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Generative artificial intelligence holds great promise and risks for the mortgage industry, but despite the challenges, the developing technology is finding its place in companies' workflows.
Its most likely adoption is in marketing applications.
“Imagine if you Googled a topic, clicked on a few links, and then summarized what you found on those links. Imagine if a machine could do that for you in 30 seconds,” said Adam O'Daniel, chief marketing officer at Guild Mortgage.
“It doesn't provide me with data that I probably couldn't find in a Google search, it just saves me the time it would take to organize and compile the data.”
Although widespread concerns remain, AI is proving its value as a tool to drive efficiencies across business sectors and inspire marketing professionals. Mortgage and real estate companies have the same concerns about risk as any other company, but their marketing teams and loan officers are experimenting at different levels and learning how to tailor AI to their specific needs.
“It's been a starting point for a lot of people, and it's helped them if they're, say, at a creative block,” says Whitney Blessington, chief marketing officer at Churchill Mortgage. “We call it a brainstorming partner, but it's not a human.”
Another benefit of generative AI comes from its ability to do rapid research: “It helps you find good themes,” O'Daniel says.
Useful but developing technology opportunities
Mortgage companies, more than other types of businesses, appear to be actively considering how artificial intelligence can help their marketing efforts.
While some forms of AI are already being used in underwriting, particularly for tasks related to extracting and processing data, concerns about potential compliance violations have made some lenders cautious about applying the technology in a customer-facing capacity. Marketing tasks, however, offer an opportunity to see how AI can improve efficiency within the right guardrails.
In a 2024 survey released by Arizent, 64% of mortgage industry professionals said they would be open to using artificial intelligence for a large part of their marketing and promotional activities in a hypothetical scenario where regulation did not exist. Interest in the mortgage industry far exceeded the percentage of similar responses in the other six financial sectors, none of which exceeded 50%.
At the same time, 55% of the mortgage industry said they would use it for most tasks related to research and fact-checking.
But recent guidelines issued by the U.S. Department of Housing and Urban Development say their use in advertising still poses the risk of bias in outreach.
But despite the industry's enthusiasm, mortgage industry leaders say the “A” in AI doesn't stand for accuracy, and human marketing experts will still need to be there. Even when used for research purposes, users are finding they're encountering answers that aren't factual.
“You can't just rely on it blindly,” Blessington said, “but you still have to do your homework.”
“I think the biggest benefit right now is that it really helps streamline workflow,” she added, comparing it to interns who handle low-level administrative tasks like writing metadata descriptions and alt text for images.
“It helps with ideation, planning, and actually creating the content,” O'Daniel said. But when generative AI “creates” its own content, it doesn't meet the standards required by the industry, he said.
“Terminology needs to be adjusted because it may be terminology that suits a bank rather than an independent mortgage lender. Some of the finer nuances of the business are not being fully communicated.”
Current usage scenarios and risks
The mortgage industry’s use of artificial intelligence, particularly generative AI like ChatGPT and Microsoft Copilot, is still in its infancy, but it’s set to expand rapidly and could change the way work gets done in the future.
Entering the world of AI can seem daunting, but the technology also offers customization that promotes ease of use, according to Ginger Bell, who regularly hosts seminars on artificial intelligence for real estate professionals, co-hosts the podcast “AI Clubhouse,” and is founder of the housing industry video platform Edumarketing.com.
Loan officers and lenders can customize the generative AI to target the situations and guidelines they commonly work with: “You just input your scenario and it will read out the guidelines to you,” Bell said, though he cautioned that validation is still required.
“You can also ask them to quote exactly where they're pulling that information from. A lot of it is training them to get the questions right and letting them know what they want in terms of a response and what they want that response to look like.”
Bell sees ChatGPT being used often to help craft emails and social media posts, and some mortgage professionals are even using it to write scripts for video marketing. Users can customize the gen AI tool by inputting transcripts, articles and other work they've previously written, and ultimately train it to sound more like their own voice, she said.
But monitoring and enhancements also must remain top of mind, said Jason Perkins, co-founder and president of Bonzo, a provider of communications engagement software and mortgage customer relationship management systems.
“I believe that AI-generated content is part of the business paradigm, but not the whole story,” he said. “Personalization is what drives the conversation.”
Generative AI can also rapidly build marketing campaigns through a series of prompts — a set of instructions or steps for crafting a message with specified parameters that can address a specific topic or target a borrower segment. The prompts can also ensure that required disclosures and licensing information are included.
“Many firms need to recognize that this is a huge compliance opportunity to make sure their loan officers are providing information in a compliant manner,” Bell said.
But while businesses can personalize prompts and content through the open-source generative AI platform, many are instead turning to the enterprise version to protect their proprietary information and stay compliant. Some accounting firms are mandating that employees use the personalized generative AI on the enterprise edition, which remains closed source, Bell said.
“There are a lot of people using things that are available to consumers on ChatGPT and other platforms like that, and it's certainly a great tool, but we're trying to be very careful about how we use those platforms,” O'Daniel said.
“With a public platform, any data you upload to the model stays in the model and helps with future learnings, which is great, but there may be times when you want to share information from product guides or other corporate programs that you don't want under your control,” the Guild's marketing lead added.
Bell advised those using public platforms to be careful not to put nonpublic information on them because they are open source, exposing companies to cybersecurity risks in addition to potential breaches.
Perkins said relying on publicly available artificial intelligence platforms without properly vetting the content they generate also carries the risk of copyright infringement.
“They're just collecting data from the internet,” he said. “Companies and businesses will put fences on the data,” meaning businesses need to be aware of how loan officers and staff are using AI-generated content in social posts and ads.
Future potential and customer trust
While AI-created marketing content has primarily appeared in the form of written text, artificial intelligence is also making inroads into other creative mediums. “There’s a lot of new technology being built around this right now,” Bell says.
Advanced generative AI tools already exist to alter photos, and there are emerging businesses producing original images and videos based on an individual's likeness and voice from a single recording.
But while AI-generated image video represents one of the next growth stages in automation, it also comes with the potential for abuse by fraudsters, posing a challenge for businesses of all types who want to use the technology to their advantage without compromising customer relationships.
“I think there's a lot of questions about how it's going to impact the brand,” O'Daniel said.
“It can go either way. Some people would welcome more frequent updates from their lenders or loan officers. So if technology can give you more frequent, useful information, it can build trust. But if customers feel they've been tricked and that this avatar isn't actually their loan officer, that trust can be eroded. So I think we have to be very careful.”