How AI will transform the mortgage and appraisal industries

Every business is on the brink of significant transformation driven by the potential of Artificial Intelligence (AI) and workflow automation, and the mortgage industry is no exception. With AI’s capacity to perform complex reasoning and manage autonomous operations, it is critical to explore how this technology can reshape industry standards, enhance operational efficiency, and how we as an industry manage its inherent risks.

At Jaro, our commitment to integrating AI automation alongside the traditional appraisal process is not just about keeping pace with technology — it’s about making the process of appraising and valuing properties better for every stakeholder: from lenders, to borrowers, appraisers and everyone in between.

HousingWire spoke with Gareth Borcherds, managing director at Ascent Software Group about how AI is speeding up processes in the mortgage industry.

HousingWire: How is the use of artificial intelligence (AI) changing the mortgage industry

Gareth Borcherds: The mortgage industry has long been characterized by complex processes and meticulous evaluations. However, with the integration of artificial intelligence (AI), the industry is undergoing a profound transformation, redefining how mortgages are processed and appraised. AI’s capacity for complex reasoning and autonomous operations is revolutionizing the mortgage landscape, enhancing efficiency, accuracy, and reliability across various industry segments.

AI, primarily through machine-learning algorithms and data analytics, serves as the linchpin of this transformation. Lenders and Appraisal Management Companies (AMCs) now leverage advanced AI tools to automate tasks, analyze vast datasets for market trends, and identify potential risks with unprecedented efficiency. This automation not only alleviates the burden of manual labor, but also significantly reduces the risk of human errors, creating a more robust and reliable mortgage ecosystem.

HW: What are some of the opportunities of using AI to speed up processes in the mortgage industry?

GB: The integration of AI presents numerous opportunities to accelerate processes in the mortgage industry. AI can automate repetitive tasks, such as data collection and analysis, significantly reducing turnaround times for appraisals and loan approvals. Additionally, AI-powered tools can enhance the accuracy of appraisals by providing objective insights and identifying relevant market trends. By leveraging AI, stakeholders can optimize resource allocation, improve operational efficiency, and deliver faster and more reliable mortgage services to clients.

HW: What myths around AI would you like to set straight?

GB: Despite its transformative potential, several myths and misconceptions continue to hinder the widespread adoption of AI in the mortgage industry. One prevalent myth suggests that AI will replace human appraisers entirely. However, AI should be viewed as a complementary tool that enhances human capabilities rather than replacing them. Human oversight and validation remain essential to ensure the accuracy and reliability of AI outputs.

The misconception that AI is only accessible to large institutions with substantial resources is far from true. Many AI solutions are scalable and affordable, catering to lenders and AMCs of all sizes. Additionally, concerns about AI introducing bias into the appraisal process can be mitigated through proper training and calibration of AI algorithms, which standardize data analysis and decision-making processes.

HW: How is Jaro smoothing out the edges around AI use and workflow automation?

GB: In the realm of AI and workflow automation, Jaro emerges as a pioneering force, setting new standards for appraisal quality and efficiency. Through a suite of tech-enabled services, including JaroDesk, JaroKit, and JaroInspect, Jaro integrates AI and machine-learning technologies to proactively address appraisal quality control challenges.

By leveraging AI, Jaro streamlines appraisal workflows, reduces the need for manual interventions, and ensures that human expertise is focused on high-complexity or high-risk cases. Ultimately, Jaro’s approach to AI and workflow automation aims to optimize appraisal quality while improving overall productivity and reducing turnaround times, thereby revolutionizing the mortgage industry from within.

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