Inman: Mortgage lenders are turning to AI to play in the big leagues

August 15, 2025

By Matt Carter

Mortgage giants like Rocket Mortgage and United Wholesale Mortgage aren’t alone in anticipating that if business picks up as mortgage rates fall, AI will help them scale.

The prospect that lower mortgage rates will fuel more homebuying and refinancing also has mid-size lenders shifting their focus from cost-cutting to investing in AI and other technology that can help them streamline business practices.

That’s according to a Fannie Mae survey of 240 senior executives at lenders of all sizes, which revealed that it’s not just giants like Rocket Mortgage and United Wholesale Mortgage who see technology as key to scaling their business.

Fannie Mae’s latest Mortgage Lender Sentiment Survey, conducted in early May and published Thursday, revealed that business process streamlining is the first or second priority for 37 percent of mortgage lenders.

That’s up from 29 percent a year ago, when talent management and leadership (34 percent) and cost-cutting (31 percent) were the biggest concerns.

“Ultimately, the goal is to continue to find ways to do more at a lower cost,” an executive at a large institution said. That executive is looking to “find ways to incorporate and add tools like AI along with bots to help streamline and automate processes.”

Close to half of large-sized lenders (45 percent) — defined by Fannie Mae as companies ranking in the top 15 percent with more than $295 million in 2024 loan originations — said business process streamlining was their first or second most important priority.

Mortgage lenders’ top business priorities

Source: Fannie Mae Mortgage Lender Sentiment Survey.

“Our focus is to streamline from application submittal through closing. We are looking at our entire operations process,” an executive at a mid-sized lender said.

More than four in 10 mid-sized lenders (44 percent) — companies in the top 35 percent with $53 million to $295 million in 2024 originations — said business process streamlining was a top priority.

At smaller institutions with annual originations of less than $53 million, business process streamlining was ranked as the number three priority, behind talent management and leadership (31 percent) and cost-cutting.

“We would like to continue to streamline employment / income verification and try to use Encompass tools to automate simple tasks,” an executive at a small institution said.

While not viewed as urgently as it was a year ago, cost-cutting still ranked as the second-highest priority among the entire survey group, with 29 percent of lenders saying it was their first or second-highest priority.

Where mortgage lenders plan to cut costs

Source: Fannie Mae Mortgage Lender Sentiment Survey.

Cutting back-office staff — a task often enabled by technology — was the first or second priority for 59 percent of those who said cost-cutting was a priority, up from 49 percent a year ago.

Among the 27 percent of lenders who said investing in consumer-facing technology is a high priority, many cited the potential savings they hoped to realize from such investments.

An executive at a small lender said their goal is to have consumers “submit and be able to get a response to a self-directed application process with the assistance of the [loan officer] through [Desktop Underwriter],” Fannie Mae’s automated mortgage loan underwriting system.

“AI to assist in all forms of communication, including scripting and self-service capabilities,” an executive at a large lender said.

Systems that can integrate with their loan origination system “to improve consumer experience and leverage to cut costs” are on the wish list of an executive at a mid-sized lender.

Business could boom

Source: Fannie Mae housing forecast, July 2025.

Forecasters at Fannie Mae think mortgage rates will drop to 6 percent next year — potentially boosting 2026 mortgage originations by 22 percent, to $2.34 trillion.

With many homebuyers still struggling with affordability issues, purchase loan volume is expected to grow by 12 percent next year, to $1.58 trillion. But Fannie Mae economists expect more dramatic 49 percent growth in refinancing, to $761 billion.

Rocket Mortgage is hoping to grow both purchase mortgage originations and refinancing through its July 1 acquisition of Redfin and its pending acquisition of loan servicing giant Mr. Cooper.

The company has set a goal of doubling its share of the purchase mortgage market to 8 percent by 2027, and boosting its share of the refinancing business to 20 percent.

If Rocket were able to hit its market share goal for refinancing at next year’s projected total addressable market of $761 billion, that would amount to $152 billion in refinancing business — 50 percent more than the company’s $101.2 billion in total 2024 loan production.

An 8 percent share of a $1.58 trillion purchase loan market would translate into an additional $127 billion in originations, or close to $280 billion in annual loan fundings — nearly triple what the Detroit-based lender did last year.

Rocket executives have said profitable market share growth is the company’s “North Star metric.”

To achieve that goal, Rocket is leaning heavily into artificial intelligence tools that will help the company rapidly grow its business when mortgage lending rebounds.

While mortgage lenders have traditionally needed to add employees during booms and shed them during busts, Rocket executives say AI will help it scale while keeping expenses flat.

Rival United Wholesale Mortgage, which surpassed Rocket as the nation’s biggest mortgage lender in 2022, is investing heavily in AI and other technology.

UWM’s LE Optimizer (LEO) provides a detailed analysis of competitors’ loan estimates (LE) and identifies opportunities for independent mortgage brokers to offer better deals.

“Mia,” an AI-powered virtual assistant that answers inbound calls and makes outbound calls, asking and answering questions, taking messages and scheduling appointments.

“Mia is designed to help loan officers do more loans and get more business,” UWM CEO Mat Ishbia said on the company’s Aug. 7 earnings call. “She is the ultimate loan officer. She works 24/7, 365 — she doesn’t get days off.”

Tech tools to compete

Amazon Web Services, Google Cloud, and Microsoft Azure have developed proprietary AI and machine learning capabilities that can be customized for lenders. And a growing number of vendors are offering technology, including AI, to small and mid-size lenders to help them compete.

Agentic AI mortgage technology startup Tidalwave is leveraging integrations with mortgage giants Fannie Mae and Freddie Mac and ICE Mortgage Technology to grow its stable of clients, including mortgage brokers like NEXA Mortgage.

In March, Xactus rolled out application programming interfaces (APIs), making it easier for lenders of all sizes to integrate with its AI-powered income and employment verification platform.

Mortgage technology provider Gateless — which builds on technology originally developed by AI Foundry to automate mortgage processes — also offers integration to income and employment verification providers through its flagship product, Smart Underwrite.