Because mortgage loans are constantly bought and sold, the original lender approving the loan may not be the same lender holding the loan. Banks, credit unions, and mortgage companies approve a large quantity of home loans. Due to small resources, it becomes impossible for lenders to continue holding the mortgage, while approving new loan requests. For this matter, mortgages are sold to secondary markets or other lenders. In some cases, the homebuyer is unaware of the transaction.

Even if the lender no longer holds the loan, the borrower may continue to remit payments to the original lender. Lenders who receive mortgage payments once the loan is sold are called servicing lenders.

Servicing lenders provide a value service. When monthly mortgage payments are received from the borrower, the serving lender is responsible for recording the payment, maintaining accurate payment records, providing statement accounts, charging late fees, and attempting to settle delinquent accounts. Because mortgage providers or secondary mortgage markets are primarily concerned with buying mortgage notes, they do not have time to handle smaller details about each account.

The quality of servicing lenders is often a topic of debate. Unfortunately, borrowers have no control over which lender will service their account. In fact, a mortgage loan can receive a new servicing lender, without the borrower being notified. If the servicing lender is providing quality service (recording mortgage payments on time, submitting timely statements) borrowers have no reason to complain.

If the servicing lender provides poor service, this may result in an inaccurate payment record. Borrowers may not detect errors until receiving an annual statement. Even if a servicing lender makes several mistakes, borrowers cannot request a new lender. The option for acquiring a new servicing lender involves refinancing the home loan.