RC_LA_CM_200.1 Cash Flow

The homeowner’s monthly mortgage payment is typically divided into several components, with different parties entitled to specific portions of the funds. Depending on the loan structure and borrower instructions, the flow of cash may be as simple as a direct reduction in principal or as complex as a distribution to multiple investors, government agencies, insurers, and escrow payees.

In Cash Flow, we examine the movement of funds from the borrower to the servicer and ultimately to the investor or other recipient. The course begins by identifying the elements that make up a typical mortgage payment. Next, we explore the methods by which payments are submitted to the servicer—such as ACH drafting, wire transfers, and lockbox payments—and how funds are deposited and routed. Finally, we review the two primary types of accounts used to manage these funds: custodial and corporate accounts.

This is a single-family/residential course.

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