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Dain Ehring: AI Mortgage Genie Out Of The Bottle

Tuesday, June 21, 2022

In a recent piece published by DS News, Gate House Digital CEO/President Dain Ehring discusses the role of Artificail Intelligence (AI) in mortgage lending decisions.

Amidst significant momentum for the technology, Dain shares his insights on its increased usage within the mortgage market and opines that the “genie is out of the bottle.” Rather than looking backward, he argues it is time to push forward, albeit deliberately, in the name of expanding credit to qualified unbanked applicants, fair lending, and common sense.

While acknowledging a need for sound guardrails, Ehring strikes a cautious note against government’s preference for ambiguity in the guidance, a trend that stifles innovation and product development in the private sector, and often leads to capitulation to the legal risks of their ingenuity, and ultimately, producing “increased fees, fewer services, and diminished access to affordable credit for aspiring homeowners.”

“Without a thorough and prudent understanding of their appropriate role for the agencies, they could produce harmful unintended consequences,” Dain writes. “…Washington, D.C., must be careful not to wield a rusty axe, when a surgeon’s knife is more warranted.”

Dain warns that our oversight agencies need “not become a drag on the very thing most of our policymakers and government leaders want: mortgage financing available to families in need of affordable, quality housing, thereby creating more equitable homeownership.”

In a note of optimism for AI’s future in mortgage lending, Dain explains that “artificial neural networks” are helping to overcome the objections of its skeptics and critics. Can AI be “be free of bias” as the top regulator suggests, Dain asks: “Compared to what?”