Mortgage servicer and originator Onity Group reported a range of earnings estimates for net income to common shareholders that were stronger than previous quarter and year-ago periods despite a negative servicing line item.
Estimated net income to common shares ranged from $107 million to $131 million, improving on $18.7 million in
A $102 million to $122 million deferred tax valuation strengthened the nonbank's preliminary results. This offset an estimated $13 million to $15 million servicing loss attributed to the 2025
Some bank earnings to date also have reflected
Onity's outlook for servicing and originations
In addition to being challenged by broader market developments such as the government shutdown and FHA changes, Onity noted in an earlier securities filing that the loss of Rithm as a subservicing customer could lead to downsizing in some operations.
However, Chairman, CEO and President Glen Messina has said the change is not anticipated to be material to 2026 earnings. Messina also said the portfolio consisted of low-margin, pre-crisis loans with high delinquencies.
The current estimate suggests the average unpaid balance of servicing Onity will record on its balance sheet for the fourth quarter of 2025 will be higher than the previous one at $323 billion. Onity recorded an average $313 billion servicing UPB during the previous fiscal period.
Onity's estimates its total origination volume around $14 billion for the fourth quarter and $43 billion for the year in 2025 as compared with $10 billion to $30 billion in respective periods during 2024. The company reported that its originations in third quarter 2025 totaled $12 billion.
Consumer direct originations are estimated to total $800 million for the fourth quarter and $1.9 billion for the year in 2025, compared with $394 and $905 million, respectively in 2024. The unpaid principal balance of consumer direct fundings in third quarter 2025 was $425 million.
New senior secured notes
Onity on Monday also announced it priced $200 million in new 9.879% senior secured notes due 2029 through a Rule 144A offering by PHH Corp. and PHH Escrow Issuer LLC. The company and two of its subsidiaries, PHH Mortgage Corp. and PHH Asset Services will guarantee the notes.
Rule 144A offerings are exempt from certain reporting requirements and are limited to entitles deemed to be qualified institutional investors.
The price to investors will be 103.25% of the principal amount of the notes to an effective yield of 8.515% per year with the offering on track to close Jan. 30 if it meets customary conditions by then.
The company reported that net proceeds from the PHH senior notes would be used for general corporate purposes, including repaying some of the mortgage servicing rights-related indebtedness the two units have. PHH Mortgage focuses on lending and servicing while its business partner focuses on asset management.
The notes are being combined with
