Document governing how pooled mortgage loans are serviced and administered for an MBS transaction.
A pooling and servicing agreement, often shortened to PSA, is a document that governs how pooled mortgage loans are serviced and administered for a mortgage-backed security transaction.
Pooling and servicing agreement matters because borrowers often see only the servicer, while the loan may sit inside a larger investor structure. The PSA is one of the documents that can define duties and rules behind that structure.
The term also matters in servicing and default contexts. Borrowers may hear references to investor rules, servicing authority, or trust requirements without seeing the full investor documents directly.
Borrowers rarely review a PSA during normal application or closing. The term is more likely to appear later if there is a servicing dispute, default issue, investor question, or explanation of how a securitized loan is administered.
The borrower-facing takeaway is simple: a servicer may be following investor or trust rules that sit behind the account, even though the borrower still interacts with the servicer.
| Term | Main role |
|---|---|
| Mortgage Pool | Group of loans backing a transaction |
| Pooling and servicing agreement | Governing document for administration and servicing of the pool |
| Mortgage Servicer | Company handling borrower account administration |
| Master Servicer | Entity overseeing broader servicing administration for a pool |
| Mortgage Servicing Rights (MSR) | Rights to service the loan and receive servicing compensation |
A borrower’s loan is part of a securitized pool. The borrower sends payments to the servicer, while the PSA helps define how the servicer must administer loans in that pool for the transaction.
Pooling and servicing agreement differs from Mortgage Servicing Rights (MSR) because MSR describes the servicing asset or rights, while the PSA is a governing agreement for the pooled transaction.
It also differs from Servicing Transfer. A servicing transfer is a borrower-facing change in who collects payments; a PSA is a behind-the-scenes investor document.
It also differs from Master Servicer. The PSA is the governing document, while the master servicer is an entity operating under the servicing structure.