Visiting the local bank to acquire a mortgage might be a thing of the past. With the massive rise in digital mortgage lenders and artificial intelligence (AI), Americans might be skipping the trip to brick and mortar establishments these days.

Are AI and digital lending providers a detriment to the mortgage industry, or does it open up new avenues for growth and connection?

First, AI allows lenders to automate different parts of the home loan process, such as running credit scores, reviewing mortgage applications, and underwriting. In most cases, the technology reduces costs, increases accuracy, and streamlines the whole process. Not only can it help out lenders, AI can also make the customer’s process much smoother and gives them more control.

Individuals can also shop for the best interest rates online without even talking to a human, which puts the power back in the hands of the consumer. Fairly common and simple conversations about home loans can be automated by AI over chats and other online apps so that the person seeking a loan doesn’t have to establish complex relationships with lenders and become overwhelmed with communication.

This applies to the real estate shopping experience as well. Recently, Redfin announced a ChatGPT plugin a day after Zillow announced one of its own. These plugins let users describe homes in a conversational way to ChatGPT, which then in turn responds with relevant listings and recommendations.

Banks and online lenders can also use AI-powered technology to analyze massive amounts of data in order to assess risk levels, establish approvals, and provide fast and convenient service. This means families seeking to own a home could receive an answer of “yes” or “no” on a loan within minutes of submitting the required information.

With all that said, some mortgage professional are more worried than others. Microsoft reported that 82% of leaders predict their employees will need new skills to be prepared for the growth of AI.

However, Mortgage Broker and Co-founder of Edge Home Finance Tom Ahles affirmed, “In my opinion, we are prepared for AI and what it may or may not be due to our industry. We will always have loans that do not fit inside a perfect box and will take a personal touch to ensure all aspects are considered. Most of the simple day-one certainty loans will be automated and will lower the origination cost for these loans as it will be even faster and cheaper than it currently is.”

So in no way will AI remove the need for mortgage brokers and lenders altogether; on the contrary, AI will be a useful tool but will not replace those key meetings and conversations that can only happen without a robot.

Ahles added that the main skills loan officers will need to have are networking, marketing, and building unique relationships and connections in the community. It could also push them to learn about more complex loans.

Rebecca Richardson of UMortgage said, “On our team, we are using AI in several ways so I’d say we are adopters of it, but there’s so much more to explore. While there are some areas of concern if AI isn’t used or developed responsibly, I view it as most other tech advances and enjoy finding ways to implement it to be more efficient.”

Despite all these technological improvements, the human touch in the mortgage industry will always be needed.

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