RC_LA_EA_200.1 Escrow in Loan Servicing

Escrow in Loan Servicing describes the escrow administration function within the loan administration department. The course begins with a look at the three major components of the lending cycle: loan production, secondary marketing, and loan administration. It then outlines three primary risks of mortgage lending—borrower default, property damage, and tax sale—and illustrates how maintaining escrow accounts mitigates these risks. Next, the course defines escrow and describes how it is used to protect the lender's interests. The course then reviews the three major components of escrow accounts: mortgage insurance, property insurance, and property taxes. Finally, the advantages and disadvantages of escrow to the lender and to the borrower are described.

This is a single-family/residential course.

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