People beat chatbots says new study
When I tested ChatGPT/Dall-e’s drawing ability it was stunning – but not right. But knowing those limitations, mortgage professionals are already using LLMs (Large Language Models) in their offerings, and Trades Unions are scrambling to hold back the AI tide’s effect on their members.
Artificial Intelligence (AI) is rapidly advancing across nearly all industries, reshaping roles and expectations, and the mortgage sector is no exception. As AI grows in its ability to handle tasks traditionally done by humans—such as data analysis, customer inquiries, and even decision-making—mortgage intermediaries must adapt to stay competitive.
However, while AI continues to improve, the demand for human interaction remains strong, reflecting the unique value that real people still bring to complex financial transactions – and not everyone is welcoming the new tech with open arms.
“I think AI is dangerous because I think AI is actually focused on what’s happened in the past and not the future,” AMI’s departing CEO Rober Sinclair told us. “With AI, we learn from the past, it’s not got that ability to intuitively think about the future, at this point anyway, or the bits that do are very expensive and are therefore not going to get applied commercially in this type of area.”
A recent study by Stanford University highlights AI’s capabilities in areas like language comprehension, predictive analytics, and customer service while MIT has also released a study showing that AI could pretend (online) to be a real financial advisor. “An LLM (Large Language Model) can roleplay a financial adviser convincingly and often accurately for a client,” said the report’s authors.
Systems like GPT-4 are already demonstrating their prowess by efficiently handling inquiries, generating personalised reports, and performing risk assessments in the mortgage industry. AI-powered tools can analyse vast amounts of data faster than humans, reducing the time brokers spend on tasks like document verification by up to 50%.
“The dramatic appearance of AI on the scene will lead to wholesale changes going forward, and slow adopters will be left behind,” Bob Singh, the founder of Chess Mortgages told Mortgage Introducer in an exclusive interview.
But even with these advancements, the human element cannot be entirely replaced. UK-based software provider Finova newest report confirms that nearly 42% of borrowers still prefer speaking on the phone with a person when dealing with mortgage-related queries.
While AI-driven tools are becoming more prevalent, many consumers feel that these technologies alone are not sufficient to meet their needs. Finova’s report revealed that only 13% of borrowers enjoyed interacting with chatbots, while just 12% found virtual consultations with AI useful. In contrast, phone conversations with real people remain the most effective way to resolve concerns.
“Our research highlights some significant gaps in the market, confirming that lenders’ tech still has some way to go before it completely aligns with borrowers’ expectations,” said Chris Little, Finova’s CRO. “While the sector has upped the ante in recent years, and is increasingly adopting more digital solutions, there is still room for improvement. “A considerable portion of borrowers still value personal interactions, and there’s no reason why they have to forgo the human element to reap the efficiency benefits that come with digital solutions. ”
Sinclair agrees. “There’s also people who think they can solve everything by tech, and actually I struggle to work out where the commercial benefit is in putting it into tech. There’s elements of ‘how do you build a relationship with a customer, because someone’s just dropped it all into a machine?’ When you come to talk to them, you come in cold with no actual feel for them. I just don’t think it works in what is a sales industry.”
This highlights an important point: while AI can streamline processes and improve efficiency, it lacks the personal touch that many clients seek when making significant financial decisions like buying a home. Trust, empathy, and the ability to adapt to nuanced situations are areas where human brokers continue to excel. AI may outperform in data-intensive tasks, but real estate remains a sector where relationships matter, and personalized advice is often preferred.
For mortgage intermediaries, the future lies in leveraging AI to handle routine and administrative tasks, while focusing their attention on more strategic, personalised interactions. AI can serve as a powerful assistant, enabling brokers to offer quicker, more data-informed services, but it should complement rather than replace human expertise. This blend of technology and personal service will allow intermediaries to provide a holistic advisory experience that satisfies both efficiency demands and the need for human connection.
As AI continues to evolve, intermediaries who embrace these tools will find themselves in a stronger position to thrive. However, the enduring value of real, human advice remains critical, at least for now, particularly in a sector as personal as home ownership.
Which mortgage lenders are leveraging AI?
HSBC: HSBC has incorporated AI into its mortgage services, enhancing customer interactions, automating segments of the application process, and using AI to analyse large datasets for more informed decision-making.
Barclays: Barclays employs AI to streamline the mortgage application experience, utilising chatbots for customer service and AI algorithms to assess applications efficiently.
Nationwide Building Society: Nationwide leverages machine learning algorithms to boost the speed and accuracy of its mortgage processes, helping assess creditworthiness and expedite applications.
Lloyds Banking Group: Lloyds uses AI across its operations, including mortgage lending, where it applies AI to analyse credit risk and streamline various steps of the application process.
NatWest: NatWest automates portions of the mortgage process, such as document handling and application processing, with AI, leading to faster and more accurate lending decisions.
Santander UK: Santander integrates AI to enhance the customer experience, utilising predictive analytics for smarter, quicker decision-making in mortgage approvals.
Metro Bank: Metro Bank has adopted AI to improve efficiency in its mortgage processing, enabling faster application assessments and approvals.
Atom Bank: As a digital-first bank, Atom heavily relies on AI to deliver a fully digital mortgage process, from application submission to final approval.
MPowered Mortgages: MPowered uses a ChatGPT-powered chatbot that handles 30% of broker and intermediary inquiries without the need for human interaction.
Bath Building Society: Bath Building Society has implemented an AI chatbot specifically for intermediaries, streamlining communication and inquiry resolution.
