Mortgage lenders and brokers deal with huge numbers of documents daily. The paperwork includes bank statements, tax forms, background check reports, and many more documents that must be considered carefully before the mortgage approval. The risk of error is tremendous, and so is the volume of data. How can it be solved?
This is where AI mortgage document processing technology steps in, offering a cutting-edge solution for mortgage automation of the extensive document analysis required in every loan phase. By automating document management and summarization, AI and ML tools streamline the workflow, improve efficiency, and enhance accuracy.
In this article, we describe:
AI mortgage document processing refers to the use of artificial intelligence to automate and streamline the handling of mortgage-related documents within the loan processing workflow.
AI mortgage document management can handle tasks like document classification, data extraction, verification, validation, analysis, data entry into the CRM or a database, document compliance check, etc.
In AI mortgage document processing, the backbone of efficiency lies in mortgage OCR (Optical Character Recognition) technology. OCR is responsible for the key tasks in mortgage document automation – recognizing the data from the document. This plays a pivotal role in enhancing the accuracy and speed of AI mortgage processing.
With the help of mortgage OCR, AI algorithms recognize and interpret mortgage documents, extracting relevant information (such as borrower details, property information, financial data) from text documents, scans, images, and other data formats.
In addition to recognizing and extracting the data, AI mortgage document processing tools can validate the accuracy of the extracted data, and facilitate decision-making processes for mortgage underwriting, loan approval, data verification, and compliance checks.
Moreover, some AI mortgage document processing tools also offer the possibility to automate data entry into the existing company’s CRM. By utilizing AI in mortgage lending, financial institutions can significantly reduce manual efforts, improve data accuracy, enhance operational efficiency, and accelerate the overall loan processing timeline.
“ 3 out of 5 of our clients come with the request to optimize document management in real estate, in areas like underwriting, mortgage document processing, or CRE brokerage. So, we've directed our focus on creating professional services like AscendixDA to help you deal with inefficiency of abstracting data. ”
AI mortgage document processing tools can handle a variety of documents, required for getting a loan, or providing finances to borrower and checking their credibility. The most common documents include:
The AI-powered system extracts approximately 90% of financial details from documents. It saves underwriters about 4.000 hours, so we close deals 2.5 times faster, which has become one of our main competitive advantages.
AI mortgage document processing involves several stages – from document upload to processing the result and fine-tuning the data. Let’s discover the process in detail.
First of all, the mortgage documents must be uploaded to the mortgage document automation tool. The documentation may also be retrieved from various sources like Loan Origination Systems (LOS), emails, FTP servers, company databases, Dropbox folders, cloud storage solutions, or any other integrated systems for storing data.
Mortgage OCR works by using AI algorithms to analyze images of text and convert them into machine-readable text. The OCR text recognition happens after the documents are already in the system, and it also includes several stages.
The final output of the mortgage OCR processing is a structured text that is easily managed, so can be further processed, indexed, searched, or analyzed.
While AI mortgage document automation tools are quite reliable due to the advanced mortgage OCR technology, AI still may make errors in extracting data, especially from complex or poorly formatted documents.
To ensure accuracy, AI-extracted fields that are questionable or unclear are reviewed by humans for accuracy. For this purpose, AI mortgage document processing tools offer Human-In-The-Loop (HITL) interfaces, where mortgage professionals can access the extracted data, review it against the original document, and correct any inaccuracies.
This approach of combining fully automated mortgage document management with human oversight significantly helps to improve the accuracy and reliability of the data extraction results.
As the process of mortgage OCR data extraction is finished, the data may be downloaded or integrated back into systems like LOS, compliance software, or analytics platforms, for further management, analysis, and usage.
AI mortgage document processing may include an additional step of automated data entry for companies that use CRM systems. After the data has been extracted, reviewed, and approved, AI can integrate it into chosen CRM systems, business databases, or other applications. AI data entry frameworks can be integrated into the existing software for streamlined data input or can be added as a new solution for mortgage businesses. This will lead to streamlined, efficient, and optimized processes in the company.
See how AscendixDA can extract key information from contracts and push it directly into your CRM.
Implementing AI in mortgage document processing isn’t just about technology—it’s about transforming your business operations. And transformations are never easy. There is a general roadmap that can help you to understand how AI implementation process typically looks like.
AI Integration Process | Source: Ascendix
Before implementing any mortgage AI solution, thoroughly analyze your existing mortgage document processing workflow. Identify bottlenecks, repetitive manual processes, and error-prone areas that could benefit from automation.
“ That's an important lesson for any enterprise that wants to implement AI. Ask yourself, "What can I do to impact my business the most now? Are there some pain points that I can address?" You have to understand yourself and your business. ”
Think of the result you want to get and establish specific, measurable, and achievable goals. For example, decrease data entry time by 25% (which is feasible, as CBRE’s experience shows).
Look into what AI can do. Someone has probably already solved your problem, and you do not need to develop a mortgage OCR solution from scratch.
“ You can't try to do everything at once. Pick one, two, or three pain points that you need to solve, and look to see if AI is ready to solve that pain. It may not be. That will be the recipe for a successful introduction of AI in your organization. ”
Suppose data extraction and entry, as well as mortgage document processing overall, occupy the lion’s share of your resources. In that case, Ascendix’s Intelligent Document Processing framework is probably what you are looking for. It is specifically tailored to real estate documents, including ones involved in mortgage lending. Also, there are a few other promising tools on the market, which we unpacked at the end of this article.
As Peter Drucker once said, “Do what you do best and outsource the rest.” Focus on decision-making, communication with clients, profound market analysis, and fostering new strategies instead of implementing mortgage OCR or other AI technology with which you have zero experience.
Things to Look for in AI Service Provider:
A knowledgeable partner will help with every step, from AI readiness assessment and choosing the right mortgage AI tools to staff training and future upgrades.
Ascendix has broad expertise in a few AI technologies and can guide you past pitfalls.
Work with your selected vendor to create a phased implementation plan. Start with a pilot project focusing on high-volume, standardized documents to see if mortgage OCR can fully recognize and correctly classify them or if additional training is needed. Plan for gradual expansion to more complex document types.
Start small, set clear milestones and realistic timelines, and seek feedback both from your AI service provider and your employees.
During this phase, your AI service provider typically prepares data for the most efficient mortgage document automation, which includes cleansing, sorting, labeling, and pre-processing.
Then comes the mortgage OCR configuration for your specific document types through training and fine-tuning.
The next step is integrating a new AI solution for mortgage document automation with your existing systems (LOS, CRM, etc.).
Experienced vendors always insist on establishing secure data handling protocols and setting up user access controls and audit trails to protect sensitive data. The final step at this stage is testing (accuracy, regulatory compliance, compatibility with your core system, user acceptance, etc.) and fixing errors.
Mortgage document management system is not the easiest solution to pick up, so provide comprehensive training for your team. Highlight that mortgage OCR is here to help, not to replace them—that will mitigate the main concern that can hinder user adoption.
“ “But if we really want our users to adopt the system, we have to think differently. We have to stay tuned to WIFM, "What's In It For Me," and that's what's in it for the broker. “ ”
Track your progress, gather user feedback, and document inaccuracies or misinterpretations to fix them in the future. Start training the mortgage OCR on more complex mortgage documents and expand functionality. AI moves fast, so you need to be careful not to end up with an inefficient solution.
Hire AscendixTech and we’ll create a tailored AI mortgage tool to bootstrap your processes.
Custom AI mortgage document processing tool is tailored to business needs and ensures high efficiency in those very processes that may have problems and highly need automation. Implementing a custom AI mortgage document automation solution offers a lot of significant benefits.
Ascendix combines AI technology with deep real estate and mortgage expertise to simplify document management and data processing. Our AI professional service AscendixDA, is designed to extract, validate, and categorize information from contracts, leases, appraisals, and reports. It turns static documents into structured data that can be used directly in your systems, reducing manual work while maintaining oversight.
Our hands-on experience in custom AI software development includes building frameworks for AI property search, AI lease abstraction, AI property valuation, AI data entry, AI recommendations engine, and AI chatbots.
How Ascendix Can Assist with AI Mortgage Document Processing:
Why Choose Ascendix for Mortgage Document Management Automation?
Contact Ascendix and automate your mortgage document management with tailored AI automation tools. Schedule a free consultation today to explore the possibilities of mortgage automation with us.
Contact AscendixTech and we’ll develop AI mortgage software that would ideally match your business needs.
AI in mortgage lending is used to streamline processes in document processing, including data extraction data analysis, risk assessment and optimal loan terms calculation. AI chatbots and virtual assistants improve customer service by answering queries, providing information, and guiding borrowers through the application process. AI in mortgage lending significantly accelerates workflows, improves accuracy, and enhances the customer experience.
OCR (Optical Character Recognition) in mortgage is a technology for converting scanned mortgage documents into machine-readable text. It automates textual information extraction from documents like loan applications, income statements, and tax returns. Mortgage OCR plays a crucial role in digitizing and processing large volumes of documents, improving efficiency, accuracy, and speed in document processing workflows.
OCR improves accuracy in mortgage document processing by converting static documents into searchable digital text and mapping data to corresponding fields in your core system, eliminating manual data entry errors. Advanced systems automatically extract critical information like borrower details and loan terms and validate the results against set rules to ensure consistency.
Mortgage brokers can highly benefit from AI document processing, data analysis, and customer interaction. AI technology streamlines the mortgage application process by automating document verification, data extraction from documents, data entry, data analysis, credit scoring, and risk assessment. AI algorithms can also identify and analyze market trends, assess borrower risk profiles and optimize loan portfolios, enhancing decision-making for mortgage brokers.
Yana is a proptech enthusiast and a technology fan. In her articles, she explores the world of real estate software, including proptech news, useful resources, and real estate technology insights, assisting everyone involved in the industry to modernize and optimize their business.
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