These 16 Fintechs Capture State Of Housing Tech & Mortgage AI (MBA Annual 2024 Preview)
The Mortgage Bankers Association MBA Annual 2024 show is next week in Denver, and The Basis Point is honored to help MBA create and host their tech programming, including mortgage AI.
This is the biggest mortgage and housing conference in America where lenders, servicers, regulators, and fintechs all gather to map out 2025.
I’ll be hosting 16 fintech demos over 2 days to give everyone the latest on how our tech community powers $2.4 trillion new mortgages lenders will fund in 2025, and $14 trillion in outstanding mortgage servicing.
The MBA is a critical part of the housing ecosystem, with a primary goal of aligning with policymakers and regulators on common sense mortgage lending and servicing for consumers. And regulators definitely get that tech is the driving force for consumer and overall systemic safety.
With this context, I’ll say mortgage tech is at a critical juncture.
Here are 3 mortgage tech themes I’m discussing on stage next week at MBA Annual, along with 16 fintechs who are helping lead the way.
MORTGAGE AI IS EVOLUTION, NOT REVOLUTION
AI is upending all things mortgage tech, but regulatory compliance and disparate lender data sources will make an AI-led future more evolution than revolution.
Why? Because AI success (specifically generative AI success) is all about data. And until lenders and servicers can safely give AI access to all data across their stack with one single source of truth, Gen AI use cases are unreliable in a sector as highly regulated as mortgage.
No question there are killer early use cases in mortgage Gen AI, from text and voice customer service in originations and servicing, to natural language loan quotes for consumers and loan officers.
The mortgage industry is definitely fired up about Gen AI, but again, the killer apps will be evolutionary while we work through data and regulatory requirements.
What makes this mortgage AI evolution revolutionary is bringing different AI components together.
We must always delineate Gen AI from decisioning AI and machine learning.
What’s the difference?
Gen AI produces content based on learning from existing data (hence the notes about data hygiene above).
Therefore Gen AI is black box output, meaning every answer can be different, and this is a problem for highly regulated mortgage lenders and servicers.
Decisioning AI is based on if/then scenarios and produces fixed, tangible results. Loan approvals are a great example of decisioning AI that’s been mainstream in mortgage since the 1990s.
Machine learning analyzes data to help Gen AI and Decisioning AI systems adapt and improve.
Together these 3 things are powerful for lender and servicer productivity, and promising early Gen AI use cases mostly involve these other 2 capabilities.
MORTGAGE TECH STACK IS CONVERGING
Next week, I’m going to do a deep dive on the mortgage tech stack and cover all categories across originations and servicing, including:
ORIGINATIONS SYSTEMS
– Loan Originations Systems (LOS)
– Point of Sale Systems (POS)
– CRM & Marketing Automation Systems (CRM)
– Lead Generation & Routing Systems (LGS)
– Valuation Systems (aka appraisals and automated valuations)
– Digital Closing Platforms (DCP)
SERVICING SYSTEMS
– Servicing Systems Of Record (SSR)
– Non-Performing/Loss Mitigation Systems (NPL)
– Consumer Servicing Systems (CSS)
– Loan Onboarding & Movement Systems
SYSTEMS THAT RUN ACROSS ORIGINATIONS & SERVICING
– Product & Pricing Engines (PPE)
– Cap Markets & Trading Systems (CMT)
– Customer Engagement Platforms (CEP)
– Automated Underwriting Systems (AUS)*
– Data (business intel and analytics on customers, markets, competitors)
– Finance (tax, audit, consulting software powering lender/servicer ops)
I’ll post more here on The Basis Point in the coming weeks detailing each of these categories and the fintech companies comprising them.
For today, I’ll say key parts of this mortgage tech stack are converging.
A good example here is CRM and POS.
CRM is about pre/early funnel as well as post close engagement and retention.
POS is about making app-to-close easy for consumers and LOs, which is the rest of the funnel.
So it’s natural to see these categories converge, and will hopefully trim lender cost.
The open API ecosystem is evolving well in our highly regulated space**, further driving convergence across core mortgage tech categories.
But read that ** footnote below to see why this isn’t happening faster (comment or reach out if you agree/disagree!).
16 FINTECHS LEADING MORTGAGE AI & TECH OVERALL
Here’s a quick shout out for all 16 companies I’ll be hosting on stage next week
They all capture these categories and themes discussed above, including mortgage AI.
Here’s how it works with The Basis Point’s Mortgage Bankers Association tech showcases:
Each company demos for 8 minutes.
Then I do live analysis on stage with each of them.
My analysis and feedback is in the persona of a lender/servicer buyer of this tech.
It’s lively and a great place to get the latest across the whole tech stack.
So if you’re in Denver next week, come join us for fast, fun intel!
If you’re not there, always reach out if you want to discuss this stuff.
And sign up for our newsletter, because we’ll be doing lots more on these topics in the coming months.
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DAY 1 (MON 10/28/24, 2:30 MT) PRESENTERS:
– Vesta: Industry’s newest, truly modernized LOS
– Candor Technology: AI PreQual for fast, precise pre-approvals
– SimplyIOA: One-stop shop to solve homeowner insurance crisis
– IDIQ: CreditBuilderIQ to build credit, increase scores for borrowers
– Mortgage365: Single UX for LOs combining CRM, POS, LOS
– LenderLogix: QuickQual to increase pre-qual to app rates 40%
– Xactus: All VOIE, Flood, other verifs + auto-LOEs in 1 place
– Calyx Path: Single system of record combining LOS, POS, AUS
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DAY 2 (TUE 10/29/24, 1:30 MT) PRESENTERS:
– LoanPASS: Revolutionizing PPE with Gen AI + Decisioning AI
– Friday Harbor: AI LO assistant for 24/7 real-time underwriting
– Insellerate Aithena: Use AI to see if a loan will fund on first call
– Sagent Dara AI: Turn docs into data & decisions for servicers
– Jaro: AI-powered appraisals to improve accuracy, quality, speed
– Blend Rapid Refi: Lower cost & grow conversion in 2025 refi cycle
– Optimal Blue: AI assistants for cap markets hedging & trading
– Ocrolus Inspect: Find & resolve borrower & property issues in 1003s
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SHOUTS TO MBA FOR SUPPORTING MORTGAGE TECH
This is the final countdown to MBA Annual24 with 3500+ attendees, 130 exhibitors, 40 sponsors, and 12+ hrs of TECH ELEVATED content, including these 16 fintechs.
I just want to give special shouts to Julie Kind, Dawn Williams, Bob Broeksmit, Rick Hill, Peter Grace, Angie Kocken, Ashley Marshall, and the whole Mortgage Bankers Association team for allowing The Basis Point to help with programming to drive mortgage innovation!
And bravo to Robyn on The Basis Point team for how I flip onto #MBAAnnual24 demo stage in image above 😂.
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Reference:
– MBA Annual 2024 TECH ELEVATED agenda – 12+ hrs of mortgage tech
– MBA Secondary 2024 LIVE BLOG – State of Mortgage Markets, Rates, Regs, Lenders (TBP)
– 2 Things Wall Street Misses About Rocket’s Fintech Long Game (TBP) – fintech valuation concepts in this 2021 piece hold up well
* In The Basis Point’s mortgage tech analysis, this AUS category includes Generative AI, Decisioning AI/Machine Learning, and OCR for all types of verifications (income, assets, employment, flood, credit, etc.) which are often called VOIE or VOIEA as a separate mortgage tech category. VOIEA stands for Verification of Income, Employment, Assets.
** Reasons open APIs in mortgage have been slow to evolve include disparate data as discussed above, and fintech competition. Nobody talks about competition too openly, but tech providers sometimes choose to be less open about easier, tighter integrations enabled by a totally open API ecosystem. The motivation for this is to favor solutions they’re providing (or building) instead making it equally easy to integrate competing category leaders for those same solutions. For the most part, there’s friendly competition among mortgage tech providers (aided by lenders and servicers pushing competing fintechs to do better/tighter integrations with each other), but it’s worth noting these competitive behaviors among fintechs that slow down the vision for an open ecosystem.