months ended June 30, 2026 decreased $12.0 million, compared to the three months ended March 31, 2026, mostly driven by less favorable yield spread tightening in the second quarter of 2026 and unfavorable assumption updates, including related to the FAR transaction. While not the only benchmark for the reverse mortgage exposure, the 10-year Treasury rate increased 14 basis points during the second quarter of 2026 and increased 12 basis points during the first quarter of 2026. Net interest income remained mostly flat (-3%), consistent with the average portfolio balance. Compared to the six months ended June 30, 2025, Gain on reverse loans and HMBS-related borrowings, net for the six months ended June 30, 2026 declined $6.3 million mostly driven by the favorable impact from a decrease in market rates during the six months ended June 30, 2025 and a decrease in net interest income in the six months ended June 30, 2026, largely offset by changes in spreads (more favorable tightening vs. the prior year period) and assumptions, including related to the FAR transaction. The 10-year Treasury rate increased 26 basis points during the six months ended June 30, 2026 compared to a decrease of 34 basis points during the six months ended June 30, 2025. As our HECM loan portfolio is predominantly comprised of ARMs, lower interest rates cause the loan balance to accrue and reach the 98% maximum claim amount liquidation at a slower pace, extending the life of the servicing net asset. Net interest income declined $2.1 million (or 13%), consistent with the portfolio decline. Other Revenue, Net Other revenue, net for the three months ended June 30, 2026 was mostly flat as compared to the three months ended March 31, 2026, consistent with our CRL captive reinsurance premium portfolio. Compared to the six months ended June 30, 2025, Other revenue, net for the six months ended June 30, 2026 increased $2.4 million mostly driven by the growth of our CRL captive reinsurance premium portfolio with an increase in covered properties. MSR Valuation Adjustments, Net Refer to the discussion above within Overview-Results of Operations and Financial Condition-MSR Valuation Adjustments, Net. The following chart summarizes the impact of our MSR interest rate hedging strategy on Servicing segment results along with the impact of fair value changes due to other input and assumption updates (refer to the MSR Hedging Strategy section of Item 3. Quantitative and Qualitative Disclosures about Market Risks for further detail). As displayed below, our net income (total) is impacted by the combined effect of the fair value changes of the MSR portfolio attributable to input and assumption changes (including interest rates), the MSR hedging derivative gains and losses - both reported within MSR valuation adjustments, net on the face of the consolidated statement of operations - and other fair value changes of the HECM loans and HMBS-related borrowings (reverse exposure) used as a hedge for risk management purposes but separately presented on our consolidated statement of operations as Gain on reverse loans and HMBS-related borrowings, net through the third quarter of 2025. While our risk management hedging strategy is targeted towards changes in fair value due to interest rates, the information below portrays all fair value changes due to inputs and assumptions, including interest rates. ☐ MSR fair value changes due to interest rate changes (reported within the Servicing segment) ☐ MSR fair value changes due to input and assumption changes (reported within the Servicing segment) ☐ MSR hedging derivative fair value changes ☐ Other change in fair value of securitized reverse mortgage loans and HMBS-related borrowings, net (through Q3 of 2025) 78 With a high targeted hedge coverage ratio, the fair value volatility of the MSR portfolio due to changes in market interest rates, net of hedges (including the reverse exposure) was reduced for the periods presented. The total impact of our MSR hedge strategy resulted in losses of $29.4 million in the second quarter of 2026 and $27.1 million in the first quarter of 2026, with the variance driven by an unfavorable impact of market interest rate changes, net of hedging, vs. a favorable impact in the first quarter of 2026, largely offset by less unfavorable MSR valuation input and assumption updates, including to reflect slower prepayment speeds in the current quarter. The $74.1 million unfavorable change for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 ($56.5 million loss compared to $17.6 million gain), is mainly driven by unfavorable input and assumption updates in the six months ended June 30, 2026 vs. favorable updates in the six months ended June 30, 2025 primarily due to increased prepayment speeds in the first half of 2026 and higher realization of cash flows in the first half of 2026 mostly due to portfolio growth, partly offset by higher unfavorable market rate impact, net of hedging, in the first half of 2025. Compensation and Benefits Compensation and benefits expense for the three months ended June 30, 2026 decreased $1.4 million, or 6%, compared to the three months ended March 31, 2026 largely consistent with the 7% reduction in headcount. Salaries and benefits expense decreased $1.0 million and severance expense decreased $1.2 million, mostly due to 7% lower headcount in forward servicing primarily in connection with Rithm’s decision to not renew its subservicing agreements effective January 31, 2026. These decreases were partially offset by an increase in incentive compensation of $0.8 million. Compared to the six months ended June 30, 2025, Compensation and benefits expense for the six months ended June 30, 2026 remained flat (decreased $1.0 million, or 2%), mostly driven by the impact of an 11% headcount reduction. Decreases in salaries and benefits expense of $2.6 million and incentive compensation of $1.1 million were mostly offset by a $2.4 million increase in severance expense, primarily as a result of the termination of our subservicing agreements with Rithm (as disclosed above). The decrease in average headcount, including a 9% decrease in the U.S., is largely attributed to the Rithm subservicing agreements termination, runoff of our reverse subservicing portfolio, lower delinquencies, and further efficiency gains within forward servicing. Servicing Expense Servicing expense primarily includes claim losses and interest curtailments on government-insured loans (provision for account receivables), provision expense for advances and servicing representation and warranties, other provision expense (including related to CRL), and certain loan-volume related expenses. Servicing expense increased $2.6 million in the three months ended June 30, 2026 compared to the three months ended March 31, 2026, largely driven by $3.5 million higher indemnification provision expense, primarily driven by loan put-back and related contingencies related to the FAR transaction, offset in part by $1.0 million higher provision expense on receivables in the first quarter of 2026 related to MSR sales. Compared to the six months ended June 30, 2025, Servicing expense for the six months ended June 30, 2026 increased $10.8 million or 49%, primarily due to a $6.8 million increase in satisfaction and interest on payoff expense due to higher payoff volume, $3.0 million higher indemnification provision expense mostly due to the same factors described above, and $1.7 million higher provision expense on receivables related to MSR sales discussed above. Other Operating Expenses Other operating expenses (total operating expenses less Compensation and benefit expense and Servicing expense) for the three months ended June 30, 2026 remained flat (decreased $1.1 million, or 3%) as compared to the three months ended March 31, 2026, mostly due to a $0.8 million decrease in Occupancy, equipment and mailing expense. Compared to the six months ended June 30, 2025, Other operating expenses for the six months ended June 30, 2026 increased $11.4 million mostly due to a $7.1 million increase in Professional services expense, a $3.8 million increase in Corporate overhead allocations, and a $1.6 million increase in Technology and communications expense. The increase in Professional services expense is driven by $3.9 million higher legal expenses primarily due to lower recoveries of prior years’ legal expenses in the first half of 2026 and a $3.2 million increase in other professional services expense primarily due to an increase in call center volume driven by the Rithm servicing transfer. The increase in Corporate overhead allocations is primarily driven by higher Corporate services to support our growth initiatives. The increase in Technology and communications expense is primarily driven by higher servicing volume. 79 Other Income (Expense) Other income (expense) primarily includes net interest expense and pledged MSR liability expense. Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Interest Expense MSR financing facilities $ 25.4 $ 20.9 22 % $ 46.3 $ 40.2 15 % Advance match funded liabilities 5.9 6.2 (5) % 12.1 15.7 (23) % Reverse mortgage securitization notes 24.8 16.9 47 41.7 20.2 106 Mortgage warehouse facilities 1.9 2.5 (24) 4.3 7.0 (39) Corporate debt interest expense allocation 11.7 10.3 14 22.0 12.7 73 Escrow 1.9 1.7 12 3.7 3.3 12 Total interest expense $ 71.6 $ 58.5 22 % $ 130.1 $ 98.9 32 % Average balances MSR financing facilities $ 1,489.2 $ 1,230.2 21 % $ 1,360.4 $ 1,095.9 24 % Advance match funded liabilities 253.2 286.4 (12) 269.7 348.7 (23) Reverse mortgage securitization notes 1,423.0 875.2 63 1,150.6 456.3 152 Mortgage warehouse facilities 116.2 140.4 (17) 128.3 198.9 (35) Total asset-backed financing $ 3,281.6 $ 2,532.1 30 % $ 2,909.0 $ 2,099.9 39 % Effective average interest rate MSR financing facilities 6.82 % 6.79 % — % 6.80% 7.33 % (7) % Advance match funded liabilities 9.33 8.70 7 9.00 8.98 — Reverse mortgage securitization notes 6.98 7.70 (9) 7.25 8.85 (18) Mortgage warehouse facilities 6.39 7.01 (9) 6.73 7.04 (4) Average 1 month Term SOFR 3.64 % 3.67 % (1) % 3.65% 4.32 % (16) % Interest expense for the three months ended June 30, 2026 increased $13.1 million, or 22% compared to the three months ended March 31, 2026 driven by the growth of our assets, partly offset by lower effective interest (amortization of discount) on our reverse mortgage securitization notes primarily due to slower repayments. Interest expense on corporate debt increased $1.3 million as additional corporate debt was allocated to the Servicing segment in the first quarter of 2026, upon issuance of an additional $200.0 million of Senior Notes Due 2029 by PHH Corporation on January 30, 2026, to support the growth of MSRs. Interest expense on MSR financing facilities increased $4.5 million on a higher average balance due to higher utilization attributed to the growth of MSRs. Interest expense on reverse mortgage securitization notes increased $8.0 million mainly due to the significant increase in the average balance as a result of the acquisition and securitization (OLIT) of reverse mortgage buyouts in the first and second quarter of 2026, offset in part by runoff of the existing securitized portfolio and lower effective interest. Compared to the six months ended June 30, 2025, interest expense for the six months ended June 30, 2026 increased $31.1 million, or 31%, driven by the growth of our assets, partly offset by lower financing cost due to lower interest rates. Interest expense on reverse mortgage securitization notes increased $21.5 million mainly due to the acquisition and securitization (OLIT) of reverse mortgage buyouts in 2025 and the first and second quarter of 2026, offset in part by runoff of the existing securitized portfolio and lower effective interest (amortization of discount) primarily due to slower repayments. Interest expense on corporate debt increased $9.4 million, driven by additional corporate debt allocated to the Servicing segment during the six months ended June 30, 2026 to support the growth of MSRs. In addition, interest expense on MSR facilities increased $6.1 million due to an increase in the average debt balance, partly offset by lower average short-term market interest rates. 80 These increases were partially offset by a $3.5 million decrease in interest on advance match funded liabilities, mostly driven by the decline in average debt balances for servicing advances due to lower delinquencies and increased loan resolutions in our non-Agency MSR portfolio. The interest on mortgage warehouse facilities decreased $2.7 million, mostly driven by a decrease in the average debt balance due to the increase in OLIT securitizations as a financing structure option. Interest income for the three months ended June 30, 2026 increased $6.9 million compared to the three months ended March 31, 2026. Compared to the six months ended June 30, 2025, interest income increased $19.4 million for the six months ended June 30, 2026. The increases are primarily due to the reverse mortgage buyouts acquired in 2025 and the first and second quarter of 2026, offset in part by run-off of the existing reverse mortgage buyouts. Pledged MSR liability expense includes the servicing fee remittance related to the MSR sales or transfers that do not meet sale accounting criteria and are presented on a gross basis in our consolidated financial statements, including the servicing spread remittance associated with our ESS financing liability at fair value. See Note 8 — MSR Related Financing Liabilities, at Fair Value to the Unaudited Consolidated Financial Statements. The following table provides the components of Pledged MSR liability expense: Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Net servicing fee remittance for MSR transfers that do not meet sale accounting (1) 25.6 29.8 (14) % 55.5 58.8 (6) % ESS servicing spread remittance 12.6 12.9 (2) 25.4 26.1 (3) Pledged MSR liability expense $ 38.2 $ 42.6 (10) % $ 80.9 $ 85.0 (5) % (1)See Note 8 — MSR Related Financing Liabilities, at Fair Value to the Unaudited Consolidated Financial Statements. The servicing fee and ancillary income collections on such transferred MSRs are recognized within Servicing and subservicing fees. Pledged MSR liability expense for the three months ended June 30, 2026 decreased $4.5 million, or 10% as compared to the three months ended March 31, 2026 consistent with the lower volume serviced, including Rithm. Compared to the six months ended June 30, 2025, Pledged MSR liability expense for the six months ended June 30, 2026 decreased $4.0 million, or 5%, consistent with the lower volume serviced, including Rithm. Other, net is mostly driven by the increase in reverse mortgage REO assets in connection with reverse mortgage loan buyouts. ORIGINATIONS We originate and purchase loans and MSRs through multiple channels. Loans generally conform to the underwriting standards of Fannie Mae or Freddie Mac (GSEs) or are government-insured (FHA, VA or USDA). We generally sell the loans in the secondary mortgage market through GSE and Ginnie Mae mortgage securitizations on a servicing retained basis. The Originations business generates a gain on sale of loans, which represents the difference between the origination or purchase value and the sale or securitization value of the loans, along with fee revenue. In 2025, we launched new products including second lien and Non-Qualified Mortgage (Non-QM) loans that we generally sell on a servicing released basis. We conduct our Originations business through the following channels: 1- Consumer Direct Our Consumer Direct channel for forward mortgage loans focuses on targeting existing servicing customers by offering them competitive mortgage refinance opportunities, where permitted by the governing servicing and pooling agreement. A portion of our servicing portfolio is susceptible to refinance activity during periods of declining interest rates. Origination recapture volume and related gains are a natural economic hedge, to a certain degree, to the impact of declining MSR values as interest rates decline. In addition to rate and term refinance activities, our Consumer Direct channel targets purchase mortgage loans, cash-out, debt consolidation, mortgage insurance premium reduction, and second lien loans. 81 While not all loans serviced are eligible for recapture, the note rate composition of our Agency MSR portfolio (UPB in $ billions) was as follows. The chart indicates a $58 billion portfolio of loans with an interest rate higher than 6% as of June 30, 2026 (with the 30-year fixed rate mortgage rate at 6.49%) presenting higher prepayment risk and recapture opportunity. 2- Correspondent Lending Our Correspondent lending channel drives the replenishment and growth of our MSR portfolio. We purchase closed loans that have been underwritten to investor guidelines from our network of correspondent sellers and sell and securitize them, on a servicing retained basis. We offer correspondent sellers the choice to take out mandatory or “best-efforts” contracts, under which the seller's obligation to deliver the mortgage loan becomes mandatory only when and if the mortgage is closed and funded. Additionally, we offer correspondent sellers the opportunity to leverage a non-delegated underwriting option for best-efforts deliveries. In 2025, we expanded the range of products to our correspondent sellers with the launch of Non-QM loans that we currently sell servicing released. We provide customary origination representations and warranties to investors in connection with our loan sales and securitization activities. We receive customary origination representations and warranties from our network of approved correspondent lenders. As of June 30, 2026, we have relationships with 699 approved correspondent sellers. 3- Reverse Originations We originate and purchase reverse mortgage loans through our retail, wholesale and correspondent lending channels, under the guidelines of the HECM reverse mortgage insurance program of the FHA. Loans originated under this program are generally insured by the FHA, which provides protection against risk of borrower default. As the securitizations of reverse mortgage loans do not achieve sale accounting treatment and the loans remain reported as Reverse loans (held for sale or held for investment) pooled into HMBS, at fair value together with the securitization HMBS-related borrowings, revenue mostly includes the fair value changes of the loan from lock date to securitization date that are reported in Gain on reverse loans and HMBS-related borrowings, net. In November 2025, OMC agreed to sell its entire HECM loan portfolio and HMBS related borrowings to FAR and subservice the sold portfolio. FAR agreed to acquire OMC’s originations pipeline of reverse mortgage loans and, for a period of five years, OMC will no longer originate reverse mortgages effective upon closing with the exception of activities relating to the recapture of existing HECM borrowers for HECM MSRs not sold to FAR. On April 30, 2026, OMC and FAR entered into an amendment of the November 2025 sale agreements whereby OMC has agreed to sell a portion of its reverse MSRs comprised of approximately 20,000 Ginnie Mae HECM loans with UPB of $5.1 billion. We received Ginnie Mae’s approval of the amended sale on May 28, 2026 and the transaction closed on June 30, 2026. Refer to Note 5 - Reverse Mortgages for additional information. 82 4- Co-Issue Programs We purchase MSRs through flow purchase agreements, the Agency Cash Window co-issue programs and bulk MSR purchases. The Agency Cash Window programs we participate in, and purchase MSR from, allow mortgage companies and financial institutions to sell whole loans servicing released to the respective agency and sell the MSR to the winning bidder. In addition, we partner with other originators to replenish our MSRs through flow purchase agreements. As of June 30, 2026, we have relationships with 535 approved sellers through the Agency Cash Window co-issue programs. We initially recognize our MSR originations and purchases with the associated economics in our Originations segment and transfer the MSR to our Servicing segment once the MSR is initially recognized on our balance sheet with all subsequent performance associated with the MSR, including funding cost, runoff and other fair value changes reflected in our Servicing segment. 5- Subservicing Growth We source additional servicing volume through our subservicing and interim servicing agreements, through our existing relationships and our enterprise sales initiatives. We do not report any revenue or gain associated with subservicing within the Originations segment as the impact is captured in the Servicing segment. However, sales efforts and certain costs - marginal compensation and benefits - are managed and reported within the Originations segment. 83 Operating Metrics The following table provides selected operating statistics for our Originations segment: Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Funded Loan UPB by Channel (in billions) Forward loans Correspondent $ 6.46 $ 5.82 11 % $ 12.27 $ 9.10 35 % Consumer Direct 1.20 1.19 1 2.39 0.68 251 $ 7.66 $ 7.01 9 % $ 14.66 $ 9.78 50 % GSE $ 3.83 $ 4.54 (16) % $ 8.37 $ 7.00 20 % Ginnie Mae 3.66 2.31 58 5.98 2.73 119 Other 0.16 0.15 7 0.31 0.04 675 $ 7.66 $ 7.01 9 % $ 14.66 $ 9.78 50 % % Purchase production 69 54 28 62 76 (18) % Refinance production 31 46 (33) 38 24 58 Weighted average note rate (%) 6.1% 6.0% 2 % 6.0% 6.4% (6) % Reverse loans (1) Correspondent $ 0.01 $ 0.04 (75) % $ 0.05 $ 0.20 (75) % Wholesale 0.01 0.03 (67) 0.04 0.09 (56) Retail 0.01 0.01 — 0.02 0.05 (60) $ 0.03 $ 0.08 (63) % $ 0.11 $ 0.34 (68) % UPB of MSR Purchases by Channel (in billions) Agency Cash Window / Flow MSR $ 7.76 $ 7.17 8% 14.94 $ 6.33 136% Bulk purchases 2.24 5.32 (58) 7.56 5.13 47 Bulk reverse purchases 0.73 0.38 92 1.11 — n/m $ 10.73 $ 12.87 (17) $ 23.61 $ 11.46 106 Total $ 18.42 $ 19.96 (8)% $ 38.38 $ 21.57 78% Short-term loan commitment (2) (at period end; in millions) Consumer Direct $ 459.5 $ 780.4 (41) % $ 459.5 $ 209.1 120 % Correspondent 1,846.4 1,927.3 (4) % 1,846.4 1,767.5 4 % Total Forward loans $ 2,305.9 $ 2,707.8 (15) % $ 2,305.9 $ 1,976.6 17 % Reverse loans 0.4 14.2 (97) % 0.4 33.0 (99) % Consumer Direct pull-through adjusted (PTA) lock volume (3) (in billions) $ 0.94 $ 1.35 (30) % $ 2.29 $ 0.73 214 % Consumer Direct gain on sale margin on PTA lock volume (4) 1.95 % 2.05 % (5) % 2.01 % 2.92 % (31) % 84 (1)Loan production excludes reverse mortgage loan draws by borrowers disbursed subsequent to origination that are reported within the Servicing segment. (2)Also refer to interest rate lock commitments in Note 15 – Derivative Financial Instruments and Hedging Activities. The amounts are presented before application of any pull-through adjustment. (3)Defined as interest rate lock commitments multiplied by pull-through rates and represents loan volume expected to be funded. (4)Represents Gain on loans held for sale, net divided by pull-through adjusted locked volume. Financial Performance The following table presents the results of operations of our Originations segment. The amounts presented are before the elimination of balances and transactions with our other segments: Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Revenue Gain on loans held for sale, net $ 33.0 $ 36.9 (11) % $ 69.8 $ 31.0 125 % Gain on reverse loans and HMBS-related borrowings, net 1.6 4.5 (64) 6.0 12.9 (53) Other revenue, net 14.7 12.6 17 27.3 14.2 92 Total revenue 49.3 53.9 (9) % 103.1 58.1 77 % MSR valuation adjustments, net 12.6 11.5 10% 24.1 7.2 235 % Operating expenses Compensation and benefits 21.1 20.8 1 % 41.9 26.2 60 % Origination expense 5.3 3.3 61 8.6 3.7 132 Technology and communications 3.1 2.8 11 5.9 4.3 37 Professional services 0.6 0.6 — 1.1 1.0 10 Occupancy, equipment, and mailing 1.3 0.8 63 2.1 1.5 40 Corporate overhead allocations 5.1 5.2 (2) 10.3 7.8 32 Other expenses 1.2 1.5 (20) 2.8 3.2 (13) Total operating expenses 37.7 35.0 8 % 72.7 47.9 52 % Other income (expense) Interest income 29.6 21.8 36 % 51.4 32.7 57 % Interest expense (25.7) (18.6) 38 (44.3) (31.0) 43 Other, net (0.7) (0.4) 75 (1.1) (0.5) 40 Other income (expense), net 3.2 2.8 14 % 6.0 1.2 400 % Income before income taxes $ 27.4 $ 33.2 (17) % $ 60.5 $ 18.6 225 % Income before income taxes to UPB (bps) 36 47 (23) 41 19 116 Funded loan UPB - Forward loans (in $ billions) $ 7.7 $ 7.0 10 $ 14.7 $ 9.8 50 Average Headcount - Originations 742 706 5 720 571 26 85 Gain on Loans Held for Sale, Net The following chart displays Gain on loans held for sale by channel for the periods presented: The following table and discussion present Gain on loans held for sale by channel and the main drivers, specifically the forward loan origination volumes and margins (excluding fees that are presented in Other revenue, net): Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Origination UPB (1) (in billions) Correspondent $ 6.46 $ 5.82 11 % $ 12.27 $ 9.10 35 % Consumer Direct 1.20 1.19 1 2.39 0.68 251 $ 7.66 $ 7.01 9 % $ 14.66 $ 9.78 50 % % Gain on Sale Margin (2) Correspondent 0.23 % 0.16 % 44 % 0.19 % 0.11 % 73 % Consumer Direct 1.52 2.33 (35) 1.92 3.13 (39) 0.43 % 0.53 % (19) % 0.48 % 0.32 % 50 % Gain on Loans Held for Sale Correspondent $ 14.7 $ 9.1 62 % $ 23.8 $ 9.6 148 % Consumer Direct 18.3 27.7 (34) 46.0 21.3 116 $ 33.0 $ 36.9 (11) % $ 69.8 $ 31.0 125 % (1)Defined as the UPB of loans funded in the period. (2)Ratio of gain on Loans held for sale to funded UPB. Note that the ratio differs from the day-one gain on sale margin upon lock. Gain on loans held for sale, net for the three months ended June 30, 2026 decreased $3.9 million, or 11% compared to the three months ended March 31, 2026, with a $9.4 million decrease in our Consumer Direct channel, partly offset by a $5.6 million increase in our Correspondent channel. The decrease in Consumer Direct gain is primarily driven by volume headwinds as higher rates drove 30% lower lock volumes and 35% lower margins. The increase in Correspondent gain is primarily driven by improved loan origination pipeline hedge effectiveness, higher margins, and favorable loan sale execution. Our total forward loan origination volume increased 9% consistent with our business growth strategy, exceeding estimated industry volume trend (up 4% quarter over quarter, based on average of MBA and Fannie Mae data). Compared to the six months ended June 30, 2025, Gain on loans held for sale, net for the six months ended June 30, 2026 increased $38.8 million, attributable to a $24.6 million increase in our Consumer Direct channel and $14.2 million increase in our Correspondent channel. The higher gain in Consumer Direct is primarily driven by a 251% increase in loan funded volume due to our increased recapture capabilities in the first half of 2026 which continued to drive refinance activity, offset in part by lower margins due to the competitive pricing environment. The $14.2 million increase in Correspondent gain is driven by a 35% increase in loan production volume, largely driven by continued diversification across all investors and expansion of the Non-QM loan portfolio, and a 73% increase in margins primarily attributable to improved execution. Our origination activity in 2026 has strategically shifted towards a higher mix of Ginnie Mae production, which offers higher margins and stronger recapture opportunities. The 50% increase in our total volume is mostly attributed to our MSR replenishment and growth strategy and largely exceeded the estimated industry volume trend (26% increase, based on average of MBA and Fannie Mae data). 86 Gain on Reverse Loans and HMBS-Related Borrowings, Net The following table provides information regarding Gain on reverse loans and HMBS-related borrowings, net, of the Originations segment that comprises fair value changes of the pipeline and unsecuritized reverse mortgage loans, at fair value, together with volume and margin (including loan fees): Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Origination UPB (1) (in billions) $ 0.03 $ 0.08 (63) % $ 0.12 $ 0.34 (65) % Origination margin (2) 5.33 % 5.44 % (2) 5.00 % 3.79 % 32 Gain on reverse loans and HMBS-related borrowings, net (Originations) $ 1.6 $ 4.5 (64) % $ 6.0 $ 12.9 (53) % (1)Defined as the UPB of loans funded in the period. (2)Ratio of origination gain to funded UPB; includes loan fees. Gain on reverse loans and HMBS-related borrowings, net for the three months ended June 30, 2026 decreased $2.9 million compared to the three months ended March 31, 2026, with lower origination volume across our channels and lower margins in our wholesale and retail channels. Lower originations during the three months ended June 30, 2026 were in anticipation of the closing of the amended sale agreement with FAR. Lower margins were predominantly driven by less favorable tightening of yield spreads in the three months ended June 30, 2026 as compared to the three months ended March 31, 2026. Compared to the six months ended June 30, 2025, Gain on reverse loans and HMBS-related borrowings, net for the six months ended June 30, 2026 decreased $6.9 million attributed to lower origination volume, partly offset by a higher aggregate margin. The elevated interest rate environment continues to adversely impact reverse mortgage borrower activities due to a lack of affordability as elevated rates directly reduce HECM loan proceeds available to borrowers. Anticipated closing of the amended sale agreement with FAR also contributed to our lower originations volume during the six months ended June 30, 2026. Higher aggregate margin is predominantly driven by more tightening in yield spreads in the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. Other Revenue, net Other revenue, net consists primarily of correspondent and broker fees and includes setup fees earned for loans boarded on our servicing platform. Changes in Other revenue, net for the periods presented are primarily attributed to production volume changes. MSR Valuation Adjustments, Net MSR valuation adjustments, net includes revaluation gains on certain MSRs opportunistically purchased through the Agency Cash Window programs, and flow purchases. As an aggregator of MSRs, we may purchase MSRs from smaller originators with a purchase price at a discount to fair value and we recognize valuation adjustments for differences in exit markets in accordance with the accounting fair value guidance. We record such valuation adjustments as MSR valuation adjustments, net within the Originations segment since the segment’s business objective is the sourcing of new MSRs at targeted returns. Changes in MSR valuation adjustments, net period over period are largely due to volume changes and higher margins driven by improved execution. Operating Expenses Operating expenses for the three months ended June 30, 2026 increased $2.6 million, or 7% compared to the three months ended March 31, 2026 primarily due to higher Consumer Direct volume (loan count) and increased provision for indemnification attributed to unfavorable demand and resolution activities, compared to the three months ended March 31, 2026, as well as an increase in commissions, partly offset by lower reverse originations related expenses due to the FAR transaction, as discussed above. Compared to the six months ended June 30, 2025, Operating expenses for the six months ended June 30, 2026 increased $24.8 million primarily due to a $15.6 million increase in Compensation and benefits driven by $8.6 million of higher commissions on higher production volume, as well as a $5.8 million, or 37% increase in salaries and benefits expense mostly due to a 26% increase in average headcount. In addition, Originations expense increased $4.9 million primarily due to higher production volume and unfavorable demand and resolution activities compared to six months ended June 30, 2025. Other operating expenses also increased $4.3 million primarily driven by a $2.4 million increase in corporate overhead allocations due to higher support costs to support higher production volume, and a $1.5 million increase in Technology and communications expense due to higher production volume. 87 Other Income (Expense) Interest income consists primarily of interest earned on newly originated and purchased loans during the pipeline period prior to securitization or sale to investors. Interest expense is incurred to finance the mortgage loans during the same pipeline period, which is generally approximately 20 days. We finance mortgage loans with repurchase and participation agreements, commonly referred to as warehouse lines generally indexed on short-term rates like SOFR. Our net interest margin is driven by the difference between the average mortgage note rate and the average warehouse line cost of funds, the average balance of loans and by the average number of days loans remain in the pipeline. The improvement in our net interest margin, year-over-year is attributable to the reduction of short-term interest rates relative to mortgage rates and the increase in the average pipeline loan balance. CORPORATE Corporate includes expenses of corporate support services and activities that are not directly related to other reportable segments. •Interest expense on corporate debt is allocated to the Servicing segment and the Originations segment based on relative financing requirements. The financing requirements of the Servicing and Originations segments reflects and is consistent with the financing needs of the licensed subsidiaries (OMC and PAS) that carry out these businesses. Interest expense on the unallocated portion of the $700.0 million 9.875% Senior Notes Due 2029 is retained in Corporate. •Certain expenses incurred by corporate support services, such as technology, legal, risk and compliance, and finance are allocated to the Servicing and Originations segments using various methodologies intended to approximate the utilization of such services. The following table presents selected results of operations of Corporate: Three Months Ended % Change Six Months Ended % Change June 30, March 31, June 30, June 30, 2026 2026 2026 2025 Revenue $ — $ — n/m $ — $ — n/m Operating expenses Compensation and benefits 26.9 25.7 5 % 52.6 46.1 14 % Technology and communications 6.6 6.4 3 13.1 11.2 17 Professional services 8.9 6.9 29 15.8 22.7 (30) Occupancy, equipment and mailing 0.5 0.5 — 0.9 0.7 29 Other expenses 1.9 1.4 36 3.4 2.9 17 Total operating expenses before corporate overhead allocations 44.8 40.9 10 % 85.8 83.7 3 % Corporate overhead allocations Servicing segment (14.6) (14.7) (1) % (29.3) (25.5) 15 % Originations segment (5.1) (5.2) (2) (10.3) (7.8) 32 Total operating expenses 25.1 21.0 20 % 46.2 50.4 (8) % Other income (expense), net Interest income 1.0 1.2 (17) % 2.2 2.1 5 % Interest expense (5.8) (5.6) 4 (11.3) (12.7) (11) Pledged MSR liability expense — — n/m 0.1 — n/m Other, net 0.2 0.1 100 0.3 0.8 (63) Other income (expense), net (4.6) (4.3) 7 % (8.7) (9.8) (11) % Loss before income taxes $ (29.7) $ (25.2) 18 % $ (54.9) $ (60.2) (9) % 88 Operating Expenses Operating expenses before corporate overhead allocations increased by $3.9 million, or 10% for the three months ended June 30, 2026 compared to the three months ended March 31, 2026, primarily driven by a $2.0 million increase in Professional services and a $1.2 million increase in Compensation and benefits. The increase in Professional services is mostly due to certain corporate development initiatives. The increase in Compensation and benefits is mostly attributed to higher incentive compensation partly offset by lower severance expense. The increase in incentive compensation is primarily driven by an increase in the fair value of cash-settled share-based awards driven by our stock price (1% increase in our stock price vs. a 14% decrease in the comparative period) and an increase in equity-settled awards expense. Operating expenses before corporate overhead allocations increased by $2.1 million, or 3% for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, with higher Compensation and benefits and increased Technology and communications expenses largely offset by lower Professional services. Compensation and benefits increased $6.5 million mostly due to higher salaries and benefits due to an increase in average headcount (mostly in the U.S.) to support growth initiatives. Technology and communications increased $1.8 million primarily due to increased technology usage, including higher cloud storage costs, and IT security and innovation-related projects. Professional services decreased $6.9 million mostly driven by a $7.7 million decrease in legal expenses, primarily attributed to the increase in our accrual for probable losses in the first quarter of 2025 in connection with the settlement of a legacy litigation matter. Corporate overhead allocations to the segments for the six months ended June 30, 2026 increased $6.2 million as compared to the six months ended June 30, 2025 primarily driven by higher support expenses for our growth initiatives and production volume. LIQUIDITY AND CAPITAL RESOURCES Overview In the normal course of business, we are actively engaged with existing and potential lenders and as a result add, terminate, replace or extend our debt agreements to the extent necessary to finance our operations and growth and optimize our financing costs. In addition, we completed the following key transactions during the six months ended June 30, 2026 impacting our liquidity: •Increased total borrowing capacity under our existing mortgage warehouse facilities by $1.2 billion to support increased originations. •Completed the following changes related to our MSR financing facilities: ◦In January 2026, we increased the borrowing capacity under our Ginnie Mae MSR facility from $400.0 million to $450.0 million. Also, in April 2026, the borrowing capacity was further increased from $450.0 million to $500.0 million. ◦In May 2026, we increased the borrowing capacity under one of our GSE MSR financing facilities from $250.0 million to $400.0 million and the maturity date was extended to May 2029. ◦In May 2026, we decreased the borrowing capacity under another of our GSE MSR facilities from $750.0 million to $400.0 million. ◦In May 2026, we entered into a new facility which is secured by a lien on certain of our Fannie Mae MSRs and is subject to daily margining requirements. Onity guarantees the obligations under the facility. The facility has a maturity date of May 2027 and total borrowing capacity of $450.0 million. In June 2026, the borrowing capacity under the facility was temporarily increased to $500.0 million through August 2026. In July 2026, we repaid $250.0 million of the balance outstanding under this facility and entered into a $250.0 million term loan facility secured by a lien on certain of our Fannie Mae MSRs with a maturity date of July 2029 and subject to daily margining requirements. Onity guarantees the obligations under the facility. •On January 30, 2026, PHH Corporation issued $200.0 million aggregate principal amount of 9.875% Senior Notes Due 2029. The Senior Notes were offered as an additional issuance of 9.875% Senior Notes Due 2029 and form a single series of debt securities with the $500.0 million aggregate principal amount of such notes that were originally issued on November 6, 2024. We opportunistically executed the debt offering to expand and strengthen our capital structure at attractive terms. We believe the transaction will provide greater financial flexibility to manage our leverage and invest in the growth of our business. The net proceeds from the offering will be used for general corporate purposes, including the repayment of MSR indebtedness and to support originations growth. •Completed three private placement securitizations (OLIT) of HECM loans, and related receivables and REO properties, referred to as reverse mortgage buyouts. In March, May and June 2026, certain classes of asset-backed 89 notes with an initial principal amount of $511.9 million, $499.9 million and $504.6 million, respectively, were issued at a discount, with a stated interest rate of 3% and a three-year mandatory call date. •Completed the repurchase and cancellation of $10.0 million (242,753 shares) of our common stock under a $10.0 million share repurchase program authorized by Onity’s Board of Directors in February 2026. We repurchased 154,444 of these shares during the first quarter and an additional 88,309 shares during the second quarter, completing the program on May 1, 2026. •Repurchased and cancelled $2.0 million (53,034 shares) of our common stock under a $20.0 million share repurchase program authorized by Onity’s Board of Directors in June 2026. The total monthly purchase limit for the program is $2.0 million. During July 2026, we completed the repurchase and cancellation of an additional $2.0 million (51,527 shares) of our common stock. In addition to the above transactions, on April 30, 2026, OMC and FAR entered into an amendment to the parties’ November 2025 agreements for the sale of Onity’s reverse mortgage servicing portfolio and certain reverse originations assets. Under the amendment, OMC has agreed to sell a portion of its reverse MSRs comprised of approximately 20,000 Ginnie Mae HECM loans, subject to Ginnie Mae approval and customary closing conditions. Effective as of the transaction closing date, FAR also agreed to acquire OMC’s pipeline of reverse mortgage loans as of the transaction closing date, and for a period of five years, OMC will no longer originate reverse mortgages with the exception of activities relating to the recapture of existing HECM borrowers for HECM MSRs not sold to FAR. The amended transaction was approved by Ginnie Mae on May 28, 2026 and closed on June 30, 2026. Refer to Note 5 - Reverse Mortgages and Note 10 – Receivables. Excluding the $6.8 million holdback, net cash related to the FAR transaction is approximately $77 million, net of repayment of certain warehouse financings, transaction costs, impact of removing the reverse MSR hedge, mortgage insurance premium, and post-closing items. A summary of borrowing capacity under our advance facilities, mortgage warehouse facilities and MSR financing facilities is as follows (see Note 12 – Borrowings to the Unaudited Consolidated Financial Statements for additional information): June 30, 2026 December 31, 2025 Total Borrowing Capacity (1) Remaining Borrowing Capacity - Committed (1) Remaining Borrowing Capacity - Uncommitted (1) Total Borrowing Capacity (1) Remaining Borrowing Capacity - Committed (1) Remaining Borrowing Capacity - Uncommitted (1) Advance facilities $ 814.4 $ 545.3 $ 14.4 $ 814.4 $ 458.6 $ 13.9 Mortgage warehouse facilities 4,340.6 295.9 1,983.0 3,184.3 231.9 1,727.8 MSR financing facilities 1,870.0 246.9 73.2 1,470.0 172.4 30.9 Total $ 7,025.0 $ 1,088.1 $ 2,070.6 $ 5,468.7 $ 862.9 $ 1,772.6 (1)Total Borrowing Capacity represents the maximum amount which can be borrowed, subject to eligible collateral. Remaining Borrowing Capacity represents Total Borrowing Capacity less outstanding borrowings, subject to eligible collateral. We may utilize borrowing capacity under our financing facilities to the extent we have sufficient eligible collateral to borrow against and otherwise satisfy the applicable conditions to funding. At June 30, 2026, we had $33.4 million total available borrowing capacity based on the amount of eligible collateral as follows: June 30, 2026 Total Committed Uncommitted Advance facilities $ — $ — $ — Mortgage warehouse facilities — — — MSR financing facilities 33.4 33.4 — Total available borrowing capacity based on eligible collateral $ 33.4 $ 33.4 $ — At June 30, 2026, our total liquidity of $230.0 million included $196.6 million of unrestricted cash and $33.4 million total available committed and uncommitted borrowing capacity based on the amount of eligible collateral as described above. With total liquidity of $205.0 million at December 31, 2025, the increase is mostly attributed to our issuance of an additional $200.0 million aggregate principal amount of 9.875% Senior Notes Due 2029, largely offset by our originations and investments in owned MSRs and semi-annual interest paid on the Senior Notes in May 2026. We manage our liquidity on a daily basis to fund our business and comply with debt covenants and regulatory liquidity requirements. Our liquidity position may vary significantly during a given month, generally with the lowest liquidity amount 90 around mid-month due to the cash flow remittance requirements under our servicing agreements and the highest around or a few days after month end as we collect monthly payments from borrowers. We optimize our daily cash position to reduce financing costs while closely monitoring our liquidity needs and ongoing funding requirements. We regularly monitor and project cash flows over various time horizons to anticipate and mitigate liquidity risk. We maintain liquidity buffers to be responsive to the level of risks, including liquidity peaks and troughs, stressed market interest rate conditions and operational risk. Use of Funds Our primary near-term uses of funds in the normal course include: •Payment of operating costs and corporate expenses; •Payments for servicing advances in excess of collections including advances and draws related to reverse mortgage assets (see below); •Investment in MSRs (purchased and originated) and other related asset acquisitions; •Originated, purchased and repurchased loans, including reverse mortgage buyouts; •Payment of margin calls under our MSR financing facilities and derivative instruments; •Debt service and repayments of borrowings, including under our MSR financing, advance financing, warehouse facilities and OLIT securitization notes, and payment of interest expense including on the Senior Notes Due 2029; •Dividend payments on Series B Preferred Stock; and •Net negative working capital and other general corporate cash outflows. We have short-term commitments to lend $2.3 billion in connection with our forward and reverse mortgage loan IRLCs outstanding at June 30, 2026. In addition, we have originated floating-rate reverse mortgage loans under which the borrowers have additional borrowing capacity of $1.7 billion at June 30, 2026. During the six months ended June 30, 2026, we funded $144.4 million of the $2.9 billion borrowing capacity available as of December 31, 2025. We are able to immediately securitize these borrower draws or advances under the Ginnie Mae program. As an HMBS issuer, we are required to repurchase loans out of the Ginnie Mae securitization pools once the outstanding principal balance of the loan is equal to or greater than 98% of the maximum claim amount (MCA repurchases). See Note 21 — Commitments for additional information. We carry these repurchases until reimbursement by HUD and/or property liquidation if inactive. Our reverse subservicing clients bear the financial obligation and risks associated with purchasing loans out of securitization pools within the portfolio we subservice. Our financing commitments related to reverse loans were assigned to FAR upon closing of our amended sale transaction on June 30, 2026; see Note 5 - Reverse Mortgages for additional information. Regarding the current maturities of our borrowings, as of June 30, 2026, we have approximately $3.4 billion of debt outstanding that would either come due, begin amortizing or require partial repayment in the next 12 months. This amount is primarily comprised of $2.1 billion of borrowings under warehouse facilities and $1.2 billion of borrowings under MSR financing facilities. With respect to liquidity management, we consider our servicing advance requirements during each investor remittance period and the uncertainties of daily margin calls on our collateralized debt facilities and derivative instruments due to interest rate fluctuations. As disclosed in Note 8 — MSR Related Financing Liabilities, at Fair Value, on October 31, 2025, we were notified by Rithm of its intent not to renew its subservicing agreements effective January 31, 2026 with transfers to Rithm’s own servicing platform beginning on March 1, 2026. The float amount associated with the advance collections and servicing fees of the servicing portfolio will be repaid to Rithm in cash based on the amount due upon transfer. Also refer to Note 13 – Other Liabilities (Due to Rithm - Advance collections and servicing fees - See Note 21). Based on quarter-end liquidity and ongoing business cash flows, we expect to meet the Rithm payable when due while maintaining adequate cash resources. As servicer, we are generally required to advance to investors the loan P&I installments not collected from borrowers for those delinquent loans, including those on forbearance plans. Loan payoffs and prepayments are a source of additional liquidity and are dependent on the interest rate environment. We also advance T&I and Corporate advances primarily on properties that are in default or have been foreclosed. Our obligations to make these advances are governed by servicing agreements or guides, depending on investors or guarantor. As subservicer, we are also required to make P&I, T&I and Corporate advances on behalf of servicers following the servicing agreements or guides. However, servicers are generally required to reimburse us within 30 days of our advancing under the terms of the subservicing agreements, and we are generally reimbursed by Rithm the same day we fund P&I advances, or within no more than three days for certain servicing advances. Refer to Note 21 — Commitments for further description of our servicer advance obligations. We are generally subject to daily margining requirements under the terms of our MSR financing facilities and daily cash calls for our TBAs, interest rate futures or other derivatives. While the objective of our hedging strategy is to reduce volatility 91 due to interest rates, it is also designed to address cash and liquidity considerations. Refer to the sensitivity analysis in Item 3. Quantitative and Qualitative Disclosures About Market Risk. Our medium- and long-term requirements for cash include: •Payment of interest and principal repayment of our Senior Notes Due 2029(1); •Payment of interest and principal repayment of our OLIT securitization note issuances that have a three-year mandatory call date; •Any payments associated with the confirmation of loss contingencies; and •Any other payments required under contractual obligations discussed above that extend beyond one year. (1)Supplemental information required pursuant to the Indenture governing the Onity Senior Notes Due 2029 disclosed in Exhibit 99.1. Sources of Funds Our primary sources of funds for near-term liquidity in the normal course include: •Collections of servicing and subservicing fees and ancillary revenues; •Collections of advances in excess of new advances; •Proceeds from match funded advance financing facilities; •Proceeds from other borrowings, including warehouse facilities, MSR financing facilities, MSR transfers and ESS financing; •Proceeds from sales and securitizations of originated loans and purchased loans; and •Net positive working capital from changes in other assets and liabilities. Servicing advances are an important component of our business and represent amounts that we, as servicer, are required to advance to, or on behalf of, our servicing clients if we do not receive such amounts from borrowers. Our use of advance financing facilities is integral to our cash and liquidity management strategy. We use mortgage loan repurchase and participation facilities (commonly called warehouse lines) to fund newly originated or purchased loans on a short-term basis until they are sold or securitized to secondary market investors, including GSEs or other third-party investors, and to fund repurchases of certain Ginnie Mae forward loans, HECM loans, second-lien loans and other types of loans. These facilities contain eligibility criteria that generally include aging and concentration limits by loan type among other provisions. Currently, our financing agreements generally have maximum terms of 364 days. The funds are typically repaid using the proceeds from the sale of the loans to the secondary market investors, usually within 30 days. We also rely on the secondary mortgage market as a source of liquidity to support our lending operations. Substantially all of the mortgage loans that we originate or purchase are sold or securitized in the secondary mortgage market in the form of residential mortgage-backed securities guaranteed by Fannie Mae or Freddie Mac and, in the case of mortgage-backed securities guaranteed by Ginnie Mae, are mortgage loans insured or guaranteed by the FHA, VA or USDA. We issued private placement securitizations to finance reverse mortgage buyouts, expanding our access to capital markets and reducing our reliance on warehouse financing facilities. We regularly evaluate financing structure options including asset-backed financing to support our investment plans and accommodate our business needs. We strive to diversify our sources of funds, optimize maturities and reduce our funding cost. We continuously evaluate the allocation of our capital to MSR and other investments, the related returns, funding and liquidity requirements. Capital Adequacy and Leverage Our licensed entities are subject to capital requirements by different agencies and regulators, including but not limited to the GSEs, Ginnie Mae and HUD. We believe our licensed entities are adequately capitalized at June 30, 2026 as reflected by the most restrictive regulatory requirements disclosed in Note 20 – Regulatory Requirements. Our stockholders’ equity ($610 million at June 30, 2026) relative to total assets denotes a high leverage ratio. Our regulators assess our leverage ratio by deducting from total assets the amount of securitized reverse mortgage loans (HECM loans) pledged to HMBS due to the “lack of true sale accounting treatment of the HMBS Program” as per the Ginnie Mae guide. As of June 30, 2026, as illustrated below, out of $12.4 billion total assets, $3.6 billion securitized HECM loans remain reported on our balance sheet with the associated HMBS liability as they do not meet sale accounting treatment under GAAP. 92 Condensed Balance Sheet June 30, 2026 December 31, 2025 HECM loans held for investment pooled into HMBS, at fair value $ 3,641 $ — HECM loans held for sale pooled into HMBS, at fair value — 9,808 All other assets 8,710 6,363 Total assets $ 12,350 $ 16,171 Home Equity Conversion Mortgage-Backed Securities (HMBS) related borrowings, at fair value $ 3,611 $ 9,612 All other liabilities 8,080 5,881 Total liabilities 11,691 15,493 Mezzanine equity (1) 50 50 Total stockholders’ equity $ 610 $ 628 (1)The Series B Preferred Stock is classified as mezzanine equity as it is contingently redeemable in the event of a change of control. On and after September 15, 2028, Onity will have the right to redeem the Series B Preferred Stock, in whole or in part, for cash at a redemption price equal to the liquidation preference plus an amount equal to any accumulated and unpaid dividends thereon. We conduct our Servicing and Originations businesses with asset-backed financing at market-standard effective advance rates, resulting in a relatively low amount of capital to finance our operations, consistent with these asset classes in the industry. Originations/pipeline mortgage loans held for sale are financed by our warehouse financing lines with an advance rate generally exceeding 95%, eligible servicing advances are financed by our match-funded advance financing facilities with an advance rate of approximately 90%, and reverse buyouts (loans held for sale, receivables and REO) are financed by OLIT securitization notes with an initial effective advance rate exceeding 90% of market value. Accordingly, we assess our capital needs, structure and leverage predominantly with respect to our capital investments, mainly our owned MSR. We prudently manage amount, risks and returns of our owned MSR within the limits of our available capital, as summarized below: Capital Investment Allocation and Structure At June 30, 2026 Assets Collateralized Financing / Liabilities (1) Net MSR, at fair value (1) $ 3,209 $ 2,259 $ 950 HECM loans held for investment pooled into HMBS, at fair value (1)(2) 3,641 3,615 26 Other assets pledged to collateralized financing facilities (1)(3) 4,403 4,274 129 Other (1)(4) 1,098 850 248 Total $ 12,350 $ 10,998 $ 1,353 Equity and debt capital structure: Corporate debt - Senior Notes Due 2029 $ 693 Mezzanine equity 50 Stockholders’ common equity 610 Total capital $ 1,353 (1)See Note 12 – Borrowings, Collateral table. (2)Includes $13 million unsecuritized HECM loans and tails, $4 million associated warehouse mortgage loan financing ($9 million net), and $16 million of HECM net asset value or economic reverse MSR. Refer to Note 5 - Reverse Mortgages for additional information regarding the closing of the sale of reverse MSRs to FAR on June 30, 2026. (3)Other assets include Advances, net, Loans held for sale, at fair value, Ginnie Mae claim receivables, net, REO and Debt service accounts (a component of Restricted cash). (4)Assets that are not subject/pledged to collateralized financing facilities and liabilities that are not financing facilities. Assets include Cash and cash equivalents, Other restricted cash, Contingent loan repurchase asset, Other assets excluding REO, Premises and equipment, and Receivables, net excluding Ginnie Mae claims. Liabilities include Other liabilities and Contingent loan repurchase liability. 93 Covenants Our debt agreements contain various qualitative and quantitative covenants including financial covenants, covenants to operate in material compliance with applicable laws and regulations, monitoring and reporting obligations and restrictions on our ability to engage in various activities, including but not limited to incurring or guarantying additional debt, paying dividends or making distributions on or purchasing equity interests of Onity and its subsidiaries, repurchasing or redeeming capital stock or junior capital, repurchasing or redeeming subordinated debt prior to maturity, issuing preferred stock, selling or transferring assets or making loans or investments or other restricted payments, entering into mergers or consolidations or sales of all or substantially all of the assets of Onity and its subsidiaries, creating liens on assets to secure debt, and entering into transactions with affiliates. These covenants may limit the manner in which we conduct our business and may limit our ability to engage in favorable business activities or raise additional capital to finance future operations or satisfy future liquidity needs. In addition, breaches or events that may result in a default under our debt agreements include, among other things, nonpayment of principal or interest, noncompliance with our covenants, breach of representations, the occurrence of a material adverse change, insolvency, bankruptcy, certain material judgments and litigation and changes of control. See Note 12 – Borrowings to the Unaudited Consolidated Financial Statements for additional information regarding our covenants. The most restrictive liquidity requirement under our debt agreements is for a minimum of $65.0 million in consolidated liquidity, as defined, under certain of our warehouse and MSR financing facilities agreements. The most restrictive consolidated net worth requirement contained in our debt agreements with borrowings outstanding at June 30, 2026, is a minimum of $275.0 million and $125.0 million tangible net worth for Onity and OMC, respectively. Refer to Note 20 – Regulatory Requirements for our regulatory capital and liquidity requirements. We are also subject to minimum capital or tangible net worth and liquidity requirements under regulatory or Agency requirements, including a risk-based capital ratio requirement for Ginnie Mae issuers. OMC is required to maintain a minimum of 6% ratio of Adjusted Net Worth less Excess MSRs, as defined, to risk weighted assets. In the second quarter of 2025, in order to achieve and maintain compliance with the Ginnie Mae RBCR requirements, we transferred certain GSE MSR investment activities previously conducted by OMC to PAS, a wholly owned subsidiary of PHH Corporation, with OMC retaining the subservicing. In addition, our debt agreements generally include cross default provisions such that a default under one agreement could trigger defaults under other agreements. If we fail to comply with our debt agreements and are unable to avoid, remedy or secure a waiver of any resulting default, we may be subject to adverse action by our lenders, including termination of further funding, acceleration of outstanding obligations, enforcement of liens against the assets securing or otherwise supporting our obligations, and other legal remedies, any of which could have a material adverse effect on our business, financial condition, liquidity and results of operations. We believe that we are in compliance with the covenants in our debt agreements and associated regulatory requirements as of June 30, 2026. Credit Ratings Credit ratings are intended to be an indicator of the creditworthiness of a company’s debt obligations. Lower ratings generally result in higher borrowing costs and reduced access to capital markets. The following table summarizes our current ratings and outlook by the respective nationally recognized rating agencies. A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time. Rating Agency Rated Entity Long-term Corporate Rating Review Status / Outlook Date of last action Fitch Onity B- Stable April 13, 2026 Moody’s Onity B3 Stable October 2, 2025 S&P Onity B- Stable October 21, 2024 On April 13, 2026, Fitch assigned a B- rating to the PHH Corporation Senior Notes Due 2029. Fitch also assigned the B- rating of Onity with a Stable Outlook. The Stable Outlook reflects Fitch’s expectations that Onity will maintain leverage and profitability metrics consistent with the current rating category, supported by a solid U.S. mortgage servicing franchise, improving earnings, adequate liquidity, and experienced management. The Stable Outlook also incorporates Fitch’s view that Onity will continue to benefit from stable servicing and subservicing cash flows, disciplined balance sheet management, and ongoing growth and diversification of its servicing portfolio. On October 2, 2025, Moody’s affirmed the Caa1 rating of the PHH Corporation Senior Notes Due 2029. Moody’s also affirmed the B3 corporate family rating of Onity. The entities’ outlooks are stable. Moody’s recognizes the progress the company has made towards achieving a sustainable level of profitability by managing its operating expenses and maintaining the size of its servicing portfolio despite difficult conditions for residential mortgage companies. The company has also continued to grow its subservicing portfolio, which is a capital-light fee-earning business. The corporate family rating also 94 reflects the company’s sound liquidity and funding profile. At the same time, Moody’s noted a credit challenge is Onity's modest capitalization, especially as the company continues to grow its portfolio and evolve its business. On January 26, 2026, Moody’s reaffirmed the Caa1 rating for the PHH Corporation Senior Notes Due 2029. On October 21, 2024, S&P assigned a B- rating to the PHH Corporation Senior Notes Due 2029. S&P also affirmed the B- rating to Onity with a Stable Outlook. The Stable Outlook reflects S&P’s expectations that Onity will maintain certain levels of debt ratio and debt-interest coverage while continuing to grow and diversify its servicing portfolio. It is possible that additional actions by credit rating agencies could have a material adverse impact on our liquidity and funding position, including materially changing the terms on which we may be able to borrow money. CRITICAL ACCOUNTING POLICIES AND ESTIMATES Our ability to measure and report our financial position and operating results is influenced by the need to estimate the impact or outcome of future events based on information available at the date of the financial statements. An accounting estimate is considered critical if it requires that management make assumptions about matters that were highly uncertain at the time the accounting estimate was made. In developing estimates and assumptions, management uses all available information; however, actual results could materially differ from those estimates and assumptions. If actual results differ from our judgments and assumptions, then it may have an adverse impact on the results of operations and cash flows. We have processes in place to monitor these judgments and assumptions, and management is required to review critical accounting policies and estimates with the Audit Committee of the Board of Directors. Our accounting policies and estimates involving significant judgments primarily relate to fair value measurements, income taxes, allowance for losses, and the provision for losses that may arise from contingencies, including indemnification obligations and litigation proceedings. We use fair value measurements to record fair value adjustments to certain instruments in our statement of operations and to determine fair value disclosures, including but not limited to MSRs, MSR related financing liabilities, Loans held for sale, Reverse loans held for sale or held for investment pooled into HMBS, and HMBS-related borrowings. As of June 30, 2026, 85% of our assets and 37% of our liabilities were reported at fair value, with fair value changes reported in our statement of operations. Substantially all our assets and liabilities at fair value were classified as Level 3 instruments due to unobservable inputs. See Note 3 – Fair Value for the carrying amounts and the estimated fair values of our financial instruments and certain of our nonfinancial assets measured at fair value on a recurring and nonrecurring basis or disclosed, but not measured, using fair value. Our significant accounting policies and critical accounting estimates are disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025 in Note 1 to the Consolidated Financial Statements and in Management’s Discussion and Analysis of Financial Condition and Results of Operations under “Critical Accounting Policies and Estimates.” There have been no material changes to the critical accounting policies and estimates disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025, other than the following: Beginning in the first quarter of 2026, we adopted an internally managed valuation model to estimate the fair value of MSR’s. We utilize industry-standard valuation and prepayment models, calibrated to consider relevant comparable benchmarking data and our actual experience. Previously we engaged third-party valuation experts to provide an estimated fair value of our MSRs. We continue to engage third-party valuation experts to benchmark our internal fair value determination. Valuation of MSRs and MSR related Financing Liabilities, at Fair Value We originate MSRs from our originations activities and acquire MSRs through flow purchase agreements, Agency Cash Window programs or bulk purchases. We account for MSRs, pledged MSR liabilities and ESS financing liabilities at fair value (reported within MSR related financing liabilities, at fair value). As of June 30, 2026, we reported a $3.2 billion fair value of MSRs and $0.7 billion MSR related financing liabilities. We determine the fair value of MSRs, Pledged MSR liabilities and ESS financing liabilities primarily using discounted cash flow methodologies. The significant components of estimated future cash inflows for MSRs include servicing fees, late fees, float earnings and other ancillary fees. Significant cash outflows include the cost of servicing, the cost of financing servicing advances and compensating interest payments. The determination of the fair value of MSRs, Pledged MSR liabilities and ESS financing liabilities requires management judgment relating to the significant unobservable assumptions that underlie the valuation, including prepayment speed, delinquency rates, cost to service and discount rate. Our judgment is informed by the transactions we observe in the market, by our actual portfolio performance and by the advice and information we obtain from our valuation experts, amongst other factors. We benchmark the reasonableness of our determination of fair value by supplying our portfolio information to multiple third-party valuation experts who generate an independent assessment of fair value. In arriving at their estimated benchmark fair value ranges, the valuation experts utilize industry standard discounted cash flow modeling incorporating an estimate of 95 prepayments, and other usual and customary inputs which reflect their observations and assumptions related to market activity, generally the bulk market, incorporating available industry survey results and client feedback, and including risk premiums and liquidity adjustments. While interest rates are a key value driver, MSR fair value may change for other market-driven factors, including but not limited to the supply and demand of the market or the required yield or perceived value by investors of such MSRs. While the models and related assumptions used by the valuation experts are proprietary to them, we understand the methodologies and assumptions used to develop the prices based on our ongoing due diligence, which includes regular discussions with the valuation experts, and we perform additional verification and analytical procedures. We believe that our procedures provide reasonable assurance that the fair value used in our consolidated financial statements comply with the accounting guidance for fair value measurements and disclosures and reflect the assumptions that a market participant would use. The fair value is equal to the internally modeled fair value mark without adjustment except in the event we have a potential or completed sale, including transactions where we have executed letters of intent, in which case the fair value of the MSRs is recorded at the estimated sale price, or the modeled fair value is outside the range of third-party valuation(s) (benchmarking), in which case we adjust the modeled fair value to ensure it remains within the valuation range provided by at least one of the MSR valuation experts. This determination is separately made for each class of MSR. The following table provides the hypothetical sensitivity of the MSR fair value to certain significant unobservable assumptions at June 30, 2026: Adverse change in MSR fair value due to significant unobservable assumption change 10% 20% Change in fair value due to change in weighted average discount rate $ (118.5) $ (227.7) Change in fair value due to change in weighted average prepayment speeds $ (85.4) $ (165.1) Change in fair value due to change in weighted average delinquency $ (20.8) $ (40.5) Change in fair value due to change in weighted average cost to service $ (38.3) $ (76.7) Changes in these assumptions are generally expected to affect our results of operations as follows: •Increases in the discount rate reduce the value of our MSRs due to the lower overall net present value of the net cash flows. •Increases in prepayment speeds generally reduce the value of our MSRs as the underlying loans prepay faster which causes accelerated MSR portfolio runoff, higher compensating interest payments and lower overall servicing fees, partially offset by a lower overall cost of servicing, increased float earnings on higher float balances and lower interest expense on lower servicing advance balances. •Increases in delinquencies generally reduce the value of our MSRs as the cost of servicing increases during the delinquency period, and the amounts of servicing advances and related interest expense also increase. •Increases in cost to service generally reduce the value of our MSRs as the expected net profitability decreases. The fair value of Pledged MSR liabilities and ESS financing liabilities is generally expected to be impacted by the same assumptions as the underlying MSR, in opposite direction. Instrument or transaction specific assumption may apply and require our judgment, including the estimated life of the subservicing agreement when MSRs are sold subservicing retained, or the yield or discount rate to apply. RECENT ACCOUNTING DEVELOPMENTS See Note 1 - Organization and Basis of Presentation to the Unaudited Consolidated Financial Statements for information related to recent accounting standards updates.