What are mortgage server banks?
Mortgage server banks act on behalf of mortgage companies and their borrowers to receive payments and process principal, interest, tax and insurance payments.FunctionMortgage banks and companies that focus on sales and packaging of mortgage loans turn to mortgage server banks to handle loan administration. Mortgage server banks are paid by these lenders for this service.ResultsOnce a loan is closed, the lender alerts the borrower they will making their payments to a servicer. The server bank sends a Welcome Package to let the borrower know about their payment options and policies.ConsiderationsEach month, when payment is received by the server bank, it will pay the principal and interest portion of the payment to the lender. One 12th of the yearly tax and hazard insurance payments are collected and placed in an escrow account. The server bank will then pay the taxes and hazard insurance as they become due. If the loan has mortgage insurance, the server bank will also pay this premium e
