Well, that settles it. After what must have been some interesting boardroom discussions, Two Harbors Investment Corp. (TWO) has made its choice. The company is merging with CrossCountry Mortgage, leaving its previous suitor, UWM Holdings Corporation (UWMC), with a breakup fee and a new plan.

Shares of TWO were trading lower on Friday as the market digested the news. Here’s how the deal shakes out.

If you’re a common shareholder of TWO, you’ll get $10.80 per share in cash when the merger closes. If you hold the company’s preferred stock, your shares will be redeemed at $25.00 a pop, plus any accumulated dividends you’re owed. Not a bad payday, assuming everything goes through.

And when will that be? The companies are eyeing the second half of 2026 for the closing, pending the usual regulatory nods and a thumbs-up from TWO’s stockholders. Once the ink is dry, TWO’s common stock will say goodbye to the New York Stock Exchange. It will become a wholly owned subsidiary of CrossCountry, operating behind the scenes.

The big idea here is to stitch together a complete mortgage operation. CrossCountry gets TWO’s portfolio of mortgage servicing rights, and TWO gets folded into CrossCountry’s retail origination platform. It’s a strategic marriage meant to create a more formidable player. As of the end of December, TWO was sitting on a cash pile of $842.3 million, which certainly doesn’t hurt the combined entity’s balance sheet.

Of course, this new deal means the old deal is off. Two Harbors is formally terminating its merger agreement with UWM, which was dated December 17, 2025. As part of the terms, CrossCountry—on behalf of TWO—will write a check to UWM for a $25.4 million termination fee. Consider it the cost of changing your mind.

Ron Leonhardt, Founder and CEO of CrossCountry Mortgage, was clearly pleased with the move. He stated, “This transaction further solidifies CCM’s position as a one-of-one player in the mortgage market, with the #1 retail origination platform for the third year in a row and the #6 non-bank servicing platform with over $370 billion in unpaid principal balance.”

Looking ahead, Two Harbors is scheduled to provide its next financial update on April 27, 2026. The current analyst estimates are for earnings per share of 25 cents (up from 24 cents year-over-year) and revenue of negative $9.52 million (an improvement from negative $20.33 million YoY).

The overall analyst consensus on the stock is a Hold, with an average price target of $14.15. Recent moves include JP Morgan maintaining a Neutral rating but lowering its target to $12.50 on February 4, UBS downgrading to Neutral while raising its target to $14.00 on January 23, and Maxim Group downgrading to Hold back on December 18, 2025.

For ETF investors, TWO’s presence in a few funds is worth noting. It carries a 4.03% weight in the Invesco KBW High Dividend Yield Financial ETF (KBWD), a 2.77% weight in the GraniteShares HIPS US High Income ETF (HIPS), and a 2.63% weight in the WisdomTree Alternative Income Fund (HYIN). Because of these significant allocations, any major inflows or outflows for these ETFs could trigger automatic buying or selling of TWO shares in the market.

As for the stock’s immediate reaction, Two Harbors shares were down 2.15% at $11.15 at the time of publication on Friday.