Wants and Aspirations in Relation to US Loan Servicing
In the US, loan servicing companies provide an invaluable assistance to lenders and brokers by following up on mortgages. The work involves a process that includes collecting interest, principal, and escrow payments from borrowers.
Most mortgages are backed by the government or by government-sponsored enterprises (GSEs) such as Fannie Mae, Ginnie Mae, or Freddie Mac. The GSEs and private loan investors typically do not service the mortgage loans they purchase, so the banks generally retain the right to service the loan. Servicers may, among other requirements, take care of impounds, collections, statements, tax reporting, etc.
Servicers are right at the middle, extending assistance to all involved parties. Since they are entrusted with the terms of the loan, they have to work with both the lender and the borrower to ensure that things go swimmingly and everybody is in full compliance with the terms. In providing assistance to borrowers, the servicer takes responsibility for sending monthly statements and collecting payments, delivering year-end statements as well as tax forms, and contacting them in case there seems to be a problem with their account. Servicers may also perform tax and insurance impounding as well as pay off due bills.
The qualities of one servicer vary from those of the next, so lenders and brokers should be careful to choose a company that is staffed with passionate and professional individuals, providing personalized service so that clients have a better chance of successfully achieving their goals.
What do lenders and borrowers typically want from US loan servicing companies? For starters, they want a service that can collect and make payments on behalf of clients faster. It would also be ideal to find a company that can get documents done with fewer touches and commit fewer mistakes overall. To avoid any propensity for human error, it’s best if the servicer has automated its systems and processes. All in all, the company should serve as the primary point of contact for both sides—a service that understands that sometimes back-up is the only option. It is also a reliable, trustworthy, and free resource for questions, even legal ones.
Borrowers have certain aspirations in their lives and loans are sometimes the only means through which they can attain them. Some intend to use their funds for grown-up toys such as vintage cars, socializing at fun events such as galas and concerts, traveling, retirement, investing in property and earning a residual income even if they’re pretty much absentee owners, etc. With an excellent servicer working on their loan, they can better meet and manage its terms so that both they and the lenders can benefit from it.