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Mortgage servicing

Mortgage servicing is the process of overseeing the entire lending process such as collecting monthly payments, managing defaults, etc.

Expanded Definition

The mortgage service company is the one who receives your payments, and credits them to your account. They are the ones who answer any quesitions that come up. If you make additional payments on your mortgage, they are the ones who decide where to credit that money and whether the payment goes into the escrow account or against your principle. If you prepay the loan, they are also the ones who determine if a penalty is due.

They also monitor your credit status and overdue mortgages. They decide when to take action and what action to take. Will they hire a collection agency? Will they foreclose?

Estabishing a working relationship with your mortgage servicing company is good practice. Good communications can help resolve the issues if a problem arises. If you have a problem, call them sooner rather than avoiding them.

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