The digital mortgage continues to evolve, but what is the end goal? Will it eliminate human intervention completely? One expert says it won’t. In fact, it might create higher-paying jobs.
“Automation inherently reduces reliance on humans so naturally, one outcome can be contraction within certain segments of the lending labor force,” said Nick Volpe, chief strategy officer of ARMCO, a HousingWire 2019 Tech100 winner. “While this may be a potential downside, it also creates the opportunity to re-allocate staff members to areas that are harder and more expensive to staff.”
HousingWire’s Tech100 recognizes the most innovative and impactful companies in the housing and mortgage industries. Now, HousingWire is launching an all-new award program – the Tech Trendsetters, which recognizes the experts behind these innovative companies.
We want to recognize the experts behind the technology. The people who drive the innovation. The executives making an impact. This inaugural program will award 50 of the technology leaders driving innovation in the housing economy. Nominate your tech driver today, the nomination period closes July 26, 2019.
How do you become a leader in the tech space? One of our previous Tech100 winners says it like this:
“ARMCO is a tech industry leader because we deliver the highest quality technology and the highest value intel to the mortgage and financial communities,” Volpe said. “Our success as a company has always come from providing the intel and solutions that elevate both individual lenders and the industry overall.”
HousingWire sat down with ARMCO executive Volpe to talk about the housing industry’s end goal for the digital mortgage.
HousingWire: How will the introduction of robotics change the mortgage process?
Nick Volpe: Robotics will bring about faster, more accurate decisioning, which in turn will deliver a better, faster, more intuitive experience for consumers. The mortgage lifecycle is filled with opportunities to automate and integrate, and these are two key functions that robotics will bring. At ARMCO, QA and QC are cornerstones in our wheelhouse. Robotics-based automation in QA and QC will center on reducing costs and closing any opportunities for human error. As a result, lenders will benefit from a smarter, faster, exception driven environment that scales better and leverages human capital with the utmost in efficiency. Ultimately, this will allow lenders to focus on originating more loans at lower cost. In addition, tighter integrations and automation will bring deeper, more meaningful insights into the nature, quality and value of the loans. Lenders will have better insights as to why loans are approved or rejected as a result, we’ll see greater predictability with the health of each loan.
HW: While most of us know some of the problems robotics and AI offer to solve by removing human error, are there any down sides to transitioning the mortgage industry to be robotics based?
NV: Automation inherently reduces reliance on humans so naturally, one outcome can be contraction within certain segments of the lending labor force. While this may be a potential downside, it also creates the opportunity to re-allocate staff members to areas that are harder and more expensive to staff. While there are plenty of areas where robotics and AI can advance the mortgage process, at least for the foreseeable future, we will need human discernment to make judgment calls in certain areas. There are still numerous scenarios where machines lack the capacity to evaluate loans, match borrowers to opportunities, and offer alternative solutions that create and preserve profitable customers.
HW: We talk a lot about how robotics and machine-based processes will create more efficiencies and cut back of the length of time needed to originate a mortgage, but what do you see as the “end goal?”
NV: From a technology perspective, the ideal “end goal” is a fully integrated, start to finish loan lifecycle that requires as little human intervention as possible. As far as QC is concerned, our goal isn’t necessarily about adding or eliminating human capital, but rather about addressing loan defects as early in the process as possible, which usually means while it is being manufactured. This is the best way to affect a significant decrease in the QA process churn and cleanup efforts, which in today’s world often occur after the loan has been made. At ARMCO, one of our end goals is always to remove as much friction and as many re-work efforts as possible from the manufacturing process, so lenders can deliver a more fluid, intuitive and efficient experience while also enhancing their own profitability.