How AI Supercharges Your Mortgage Underwriting Process

mortgage underwriting Jun 30, 2022

Mortgage underwriters shoulder the immense responsibility of determining the worthiness of a borrower to get a loan sanctioned. Their decision is critical to ensure that lenders do not approve a bad loan that has a low resale value in the secondary market.

However, human discretion is prone to errors and may make the process slower. The mortgage underwriting process can be made less prone to errors and faster by introducing AI. Essentially, AI boosts the efficiency of experts to expedite and make mortgage underwriting more error-free and compliant. In this article, we will explore deeper into how AI makes the process of mortgage underwriting more efficient.

Understanding the Automated Mortgage Underwriting Processes

Underwriting was difficult in the past, owing to the huge manual labor involved. Automated underwriting techniques have freed underwriters from these constraints.

AI has helped mortgage companies to move away from the traditional linear processes and toward exception-based operations. It is used in the various stages of mortgage underwriting process, starting from obtaining information about the income and credit history of the loan seeker. The AI powered models are used to identify and evaluate the loan seekers information in real-time, it detects any irregularities in the financial health of the borrower.  The system further suggests the mortgage provider to change the terms of the loan, in when it detects that the borrower stands at a greater risk to turn out to be a defaulter.

In the loan processing documentation stage, the mortgage underwriting tool retrieves documents from different systems, database, and workflow tools. It then organizes the customer data in a centralized digital system. Underwriters can easily access this information using simple details such as the borrower’s name.

AI helps the underwriter in making informed credit decision making. The AI tools have inbuilt graphical editors that enables the user to design, implement and test fresh credit decision making models. These models are based on Machine Learning Algorithms and make way for automatic workflows in the process of credit decision making. They enable the underwriter to make his decisions more efficiently, in terms of both speed and accuracy.

How Does AI Help to Enhance the Underwriting Process Efficiency?

Automated mortgage underwriting process helps to improves client experience, provide more accurate quotes, and allow for improved profitability without the need for constant workforce expansion. Let us now look into the various ways in which AI can help bring more efficiency to the mortgage underwriting process.

Prevent Manual Errors

A mortgage undertaker has to perform a lot of manual tasks in order to determine borrowers’ creditworthiness. Such manual tasks include obtaining, scrutinizing, and verifying borrowers’ documents at massive scales. Thus, there is higher chances of errors.

Automation is the best solution for underwriters to avert such manual tasks-led errors. Automated solutions speed up the underwriting process, reducing the amount of time spent on manual tasks and allowing for process consistency.

Enhancing the Underwriter’s Productivity

 Acceptance of risk is a human decision that cannot be entirely automated, but the processes that surround it can be. Automation provides mortgage underwriters with new tools, data, and support to help them do their jobs more effectively. Instead of displacing underwriters, automation shifts their emphasis from basic tasks to high-value operations.

AI-driven data analytics empowers the underwriters by providing them with the information they need. It can be used in conjunction with underwriter’s expertise in evaluating risks, to ensure that no bad loans are issued.

 Efficient Scanning of the Documents

An underwriter has to spend hours scanning through thousands of documents, such as the borrower’s employer information and credit history. Page classifiers powered by artificial intelligence (AI) can help here.

These programs are able to sift through massive amounts of data and deliver it to underwriters.

Artificial Intelligence document scanners assist mortgage underwriters to detect any incorrect document that might happen to be placed among the group of documents. It prevents the mixing in information from another applicant.

Presenting Our Popular In-House Mortgage Underwriting Tool Msuite

We bring you Msuite, our mortgage automation platform to help make your mortgage underwriting process be more efficient, in terms of accuracy and speed. It was developed by our in-house experts, using their vast experience in serving more than 100 lenders or service providers over the last ten years.

Msuite is an intelligent OCR Platform. It uses the power of Artificial Intelligence and Machine Learning to automate the different steps involved in the process of mortgage underwriting. This tool serves several functions which eliminate the need for manual work. These functions include:

  • Indexing Engine: Msuite comprises a superior indexing engine. It identifies over 350 different kinds of documents that underwriters need to refer to. This tool’s working isn’t hampered even if these documents do not share the same format. It has an accuracy rate of 95%. It is powered by ultra-advanced technology such as OCR, Computer Vision and Machine Learning.
  • Data Extraction Engine:  Mortgage loan underwriters need to extract data from a number of different documents such as income statements, loan closure, etc. Msuite helps you to obtain data from   all of these documents. This tool has a very high accuracy rate for data extraction, It is 100% in case of digital documents. If the document has an OCR less than 90%, this tool guarantees you about 98% accuracy in data extraction.
  • Rule Engine: Underwriters involved in mortgage processes need to have a thorough knowledge of all the present and fresh regulations, changes in compliances and the new rules. This platform is a very powerful way to manage a large volume of rules easily.

It doubles up as a rule engine and can be deployed as per your needs. This means that it will include only the rules that are relevant to the specific task. For example, this rule engine automates the mortgage underwriting task of reviewing files belonging to a certain type of loan applicant profile.

  • Report Engine: This platform does a perfect job of presenting the different reports required in mortgage underwriting. It also provides an analysis on the trends of all the automated jobs. It is efficient in creating reports that address all important parameters. Msuite generates reports customized to your mortgage underwriting needs. It has the ability to report on almost all the data points in the system.

Msuite reduces the dependency on underwriters for performing routine, workflow driven front, middle and back-office operations. It seamlessly performs the various mortgage underwriting tasks governed by a plethora of rules.

 Msuite allows you to carry out your mortgage underwriting tasks at an enormous scale, without having to make huge investments on infrastructure. One of its biggest benefits is that it works on both structured data and unstructured data.

How Do We Help You with Our Mortgage Underwriting Process?

Expert Mortgage Assistance is one the leading providers of mortgage underwriting services. Our cost-effective and automated solution Msuite, has helped both lenders and credit unions expedite their mortgage underwriting processes.

We provide you 24X7 support to meet all your mortgage underwriting back-office requirements. Our experts are well-versed with all the regulatory rules and compliances. Our standardized process and multi-tier checks for mortgage underwriting support ensures you receive high quality support.

Who We Are and Why Are We Considered as An Industry Authority?

This article is brought to you by Expert Mortgage Assistance an expert back office service provider for mortgage lenders. We have over 10 years of experience in providing mortgage underwriting assistance to over 200 financial institutions across the world. Our other services include closing and post-closing support, mortgage appraisal service, title support services, mortgage automation services etc.

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