Lenders are starting to personalize the borrower journey more than ever, and most of that is due to the adoption of new technology. Automation and artificial intelligence (AI) streamline processes and help personalize the borrower experience.
Enhancing this further is the use of automation and machine learning to gather data on potential borrowers. Having these metrics available makes mortgage origination more targeted and faster in the long run.
How are mortgage lenders using this tech? The process centers on finding the right management platforms employing AI and automation processes.
Speeding up mortgage origination.
One of the biggest problems with humans handling mortgage origination is the risk of applications getting too backed up. Millions of people are still buying homes, and that can mean a mountain of mortgages to underwrite.
When those backups occur, it only slows down finalizing loans for home buyers. This also makes borrowers potentially lose trust in their lenders for not having a more efficient process.
To amend this, more lenders are turning to AI and automation to create a faster pace. It works by having a platform available that can automate many of the laborious tasks humans once did manually to process loans.
Machine learning is at the helm since it “learns” how to research and communicate with borrowers. As it acquires knowledge, the AI becomes smarter and more sophisticated in how it processes information.
Adding intelligent chatbots.
Along the borrower’s journey, numerous questions are going to come up. Some of those questions can be complicated, requiring an expert response. However, with so many questions coming in, it can overwhelm a human team working the phones.
Financial questions are almost always complex and may require a long answer. Lenders are starting to realize overburdening their lenders only leads to burnout. More sophisticated chatbots are helping borrowers get their answers instantly, 24/7.
At the core of this is new technology allowing chatbots to become more intelligent in how they “chat” with borrowers. Natural Language Processing (NLP) is one of the new technologies behind this, and it’s revolutionizing how all lenders communicate with clients.
Thanks to NLP, a chatbot communicates with clients just like a real person and answers most pertinent questions just as intelligently. Sometimes it’s impossible to tell whether the bot is a real person. More intelligent chatbots are only one part of how lenders change borrower experiences.
Utilizing machine learning.
One of the biggest transformations for mortgage lenders is speeding up the underwriting process. Researching the financial background of each borrower can take up to almost two months in many circumstances. Many borrowers are left waiting around for their loans to close due to the backup from human employees.
The use of machine learning is now allowing lenders to automate the underwriting process once and for all. Now, AI can respect a lender’s data and process it in new ways. It also means AI can research the backgrounds of clients much quicker and more efficiently without making mistakes.
Since machine learning is all about AI getting smarter and smarter, the data it acquires about borrowers becomes useful later. As it learns more about borrower data, it can intelligently use that data in the future to find information in a hurry.
Lenders still have to deal with competition, so having machine learning speed up the underwriting process makes for happier clients. At the same time, you take away a major burden from your staff, and you decrease the risk of burnout.
Pairing humans with AI.
Perhaps some lenders find it controversial to utilize AI, and they worry that they could potentially be replaced by AI. In the mortgage industry, it’s still about AI helping humans be able to focus on more important tasks.
Anyone who works in the mortgage industry knows many tasks can become overly laborious without some assistance. AI is merely helping mortgage companies alleviate those repetitive tasks that consume a lot of time and energy.
To make this work at a higher level, mortgage companies are starting to use Human in the Loop technology (HITL), for which humans are still proven essential. In this tech scenario, borrowers are sent to a human through live chat or a ticketing system if the AI chatbot can’t answer a particular question.
Many borrowers have unique questions that AI can’t always answer thoroughly. When this happens, humans are brought in to answer them. It’s another example of how humans and bots can work in harmony together without humans losing their jobs to them.
Instantly access lending guidelines.
It once was that mortgage companies had to go through more complicated means to contact sources like Fannie Mae and Freddie Mac. Finding out lending guidelines is made easier with automation tools.
Being able to instantly access Fannie, Freddie, USDA, FHA, and VA guidelines makes the lending process so much easier than it ever was. Automation programs look up these guidelines on behalf of the mortgage company.
Imagine the difference this makes compared to past decades when lenders had to contact these sources manually to get guideline updates. Many automated programs come with pre-populated knowledge packs to provide instant information about these guidelines when needed.
Improving onboarding for new employees.
Automation technology does more than just help borrowers. It’s also helping new employees in mortgage companies. In the realm of onboarding, this means being able to help them gain information faster about their new roles.
Prior to that, training would require the commitment of human trainers to provide them the knowledge they needed to succeed. AI works like a human brain that can provide all the knowledge new hires require.
As a support resource, this is also invaluable to new employees so they don’t have to bother busy employees with questions in their first week on the job and beyond.