ONITY GROUP INC.

An investment in our common stock involves significant risk. We describe the most significant risks that management believes affect or could affect us under Part I, Item 1.A. of our Annual Report on Form 10-K for the year ended December 31, 2024. Understanding these risks is important to understanding any statement in such reports and in our subsequent SEC filings (including this Form 10-Q) and to evaluating an investment in our common stock. You should carefully read and consider the risks and uncertainties described therein together with all the other information included or incorporated by reference in such Annual Report and in our subsequent SEC filings before you make any decision regarding an investment in our common stock. You should also consider the information set forth under “Forward-Looking Statements.” If any of the risks actually occur, our business, financial condition, liquidity and results of operations could be materially and adversely affected. If this were to happen, the value of our common stock could significantly decline, and you could lose some or all of your investment.

There have been no material changes to the risks described in our Annual Report on Form 10-K for the year ended December 31, 2024, other than the following which updates the risk factor titled “A significant reduction in, or the total loss of, our remaining Rithm-related servicing would significantly impact our business, liquidity, financial condition and results of operations.” in light of Rithm’s notification on October 31, 2025 of its intent to not renew its subservicing agreements with us effective January 31, 2026:

If we do not restructure our servicing operations in a timely and cost-effective manner following the non-renewal of our servicing-related agreements with Rithm, it may negatively impact our business, liquidity, financial condition and results of operations.

On October 31, 2025, we were notified by one of our largest subservicing clients, Rithm, of its intent to not renew its subservicing agreements with us effective January 31, 2026. These agreements accounted for approximately $33.0 billion total servicing and subservicing UPB as of September 30, 2025. The servicing transfer to Rithm’s own servicing platform is expected to occur in the first and second quarters of 2026, subject to the receipt of necessary consents applicable to approximately $8.5 billion of UPB. See Note 8 — Other Financing Liabilities, at Fair Value, Rithm Transactions and Note 23 – Subsequent Events for information regarding renewal of our agreements with Rithm.

The servicing transfer will result in the reduction of servicing and subservicing fees and associated pledged MSR liability expense. While we continue to evaluate the impact of the servicing transfer on future results of operations, we expect a reduction of Operating expenses after downsizing certain aspects of our servicing and support functions. We further expect the recognition of a restructuring obligation upon transfer. If we are unable to timely reduce operating expenses by appropriately downsizing certain aspects of our servicing and corporate support functions, our liquidity, financial condition and results of operations may be negatively impacted. If not properly implemented, it is also possible that our restructuring activities may disrupt our ongoing servicing business and operations, including through the diversion of management attention or employee attrition.

The non-renewal of the Rithm servicing agreements will result in the reduction of Servicing and subservicing fees and associated Pledged MSR liability expense. For the nine months ended September 30, 2025, servicing and subservicing fees from Rithm amounted to $60.2 million (excluding ancillary income) and the related Rithm Pledged MSR liability expense amounted to $27.6 million. We continuously seek to replenish and profitably grow our servicing and subservicing business with our enterprise sales force and diversify our relationships. There is no assurance that we will be able to replace the lost revenue or contribution to profitability with new or existing servicing or subservicing clients in a timely manner and at comparable margins.

In addition, the float amount associated with the advance collections and servicing fees of the servicing portfolio will be repaid to Rithm in cash based on the amount due upon transfer (refer to Note 13 – Other Liabilities, Due to Rithm). The amount due varies daily. If we are unable to adjust our liquidity management practices due to the reduction of servicing float balances associated with the Rithm agreements and take additional actions required to appropriately manage our liquidity, such as the sale of MSR on a subservicing retained basis, we may experience a strain on our liquidity and cash resources which could negatively impact our ability to meet the liquidity requirements of regulators and the covenants in our financing and other contractual agreements. In addition, we may be required to reduce or abstain from investing resources in alternative income-generating activities or sell MSR or other assets, negatively impacting our ability to grow our business and improve returns for shareholders.