So the mortgage is bundled and sold as a securitized instrument in tranches, etc. That explains the contract side of a mortgage. When an individual makes a monthly payment on that mortgage, how does the money for that specific mortgage find its way to its rightful creditor? This question is about the money side of a mortgage backed security.
The money is paid to investors who bought those mortgage backed securities. The company that services those loans is responsible for making sure the money is paid to the right investors