Servicer is the entity responsible for collecting mortgage loan payments, managing escrow accounts, and handling customer service inquiries.
In the context of mortgage loans, a servicer is an entity or company responsible for various tasks related to the administration of the loan. These tasks typically include:
Collecting Payments: The servicer collects the monthly mortgage payments from the borrowers on behalf of the lender or investor who owns the loan. This includes keeping track of the payment amounts, and due dates, and ensuring that payments are credited to the borrowers’ accounts.
Managing Escrow Accounts: Many mortgage loans include an escrow account, which is used to hold funds for the payment of property taxes, homeowners insurance, and possibly other expenses related to the property. The servicer is responsible for managing these escrow accounts, which involves collecting funds from the borrowers as part of their monthly payments and disbursing the necessary amounts to cover the relevant expenses.
Customer Service: The servicer acts as the primary point of contact for borrowers regarding their mortgage loan. They handle inquiries and provide assistance to borrowers regarding various aspects of their loan, including payment-related questions, account inquiries, and any issues or concerns the borrower may have.
It’s important to note that the servicing of mortgage loans can be transferred or sold to different servicers over time, so borrowers may interact with different servicers throughout the life of their loan.