This is a single-family/residential course.
Mortgage bankers generate substantial income by servicing loans on behalf of investors. In this course, we will learn about the various functions of servicing and how loan servicing can be a valuable revenue-generating asset. We will also learn about the goals and structure of a loan administration division, the risk associated with loan servicing, and the regulatory environment.
Loan Administration Basics begins with an overview of the major areas and goals of loan administration as well as ways through which loan administration makes money, including servicing fees and float income.
From there the course looks at the structure of the department and the roles of the major functional areas of a loan administration group.
- Customer Service. This group is comprised of new loan setup, the call center, complaint resolution, payoffs and assumptions, and special products.
- Escrow Administration. This department handles the borrower's escrow accounts, computes the annual escrow analysis, and ensures the property taxes and insurance are paid.
- Default Administration. This area of loan administration deals with foreclosures, collections, and loss mitigation.
- Mortgage Accounting. This division is responsible for cash processing, compliance and auditing tasks, as well as investor accounting.
Next, the course looks at how a servicing asset is valued and traded by determining the value of the mortgage servicing rights. It discusses the types of servicing sales, and market trades that influence future interest rates. Finally, the course reviews the major laws and regulations that affect loan administration and the regulators that enforce them. Sprinkled through the course are interviews with an expert in loan adminstration for real world information and insight.
Note: The terms "loan administration" and "servicing" often are used interchangeably. Within the mortgage banking industry both terms describe the administrative and financial tasks associated with the daily management of closed mortgage loans. Regardless of how the function is titled within your organization, the loan administration function handles all activities related to the loan once the loan has been closed.
- Goals of Loan Administration
- Sources of Revenue
- Loan Administration Organizational Structure
- Customer Service
- Escrow Administration
- Default Administration
- Mortgage Accounting
- Valuation and Trading
- Complying with Regulations
Seat time approximately one (1) hour.