Mortgage industry zeros in on two technologies to improve processes
The mortgage industry identified two technology initiatives it claims have the greatest potential to improve processes and be the most broadly adopted over the next two years, according to Fannie Mae.
About 63% of senior mortgage executives named application programming interfaces as being most likely to streamline processes, while 62% tapped document management or optical character recognition, according to Fannie's first-quarter Mortgage Lender Sentiment Survey.
This survey comes at a time when mortgage tech experts see promise in things like artificial intelligence, machine learning and robotic process automation. And while this may be true, the industry still needs to keep incremental technology improvement efforts in place to help keep costs low and support a better borrower experience as activity continues to lag.
At 29%, a considerable share of mortgage execs also pointed to AI or machine learning as having the greatest potential to improve the mortgage business. Nearly the same amount, about 28%, named RPA as having such potential.
Still, companies eager to adopt tools like AI face roadblocks drilling down use cases for the tech and integrating with other parties.
An API is essentially a set of definitions, procedures and tools that allow for the creation of software; APIs access features or data in an operating system, and specify methods of communication among the components. OCR, on the other hand, is a tool used to identify characters in an image and convert them into machine-encoded text.
In terms of the most appealing concepts for APIs, execs named use cases involving borrower qualification verifications — where they could enter a borrower's basic information and get back the consumer's income, assets, employment history and credit profile — and appraisals — where they'd submit a home address and receive an appraised valuation and comparables from the API.
Regarding third-party API adoption, close to half, or 47%, consider the ease of integration the most important factor when making a decision. About 41% named the competitive advantage as the highest ranking criteria when deciding to adopt an API from a third party.