Better’s new ChatGPT app targets lenders Rocket and UWM
Vishal Garg, Better.com
Source: Better.com
The online mortgage platform Better has teamed up with OpenAI to introduce an app within ChatGPT that promises to significantly reduce the time required for underwriting a mortgage or home equity loan, as reported exclusively by CNBC.
The app, set to be unveiled later today, merges Better’s mortgage engine with OpenAI’s models to expedite the underwriting process for loan officers at banks, mortgage brokers, and fintech companies, according to Better CEO Vishal Garg.
“Transforming the mortgage underwriting process, which many of us have personally experienced, from 21 days to as little as 47 seconds and deploying it via ChatGPT is a significant breakthrough for everyone,” stated Giancarlo Lionetti, OpenAI’s chief commercial officer, in a statement provided to CNBC. “OpenAI is thrilled to collaborate with Better in developing technology that revolutionizes the mortgage industry, making it more affordable, faster, and simpler for American families to secure home financing.”
For years, creating a mortgage has been one of the most time-consuming aspects of American finance, with lenders having to navigate through numerous steps that could take weeks to complete. Following the 2008 financial crisis, major banks like JPMorgan Chase retreated from the U.S. mortgage market, paving the way for non-bank entities like Rocket Mortgage and United Wholesale Mortgage.
Upon the news, Better’s stock surged by up to 5%, while Rocket Mortgage shares experienced a decline of over 6% and UWM shares dropped by nearly 4%.
Disruption risk?
Garg mentioned that the new app signifies Better’s shift from being primarily a consumer lender to also serving as a “mortgage-as-a-service” technology platform for other mortgage entities.
The companies are directly challenging the dominant players in the mortgage industry by empowering competitors to expedite their processes, Garg explained. According to Better, lenders can save an average of 21 days, cutting down the costs of underwriting loans and ultimately benefiting consumers financially as well.
“AI is now revolutionizing the mortgage sector,” Garg emphasized. “Companies like Rocket, UWM, Pennymac, among others, which are major publicly traded entities, generate revenue by essentially charging a 1.5% fee to underwrite mortgages. … That amounts to $20 billion paid by the American public in a typical year.”
By utilizing OpenAI’s models fueled with Better’s mortgage data, time is saved through simultaneous execution of multiple workflows involving appraisals, title reports, income, credit reports, and other criteria, Garg elaborated.
“It’s not just a simple tool call. It involves multiple tools with an extensive logic tree and a broad contextual scope,” Garg added.
