Loan Servicer

Definition - What does Loan Servicer mean?

A loan servicer is a company—such as a bank, mortgage or service company—that provides loans and collects the payments and interest on those loans into the future and for the length of the loan.

The loan servicer is the place that collects the payments of any loan, but is usually the actual company that lent the money, unless the debt falls into arrears and is sent to a debt servicing company. There are many legal requirements that a loan servicer must follow and they must keep a written account of all discourse and payments made in any loan.

Justipedia explains Loan Servicer

A loan servicer will be required by law to limit the repayment demands to align with the terms of the contract. They will continue regular servicing unless the borrower falls into arrears, in which case they will follow legal regulations that dictate how the servicer can attempt to collect the debt and how long they have to continue the process before furthering it in a different manner, such as court action.

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