and many of these borrowers seeking to refinance or access their home equity and generate actionable leads for our sales team. This is driving improved connectivity with customers and increasing engagement, which in turn drives increased blocks and fundings. AI call monitoring analytics provide insights to optimize marketing, improve opportunity identification, fine tune value propositions and improve sales performance. Real-time agentic AI integration through our partnership with Glen is aimed at optimizing customer and employee workflows and providing a faster, more guided experience. Technology allows us to turn interactions, bar signals, and workflow events into intelligence that drives superior recap performance and customer experience. It's clear that our investments are delivering tangible results, and we remain excited about the future potential of our investment pipeline.

Let's turn to slide 10 to discuss subservicing.

The disruption created by industry consolidation among subservicers continues to create opportunities. We are winning new clients with strong platform performance and a compelling value proposition. First Hab's subservicing additions of $35 billion exceeded our guidance with key wins with capital partners, banks, and independent mortgage banks and we continue to have an active opportunity pipeline across all three segments. We're excited about the growth we're seeing in business purpose residential and commercial subservicing driven by our expanded product offerings. UPB is up 25% versus prior year and we were renamed the servicer on our first single family rental securitization for a top tier client in that space. We continue to invest in technology to improve transparency, increase turn times and Client Service Service Functionality. Our efforts are yielding results as evidenced by our Client Net Promoter Score of 70 in the first half of 2026, a level raggling some of the best service organizations. Let's turn to slide 11 to talk about how we've grown our servicing portfolio. Total servicing UPV ended the quarter up 10% year-over-year versus total industry servicing growth of 3% with growth in both owned MSR and subservicing. Year-over-year servicing additions, net of runoff of $76 billion was largely driven by organic growth and more than offset plan transfers to Rhythm and other client asset sale-driven de-boardings. With MSR demand keeping prices elevated, we continue to see clients monetize their older MSRs while replenishing their portfolio with new originations. There should be no question as to our ability to compete for business and grow our servicing portfolio. Our double-digit portfolio growth, despite the rhythm transfer and client MSR sales, highlights the strength of our value proposition and the power of our origination capability. Now I'll turn it over to Sean to discuss our financial results in more detail.

Thanks, Glen. Let's turn to slide 12, where we describe the impact to GAAP pre-tax income. The main story here is that the bulk of the decline in pre-tax income, about $24 million, is due to non-recurring transaction costs or fair value marks on reverse assets. Ongoing operations and servicing was the strongest contributor to the $6 million increase in GAAP pre-tax income quarter over quarter. The Finance of America transaction, and to a lesser extent, costs associated with the rhythm deporting, created a $9 million negative one-time impact in the quarter. This was further exacerbated by a decline in the fair value of the reverse assets due to mark-to-mark impacts, primarily less favorable HECM spreads. The majority of these assets, about 80% of the fair value, have been sold to Finance of America. Thus, the impact of fair value changes on the remaining portfolio will be greatly reduced. Furthermore, the assets we are retaining are older and have less sensitivity to spread movements given their shorter duration. The remaining mark-to-market impacts were due to a mild increase in delinquency as well as hedge costs. Regarding delinquencies, if you refer to the appendix page on MSR evaluation, you will see the 30-plus delinquency bucket on GSEs deteriorated. However, the Ginnie Mae delinquency buckets improved quarter over quarter. The 30-plus category is the most volatile measure, so we focus more on the longer periods, such as the 60 and 90-plus. We are closely monitoring the portfolio for any indications of longer-term stress on borrowers. The final impact is $4 million due to both hedge costs and fair value inputs, which is a small percentage of the $2.5 billion fair value MSR book that we hedge. Please turn to slide 13 for a perspective on MSR fair value impacts. This graph shows three different drivers of MSR fair value broken into runoff, rates net of hedge, and inputs and assumptions. Runoff is the actual MSR value of unpaid principal balance that either paid in full or amortized during the quarter. Then we show the impact of interest rates, net of hedge, and finally MSR fair value changes from inputs and assumptions. This last category includes changes in loan characteristics such as delinquency status, borrower escrow payments, assumptions for prepayments, loan defaults, servicing costs, ancillary income, discount rate, and changes in bulk market MSR prices, all of which impact modeled cash flows and MSR fair value. Runoff is always detrimental to net income and can increase due to several variables, including higher prepayment speeds due to lower interest rates. You can see this impact from Q4 25 through the current quarter when we had several refinance surges due to a temporary but meaningful drop in mortgage rates. Another driver of runoff is portfolio size, which has been increasing. With respect to the other categories, both interest rates, net of hedge, as well as input and assumptions become smaller drivers when considered across multiple quarters in a cumulative fashion. The average of either of these categories shows a volatility of about plus or minus three basis points. That's why we show these impacts in notables, which impacts net income but do not include them in adjusted pre-tax income, given the periodic volatility or swings. We believe this is similar to several large competitors in our space. Please turn to slide 14 for a similar view of reverse. Here you can see that the reverse book experiences far more volatility than the forward book. The impact from interest rates and inputs and assumptions are both materially greater as a percentage of the total balances in reverse compared to forward on the prior page. This shows how our recent sale of the majority of this book should lessen MSR fair value volatility going forward. Please turn to slide 15 for a recap of key financial measures. Revenue is up 24%, continuing the strong year-over-year growth trend. Both servicing and originations contributed to the year-over-year growth in revenue due to higher volumes and stronger execution, which included improved recapture, reduced servicing advances, and better data analytics. Sequential revenue growth was up slightly as servicing increased more than the origination decline. This is primarily due to growth in the owned MSR volume driving revenues. Operating efficiency continued to improve on a 12-month trailing basis, which reflects our long-term focus on cost-effective growth, and book value per share is up significantly, about $13 year over year. Please turn to slide 16 for detail on originations. Originations pre-tax income grew by over three times on a year-over-year basis, driven by higher volume across the combined business. The $15.5 billion of funded volume in the second quarter was our largest quarter in history. The strongest contributor was the B2B channel. This is correspondent lending and co-issue. The volume improvement did not come at the expense of margins, as those also improved due to our strong enterprise sales efforts. and continued improvements on analytics to drive margin management. Consumer direct remained profitable but generated lower adjusted pre-tax income from two drivers. The first is lower lock volume in the second quarter by 30% quarter over quarter. Lock volume is a key metric for recognizing revenue. The second is elevated consumer direct operating expense due to lagging commissions from the first quarter refinance surge. With respect to staffing, our objective is to balance efficiency with flexibility. We optimize our capacity levels to balance current earnings growth and accommodate any future interest rate decline. Hence, our origination staffing is at levels to support higher than current volumes. Both B2B and consumer direct channels benefited from a continued focus on growing new products, including non-QM and second liens. Second liens have more than doubled in volume year over year with over $70 million funding in the second quarter. Please turn to slide 17 for our servicing performance. Starting with the middle graph, strong owned MSR growth helped drive servicing revenues up 13% from the prior year and 3% sequential quarter. Servicing adjusted pre-tax income improved on a sequential quarter due to better float income and better runoff as mortgage rates stayed elevated in the second quarter. Year over year, adjusted pre-tax income is still lower, driven primarily by higher runoff, which you can see at the bottom of the right graph, which is then partially offset by improved revenues. Please turn to slide 18 for details on improved advances in servicing. Building on the strong improvements we saw last quarter, servicing continues to improve the advanced balances with a 33% decline over the last two years. This comes even as we grow our own servicing UPV as we focus on the small percentage of loans that drive the most advances. As you can see by the dark blue graph, the bulk of our advances are linked to delinquencies in our non-agency-owned MSR book. We have been deploying various strategies such as AI-enabled agents that assist our contact center in quickly providing the most effective range of solutions for the borrower. As we scale AI-powered solutions for our contact center, we are targeting an annual savings of about $3 million at our current portfolio size. Slide 19 gives our approach to capital allocation. Our considerations for capital deployment focus on organic growth, liquidity, and returning capital to investors. Organic growth includes adding owned MSR via profitable originations activity. Other examples include broadening our product offering for both originations and servicing. In parallel, we maintain sufficient liquidity to ensure we meet both regulatory and lender requirements, as well as holding enough buffer for various stress scenarios. We also consider ways to return capital to investors. Our 10Q provides information on the recently completed $10 million share buyback, as well as the ongoing $20 million buyback, which reflect the value we see in acquiring shares that are priced materially lower than book value. On slide 20, we provide our updated view on 2026 guidance. As Glen mentioned earlier, we are guiding to the lower end of the adjusted pre-tax income range of 10% to 15% based on current market conditions and the first half results. The other areas we provide guidance on are unchanged. We continue to grow our total servicing book with strong growth this most recent quarter, improve our operating efficiency, and maintain strong hedging performance. Back to you, Glen.

Thanks, Sean. Let's turn to slide 21 for a few comments before we open the call for questions. Onity is a top 10 non-bank mortgage originator, servicer, and subservicer with a balanced and resilient business that is winning and growing in our target markets. Our second quarter results demonstrate that our growth strategy is sound and our operating fundamentals are strong. We've built a technology-enabled, award-winning platform that is efficient, delivers differentiated performance and excellent service. We are taking focused and decisive actions to improve ROE over the long term, organized into three categories, increasing servicing scale, portfolio optimization, and technology-driven productivity. To that end, we believe the reverse asset sale to Finance of America and the legacy subservicing transfer simplify the business, improve profitability and focus, and increase strategic flexibility. For the strong foundation, simplified business, and greater flexibility, we believe we are well positioned to navigate the current environment, capitalize on attractive opportunities, and continue delivering sustainable, prudent growth. All this adds up to a business that delivers adjusted ROE comparable to our peers with increasing scale and market position at a more attractive valuation. With that, operator, let's open the call for questions.

Thank you. And if you would like to ask a question, please press star 1 on your telephone keypad. To leave the queue at any time, press star 2. Once again, that is star and 1 to ask a question. We will take our first question from Bose George with KBW. Please go ahead. Your line is open.

Hey, guys. Good morning. This is Frankie Labete on for Bose. I just want to start. You guys nicely laid out the goals for your pre-tax adjusted ROE range. Can you just help quantify what bridges the gap to the lower end of the range given you're in this 9% range currently and the market is pretty volatile? So, yeah.

Good morning.

So, look, we, based on the ROE expansion actions that we laid out in the presentation, you know, on page five, in terms of driving improving servicing scale, you know, optimizing the servicing portfolio, and then obviously continue to drive, you know, productivity. Look, we believe that Those are going to help us improve the ROE of the business, despite some of the volatility that exists in the marketplace. Where we really saw some of that volatility hit us in the past is the loan origination pipeline hedging. We saw a lot of noise in that during the first quarter of this year, and that's in the second quarter that seemed to behave a lot better. We saw improved margins in the origination space, even though there continues to be market volatility and we'd have record origination volumes as well, too. So, look, we feel good about the actions we're taking to drive improved adjusted pre-tax ROE. And we feel a little bit better about our ability to manage some of the volatility that we've experienced in the first half of the year. So, yeah, those are the actions that we think get us into the ROE range. Sean, anything you want to add?

Yeah. Hey, Frankie. I'd add that some of the pressure we've seen on adjusted pre-tax income over the last three quarters has been very high runoff. If rates do stay elevated, you know, that theoretically should improve over time. That improves servicing's adjusted pre-tax income, and we continue to show an ability to generate pre-tax income in originations, even a rather difficult quarter like the one that just happened.

Great. Thank you. That's very helpful. And then just a little more broadly, you know, banks had a pretty meaningful increase in volumes and taking share during the quarter. How do you see them evolving in the market? And then secondly, in the correspondent channel, Can you just talk about competition you're seeing there, especially at the GSC cash window? Thanks.

Sure. So Frankie, look, banks have always been a force to be reckoned with. When they want to play in this space, they typically come in and buy and buy aggressively. And quite frankly, we're seeing a number of bank buyers of MSRs in the marketplace during the first half of this year. who have a seemingly insatiable desire for MSR assets. Net-net, we think that's good for valuations, but obviously creates an interesting competitive dynamic. If the bank capital regulations, proposed relaxing of bank capital regulations for holding MSRs change, look, I think there's a number of financial institutions which I should say banks who have strong mortgage franchises today. They'll continue to grow them. Based on our conversations with experts around the banking industry, doesn't seem to be a whole lot of folks who would be considering a wholesale change in their strategy of, I'm not a mortgage today, I'm going to go gangbusters. That's not the predominant thinking. Those who are in will likely get bigger and increase their franchise. That said, it makes businesses like ours more valuable in the sense that if somebody is thinking about getting into the mortgage space, it's hard to start de novo. If you want to get in, you get in with scale. And you look at a business like ours that has billions of dollars of custodial and escrow deposits, which are considered to be sticky deposits, that's an interesting I think maybe how banks think about looking at non-bank mortgage companies. In terms of competition in the correspondence space, look, I think our correspondent team is just doing a phenomenal job. They are focused on value-based selling using an enterprise sales strategy. and, you know, Locke, our ability to achieve record origination volumes where, you know, frankly, industry origination volumes, you know, with rates up are, you know, are not looking as encouraging as they were in the first quarter. You know, the team's just doing a phenomenal job. And again, we, you know, I think as Sean talked about, you know, margins increase, you know, from 23 to 26 basis points as well. Look, Correspondent has always been competitive and is the most competitive, well, maybe compared to Broker, but it might be second most competitive space in the industry. But I think our team is just doing a terrific job there. Really proud of them. And again, that's part of why we were able to achieve record origination volumes.

Thank you.

Thank you. Our next question comes from Randy Banner with Texas Capital. Please go ahead.

Hey, good morning. Thanks. This is all very helpful. And so I'd like to, if I can, just ask about the ROE again and maybe play some of that back because it was lower in the first quarter. I just want to make sure my model is kind of reflecting getting to that 10%. kind of isolating it to three things. I'd love to kind of hear your thoughts or feedback on this. So one, you're going to have an ongoing buyback, so that helps the denominator. If you can comment on kind of your plan to execute on that, that'd be helpful. The second thing is your other revenue line has been better, at least versus our expectation, and understanding what that is and the sustainability of that other revenue line is just marginally helpful. and then the third thing and most importantly is that and you've said this kind of quite clearly the MSR mark should be more stable I think because of everything you've laid out you know your your program plus you know your your program is augmented more broadly and reverse going away will make it more stable but How do we keep track of that? Do we look at the move index on Bloomberg, or how do we judge that lower kind of vol in MSR as we get through the third quarter and even the fourth quarter? Sorry, that was a lot there, but just trying to build the building blocks with the low end of the ROE. Thanks.

Yeah, good morning, Randy. A couple of things here. So let me start with the share buyback program. You know, we completed the $10 million authorization from the board. You know, the board then reauthorized another $20 million in share repurchases. You know, when our queue comes out later today, you'll see in our queue the amount of shares we've bought back and, you know, the dollar volumes and average share price. And we're continuing to, you know, it's a 10B51 program. It continues to execute, and that's going to run its course. So, you know, we're going to continue to do that. the share buybacks should continue generally at the rate that we saw in the second quarter. And again, that'll be disclosed in our queue. As it relates to MSR volatility, I'd say the volatility in our MSR, forward MSR, so let's separate forward from reverse. Volatility in the forward MSR certainly has been, as Sean pointed out in his charts, within the range of what I call the reasonable expectation for volatility. So net-net, when you look at the forward MSR change due to rates, inputs, and assumptions, it was about a $4 million net change. and many others. So, you know, it's a very, very, very, very, very, very, very, very, very, very, We did see an improvement in the GMA delinquencies, as we would have expected. We saw an uptick in GSE delinquencies, Sean. It looks like those are beginning to abate, and we're seeing those return to normal, so we feel pretty good about the consumer. We're not seeing anything that would suggest in the next six months there's going to be a radical shift in consumer behavior. Payment behavior is going to be seasonality. That always happens, right? So I think the forward MSR volatility is much, I think, is well controlled and it's within the range. Our capital markets team is doing a terrific job managing that asset. You know, on the reverse side, I've got to tell you, we saw an extreme amount of volatility in that asset between the first and second quarter. You know, to give you an order of magnitude here, in the second quarter, you know, net, you know, unfavorable fair value adjustments to rates, inputs, and assumptions of about $12 million on the reverse MSR. And that's on a UPB of about $10 billion, sorry, $12 million on $10 billion, which when you think about it in a relative scale as compared to the forward side, just the volatility is off the charts. And that, you know, and in the first quarter was a $4 million good guy, right? Or a $3 million good guy. And that's how you get to the $15 million swing that Sean showed on his chart. So by virtue of decreasing, we're selling about 80% of our MSRs to Finance of America, who is much better equipped as a solely reverse mortgage-focused company to deal with that volatility and address it. I think on a go-forward basis, we would expect to see much less volatility. in the reverse MSR. Randy, I may have missed your second point.

Yeah, that was super helpful. And that love, the detail is helpful just to have confidence and kind of modeling a lower ball around the MSRs. The other question, the third question I had, and these are just, again, this is just me looking at the numbers and trying to identify the three kind of moving pieces. But incrementally, at least for me, the other revenue line has been performed well year to date. And so the question is, what's in that other revenue line? Like, what is it? And then, you know, is it sustainable to kind of deliver 20 mil of REV? You know, because it's consistently had that number 19.1 and 20.4 in the first and second quarter, respectively. So is that sustainable? And what is it?

Sean, I'll turn it over to you. Maybe just to tee it up for you. You know, there's probably escrow earnings and things like that are falling into that other revenue line, but I'll turn it over to you.

Yeah. Hey, Randy, how's it going? Yeah, that is driven somewhat by ancillary income that we get off of higher owned MSRs. And so as you see the growth in our own MSRs, you're going to see that both on the top line where you see servicing and subservicing fees, and then as well as some data and other revenue net. and so, yeah, we think that is sustainable and continue to look for that as well as gain on sales to continue to drive growth.

All right, great. And then if I can just do one follow-up on a comment that Glen made that I had observed in the market as well, so I love your insight, but you mentioned some of the GSE delinquencies had bumped up but now are improving. I just wanted to like focus on that. Is that a case? And if so, do you know what kind of caused those to go higher and then improve?

Yeah, so we did see a bump up in particularly the 30-day bucket in GSE delinquencies. And you'll see that if you look in our earnings supplement, there's the MSR evaluation page. And you'll see that the delinquencies in GSE spiked up and largely sitting in the 30-day bucket. You know, look, based on some of our work looking historically over the past couple of years, there's this unusual seasonal spike in delinquencies right around the 4th of July holiday. And I don't know what it is and what the consumer psyche is around it, but we do tend to see delinquencies, 30-day delinquencies, rise just in the month of June before the 4th of July holiday and then fall after the 4th of July holiday. So, Sean, any more questions? Insights you want to put into that?

Our servicing leaders speculate that that's because people actually end up missing, you know, depending where the holiday falls, then they make two payments in the month of July. And you'll see seasonally a lot of times the 30 plus recovers in the following month. So we see details on July. We can't go too much into that. But, you know, I'd add that changes in 30 plus are, you know, kind of could be seasonal, could be driven by many things. We tend to look at the 60 and the 90-plus metrics for longer-term impact. Of course. You know, monitor that going forward, of course.

I guess people are just too busy going to the beach and living their lives to pay that check, that bill. But they catch up, so I guess that's good. Okay, thanks. Appreciate the answers.

Thank you. and once again, if you would like to ask a question, please press star one on your telephone keypad.

We will pause for a moment to allow any further questions to queue.

And at this time, there are no further questions in queue. I will now turn the meeting back to Glen Messina for closing comments.

Thanks, Nikki. and certainly thanks to all our shareholders and our key business partners for your support of the Onity business. I also want to thank and recognize the board of directors and the global business team for all their hard work and commitment to our success. And I look forward to updating you on our progress in our next earnings call. Thank you so much.

Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.