The company, which recently divested in the forward mortgage business and sold off its title services unit, reported a $222.5 million loss.

But its operating income missed estimates with servicing income and gain-on-sale margins coming in lower than expected.

The lender and servicer posted its highest pull-through weighted gain-on-sale margin in almost two years while recording modest production growth.

The REIT issued its second securitization of the year in June, while also purchasing or locking $50 million in newly originated loans.

The real estate investment trust declined to comment on its bid to buy Western Asset Mortgage Capital, a company that received a sweetened competing offer from Terra Property Trust last week.

Radian and MGIC grabbed a larger portion of new insurance written during the period while maintaining pricing discipline.

The turnaround was due to a $42 million positive servicing mark. Even with the operating loss, it beat estimates.

The mortgage shop's net income was $36.9 million in the second quarter, up from a net loss of $37.2 million in the first three months of the year.

A second quarter profit followed two fiscal periods in the red, but the firm had to overcome a $33 million negative mortgage-servicing rights valuation.

But its mortgage business remains a money loser, and it wasn't a great period for the acquisition target either.