Earnings

Security National Mortgage Unit Posts Third-Quarter Loss

The Tip Desk · November 12, 2026 · 5 min read

Consolidated revenues were $79.9 million in the three months ended September 30, 2026, as mortgage fee income fell 28.6% to $20.8 million.

Security National Financial (SNFCA) reported total revenues of $79,942,000 for the three months ended September 30, 2026, down 10.5% from $89,326,000 a year earlier, compared with a 6.3% year-over-year decline to $83,926,000 in the second quarter.

The Utah-based life insurer, funeral-home operator and mortgage originator said the contraction was concentrated in the mortgage franchise. Mortgage fee income fell 28.6% to $20,817,000 from $29,139,000, accelerating from a 12.5% drop to $25,797,000 in the second quarter. Mortgage segment total revenues dropped 28% to $21,238,000 from $29,684,000, after a 12% decline to $26,327,000 in the prior quarter. The mortgage unit swung to a $2,135,000 net loss from a $46,000 profit in the second quarter.

Secondary gains from investors fell 21% to $16,003,000 from $20,378,000, after a 16% decline to $16,895,000 in the prior quarter. Income from loan originations declined 23% to $6,929,000 from $8,953,000, after a 7% drop to $8,222,000 in the second quarter. The change in fair value of loans held for sale reversed to a $2,037,000 loss from a $1,046,000 gain in the prior quarter. The company said the decrease in mortgage fee income was primarily due to a $4,375,000 decrease in secondary gains from loans sold to third-party investors, reflecting lower overall loan volume and less favorable pricing, a $2,048,000 decrease in the fair value of loans held for sale, and a $2,024,000 decrease in income from loan originations, partly offset by a $125,000 increase in the fair value of loan commitments. SecurityNational Mortgage originated 4,426 loans totaling $1,506,112,000 in principal for the nine months ended September 30, 2026, versus 5,216 loans and $1,756,289,000 a year earlier. The company said the lack of mortgage-rate reductions reduced refinance originations and that higher-than-anticipated rates also weighed on purchase originations, though less sharply.

Insurance premiums and other considerations fell 4.9% to $28,426,000 from $29,881,000, matching the 4.9% decline to $28,705,000 in the second quarter. The company attributed the year-over-year drop primarily to a $1,655,000 decrease in first-year premiums from lower sales, partly offset by a $200,000 increase in renewal premiums. Insurance segment net earnings declined 17% to $6,394,000 from $7,741,000, after a 20% drop to $6,647,000 in the prior quarter.

Net investment income rose 2.9% to $20,701,000 from $20,110,000, reversing a 20.2% decline to $16,429,000 in the second quarter. The company said the increase was primarily attributable to a $1,338,000 rise in other investment income and a $767,000 rise in interest on cash and cash equivalents, partly offset by a $1,111,000 decrease in mortgage-loan interest from a smaller average balance of the mortgage portfolio held for investment.

Net funeral home and cemetery sales increased 8.6% to $7,758,000 from $7,141,000, after a 4.7% rise to $7,600,000 in the second quarter. The company said the increase was primarily due to a $322,000 rise in cemetery at-need sales, a $175,000 rise in funeral-home at-need sales, and a $120,000 rise in cemetery pre-need sales. Funeral home and cemetery segment net earnings fell 17% to $1,907,000 from $2,287,000, after a 68% increase to $2,288,000 in the prior quarter.

Gains on investments and other assets declined 27% to $1,436,000 from $1,972,000, reversing a 301% increase to $4,580,000 in the second quarter. The company said the decrease was primarily due to a $1,010,000 drop in gains on equity securities from lower fair values, partly offset by a $347,000 increase in gains on other assets.

Selling, general and administrative expenses decreased 8.7% to $42,484,000 from $46,526,000, after a 10.9% drop to $42,730,000 in the second quarter. The company said the decrease was primarily the result of a $4,267,000 drop in commissions and a $1,731,000 drop in personnel expenses, partly offset by a $2,789,000 increase in other expenses. Interest expense rose 42.2% to $1,516,000 from $1,066,000, reversing a 14.6% decline to $1,105,000 in the second quarter. The company said the increase was primarily due to a $465,000 rise in interest on mortgage warehouse lines of credit for loans held for sale. Income tax expense fell 32.6% to $2,057,000 from $3,054,000, after a 13.1% increase to $2,677,000 in the second quarter. The company said the decrease was primarily due to lower earnings before income taxes. The effective tax rate rose to 25.0% from 23.3% in the year-ago quarter.

Bonds owned by the insurance subsidiaries amounted to $360,448,000 at estimated fair value as of September 30, 2026, or 34.5% of total investments.