10-Q - PFSI - Equibles

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

Form 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-38727

PennyMac Financial Services, Inc.

(Exact name of registrant as specified in its charter)


Delaware		83-1098934
(State or other jurisdiction of		(IRS Employer
incorporation or organization)		Identification No.)


3043 Townsgate Road , Westlake Village , California		91361
(Address of principal executive offices)		(Zip Code)

( 818 ) 224-7442

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.0001 par value		PFSI		New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ☒		Accelerated filer ☐

Non-accelerated filer ☐		Smaller reporting company ☐

		Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.


Class		Outstanding at July 25, 2025
Common Stock, $0.0001 par value		51,710,032

Table of Contents

PENNYMAC FINANCIAL SERVICES, INC.

FORM 10-Q

June 30, 2025

TABLE OF CONTENTS


		Page
	Special Note Regarding Forward-Looking Statements	3

PART I. FINANCIAL INFORMATION		6

Item 1.	Financial Statements (Unaudited):	6
	Consolidated Balance Sheets	6
	Consolidated Statements of Income	7
	Consolidated Statements of Changes in Stockholders’ Equity	8
	Consolidated Statements of Cash Flows	9
	Notes to Consolidated Financial Statements	11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	60
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	79
Item 4.	Controls and Procedures	81

PART II. OTHER INFORMATION		82

Item 1.	Legal Proceedings	82
Item 1A.	Risk Factors	82
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	82
Item 3.	Defaults Upon Senior Securities	82
Item 4.	Mine Safety Disclosures	82
Item 5.	Other Information	82
Item 6.	Exhibits	84

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (“Report”) contains certain forward-looking statements that are subject to various risks and uncertainties. Forward-looking statements are generally identifiable by use of forward-looking terminology such as “may,” “will,” “should,” “potential,” “intend,” “expect,” “seek,” “anticipate,” “estimate,” “approximately,” “believe,” “could,” “project,” “predict,” “continue,” “plan” or other similar words or expressions.

Forward-looking statements are based on certain assumptions, discuss future expectations, plans and strategies, contain financial and operating projections or state other forward-looking information. Examples of forward-looking statements include, but are not limited to, the following:

●	projections of our revenues, income, earnings per share, capital structure or other financial items;
●	descriptions of our plans or objectives for future operations, products or services;
---	---
●	forecasts of our future economic performance, interest rates, profit margins and prepayment rates;
---	---
●	discussions of our expectations regarding various macroeconomic factors, including variability in the economy or the impact of current and future regulations and legislation on our business; and
---	---
●	descriptions of assumptions underlying or relating to any of the foregoing expectations regarding the timing of generating any revenues.
---	---

Our ability to predict results or the actual effect of future events, actions, plans or strategies is inherently uncertain. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results and performance could differ materially from those set forth in the forward-looking statements. There are several factors, many of which are beyond our control that could cause actual results to differ significantly from management’s expectations. Some of these factors are discussed below.

You should not place undue reliance on any forward-looking statement and should consider the following uncertainties and risks, as well as the risks and uncertainties discussed elsewhere in this Quarterly Report on Form 10-Q (this “Report”), the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission (“SEC”) on February 19, 2025 and in our other SEC filings.

Factors that could cause actual results to differ materially from historical results or those anticipated include, but are not limited to:

●	interest rate changes;

●	changes in real estate values, housing prices and housing sales;
●	changes in macroeconomic, consumer and real estate market conditions;
---	---
●	the continually changing federal, state and local laws and regulations applicable to the highly regulated industry in which we operate;
---	---
●	lawsuits or governmental actions that may result from any noncompliance with the laws and regulations applicable to our business;
---	---
●	the mortgage lending and servicing-related regulations promulgated by the Consumer Financial Protection Bureau and its enforcement of these regulations;
---	---

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●	the licensing and operational requirements of states and other jurisdictions applicable to our business, to which our bank competitors are not subject;
●	changes to government modification programs;
---	---
●	foreclosure delays and changes in foreclosure practices;
---	---
●	difficulties inherent in adjusting the size of our operations to reflect changes in business levels;
---	---
●	purchase opportunities for mortgage servicing rights;
---	---
●	our substantial amount of indebtedness;
---	---
●	increases in loan delinquencies, defaults and forbearances;
---	---
●	our dependence on U.S. government-sponsored entities and changes in their current roles or their guarantees or guidelines;
---	---
●	our ability to manage third party vendors and mortgage investor requirements;
---	---
●	our exposure to counterparties that do not fulfill contractual obligations, including their obligation to indemnify us or repurchase defective mortgage loans;
---	---
●	our reliance on PennyMac Mortgage Investment Trust (NYSE: PMT) as a significant contributor to our mortgage banking business;
---	---
●	maintaining sufficient capital and liquidity and compliance with financial covenants;
---	---
●	our obligation to indemnify third-party purchasers or repurchase loans if loans that we originate, acquire, service or assist in the fulfillment of fail to meet certain criteria;
---	---
●	our obligation to indemnify PMT if our services fail to meet certain criteria or characteristics or under other circumstances;
---	---
●	changes in investment management and incentive fees;
---	---
●	conflicts of interest in allocating our services and investment opportunities among us and our advised entity;
---	---
●	our ability to mitigate cybersecurity risks, cyber incidents and technology disruptions;
---	---
●	the effect of public opinion on our reputation;
---	---
●	our exposure to risks of loss and disruptions in operations resulting from severe weather events, man-made or other natural conditions, including climate change and pandemics;
---	---

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●	our ability to effectively identify, manage and hedge our credit, interest rate, prepayment, liquidity and climate risks;
●	our initiation or expansion of new business activities or strategies;
---	---
●	our ability to detect misconduct and fraud;
---	---
●	our ability to pay dividends to our stockholders; and
---	---
●	our organizational structure and certain requirements in our charter documents.
---	---

Other factors that could also cause results to differ from our expectations may not be described in this Report or any other document. Each of these factors could by itself, or together with one or more other factors, adversely affect our business, results of operations and/or financial condition.

Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update any forward-looking statement to reflect the impact of circumstances or events that arise after the date the forward-looking statement was made.

Table of Contents PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

PENNYMAC FINANCIAL SERVICES, INC.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)


	****	June 30,			December 31,
	****	2025		****	2024
		(in thousands, except share amounts)
ASSETS
Cash		$	162,186		$	238,482
Short-term investment at fair value			462,262			420,553
Principal-only stripped mortgage-backed securities at fair value pledged to creditors			784,958			825,865
Loans held for sale at fair value (includes $6,873,346 and $8,140,834 pledged to creditors)			6,961,224			8,217,468
Derivative assets			180,642			113,076
Servicing advances, net (includes valuation allowance of $82,025 and $85,788; $265,118 and $357,939 pledged to creditors)			430,602			568,512
Mortgage servicing rights at fair value (includes $9,350,647 and $8,609,388 pledged to creditors)			9,531,249			8,744,528
Investment in PennyMac Mortgage Investment Trust at fair value			965			944
Receivable from PennyMac Mortgage Investment Trust			30,604			30,206
Loans eligible for repurchase			4,962,535			6,157,172
Other (includes $13,124 and $16,697 pledged to creditors)			714,677			770,081
Total assets		$	24,221,904		$	26,086,887
LIABILITIES
Assets sold under agreements to repurchase		$	7,344,254		$	8,685,207
Mortgage loan participation purchase and sale agreements			700,296			496,512
Notes payable secured by mortgage servicing assets			1,327,143			2,048,972
Unsecured senior notes			4,185,012			3,164,032
Derivative liabilities to non-affiliates			32,503			40,900
Derivative liability to PMT			1,038			—
Mortgage servicing liabilities at fair value			1,643			1,683
Accounts payable and accrued expenses			394,785			354,414
Payable to PennyMac Mortgage Investment Trust			86,174			122,317
Payable to exchanged Private National Mortgage Acceptance Company, LLC unitholders under tax receivable agreement			24,806			25,898
Income taxes payable			1,097,452			1,131,000
Liability for loans eligible for repurchase			4,962,535			6,157,172
Liability for losses under representations and warranties			31,763			29,129
Total liabilities			20,189,404			22,257,236

Commitments and contingencies – Note 18

STOCKHOLDERS’ EQUITY
Common stock—authorized 200,000,000 shares of $0.0001 par value; issued and outstanding, 51,671,905 and 51,376,616 shares, respectively			5			5
Additional paid-in capital			76,991			56,072
Retained earnings			3,955,504			3,773,574
Total stockholders' equity			4,032,500			3,829,651
Total liabilities and stockholders' equity		$	24,221,904		$	26,086,887

The accompanying notes are an integral part of these consolidated financial statements. 6

Table of Contents PENNYMAC FINANCIAL SERVICES, INC.

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)


	Quarter ended June 30,				****	Six months ended June 30,
	2025		2024		****	2025		2024
	(in thousands, except earnings per share)
Revenues
Net gains on loans held for sale at fair value:
From non-affiliates	$	227,584	$	176,537		$	443,783	$	339,331
From PennyMac Mortgage Investment Trust		7,075		(473)			11,913		(826)
		234,659		176,064			455,696		338,505
Loan origination fees:
From non-affiliates		58,589		41,644			104,723		77,656
From PennyMac Mortgage Investment Trust		502		431			979		790
		59,091		42,075			105,702		78,446
Fulfillment fees from PennyMac Mortgage Investment Trust		5,814		4,427			11,104		8,443
Net loan servicing fees:
Loan servicing fees:
From non-affiliates		435,517		375,040			853,204		733,066
From PennyMac Mortgage Investment Trust		21,645		20,264			43,374		40,526
Other		49,505		45,392			98,557		91,288
		506,667		440,696			995,135		864,880
Change in fair value of mortgage servicing rights and mortgage servicing liabilities		(247,170)		(101,315)			(678,126)		(129,900)
Mortgage servicing rights hedging results		(109,102)		(171,777)			(2,328)		(466,422)
		(356,272)		(273,092)			(680,454)		(596,322)
Net loan servicing fees		150,395		167,604			314,681		268,558
Management fees from PennyMac Mortgage Investment Trust		6,869		7,133			13,881		14,321
Net interest expense:
Interest income		221,929		200,811			411,800		357,237
Interest expense		239,577		207,871			447,659		373,640
Net interest expense		(17,648)		(7,060)			(35,859)		(16,403)
Change in fair value of investment in and dividends received from <br>PennyMac Mortgage Investment Trust		(105)		(40)			80		(30)
Results of real estate acquired in settlement of loans		47		193			(178)		599
Repricing of payable to exchanged Private National Mortgage Acceptance Company, LLC unitholders under tax receivable agreement		1,092		—			1,092		—
Other		4,516		15,731			9,434		19,348
Total net revenues		444,730		406,127			875,633		711,787
Expenses
Compensation		187,541		141,956			369,529		288,332
Loan origination		68,836		40,270			112,932		70,838
Technology		42,257		35,690			82,454		71,657
Servicing		28,286		22,920			50,161		39,024
Marketing and advertising		12,389		5,445			21,821		9,116
Professional services		8,380		9,404			17,417		18,666
Occupancy and equipment		8,379		7,893			16,761		16,569
Other		12,220		8,695			23,920		19,848
Total expenses		368,288		272,273			694,995		534,050
Income before (benefit from) provision for income taxes		76,442		133,854			180,638		177,737
(Benefit from) provision for income taxes		(60,021)		35,596			(32,105)		40,171
Net income	$	136,463	$	98,258		$	212,743	$	137,566
Earnings per share
Basic	$	2.64	$	1.93		$	4.12	$	2.71
Diluted	$	2.54	$	1.85		$	3.97	$	2.59
Weighted average shares outstanding
Basic		51,667		50,955			51,587		50,751
Diluted		53,635		53,204			53,626		53,140

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents PENNYMAC FINANCIAL SERVICES, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED)


		Quarter ended June 30, 2025
							Additional						Total
		Number of		Par			paid-in			Retained			stockholders'
	****	shares	****	value		****	capital		****	earnings		****	equity
		(in thousands)
Balance, March 31, 2025		51,659		$	5		$	68,902		$	3,834,849		$	3,903,756
Net income		—			—			—			136,463			136,463
Stock-based compensation		12			—			8,031			—			8,031
Issuance of common stock in settlement of directors' fees		1			—			58			—			58
Common stock dividend ($0.30 per share)		—			—			—			(15,808)			(15,808)
Balance, June 30, 2025		51,672		$	5		$	76,991		$	3,955,504		$	4,032,500


		Quarter ended June 30, 2024
							Additional						Total
		Number of		Par			paid-in			Retained			stockholders'
	****	shares	****	value		****	capital		****	earnings		****	equity
		(in thousands)
Balance, March 31, 2024		50,908		$	5		$	27,179		$	3,543,199		$	3,570,383
Net income		—			—			—			98,258			98,258
Stock-based compensation		108			—			2,816			—			2,816
Issuance of common stock in settlement of directors' fees		1			—			58			—			58
Common stock dividend ($0.20 per share)		—			—			—			(10,397)			(10,397)
Balance, June 30, 2024		51,017		$	5		$	30,053		$	3,631,060		$	3,661,118


		Six months ended June 30, 2025
							Additional						Total
		Number of		Par			paid-in			Retained			stockholders'
	****	shares	****	value		****	capital		****	earnings		****	equity
		(in thousands)
Balance, December 31, 2024		51,377		$	5		$	56,072		$	3,773,574		$	3,829,651
Net income		—			—			—			212,743			212,743
Stock-based compensation		294			—			20,804			—			20,804
Issuance of common stock in settlement of directors' fees		1			—			115			—			115
Common stock dividends ($0.60 per share)		—			—			—			(30,813)			(30,813)
Balance, June 30, 2025		51,672		$	5		$	76,991		$	3,955,504		$	4,032,500


		Six months ended June 30, 2024
							Additional						Total
		Number of		Par			paid-in			Retained			stockholders'
	****	shares	****	value		****	capital		****	earnings		****	equity
		(in thousands)
Balance, December 31, 2023		50,179		$	5		$	24,287		$	3,514,311		$	3,538,603
Net income		—			—			—			137,566			137,566
Stock-based compensation		836			—			5,624			—			5,624
Issuance of common stock in settlement of directors' fees		2			—			142			—			142
Common stock dividends ($0.40 per share)		—			—			—			(20,817)			(20,817)
Balance, June 30, 2024		51,017		$	5		$	30,053		$	3,631,060		$	3,661,118

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents PENNYMAC FINANCIAL SERVICES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


		Six months ended June 30,
	****	2025		****	2024
		(in thousands)
Cash flow from operating activities
Net income		$	212,743		$	137,566
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Net gains on loans held for sale at fair value			(455,696)			(338,505)
Change in fair value of mortgage servicing rights and mortgage servicing liabilities			678,126			129,900
Mortgage servicing rights hedging results			2,328			466,422
Accrual of unearned discounts on principal-only stripped mortgage-backed securities			(18,034)			(9,090)
Capitalization of interest on loans held for sale			(1,598)			(247)
Amortization of debt issuance costs			17,277			14,798
Change in fair value of investment in common shares of <br> PennyMac Mortgage Investment Trust			(21)			90
Results of real estate acquired in settlement in loans			178			(599)
Repricing of payable to exchanged Private National Mortgage Acceptance Company, LLC unitholders under tax receivable agreement			(1,092)			—
Stock-based compensation expense			18,602			2,371
Provision for servicing advance losses			11,970			4,391
Depreciation and amortization			28,627			28,404
Amortization of operating lease right-of-use assets			7,036			6,883
Purchase of loans held for sale from PennyMac Mortgage Investment Trust			(47,382,225)			(37,161,319)
Origination of loans held for sale			(11,725,361)			(6,972,822)
Purchase of loans held for sale from non-affiliates			(2,202,139)			(1,193,246)
Purchase of loans from Ginnie Mae securities and early buyout investors			(2,195,739)			(1,579,386)
Sale to non-affiliates and principal payment of loans held for sale			62,243,471			44,537,449
Sale of loans held for sale to PennyMac Mortgage Investment Trust			1,689,692			—
Repurchase of loans subject to representations and warranties			(45,360)			(44,863)
Decrease in servicing advances			35,809			219,799
Increase in receivable from PennyMac Mortgage Investment Trust			(3,897)			(1,541)
Sale of real estate acquired in settlement of loans			37,325			25,671
Decrease (increase) in other assets			9,541			(39,753)
Increase (decrease) in accounts payable and accrued expenses			48,838			(145,062)
Decrease in operating lease liabilities			(9,563)			(8,809)
Decrease in payable to PennyMac Mortgage Investment Trust			(32,648)			(108,839)
(Decrease) increase in income taxes payable			(33,548)			39,511
Net cash provided by (used in) operating activities			934,642			(1,990,826)

Statements continue on the next page

Table of Contents PENNYMAC FINANCIAL SERVICES, INC.

(Continued)

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


		Six months ended June 30,
	****	2025		****	2024
		(in thousands)
Cash flow from investing activities
Increase in short-term investment			(41,709)			(178,504)
Purchase of principal-only stripped mortgage-backed securities			—			(935,356)
Repayment of principal-only stripped mortgage-backed securities			84,267			13,452
Net settlement of derivative financial instruments used for hedging of mortgage servicing rights			(10,913)			(391,462)
Acquisition of capitalized software			(16,283)			(8,661)
Purchase of furniture, fixtures, equipment and leasehold improvements			(1,676)			(1,319)
Increase in margin deposits			(140,719)			(18,556)
Net cash used in investing activities			(127,033)			(1,520,406)
Cash flow from financing activities
Sale of assets under agreements to repurchase			63,703,978			48,557,391
Repurchase of assets sold under agreements to repurchase			(65,044,887)			(45,912,545)
Issuance of mortgage loan participation purchase and sale certificates			12,277,214			10,967,597
Repayment of mortgage loan participation purchase and sale certificates			(12,072,836)			(10,901,474)
Issuance of notes payable secured by mortgage servicing assets			100,000			725,000
Repayment of notes payable secured by mortgage servicing assets			(825,000)			(875,000)
Issuance of unsecured senior notes			1,700,000			650,000
Repayment of unsecured senior notes			(650,000)			—
Payment of debt issuance costs			(43,763)			(25,208)
Issuance of common stock by exercise of stock options			5,965			12,654
Payment of withholding taxes relating to stock-based compensation			(3,763)			(9,401)
Payment of dividends to holders of common stock			(30,813)			(20,817)
Net cash (used in) provided by financing activities			(883,905)			3,168,197
Net decrease in cash			(76,296)			(343,035)
Cash at beginning of period			238,482			938,371
Cash at end of period		$	162,186		$	595,336
Supplemental cash flow information:
Cash paid for interest		$	457,513		$	373,389
Cash paid for income taxes, net		$	1,443		$	660
Non-cash investing activities:
Mortgage servicing rights received from loan sales		$	1,464,887		$	953,727
Operating right-of-use assets recognized		$	1,209		$	—
Non-cash financing activities:
Issuance of common stock in settlement of directors' fees		$	115		$	142

The accompanying notes are an integral part of these consolidated financial statements. 10

Table of Contents PENNYMAC FINANCIAL SERVICES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 1—Organization

PennyMac Financial Services, Inc. (together, with its consolidated subsidiaries, unless the context indicates otherwise, “PFSI” or the “Company”) is a holding corporation and its primary assets are equity interests in Private National Mortgage Acceptance Company, LLC (“PNMAC”). The Company is the managing member of PNMAC, and it operates and controls all of the businesses and consolidates the financial results of PNMAC and its subsidiaries.

PNMAC is a Delaware limited liability company which, through its subsidiaries, engages in mortgage banking and investment management activities. PNMAC’s mortgage banking activities consist of residential mortgage loan production and servicing. PNMAC’s investment management activities and a portion of its mortgage banking activities are conducted on behalf of PennyMac Mortgage Investment Trust, a real estate investment trust that invests in residential mortgage-related assets that is separately listed on the New York Stock Exchange under the ticker symbol “PMT”. PNMAC’s primary wholly owned subsidiaries are:

●

PennyMac Loan Services, LLC (“PLS”) — a Delaware limited liability company that services portfolios of residential mortgage loans on behalf of non-affiliates and PMT, purchases, originates and sells new prime credit quality residential mortgage loans and engages in other mortgage banking activities for its own account and the account of PMT. PLS has mortgage banking services, loan servicing, mortgage loan purchase and mortgage servicing rights (“MSRs”) recapture agreements with PMT.

PLS is approved as a seller/servicer of mortgage loans by the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”) and as an issuer of securities guaranteed by the Government National Mortgage Association (“Ginnie Mae”). PLS is a licensed Federal Housing Administration Nonsupervised Title II Lender with the U.S. Department of Housing and Urban Development (“HUD”) and a lender/servicer with the U.S. Department of Veterans Affairs and U.S. Department of Agriculture (each of the above an “Agency” and collectively the “Agencies”).

●	PNMAC Capital Management, LLC (“PCM”) — a Delaware limited liability company registered with the Securities and Exchange Commission (“SEC”) as an investment adviser under the Investment Advisers Act of 1940, as amended. PCM has a management agreement with PMT.

Note 2—Basis of Presentation and Recently Issued Accounting Pronouncements

Basis of Presentation

The accompanying consolidated financial statements have been prepared in compliance with accounting principles generally accepted in the United States (“GAAP”) as codified in the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification for interim financial information and with the SEC’s instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, these consolidated financial statements and notes do not include all of the information required by GAAP for complete financial statements. This interim consolidated information should be read together with the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

The accompanying consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, income, and cash flows for the interim periods presented, but are not necessarily indicative of income that may be expected for the full year ending December 31, 2025. Intercompany accounts and transactions have been eliminated.

Preparation of financial statements in compliance with GAAP requires the Company to make judgments and estimates that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the reporting period. Actual results will likely differ from those estimates.

Table of Contents

Recently Issued Accounting Pronouncement

Income Tax Disclosures

The FASB issued Accounting Standards Update 2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”), that is intended to enhance the level of detail and decision usefulness of income tax disclosures. ASU 2023-09 requires disclosures of:

●	Reconciliation of the expected tax at the applicable statutory federal income tax rate to the reported tax in a tabular format, using both percentages and amounts, broken out into specific categories with certain reconciling items of five percent or greater of the expected tax further broken out by nature and/or jurisdiction; and

●	Income taxes paid, net of refunds received, broken out between federal and state and local income taxes. Payments to individual jurisdictions representing five percent or more of the total income tax payments must also be separately disclosed.

The disclosures specified by ASU 2023-09 are required in the Company’s annual financial statements beginning with the year ended December 31, 2025, with early adoption permitted. The Company is evaluating the effect of ASU 2023-09 on its future disclosures.

Note 3—Concentration of Risk

A portion of the Company’s activities relate to PMT. Revenues generated from PMT (generally comprised of gains on loans held for sale, loan origination and fulfillment fees, loan servicing fees, management fees, change in fair value of investment in and dividends received from PMT, and expense allocations charged to PMT) totaled 10% and 8% of total net revenues for the quarters ended June 30, 2025 and 2024, respectively, and 10% and 9% for the six months ended June 30, 2025 and 2024, respectively.

The Company maintains cash and short-term investment balances at financial institutions in excess of the Federal Deposit Insurance Corporation (“FDIC”) insurance limits. Should one or more of the financial institutions at which the Company’s deposits are maintained fail, there is no guarantee as to the extent that the Company would recover the funds deposited, whether through FDIC coverage or otherwise, or the timing of any recovery.

Note 4—Variable Interest Entities

The Company entered into securitization transactions in which PLS transfers participation certificates in its Ginnie Mae and Fannie Mae MSRs to variable interest entities (“VIEs”) that issue variable funding notes (“VFNs”) to PLS and term debt backed by the participation certificates. PLS finances the VFNs by selling them under agreements to repurchase. The Company acts as guarantor of the VFNs and term debt. The Company determined that it is the primary beneficiary of the VIEs because as the holder of the VFNs and guarantor of the VFNs and term debt, it holds the variable interests in the VIEs. Therefore, PFSI consolidates the VIEs.

For financial reporting purposes, the MSRs financed by the consolidated VIEs are included in Mortgage servicing rights at fair value, the financing of VFNs is included in Assets sold under agreements to repurchase and the term debt is included in Notes payable secured by mortgage servicing assets on the Company’s consolidated balance sheets. This financing is detailed in Note 14 – Short-Term Debt and Note 15 – Long-Term Debt.

Table of Contents Note 5—Related Party Transactions

PennyMac Mortgage Investment Trust

Operating Activities

Mortgage Loan Production Activities and MSR Recapture

Mortgage Loan Purchase Agreement

The Company sells newly originated loans to PMT under a mortgage loan purchase agreement. The Company has typically utilized the mortgage loan purchase agreement for the purpose of selling to PMT conforming balance non-government insured or guaranteed loans, as well as prime jumbo residential mortgage loans.

MSR Recapture Agreement

Pursuant to the terms of an MSR recapture agreement by and between the Company and PMT, if the Company refinances (recaptures) mortgage loans for which PMT holds the MSRs, the Company is generally required to transfer and convey to PMT cash in an amount equal to:

●	70% of the fair market value of the MSRs relating to the recaptured loans subject to the first 30% of the “recapture rate”;

●	50% of the fair market value of the MSRs relating to the recaptured loans subject to the “recapture rate” in excess of 30% and up to 50%;

●	40% of the fair market value of the MSRs relating to the recaptured loans subject to the “recapture rate” in excess of 50%; and

●	a recapture fee of $900 per loan if PLS originates a mortgage loan for the purpose of purchasing a property where the customer has or had a mortgage loan for which PMT holds or held the MSR.

The “recapture rate” means, during each month, the ratio of (i) the aggregate unpaid principal balance of all refinance mortgage loans originated in such month, plus the aggregate unpaid principal balance of all “preserved mortgage loans” relating to closed end second lien loans originated in such month, to (ii) the aggregate unpaid principal balance of all mortgage loans from the portfolio that PLS has determined in good faith were refinanced in such month, plus the aggregate unpaid principal balance of all “preserved mortgage loans” in such month. For purposes of such calculation, “preserved mortgage loan” means a mortgage loan in PMT’s portfolio as to which PLS or its affiliates originated a new closed end second lien loan in a subordinate position to such mortgage loan. The company has further agreed to allocate resources sufficient to target a recapture rate of at least 30%.

Through 2024, the MSR recapture agreement required the Company to transfer cash to PMT in an amount equal to:

●	40% of the fair market value of the MSRs relating to the recaptured loans subject to the first 15% of the “recapture rate”;

●	35% of the fair market value of the MSRs relating to the recaptured loans subject to the “recapture rate” in excess of 15% and up to 30%; and

●	30% of the fair market value of the MSRs relating to the recaptured loans subject to the “recapture rate” in excess of 30%.

Table of Contents The “recapture rate” meant, during each month, the ratio of (i) the aggregate unpaid principal balance of all recaptured mortgage loans, to (ii) the aggregate unpaid principal balance of all mortgage loans for which the Company held the MSRs and that were refinanced or otherwise paid off in such month.

The MSR recapture agreement expires on December 31, 2029, subject to automatic renewal for an additional 18-month period unless terminated in accordance with the terms of the agreement.

Mortgage Banking Services Agreement

Fulfillment Fees

The Company provides PMT with certain mortgage banking services, including fulfillment and disposition-related services, for which it receives a monthly fulfillment fee. Pursuant to the terms of a mortgage banking services agreement, the fulfillment fees shall not exceed the following:

●

the number of non-Ginnie Mae loan commitments issued during the quarter after applying a pull-through factor of either .99 or .80 depending on whether the loan commitments are subject to a “mandatory trade confirmation” or a “best efforts lock confirmation”, respectively, and then multiplied by $585 for each pull-through adjusted loan commitment up to and including 16,500 per quarter and $355 for each pull-through adjusted loan commitment in excess of 16,500 per quarter, and then multiplied by a ratio of (i) the number of loan commitments relating to loans intended to be purchased by PMT during the quarter and thereafter retained by PMT prior to sale or securitization, to (ii) the total number of non-Ginnie Mae loan commitments issued during the quarter (as determined after applying the applicable pull-through factor to each such non-Ginnie Mae loan commitment), plus

●

$315 multiplied by the number of purchased loans up to and including 16,500 per quarter and $195 multiplied by the number of purchased loans in excess of 16,500 per quarter, multiplied by a ratio of (i) the number of loans purchased by PMT during the quarter and thereafter retained by PMT prior to sale or securitization, to (ii) the total number of non-Ginnie Mae loans purchased during the quarter, plus

●

$500 multiplied by the number of all purchased loans that are securitized or sold to parties other than Fannie Mae or Freddie Mac; provided however, that no fulfillment fee shall be due or payable to the Company with respect to any Ginnie Mae mortgage loans, any Fannie Mae mortgage loan or Freddie Mac mortgage loan acquired from PMT by the Company on a discretionary basis, or any mortgage loan acquired by PMT from the Company on or before June 30, 2025, provided that supplemental fees may still be charged in connection with the securitization or sale of any such mortgage loans.

Through 2024, the mortgage banking services agreement provided for a quarterly fulfillment fee not to exceed the following:

●

the number of loan commitments issued multiplied by a pull-through factor of either .99 or .80 depending on whether the loan commitments were subject to a “mandatory trade confirmation” or a “best efforts lock confirmation”, respectively, and then multiplied by $585 for each pull-through adjusted loan commitment up to and including 16,500 loan commitments per quarter and $355 for each pull-through adjusted loan commitment in excess of 16,500 per quarter, plus

●	$315 multiplied by the number of purchased loans that were sold to Fannie Mae or Freddie Mac up to and including 16,500 loans per quarter and $195 multiplied by the number of such purchased loans in excess of 16,500 per quarter, plus

●	$750 multiplied by the number of all purchased loans that are sold or securitized to parties other than Fannie Mae or Freddie Mac; provided, however, that no fulfillment fee was due or payable to PLS with respect to any Ginnie Mae loans and certain Fannie Mae or Freddie Mac loans acquired by PLS.

Table of Contents Sourcing Fees

PMT does not hold the Ginnie Mae approval required to issue Ginnie Mae mortgage-backed securities (“MBS”) and act as a servicer. Accordingly, under the agreement, the Company purchases mortgage loans underwritten in accordance with the Ginnie Mae MBS Guide “as is” and without recourse of any kind from PMT at PMT’s cost less an administrative fee plus accrued interest and sourcing fee ranging from one to two basis points of the unpaid principal balance (“UPB”) of the loan, generally based on the average number of calendar days the loans are held by PMT before purchase by the Company. The Company may also acquire conventional loans from PMT on the same terms upon mutual agreement between PMT and the Company.

While the Company purchases these mortgage loans “as is” and without recourse of any kind from PMT, where the Company has a claim for repurchase, indemnity or otherwise against a correspondent seller, it is entitled, at its sole expense, to pursue any such claim through or in the name of PMT.

In December 2024, the mortgage banking services agreement was renewed and amended to provide for the Company to assume the role of initial correspondent loan purchaser in place of PMT effective July 1, 2025. Under this agreement, PMT retains the right to purchase up to 100% of the non-government insured or guaranteed loans purchased by the Company through its correspondent operations at the Company’s cost plus accrued interest, less any loan administrative fees paid to the Company by the correspondent sellers and subject to quarterly fulfillment fee charges as previously described. The Company may hold or otherwise sell correspondent lending loans to other investors if PMT chooses not to purchase such loans. Accordingly, the sourcing fee arrangement will no longer have any effect for correspondent loans locked on July 1, 2025 and after.

The mortgage banking services agreement expires on December 31, 2029, subject to automatic renewal for an additional 18-month period unless terminated in accordance with the terms of the agreement.

Following is a summary of loan production and MSR recapture activities, between the Company and PMT:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Net gains (losses) on loans held for sale at fair value:
Net gains on loans sold to PMT (primarily cash)		$	8,549		$	—		$	14,595		$	—
Mortgage servicing rights recapture incurred			(1,474)			(473)			(2,682)			(826)
		$	7,075		$	(473)		$	11,913		$	(826)
Sale of loans held for sale to PMT		$	1,034,884		$	—		$	1,689,692		$	—
UPB of loans recaptured		$	183,051		$	74,208		$	342,523		$	136,281

Tax service fees earned from PMT included in Loan origination fees		$	502		$	431		$	979		$	790

Fulfillment fee revenue		$	5,814		$	4,427		$	11,104		$	8,443
Unpaid principal balance of loans fulfilled for PMT subject to fulfillment fees		$	3,085,840		$	2,229,397		$	5,867,562		$	4,001,078

Sourcing fees included in cost of loans purchased from PMT		$	2,658		$	2,050		$	4,673		$	3,655
Unpaid principal balance of loans purchased from PMT:
Government guaranteed or insured		$	12,966,563		$	10,500,415		$	24,158,443		$	18,357,340
Conventional conforming			13,520,693			10,006,706			22,481,489			18,196,636
		$	26,487,256		$	20,507,121		$	46,639,932		$	36,553,976

Table of Contents Servicing Agreement

The Company and PMT have entered into a loan servicing agreement (the “Servicing Agreement”), pursuant to which the Company provides subservicing for PMT’s MSRs and servicing for its portfolio of residential mortgage loans.

●	The base servicing fees for mortgage loans are calculated through a monthly per-loan dollar amount. The base servicing fee rates are $7.50 per month for fixed-rate loans and $8.50 per month for adjustable-rate loans.

●

To the extent that mortgage loans become delinquent, the Company is entitled to an additional servicing fee per loan ranging from $18 to $80 per month based on the delinquency, bankruptcy and foreclosure status of the loan or $75 per month if the underlying mortgaged property becomes real estate acquired in settlement of loans (“REO”). The Company is also entitled to customary ancillary income and certain market-based fees and charges, including boarding and deboarding fees, liquidation and disposition fees, assumption, modification and origination fees and a percentage of late charges.

Following is a summary of loan servicing fees earned from PMT:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Base fees		$	19,151		$	19,181		$	38,354		$	38,378
Other fees			2,494			1,083			5,020			2,148
		$	21,645		$	20,264		$	43,374		$	40,526

Through 2024, the loan servicing fees were established based on whether the serviced loans were “prime” loans (loans included in PMT’s MSRs, private label securitization portfolios and its inventory of loans held for sale) or “special servicing” loans (loans purchased by PMT with credit deterioration) as follows:

Prime Servicing

●	The base servicing fees for prime loans were calculated through a monthly per-loan dollar amount, with the actual dollar amount for each loan based on whether the loan was a fixed-rate or adjustable-rate loan. The base servicing fee rates were $7.50 per month for fixed-rate loans and $8.50 per month for adjustable-rate loans.

●

To the extent that prime loans became delinquent, the Company was entitled to an additional servicing fee per loan ranging from $10 to $55 per month based on the delinquency, bankruptcy and foreclosure status of the loan or $75 per month if the underlying mortgaged property became REO. The Company was also entitled to customary ancillary income and certain market-based fees and charges, including boarding and deboarding fees, liquidation and disposition fees, assumption, modification and origination fees and a percentage of late charges.

Special Servicing

●	The base servicing fee rates for special servicing loans ranged from $30 per month for current loans up to $95 per month for loans in foreclosure proceedings. The base servicing fee rate for REO was $75 per month. The Company also received a supplemental servicing fee of $25 per month for each special servicing loan.

●	The Company received activity-based fees for modifications, foreclosures and liquidations that it facilitated with respect to special servicing loans, as well as other market-based refinancing and loan disposition fees.

The Servicing Agreement expires on December 31, 2029, subject to automatic renewal for an additional 18-month period unless terminated in accordance with the terms of the agreement.

Table of Contents Management Agreement

The Company has a management agreement with PMT (the “Management Agreement”), pursuant to which the Company oversees PMT’s business affairs in conformity with PMT’s investment policies for which the Company collects a base management fee and may collect a performance incentive fee. The Management Agreement provides that:

●

The base management fee is calculated and collected quarterly in arrears and is equal to the sum of (i) 1.5% per year of PMT’s average shareholders’ equity up to $2 billion, (ii) 1.375% per year of PMT’s average “shareholders’ equity” in excess of $2 billion and up to $5 billion, and (iii) 1.25% per year of PMT’s average “shareholders’ equity” in excess of $5 billion. “Shareholders’ equity” is defined as the sum of net proceeds from issuance and repurchases of equity securities since inception, plus retained earnings or reduced by accumulated deficit.

●	The performance incentive fee is calculated and collected annually in arrears and is a specified percentage of the amount by which PMT’s “net income,” over the fiscal year and before deducting the incentive fee, exceeds certain levels of return on “common shareholders’ equity.”

●	The performance incentive fee is equal to the sum of:

●	10% of the amount by which PMT’s “net income” for the year exceeds (i) an 8% return on the average “common shareholders’ equity” during the period plus the “high watermark,” up to (ii) a 12% return on PMT’s “common shareholders’ equity”; plus
●	15% of the amount by which PMT’s “net income” for the year exceeds (i) a 12% return on the average PMT’s “common shareholders’ equity” during the period plus the “high watermark,” up to (ii) a 16% return on PMT’s “common shareholders’ equity”; plus
---	---
●	20% of the amount by which PMT’s “net income” for the year exceeds a 16% return on the average PMT’s “common shareholders’ equity” during the period plus the “high watermark.”
---	---

For the purpose of determining the amount of the performance incentive fee:

“Net income” is defined as net income or loss attributable to PMT’s common shares of beneficial interest computed in accordance with GAAP adjusted for certain other non-cash charges determined after discussions between the Company and PMT’s independent trustees and approval by a majority of PMT’s independent trustees.

“Common shareholders’ equity” is defined as “shareholder’s equity” less the average GAAP accounting value of the Company’s preferred equity.

“High watermark” is the annual adjustment that reflects the amount by which the “net income” (stated as a percentage of return on “equity”) in that year exceeds or falls short of the lesser of 8% and the average Fannie Mae 30-year MBS Yield (the “Target Yield”) for the year then ended. If the “net income” is lower than the Target Yield, the high watermark is increased by the difference. If the “net income” is higher than the Target Yield, the high watermark is reduced by the difference. Each time a performance incentive fee is earned, the high watermark returns to zero. As a result, the threshold amount required for the Company to earn a performance incentive fee is adjusted cumulatively based on the performance of PMT’s net income over (or under) the Target Yield, until the net income in excess of the Target Yield exceeds the then-current cumulative high watermark amount, and a performance incentive fee is earned. The high watermark is calculated based on the two years preceding the fiscal year for which the incentive fee is calculated, and will never be less than zero after including all high watermark increases and high watermark decreases over any such rolling two fiscal year period.

The performance incentive fee may be paid in cash or a combination of cash and PMT’s common shares of beneficial interest (subject to a limit of no more than 50% paid in common shares of beneficial interest), at PMT’s option.

Table of Contents In the event of termination of the Management Agreement between PMT and the Company, the Company may be entitled to a termination fee in certain circumstances. The termination fee is equal to three times the sum of (a) the average annual base management fee, and (b) the average annual performance incentive fee earned by the Company, in each case during the 24-month period immediately preceding the date of termination.

Following is a summary of the base management and performance incentive fees earned from PMT:


	Quarter ended June 30,						Six months ended June 30,
	2025		****	2024		****	2025		****	2024
	(in thousands)
Base management fees	$	6,869		$	7,133		$	13,881		$	14,321
Performance incentive fees		—			—			—			—
	$	6,869		$	7,133		$	13,881		$	14,321
Average PMT's shareholders' equity used to calculate base management and performance incentive fees	$	1,836,690		$	1,912,522		$	1,866,238		$	1,919,962

Through 2024, under the Management Agreement, both base management and performance incentive fees were paid quarterly and the high watermark was measured on a cumulative basis since inception.

The Management Agreement expires on December 31, 2029, subject to automatic renewal for an additional 18-month period unless terminated in accordance with the terms of the agreement.

Expense Reimbursement

Under the Management Agreement, PMT reimburses the Company for its organizational and operating expenses, including third-party expenses, incurred on PMT’s behalf, it being understood that the Company and its affiliates shall allocate a portion of their personnel’s time to provide certain legal, tax, accounting, internal audit and investor relations services for the direct benefit of PMT. PMT is also required to pay its pro rata portion of the rent, telephone, utilities, office furniture, equipment, machinery and other office, internal and overhead expenses of the Company and its affiliates required for PMT’s and its subsidiaries’ operations. These expenses are based on the resources the Company dedicates to investment management activities for PMT, as determined by the Company in its sole discretion.

Through 2024, PMT reimbursed the Company for its organizational and operating expenses, including third-party expenses, incurred on PMT’s behalf, it being understood that the Company and its affiliates would allocate a portion of their personnel’s time to provide certain legal, tax and investor relations services for the direct benefit of PMT. With respect to the allocation of the Company’s and its affiliates’ personnel compensation, the Company was reimbursed $165,000 per fiscal quarter. Overhead expenses were previously allocated based on the ratio of PMT’s proportion of gross assets compared to all remaining gross assets owned or managed by the Company, as calculated at each fiscal quarter end.

The Company received reimbursements from PMT for expenses as follows:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Reimbursement of:
Expenses incurred on PMT's behalf, net		$	4,963		$	2,779		$	9,564		$	9,193
Compensation			1,628			165			3,257			330
Common overhead incurred by the Company			982			2,000			1,963			3,944
		$	7,573		$	4,944		$	14,784		$	13,467
Payments and settlements during the period (1)		$	32,628		$	29,263		$	60,676		$	59,348
(1)	Payments and settlements include payments for the operating, investing and financing activities itemized in this Note.
---	---

Table of Contents Investing Activities

Following is a summary of investing activities between the Company and PMT:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Change in fair value of investment in and dividends received from PennyMac Mortgage Investment Trust shares		$	(105)		$	(40)		$	80		$	(30)


		June 30,			December 31,
	****	2025		****	2024
		(in thousands)
Common shares of beneficial interest of PennyMac Mortgage Investment Trust:
Fair value		$	965		$	944
Number of shares			75			75

Receivable from and Payable to PMT

Amounts receivable from and payable to PMT are summarized below:


		June 30,			December 31,
	****	2025		****	2024
		(in thousands)
Receivable from PMT:
Correspondent production fees		$	10,528		$	11,122
Servicing fees			7,213			6,822
Management fees			6,869			7,149
Allocated expenses and expenses incurred on PMT's behalf			5,994			3,508
Fulfillment fees			—			1,605
		$	30,604		$	30,206
Payable to PMT:
Amounts advanced by PMT to fund its servicing advances		$	71,280		$	106,302
Other			14,894			16,015
		$	86,174		$	122,317

Exchanged Private National Mortgage Acceptance Company, LLC Unitholders

The Company entered into a tax receivable agreement with certain former owners of PNMAC that provides for the payment from time to time by the Company to PNMAC’s exchanged unitholders of an amount equal to 85% of the amount of the net tax benefits, if any, that the Company is deemed to realize as a result of (i) increases in tax basis of PNMAC’s assets resulting from exchanges of ownership interests in PNMAC and (ii) certain other tax benefits related to entering into the tax receivable agreement, including tax benefits attributable to payments under the tax receivable agreement. The Company has recorded a $24.8 million and $25.9 million Payable to exchanged Private National Mortgage Acceptance Company, LLC unitholders under tax receivable agreement as of June 30, 2025 and December 31, 2024, respectively. During the quarter ended June 30, 2025, the Company recorded a $1.1 million reduction to its estimate of the liability relating to a change in the tax rate applicable to its deferred income tax liability. The Company did not make payments under the tax receivable agreement during the quarter and six-month periods ended June 30, 2025 and 2024.

. 19

Table of Contents Note 6—Loan Sales and Servicing Activities

The Company originates, purchases and sells loans in the secondary mortgage market without recourse for credit losses. However, the Company maintains continuing involvement with the loans in the form of servicing arrangements and the liability under representations and warranties it makes to purchasers and insurers of the loans.

The following table summarizes cash flows between the Company and transferees as a result of the sale of loans in transactions where the Company maintains continuing involvement with the loans as servicer:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Cash flows:
Sales proceeds		$	34,656,042		$	24,860,532		$	62,243,471		$	44,537,449
Servicing fees received		$	411,531		$	348,730		$	807,763		$	684,978

The Company is contractually responsible for making the payments required to protect the loans’ beneficial interest holders’ interests in the properties collateralizing their loans and may, therefore, be required to advance amounts in excess of insurer or guarantor reimbursement limits. Therefore, the Company provides a valuation allowance on the servicing advances for these amounts to adjust their carrying values to amounts that are expected to ultimately be recovered from the loans’ insurers, guarantors, or beneficial interest holders.

The servicing advance valuation allowance is estimated based on relevant qualitative and quantitative information about past events, including historical collection and loss experience, current conditions, and reasonable and supportable forecasts that affect collectable amounts. The provision for losses on servicing advances is included in Servicing expense in the consolidated statements of income. Servicing advances are written off when they are deemed unrecoverable.

The following is a summary of the allowance for losses on servicing advances:


	Quarter ended June 30,					Six months ended June 30,
	2025		2024		****	2025		2024
	(in thousands)
Balance at beginning of period	$	82,155	$	67,327		$	85,788	$	73,991
Provision for losses		7,786		5,932			11,970		4,391
Charge-offs, net		(7,916)		(4,588)			(15,733)		(9,711)
Balance at end of period	$	82,025	$	68,671		$	82,025	$	68,671

The following table summarizes the UPB of the loans sold by the Company in transactions where it maintains continuing involvement with the loans as servicer:


			June 30,			December 31,
	****	****	2025		****	2024
			(in thousands)
Unpaid principal balance of loans outstanding			$	448,312,667		$	410,393,342
Delinquent loans:
30-89 days			$	17,747,455		$	17,301,961
90 days or more:
Not in foreclosure			$	6,819,040		$	8,104,348
In foreclosure			$	1,183,032		$	693,934
Foreclosed			$	3,254		$	2,928
Loans in bankruptcy			$	1,936,703		$	1,762,324

Table of Contents The following tables summarize the Company’s loan servicing portfolio as measured by UPB:


		June 30, 2025
		Servicing						Total
	****	rights owned		****	Subservicing		****	loans serviced
		(in thousands)
Investor:
Non-affiliated entities:
Originated		$	448,312,667		$	—		$	448,312,667
Purchased			14,837,637			—			14,837,637
Subserviced			—			894,678			894,678
			463,150,304			894,678			464,044,982
PennyMac Mortgage Investment Trust			—			228,838,699			228,838,699
Loans held for sale			6,783,240			—			6,783,240
		$	469,933,544		$	229,733,377		$	699,666,921
Delinquent loans:
30 days		$	13,661,146		$	2,224,538		$	15,885,684
60 days			4,676,437			592,689			5,269,126
90 days or more:
Not in foreclosure			7,030,633			1,080,547			8,111,180
In foreclosure			1,174,802			130,242			1,305,044
Foreclosed			4,264			1,815			6,079
		$	26,547,282		$	4,029,831		$	30,577,113
Loans in bankruptcy		$	2,022,830		$	328,672		$	2,351,502
Custodial funds managed by the Company (1)		$	7,690,392		$	3,037,614		$	10,728,006
(1)	Custodial funds include cash accounts holding funds on behalf of borrowers and investors relating to loans serviced under servicing agreements and are not recorded on the Company’s consolidated balance sheets. The Company earns placement fees on certain of these custodial funds where it owns the MSRs and these fees are included in Interest income in the Company’s consolidated statements of income.
---	---

Table of Contents


		December 31, 2024
		Servicing						Total
	****	rights owned		****	Subservicing		****	loans serviced
		(in thousands)
Investor:
Non-affiliated entities:
Originated		$	410,393,342		$	—		$	410,393,342
Purchased			15,681,406			—			15,681,406
Subserviced			—			806,584			806,584
			426,074,748			806,584			426,881,332
PennyMac Mortgage Investment Trust			—			230,753,581			230,753,581
Loans held for sale			8,128,914			—			8,128,914
		$	434,203,662		$	231,560,165		$	665,763,827
Delinquent loans:
30 days		$	13,095,250		$	1,996,821		$	15,092,071
60 days			4,838,550			676,508			5,515,058
90 days or more:
Not in foreclosure			8,289,129			1,210,270			9,499,399
In foreclosure			730,372			106,188			836,560
Foreclosed			3,716			2,732			6,448
		$	26,957,017		$	3,992,519		$	30,949,536
Loans in bankruptcy		$	1,852,396		$	286,093		$	2,138,489
Custodial funds managed by the Company (1)		$	6,171,157		$	2,391,875		$	8,563,032
(1)	Custodial funds include cash accounts holding funds on behalf of borrowers and investors relating to loans serviced under servicing agreements and are not recorded on the Company’s consolidated balance sheets. The Company earns placement fees on certain of these custodial funds where it owns the MSRs and these fees are included in Interest income in the Company’s consolidated statements of income.
---	---

Following is a summary of the geographical distribution of loans included in the Company’s loan servicing portfolio for the top five and all other states as measured by UPB:


		June 30,			December 31,
State	****	2025		****	2024		****
		(in thousands)
California		$	79,108,662		$	76,364,993
Texas			69,822,668			65,317,775
Florida			67,648,262			63,850,638
Virginia			37,358,138			36,428,575
Georgia			29,671,069			28,499,141
All other states			416,058,122			395,302,705
		$	699,666,921		$	665,763,827

Table of Contents Note 7—Fair Value

Most of the Company’s assets and certain of its liabilities are measured at or based on their fair values. The Company groups its assets and liabilities at fair value in three levels, based on the markets in which the assets and liabilities are traded and the observability of the significant inputs used to determine the fair values. These levels are:

●	Level 1—Quoted prices in active markets for identical assets or liabilities.

●	Level 2—Prices determined using other significant observable inputs. Observable inputs are inputs that other market participants would use in pricing an asset or liability and are developed based on market data obtained from sources independent of the Company.

●	Level 3— Prices determined using significant unobservable inputs. In situations where observable inputs are unavailable, unobservable inputs may be used. Unobservable inputs reflect the Company’s own judgments about the factors that market participants use in pricing an asset or liability, and are based on the best information available in the circumstances.

As a result of the difficulty in observing certain significant valuation inputs affecting “Level 3” fair value assets and liabilities, the Company is required to make judgments regarding these items’ fair values. Different persons in possession of the same facts may reasonably arrive at different conclusions as to the inputs to be applied in valuing these assets and liabilities and their fair values. Such differences may result in significantly different fair value measurements. Likewise, due to the general illiquidity of some of these assets and liabilities, subsequent transactions may be at values significantly different from those reported.

The Company reclassifies its assets and liabilities between levels of the fair value hierarchy when the inputs required to establish fair value at a level of the fair value hierarchy are no longer readily available, requiring the use of lower-level inputs, or when the inputs required to establish fair value at a higher level of the hierarchy become available.

Table of Contents

Fair Value Accounting Elections

The Company identified its MSRs, its mortgage servicing liabilities (“MSLs”) and all of its non-cash financial assets to be accounted for at fair value so changes in fair value will be reflected in income as they occur and more timely reflect the results of the Company’s performance.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Following is a summary of assets and liabilities that are measured at fair value on a recurring basis:


		June 30, 2025
	****	Level 1		****	Level 2		****	Level 3		****	Total
		(in thousands)
Assets:
Short-term investment		$	462,262		$	—		$	—		$	462,262
Principal-only stripped mortgage-backed securities			—			784,958			—			784,958
Loans held for sale			—			6,450,311			510,913			6,961,224
Derivative assets:
Interest rate lock commitments			—			—			143,061			143,061
Forward purchase contracts			—			89,834			—			89,834
Forward sales contracts			—			2,939			—			2,939
Put options on interest rate futures purchase contracts			996			—			—			996
Call options on interest rate futures purchase contracts			33,688			—			—			33,688
Total derivative assets before netting			34,684			92,773			143,061			270,518
Netting			—			—			—			(89,876)
Total derivative assets			34,684			92,773			143,061			180,642
Mortgage servicing rights			—			—			9,531,249			9,531,249
Investment in PennyMac Mortgage Investment Trust			965			—			—			965
		$	497,911		$	7,328,042		$	10,185,223		$	17,921,300
Liabilities:
Derivative liabilities:
Interest rate lock commitments		$	—		$	—		$	908		$	908
Forward purchase contracts			—			174			—			174
Forward sales contracts			—			159,266			—			159,266
Call options on interest rate futures sale contracts			10,063			—			—			10,063
Total derivative liabilities before netting			10,063			159,440			908			170,411
Netting			—			—			—			(137,908)
Total derivative liabilities			10,063			159,440			908			32,503
Derivative liability to PMT			—			1,038			—			1,038
Mortgage servicing liabilities			—			—			1,643			1,643
		$	10,063		$	160,478		$	2,551		$	35,184

Table of Contents


		December 31, 2024
	****	Level 1		****	Level 2		****	Level 3		****	Total
		(in thousands)
Assets:
Short-term investment		$	420,553		$	—		$	—		$	420,553
Principal-only stripped mortgage-backed securities			—			825,865			—			825,865
Loans held for sale			—			7,783,415			434,053			8,217,468
Derivative assets:
Interest rate lock commitments			—			—			56,946			56,946
Forward purchase contracts			—			3,701			—			3,701
Forward sales contracts			—			152,526			—			152,526
MBS put options			—			3,278			—			3,278
Put options on interest rate futures purchase contracts			12,592			—			—			12,592
Call options on interest rate futures purchase contracts			3,250			—			—			3,250
Total derivative assets before netting			15,842			159,505			56,946			232,293
Netting			—			—			—			(119,217)
Total derivative assets			15,842			159,505			56,946			113,076
Mortgage servicing rights			—			—			8,744,528			8,744,528
Investment in PennyMac Mortgage Investment Trust			944			—			—			944
		$	437,339		$	8,768,785		$	9,235,527		$	18,322,434
Liabilities:
Derivative liabilities:
Interest rate lock commitments		$	—		$	—		$	23,381		$	23,381
Forward purchase contracts			—			66,646			—			66,646
Forward sales contracts			—			12,854			—			12,854
Total derivative liabilities before netting			—			79,500			23,381			102,881
Netting			—			—			—			(61,981)
Total derivative liabilities			—			79,500			23,381			40,900
Mortgage servicing liabilities			—			—			1,683			1,683
		$	—		$	79,500		$	25,064		$	42,583

Table of Contents As shown above, certain of the Company’s loans held for sale, interest rate lock commitments (“IRLCs”), MSRs and MSLs are measured using Level 3 fair value inputs. Following are roll forwards of assets and liabilities measured at fair value using “Level 3” inputs at either the beginning or the end of the period presented:


		Quarter ended June 30, 2025
					Interest			Mortgage
		Loans held			rate lock			servicing
Assets	****	for sale		****	commitments, net (1)		****	rights		****	Total
		(in thousands)
Balance, March 31, 2025		$	441,621		$	109,942		$	8,963,889		$	9,515,452
Purchases and issuances, net			1,513,042			172,987			—			1,686,029
Capitalization of interest and servicing advances			27,315			—			—			27,315
Sales and repayments			(537,122)			—			—			(537,122)
Mortgage servicing rights resulting from loan sales			—			—			814,538			814,538
Changes in fair value included in income arising from:
Changes in instrument-specific credit risk			38,010			—			—			38,010
Other factors			4,853			67,548			(247,178)			(174,777)
			42,863			67,548			(247,178)			(136,767)
Transfers:
From Level 3 to Level 2			(976,806)			—			—			(976,806)
To loans held for sale			—			(208,324)			—			(208,324)
Balance, June 30, 2025		$	510,913		$	142,153		$	9,531,249		$	10,184,315
Changes in fair value recognized during the quarter relating to assets still held at June 30, 2025		$	25,494		$	142,153		$	(247,178)		$	(79,531)
(1)	For the purpose of this table, the IRLC asset and liability positions are shown net.
---	---


		Quarter ended
Liabilities	****	June 30, 2025
		(in thousands)
Mortgage servicing liabilities:
Balance, March 31, 2025		$	1,651
Changes in fair value included in income			(8)
Balance, June 30, 2025		$	1,643
Changes in fair value recognized during the quarter relating to liabilities still outstanding at June 30, 2025		$	(8)

Table of Contents


		Quarter ended June 30, 2024
					Interest			Mortgage
		Loans held			rate lock			servicing
Assets		for sale		****	commitments, net (1)		****	rights		****		Total
	****	(in thousands)
Balance, March 31, 2024		$	466,392		$	69,808		$	7,483,210		$	8,019,410
Purchases and issuances, net			954,081			128,241			—			1,082,322
Capitalization of interest and servicing advances			14,110			—			—			14,110
Sales and repayments			(356,988)			—			—			(356,988)
Mortgage servicing rights resulting from loan sales			—			—			541,207			541,207
Changes in fair value included in income arising from:
Changes in instrument-specific credit risk			28,011			—			—			28,011
Other factors			(536)			19,542			(101,339)			(82,333)
			27,475			19,542			(101,339)			(54,322)
Transfers from Level 3 to Level 2			(704,994)			—			—			(704,994)
Transfers to loans held for sale			—			(148,839)			—			(148,839)
Balance, June 30, 2024		$	400,076		$	68,752		$	7,923,078		$	8,391,906
Changes in fair value recognized during the quarter relating to assets still held at June 30, 2024		$	21,684		$	68,752		$	(101,339)		$	(10,903)
(1)	For the purpose of this table, the IRLC asset and liability positions are shown net.
---	---


Liabilities	Quarter ended June 30, 2024
	(in thousands)
Mortgage servicing liabilities:
Balance, March 31, 2024	$	1,732
Changes in fair value included in income		(24)
Balance, June 30, 2024	$	1,708
Changes in fair value recognized during the quarter relating to liabilities still outstanding at June 30, 2024	$	(24)


		Six months ended June 30, 2025
					Interest			Mortgage
		Loans held			rate lock			servicing
Assets		for sale		****	commitments, net (1)		****	rights		****	Total
	****	(in thousands)
Balance, December 31, 2024		$	434,053		$	33,565		$	8,744,528		$	9,212,146
Purchases and issuances, net			2,896,927			355,530			—			3,252,457
Capitalization of interest and servicing advances			37,947			—			—			37,947
Sales and repayments			(1,051,768)			—			—			(1,051,768)
Mortgage servicing rights resulting from loan sales			—			—			1,464,887			1,464,887
Changes in fair value included in income arising from:
Changes in instrument-specific credit risk			67,629			—			—			67,629
Other factors			14,168			183,661			(678,166)			(480,337)
			81,797			183,661			(678,166)			(412,708)
Transfers:
From Level 3 to Level 2			(1,888,043)			—			—			(1,888,043)
To loans held for sale			—			(430,603)			—			(430,603)
Balance, June 30, 2025		$	510,913		$	142,153		$	9,531,249		$	10,184,315
Changes in fair value recognized during the period relating to assets still held at June 30, 2025		$	28,691		$	142,153		$	(678,166)		$	(507,322)
(1)	For the purpose of this table, the IRLC asset and liability positions are shown net.
---	---

Table of Contents


	Six months ended
Liabilities	June 30, 2025
	(in thousands)
Mortgage servicing liabilities:
Balance, December 31, 2024	$	1,683
Changes in fair value included in income		(40)
Balance, June 30, 2025	$	1,643
Changes in fair value recognized during the period relating to liabilities still outstanding at June 30, 2025	$	(40)


		Six months ended June 30, 2024
					Interest			Mortgage
		Loans held			rate lock			servicing
Assets	****	for sale		****	commitments, net (1)		****	rights		****	Total
		(in thousands)
Balance, December 31, 2023		$	478,564		$	89,593		$	7,099,348		$	7,667,505
Purchases and issuances, net			1,859,941			228,512			—			2,088,453
Capitalization of interest and servicing advances			25,336			—			—			25,336
Sales and repayments			(740,987)			—			—			(740,987)
Mortgage servicing rights resulting from loan sales			—			—			953,727			953,727
Changes in fair value included in income arising from:
Changes in instrument-specific credit risk			45,153			—			—			45,153
Other factors			(1,108)			31,066			(129,997)			(100,039)
			44,045			31,066			(129,997)			(54,886)
Transfers:
From Level 3 to Level 2			(1,266,823)			—			—			(1,266,823)
To loans held for sale			—			(280,419)			—			(280,419)
Balance, June 30, 2024		$	400,076		$	68,752		$	7,923,078		$	8,391,906
Changes in fair value recognized during the period relating to assets still held at June 30, 2024		$	20,917		$	68,752		$	(129,997)		$	(40,328)
(1)	For purpose of this table, the IRLC asset and liability positions are shown net.
---	---


Liabilities	Six months ended June 30, 2024
	(in thousands)
Mortgage servicing liabilities:
Balance, December 31, 2023	$	1,805
Changes in fair value included in income		(97)
Balance, June 30, 2024	$	1,708
Changes in fair value recognized during the period relating to liabilities still outstanding at June 30, 2024	$	(97)

Table of Contents

Assets and Liabilities Measured at Fair Value under the Fair Value Option

Net changes in fair values included in income for assets and liabilities carried at fair value, as a result of management’s election of the fair value option, by income statement line item are summarized below:


		Quarter ended June 30,
		2025									2024
		Net gains on			Net						Net gains on			Net
		loans held			loan						loans held			loan
		for sale at			servicing						for sale at			servicing
	****	fair value		****	fees		****	Total		****	fair value		****	fees		****	Total
		(in thousands)
Assets:
Principal-only stripped mortgage-backed securities		$	—		$	7,192		$	7,192		$	—		$	(16,460)		$	(16,460)
Loans held for sale			223,741			—			223,741			124,874			—			124,874
Mortgage servicing rights			—			(247,178)			(247,178)			—			(101,339)			(101,339)
		$	223,741		$	(239,986)		$	(16,245)		$	124,874		$	(117,799)		$	7,075
Liabilities:
Mortgage servicing liabilities		$	—		$	8		$	8		$	—		$	24		$	24


	Six months ended June 30,
	2025									2024
	Net gains on			Net						Net gains on			Net
	loans held			loan						loans held			loan
	for sale at			servicing						for sale at			servicing
	fair value		****	fees		****	Total		****	fair value		****	fees		****	Total
	(in thousands)
Assets:
Principal-only stripped mortgage-backed securities	$	—		$	25,326		$	25,326		$	—		$	(16,771)		$	(16,771)
Loans held for sale		508,531			—			508,531			254,203			—			254,203
Mortgage servicing rights		—			(678,166)			(678,166)			—			(129,997)			(129,997)
	$	508,531		$	(652,840)		$	(144,309)		$	254,203		$	(146,768)		$	107,435
Liabilities:
Mortgage servicing liabilities	$	—		$	40		$	40		$	—		$	97		$	97

Following are the fair value and related principal amounts due upon maturity of loans held for sale:


		June 30, 2025									December 31, 2024
					Principal									Principal
					amount									amount
		Fair			due upon						Fair			due upon
Loans held for sale	****	value		****	maturity		****	Difference		****	value		****	maturity		****	Difference
		(in thousands)
Current through 89 days delinquent		$	6,929,950		$	6,734,644		$	195,306		$	8,187,561		$	8,089,532		$	98,029
90 days or more delinquent:
Not in foreclosure			23,534			27,248			(3,714)			24,663			27,901			(3,238)
In foreclosure			7,740			21,348			(13,608)			5,244			11,481			(6,237)
		$	6,961,224		$	6,783,240		$	177,984		$	8,217,468		$	8,128,914		$	88,554

Table of Contents

Assets Measured at Fair Value on a Nonrecurring Basis

Following is a summary of assets that were measured at fair value on a nonrecurring basis:


Real estate acquired in settlement of loans		Level 1		****	Level 2		****	Level 3		****	Total
	****	(in thousands)
June 30, 2025		$	—		$	—		$	6,125		$	6,125
December 31, 2024		$	—		$	—		$	5,238		$	5,238

The following table summarizes the losses recognized on assets when they were remeasured at fair value on a nonrecurring basis:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Real estate acquired in settlement of loans		$	(367)		$	(685)		$	(1,272)		$	(1,663)

Fair Value of Financial Instruments Carried at Amortized Cost

The Company’s Assets sold under agreements to repurchase, Mortgage loan participation purchase and sale agreements, Notes payable secured by mortgage servicing assets and Unsecured senior notes are carried at amortized cost.

These liabilities are classified as “Level 3” fair value items due to the Company’s reliance on unobservable inputs to estimate their fair values. The Company has concluded that the fair values of these liabilities other than the term notes and term loans included in Notes payable secured by mortgage servicing assets and the Unsecured senior notes approximate their carrying values due to their short terms and/or variable interest rates.

The Company estimates the fair value of the term notes, term loans and the Unsecured senior notes using indications of fair value provided by non-affiliate brokers, pricing services and internal estimates of fair value. The fair values and carrying values of these liabilities are summarized below:


	****	June 30, 2025				****	December 31, 2024
		Fair value		Carrying value			Fair value		Carrying value
		(in thousands)
Term notes and term loans		$	1,233,570	$	1,227,143		$	1,742,421	$	1,724,120
Unsecured senior notes		$	4,329,447	$	4,185,012		$	3,172,983	$	3,164,032

Valuation Governance

Most of the Company’s financial assets, and all of its derivatives, MSRs, and MSLs are carried at fair value with changes in fair value recognized in current period income. Certain of the Company’s financial assets and derivatives and all of its MSRs and MSLs are “Level 3” fair value assets and liabilities which require use of unobservable inputs that are significant to the estimation of the items’ fair values. Unobservable inputs reflect the Company’s own judgments about the factors that market participants use in pricing an asset or liability, and are based on the best information available under the circumstances.

Due to the difficulty in estimating the fair values of “Level 3” fair value assets and liabilities, the Company has assigned responsibility for estimating the fair values of these assets and liabilities to specialized staff within its capital markets group and subjects the valuation process to significant senior management oversight.

Table of Contents With respect to “Level 3” valuations other than IRLCs, the capital markets valuation staff reports to the Company’s senior management valuation subcommittee, which oversees the valuations. The capital markets valuation staff monitors the models used for valuation of the Company’s “Level 3” fair value assets and liabilities, including the models’ performance versus actual results, and reports those results as well as changes in the valuation of the non-IRLC “Level 3” fair value assets and liabilities, including major factors affecting the valuations and any changes in model methods and inputs, to the Company’s senior management valuation subcommittee. The Company’s senior management valuation subcommittee includes the Company’s chief financial, credit, and capital markets officers as well as other senior members of the Company’s finance, risk management and capital markets staffs.

To assess the reasonableness of its valuations, the capital markets valuation staff presents an analysis of the effect on the valuations of changes to the significant inputs to the models and, for MSRs, comparisons of its estimates of fair value and of key inputs to those procured from non-affiliate brokers and published surveys.

The fair value of the Company’s IRLCs is developed by its capital markets risk management staff and is reviewed by its capital markets operations staff.

Valuation Techniques and Inputs

Following is a description of the techniques and inputs used in estimating the fair values of “Level 2” and “Level 3” fair value assets and liabilities:

Principal-Only Stripped Mortgage-Backed Securities

The Company categorizes principal-only stripped MBS as “Level 2” fair value financial instruments. Fair values of these securities are established based on quoted market prices for these or similar securities.

Loans Held for Sale

Most of the Company’s loans held for sale at fair value are saleable into active markets and are therefore categorized as “Level 2” fair value assets. The fair values of “Level 2” fair value loans are determined using their contracted selling prices or quoted market prices or market price equivalents.

Certain of the Company’s loans held for sale are not saleable into active markets and are therefore categorized as “Level 3” fair value assets. Loans held for sale categorized as “Level 3” fair value assets include:

●	Closed-end second lien mortgage loans. At present, there is no active market with significant observable inputs to the estimation of fair value of the closed-end second lien mortgage loans the Company produces.

●

Early buy out (“EBO”) loans. EBO loans are government guaranteed or insured loans purchased by the Company from Ginnie Mae guaranteed securities in its loan servicing portfolio. The Company’s right to purchase a government guaranteed or insured loan from a Ginnie Mae security arises as the result of the loan being at least three months delinquent on the date of purchase by the Company and provides an alternative to the Company’s obligation to continue advancing principal and interest at the coupon rate of the related Ginnie Mae security. Such a loan may be resold to an investor and thereafter may be repurchased to the extent it becomes eligible for resale into a new Ginnie Mae guaranteed security.

A loan becomes eligible for resale into a new Ginnie Mae guaranteed security when the loan becomes current either through completion of a modification of the loan’s terms or after three months of timely payments following either the completion of a payment deferral program or borrower reperformance and when the issuance date of the new security is at least 120 days after the date the loan was last delinquent.

●	Loans with identified defects. Loans that are not saleable into active markets due to identification of a defect by the Company or to the repurchase by the Company of a loan with an identified defect.

Table of Contents The Company uses a discounted cash flow model to estimate the fair value of its “Level 3” fair value loans held for sale. The significant unobservable inputs used in the fair value measurement of the Company’s “Level 3” fair value loans held for sale are discount rates, home price projections, voluntary prepayment/resale and total prepayment/resale speeds. Significant changes in any of those inputs in isolation could result in a significant change to the loans’ fair value measurement. Increases in home price projections are generally accompanied by an increase in voluntary prepayment speeds.

Following is a quantitative summary of key “Level 3” fair value inputs used in the valuation of loans held for sale:



	****	June 30, 2025		****	December 31, 2024
Fair value (in thousands)		$	510,913		$	434,053
Key inputs (1):
Discount rate:
Range			5.8% – 9.3%			6.5% – 9.3%
Weighted average			6.5%			7.0%
Twelve-month projected housing price index change:
Range			1.7% – 2.2%			2.2% – 2.8%
Weighted average			2.0%			2.3%
Voluntary prepayment/resale speed (2):
Range			6.3% – 50.3%			6.4% – 34.4%
Weighted average			29.4%			22.0%
Total prepayment/resale speed (3):
Range			6.4% – 57.3%			6.5% – 41.3%
Weighted average			32.3%			23.9%
(1)	Weighted average inputs are based on the fair values of the “Level 3” fair value loans.
---	---
(2)	Voluntary prepayment/resale speed is measured using life voluntary Conditional Prepayment Rate (“CPR”).
---	---
(3)	Total prepayment/resale speed is measured using life total CPR, which includes both voluntary and involuntary prepayment/resale speeds.
---	---

Changes in fair value of loans held for sale attributable to changes in a loan’s instrument-specific credit risk are measured with reference to the change in the respective loan’s delinquency status and performance history at period end from the later of the beginning of the period or acquisition date. Changes in fair value of loans held for sale are included in Net gains on loans held for sale at fair value in the Company’s consolidated statements of income.

Derivative Financial Instruments

Interest Rate Lock Commitments

The Company categorizes IRLCs as “Level 3” fair value assets or liabilities. The Company estimates the fair values of IRLCs based on quoted Agency MBS prices, the probability that the loans will be funded or purchased (the “pull-through rate”) and its estimate of the fair value of the MSRs it expects to receive in the sale of the loans.

The significant unobservable inputs used in the fair value measurement of the Company’s IRLCs are the pull-through rate and the estimated fair values of MSRs attributable to the mortgage loans it has committed to originate or purchase. Significant changes in the pull-through rate or the MSR components of the IRLCs, in isolation, could result in significant changes in the IRLCs’ fair value measurements. The financial effects of changes in these inputs are generally inversely correlated as increasing interest rates have a positive effect on the fair value of the MSR component of IRLC fair value, but increase the pull-through rate for the loan principal and interest payment cash flow component, which has decreased in fair value. Changes in fair value of IRLCs are included in Net gains on loans held for sale at fair value in the Company’s consolidated statements of income.

Table of Contents Following is a quantitative summary of key unobservable inputs used in the valuation of IRLCs:



	****	June 30, 2025		****	December 31, 2024
Fair value (in thousands) (1)		$	142,153		$	33,565
Committed amount (in thousands)		$	10,998,207		$	7,801,677
Key inputs (2):
Pull-through rate:
Range			29.8% – 100%			29.8% – 100%
Weighted average			87.0%			88.2%
Mortgage servicing rights fair value expressed as:
Servicing fee multiple:
Range			1.0 – 8.6			1.0 – 8.6
Weighted average			5.3			5.4
Percentage of loan commitment amount:
Range			0.3% – 4.5%			0.3% – 4.6%
Weighted average			2.1%			2.4%
(1)	For purpose of this table, IRLC asset and liability positions are shown net.
---	---
(2)	Weighted average inputs are based on the committed amounts.
---	---

Hedging Derivatives

Fair values of derivative financial instruments actively traded on exchanges are categorized by the Company as “Level 1” fair value assets and liabilities; fair values of derivative financial instruments based on observable interest rates, volatilities and prices in the MBS or other markets are categorized by the Company as “Level 2” fair value assets and liabilities.

Changes in the fair values of hedging derivatives are included in Net gains on loans held for sale at fair value, or Net loan servicing fees – Mortgage servicing rights hedging results, as applicable, in the Company’s consolidated statements of income.

Mortgage Servicing Rights

MSRs are categorized as “Level 3” fair value assets. The Company uses a discounted cash flow approach to estimate the fair value of MSRs. The key inputs used in the estimation of the fair value of MSRs include the applicable prepayment rate (prepayment speed), pricing spread (a component of discount rate), and annual per-loan cost to service the underlying loans, all of which are unobservable. Significant changes to any of those inputs in isolation could result in a significant change in the MSR fair value measurement. Changes in these key inputs are not directly related. Changes in the fair value of MSRs are included in Net loan servicing fees—Change in fair value of mortgage servicing rights and mortgage servicing liabilities in the Company’s consolidated statements of income.

Table of Contents Following are the key inputs used in determining the fair value of MSRs received by the Company when it retains the obligation to service the mortgage loans it sells:


		Quarter ended June 30,					Six months ended June 30,
		2025		2024		****	2025		2024
		(Amount recognized and unpaid principal balance of underlying loans in thousands)
MSR and underlying loan characteristics:
Amount recognized		$	814,538	$	541,207		$	1,464,887	$	953,727
Unpaid principal balance		$	34,697,004	$	24,741,715		$	62,361,980	$	44,226,530
Weighted average servicing fee rate (in basis points)			43		43			43		44
Key inputs (1):
Annual total prepayment speed (2):
Range			6.7% – 15.5%		7.3% – 15.0%			6.6% – 15.5%		7.3% – 15.9%
Weighted average			8.6%		10.0%			8.7%		10.5%
Equivalent average life (in years):
Range			3.8 – 10.1		3.5 – 9.7			3.8 – 10.2		3.5 – 9.7
Weighted average			8.8		7.9			8.7		7.7
Pricing spread (3):
Range			4.9% – 12.6%		5.3% – 12.6%			4.9% – 12.6%		5.3% – 12.6%
Weighted average			5.5%		6.0%			5.5%		6.1%
Per-loan annual cost of servicing:
Range			$70 – $127		$70 – $127			$70 – $127		$70 – $127
Weighted average			$100		$98			$100		$98
(1)	Weighted average inputs are based on the UPB of the underlying loans.
---	---
(2)	Annual total prepayment speed is measured using life total CPR, which includes both voluntary and involuntary prepayments. Equivalent average life is provided as supplementary information.
---	---
(3)	Pricing spread represents a margin that is applied to a reference interest rate’s forward rate curve to develop periodic discount rates. The Company applies a pricing spread to a derived United State Treasury Securities (“Treasury”) yield curve for purposes of discounting cash flows relating to MSRs.
---	---

Table of Contents Following is a quantitative summary of key inputs used in the valuation of the Company’s MSRs and the effect on the fair value from adverse changes in those inputs:


		June 30, 2025	December 31, 2024
		(Fair value, unpaid principal balance of underlying
		loans and effect on fair value amounts in thousands)
Fair value		$ 9,531,249	$ 8,744,528
Underlying loan characteristics:
Unpaid principal balance		$ 463,132,127	$ 426,055,220
Weighted average note interest rate		4.7%	4.5%
Weighted average servicing fee rate (in basis points)		39	38
Key inputs (1):
Annual total prepayment speed (2):
Range		6.2% – 19.0%	5.9% – 17.7%
Weighted average		8.9%	7.8%
Equivalent average life (in years):
Range		2.6 – 8.8	2.7 – 9.1
Weighted average		8.1	8.4
Effect on fair value of (3):
5% adverse change		($155,827)	($126,224)
10% adverse change		($306,286)	($248,349)
20% adverse change		($592,174)	($481,100)
Pricing spread (4):
Range		4.9% – 11.4%	5.0% – 11.3%
Weighted average		6.0%	6.2%
Effect on fair value of (3):
5% adverse change		($121,678)	($113,419)
10% adverse change		($240,330)	($223,960)
20% adverse change		($468,962)	($436,805)
Per-loan annual cost of servicing:
Range		$68 – $127	$68 – $130
Weighted average		$105	$105
Effect on fair value of (3):
5% adverse change		($51,524)	($48,830)
10% adverse change		($103,048)	($97,661)
20% adverse change		($206,097)	($195,321)
(1)	Weighted average inputs are based on the UPB of the underlying loans.
---	---
(2)	Annual total prepayment speed is measured using life total CPR, which includes both voluntary and involuntary prepayments. Equivalent average life is provided as supplementary information.
---	---
(3)	These sensitivity analyses are limited in that they were performed as of a particular date; only contemplate the movements in the indicated inputs; do not incorporate changes to other inputs; are subject to the accuracy of the models and inputs used; and do not incorporate other factors that would affect the Company’s overall financial performance in such events, including operational adjustments made to account for changing circumstances. For these reasons, these analyses should not be viewed as earnings forecasts.
---	---
(4)	The Company applies a pricing spread to a derived Treasury yield curve for purposes of discounting cash flows relating to MSRs.
---	---

Table of Contents Mortgage Servicing Liabilities

MSLs are categorized as “Level 3” fair value liabilities. The Company uses a discounted cash flow approach to estimate the fair value of MSLs. The key inputs used in the estimation of the fair value of MSLs include the applicable annual total prepayment speed, pricing spread, and the per-loan annual cost of servicing the underlying loans. Changes in the fair value of MSLs are included in Net servicing fees—Change in fair value of mortgage servicing rights and mortgage servicing liabilities in the Company’s consolidated statements of income.

Following are the key inputs used in estimating the fair value of MSLs:


			June 30,		December 31,
			2025		2024
Fair value (in thousands)		$	1,643	$	1,683
Underlying loan characteristics:
Unpaid principal balance of underlying loans (in thousands)		$	18,177	$	19,528
Servicing fee rate (in basis points)			25		25
Key inputs (1):
Annual total prepayment speed (2)^^			15.4%		15.7%
Equivalent average life (in years)			5.2		5.1
Pricing spread (3)			8.8%		8.6%
Per-loan annual cost of servicing		$	920	$	969
(1)	Weighted average inputs are based on UPB of the underlying mortgage loans.
---	---
(2)	Annual total prepayment speed is measured using life total CPR, which includes both voluntary and involuntary prepayments. Equivalent average life is provided as supplementary information.
---	---
(3)	The Company applies a pricing spread to a derived Treasury yield curve for purposes of discounting cash flows relating to MSLs.
---	---

Note 8— Principal-Only Stripped Mortgage-Backed Securities

Following is a summary of activity in the Company’s investment in principal-only stripped MBS:


	Quarter ended June 30,				Six months ended June 30,
	2025		2024		2025		2024
	(in thousands)
Balance at beginning of period	$	817,596	$	524,576	$	825,865	$	—
Purchases		—		410,617		—		935,356
Repayments		(46,529)		(13,336)		(84,267)		(13,452)
Changes in fair value included in income arising from:
Accrual of purchase discounts		6,699		8,826		18,034		9,090
Valuation adjustments		7,192		(16,460)		25,326		(16,771)
		13,891		(7,634)		43,360		(7,681)
Balance at end of period	$	784,958	$	914,223	$	784,958	$	914,223

Table of Contents Following is a summary of the Company’s investment in principal-only stripped MBS:


	June 30,		December 31,
	2025		2024
	(in thousands)
Principal balance	$	977,216	$	1,061,484
Unearned discounts		(179,383)		(197,418)
Cumulative valuation changes		(12,875)		(38,201)
Fair value	$	784,958	$	825,865
Fair value of principal-only stripped mortgage-backed securities pledged to secure Assets sold under agreements to repurchase	$	784,958	$	825,865

All of the Company’s principal-only stripped MBS have remaining contractual maturities of over ten years.

Note 9—Loans Held for Sale at Fair Value

Following is a summary of loans held for sale at fair value:


		June 30,			December 31,
Mortgage type	****	2025		****	2024
		(in thousands)
Government-insured or guaranteed		$	3,786,855		$	4,154,069
Conventional conforming			2,215,601			3,127,082
Jumbo			447,855			502,264
Closed-end second lien			268,600			272,285
Purchased from Ginnie Mae securities serviced by the Company			220,973			145,026
Repurchased pursuant to representations and warranties			21,340			16,742
		$	6,961,224		$	8,217,468
Fair value of loans pledged to secure:
Assets sold under agreements to repurchase		$	6,128,283		$	7,612,832
Mortgage loan participation purchase and sale agreements			745,063			528,002
		$	6,873,346		$	8,140,834

Note 10—Derivative Financial Instruments

The Company holds and issues derivative financial instruments in connection with its operating and investing activities. Derivative financial instruments are created in the Company’s loan production activities and when the Company enters into derivative transactions as part of its interest rate risk management activities. Derivative financial instruments created in the Company’s operating activities are IRLCs that are created when the Company commits to purchase or originate a loan for sale.

The Company engages in interest rate risk management activities in an effort to moderate the effect of changes in market interest rates on the fair value of certain of its assets. To manage this fair value risk resulting from interest rate risk, the Company uses derivative financial instruments acquired with the intention of reducing the risk that changes in market interest rates will result in unfavorable changes in the fair value of the Company’s IRLCs, inventory of loans held for sale and its MSRs.

The Company does not designate and qualify any of its derivatives for hedge accounting. The Company records all derivative financial instruments at fair value and records changes in fair value in current period income.

The Company has elected to present net derivative asset and liability positions, and cash collateral obtained from or posted to its counterparties when subject to a master netting arrangement that is legally enforceable on all counterparties in the event of default. The derivatives that are not subject to a master netting arrangement are IRLCs.

Table of Contents Derivative Notional Amounts and Fair Value of Derivatives

The Company had the following derivative financial instruments recorded on its consolidated balance sheets:


		June 30, 2025								December 31, 2024
				Fair value								Fair value
		Notional		Derivative			Derivative			Notional		Derivative			Derivative
Derivative instrument	****	amount (1)	****	assets		****	liabilities		****	amount (1)	****	assets		****	liabilities
		(in thousands)
Not subject to master netting arrangements:
Interest rate lock commitments		10,998,207		$	143,061		$	908		7,801,677		$	56,946		$	23,381
Subject to master netting arrangements (2):
Forward purchase contracts		13,037,927			89,834			174		12,760,764			3,701			66,646
Forward sales contracts		22,218,056			2,939			159,266		23,440,334			152,526			12,854
MBS put options		500,000			—			—		450,000			3,278			—
Put options on interest rate futures purchase contracts		7,000,000			996			—		4,270,000			12,592			—
Call options on interest rate futures purchase contracts		11,525,000			33,688			—		7,600,000			3,250			—
Call options on interest rate futures sale contracts		2,800,000			—			10,063		—			—			—
Treasury futures purchase contracts		5,998,000			—			—		7,467,000			—			—
Treasury futures sale contracts		7,347,000			—			—		10,521,000			—			—
Total derivatives before netting					270,518			170,411					232,293			102,881
Netting					(89,876)			(137,908)					(119,217)			(61,981)
				$	180,642		$	32,503				$	113,076		$	40,900
Forward sale contract with PennyMac Mortgage Investment Trust		84,070		$	—		$	1,038		—		$	—		$	—
Deposits placed with (received from) derivative counterparties included in the derivative balances above, net				$	48,032							$	(57,236)
(1)	Notional amounts provide an indication of the volume of the Company’s derivative activity.
---	---
(2)	All derivatives subject to master netting agreements are interest rate derivatives that are used as economic hedges.
---	---

Table of Contents Derivative Assets, Financial Instruments, and Cash Collateral Held by Counterparty

The following table summarizes by significant counterparty the amount of derivative asset positions after considering master netting arrangements and financial instruments or cash pledged that do not meet the accounting guidance to qualify for setoff accounting.


		June 30, 2025												December 31, 2024
					Gross amount not												Gross amount not
					offset in the												offset in the
					consolidated												consolidated
		Net amount			balance sheet									Net amount			balance sheet
		of assets in the						Cash						of assets in the						Cash
		consolidated			Financial			collateral			Net			consolidated			Financial			collateral			Net
Counterparty	****	balance sheet		****	instruments		****	received		****	amount		****	balance sheet		****	instruments		****	received		****	amount
		(in thousands)
Interest rate lock commitments		$	143,061		$	—		$	—		$	143,061		$	56,946		$	—		$	—		$	56,946
RJ O' Brien			24,621			—			—			24,621			15,842			—			—			15,842
Morgan Stanley Bank, N.A.			4,597			—			—			4,597			15,260			—			—			15,260
Mizuho Bank, Ltd.			2,108			—			—			2,108			1,683			—			—			1,683
South Street Securities			1,803			—			—			1,803			—			—			—			—
Bank of America, N.A.			—			—			—			—			8,221			—			—			8,221
Bank of Montreal			—			—			—			—			3,781			—			—			3,781
Athene Annuity & Life Assurance Company			—			—			—			—			2,352			—			—			2,352
BNP Paribas			—			—			—			—			2,260			—			—			2,260
Others			4,452			—			—			4,452			6,731			—			—			6,731
		$	180,642		$	—		$	—		$	180,642		$	113,076		$	—		$	—		$	113,076

Table of Contents Derivative Liabilities, Financial Instruments and Collateral Held by Counterparty

The following table summarizes by significant counterparty the amount of derivative liabilities and assets sold under agreements to repurchase after considering master netting arrangements and financial instruments or cash pledged that do not meet the accounting guidance to qualify for setoff accounting. All assets sold under agreements to repurchase are secured by sufficient collateral with fair values that exceed the liability amounts recorded on the consolidated balance sheets.


		June 30, 2025												December 31, 2024
					Gross amounts												Gross amounts
					not offset in the												not offset in the
		Net amount			consolidated									Net amount			consolidated
		of liabilities			balance sheet									of liabilities			balance sheet
		in the						Cash						in the						Cash
		consolidated			Financial			collateral			Net			consolidated			Financial			collateral			Net
Counterparty	****	balance sheet		****	instruments (1)		****	pledged		****	amount		****	balance sheet		****	instruments (1)		****	pledged		****	amount
		(in thousands)
Interest rate lock commitments		$	908		$	—		$	—		$	908		$	23,381		$	—		$	—		$	23,381
Atlas Securitized Products, L.P.			2,339,762			(2,339,762)			—			—			1,938,756			(1,938,756)			—			—
Bank of America, N.A.			1,275,935			(1,262,608)			—			13,327			1,294,213			(1,294,213)			—			—
JPMorgan Chase Bank, N.A.			808,309			(808,175)			—			134			1,220,822			(1,214,559)			—			6,263
Royal Bank of Canada			633,971			(633,971)			—			—			785,597			(785,597)			—			—
Wells Fargo Bank, N.A.			542,679			(541,545)			—			1,134			795,119			(789,305)			—			5,814
Citibank, N.A.			470,812			(470,812)			—			—			455,426			(455,426)			—			—
BNP Paribas			346,078			(345,257)			—			821			568,790			(568,790)			—			—
Morgan Stanley Bank, N.A.			320,702			(320,396)			—			306			472,659			(472,659)			—			—
Santander US Capital Markets LLC			245,158			(240,555)			—			4,603			282,077			(282,077)			—			—
Nomura Corporate Funding Americas			134,739			(134,739)			—			—			175,000			(175,000)			—			—
Goldman Sachs			98,732			(97,950)			—			782			336,894			(336,624)			—			270
Barclays Capital			80,650			(80,434)			—			216			258,559			(254,750)			—			3,809
Mizuho Bank, Ltd.			75,642			(75,642)			—			—			125,000			(125,000)			—			—
Federal National Mortgage Association			1,904			—			—			1,904			—			—			—			—
PennyMac Mortgage Investment Trust			1,038			—			—			1,038			—			—			—			—
Others			8,368			—			—			8,368			1,363			—			—			1,363
		$	7,385,387		$	(7,351,846)		$	—		$	33,541		$	8,733,656		$	(8,692,756)		$	—		$	40,900
(1)	Amounts represent the UPB of Assets sold under agreements to repurchase.
---	---

Following are the gains (losses) recognized by the Company on derivative financial instruments and the consolidated statement of income lines where such gains and losses are included:


				Quarter ended June 30,						Six months ended June 30,
Derivative activity	****	Consolidated statement of income line	****	2025		****	2024		****	2025		****	2024
				(in thousands)
Interest rate lock commitments		Net gains on loans held for sale at fair value (1)		$	32,211		$	(1,055)		$	108,588		$	(20,841)
Hedged item:
Interest rate lock commitments and loans held for sale		Net gains on loans held for sale at fair value		$	(28,853)		$	52,955		$	(173,899)		$	105,192
Mortgage servicing rights		Net loan servicing fees–Mortgage servicing rights hedging results		$	(116,294)		$	(155,317)		$	(27,654)		$	(449,651)
(1)	Represents net change in fair value of IRLCs from the beginning to the end of the period. Amounts recognized at the date of commitment and fair value changes recognized during the period until purchase of the underlying loans or the cancellation of the commitment are shown in the rollforward of IRLCs for the quarter in Note 7 – Fair Value – Assets and Liabilities Measured at Fair Value on a Recurring Basis .
---	---

Table of Contents Note 11—Mortgage Servicing Rights and Mortgage Servicing Liabilities

Mortgage Servicing Rights at Fair Value

The activity in MSRs is as follows:


		Quarter ended June 30,						Six months ended June 30,
		2025		****	2024		****	2025		****	2024
		(in thousands)
Balance at beginning of period		$	8,963,889		$	7,483,210		$	8,744,528		$	7,099,348
MSRs resulting from loan sales			814,538			541,207			1,464,887			953,727
Change in fair value due to:
Changes in inputs used in valuation model (1)			15,950			99,440			(189,539)			269,392
Other changes in fair value (2)^^			(263,128)			(200,779)			(488,627)			(399,389)
Total change in fair value			(247,178)			(101,339)			(678,166)			(129,997)
Balance at end of period		$	9,531,249		$	7,923,078		$	9,531,249		$	7,923,078
Unpaid principal balance of underlying loans at end of period								$	463,132,127		$	396,429,820

								June 30,			December 31,
								2025			2024
								(in thousands)
Fair value of mortgage servicing rights pledged to secure Assets sold under agreements to repurchase and Notes payable secured by mortgage servicing assets								$	9,350,647		$	8,609,388
(1)	Principally reflects changes in annual total prepayment speed, pricing spread, per loan annual cost of servicing and UPB of underlying loan inputs.
---	---
(2)	Represents changes due to realization of cash flows.
---	---

Mortgage Servicing Liabilities at Fair Value

The activity in MSLs is summarized below:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Balance at beginning of period		$	1,651		$	1,732		$	1,683		$	1,805
Changes in fair value due to:
Changes in inputs used in valuation model (1)			21			15			26			(12)
Other changes in fair value (2)^^			(29)			(39)			(66)			(85)
Total change in fair value			(8)			(24)			(40)			(97)
Balance at end of period		$	1,643		$	1,708		$	1,643		$	1,708
Unpaid principal balance of underlying loans at end of period								$	18,177		$	21,197

(1)	Principally reflects changes in annual total prepayment speed, pricing spread and per loan annual cost of servicing.

(2)	Represents changes due to realization of cash flows.

Table of Contents Contractual servicing fees relating to MSRs and MSLs are recorded in Net loan servicing fees—Loan servicing fees—From non-affiliates on the Company’s consolidated statements of income; other fees relating to MSRs and MSLs are recorded in Net loan servicing fees—Loan servicing fees—Other on the Company’s consolidated statements of income. Such amounts are summarized below:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Contractual servicing fees		$	435,517		$	375,040		$	853,204		$	733,066
Other fees:
Late charges			19,855			17,248			39,906			34,857
Other			4,060			3,149			7,539			5,789
		$	459,432		$	395,437		$	900,649		$	773,712

Note 12—Other Assets

Other assets are summarized below:


		June 30,			December 31,
	2025		****	2024
	(in thousands)
Margin deposits	$	264,992		$	288,153
Capitalized software, net		112,291			120,802
Servicing fees receivable, net		45,357			38,676
Other servicing receivables		47,842			54,058
Interest receivable		41,355			41,286
Prepaid expenses		39,784			45,762
Real estate acquired in settlement of loans		31,223			14,976
Operating lease right-of-use assets		30,745			36,572
Deposits securing Assets sold under agreements to repurchase and <br>Notes payable secured by mortgage servicing assets		13,124			16,697
Furniture, fixtures, equipment and building improvements, net		10,758			12,916
Other		77,206			100,183
	$	714,677		$	770,081
Deposits securing Assets sold under agreements to repurchase or Notes payable secured by mortgage servicing assets	$	13,124		$	16,697

Table of Contents

Note 13—Leases

The Company has operating lease agreements relating to its facilities. The Company’s operating lease agreements have remaining terms ranging from less than one year to six years. Some of the operating lease agreements include options to extend the term for up to five years. None of the Company’s operating lease agreements require the Company to make variable lease payments.

The Company’s lease agreements are summarized below:



	Quarter ended June 30,						Six months ended June 30,
	2025		****	2024		****	2025		****	2024
	(dollars in thousands)
Lease expense:
Operating leases	$	4,033		$	4,004		$	8,035		$	8,035
Short-term leases		82			84			148			168
Sublease income		(378)			(317)			(755)			(742)
Net lease expense included in Occupancy and equipment expense	$	3,737		$	3,771		$	7,428		$	7,461

Other information:
Payments for operating leases	$	5,335		$	4,986		$	10,412		$	9,960
Operating lease right-of-use assets recognized	$	648		$	—		$	1,209		$	—
Period end weighted averages:
Remaining lease term (in years)								3.3			3.9
Discount rate								3.9%			4.0%

Lease payment obligations attributable to the Company’s operating lease liabilities are summarized below:


Twelve months ended June 30,	Operating leases
	(in thousands)
2026	$	17,736
2027		11,276
2028		5,180
2029		4,747
2030		3,385
Thereafter		1,428
Total lease payments		43,752
Less imputed interest		(3,664)
Operating lease liability included in Accounts payable and accrued expenses	$	40,088

Note 14—Short-Term Debt

The borrowing facilities described throughout these Notes 14 and 15 contain various covenants, including financial covenants governing the Company’s net worth, debt-to-equity ratio and liquidity. Management believes that the Company was in compliance with these covenants as of June 30, 2025.

Assets Sold Under Agreements to Repurchase

The Company has multiple borrowing facilities in the form of asset sales under agreements to repurchase. These borrowing facilities are secured by principal-only stripped MBS, loans held for sale, participation certificates backed by mortgage servicing assets or margin deposits. Eligible assets are sold at advance rates based on the fair value (as determined by the lender) of the assets sold. Interest is charged at a rate based on the Secured Overnight Financing Rate (“SOFR”). Principal-only stripped MBS, mortgage servicing assets, loans and participation certificates backed by mortgage servicing assets financed under these agreements may be re-pledged by the lenders.

Table of Contents Assets sold under agreements to repurchase are summarized below:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(dollars in thousands)
Average balance of assets sold under agreements to repurchase		$	7,183,987		$	5,761,107		$	6,649,802		$	4,651,823
Weighted average interest rate (1)			6.00%			7.06%			5.97%			7.13%
Total interest expense		$	112,685		$	106,587		$	206,914		$	177,022
Maximum daily amount outstanding		$	8,581,781		$	7,122,796		$	8,690,936		$	7,122,796
(1)	Excludes the effect of amortization of debt issuance costs and non-utilization fees of $5.1 million and $5.4 million for the quarters ended June 30, 2025 and 2024, respectively, and $9.9 million and $12.1 million for the six months ended June 30, 2025 and 2024, respectively.
---	---


		June 30,			December 31,
	****	2025		****	2024
		(dollars in thousands)
Carrying value:
Unpaid principal balance		$	7,351,846		$	8,692,756
Unamortized debt issuance costs			(7,592)			(7,549)
		$	7,344,254		$	8,685,207
Weighted average interest rate			5.94%			5.89%
Available borrowing capacity (1):
Committed		$	1,017,655		$	460,000
Uncommitted			3,918,218			3,104,026
		$	4,935,873		$	3,564,026
Assets securing repurchase agreements:
Principal-only stripped mortgage-backed securities		$	784,958		$	825,865
Loans held for sale		$	6,128,283		$	7,612,832
Servicing advances (2)		$	265,118		$	357,939
Mortgage servicing rights (2)		$	8,034,225		$	7,488,539
Deposits (2)		$	13,124		$	16,697
(1)	The amount the Company is able to borrow under asset repurchase agreements is tied to the fair value of unencumbered assets eligible to secure those agreements and the Company’s ability to fund the agreements’ margin requirements relating to the assets financed.
---	---
(2)	Beneficial interests in the Ginnie Mae MSRs, Fannie Mae MSRs, servicing advances and deposits together serve as the collateral backing servicing asset financing facilities that are included in Assets sold under agreements to repurchase and the term notes and term loans included in Notes payable secured by mortgage servicing assets. The term notes and term loans are described in Note 15–Long-Term Debt - Notes payable secured by mortgage servicing assets.
---	---

Table of Contents Maturities

Following is a summary of maturities of outstanding advances under asset repurchase agreements by maturity date:


Remaining maturity at June 30, 2025 (1)	****	Unpaid principal balance
		(dollars in thousands)
Within 30 days		$	1,464,684
Over 30 to 90 days			4,512,313
Over 90 to 180 days			58,042
Over 180 days to one year			1,198,227
Over one year to two years			118,580
Total assets sold under agreements to repurchase		$	7,351,846
Weighted average maturity (in months)			3.5
(1)	The Company is subject to margin calls during the periods the agreements are outstanding and therefore may be required to repay a portion of the borrowings before the respective agreements mature if the fair values (as determined by the applicable lender) of the assets securing those agreements decrease.
---	---

Amounts at Risk

The amount at risk (the fair value of the assets pledged plus the related margin deposit, less the amount advanced by the counterparty and interest payable) relating to the Company’s assets sold under agreements to repurchase is summarized by asset type and counterparty below as of June 30, 2025:

Loans held for sale and MSRs



					Weighted average
Counterparty	****	Amount at risk		****	maturity of advances	****	Facility maturity
		(in thousands)
Atlas Securitized Products, L.P., Goldman Sachs Bank USA, Nomura Corporate Funding Americas and Mizuho Bank, Ltd. (1)		$	6,174,715		June 18, 2026		June 18, 2026
Atlas Securitized Products, L.P.		$	158,877		November 19, 2025		June 26, 2026
Bank of America, N.A.		$	92,204		August 6, 2025		June 9, 2027
JP Morgan Chase Bank, N.A.		$	38,981		October 21, 2025		July 10, 2026
Royal Bank of Canada		$	33,779		July 30, 2025		May 8, 2026
Citibank, N.A.		$	29,756		September 4, 2025		June 11, 2026
Nomura Corporate Funding Americas		$	19,151		July 14, 2025		January 22, 2026
Morgan Stanley Bank, N.A.		$	18,275		September 10, 2025		May 22, 2026
Wells Fargo Bank, N.A.		$	15,359		September 14, 2025		June 11, 2027
Barclays Bank PLC		$	14,165		November 6, 2025		March 6, 2026
BNP Paribas		$	13,186		September 14, 2025		September 30, 2026
Mizuho Bank, Ltd.		$	8,733		February 19, 2026		March 14, 2026
Goldman Sachs Bank USA		$	2,222		September 5, 2025		February 13, 2027
(1)	The amount at risk includes the beneficial interests in Ginnie Mae MSRs, Fannie Mae MSRs and servicing advances pledged to serve as the collateral backing servicing asset facilities included in Assets sold under agreements to repurchase and the term notes and term loans included in Notes payable secured by mortgage servicing assets. The facilities mature on various dates through October 25, 2026 and the facility maturity date shown in this table represents a weighted average of those dates.
---	---

Table of Contents Principal-only stripped MBS


Counterparty	****	Amount at risk		****	Maturity
		(in thousands)
Bank of America, N.A.		$	2,846		July 25, 2025
JP Morgan Chase Bank, N.A.		$	22,094		July 7, 2025
Wells Fargo Bank, N.A.		$	17,963		July 23, 2025
Santander US Capital Markets LLC		$	15,227		July 15, 2025

Mortgage Loan Participation Purchase and Sale Agreements

Two of the borrowing facilities secured by loans held for sale are in the form of mortgage loan participation purchase and sale agreements. Participation certificates, each of which represents an undivided beneficial ownership interest in mortgage loans that have been pooled with Fannie Mae, Freddie Mac or Ginnie Mae, are sold to a lender pending securitization of the mortgage loans and sale of the resulting securities. A commitment to sell the securities resulting from the pending securitization between the Company and a non-affiliate is also assigned to the lender at the time a participation certificate is sold.

The purchase price paid by the lender for each participation certificate is based on the trade price of the security, plus an amount of interest expected to accrue on the security to its anticipated delivery date, minus a present value adjustment, any related hedging costs, and a holdback amount, that is based on a percentage of the purchase price. The holdback amount is not required to be paid to the Company until the settlement of the security and its delivery to the lender.

The mortgage loan participation purchase and sale agreements are summarized below:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(dollars in thousands)
Average balance		$	283,853		$	236,647		$	272,512		$	235,761
Weighted average interest rate (1)			5.65%			6.69%			5.64%			6.69%
Total interest expense		$	4,168		$	4,109		$	7,972		$	8,186
Maximum daily amount outstanding		$	701,233		$	512,528		$	701,233		$	515,990
(1)	Excludes the effect of amortization of debt issuance costs totaling $172,000 and $176,000 for the quarters ended June 30, 2025 and 2024, respectively and $344,000 and $348,000 for the six months ended June 30, 2025 and 2024, respectively.
---	---


	****	June 30,			December 31,
		2025		****	2024
		(dollars in thousands)
Carrying value:
Unpaid principal balance		$	701,233		$	496,856
Unamortized debt issuance costs			(937)			(344)
		$	700,296		$	496,512
Weighted average interest rate			5.58%			5.58%
Fair value of loans pledged to secure mortgage loan participation purchase and sale agreements		$	745,063		$	528,002

Table of Contents Note 15—Long-Term Debt

Notes Payable Secured by Mortgage Servicing Assets

Term Notes and Term Loans

The Company, through its wholly-owned subsidiaries PNMAC, PLS and the PNMAC GMSR ISSUER TRUST (“Issuer Trust”) has entered into a structured finance transaction, in which PLS pledges and/or sells to the Issuer Trust participation certificates representing beneficial interests in Ginnie Mae mortgage servicing assets pursuant to a repurchase agreement. The Issuer Trust has issued VFNs to PLS, has issued secured term notes (the “Term Notes”) to qualified institutional buyers under Rule 144A of the Securities Act of 1933, as amended (the “Securities Act”), and has entered into a series of syndicated term loans with various lenders (the “Term Loans”). The Term Notes and Term Loans are secured by the participation certificates relating to Ginnie Mae mortgage servicing assets financed pursuant to the servicing asset repurchase facilities, and rank pari passu with the mortgage servicing asset VFNs.

Following is a summary of the issued and outstanding Term Notes and Term Loans:


							Maturity date
Issuance date	****	Principal balance		****	Annual interest rate spread (1)	****	Stated	****	Optional extension (2)
		(in thousands)
Term Notes:
February 29, 2024		$	425,000		3.20%		March 26, 2029		March 25, 2031
Term Loans:
February 28, 2023			680,000		3.00%		February 25, 2028		February 25, 2029
October 25, 2023			125,000		3.00%		October 25, 2028
		$	1,230,000
(1)	Interest is charged at a rate of SOFR plus a spread.
---	---
(2)	The Term Notes and Term Loans’ indentures provide the Company with the option to extend the maturity of certain of the Term Notes or Term Loans as specified in the respective agreements.
---	---

Freddie Mac MSR Notes Payable

The Company has notes payable facilities with two lenders that are secured by Freddie Mac MSRs. Interest is charged at a rate of SOFR plus a spread as defined in the agreements. The facilities expire on March 6 and June 11, 2026. The maximum amount that the Company may borrow under the notes payable is $900 million, $850 million of which is committed, and may be reduced by other debt outstanding with the counterparties.

Notes payable secured by mortgage servicing assets are summarized below:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(dollars in thousands)
Average balance		$	1,698,132		$	1,872,857		$	1,780,415		$	1,911,593
Weighted average interest rate (1)			7.81%			8.85%			7.83%			8.89%
Total interest expense		$	35,743		$	41,932		$	72,321		$	85,938
(1)	Excludes the effect of amortization of debt issuance costs totaling $2.7 million and $726,000 for the quarters ended June 30, 2025 and 2024, respectively, and $3.2 million and $1.5 million for the six months ended June 30, 2025 and 2024, respectively.
---	---

Table of Contents

		June 30,		December 31,
		2025		2024
		(dollars in thousands)
Carrying value:
Unpaid principal balance:
Term Notes and Term Loans		$	1,230,000	$	1,730,000
Freddie Mac MSR Notes Payable			100,000		325,000
			1,330,000		2,055,000
Unamortized debt issuance costs			(2,857)		(6,028)
		$	1,327,143	$	2,048,972
Weighted average interest rate			7.49%		7.81%
Assets pledged to secure notes payable (1):
Servicing advances		$	265,118	$	357,939
Mortgage servicing rights		$	9,350,647	$	8,609,388
Deposits		$	13,124	$	16,697
(1)	Beneficial interests in the Ginnie Mae MSRs, Fannie Mae MSRs, servicing advances and deposits together serve as the collateral backing servicing asset facilities that include Assets sold under agreements to repurchase and the Term Notes and Term Loans included in Notes payable secured by mortgage servicing assets.
---	---

Unsecured Senior Notes

The Company has issued unsecured senior notes (the “Unsecured Notes”) to qualified institutional buyers under Rule 144A of the Securities Act. The Unsecured Notes are senior unsecured obligations of the Company and will rank senior in right of payment to any future subordinate indebtedness of the Company, equally in right of payment with all existing and future senior indebtedness of the Company and effectively subordinate to any existing and future secured indebtedness of the Company to the extent of the fair value of collateral securing such indebtedness.

The Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by the Company’s existing and future wholly-owned domestic subsidiaries (other than certain excluded subsidiaries defined in the indenture under which the Unsecured Notes were issued). The guarantees are senior unsecured obligations of the guarantors and will rank senior in right of payment to any future subordinate indebtedness of the guarantors, equally in right of payment with all existing and future senior indebtedness of the guarantors and effectively subordinate to any existing and future secured indebtedness of the guarantors to the extent of the fair value of collateral securing such indebtedness. The Unsecured Notes and the guarantees are structurally subordinate to the indebtedness and liabilities of the Company’s subsidiaries that do not guarantee the Unsecured Notes.

Following is a summary of the Company’s outstanding Unsecured Notes:


Issuance date		Principal balance		Note interest rate	Maturity date	Optional redemption date (1)
		(in thousands)		(annual)
February 11, 2021		$	650,000	4.25%	February 15, 2029	February 15, 2024
September 16, 2021			500,000	5.75%	September 15, 2031	September 15, 2026
December 11, 2023			750,000	7.875%	December 15, 2029	December 15, 2026
May 23, 2024			650,000	7.125%	November 15, 2030	November 15, 2026
February 6, 2025			850,000	6.875%	February 15, 2033	February 15, 2028
May 1, 2025			850,000	6.875%	May 15, 2032	May 15, 2028
		$	4,250,000
(1)	Before the optional redemption date, the Company may redeem some or all of the Unsecured Notes for that issuance at a price equal to 100% of the principal amount, plus accrued and unpaid interest and a make-whole premium or the Company may redeem up to 40% of the Unsecured Notes for that issuance with an amount equal to or less than the net proceeds from certain equity offerings at the redemption price set forth in the indenture, plus accrued and unpaid interest. On or after the optional redemption date, the Company may redeem some or all of the Unsecured Notes for that issuance at the redemption prices set forth in the indenture, plus accrued interest.
---	---

Table of Contents


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(dollars in thousands)
Average balance		$	4,197,253		$	2,828,571		$	3,954,973		$	2,689,286
Weighted average interest rate (1)			6.41%			6.03%			6.34%			5.97%
Total interest expense		$	70,157		$	43,968		$	130,294		$	82,800
(1)	Excludes the effect of amortization of debt issuance costs of $2.9 million and $1.5 million for the quarters ended June 30, 2025 and 2024, respectively, and $4.9 million and $2.9 million for the six months ended June 30, 2025 and 2024, respectively.
---	---


	June 30,		December 31,
	2025		2024
	(dollars in thousands)
Carrying value:
Unpaid principal balance	$	4,250,000	$	3,200,000
Unamortized debt issuance costs and premiums, net		(64,988)		(35,968)
	$	4,185,012	$	3,164,032
Weighted average interest rate		6.56%		6.15%

Maturities of Long-Term Debt

Maturities of long-term debt (based on stated maturity dates) are as follows:


		Twelve months ended June 30,
	****	2026		****	2027		****	2028		****	2029		****	2030		****	Thereafter		****	Total
		(in thousands)
Notes payable secured by mortgage servicing assets (1)		$	100,000		$	—		$	680,000		$	550,000		$	—		$	—		$	1,330,000
Unsecured senior notes			—			—			—			650,000			750,000			2,850,000			4,250,000
Total		$	100,000		$	—		$	680,000		$	1,200,000		$	750,000		$	2,850,000		$	5,580,000
(1)	The Term Notes and Term Loans’ indentures provide the Company with the option to extend the maturity of the Term Notes and Term Loans as specified in the respective agreements.
---	---

Note 16—Liability for Losses Under Representations and Warranties

Following is a summary of the Company’s liability for losses under representations and warranties:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Balance at beginning of period		$	30,774		$	29,976		$	29,129		$	30,788
Provision for losses:
Resulting from sales of loans			4,054			4,129			7,601			8,081
Resulting from change in estimate			(2,220)			(4,076)			(3,635)			(7,396)
Losses incurred			(845)			(1,341)			(1,332)			(2,785)
Balance at end of period		$	31,763		$	28,688		$	31,763		$	28,688
Unpaid principal balance of loans subject to <br>representations and warranties at end of period								$	452,998,620		$	381,524,553

Table of Contents Note 17—Income Taxes

The Company’s effective income tax rates were (78.5)% and 26.6% for the quarters ended June 30, 2025 and 2024, respectively, and (17.8)% and 22.6% for the six months ended June 30, 2025 and 2024, respectively. The decreases in the effective income tax rates for the quarter and six months ended June 30, 2025 compared to the same periods in 2024 are primarily due to a non-recurring $81.6 million net income tax benefit primarily due to the repricing of deferred tax liabilities resulting from changes to California's apportionment rules with the enactment of California Senate Bill 132, signed into law June 27, 2025 and effective January 1, 2025. The law requires financial institutions to apportion their California income using a single sales factor instead of a factor equally weighted with property, payroll and sales.

Note 18—Commitments and Contingencies

Commitments to Purchase and Fund Mortgage Loans

The Company’s commitments to purchase and fund loans totaled $11.0 billion as of June 30, 2025.

Legal and Regulatory Proceedings

From time to time, the Company may be a party to legal and regulatory proceedings, lawsuits and other claims arising in the ordinary course of its business. The amount, if any, of ultimate liability with respect to such matters cannot be determined, but despite the inherent uncertainties of litigation, management believes that the ultimate disposition of any such proceedings and exposure will not have, individually or taken together, a material adverse effect on the financial condition, income, or cash flows of the Company.

Note 19—Stockholders’ Equity

The Company’s stock repurchase program provides for the repurchase of up to $2 billion of its common stock, before transaction costs and excise tax. From inception through June 30, 2025, the Company repurchased $1.8 billion of common stock, including $537,000 in transaction fees. No common stock was repurchased during the quarter and six months ended June 30, 2025 and 2024.

Table of Contents Note 20—Net Gains on Loans Held for Sale

Net gains on loans held for sale at fair value are summarized below:


		Quarter ended June 30,					Six months ended June 30,
		2025		2024		****	2025		****	2024
		(in thousands)
From non-affiliates:
Cash losses:
Loans		$	(573,210)	$	(413,822)		$	(849,520)		$	(723,012)
Hedging activities			(105,772)		92,552			(416,471)			242,771
			(678,982)		(321,270)			(1,265,991)			(480,241)
Non-cash gains:
Mortgage servicing rights resulting from loan sales			814,538		541,207			1,464,887			953,727
Provisions for losses relating to representations and warranties:
Pursuant to loan sales			(4,054)		(4,129)			(7,601)			(8,081)
Reductions in liability due to changes in estimate			2,220		4,076			3,635			7,396
Changes in fair values of loans and derivatives held at end of period:
Interest rate lock commitments			32,211		(1,055)			108,588			(20,841)
Loans			(15,268)		(2,695)			(102,307)			24,950
Hedging derivatives			76,919		(39,597)			242,572			(137,579)
			227,584		176,537			443,783			339,331
From PennyMac Mortgage Investment Trust (1)			7,075		(473)			11,913			(826)
		$	234,659	$	176,064		$	455,696		$	338,505
(1)	The terms of loan sales to PMT are described in Note 5–Related Party Transactions–PennyMac Mortgage Investment Trust–Operating Activities.
---	---

Note 21—Net Interest Expense

Net interest expense is summarized below:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Interest income:
Cash and short-term investments		$	10,919		$	13,172		$	20,926		$	27,754
Principal-only stripped mortgage-backed securities			6,948			9,074			18,543			9,344
Loans held for sale			105,725			86,283			193,119			151,704
Placement fees relating to custodial funds			97,975			92,230			177,770			168,363
Other			362			52			1,442			72
			221,929			200,811			411,800			357,237
Interest expense:
Assets sold under agreements to repurchase			112,685			106,587			206,914			177,022
Mortgage loan participation purchase and sale agreements			4,168			4,109			7,972			8,186
Notes payable secured by mortgage servicing assets			35,743			41,932			72,321			85,938
Unsecured senior notes			70,157			43,968			130,294			82,800
Interest shortfall on repayments of mortgage loans serviced for Agency securitizations			14,058			7,902			23,832			14,023
Interest on mortgage loan impound deposits			2,263			2,962			4,844			4,949
Other			503			411			1,482			722
			239,577			207,871			447,659			373,640
		$	(17,648)		$	(7,060)		$	(35,859)		$	(16,403)

Table of Contents Note 22—Stock-based Compensation

Following is a summary of the stock-based compensation activity:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Grants:
Units:
Performance-based restricted share units ("RSUs")			—			—			185			246
Stock options			—			—			187			188
Time-based RSUs			—			2			260			147
Grant date fair value:
Performance-based RSUs		$	—		$	—		$	18,788		$	20,915
Stock options			—			—			8,138			6,935
Time-based RSUs			—			145			26,484			12,478
Total		$	—		$	145		$	53,410		$	40,328
Vesting and exercise:
Performance-based RSUs vested			—			—			—			309
Stock options exercised			12			96			138			427
Time-based RSUs vested			2			2			187			211
Stock-based compensation expense		$	7,518		$	(2,212)		$	18,602		$	2,371

Note 23—Disaggregation of Certain Expense Captions

Following are the disaggregation of certain expense captions:


		Quarter ended June 30,						Six months ended June 30,
Expense line	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Technology
Amortization of capitalized software		$	12,813		$	12,242		$	24,794		$	24,423
Other (1)			29,444			23,448			57,660			47,234
Total technology expense		$	42,257		$	35,690		$	82,454		$	71,657

Occupancy and equipment
Depreciation		$	1,918		$	1,998		$	3,833		$	3,981
Operating lease cost			3,655			3,687			7,280			7,293
Short-term lease cost			82			84			148			168
Other (2)			2,724			2,124			5,500			5,127
Total occupancy and equipment expense		$	8,379		$	7,893		$	16,761		$	16,569
(1)	Other technology expenses primarily consist of software licensing and maintenance and data center expenses.
---	---

(2)	Other occupancy and equipment expenses primarily consist of common area maintenance charges, repair and security expenses.

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Note 24—Earnings Per Share

Basic earnings per share is determined by dividing net income by the weighted average number of shares of common stock outstanding during the quarter. Diluted earnings per share is determined by dividing net income by the weighted average number of shares of common stock outstanding, assuming all dilutive securities were issued.

The Company’s potentially dilutive securities are stock-based compensation awards. The Company applies the treasury stock method to determine the diluted weighted average number of shares of common stock outstanding based on the outstanding stock-based compensation awards.

The following table summarizes the basic and diluted earnings per share calculations:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands, except per share amounts)
Net income		$	136,463		$	98,258		$	212,743		$	137,566

Weighted average shares of common stock outstanding			51,667			50,955			51,587			50,751
Effect of dilutive securities - shares issuable under stock-based compensation plan			1,968			2,249			2,039			2,389
Weighted average diluted shares of common stock outstanding			53,635			53,204			53,626			53,140
Basic earnings per share		$	2.64		$	1.93		$	4.12		$	2.71
Diluted earnings per share		$	2.54		$	1.85		$	3.97		$	2.59

Calculations of diluted earnings per share require certain potentially dilutive shares to be excluded when their inclusion in the diluted earnings per share calculation would be anti-dilutive. The following table summarizes the weighted-average number of anti-dilutive outstanding RSUs and stock options excluded from the calculation of diluted earnings per share:



		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands except for weighted average exercise price)
Performance-based RSUs (1)			411			827			368			754
Time-based RSUs			—			1			190			98
Stock options (2)			237			187			191			126
Total anti-dilutive units and options			648			1,015			749			978
Weighted average exercise price of anti-dilutive stock options (2)		$	98.21		$	84.93		$	97.36		$	84.93
(1)	Certain performance-based RSUs were outstanding but not included in the computation of earnings per share because the performance thresholds included in such RSUs have not been achieved.
---	---
(2)	Certain stock options were outstanding but not included in the computation of diluted earnings per share because the combination of the weighted-average exercise prices and average unamortized stock compensation cost exceeded the average market price of the outstanding stock options for the period.
---	---

Table of Contents Note 25—Regulatory Capital and Liquidity Requirements

The Company, through PLS, is required to maintain specified levels of capital and liquidity to remain a seller/servicer in good standing with the Agencies. Such capital and liquidity requirements generally are tied to the size of the PLS’s loan servicing portfolio and loan origination volume.

The Agencies’ capital and liquidity levels and requirements, the calculations of which are specified by each Agency, are summarized below:


		June 30, 2025						December 31, 2024
Requirement/Agency	****	Actual (1)		****	Requirement (1)		****	Actual (1)		****	Requirement (1)		****
		(dollars in thousands)
Capital
Fannie Mae & Freddie Mac		$	7,711,113		$	1,485,109		$	7,457,748		$	1,380,100
Ginnie Mae		$	7,630,194		$	1,618,448		$	6,952,347		$	1,526,074
HUD		$	7,630,194		$	2,500		$	6,952,347		$	2,500
Risk-based capital
Ginnie Mae			40	%		6	%		40	%		6	%
Liquidity
Fannie Mae & Freddie Mac		$	839,203		$	676,887		$	870,243		$	630,698
Ginnie Mae		$	1,037,175		$	495,140		$	1,208,755		$	460,200
Adjusted net worth / Total assets ratio
Ginnie Mae			40	%		6	%		35	%		6	%
Tangible net worth / Total assets ratio
Fannie Mae & Freddie Mac			32	%		6	%		29	%		6	%
(1)	Calculated in accordance with the respective Agency’s requirements.
---	---

Noncompliance with an Agency’s requirements can result in such Agency taking various remedial actions up to and including terminating the Company’s ability to sell loans to and service loans on behalf of the respective Agency.

Note 26—Segments

The Company’s reportable segments are identified based on their unique business activities. The following disclosures about the Company’s business segments are presented consistent with the way the Company’s chief operating decision maker organizes and evaluates financial information for making operating decisions and assessing performance. The Company’s chief operating decision maker is its chief executive officer. The reportable segments are evaluated based on income or loss before provision for income taxes. The chief operating decision maker uses pre-tax segment results to assess segment performance and allocate operating and capital resources among the two reportable segments described below. The segments are separately evaluated because they represent different services.

During the year ended December 31, 2024, the Company adopted ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). Concurrent with the adoption of ASU 2023-07 management reassessed its segment definitions to those shown below. Prior period amounts have been recast to conform the prior quarter presentation to the current quarter presentation.

The Company conducts its business in two operating and reportable segments, “production” and “servicing”:

●	The production segment performs loan origination, acquisition and sale activities, including the fulfillment of correspondent production activities for PMT.

●	The servicing segment performs servicing of loans on behalf of non-affiliate investors, execution and management of early buyout transactions, and servicing of loans and MSRs sourced and managed for PMT.

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●	Non-segment activities are included under the heading “Corporate and other” and include amounts attributable to corporate activities that are not directly attributable to the production and servicing segments as well as investment management fees earned from PMT. None of the corporate and other items meet the quantitative threshold to be classified as a reportable segment.

Financial performance and results by segment are as follows:


		Quarter ended June 30, 2025
	****	Production		****	Servicing		****	Reportable segment total		****	Corporate and other		****	Consolidated total
		(in thousands)
Revenues: (1)
Net gains on loans held for sale at fair value		$	203,961		$	30,698		$	234,659		$	—		$	234,659
Loan origination fees			59,091			—			59,091			—			59,091
Fulfillment fees from PennyMac Mortgage Investment Trust			5,814			—			5,814			—			5,814
Net loan servicing fees			—			150,395			150,395			—			150,395
Management fees			—			—			—			6,869			6,869
Net interest income (expense):
Interest income			104,205			117,123			221,328			601			221,929
Interest expense			93,622			145,955			239,577			—			239,577
			10,583			(28,832)			(18,249)			601			(17,648)
Other			132			1,138			1,270			4,280			5,550
Total net revenues			279,581			153,399			432,980			11,750			444,730
Expenses:
Compensation			104,456			51,284			155,740			31,801			187,541
Loan origination			68,836			—			68,836			—			68,836
Technology			27,841			9,505			37,346			4,911			42,257
Servicing			—			28,286			28,286			—			28,286
Marketing and advertising			10,276			384			10,660			1,729			12,389
Professional services			3,545			1,798			5,343			3,037			8,380
Occupancy and equipment			4,109			2,731			6,840			1,539			8,379
Other (2)			2,730			5,259			7,989			4,231			12,220
Total expenses			221,793			99,247			321,040			47,248			368,288
Income (loss) before provision for income taxes		$	57,788		$	54,152		$	111,940		$	(35,498)		$	76,442
Segment assets at end of quarter		$	7,161,516		$	16,994,006		$	24,155,522		$	66,382		$	24,221,904
Acquisition of:
Capitalized software		$	6,970		$	2,176		$	9,146		$	—		$	9,146
Furniture, fixtures, equipment and building improvements		$	617		$	340		$	957		$	348		$	1,305
Amortization of capitalized software		$	11,175		$	1,535		$	12,710		$	103		$	12,813
Depreciation and amortization of furniture, fixtures, equipment and building improvements		$	976		$	652		$	1,628		$	290		$	1,918
(1)	All revenues are from external customers. The segments do not recognize intersegment revenues.
---	---

(2)	Other expense includes smaller balance expense categories not separately provided to the chief operating decision maker such as safekeeping, travel, postage and corporate insurance.

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		Quarter ended June 30, 2024
	****	Production		****	Servicing		****	Reportable segment total		****	Corporate and other		****	Consolidated total
		(in thousands)
Revenues: (1)
Net gains on loans held for sale at fair value		$	154,317		$	21,747		$	176,064		$	—		$	176,064
Loan origination fees			42,075			—			42,075			—			42,075
Fulfillment fees from PennyMac Mortgage Investment Trust			4,427			—			4,427			—			4,427
Net loan servicing fees			—			167,604			167,604			—			167,604
Management fees			—			—			—			7,133			7,133
Net interest income (expense):
Interest income			84,645			115,706			200,351			460			200,811
Interest expense			83,376			124,495			207,871			—			207,871
			1,269			(8,789)			(7,520)			460			(7,060)
Other			155			194			349			15,535			15,884
Total net revenues			202,243			180,756			382,999			23,128			406,127
Expenses:
Compensation			70,900			49,460			120,360			21,596			141,956
Loan origination			40,270			—			40,270			—			40,270
Technology			22,977			9,774			32,751			2,939			35,690
Servicing			—			22,920			22,920			—			22,920
Professional services			2,422			1,598			4,020			5,384			9,404
Occupancy and equipment			3,754			2,753			6,507			1,386			7,893
Marketing and advertising			4,793			21			4,814			631			5,445
Other (2)			1,958			3,528			5,486			3,209			8,695
Total expenses			147,074			90,054			237,128			35,145			272,273
Income (loss) before provision for income taxes		$	55,169		$	90,702		$	145,871		$	(12,017)		$	133,854
Segment assets at end of quarter		$	6,454,411		$	15,034,649		$	21,489,060		$	88,505		$	21,577,565
Acquisition of:
Capitalized software		$	3,884		$	775		$	4,659		$	138		$	4,797
Furniture, fixtures, equipment and building improvements		$	109		$	264		$	373		$	28		$	401
Amortization of capitalized software		$	9,772		$	2,013		$	11,785		$	457		$	12,242
Depreciation and amortization of furniture, fixtures, equipment and building improvements		$	925		$	741		$	1,666		$	332		$	1,998
(1)	All revenues are from external customers. The segments do not recognize intersegment revenues.
---	---

(2)	Other expense includes smaller balance expense categories not separately provided to the chief operating decision maker such as safekeeping, travel, postage and corporate insurance.

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		Six months ended June 30, 2025
	****	Production		****	Servicing		****	Reportable segment total		****	Corporate and other		****	Consolidated total
		(in thousands)
Revenues: (1)
Net gains on loans held for sale at fair value		$	391,106		$	64,590		$	455,696		$	—		$	455,696
Loan origination fees			105,702			—			105,702			—			105,702
Fulfillment fees from PennyMac Mortgage Investment Trust			11,104			—			11,104			—			11,104
Net loan servicing fees			—			314,681			314,681			—			314,681
Management fees			—			—			—			13,881			13,881
Net interest income (expense):
Interest income			189,493			221,257			410,750			1,050			411,800
Interest expense			170,148			277,511			447,659			—			447,659
			19,345			(56,254)			(36,909)			1,050			(35,859)
Other			263			965			1,228			9,200			10,428
Total net revenue			527,520			323,982			851,502			24,131			875,633
Expenses:
Compensation			203,325			104,254			307,579			61,950			369,529
Loan origination			112,932			—			112,932			—			112,932
Technology			52,941			19,890			72,831			9,623			82,454
Servicing			—			50,161			50,161			—			50,161
Marketing and advertising			18,299			757			19,056			2,765			21,821
Professional services			6,679			3,479			10,158			7,259			17,417
Occupancy and equipment			8,237			5,460			13,697			3,064			16,761
Other (2)			5,376			9,828			15,204			8,716			23,920
Total expenses			407,789			193,829			601,618			93,377			694,995
Income (loss) before provision for income taxes		$	119,731		$	130,153		$	249,884		$	(69,246)		$	180,638
Segment assets at end of period		$	7,161,516		$	16,994,006		$	24,155,522		$	66,382		$	24,221,904
Acquisition of:
Capitalized software		$	12,379		$	3,904		$	16,283		$	—		$	16,283
Furniture, fixtures, equipment and building improvements		$	804		$	369		$	1,173		$	503		$	1,676
Amortization of capitalized software		$	21,396		$	3,201		$	24,597		$	197		$	24,794
Depreciation and amortization of furniture, fixtures, equipment and building improvements		$	1,944		$	1,297		$	3,241		$	592		$	3,833
(1)	All revenues are from external customers. The segments do not recognize intersegment revenues.
---	---

(2)	Other expense includes smaller balance expense categories not separately provided to the chief operating decision maker such as safekeeping, travel, postage and corporate insurance.

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		Six months ended June 30, 2024
	****	Production		****	Servicing		****	Reportable segment total		****	Corporate and other		****	Consolidated total
		(in thousands)
Revenues: (1)
Net gains on loans held for sale at fair value		$	295,748		$	42,757		$	338,505		$	—		$	338,505
Loan origination fees			78,446			—			78,446			—			78,446
Fulfillment fees from PennyMac Mortgage Investment Trust			8,443			—			8,443			—			8,443
Net loan servicing fees			—			268,558			268,558			—			268,558
Management fees			—			—			—			14,321			14,321
Net interest income (expense):
Interest income			148,016			208,247			356,263			974			357,237
Interest expense			145,272			228,368			373,640			—			373,640
			2,744			(20,121)			(17,377)			974			(16,403)
Other			271			701			972			18,945			19,917
Total net revenue			385,652			291,895			677,547			34,240			711,787
Expenses:
Compensation			141,093			101,860			242,953			45,379			288,332
Loan origination			70,838			—			70,838			—			70,838
Technology			45,745			19,537			65,282			6,375			71,657
Servicing			—			39,024			39,024			—			39,024
Professional services			4,484			2,946			7,430			11,236			18,666
Occupancy and equipment			7,892			5,658			13,550			3,019			16,569
Marketing and advertising			8,389			50			8,439			677			9,116
Other (2)			3,364			8,464			11,828			8,020			19,848
Total expenses			281,805			177,539			459,344			74,706			534,050
Income (loss) before provision for income taxes		$	103,847		$	114,356		$	218,203		$	(40,466)		$	177,737
Segment assets at end of period		$	6,454,411		$	15,034,649		$	21,489,060		$	88,505		$	21,577,565
Acquisition of:
Capitalized software		$	7,325		$	1,085		$	8,410		$	251		$	8,661
Furniture, fixtures, equipment and building improvements		$	361		$	873		$	1,234		$	85		$	1,319
Amortization of capitalized software		$	19,258		$	4,216		$	23,474		$	949		$	24,423
Depreciation and amortization of furniture, fixtures, equipment and building improvements		$	1,884		$	1,438		$	3,322		$	659		$	3,981
(1)	All revenues are from external customers. The segments do not recognize intersegment revenues.
---	---

(2)	Other expense includes smaller balance expense categories not separately provided to the chief operating decision maker such as safekeeping, travel, postage and corporate insurance.

Table of Contents Note 27—Subsequent Events

Management has evaluated all events and transactions through the date the Company issued these consolidated financial statements. During this period:

●	On July 22, 2025, the Company announced a cash dividend of $0.30 per common share. The dividend will be paid on August 22, 2025 to common stockholders of record as of August 13, 2025.

●	All agreements to sell assets under agreements to repurchase assets that matured before the date of this Report were extended or renewed.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

The following discussion and analysis provides information that we believe is relevant to an assessment and understanding of our consolidated results of operations and financial condition. Unless the context indicates otherwise, references in this Quarterly Report on Form 10-Q to the words “we,” “us,” “our” and the “Company” refer to PFSI and its subsidiaries.

Our Company

We are a specialty financial services firm primarily focused on the production and servicing of U.S. residential mortgage loans (activities which we refer to as mortgage banking) and the management of investments related to the U.S. mortgage market. We believe that our operating capabilities, specialized expertise, access to long-term investment capital, and the experience of our management team across all aspects of the mortgage business allow us to profitably engage in mortgage banking and investing activities and capitalize on other related opportunities as they arise in the future.

Our primary assets are equity interests in Private National Mortgage Acceptance Company, LLC (“PNMAC”). We are the managing member of PNMAC, and we operate and control all of the businesses and affairs of PNMAC, and consolidate the financial results of PNMAC and its subsidiaries. We conduct our business in two segments: production and servicing:

●	The production segment performs loan origination, acquisition and sale activities.
●	The servicing segment performs loan servicing for both newly originated loans we are holding for sale and loans we service for others, including for PennyMac Mortgage Investment Trust, a mortgage real estate investment trust separately listed on the New York Stock Exchange under the ticker symbol “PMT”.
---	---

Our principal mortgage banking subsidiary, PennyMac Loan Services, LLC (“PLS”), is a non-bank producer and servicer of mortgage loans in the United States. PLS is a seller/servicer for the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”), each of which is a government-sponsored entity. PLS is also an approved issuer of securities guaranteed by the Government National Mortgage Association (“Ginnie Mae”), a lender of the Federal Housing Administration (“FHA”), and a lender/servicer of the U.S. Department of Veterans Affairs (“VA”) and the U.S. Department of Agriculture (“USDA”). We refer to each of Fannie Mae, Freddie Mac, Ginnie Mae, FHA, VA and USDA as an “Agency” and collectively as the “Agencies.” PLS is able to service loans in all 50 states, the District of Columbia, Puerto Rico, Guam and the U.S. Virgin Islands, and originate loans in all 50 states and the District of Columbia, either because PLS is properly licensed in a particular jurisdiction or exempt or otherwise not required to be licensed in that jurisdiction.

Our investment management subsidiary is PNMAC Capital Management, LLC (“PCM”), a Delaware limited liability company registered with the Securities Exchange Commission (“SEC”) as an investment adviser under the Investment Advisers Act of 1940, as amended. PCM has an investment management contract with PMT.

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Business Trends

Recent actions by the U.S. government administration with respect to trade, tariffs and government cost reduction initiatives have led to significant volatility in financial markets and uncertainty regarding the economic outlook, including inflation and interest rates. Elevated interest rates in recent years have constrained growth in the size of the mortgage origination market, which is currently projected to increase from $1.7 trillion in 2024 to $2.0 trillion in 2025 according to mortgage industry economists.

The opportunity for refinancing has increased in recent periods, driven by interest rate volatility and a greater proportion of outstanding mortgages with note rates near current market rates. If such interest rate volatility continues, it may drive greater mortgage production activity and higher prepayment speeds than we have experienced in recent years. Additionally, reductions in the Federal Reserve’s federal funds rate have reduced the costs of floating rate borrowings and placement fees we receive in relation to custodial funds that we manage as compared to the same periods in the prior year. The current period of economic uncertainty and market volatility may also lead to a reduction in economic activity and slowing home price growth or depreciation, which could lead to increasing mortgage delinquencies or defaults and increase losses from our representations and warranties.

We expect to sell a portion of the conventional loans and all of the jumbo loans from our correspondent channel to PMT in the third quarter of 2025.

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Results of Operations

Our results of operations are summarized below:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024		****
		(dollars in thousands, except per share amounts)
Revenues:
Loan production revenues (1)		$	299,564		$	222,566		$	572,502		$	425,394
Net loan servicing fees			150,395			167,604			314,681			268,558
Net interest expense			(17,648)			(7,060)			(35,859)			(16,403)
Other			12,419			23,017			24,309			34,238
Total net revenues			444,730			406,127			875,633			711,787
Expenses:
Compensation			187,541			141,956			369,529			288,332
Loan origination			68,836			40,270			112,932			70,838
Technology			42,257			35,690			82,454			71,657
Servicing			28,286			22,920			50,161			39,024
Marketing and advertising			12,389			5,445			21,821			9,116
Other			28,979			25,992			58,098			55,083
Total expenses			368,288			272,273			694,995			534,050
Income before (benefit from) provision for income taxes			76,442			133,854			180,638			177,737
(Benefit from) provision for income taxes			(60,021)			35,596			(32,105)			40,171
Net income		$	136,463		$	98,258		$	212,743		$	137,566
Earnings per share
Basic		$	2.64		$	1.93		$	4.12		$	2.71
Diluted		$	2.54		$	1.85		$	3.97		$	2.59
Annualized return on average stockholders' equity			13.9%			10.9%			10.9%			7.7%
Dividends declared per share		$	0.30		$	0.20		$	0.60		$	0.40
Income before provision for income taxes by reportable segment and corporate and other:
Production		$	57,788		$	55,169		$	119,731		$	103,847
Servicing			54,152			90,702			130,153			114,356
Corporate and other			(35,498)			(12,017)			(69,246)			(40,466)
		$	76,442		$	133,854		$	180,638		$	177,737
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization <br>("Adjusted EBITDA") (2)		$	262,021		$	249,718		$	550,054		$	477,446
During the period:
Interest rate lock commitments issued		$	39,597,584		$	27,998,822		$	71,054,404		$	50,584,454
Unpaid principal balance of loans produced or fulfilled for PMT		$	37,611,130		$	27,360,094		$	66,463,876		$	48,769,160
At end of period:
Interest rate lock commitments outstanding								$	10,998,207		$	7,596,114
Unpaid principal balance of loan servicing portfolio:
Owned:
Mortgage servicing rights and liabilities								$	463,150,304		$	396,451,017
Loans held for sale									6,783,240			6,108,082
									469,933,544			402,559,099
Subserviced for:
PMT									228,838,699			230,179,513
U.S. Department of Veterans Affairs									822,525			—
Other non-affiliates									72,153			—
									229,733,377			230,179,513
								$	699,666,921		$	632,738,612

Book value per share								$	78.04		$	71.76
(1)	Includes Net gains on loans held for sale at fair value, Loan origination fees and Fulfillment fees from PennyMac Mortgage Investment Trust.
---	---

(2)

To provide investors with information in addition to our results as determined by accounting principles generally accepted in the United States (“GAAP”), we disclose Adjusted EBITDA as a non-GAAP measure. Adjusted EBITDA is a measure that is frequently used in our industry to measure performance and we believe that this measure provides supplemental information that is useful to investors. Adjusted EBITDA is not a financial measure calculated in accordance with GAAP and should not be considered as a substitute for net income, or any other performance measure calculated in accordance with GAAP.

Table of Contents We define “Adjusted EBITDA” as net income plus provision for income taxes, depreciation and amortization, excluding decrease (increase) in fair value of mortgage servicing rights (“MSRs”) net of mortgage servicing liabilities (“MSLs”), due to changes in the valuation inputs we use in our valuation models, hedging (gains) losses associated with MSRs, stock-based compensation and interest expense on corporate debt or corporate revolving credit facilities and capital leases.

We believe that the presentation of Adjusted EBITDA provides useful information to investors regarding our results of operations because each measure assists both investors and management in analyzing and benchmarking the performance and value of our business. However, other companies may define Adjusted EBITDA differently, and as a result, our measures of Adjusted EBITDA may not be directly comparable to those of other companies.

Adjusted EBITDA measures have limitations as analytical tools, and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:

a)	they do not reflect every cash expenditure, future requirements for capital expenditures or contractual commitments;
b)	they do not reflect the significant interest expense or the cash requirements necessary to service interest or principal payment on our debt; and
---	---
c)	they are not adjusted for all non-cash income or expense items that are reflected in our consolidated statements of cash flows.
---	---

Because of these limitations, Adjusted EBITDA measures are not intended as alternatives to net income as an indicator of our operating performance and should not be considered as measures of discretionary cash available to us to invest in the growth of our business or as measures of cash that will be available to us to meet our obligations.

The following table presents a reconciliation of Adjusted EBITDA to our net income, the most directly comparable financial measure calculated and presented in accordance with GAAP, for the periods indicated:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Net income		$	136,463		$	98,258		$	212,743		$	137,566
(Benefit from) provision for income taxes			(60,021)			35,596			(32,105)			40,171
Income before (benefit from) provision for income taxes			76,442			133,854			180,638			177,737
Depreciation and amortization			14,731			14,240			28,627			28,404
(Increase) decrease in fair value of MSRs net of MSLs due to changes in valuation inputs used in valuation models			(15,929)			(99,425)			189,565			(269,404)
Hedging losses associated with MSRs			109,102			171,777			2,328			466,422
Stock‑based compensation			7,518			(2,212)			18,602			2,371
Interest expense on corporate debt or corporate revolving credit facilities and capital leases			70,157			43,968			130,294			82,800
Effect of non-recurring gain from joint venture and arbitration accrual			—			(12,484)			—			(10,884)
Adjusted EBITDA		$	262,021		$	249,718		$	550,054		$	477,446

Income Before (Benefit from) Provisions for Income Taxes

For the quarter ended June 30, 2025, income before income taxes decreased $57.4 million compared to the same quarter in 2024. The decrease was primarily due to a $96.0 million increase in total expenses, a $17.2 million decrease in Net loan servicing fees resulting from increases in net MSR valuation losses in excess of growth in servicing fees, a $10.6 million increase in Net interest expense and a $10.6 million decrease in other income, partially offset by

a $77.0 million increase in loan production revenue due to higher volume across all production channels.

Table of Contents For the six months ended June 30, 2025, income before income taxes increased $2.9 million compared to the same period in 2024. The increase was primarily due to a $147.1 million increase in loan production revenue due to higher volume across all production channels and a $46.1 million increase in Net loan servicing fees resulting from growth in our servicing portfolio, partially offset by a $19.5 million increase in Net interest expense, a $9.9 million decrease in other income and a $160.9 million increase in total expenses.

Table of Contents Net Gains on Loans Held for Sale at Fair Value

In our production segment, revenues reflect the effects of larger mortgage market volumes during the quarter and six months ended June 30, 2025 compared to the same periods in 2024. During the quarter and six months ended June 30, 2025, we recognized Net gains on loans held for sale at fair value totaling $234.7 million and $455.7 million, respectively, representing an increase of $58.6 million and $117.2 million, respectively, compared to the same periods in 2024.

Our net gains on loans held for sale are summarized below:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
From non-affiliates:
Cash losses:
Loans		$	(573,210)		$	(413,822)		$	(849,520)		$	(723,012)
Hedging activities			(105,772)			92,552			(416,471)			242,771
Total cash losses			(678,982)			(321,270)			(1,265,991)			(480,241)
Non-cash gains:
Changes in fair values of loans and derivative financial instruments outstanding at end of period:
Interest rate lock commitments			32,211			(1,055)			108,588			(20,841)
Loans			(15,268)			(2,695)			(102,307)			24,950
Hedging derivatives			76,919			(39,597)			242,572			(137,579)
			93,862			(43,347)			248,853			(133,470)
Mortgage servicing rights resulting from loan sales			814,538			541,207			1,464,887			953,727
Provisions for losses relating to representations and warranties:
Pursuant to loan sales			(4,054)			(4,129)			(7,601)			(8,081)
Reductions in liability due to changes in estimate			2,220			4,076			3,635			7,396
Total non-cash gains			906,566			497,807			1,709,774			819,572
Total gains on sale from non-affiliates			227,584			176,537			443,783			339,331
From PennyMac Mortgage Investment Trust			7,075			(473)			11,913			(826)
		$	234,659		$	176,064		$	455,696		$	338,505
During the period:
Interest rate lock commitments issued:
By loan type:
Government-insured or guaranteed		$	18,209,041		$	14,064,074		$	34,324,614		$	24,858,332
Conventional conforming			19,340,043			13,024,197			32,913,808			24,346,284
Jumbo			1,383,209			454,378			2,602,313			582,494
Closed-end second lien mortgage			665,291			456,173			1,213,669			797,344
		$	39,597,584		$	27,998,822		$	71,054,404		$	50,584,454
By production channel:
Correspondent		$	28,657,935		$	21,013,818		$	50,753,289		$	38,094,674
Broker direct			7,151,449			4,286,680			12,629,818			7,639,087
Consumer direct			3,788,200			2,698,324			7,671,297			4,850,693
		$	39,597,584		$	27,998,822		$	71,054,404		$	50,584,454
At end of period:
Loans held for sale at fair value								$	6,961,224		$	6,238,959
Commitments to fund and purchase loans								$	10,998,207		$	7,596,114

Table of Contents Non-Cash Elements of Gain on Sale of Loans Held for Sale

Our gains on loans held for sale include both cash and non-cash elements. We recognize a significant portion of our gains on loans held for sale when we make commitments to purchase or fund mortgage loans. We recognize this gain in the form of interest rate lock commitment (“IRLC”) derivatives. We adjust our initial gain amount as the loan purchase or origination process progresses until the loan is either funded or cancelled.

We also receive non-cash proceeds on sale that include our estimate of the fair value of MSRs and we incur MSLs (which represent the fair value of the costs we expect to incur in excess of the fees we receive for delinquent loans we have bought out of Ginnie Mae guaranteed securities and have resold to and service for investors) and we recognize the fair value of our estimate of the losses we expect to incur relating to the representations and warranties we provide in our loan sale transactions.

The MSRs, MSLs, and liabilities for representations and warranties we recognize represent our estimate of the fair value of future benefits and costs we will realize for years in the future. These estimates represented approximately 346% and 321% of our gains on sales of loans held for sale at fair value for the quarter and six months ended June 30, 2025, respectively, as compared to 307% and 282% for the same periods in 2024. These estimates change as circumstances change and changes in these estimates are recognized in income in subsequent periods. Subsequent changes in the fair value of our MSRs may significantly affect our income.

Interest Rate Lock Commitments, Mortgage Servicing Rights and Mortgage Servicing Liabilities

The methods and key inputs we use to measure and update our measurements of IRLCs, MSRs and MSLs are detailed in Note 7 – Fair Value – Valuation Techniques and Inputs to the consolidated financial statements included in this Quarterly Report.

Representations and Warranties

Our agreements with purchasers and insurers include representations and warranties related to the loans we sell. The representations and warranties require adherence to purchaser and insurer origination and underwriting guidelines, including but not limited to the validity of the lien securing the loan, property eligibility, borrower credit, income and asset requirements, and compliance with applicable federal, state and local law.

In the event of a breach of our representations and warranties, we may be required to either repurchase the loans with the identified defects or indemnify the purchaser or insurer. In such cases, we bear any subsequent credit loss on the loans. Our credit loss may be reduced by any recourse we have to correspondent originators that sold such loans to us and breached similar or other representations and warranties. In such event, we have the right to seek a recovery of related repurchase losses from that correspondent seller.

Our representations and warranties are generally not subject to stated limits of exposure. However, we believe that the current unpaid principal balance (“UPB”) of loans sold by us and subject to representation and warranty liability to date represents the maximum exposure to repurchases related to representations and warranties.

The level of the liability for losses under representations and warranties is difficult to estimate and requires considerable judgment. The level of loan repurchase losses is dependent on economic factors, purchaser or insurer loss mitigation strategies, and other external conditions that may change over the lives of the underlying loans. Our estimate of the liability for representations and warranties is developed by our credit risk administration staff and reviewed by our Management Risk Committee that includes our senior executives and senior management in our loan production, loan servicing, and credit risk management areas.

The method used to estimate our losses on representations and warranties is a function of our estimate of future defaults, loan repurchase rates, the severity of loss in the event of default, if applicable, and the probability of reimbursement by the correspondent loan seller. We establish a liability at the time loans are sold and periodically assess the adequacy of our recorded liability.

Table of Contents We recorded provisions for losses under representations and warranties relating to current loan sales as a component of Net gains on loans held for sale at fair value totaling $4.1 million and $7.6 million for the quarter and six months ended June 30, 2025, respectively, compared to $4.1 million and $8.1 million for the same periods in 2024. The slight decrease in the provision relating to current loan sales was primarily attributable to a lower expectation of future repurchases due to improved collateral quality for the quarter and six months ended June 30, 2025 compared to the same periods in 2024.

We also recorded reductions in the liability of $2.2 million and $3.6 million for the quarter and six months ended June 30, 2025 compared to $4.1 million and $7.4 million for the same periods in 2024. The reductions in the liability resulted from previously sold loans meeting performance criteria established by the Agencies which significantly limit the likelihood of certain repurchase or indemnification claims.

Following is a summary of loan repurchase activity and the UPB of loans subject to representations and warranties:


	Quarter ended June 30,					Six months ended June 30,
	2025		2024		****	2025		2024
	(in thousands)					(in thousands)
During the period:
Indemnification activity:
Loans indemnified at beginning of period	$	112,547	$	81,689		$	101,867	$	75,724
New indemnifications		6,367		14,292			18,403		22,013
Less indemnified loans sold, repaid or refinanced		2,881		999			4,237		2,755
Loans indemnified at end of period	$	116,033	$	94,982		$	116,033	$	94,982
Repurchase activity:
Total loans repurchased	$	25,418	$	23,468		$	45,360	$	44,863
Less:
Loans repurchased by correspondent lenders		15,585		14,839			31,077		25,781
Loans repaid by borrowers or resold		952		4,908			8,653		11,735
Net loans repurchased with losses chargeable to liability for representations and warranties	$	8,881	$	3,721		$	5,630	$	7,347
Losses charged to liability for representations and warranties	$	845	$	1,341		$	1,332	$	2,785
At end of period:
Unpaid principal balance of loans subject to representations and warranties						$	452,998,620	$	381,524,553
Liability for representations and warranties						$	31,763	$	28,688

During the quarter and six months ended June 30, 2025, we repurchased loans totaling $25.4 million and $45.4 million, respectively. We charged losses of $845,000 and $1.3 million against the liability during the quarter and six months ended June 30, 2025. Our losses arising from representations and warranties have historically been minimized by our ability to either recover most of the losses from our correspondent sellers or from our ability to profitably refinance and resell repurchased loans.

Elevated interest rate levels may affect certain of our correspondent sellers’ ability to honor their obligations to repurchase defective loans, may increase the level of borrower defaults and may increase the level of repurchases we are required to make, thereby making it more difficult to minimize losses on repurchased loans. We expect these developments may increase the losses we incur in relation to our recorded liability for representations and warranties compared to our historical experience. However, we believe our recorded liability is presently adequate to absorb such losses.

Table of Contents Loan Origination Fees

Loan origination fees increased $17.0 million and $27.3 million during the quarter and six months ended June 30, 2025, compared to the same periods in 2024 primarily due to an increase in production volume.

Fulfillment Fees from PennyMac Mortgage Investment Trust

Fulfillment fees from PMT represent fees we collect for services we perform on behalf of PMT in connection with the acquisition, packaging and sale of loans. The fulfillment fees are calculated based on the number of loans we fulfill for PMT.

Fulfillment fees increased $1.4 million and $2.7 million during the quarter and six months ended June 30, 2025, compared to the same periods in 2024; the increase was primarily due to an increase in the number of loans we fulfilled for PMT during the quarter and six months ended June 30, 2025 compared to the same periods in 2024.

Net Loan Servicing Fees

Our net loan servicing fee income has two primary components: fees earned for servicing the loans and the effects of MSR and MSL valuation changes, net of hedging results as summarized below:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Loan servicing fees		$	506,667		$	440,696		$	995,135		$	864,880
Effects of MSRs and MSLs net of hedging results			(356,272)			(273,092)			(680,454)			(596,322)
Net loan servicing fees		$	150,395		$	167,604		$	314,681		$	268,558

Loan Servicing Fees

Following is a summary of our loan servicing fees:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
From non-affiliates		$	435,517		$	375,040		$	853,204		$	733,066
From PennyMac Mortgage Investment Trust			21,645			20,264			43,374			40,526
Other:
Late charges			22,959			20,193			46,026			40,782
Other			26,546			25,199			52,531			50,506
			49,505			45,392			98,557			91,288
		$	506,667		$	440,696		$	995,135		$	864,880
Average UPB of loans serviced:
MSRs and MSLs		$	452,077,317		$	388,760,891		$	443,765,594		$	382,559,187
Subservicing		$	230,362,073		$	230,254,779		$	230,771,395		$	231,235,514

Loan servicing fees from non-affiliates generally relate to our MSRs which are primarily related to servicing we provide for loans included in Agency securitizations. These fees are contractually established at an annualized percentage of the UPB of the loan serviced and we collect these fees from borrower payments. Loan servicing fees from PMT are primarily related to PMT’s MSRs and are established at monthly per-loan amounts based on whether the loan is a fixed-rate or adjustable-rate loan and the loan’s delinquency or foreclosure status as detailed in Note 5*–Transactions with Related Parties* to the consolidated financial statements included in this Quarterly Report. Other loan servicing fees are comprised primarily of borrower-contracted fees such as late charges and reconveyance fees.

Table of Contents Loan servicing fees from non-affiliates and other fees increased during the quarter and six months ended June 30, 2025 compared to the same periods in 2024. The increases were primarily due to growth of our loan servicing portfolio. Other servicing fees increased due to growth in our MSR portfolio combined with increased incentives received for loss mitigation activities.

Effects of Mortgage Servicing Rights and Mortgage Servicing Liabilities

We have elected to carry our servicing assets and liabilities at fair value. Changes in fair value have two components: changes due to realization of the contractual servicing fees and changes due to changes in market inputs used to estimate the fair value of MSRs and MSLs. We endeavor to moderate the effects of changes in fair value by entering into derivatives transactions and holding principal-only stripped mortgage-backed securities.

Change in fair value of MSRs and MSLs and the related hedging results are summarized below:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
MSR and MSL valuation changes and hedging results:
Changes in fair value attributable to <br>changes in fair value inputs		$	15,929		$	99,425		$	(189,565)		$	269,404
Hedging results			(109,102)			(171,777)			(2,328)			(466,422)
			(93,173)			(72,352)			(191,893)			(197,018)
Changes in fair value attributable to realization of cash flows			(263,099)			(200,740)			(488,561)			(399,304)
Total change in fair value of mortgage servicing rights and mortgage servicing liabilities net of hedging results		$	(356,272)		$	(273,092)		$	(680,454)		$	(596,322)
Average balances:
Mortgage servicing rights		$	9,284,824		$	7,785,298		$	9,087,827		$	7,566,468
Mortgage servicing liabilities		$	1,640		$	1,718		$	1,654		$	1,744
At end of period:
Mortgage servicing rights								$	9,531,249		$	7,923,078
Mortgage servicing liabilities								$	1,643		$	1,708

Changes in fair value of MSRs attributable to changes in fair value inputs decreased during the quarter and six months ended June 30, 2025 compared to the same periods in 2024 due to decreases in interest rates during the quarter and six months ended June 30, 2025 compared to increasing interest rates during the same periods in 2024. Increasing interest rates reduce the rate of prepayments of the underlying loans, which increases the cash flows expected from the servicing rights, while decreasing interest rates have the opposite effect.

Hedging results reflect valuation losses attributable to the effects of interest rate volatility and increased hedging costs on the fair value of the hedging instruments during the quarter and interest rate decreases over the six months ended June 30, 2025 compared with interest rate increases in the same periods in 2024.

Changes in fair value attributable to realization of cash flows are influenced by changes in the level of servicing assets and liabilities and changes in estimates of the remaining cash flows to be realized. During the quarter and six months ended June 30, 2025, realization of cash flows increased compared to the same periods in 2024, primarily due to the growth in our investment in MSRs.

Table of Contents Following is a summary of our loan servicing portfolio:



		June 30,			December 31,
	****	2025		****	2024
		(in thousands)
Owned:
Mortgage servicing rights and liabilities
Originated		$	448,312,667		$	410,393,342
Purchased and assumed			14,837,637			15,681,406
			463,150,304			426,074,748
Loans held for sale			6,783,240			8,128,914
			469,933,544			434,203,662
Subserviced for:
PMT			228,838,699			230,753,581
U.S. Department of Veterans Affairs (1)			822,525			806,584
Other non-affiliates			72,153			—
			229,733,377			231,560,165
Total loans serviced		$	699,666,921		$	665,763,827
Delinquencies:
Owned servicing:
30-89 days		$	18,337,583		$	17,933,800
90 days or more			8,209,699			9,023,217
		$	26,547,282		$	26,957,017
Subservicing:
30-89 days		$	2,817,227		$	2,673,329
90 days or more			1,212,604			1,319,190
		$	4,029,831		$	3,992,519
(1)	Represents previously delinquent loans that have been purchased by the VA pursuant to the Veterans Affairs Servicing Purchase program where servicing is expected to be transferred to a servicer selected by the VA.
---	---

Following is a summary of characteristics of our MSR and MSL servicing portfolio as of June 30, 2025:


							Average
Loan type	****	Unpaid principal balance		****	Loan count	****	Note rate	****	Age (months)	****	Remaining maturity (months)	****		Loan size	****	FICO credit score at origination	****	Original LTV (1)	****	Current LTV (1)	****	60+ Delinquency (by UPB)
		(Dollars and loan count in thousands)
Government insured or guaranteed (2):
FHA		$	161,209,113		751		4.7%		46		317		$	215		683		93%		70%		5.3%
VA			128,898,548		463		4.0%		42		317		$	278		731		90%		70%		1.8%
USDA			20,809,405		140		4.1%		61		302		$	148		700		98%		65%		5.3%
Government-sponsored entities:
Fannie Mae			58,743,053		183		5.2%		29		318		$	321		763		75%		63%		0.6%
Freddie Mac			80,550,488		240		5.5%		22		326		$	335		760		76%		67%		0.7%
Closed-end second lien mortgage loans			2,050,611		26		9.4%		11		250		$	80		744		19%		18%		0.2%
Other (3)			10,889,086		27		6.8%		12		348		$	413		774		74%		70%		0.3%
		$	463,150,304		1,830		4.7%		38		318		$	253		723		86%		68%		2.8%
(1)	Loan-to-Value.
---	---
(2)	Government loans include loans securitized in Ginnie Mae pools as well as loans sold to private investors.
---	---
(3)	Represents conventional loans sold to private investors.
---	---

Table of Contents Net Interest Expense

Following is a summary of net interest expense:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Interest income:
Cash and short-term investment		$	10,919		$	13,172		$	20,926		$	27,754
Principal-only stripped mortgage-backed securities			6,948			9,074			18,543			9,344
Loans held for sale at fair value			105,725			86,283			193,119			151,704
Placement fees relating to custodial funds			97,975			92,230			177,770			168,363
Other			362			52			1,442			72
			221,929			200,811			411,800			357,237
Interest expense:
Short-term debt			116,853			110,696			214,886			185,208
Long-term debt			105,900			85,900			202,615			168,738
Interest shortfall on repayments of mortgage loans serviced for Agency securitizations			14,058			7,902			23,832			14,023
Interest on mortgage loan impound deposits			2,263			2,962			4,844			4,949
Other			503			411			1,482			722
			239,577			207,871			447,659			373,640
		$	(17,648)		$	(7,060)		$	(35,859)		$	(16,403)

Net interest expense increased $10.6 million and $19.5 million during the quarter and six months ended June 30, 2025 compared to the same periods in 2024. The increases were primarily due to the Company financing a larger investment in MSRs as well as inventory of loans held for sale and principal-only stripped MBS during 2025 as compared to 2024 and a decrease in interest income from cash and short-term investment due to a decrease in average cash balances, partially offset by increases in interest income from loans held for sale and earnings from custodial funds.

Management Fees from PennyMac Mortgage Investment Trust

Management fees decreased $264,000 and $440,000 during the quarter and six months ended June 30, 2025 compared to the same periods in 2024, due to decreases in PMT’s average shareholders’ equity which is the basis for the base management fees.

Expenses

Compensation

Compensation expenses are summarized below:


		Quarter ended June 30,						Six months ended June 30,
	****	2025		****	2024		****	2025		****	2024
		(in thousands)
Salaries and wages		$	111,446		$	92,364		$	220,094		$	185,148
Severance			420			17			745			660
Incentive compensation			46,079			32,935			84,150			59,100
Taxes and benefits			22,078			18,852			45,938			41,053
Stock and unit-based compensation			7,518			(2,212)			18,602			2,371
		$	187,541		$	141,956		$	369,529		$	288,332
Head count:
Average			4,589			3,951			4,524			3,937
Period end									4,779			4,012

Compensation expenses increased $45.6 million and $81.2 million during the quarter and six months ended 71

Table of Contents June 30, 2025 compared to the same periods in 2024. The increases were primarily due to an increase in head count and increased incentive compensation during the quarter and six months ended June 30, 2025, reflecting higher loan production volume and higher return on equity.

Loan Origination

Loan origination expenses increased $28.6 million and $42.1 million for the quarter and six months ended June 30, 2025 compared to the same periods in 2024. The increases were primarily due to higher origination volumes.

Technology

Technology expenses increased $6.6 million and $10.8 million during the quarter and six months ended June 30, 2025 compared to the same quarter in 2024. The increases were primarily due to increases in virtual desktop and cloud-related expenses.

Servicing

Servicing expenses increased $5.4 million and $11.1 million during the quarter and six months ended June 30, 2025 compared to the same periods in 2024. The increases were primarily due to increases in provision for losses on servicing advances resulting from higher delinquent loan balances during the quarter and six months ended June 30, 2025 compared to the same periods in 2024.

Marketing and advertising

Marketing and advertising expenses increased $6.9 million and $12.7 million during the quarter and six months ended June 30, 2025 compared to the same periods in 2024. The increases were primarily due to additional marketing expenses incurred as an Official Supporter of Team USA and increased marketing expenses for consumer direct lending.

Provision for Income Taxes

Our effective income tax rates were (78.5)% and 26.6% for the quarters ended June 30, 2025 and 2024, respectively, and (17.8)% and 22.6% for the six months ended June 30, 2025 and 2024, respectively. The decreases in the effective income tax rates for the quarter and six months ended June 30, 2025 compared to the same periods in 2024 are primarily due to a non-recurring $81.6 million net income tax benefit primarily due to the repricing of deferred tax liabilities resulting from changes to California's apportionment rules with the enactment of California Senate Bill 132, signed into law June 27, 2025 and effective January 1, 2025. The law requires financial institutions to apportion their California income using a single sales factor instead of a factor equally weighted with property, payroll and sales.

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Balance Sheet Analysis

Following is a summary of key balance sheet items as of the dates presented:


		June 30,			December 31,
		2025		****	2024
		(in thousands)
ASSETS
Cash and short-term investment		$	624,448		$	659,035
Principal-only stripped mortgage-backed securities			784,958			825,865
Loans held for sale at fair value			6,961,224			8,217,468
Derivative assets			180,642			113,076
Servicing advances, net			430,602			568,512
Investments in and advances to affiliates			31,569			31,150
Mortgage servicing rights at fair value			9,531,249			8,744,528
Loans eligible for repurchase			4,962,535			6,157,172
Other			714,677			770,081
Total assets		$	24,221,904		$	26,086,887

LIABILITIES AND STOCKHOLDERS' EQUITY
Short-term debt		$	8,044,550		$	9,181,719
Long-term debt			5,512,155			5,213,004
			13,556,705			14,394,723
Liability for loans eligible for repurchase			4,962,535			6,157,172
Income taxes payable			1,097,452			1,131,000
Other			572,712			574,341
Total liabilities			20,189,404			22,257,236
Stockholders' equity			4,032,500			3,829,651
Total liabilities and stockholders' equity		$	24,221,904		$	26,086,887
Leverage ratios:
Total debt / Stockholders' equity			3.4			3.8
Total debt / Tangible stockholders' equity (1)			3.5			3.9
(1)	Tangible stockholders’ equity represents total stockholders’ equity reduced by intangible assets, comprised of capitalized software, for the dates presented.
---	---

Total assets decreased $1.9 billion from $26.1 billion at December 31, 2024 to $24.2 billion at June 30, 2025. The decrease was primarily due to a decrease of $1.3 billion in loans held for sale at fair value and a decrease of $1.2 billion of loans eligible for repurchase, partially offset by an increase of $786.7 million of mortgage servicing rights.

Total liabilities decreased $2.1 billion from $22.3 billion at December 31, 2024 to $20.2 billion at June 30, 2025. The decrease was primarily due to a decrease of $838.0 million in borrowings and a decrease of $1.2 billion in liability for loans eligible for repurchase. As a result of our decreased inventory financing requirements, our leverage ratios decreased during the quarter ended June 30, 2025 from December 31, 2024.

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Cash Flows

Our cash flows are summarized below:


	Six months ended June 30,
	2025		****	2024		****	Change		****
	(in thousands)
Operating	$	934,642		$	(1,990,826)		$	2,925,468
Investing		(127,033)			(1,520,406)			1,393,373
Financing		(883,905)			3,168,197			(4,052,102)
Net decrease in cash	$	(76,296)		$	(343,035)		$	266,739

The net decrease in cash of $76.3 million during the six months ended June 30, 2025 is discussed below.

Operating activities

Net cash provided by operating activities totaled $934.6 million during the six months ended June 30, 2025 compared with net cash used in operating activities of $2.0 billion during the same period in 2024. Our cash flows from operating activities are primarily influenced by changes in the levels of our inventory of mortgage loans held for sale as shown below:


	Six months ended June 30,
	2025		2024
	(in thousands)
Cash flows from:
Loans held for sale	$	382,339	$	(2,414,187)
Other operating sources		552,303		423,361
	$	934,642	$	(1,990,826)

Investing activities

Net cash used in investing activities during the six months ended June 30, 2025 totaled $127.0 million, primarily due to a $140.7 million increase in margin deposits. Net cash used in investing activities during the six months ended June 30, 2024 totaled $1.5 billion, primarily due to $935.4 million in purchase of principal-only stripped MBS, $391.5 million in net settlement of derivative financial instruments used to hedge our investment in MSRs and a $178.5 million increase in short-term investment.

Financing activities

Net cash used in financing activities totaled $883.9 million during the six months ended June 30, 2025, primarily due to a decrease of $811.5 million in borrowings. The decrease in borrowings primarily reflects the decrease in inventory of loans held for sale. Net cash provided by financing activities totaled $3.2 billion during the six months ended June 30, 2024, primarily due to an increase of $3.2 billion in borrowings. The increase in borrowings primarily reflects the increase in inventory of loans held for sale and our investment in MSRs.

Liquidity and Capital Resources

Our liquidity reflects our ability to meet our current obligations (including our operating expenses and, when applicable, the retirement of, and margin calls relating to, our debt, and margin calls relating to hedges on our commitments to purchase or originate mortgage loans and on our MSR investments), fund new originations and purchases, and make investments as we identify them. We expect our primary sources of liquidity to be through cash flows from business activities, proceeds from bank borrowings and proceeds from and issuance of equity or debt offerings. We believe that our liquidity is sufficient to meet our current liquidity needs.

Table of Contents Our current borrowing strategy is to finance our assets where we believe such borrowing is prudent, appropriate and available. Our primary borrowing activities are in the form of sales of assets under agreements to repurchase, sales of mortgage loan participation purchase and sale certificates, notes payable secured by mortgage servicing rights and unsecured senior notes. A significant amount of our borrowings have short-term maturities and provide for advances with terms ranging from 30 days to 364 days. Because a significant portion of our current debt facilities consist of short-term debt, we expect to renew these facilities in advance of maturity in order to ensure our ongoing liquidity and access to capital or otherwise allow ourselves sufficient time to replace any necessary financing.

Secured debt facilities for MSRs and servicing advances take various forms. Fannie Mae MSRs, Ginnie Mae MSRs and servicing advances may be pledged to special purpose entities, each of which may issue variable funding notes (“VFNs”) and term notes and term loans that are secured by such Ginnie Mae or Fannie Mae assets. Term notes are issued to qualified institutional buyers under Rule 144A of Securities Act and term loans are syndicated to banking entities, while the VFNs are sold to bank partners under agreements to repurchase. Freddie Mac MSRs are pledged to lenders under a bi-lateral loan and security agreement.

On May 1, 2025, PFSI issued $850 million in 6.875% unsecured senior notes due in 2032 in a private placement to “qualified institutional buyers” under Rule 144A of the Securities Act. On May 12, 2025, PFSI redeemed $650 million in 5.375% unsecured senior notes due in October, 2025. On June 20, 2025, PFSI, through its wholly-owned subsidiaries PNMAC, PLS and the Issuer Trust, redeemed $500 million in 4.25% Term Notes due in May 2027.

Our repurchase agreements represent the sales of assets together with agreements for us to buy back the respective assets at a later date. The table below presents the average, maximum daily and ending balances:


	Quarter ended June 30,				Six months ended June 30,
	2025		2024		2025		****	2024
	(in thousands)				(in thousands)
Average balance	$	7,183,987	$	5,761,107	$	6,649,802		$	4,651,823
Maximum daily balance	$	8,581,781	$	7,122,796	$	8,690,936		$	7,122,796
Balance at quarter end					$	7,351,846		$	6,414,295

The differences between the average and maximum daily balances on our repurchase agreements reflect both the effect of increasing loan inventory levels during the six months ended June 30, 2025 and the fluctuations throughout the periods of our inventory as we fund and pool mortgage loans for sale in guaranteed mortgage securitizations.

Our repurchase agreements also contain margin call provisions that, upon notice from the applicable lender at its option, require us to transfer cash or, in some instances, additional assets in an amount sufficient to eliminate any margin deficit. A margin deficit will generally result from any decrease in the market value (as determined by the applicable lender) of the assets subject to the related financing agreement. Upon notice from the applicable lender, we will generally be required to satisfy the margin call on the day of such notice or within one business day thereafter, depending on the timing of the notice.

Our secured financing agreements at PLS require us to comply with various financial and other restrictive covenants. The most significant financial covenants currently include the following:

●	a minimum in unrestricted cash and cash equivalents of $100 million;

●	a minimum tangible net worth of $1.25 billion;

●	a maximum ratio of total indebtedness to tangible net worth of 10:1; and

●	at least one other warehouse or repurchase facility that finances amounts and assets that are similar to those being financed under certain of our existing secured financing agreements.

With respect to servicing performed for PMT, PLS is also subject to certain covenants under PMT’s debt agreements. Covenants in PMT’s debt agreements are equally, or sometimes less, restrictive than the covenants described above. 75

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PFSI has issued unsecured senior notes (the “Unsecured Notes”) to qualified institutional buyers under Rule 144A of the Securities Act. The Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by the Company’s existing and future wholly-owned domestic subsidiaries (other than certain excluded subsidiaries defined in the indentures under which the Unsecured Notes were issued).

Our Unsecured Notes’ indentures contain financial and other restrictive covenants that limit the Company and our restricted subsidiaries’ ability to engage in specified types of transactions, including, but not limited to the following:

●	pay dividends or distributions, redeem or repurchase equity, prepay subordinated debt and make certain loans or investments;
●	incur, assume or guarantee additional debt or issue preferred stock;
---	---
●	incur liens on assets;
---	---
●	merge or consolidate with another person or sell all or substantially all of our assets to another person;
---	---
●	transfer, sell or otherwise dispose of certain assets including capital stock of subsidiaries;
---	---
●	enter into transactions with affiliates; and
---	---
●	allow to exist certain restrictions on the ability of our non-guarantor restricted subsidiaries to pay dividends or make other payments to us.
---	---

Although financial and other covenants limit the amount of indebtedness that we may incur and affect our liquidity through minimum cash reserve requirements, we believe that these covenants currently provide us with sufficient flexibility to successfully operate our business and obtain the financing necessary to achieve that purpose.

We are also subject to liquidity and net worth requirements established by the Federal Housing Finance Agency (“FHFA”) for Agency seller/servicers and Ginnie Mae for single-family issuers. FHFA and Ginnie Mae have established minimum liquidity and net worth requirements for their approved non-depository single-family sellers/servicers in the case of Fannie Mae, Freddie Mac, and Ginnie Mae for its approved single-family issuers, and Ginnie Mae has issued risk-based capital requirements. We believe that we are in compliance with the Agency’s pending requirements as of June 30, 2025.

We have a common stock repurchase program which allows us to repurchase common shares of up to $2 billion. Share repurchases may be effected through open market purchases or privately negotiated transactions in accordance with applicable rules and regulations. The stock repurchase program does not have an expiration date and the authorization does not obligate us to acquire any particular amount of common stock. From inception through June 30, 2025, we have repurchased approximately $1.8 billion of common shares under our stock repurchase program.

We continue to explore a variety of means of financing our business, including debt financing through bank warehouse lines of credit, bank loans, repurchase agreements, securitization transactions and corporate debt. However, there can be no assurance as to how much additional financing capacity such efforts will produce, what form the financing will take or whether such efforts will be successful.

Debt Obligations

As described further above in “Liquidity and Capital Resources,” we currently finance certain of our assets through short-term borrowings with major financial institutions in the form of sales of assets under agreements to repurchase and mortgage loan participation purchase and sale agreements. We access the capital market for long-term debt through the issuance of secured term notes, term loans and Unsecured Notes. The issuer under our secured term note facilities is PLS or a wholly-owned issuer trust guaranteed by PNMAC. In addition, PFSI has issued Unsecured Notes guaranteed by certain of its restricted wholly-owned domestic subsidiaries.

PLS is required to comply with financial and other restrictive covenants in certain financing agreements, as 76

Table of Contents described further above in “Liquidity and Capital Resources”. As of June 30, 2025, we believe PLS was in compliance in all material respects with these covenants.

Many of our debt financing agreements contain a condition precedent to obtaining additional funding that requires PLS to maintain positive net income for at least one of the previous two consecutive quarters, or other similar measures. PLS is compliant with all such conditions.

The financing agreements also contain margin call provisions that, upon notice from the applicable lender, require us to transfer cash or, in some instances, additional assets in an amount sufficient to eliminate any margin deficit. Upon notice from the applicable lender, we will generally be required to satisfy the margin call on the day of such notice or within one business day thereafter, depending on the timing of the notice.

In addition, the financing agreements contain events of default (subject to certain materiality thresholds and grace periods), including payment defaults, breaches of covenants and/or certain representations and warranties, cross-defaults, guarantor defaults, servicer termination events and defaults, material adverse changes, bankruptcy or insolvency proceedings and other events of default customary for these types of transactions. The remedies for such events of default are also customary for these types of transactions and include the acceleration of the principal amount outstanding under the agreements and the liquidation by our lenders of the mortgage loans or other collateral then subject to the agreements.

Table of Contents Our debt obligations have the following sizes and maturities:


		Outstanding			Total			Committed			Facility
Lender	****	indebtedness (1)		****	facility size (2)		****	facility (2)		****	Maturity date (2)
		(dollar amounts in thousands)									****
Loans sold under agreements to repurchase
Atlas Securitized Products, L.P.		$	1,584,762		$	1,584,762		$	300,000		June 26, 2026
Bank of America, N.A.		$	1,230,023		$	1,525,000		$	800,000		June 9, 2027
Royal Bank of Canada		$	633,971		$	1,000,000		$	325,000		May 8, 2026
JP Morgan Chase Bank, N.A.		$	519,934		$	519,934		$	—		June 28, 2026
Citibank, N.A.		$	470,812		$	800,000		$	450,000		June 11, 2026
BNP Paribas		$	345,257		$	600,000		$	250,000		September 30, 2026
Wells Fargo Bank, N.A.		$	321,627		$	600,000		$	300,000		June 11, 2027
Morgan Stanley Bank, N.A.		$	320,396		$	600,000		$	250,000		May 22, 2026
Goldman Sachs Bank USA		$	47,950		$	200,000		$	100,000		February 13, 2027
Barclays Bank PLC		$	80,434		$	300,000		$	250,000		March 6, 2026
JP Morgan Chase Bank, N.A. (EBO facility)		$	18,580		$	480,066		$	150,000		June 25, 2027
Mizuho Bank, Ltd.		$	25,642		$	250,000		$	125,000		March 14, 2026
Nomura Corporate Funding Americas		$	84,739		$	84,739		$	84,739		January 22, 2026
Servicing assets sold under agreements to repurchase
Atlas Securitized Products, L.P.		$	755,000		$	1,415,238		$	200,000		June 29, 2026
Nomura Corporate Funding Americas		$	50,000		$	365,261		$	365,261		August 4, 2025
Goldman Sachs Bank USA		$	50,000		$	550,000		$	200,000		October 25, 2026
Mizuho Bank, Ltd.		$	50,000		$	350,000		$	50,000		July 25, 2026
Mortgage-backed securities sold under agreements to repurchase
JP Morgan Chase Bank, N.A.		$	269,661
Santander US Capital Markets LLC		$	240,555
Wells Fargo Bank, N.A.		$	219,918
Bank of America, N.A.		$	32,585
Mortgage loan participation purchase and sale agreements
Bank of America, N.A.		$	701,233		$	750,000		$	—		June 10, 2026
Notes payable
GMSR 2023-GTL1 Loans		$	680,000		$	680,000					February 25, 2028
GMSR 2023-GTL2 Loans		$	125,000		$	125,000					October 25, 2028
GMSR 2024-GT1 Notes		$	425,000		$	425,000					March 26, 2029
Citibank, N.A. FHLMC MSR Facility		$	100,000		$	200,000		$	100,000		June 11, 2026
Barclays FHLMC MSR Facility		$	—		$	200,000		$	100,000		March 6, 2026
Unsecured senior notes
Unsecured Notes - 4.25%		$	650,000								February 15, 2029
Unsecured Notes - 5.75%		$	500,000								September 15, 2031
Unsecured Notes - 7.875%		$	750,000								December 15, 2029
Unsecured Notes - 7.125%		$	650,000								November 15, 2030
Unsecured Notes - 6.875%		$	850,000								February 15, 2033
Unsecured Notes - 6.875%		$	850,000								May 15, 2032
(1)	Outstanding indebtedness as of June 30, 2025.
---	---
(2)	Total facility size, committed facility and maturity date include contractual changes through the date of this Report.
---	---

Table of Contents The amount at risk (the fair value of the assets pledged plus the related margin deposit, less the amount advanced by the counterparty and accrued interest) relating to our assets sold under agreements to repurchase is summarized by counterparty below as of June 30, 2025:

Loans held for sale and MSRs



					Weighted average
Counterparty	****	Amount at risk		****	maturity of advances	****	Facility maturity
		(in thousands)
Atlas Securitized Products, L.P., Goldman Sachs Bank USA, Nomura Corporate Funding Americas and Mizuho Bank, Ltd. (1)		$	6,174,715		June 18, 2026		June 18, 2026
Atlas Securitized Products, L.P.		$	158,877		November 19, 2025		June 26, 2026
Bank of America, N.A.		$	92,204		August 6, 2025		June 9, 2027
JP Morgan Chase Bank, N.A.		$	38,981		October 21, 2025		July 10, 2026
Royal Bank of Canada		$	33,779		July 30, 2025		May 8, 2026
Citibank, N.A.		$	29,756		September 4, 2025		June 11, 2026
Nomura Corporate Funding Americas		$	19,151		July 14, 2025		January 22, 2026
Morgan Stanley Bank, N.A.		$	18,275		September 10, 2025		May 22, 2026
Wells Fargo Bank, N.A.		$	15,359		September 14, 2025		June 11, 2027
Barclays Bank PLC		$	14,165		November 6, 2025		March 6, 2026
BNP Paribas		$	13,186		September 14, 2025		September 30, 2026
Mizuho Bank, Ltd.		$	8,733		February 19, 2026		March 14, 2026
Goldman Sachs Bank USA		$	2,222		September 5, 2025		February 13, 2027
(1)	The borrowing facilities are in the form of a sale of a variable funding note under an agreement to repurchase. The facility maturity date represents a weighted average with maturity dates ranging from August 4, 2025 through October 28, 2026.
---	---

Principal-only stripped MBS


Counterparty	****	Amount at risk		****	Maturity
		(in thousands)
Bank of America, N.A.		$	2,846		July 25, 2025
JP Morgan Chase Bank, N.A.		$	22,094		July 7, 2025
Wells Fargo Bank, N.A.		$	17,963		July 23, 2025
Santander US Capital Markets LLC		$	15,227		July 15, 2025

Critical Accounting Estimates

Preparation of financial statements in compliance with GAAP requires us to make estimates that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the reporting period. Certain of these estimates significantly influence the portrayal of our financial condition and results, and they require us to make difficult, subjective or complex judgments. Our critical accounting policies primarily relate to our fair value estimates.

Our Annual Report on Form 10-K for the year ended December 31, 2024 contains a discussion of our critical accounting policies, which utilize relevant critical accounting estimates. There have been no significant changes in our critical accounting policies and estimates during the quarter ended June 30, 2025 as compared to the critical accounting policies and estimates disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Market risk is the exposure to loss resulting from changes in interest rates, foreign currency exchange rates, commodity prices, equity prices, real estate values and other market-based risks. The primary market risks that we are exposed to are fair value risk, interest rate risk and prepayment risk. 79

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Fair Value Risk

Our IRLCs, mortgage loans held for sale, principal-only stripped MBS, MSRs and MSLs are reported at their fair values. The fair value of these assets fluctuates primarily due to changes in interest rates. The fair value risk we face is primarily attributable to interest rate risk and prepayment risk.

Interest Rate Risk

Interest rate risk is highly sensitive to many factors, including governmental monetary and tax policies, domestic and international economic and political considerations, and other factors beyond our control. Changes in interest rates affect both the fair value of, and interest income we earn from, our mortgage-related investments and our derivative financial instruments. This effect is most pronounced with fixed-rate mortgage assets.

In general, rising interest rates negatively affect the fair value of our IRLCs, inventory of mortgage loans held for sale, and principal-only stripped MBS and positively affect the fair value of our MSRs. Changes in interest rates significantly influence the prepayment speeds of the loans underlying our investments in MSRs, which can have a significant effect on their fair values. Changes in interest rate are most prominently reflected in the prepayment speeds of the loans underlying our investments in MSRs and the discount rate used in their valuation.

Our operating results will depend, in part, on differences between the income from our investments and our financing costs. Presently most of our secured debt financing is based on a floating rate of interest calculated on a fixed spread over the relevant index, as determined by the particular financing arrangement.

Prepayment Risk

To the extent that the actual prepayment rate on the mortgage loans underlying our MSRs differs from what we projected when we initially recognized these assets and liabilities when we measure fair value as of the end of each reporting period, the carrying value of these assets and liabilities will be affected. In general, a decrease in the principal balances of the mortgage loans underlying our MSRs or an increase in prepayment expectations will decrease our estimates of the fair value of the MSRs, thereby reducing net servicing income, partially offset by the beneficial effect on net servicing income of a corresponding reduction in the fair value of our MSLs and an increase in the fair value of our principal-only stripped MBS.

Risk Management Activities

We engage in risk management activities primarily in an effort to mitigate the effect of changes in interest rates on the fair value of our assets. To manage this price risk, we use derivative financial instruments acquired with the intention of moderating the risk that changes in market interest rates will result in unfavorable changes in the fair value of our assets, primarily prepayment exposure on our MSR investments as well as IRLCs and our inventory of loans held for sale. Our objective is to minimize our hedging expense and maximize our loss coverage based on a given hedge expense target. We do not use derivative financial instruments other than IRLCs for purposes other than in support of our risk management activities.

Our strategies are reviewed daily within a disciplined risk management framework. We use a variety of interest rate and spread shifts and scenarios and define target limits for market value and liquidity loss in those scenarios. With respect to our IRLCs and inventory of loans held for sale, we use MBS forward sale contracts to lock in the price at which we will sell the mortgage loans or resulting MBS, and further use MBS put options to mitigate the risk of our IRLCs not closing at the rate we expect. With respect to our MSRs, we seek to mitigate mortgage-based loss exposure utilizing MBS forward purchase and sale contracts and principal-only stripped MBS, address exposures to smaller interest rate shifts with Treasury and interest rate swap futures, and use options and swaptions to achieve target coverage levels for larger interest rate shocks. 80

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Fair Value Sensitivities

The following sensitivity analyses are limited in that they were performed at a particular point in time; only contemplate the movements in the indicated variables; do not incorporate changes to other variables; are subject to the accuracy of various models and inputs used; and do not incorporate other factors that would affect our overall financial performance in such scenarios, including operational adjustments made by management to account for changing circumstances. For these reasons, the following estimates should not be viewed as earnings forecasts.

Mortgage Servicing Rights

The following tables summarize the estimated change in fair value of MSRs as of June 30, 2025, given several shifts in pricing spreads, prepayment speed and annual per loan cost of servicing:


Change in fair value attributable to shift in:	****	-20%		****	-10%		****	-5%		****	+5%		****	+10%		****	+20%
		(in thousands)
Prepayment speed		$	683,239		$	328,959		$	161,490		$	(155,827)		$	(306,286)		$	(592,174)
Pricing spread		$	519,194		$	252,869		$	124,812		$	(121,678)		$	(240,330)		$	(468,962)
Annual per-loan cost of servicing		$	206,097		$	103,048		$	51,524		$	(51,524)		$	(103,048)		$	(206,097)

Item 4. Controls and Procedures

Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. However, no matter how well a control system is designed and operated, it can provide only reasonable, not absolute, assurance that it will detect or uncover failures within the Company to disclose material information otherwise required to be set forth in our periodic reports.

Our management has conducted an evaluation, with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Report as required by paragraph (b) of Rule 13a-15 under the Exchange Act. Based on our evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective, as of the end of the period covered by this Report, to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the applicable rules and forms, and that it is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting during the quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Table of Contents PART II. OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, the Company may be involved in various legal and regulatory proceedings, lawsuits and other claims arising in the ordinary course of its business. The amount, if any, of ultimate liability with respect to such matters cannot be determined, but despite the inherent uncertainties of litigation, management believes that the ultimate disposition of any such proceedings and exposure will not have, individually or taken together, a material adverse effect on the financial condition, results of operations, or cash flows of the Company.

Item 1A. Risk Factors

There have been no material changes from the risk factors set forth under Item 1A. For a discussion of our risk factors refer to our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 19, 2025.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

There were no sales of unregistered equity securities during the quarter ended June 30, 2025.

Stock Repurchase Program


		Total number of shares purchased		Average price paid per share		Total number of shares purchased as part of publicly announced plans or program (1)		Approximate dollar value of shares that may yet be purchased under the plans or program (1)
April 1, 2025 – April 30, 2025			—	$	—		—	$	212,338,815
May 1, 2025 – May 31, 2025			—	$	—		—	$	212,338,815
June 1, 2025 – June 30, 2025			—	$	—		—	$	212,338,815
Total			—	$	—		—	$	212,338,815
(1)	In August 2021, the Company’s board of directors approved an increase to the Company’s common stock repurchase program from $1 billion to $2 billion. The stock repurchase program does not require the Company to purchase a specific number of shares, and the timing and amount of any shares repurchased are based on market conditions and other factors, including price, regulatory requirements and capital availability. Stock repurchases may be affected through privately negotiated transactions or open market purchases, including pursuant to a trading plan implemented pursuant to Rule 10b5-1 of the Exchange Act. The stock repurchase program does not have an expiration date but may be suspended, modified or discontinued at any time without prior notice.
---	---

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

As of June 30, 2025, the following directors or Section 16 officers adopted, modified or terminated the following Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements (in each case, as defined in Item 408(a) of Regulation S-K):

Table of Contents On June 2, 2025, Daniel Perotti, Senior Managing Director and Chief Financial Officer, adopted a trading plan to sell up to 35,100 shares of the Company’s common stock and up to 39,121 shares of the Company’s common stock underlying unexercised stock options. The trading plan will expire on August 14, 2026. Mr. Perotti’s trading plan was entered into during an open insider trading window and is intended to satisfy Rule 10b5-1(c) under the Exchange Act and the Company’s policies regarding insider transactions.

During the quarter ended June 30, 2025, none of our directors or executive officers (as defined in Rule 16a-1(f)), other than Mr. Perotti, informed us of the adoption, modification, or termination of any “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement” (in each case, as defined in Item 408(a) of Regulation S-K).

Table of Contents

Item 6. Exhibits

		Incorporated by Reference from the Below-Listed Form (Each Filed under SEC File Number 001-35916 or 001-38727)
Exhibit No.	Exhibit Description	Form	Filing Date

2.1	Contribution Agreement and Plan of Merger, dated as of August 2, 2018, by and among PennyMac Financial Services, Inc., New PennyMac Financial Services, Inc., New PennyMac Merger Sub, LLC, Private National Mortgage Acceptance Company, LLC, and the Contributors.	8-K12B	November 1, 2018

3.1	Amended and Restated Certificate of Incorporation of New PennyMac Financial Services, Inc.	8-K12B	November 1, 2018

3.1.1	Certificate of Amendment to Amended and Restated Certificate of Incorporation of New PennyMac Financial Services, Inc.	8-K12B	November 1, 2018

3.2	Amended and Restated Bylaws of New PennyMac Financial Services, Inc.	8-K12B	November 1, 2018

3.2.1	Amendment to Amended and Restated Bylaws of PennyMac Financial Services, Inc. (formerly known as New PennyMac Financial Services, Inc.).	10-Q	November 4, 2019

3.3	Amendment to the Amended and Restated Bylaws of PennyMac Financial Services, Inc.<br><br>	8-K	September 6, 2024
3.4	Third Amendment to the Amended and Restated Bylaws of PennyMac Financial Services, Inc.	8-K	January 3,<br><br>2025

4.1	Indenture, dated as of May 8, 2025, among PennyMac Financial Services, Inc., the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee, relating to the 6.875% Senior Notes due 2032.	8-K	May 8,<br><br>2025

4.2	Form of Global Note for 6.875% Senior Notes due 2032 (included in Exhibit 4.1).	8-K	May 8,<br><br>2025

10.1	Amendment No. 1 to Fourth Amended and Restated Management Agreement, by and among PennyMac Mortgage Investment Trust, PennyMac Operating Partnership, L.P. and PNMAC Capital Management, LLC, dated as of June 23, 2025.	*

10.2	Amendment No. 1 to Third Amended and Restated Mortgage Banking Services Agreement, between PennyMac Loan Services, LLC and PennyMac Corp., dated as of June 23, 2025.	*

31.1	Certification of David A. Spector pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	*

31.2	Certification of Daniel S. Perotti pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	*

Table of Contents

		Incorporated by Reference from the Below-Listed Form (Each Filed under SEC File Number 001-35916 or 001-38727)
Exhibit No.	Exhibit Description	Form	Filing Date

32.1	Certification of David A. Spector pursuant to Rule 13a-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.	**

32.2	Certification of Daniel S. Perotti pursuant to Rule 13a-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.	**

101	Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024, (ii) the Consolidated Statements of Income for the quarter and six months ended June 30, 2025 and June 30, 2024, (iii) the Consolidated Statements of Changes in Stockholders’ Equity for the quarter and six months ended June 30, 2025 and June 30, 2024, (iv) the Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and June 30, 2024, and (v) the Notes to the Consolidated Financial Statements.	*

101.INS	XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

101.SCH	Inline XBRL Taxonomy Extension Schema Document

101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document

104	Cover Page Interactive Data File (embedded within the Inline XBRL document and contained in Exhibit 101).

*Filed herewith

† Indicates management contract or compensatory plan or arrangement.

**The certifications attached hereto as Exhibits 32.1 and 32.2 are furnished to the SEC pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. 85

Table of Contents SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

	PENNYMAC FINANCIAL SERVICES, INC.


Dated: July 29, 2025	By:	/s/ DAVID A. SPECTOR
		David A. Spector
		Chairman and Chief Executive Officer<br><br>(Principal Executive Officer)

Dated: July 29, 2025	By:	/s/ DANIEL S. PEROTTI
		Daniel S. Perotti
		Senior Managing Director and<br><br>Chief Financial Officer<br><br>(Principal Financial Officer)

Corporate Template

EXHIBIT 10.1 AMENDMENT NO. 1

**** FOURTH AMENDED AND RESTATED

MANAGEMENT AGREEMENT

Amendment No. 1 to Fourth Amended and Restated Management Agreement, dated as of June 23, 2025 (the “Amendment”), by and among PennyMac Mortgage Investment Trust, a Maryland real estate investment trust (the “Trust”), PennyMac Operating Partnership, L.P., a Delaware limited partnership (the “Operating Partnership”), and PNMAC Capital Management, LLC, a Delaware limited liability company (the “Manager”).

RECITALS

WHEREAS, the Trust, the Operating Partnership and the Manager are parties to that certain Second Amended and Restated Management Agreement, dated as of December 16, 2024 (the “Existing Management Agreement” and, as amended by the Amendment, the “Management Agreement”). Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Existing Management Agreement.

WHEREAS, the Trust, the Operating Partnership and the Manager have agreed, subject to the terms and conditions of this Amendment, that the Existing Management Agreement be amended to incorporate certain agreed upon revisions that reflect the original intent of the Existing Management Agreement.

NOW, THEREFORE, in consideration of the mutual premises and mutual obligations set forth herein, the Trust, the Operating Partnership and the Manager hereby agree that the Existing Management Agreement is hereby amended as follows:

SECTION 1.Definitions. Section 2 of the Existing Management Agreement is hereby amended by deleting the definitions of “Incentive Fee” and “Shareholders’ Equity” in their entirety and replacing them with the following:

“Incentive Fee” means an incentive management fee calculated and payable (in cash or Common Shares (subject to reasonable restrictions on sale and transfer, provided that (i) the Trust shall use commercially reasonable efforts to cause, at its sole expense, any Common Shares issued in payment of the Incentive Fee to be registered for sale under the Securities Act, (ii) the Manager may sell or distribute such Common Shares in the manner that it determines, consistent with the Trust’s Policy Against Insider Trading and any applicable securities laws, including pursuant to Rule 10b5-1 under the Exchange Act, and (iii) the amount of the Incentive Fee payable in any particular year that may be paid in Common Shares shall be limited to 50% of the Incentive Fee payable for such year), as determined by a majority of the Independent Trustees) each fiscal year in arrears in an amount equal to the sum of:

(a)10% per annum of the dollar amount by which the Return exceeds the High Watermark plus the product of:

(1)the average Common Shareholder’s Equity during the period; and

(2)8.0%,

but is less than or equal to the High Watermark plus the product of (i) the average Common Shareholder’s Equity during the period and (ii) 12%; plus

(b)15% per annum of the dollar amount by which the Return equals or exceeds the High Watermark plus the product of:

(1)the average Common Shareholder’s Equity during the period; and

(2)12%,

but is less than the High Watermark plus the product of (i) the average Common Shareholder’s Equity during the period and (ii) 16%; plus

(1)the average Common Shareholder’s Equity during the period; and

(2)16%.

For purposes of calculating the Incentive Fee, outstanding limited partnership interests in the Operating Partnership (other than limited partnership interests held by the Trust) shall be treated as outstanding Common Shares.

“Shareholders’ Equity” means:

(A)the sum of the net proceeds from any issuances of the Trust’s equity securities since inception (allocated on a pro rata daily basis for such issuances during the fiscal quarter of any such issuance); plus

(B)the Trust’s retained earnings at the end of the second month of such quarter; less

(C)any amount that the Trust pays for repurchases or redemptions of its equity securities (allocated on a pro rata daily basis for such repurchases or redemptions during the fiscal quarter of any such repurchases or redemptions); excluding -2-

(D)one-time events pursuant to changes in GAAP and certain other non-cash charges after discussions between the Manager and the Independent Trustees and after approval by a majority of the Independent Trustees.

For purposes of calculating the Base Management Fee, outstanding limited partnership interests in the Operating Partnership (other than limited partnership interests held by the Trust) shall be treated as outstanding Common Shares.

SECTION 2.Conditions Precedent. This Amendment shall become effective on as of the date first set forth above (the “Amendment Effective Date”) subject to the satisfaction of the following conditions precedent:

2.1Delivered Documents. On the Amendment Effective Date, each party shall have received the following documents, each of which shall be satisfactory to such party in form and substance:

(a)this Amendment, executed and delivered by duly authorized officers of the Trust, the Operating Partnership and the Manager; and

(b)such other documents as such party or counsel to such party may reasonably request.

SECTION 3.Representations and Warranties. Each party represents that it is in compliance in all material respects with all the terms and provisions set forth in the Existing Management Agreement on its part to be observed or performed.

SECTION 4.Limited Effect. Except as expressly amended and modified by this Amendment, the Existing Management Agreement shall continue to be, and shall remain, in full force and effect in accordance with its terms.

SECTION 5.GOVERNING LAW . THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

SECTION 6.Counterparts. This Amendment may be executed in one or more counterparts and by different parties hereto on separate counterparts, each of which, when so executed, shall constitute one and the same agreement.

SECTION 7.Conflicts. The parties hereto agree that in the event there is any conflict between the terms of this Amendment, and the terms of the Existing Management Agreement, the provisions of this Amendment shall control.

[SIGNATURE PAGE FOLLOWS]

-3-

IN WITNESS WHEREOF, the parties have caused their names to be signed hereto by their respective officers thereunto duly authorized as of the day and year first above written.

The Trust:	PENNYMAC MORTGAGE INVESTMENT TRUST
By:	/s/ Daniel S. Perotti <br>Name: Daniel S. Perotti<br>Title: Senior Managing Director and<br> Chief Financial Officer
---	---

The Operating Partnership:	PENNYMAC OPERATING PARTNERSHIP, L.P

By: PennyMac GP OP, Inc.,

its General Partner

By:	/s/ Daniel S. Perotti <br>Name: Daniel S. Perotti<br>Title: Senior Managing Director and<br> Chief Financial Officer

The Manager:	PNMAC CAPITAL MANAGEMENT, LLC

By: /s/ David A. Spector Name: David A. Spector Title: Chairman and Chief Executive Officer

Signature Page to Amendment No. 1

Fourth Amended and Restated Management Agreement

Corporate Template

EXHIBIT 10.2 AMENDMENT NO. 1

THIRD AMENDED AND RESTATED

MORTGAGE BANKING SERVICES AGREEMENT

Amendment No. 1 to Third Amended and Restated Mortgage Banking Services Agreement, dated and effective as of June 23, 2025 (the “Amendment”), by and between PennyMac Loan Services, LLC, a Delaware limited liability company (the “Service Provider”), and PennyMac Corp., a Delaware corporation (the “Company”).

RECITALS

WHEREAS, the Service Provider and the Company are parties to that certain Third Amended and Restated Mortgage Banking Services Agreement, dated as of December 16, 2025 (the “Existing MBS Agreement” and, as amended by this Amendment, the “MBS Agreement”). Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Existing MBS Agreement.

WHEREAS, the Service Provider and the Company have agreed, subject to the terms and conditions of this Amendment, that the Existing MBS Agreement be amended to reflect certain agreed upon revisions to the terms of the Existing MBS Agreement.

NOW, THEREFORE, in consideration of the mutual premises and mutual obligations set forth herein, the Service Provider and the Company hereby agree that the Existing MBS Agreement is hereby amended as follows:

SECTION 1.Amendments to Article 1.

1.1Section 1.01 of the Existing MBS Agreement is hereby amended by inserting the following definition in the appropriate alphabetical order:

“Factor” means either .99 or .80 (representing the estimated pull through rate), the amount of which shall be multiplied by each Loan Commitment relating to a Mortgage Loan other than a Ginnie Mae Mortgage Loan depending on whether it is subject to a “mandatory trade confirmation” or a “best efforts lock confirmation,” respectively.

1.2Section 1.01 of the Existing MBS Agreement is hereby amended by deleting the definitions of “Company Loan Commitment”, “Company Purchased Loan”, “Correspondent Lending Program”, “Tier 1 Loan Commitment” and “Tier 2 Loan Commitment” in their entirety and replacing them with the following:

“Company Loan Commitment” means, through June 30, 2025, the number of Loan Commitments relating to Mortgage Loans intended to be purchased by the Company from a Correspondent and thereafter retained by the Company prior to sale or securitization,

and from and after July 1, 2025, the number of Loan Commitments relating to Mortgage Loans intended to be purchased by the Company from the Service Provider, in either case through the Correspondent Lending Program (and after applying the applicable Factor to each such Loan Commitment).

“Company Purchased Loan” means, through June 30, 2025, the Mortgage Loans that are purchased by the Company from an approved Correspondent and thereafter retained by the Company prior to sale or securitization and, from and after July 1, 2025, the Mortgage Loans that are purchased by the Company from the Service Provider, in either case after the issuance of a related Company Loan Commitment and through the Correspondent Lending Program.

“Correspondent Lending Program” means that certain delegated correspondent lending program established by the Service Provider and pursuant to which either the Company or, from and after July 1, 2025, the Service Provider acquires Mortgage Loans that satisfy the terms of the related loan purchase agreement, including the requirements set forth in the applicable Guide(s), and any additional terms or conditions identified in acquisition policies and procedures adopted by the Service Provider from time to time.

“Tier 1 Loan Commitment” means each of the first 16,500 non-Ginnie Mae Loan Commitments (as determined after applying the applicable Factor to each non-Ginnie Mae Loan Commitment) issued by the Company or, as applicable, the Service Provider, to an approved Correspondent during any fiscal quarter.

“Tier 2 Loan Commitment” means each non-Ginnie Mae Loan Commitment in excess of 16,500 (as determined after applying the applicable Factor to each non-Ginnie Mae Loan Commitment) issued by the Company or, as applicable, the Service Provider, to an approved Correspondent during any fiscal quarter.

SECTION 2.Amendments to Exhibit A. Exhibit A of the Existing MBS Agreement is hereby amended by deleting it in its entirety and replacing it with the form attached hereto as Exhibit A.

SECTION 3.Conditions Precedent. This Amendment shall become effective as of the date first set forth above (the “Amendment Effective Date”), subject to the satisfaction of the following conditions precedent:

3.1Delivered Documents. On the Amendment Effective Date, each party shall have received the following documents, each of which shall be satisfactory to such party in form and substance:

(a)this Amendment, executed and delivered by duly authorized officers of the Service Provider and the Company; and

(b)such other documents as such party or counsel to such party may reasonably request.

SECTION 4.Representations and Warranties. Each party represents that it is in compliance in all material respects with all the terms and provisions set forth in the Existing MBS Agreement on its part to be observed or performed.

SECTION 5.Limited Effect. Except as expressly amended and modified by this Amendment, the Existing MBS Agreement shall continue to be, and shall remain, in full force and effect in accordance with its terms.

SECTION 6.GOVERNING LAW . THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

SECTION 7.Counterparts. This Amendment may be executed in one or more counterparts and by different parties hereto on separate counterparts, each of which, when so executed, shall constitute one and the same agreement.

SECTION 8.Conflicts. The parties hereto agree that in the event there is any conflict between the terms of this Amendment, and the terms of the Existing MBS Agreement, the provisions of this Amendment shall control.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the parties have caused their names to be signed hereto by their respective officers thereunto duly authorized as of the day and year first above written.

The Service Provider:	PENNYMAC LOAN SERVICES, LLC

By:	/s/ Douglas E. Jones<br>Name: Douglas E. Jones<br>Title: President and Chief Mortgage <br> Banking Officer
The Company:	PENNYMAC CORP.
---	---
By:	/s/ Daniel S. Perotti<br>Name: Daniel S. Perotti<br>Title: Senior Managing Director and<br> Chief Financial Officer
---	---

Signature Page to Amendment No. 1

Third Amended and Restated Mortgage Banking Services Agreement

EXHIBIT A

(Compensation)

Fulfillment Fees

The aggregate Fulfillment Fees for Mortgage Loans during any fiscal quarter shall not exceed:

(a) the product of (i) the sum of $585.00 for each Tier 1 Loan Commitment and $355.00 for each Tier 2 Loan Commitment, and (ii) the number of Company Loan Commitments divided by the aggregate number of both Tier 1 Loan Commitments and Tier 2 Loan Commitments, the payment of which shall made no later than the end of the calendar month following the calendar month in which such Company Loan Commitments were issued, plus

(b) the product of (i) the number of Company Purchased Loans divided by the aggregate number of both Tier 1 Purchased Loans and Tier 2 Purchased Loans, and (ii) the sum of $315.00 for each Tier 1 Purchased Loan and $195.00 for each Tier 2 Purchased Loan, the payment of which shall be made no later than the end of the calendar month following the calendar month in which such Company Purchased Loans were purchased by the Company; plus

(c) in the case of all Mortgage Loans other than Fannie Mae Mortgage Loans and Freddie Mac Mortgage Loans that are purchased by the Company from an approved Correspondent or the Service Provider during such quarter, in either case through the Correspondent Lending Program, supplemental fees in an amount no greater than the product of (i) $500.00, and (ii) the number of such Mortgage Loans sold and securitized (the “Supplemental Fees”), the payment of which shall be made no later than the end of the calendar month following the calendar month in which such Mortgage Loan was sold or securitized.

No Fulfillment Fee shall be due or payable to the Service Provider with respect to the following: (i) any Ginnie Mae Mortgage Loan; (ii) any Fannie Mae Mortgage Loan or Freddie Mac Mortgage Loan acquired from the Company by the Service Provider pursuant to Section 3.03(b)(xxvi); or (iii) any Mortgage Loan acquired by the Company from the Service Provider on or before June 30, 2025, provided that Supplemental Fees may still be charged in connection with the securitization or sale of any such Mortgage Loans.

For the purposes of this Exhibit A, “mandatory trade confirmation” and “best efforts lock confirmation” shall have the meanings ascribed to them in the PennyMac Guide, and to the extent the Service Provider purchases any Mortgage Loans from the Company during the quarters ending March 31, 2025 or June 30, 2025, or the Company purchases any Mortgage Loans from the Service Provider during any quarter commencing on and after July 1, 2025, such Mortgage Loans shall reflect a representative mix of “mandatory trade confirmations” and “best efforts lock confirmations,” as well as a representative mix of underlying characteristics, by

reference to all of the Mortgage Loans within the related Loan Category(ies) acquired from Correspondents by the Company or the Service Provider, as applicable, during such quarter.

Early Purchase Program Fees

With respect to each Early Purchase Program, through June 30, 2025, the Service Provider shall be entitled to fees that accrue (a) at a rate equal to $1,500 per annum, and (b) in the amount of $35 with respect to each Mortgage Loan purchased by the Company thereunder. The fee described in clause (a) shall accrue and be payable monthly not later than the last Business Day of each month from and after the execution of the Early Purchase Program documentation. The fee described in clause (b) shall accrue and be payable monthly not later than the fifth (5^th^) Business Day following the month during which the related Mortgage Loan first becomes subject to a transaction thereunder.

Exhibit 31.1

CERTIFICATION

I, David A. Spector, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of PennyMac Financial Services, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13(a)-15(e) and 15(d)-15(e)) for the registrant and have:

a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: July 29, 2025

By:	/s/ David A. Spector
	David A. Spector
	Chairman and Chief Executive Officer<br><br>(Principal Executive Officer)

Exhibit 31.2

CERTIFICATION

I, Daniel S. Perotti, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of PennyMac Financial Services, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13(a)-15(e) and 15(d)-15(e)) registrant and have:

a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: July 29, 2025

By:	/s/ Daniel S. Perotti
	Daniel S. Perotti
	Senior Managing Director and Chief Financial Officer<br><br>(Principal Financial Officer)

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of PennyMac Financial Services, Inc. (the “Company”) for the quarter ended June 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, David A. Spector, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge, that:

1.	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Date: July 29, 2025

By:	/s/ David A. Spector
	David A. Spector
	Chairman and Chief Executive Officer<br><br>(Principal Executive Officer)

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to PennyMac Financial Services, Inc. and will be retained by PennyMac Financial Services, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of PennyMac Financial Services, Inc. (the “Company”) for the quarter ended June 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Daniel S. Perotti, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge, that:

1.	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Date: July 29, 2025

By:	/s/ Daniel S. Perotti
	Daniel S. Perotti
	Senior Managing Director and Chief Financial Officer<br><br>(Principal Financial Officer)