Mortgage servicers are companies responsible for the logistical aspects of servicing a loan. Things like processing and tracking payments, sending payment reminders and filing foreclosure documents are some of the tasks they perform.
Your mortgage servicer helps handle your loan, but also satisfies certain federal requirements. For example, your servicer sends a report each year describing your accounts balances, property tax payments, homeowners insurance and other pertinent account activity.
Sometimes, your loan servicer might change financial institutions. When this happens, servicers are required to notify you within 30 days of your mortgage transfer.
The mortgage loan industry involves three key players: mortgage lenders, investors and servicers.
The lenders, or originators, are banks or mortgage firms that give you the money when a home loan was approved for you.
A mortgage investor is a person or organization - often a government-sponsored entity - that buys the entire mortgage from the originator. This allows the lender to sell additional mortgages.
Finally, the servicers are companies handling your loan account. In some cases, the loan owner - whether a lender or investor - can also be a servicer. However, borrowers are usually connected with a third-party company to help manage repayment.
Having a quality loan servicer can make a huge difference in your borrowing experience. An excellent company maintains accurate information, is quick to contact and offers good customer service. Their important duties include canceling mortgage insurance, assisting in avoiding foreclosure or answering general queries.
Unfortunately, you have no control over who can buy and service your loan. The lender’s right to sell to an external company is included in the terms of service you have to agree to when signing up for the loan.
These are only a few of the important aspects of mortgage servicing to know. However, the more you understand about the parties involved, the better borrowing experience you’ll have.
Linda Costanzo is a Real Estate sales professional with several years experience. Linda prides her business on a loyal client base of referrals..."I devote myself to serving the needs of my clients before, during and after each transaction." Linda is a responsible, organized and motivated individual. She will make your real estate experience enjoyable while ensuring that your every need is met. Whether you're buying, selling or just have real estate questions, Linda will be there to guide you through the process. Linda currently resides in Boston and specializes in...
