What Are Some Features of a Cenlar Home Mortgage?


Quick Answer

Cenlar is subservicer of mortgage loans and does not offer direct financing to potential borrowers, explains the The Mortgage Insider. Cenlar, which stands for Central Loan Administration and Reporting, services more than $200 billion in mortgages as of 2015.

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Full Answer

The core of Cenlar’s business is servicing mortgage loans for banks and lenders that offer mortgage financing, according to The Mortgage Insider. Servicing mortgage loans includes billing borrowers each month for mortgage payments, collecting payments and offering borrowers the opportunity to apply for loan modifications if they are in default on their mortgage loans. However, Cenlar cannot approve loan modifications; banks and lenders must approve loan modifications. Once the lender approves the modification, Cenlar handles the default management process, including processing the modification, collecting new payments and updating the new amortization schedule.

Cenlar also handles account payoffs, cash management, escrow administration and regulatory compliance reporting. As of 2013, Fitch ratings stated that Cenlar is the most active participant in the servicing of retail mortgage-backed securities issuances. The company doubled the size of its loan servicing portfolio to 1.2 million loans, according to Cenlar. Cenlar originally operated as a traditional mortgage finance company but changed its business model to subservicing mortgage loans in 1994.

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