U.S. Mortgage Index

What is the difference between a mortgage lender and a mortgage servicer?

Short answer

A mortgage lender originates or makes the loan. A mortgage servicer manages the loan after closing: it sends statements and handles day-to-day administration. After closing, a different company often takes over servicing.

Full explanation

The is the institution that originates or makes the loan. The servicer is the company that manages the loan after closing. You can usually find the servicer on the monthly statement or payment coupon book.

It is common for a different company to take over servicing after origination. The servicer typically processes payments, answers questions, tracks principal and interest paid, and manages a tax and insurance escrow account if you have one.

This is a role difference, not a quality ranking. Who owns the loan, and what happens if ownership or servicing is sold, is covered in the separate loan-sale FAQ.

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