 Samantha
Community Mentor
Joined: 16 Sep 2005
Posts: 1606
Location: MASSACHUSETTS
150.38 Dollars($)
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 Posted: Sat Oct 08, 2005 1:34 am Post subject: RE: |
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Hi Frank
Loan servicing includes the services performed by the lender after the closing of the mortgage. These include collection of the monthly payments from borrowers and dealing with late payments or default in the monthly payment.
The lenders process the payments, send statments, withdraw money from the escrow account and make payments towards the taxes and insurances related to the mortgage. They also handle pay-offs and assumptions and offer collection services on delinquent loans.
Thanks,
Samantha. |
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Caron
Moderator
Joined: 19 Jul 2005
Posts: 1562
Location: florida
266.68 Dollars($)
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| Posted: Sat Oct 08, 2005 2:42 am Post subject: RE: |
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Hi Frank
Here are some more details on loan servicing.
At closing the lender may inform the borrower if he wishes to hand over the rights to administer the loan to a mortgage servicer, as is the case when a mortgage is sold. The new servicer may be a lender, a bank, an investor or a loan processing company. The loan servicer has the following responsibilties.
- Collect and process the monthly mortgage payments.
- Hand over the payments to the investor who owns the loan. The servicer acts on behalf of the investor in case of any problems in the mortgage deal.
- Pay property taxes and homeowner's insurance from the borrower's escrow account.
- Send the borrower an annual statement regarding what part of the interest, principal, taxes and insurance are applied towards the monthly mortgage payments. The statement also confirms if any adjustments are made to cover the taxes and insurance in the coming year.
- The servicer also assists the borrower to overcome delinquencies in case the latter misses any monthly payment.For instance, he may extend the repayment period or reduce the monthly payments or else he may also accept late payments. But in case of serious default, the servicer may conduct a foreclosure to protect the investors interest in the property.
Hope this will help you.
Regards,
Caron. |
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