PSI Oklahoma Real Estate Practice Test

Which entity does not typically service loans?

1. Banks

2. Credit unions

3. Mortgage brokers

4. Loan servicing companies

The correct answer is: Mortgage brokers

Mortgage brokers typically do not service loans; instead, their primary role is to act as intermediaries between lenders and borrowers. They help borrowers find suitable mortgage products and connect them with lenders but do not manage or service the loans once they are closed. In contrast, banks, credit unions, and loan servicing companies are directly involved in loan servicing. Banks and credit unions often originate and service their own loans, managing the day-to-day administrative processes such as collecting payments, managing escrow accounts, and handling customer inquiries. Loan servicing companies specialize in managing loans on behalf of lenders, providing the necessary infrastructure for tracking payments and managing borrower accounts. Therefore, the distinction lies in the fact that mortgage brokers focus on the initial loan application and approval process rather than ongoing servicing.