5 Predictions For How AI Will Change The Mortgage Industry In The 2020s

5 Predictions For How AI Will Change The Mortgage Industry In The 2020s

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Artificial intelligence is quickly evolving the way lenders manage resources, support employee functions and interact with borrowers. Over the next decade, it’s likely that intelligent technologies will touch every aspect of the lending experience.

According to a joint report from Roostify and Forbes, over half (56%) of mortgage executives agree that AI technologies are revolutionizing key processes. From productivity gains to enhanced customer satisfaction, AI is poised to bring mortgage lending roaring into a new era. Here are five predictions for how AI will benefit lenders over the next decade:

1. AI will become more integrated with loan tools

The potential benefits of AI for the mortgage industry are far-reaching, and there are many solutions in development or early phases of implementation that will continue to mature in the coming years. Though lenders may be experimenting with a small number of AI-powered tools today, it’s likely that AI and robotic process automation will get baked into nearly every aspect of the mortgage lending experience.

Importantly, AI solutions will benefit lenders and borrowers alike. Internally, AI-powered tools will help loan officers do more and focus their efforts on complex, value-adding work. Externally, AI and machine learning will help to create streamlined, personalized experiences across the customer journey. Essentially, if a tool doesn’t have an AI component today, it will become a target for intelligent optimization in the near future.

2. The workforce will become more productive

Across industries, leaders are looking to AI to enhance the productivity of human workers. Rather than replacing labor altogether, AI solutions will augment the capabilities of workers who are currently limited by rote, tedious tasks. Automation will reduce the number of manual underwriting tasks, generating cost savings for lenders. Ultimately, AI will automate repetitive tasks so that human workers can spend more time on things AI can’t do, like concentrating on more complex loan conditions rather than making sure birthdates match between records.

Human workers may need to up-skill or re-skill as a result of AI taking on more tasks, but the hope is that complex work will be more rewarding. Rather than spending hours every day moving data between systems, employees will be able to put their creative thinking skills into practice. In addition, AI can move data much more quickly and efficiently, limiting the risk of keying errors. This will give human workers more confidence in their data so they can make better decisions decisively. 

3. Lenders will be more insulated against crises like COVID-19

The COVID-19 pandemic disrupted the home lending market, as it did nearly every industry. The crisis revealed a number of gaps in how businesses maintain continuity. Specifically, companies that were able to shift to work-from-home arrangements were much more resilient than those that could not manage their operations remotely.

This is another area in which AI can help businesses react to unique and unpredictable challenges. In fact, 42% of digital leaders believe that lenders that pursue AI in earnest will be better positioned to operate in a post-COVID-19 environment. By digitizing processes, and then optimizing them with AI-powered insights, lenders can maintain strong operational efficiencies under any circumstances.

4. The customer experience will become more personalized

Behavioral analytics will help lenders to better understand how customers engage with their company online. Within three years, 42% of digital leaders expect their firms to use advanced analytics to optimize workflows and build more personalized experiences. 

Analytics will be highly important for creating branded experiences that help to differentiate lenders from their competitors. By combining data from a product and pricing engine (PPE) with user behavioral analytics, lenders can make adjustments to the customer journey. For example, if analytics show that a high percentage of borrowers are getting stuck at a particular stage of the application process, they can add a tooltip to help borrowers to keep moving forward.

5. High-growth companies will lead the charge

Research indicates that companies currently experiencing high growth are more heavily investing in AI technology than other companies. In fact, 81% of leading firms say they are experiencing good to very positive results from their efforts. This head start will likely help these organizations to continue to outpace their competitors. 

Over the next decade, AI will help lenders optimize their resources, enhance loan officer and underwriter productivity and improve customer interactions. For more insights into how AI is revolutionizing mortgage lending, download our latest report, “Digital Lending: Ten key takeaways on the rise of AI in the mortgage industry.”

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