6 Answers About Leveraging AI in the Mortgage Ecosystem

Recap of The Mortgage Collaborative Blog

In the recent webinar hosted by The Mortgage Collaborative, our Senior Solutions Advisor, John Heck, moderated and asked a few hard-hitting questions that can give lenders the answers they need to leverage AI technology throughout the mortgage ecosystem. Jim Albertelli, CEO of Albertelli Law, and Katherine Campbell, Chief Digital Officer at Assurance Financial answered these questions with thoughtful consideration of the current mortgage ecosystem and their predictions of the future. Watch the webinar for the complete answers and dialogue between the leaders. 

What are the benefits of adopting an AI-driven process to streamline and standardize data?

“Mortgage companies develop so much information in databases on the borrowers they interact with and collect trends that might be hard to spot on a micro level, but AI allows you to aggregate it all,” said Jim.

Jim described AI-driven processes as algorithmic, which led him to explain that, “the if-then statements of an algorithm can help digest, standardize, and break down data, so you’re effective and efficient.” He also noted that AI systems provide insights that individuals can’t manage on spreadsheets because databases are too large. 

With everything going on socially, Jim also pointed out the benefit of using AI to provide transparency and inclusion for borrowers. Lenders that use rule engines to run initial analyses on borrowers can eliminate biased ways of ingesting data in this initial analysis because AI uses simple equations to qualify an individual. 

How did Assurance Financial implement AI to proactively address the unplanned COVID-19 pandemic?

According to Katherine, “Just 18 months ago, having a point of sale system was how people defined a digital mortgage.” However, this unplanned pandemic has shown the importance of quickly communicating with borrowers.“ Time is money in this industry and the pace of communication must be much faster today.”  

“At Assurance Financial, we’re well into adoption with an end-to-end solution including e-closing and e-notes,” said Katherine. “But we realized that it’s very critical that we use some of the most simplistic integrations to make streamlined communications possible.”

Why is it important to automate your helpdesk, processes, and decision making?

Jim shared that he goes through more than 100 audits by financial institutions a year. This led him to think about how to create a better track record, preserve metadata, track information from calls, and provide agents with the same requisite knowledge across the product suite. 

If you’re looking to support a call center, “AI allows you to keep a knowledge base that has all the rules and regulations up to date at all times, retain metadata for compliance, communicate with people in the channels that they want to be spoken to in, and digest rules,” said Jim.

At Albertelli Law, “We’re deploying AI to guarantee transparency, to do a better job communicating with borrowers, be more effective, perform better analyses, and maintain metadata for that analysis.” However, Jim wanted the listeners to leave with two things.“One, AI is not over your head and two, you already have the data, you just need to use it.”

John reiterated the importance of using tech in today’s industry by sharing how easy it is to “compete with the big players by controlling your marketplace, gaining efficiencies with data driven digitized environments, and bringing in micro-service providers to uplift your systems of record.” John predicted that if you’re not doing business in a digitized data-driven environment, it will be very difficult to survive. 

How can AI be implemented into the loan fulfillment process to reduce the overall costs and deliver better customer service?

For external customers, “what might have been a surprise and delight a year ago is now an absolute expectation,” said Katherine. Because of this rapidly changing expectations of capabilities, Katherine shared that it’s important to think about experience over transaction,” to offer a better borrower experience than they had last time. 

To begin anticipating ROI begins with measuring engagement from the initial visit to conversion, and then looking at how to get down the actual cost per funded loan (CPFL). “When you have an engaging AI-tool like Capacity on your website, you can answer customer questions and drive them through the funnel so seamlessly that they don’t even notice,” shared Katherine.

Why is it critical to automate your processes associated with forbearance, loss mitigation, default management, and bankruptcy/foreclosure optimization?

Monitoring a borrower’s financial information, verification of employment, and credit score can help lenders confirm a refinance, deferment, or loan modification request or form outreach if you see a borrower is falling behind in any of the above areas. By using machine learning, your technology can also begin to provide predictions as well.

“We’re seeing AI lead to better decisions from the standpoint of engagement, or the money making jobs that can help you see ROI,” said Jim. 

In addition to using AI for decision making, Jim shared that lenders can also use AI to effectively communicate with people who need support and weed through all of the high volume of loans, requests, and rejections. By reviewing the information, lenders might see the opportunity to “bring loans back to life and enhance profitability,” said Jim. 

Since so many of the lenders are locked into their LOSs, can you offer some suggestions for how AI can be used in parallel to their LOSs wherein efficiency, cost reduction, and increased productivity can be realized?

“Without looking at any one LOS specifically, it’s amazing to see the lack of responsibility these companies have taken to trend with technology,” shared Katherine. “If the lowest common denominator across your team is the LOS’s inability to optimize faster, it’s time to look at the other options.”  

Katherine encourages lenders to avoid feeling overwhelmed or at fault for the inefficiencies, and she recommends lenders to review the expenses that are tied to it before removing yourself. If the price is too high to cut ties, AI-powered tools can help. 

“One of the coolest things about Capacity is that it has the ability to connect the dots for you. If you can bypass the LOS for information and only include relevant information that is a direct spoke into this knowledge base, then you don’t need to cut it out.” 

When you integrate your LOS information with an AI-powered tool, it doesn’t have to be the core source of knowledge, but it can support the decisions and functionality. 

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