Mortgage lenders are financial groups that consist of different investors that let people borrow money from them to buy or refinance a home. A mortgage service takes care of the administration of this loan until the person who borrowed pays it off in full. Most mortgage lenders don’t offer loans that are big enough to deal with loan servicing and still make a profit. Mortgage lenders will help process the loan, fund the mortgage and draw up the documents. Mortgage servicers will track your payments and manage escrow accounts.
- Lenders handle mortgage loan tasks such as applying, processing, funding and closing.
- Servicers take over from lenders and process your payments, generate tax forms, etc.
- You don’t get to choose who services your loan, but if problems arise, you can contact the CFPB.
“Once the loan closes, it will require ongoing administration, or servicing, until it’s paid off, so many lenders transfer mortgages to loan servicing companies.”