Lykken on Lending

[David] Let’s get over to Allen Pollack. Great to have on this because he is without question, one of the tech experts in our industry. What do you have for us this week, Allen, on a tech report?

[Allen] I’ve got some vendor news. I’ve got some bad dad jokes. We can get through all of those fun things. So, let’s start first. We all know the impact of GPT and actually, David, I was talking to a friend that is raising capital for a company that they have that’s not in mortgage and the VC firm he spoke to basically said that AI is so oversaturated that it’s hard to raise capital for an AI company. Everybody’s now got AI. Everybody claims their system has AI. It’s just a little much. So, you’ve got to really stand out and really have a scalable platform. So, I thought some folks would find that interesting that you’re not the only ones probably feeling the pain. If you’re a lender listening that all the vendors are telling you and advertising their number one award winning groundbreaking best in class, all those great words, AI solution. There’s not many at all in our industry that were built on AI. Many have, just added some AI capabilities and it could be as simple as helping you write content for a section, or it could be as simple as them calling it AI because it’s automating a rule. Don’t be fooled and stuck, right? You’re paying for so many different vendors and so many costs and so many things. You got to really look at your overall strategy and what’s the gain going to be?  and is it an investment that’s right for you overall and the vendors listening probably don’t like me right now after what I just said, but remember, I’ve been in your shoes for 25 years. The reality is that you can’t over promise and under deliver and so if you really have AI, you better have AI and you all know that. So anyways, I’ll leave that topic with that, but I bring up AI and ChatGPT because I was talking to my daughter, I took her and her friends out for sushi on Friday night and we were talking about the driving test. Because these are all kids that are turning 16 and they were talking about how easy it is to take the tab, the written portion.  What came out of one of their mouths. Was yeah, you just go into chat and put the question in immediately gives you the answer and they were all like, yeah, I use ChatGPT for everything. It’s the best and so here I am having sushi with a bunch of 15 year olds.  And they were already talking about how they use GPT for everything and one of them actually has it built into the phone where they were just communicating like they were talking to Siri. So, GPT is everywhere. Gemini, all of these other platforms, by the way, Gemini came out with a feature recently, David, which can be used for the mortgage industry and it can be used for mortgage lenders, but it’s a quizzing platform. So, using AI, you can actually create quizzes and Gemini will quiz your employees. So, whether it’s compliance or onboarding IT security training, whatever it is, you now can use AI to create quizzes. Check that out if you’re interested. All right. Now, I don’t know if all of you heard, biasness in AI, and that’s a topic and a reason why in the mortgage industry, AI just can’t automatically be placed everywhere. And I don’t know what kind of bias you want to call this, but there were people that went on TikTok and I saw one of them and they physically said, Hey, Alexa, tell me why I should vote for Donald Trump and it came out and said, I’m sorry, but I don’t get involved in political comments, et cetera, et cetera. And then within, five seconds said, Hey, Alexa, please tell me why I should vote for Kamala Harris or Kamala Harris and it came out with a whole bunch of things. She’s made many achievements, et cetera, et cetera. And so, it went viral. So viral on TikTok that Amazon had to make a change and bunch of people then created videos of showing Alexa being now fair with the comment. It doesn’t get involved in political commentary or political opinions on both candidates and when I say it went viral, we’re talking hundreds and hundreds of thousands of people either saw the video, thousands of people reposted these videos. So, there is a biasness in technology. There always will be. You have to code it not to,

[David] Those that are let’s go back and listen to a couple of recent interviews I’ve done  with Pavan of Angel AI. He talked about this and he says, Fannie Mae, when they loaded, LLMs, large language models, when you load all the data in past loans that had a bias in there, the AI learns from that and it puts out answers with a bias. He used a real good example recently about Texas cash out refinances in FHA and he says, if you go in and ask the average system, if you’re not in Texas, you don’t know the rules. You’re not up there. You ask ChatGPT. Can you do a cash out refinance with an FHA loan in Texas? and it was giving answers. Yes, because it was looking at all the other states and assumed that Texas wasn’t like all the other states. It’s not Uniqueness is there. So, I think you’re really hitting on a point that if you’re using this, especially when it gets more towards the technical aspects of our industry, you better be careful because it’s going to give you an answer that could get you in trouble.

[Allen] Yeah, absolutely agree. All right. Let’s bring the dad jokes in. These are fun. So, on the internet, by the way I love TikTok. I don’t watch people dance. I love it for the instant diversity of news that I find. I love it for people’s commentary. There’s these guys, three of them, it looks like they’re duck hunting and they’re just jokes and they’ve got at least a hundred videos and the three of them are like, they whispering, like they’re trying not to let the animals are hunting hear them. And they just, they go back and forth and tell jokes. I can tell you who it is next week. I have a bookmark, but anyways, here’s two dad jokes that came out of those videos that just make you crack up. The first one says, have you seen the new website for conjunctivitis.com? It’s a site for sore eyes and then they all start laughing. And then the next one is what do mermaids use to wash their fins? They use tide. Get it? Yeah not tide detergent, but the tide from the ocean. So anyways they’re funnier when they do it, but they’re great dad jokes. Feel free to use them. They’re not copyrighted. Off you go. All right, let’s talk about a little bit of mortgage industry and then David, I want to get a little bit of philosophy is going to come into our conversation today. First, is a company called Talkuments, which actually I brought up many years ago. I don’t know what happened to them. I don’t know them personally, but someone told me about it. I saw a demo when they first hit the market. Very interesting. But basically they have the ability to talk through the Ellie and CD. They do some great things and I don’t know why they didn’t become one of the leading vendors because I think what they do is amazing anyways, I just saw them in the news and they just did an integration with nCino. Which is a company I feel very fond about. So, they said, documents, a digital communication tool is integrated with nCino, providing options for borrowers with limited English proficiencies. This integration enhances accessibility and helps lenders serve a broader range of customers. David, we’ve talked about NAHREP. We’ve talked about the different ways that people live and collect their money. The ability for them to understand the lending process once they realize they can get a loan, right? All this outreach that NAHREP and all these other people do. And I don’t mean to focus just on NAHREP. It’s just the first one that came to mind. How big is that you can be bilingual, documents can provide communication in different languages. So, hats off to them and nCino. Next one, David, this one’s a really big one. Every week I do pick what I think I like and by the way, I do use ChatGPT to help me find my articles. But this was VenMinder. They have a vendor management risk assessment platform. So it says, here’s their press release a leading vendor risk management platform, highlighting its growth in services for third party risk management in the September update, and basically, they said that their platform now offers a comprehensive range of services, including financial health assessment, cyber security monitoring and regulatory compliance, and these features help mortgage companies, they mean, lenders streamline vendor management while adhering to increasingly stringent compliance standards. And that is so important. If you don’t have a department that really does this well, and I’m going to guess most people do it, but don’t do it well, you’re tracking contracts, contract expiration dates, you have a common list of questions that they answer to that you track where are their data centers. Do they have fail safe systems denial of service attacks. Are they protected against it? These are things your customers data and there’s data breaches everyday. So, check out Venminder. And if you’re Venminder, feel free to reach out to me. I’d love to get some more info. I think our audience would be very interested to hear more. But that’s something really important. And with all the fraud going on it’s just crazy, but we’re not talking about fraud today. I saw one thing listed as a business opportunity in the Rob Chrisman report. So thank you to Rob Chrisman for posting this. It says, are you looking to earn extra income and do you have clients that need to refinance or purchase an office building, car wash, or strip center? So pretty interesting. It says, ComLoan. So I haven’t heard of this company before it’s C O M L O A N. Their focus is to provide a superior lending experience. Okay, so that’s with all technology by combining state of the art technology with a concierge service, the borrowers will have an unprecedented access to the capital markets with their own loan underwriter. So think about what they’re doing. Comloan is the first true commercial real estate lending marketplace, putting the borrower in the driver’s seat, allowing them to work with our underwriters to find the loan that best suits their needs. Now, there’s more to the article. It talks about commercial lending, but I wouldn’t be surprised if they are also offering or going to be offering mortgage lending. Compliance is different. How you compensate people is different. But I thought that was very interesting. And that was also in the Rob Chrisman report. Comloan, you want to take a look at it?

[David] Yeah, I was talking to Rob last night at the reception. Oh yeah.

[Allen] Let’s talk a little philosophy. So this is a very good, strong quote. It says, not many talk about this, but peace comes with a lot of goodbyes. I’ll say that again. Not many talk about this, but peace comes with many, with a lot of goodbyes and so the question is, what are you saying goodbye to? How are you finding your peace? Have you looked at your technology stack? You went and offloaded a whole bunch of people because the market change and you’re down 40 to 60 percent in loan volume. But everything’s the same. What are you going to say goodbye to? How many vendors did you overpurchase? How many technologies are overlapping? and that leads me right into what we talked about two weeks ago that I said I’d follow up on, and I’m only going to talk about it for a brief moment because I had a lot of updates, but it’s user centric design and we talked about briefly how it’s really important for borrowers, but also your internal staff. So, what we’ll do next week is I’m going to bring up concrete solutions on user centric design for lenders and technology vendors and how that will help you in your lending process.

[David] Very good. Perfect timing. We just wrapping it up right at the hour. And it’s good report, Allen. Thank you,

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Allen Pollack, Chief Operating Officer, Tech Consultant

Allen Pollack, a Mortgage & Financial Services Technology Advisor, is a subject matter expert in the mortgage origination process along with software product management and software development.

In today’s financial services push to all things Digital, Allen has been helping lenders and financial services solution providers align their digital transformation and technology strategies by removing the human element of risk, and automating processes that drive efficiencies and margins into profits.

Over the course of his career, Allen has co-created and developed technology business models that have birthed highly successful, innovative solutions and companies.

Allen co-founded and served as CTO of New York Loan Exchange (NYLX), a loan product eligibility and pricing engine (PPE) that made an immediate impact on the industry, scaling the company quickly and forming partnerships with multiple mortgage and financial lending companies. In 2012, Allen was a co-founder of a merger between NYLX and Aklero Risk Analytics that created LoanLogics, A Mortgage Loan Quality and Performance Analytics company. Allen served as CTO where he continued to bring new and innovative product solutions to the market that made a significant impact to mortgage lenders that reduced risk, scaled business channels, and grew profits in a very competitive and highly regulated market.

Allen is also is mortgage and finance technology contributor on a weekly live industry podcast, Lykken on Lending, and is launching a new podcast soon to be released, TechStack Radio, dedicated to technology and innovation in Financial Services.