Generally, a company earns a servicing fee when it retains the servicing of a block of loans in which it has sold all or part of the block. Service fees received from sales of participations are recorded as:

Question

Quizplus · Accepted Answer

Service fees received from sales of participations are recorded as gross income and not netted against interest income remitted to the acquiring party, as they represent a separate revenue stream for the company.

Generally, a Company Earns a Servicing Fee When It Retains