Real estate is a huge industry, which is why mortgage has a considerably wider impact on the economy and growth than other loans. Every month, thousands and thousands of individuals purchase a house and take a mortgage on it. Undoubtedly, the data collected by this industry is also too much. In fact, it is safe to say that a mortgage is a data-intensive industry.
Every time a user takes a mortgage loan, their proof of address, income details, identification, tax, and personal information are collected. Other than this, information regarding the property is also collected, the agreement is analyzed, and other related details are checked.
Now, imagine collecting this data for every person that takes mortgage – that’s a lot of data. And wherever there is data, artificial intelligence can help.
A recent survey revealed that technologies like machine learning and artificial intelligence would help the mortgage industry grow in the coming 2 years. The survey also explained that almost 2/3rd mortgage lenders know about artificial intelligence and almost 30% are already using this technology.
Looking at the current market situations, it is not hard to say that in coming years, artificial intelligence will enter the mortgage market. If not to streamline tasks, then to reduce the paperwork.
Paperwork in the mortgage industry takes up a lot of time of professionals. It also increases the chances of errors in the system. If AI technology is employed to achieve this task, professionals of the industry would be able to reduce the burden and focus on more strategic and judgement tasks.
Let’s see how artificial intelligence is penetrating the mortgage industry.
1. Reduced Processing and Costs
Currently, it takes around 3-4 weeks to process a mortgage.
No, we are not talking about a situation of a decade back. We are talking about right now.
If you visit a bank for the mortgage, they will give you the requirements. You will have to collect these documents and then the bank will move forward with the procedure. The verification at several stages passes through a series of intermediaries, all of whom take their sweet time to complete the process. As a result, acquiring a mortgage consumes up to 3-4 weeks.
With AI in the picture, all the slow processes would be removed. The repetitive tasks would be taken over by technology. This technology would also help the supervisors analyze several sets of data to find fraud transactions. The detection of documents would be accelerated and verification of the individuals would be achieved without any hassle. This means that the process of acquiring a mortgage will take 3-4 days rather than 3-4 weeks.
With a reduced number of transactions and days spent on processing a mortgage application, the cost of processing will also go down to a great extent. Further, a reduced number of manual errors would help the mortgage business eliminate the overheads. The compliance issues would reduce with AI. All these factors combined can reap huge benefits to businesses.
2. Instant Loan
Instant loans will actually become a reality. Currently, we only hear of instant loans which are not really offered instantly. Either the loan amount is too less or the bank offers it only to the existing customers.
With AI and ML in the picture, loans would be approved instantly. For existing customers, this would be a cake-walk. The AI technology would already have data so it would be easier to assess the creditworthiness of the customer without wasting any amount of time.
3. Improved Search Ability
One of the benefits of artificial intelligence in the real estate industry would be seen in portals. The modern buyer would be able to assess all the information from one online platform. The online platforms can collaborate with the bots of the bank. Whenever a buyer reaches out to these platforms, the platform can display the mortgage options available. With just a click, the bot at the bank will evaluate the creditworthiness of the individual and evaluate how much loan they can get.
Improving this search will extremely boost customer experience and make it easier for the home buyers to purchase a property without going through several hassles.
Conclusion
Currently, the mortgage industry has various bottlenecks which come in the form of assessments, credit score calculations, and paperwork. Artificial intelligence and machine learning can alone rectify most of these bottlenecks. So, if you are a mortgage vendor, consider utilizing artificial intelligence now. Utilize this new trend early and reap additional benefits.