What Is the Difference Between a Servicer and a Mortgage Holder?

Mortgage holders and mortgage servicers perform different duties with respect to a mortgage. A mortgage holder usually acquires the loan from a bank, financial institution, or other lender, thereby becoming the legal owner of your mortgage. The mortgage holder is then your creditor and the recipient of your mortgage payments.

On the other hand, a mortgage servicer is responsible for handling the day-to-day tasks associated with mortgages, such as collecting payments, managing escrow accounts, communicating with borrowers, managing the property (if applicable), collecting PMI, and fulfilling other duties.