In one sentence
A servicer performing servicing functions on behalf of the primary servicer or lender under a subservicing agreement.
The longer version
Lenders and servicers outsource some or all servicing to sub-servicers with the systems and staff to do it at scale. The primary retains the relationship; the sub does the work.
The subservicing handoff is another point where loan files must transfer cleanly, with complete data and documents.
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