What Is Auto Loan Servicing?

Auto loan servicing starts after you've opened a loan. It includes everything involved in loan maintenance.
Funto Omojola
By Funto Omojola 
Edited by Julie Myhre-Nunes

Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money.


Auto loan servicing refers to the process of managing a loan, which includes processing and tracking monthly payments, until the loan has been paid off.

Loan servicing applies to the process of managing other types of loans as well, including mortgages and personal loans. But there are some details about the servicing process for auto loans that can be different from that of other consumer loans.

Here's what to know about auto loan servicing.

Understanding auto loan servicing

Auto loan servicing is the next step after auto loan origination. It includes the entire process of maintaining a loan — everything from managing monthly statements to tracking and recording monthly payments and fielding borrower inquiries.

For example, if you want to make a payment date change or are having difficulty making payments, you should contact your loan servicer.

Compare auto loans

How does auto loan servicing work?

Auto loan servicing affects where you will make auto loan payments or direct questions about your auto loan.

Sometimes auto loan servicing is done by the same financial institution that issues the loan, like a bank or credit union. In this instance, the same entity that issues the loan also manages the loan until it's paid off.

Alternatively, some companies make auto loans and then pass or sell the servicing to a third party. Examples could be:

  • You get an auto loan at a bank or credit union, but an outside servicing company takes over as you pay off the loan.

  • You work with a loan aggregator that matches you to a loan within a network of lenders. The lender you are matched with takes over all servicing of your loan.

  • You get a loan at a car dealership and the loan is through an automaker’s financing arm, also called a captive lender. You may feel that you’re getting the loan from the dealer though it’s actually being issued by a captive lender that keeps the servicing.

Because aggregators work with a network of lenders, they are more likely to pass servicing to the lender. Regardless of where you obtain your initial loan approval, the process of your loan servicing passing to another party is usually seamless.

If a lender passes your loan servicing to another party, you can typically expect to receive a note from your lender or servicer with information about your loan terms, who your servicer is, how to contact them and how to make payments.

Get more smart money moves – straight to your inbox
Sign up and we’ll send you Nerdy articles about the money topics that matter most to you along with other ways to help you get more from your money.