Onity Restores Profit After Second-Quarter Loss

The Tip Desk · November 5, 2026 · 3 min read

Adjusted pre-tax income reached $30 million and annualized adjusted ROE 19% as servicing more than offset weaker originations.

Onity Group Inc. (ONIT), a non-bank mortgage servicer and originator, returned to profitability in the third quarter of 2026 after a second-quarter net loss, with adjusted pre-tax income of $30 million and annualized adjusted ROE of 19%, up from $14 million and 9% in the prior quarter.

Net income attributable to common stockholders was $3 million, or $0.41 a share, versus a $13 million loss, or ($1.53) a share, in the second quarter. Reported ROE was 2%. The company said the swing included an $11 million pre-tax, or $0.95 a share after-tax, unfavorable impact of market volatility on hedge costs and Agency loan sales versus the second quarter.

Chair, President and CEO Glen A. Messina said servicing profitability improved sequentially and more than offset declining Originations profitability, and that the complementary businesses returned the company to profitability and more than doubled adjusted return on equity from the prior quarter.

Servicing was the turn. Servicing GAAP pre-tax income was $7 million, versus a $13 million loss in the second quarter. Servicing adjusted pre-tax income rose more than 2.4 times to $29 million from $12 million. Originations GAAP pre-tax income was $24 million, versus $27 million, and Originations adjusted pre-tax income declined 15% to $24 million from $28 million.

Total revenue was $278.1 million, down from $282.9 million. Servicing and subservicing fees were $224.7 million, and gain on loans held for sale was $26.6 million. Total operating expenses fell to $117.9 million from $139.0 million, including compensation and benefits of $55.5 million and servicing and origination costs of $15.9 million. The company reported a record operating efficiency ratio of 51% for the quarter and 52% over the last 12 months.

Total servicing additions were $24.7 billion, down from $42 billion in the second quarter, which had included a quarterly record of over $15 billion in Originations. Ending servicing UPB was $343 billion, up 9% versus the third quarter of 2025. Subservicing additions of $53 billion as of September 30, 2026 exceeded the full-year target.

Servicing advances decreased 28% versus the third quarter of 2024 to $375 million, while owned forward servicing UPB increased 49% versus that year-ago period to $179 billion. The refinance recapture rate was 57%, up 18 percentage points versus the third quarter of 2025.

The company repurchased 457,971 shares of common stock through September 30, 2026, equal to 6% of shares outstanding, improving book value per share by $1.82. Book value per share was $74, up $12 compared with the third quarter of 2025.

Onity reaffirmed previous guidance on the adjusted ROE range, servicing UPB growth, MSR hedge effectiveness, and operating efficiency. In the second-quarter release it had maintained the 10% to 15% adjusted ROE range. Messina said the company is confident in its ability to perform through the interest rate cycle.