Abstract
Artificial intelligence (AI) is poised to transform the mortgage industry. The potential efficiency gains are significant, as is the promise of AI to overcome human biases and the challenges of evaluating nontraditional financial profiles, more common for mortgage applicants of color. But reports across various economic sectors illustrate AI’s potential to perpetuate racial inequities.1 Without challenging or correcting for the underlying causes of bias in the data they use, AI models can simply perpetuate and embed racial inequality on a larger scale.2 In this report, we highlight current use of AI and its potential to achieve both efficiency and racial equity at several key steps of the mortgage process. In addition, based on interviews with industry stakeholders, we describe the mortgage ecosystem and the role various stakeholder groups play in influencing AI adoption and penetration. The analysis in this report is based on a qualitative research approach. The data collection included nearly 50 interviews with key stakeholders in the mortgage ecosystem. This includes staff members in the federal government, financial technology (fintech) companies, mortgage lenders, consumer advocates, and research organizations.