Mortgage execs on the phenomenon's best use cases in 2024
Spiking chatbot usage and the growing prominence of artificial intelligence (AI) in recent years sparked a flurry of speculation among mortgage professionals about their likely impact on the industry’s future. But with 2025 looming, some of the early furor about AI’s potential for mortgage disruption appears to have been tempered by more grounded expectations of what’s in store.
Tech and lending executives speaking on a panel at the Canadian Mortgage Summit in Brampton spoke to that shifting landscape, with Dong Lee (pictured, top left), chief executive officer of Axiom Innovations, noting how the outlook south of the border on AI in the mortgage space has evolved.
That’s due in part to the growing realization, he said, that while AI is potentially a game changer if implemented with skill and innovation, plenty of AI projects – as with any area of tech development – will ultimately fail.
A visit to the recent US Digital Mortgage Conference in San Diego, Lee said, revealed that “a lot of companies were spending money on AI and the prototype was awesome. The ideas that they had were awesome. But as soon as they tried to put it into practice, it didn’t work.”
That could give pause for thought to doomsayers who may have viewed AI as an existential threat to a slew of professions, including the mortgage brokering space. What’s more likely for brokers, according to Lee, is that opportunities around generative AI will continue to emerge – presenting different marketing tools and options. “But anybody who thinks that this AI stuff is going to take us out of business and we’re all going to lose our jobs, I think you’re sorely mistaken,” he said.
Are regulators in Canada set to crack down on AI in financial services?
Indeed, growing regulatory focus on AI in the US is seeing authorities turn their attention to chatbots, Lee pointed out, and crack down on companies whose models give incorrect or misleading answers.
That risk means some companies in the US are pulling back, he said, “and a lot of the AI tools [being] used now are inward-facing, teaching underwriters how to do their work. They’re not forward-facing to consumers because there’s too much risk with that sort of thing.” With Canada likely to follow suit, “it’s a good sign for all of us.”
At the Canadian Mortgage Summit, alternative lending executives reflected on the past year and the 2025 outlook, noting challenges ahead but also opportunities for mortgage professionals to showcase their value.
— Canadian Mortgage Professional Magazine (@CMPmagazine) October 4, 2024
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Leading companies in the Canadian mortgage industry are taking a similarly measured approach to AI. Derek Matthewson (pictured, middle left), principal, broker channel development at Filogix, said that the company had focused on introducing “features with AI in them” rather than AI features in their POS, seeking to leverage what AI does well.
That started with a chatbot whose features were restricted – meaning it would only answer questions related to ExpertPro, one of the company’s POSes – and also includes the ability to auto-compose emails to clients and lenders. “We’ve got a few others in the pipe – but we want to be careful… to make sure these things work and execute the way we want it to,” he said, “not just rely on AI blindly and hope it does a good job.”
Finding the right ways to use AI in the mortgage space
Jared Stanley (pictured, middle right), Neighbourhood Holdings’ senior director of originations, said his own company has developed a summarizer, looking at the entire application and summarizing what the request is from brokers’ notes. Still, he also noted the importance of not assuming AI’s suitability for every task. “That’s really important because AI is advancing so quickly, a lot of this stuff – even if it does have a use case, it might just be obsolete,” he said.
Chatbots could technically be introduced to answer questions about lending guidelines or other topics, he said, but often brokers and other mortgage professionals value speaking in person with a real human about those issues instead of having their queries answered by a computer.
Of course, all that is not to say the potential impact of AI has been vastly overstated. Tom Hall (pictured, top right), founder of BluMortgage, said what’s important is focusing on the things that are worthwhile pursuing when it comes to AI and being able to drown out much of the noise and hype that’s arisen over the past year.
AI might ultimately revolutionize the industry – but for now, he said BluMortgage’s priority is helping streamline and smoothen users’ day-to-day work through what’s currently available. “We’re just taking a look at some of these tools like ChatGPT and saying, ‘How do we make it a more integrated experience? How do we allow a prompt that you might already do [yourself]? That’s how we’re looking at it,” he said.
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