What Role Can Artificial Intelligence Technology Play in Mortgage Underwriting?

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President Cybertek-Cogensys Dallas

THE ORIGINAL BENEFITS OF artificial intelligence in mortgage underwriting were the increased integrity of decisions, increased communications and knowledge between work groups, and collapsed business transaction cycles. These benefits still hold true. The primary difference today is that these benefits were originally isolated for the underwriting event. With the advent of other emerging technologies wrapped around AI technology, the industry is now positioned to streamline and fully integrate the entire mortgage transaction process -- from data collection through servicing. Marrying and integrating AI systems with the front-end data collection systems, EDI networks, credit bureau interfaces, servicing systems, and document management systems positions the mortgage lender to magnify and significantly enhance the original benefits of AI. The end result is that the lender's competitive advantage grows and customer service is enhanced.


Executive vice president Computer Power Inc. Jacksonville, Fla.

WE BELIEVE that if used properly the new automated underwriting systems will change the velocity with which you make decisions. By having access to quality data at the point of sale, you can make decisions earlier in the process. This would enable you to define which loans you pay more attention to.

Similarly, AI adds value to change management or workflow management to distinguish what areas pose a problem or raise questions. If you look at the traditional underwriting process, we wait until we've done everything to put it to underwriting and then if we do anything wrong or you've got something incomplete, you have to go back into part of the process. If we impose this review element earlier, then we might be able to do things more completely at the inception of the process rather than at the end.


President Sibley Mortgage Co. Rochester, N.Y.

ONE OF THE THINGS that the industry is looking for is something that will help reduce processing time, which in turn would cut costs.

AI offers a way to make the loan review process more even-handed. I think it is particularly important to the industry that organization such as Freddie Mac are coming out with their own programs. In reality, what most of industry is doing is trying to underwrite to secondary market requirements. This will mean having a secondary market agency take a look at the loan, run it through a system and then indicate whether it is acceptable or not.

AI systems can also help us to tackle the issue of fair lending. Although this hasn't been one of primary thoughts on everybody's mind, I think it's a great color-blind way to at least take a first pass at underwriting. I don't think we ever want to be in the situation where the computer says yes or no and there's no way for individual to do anything about the noes. With any system, the loan officer has to be able to look at the application and see if can something can be worked out. …