Rocket CEO talks new AI tool, changes in leadership and M&As

The Gathering: A new Synopsis tool, which analyzes and transcribes calls, is expected to save Rocket's servicing team nearly 40,000 hours per year

Rocket Mortgage launched a new artificial intelligence (AI) tool on Tuesday that allows its client experience teams to analyze sentiment, record behavior patterns, transcribe conversations and create tailored experiences during customer interactions. The lender estimates it will save tens of thousands of hours annually.  

That’s the latest step the mortgage lender has taken to integrate AI into its operations. It was announced during The GatheringHousingWire’s conference in Scottsdale, Arizona. 

“Synopsis is focused on transcribing and interpreting the conversations and the data that we have around our clients — for example, call logs and chat interactions,” Varun Krishna, CEO of Rocket Mortgage, said in an interview. “It uses generative AI to analyze those conversations and provides us with automation and feedback that we can implement.” 

The new tool is the first added to the ecosystem built under Rocket Logic, the lender’s patented AI-driven platform launched earlier this month. It is active for calls handled in the servicing and origination sides of the business, including loans sent by mortgage brokers working with Rocket Pro TPO

In 2023, the Detroit-headquartered lender generated $78.7 billion in closed loan volume and reached 2.5 million in loans serviced. Each year, Rocket employees participate in 65 million calls with clients, including 3.1 million phone calls from borrowers they service, the majority of them being inquiries related to payments and escrow. 

The new tool was built on the Amazon Web Services (AWS) cloud computing platform and used Amazon Bedrock, a service for building generative AI.

Rocket estimates that Synopsis will save the servicing team nearly 40,000 hours annually. It results from about “70% of the interactions being fully self-serve without the need for team member intervention,” the company explained. 

In addition, data collected from these calls will be used to enhance predictive capabilities. So far, it has led to a 10% increase in resolutions during a client’s first call, which saves nearly 20,000 per year in team members hours, according to the company. 

Krishna said that Rocket still relies on humans to ensure that the AI services operate with high degrees of accuracy and fairness while eliminating bias. At the same time, “human beings are not perfect creatures,” and AI is tracking human interactions as well.  

“The systems are designed with that dual feedback,” Krishna added.

Rocket’s AI journey

Since Krishna joined Rocket last year, the top-down message has been that AI is the future platform for the company. 

To accomplish that, Rocket has reallocated its resources. The lender has invested in data infrastructure and reduced its focus on areas such as auto and solar loans. Investments are going to specific areas of personal finance and lending that add to homeownership, Krishna said. 

“In the past, we focused on things outside of homeownership — auto, solar and these things that were adjacent. But what you can expect to see from us is a company that is incredibly laser-focused on homeownership. That means purchase, refis, servicing, home search.”

Rocket has also brought new talent to the organization. It will soon announce a new chief information officer after Brian Woodring announced his departure to pursue new opportunities. 

In February, AI and fintech expert Alastair (Alex) Rampell, who co-founded several fintech firms, including Affirm, joined Rocket’s board of directors. Krishna, a former executive at Intuit and PayPal, was appointed as the company’s CEO in July 2023, replacing Bob Walters.

Rocket’s executives have expressed confidence that investment in AI would accelerate the company’s growth and profitability. In 2023, the firm lost money, with a GAAP net loss of $390 million. 

According to Krishna, the company will pursue market share growth and profitability. The addressable market in mortgages is $1.5 trillion to $2 trillion, he said, and when real estate and financial services are added, it increases to $5 trillion. But Rocket is “under-penetrated in every metric, despite being a market leader,” Krishna added.  

Questioned about whether M&A deals are part of Rocket’s strategy, Krishna said that the company is “extremely well capitalized, has a fortress balance sheet and a ton of cash flow.”

“That means that we are able to be open to opportunities,” he said. “You have this market dynamic where valuations are down; you have a ton of fragmentation. So, we’re always looking for ways that we can move faster, whether that means build by partner. We’re definitely evaluating all opportunities in service to our strategy.”

In 2021, Rocket acquired personal finance app Truebill for $1.275 billion in cash. 

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