Vishal Garg, Better.com
Source: Better.com
The online mortgage platform Better has partnered with OpenAI to launch an app within ChatGPT that the companies say will significantly reduce the time it takes to take out a mortgage or home equity loan, CNBC has learned exclusively.
The app, announced by the company later Thursday, takes Better’s mortgage engine and combines it with OpenAI’s models to speed up the underwriting process for loan officers working at banks, mortgage brokers and fintech companies, Better CEO Vishal Garg said in an interview.
“Cutting the mortgage underwriting process, which many of us have experienced personally, from 21 days to just 47 seconds and making it possible through ChatGPT is a huge unlock for everyone,” said Giancarlo Lionetti, OpenAI’s chief commercial officer, in a statement provided to CNBC.
“OpenAI is proud to partner with Better to create technology that revolutionizes the mortgage industry and makes it cheaper, faster and easier for American families to finance a home,” he added.
For decades, originating a mortgage has been one of the most time-consuming aspects of American finance, with lenders relying on dozens of steps that can take weeks. After the 2008 financial crisis, major banks like JPMorgan Chase withdrew from the American mortgage market, leading to the rise of non-bank players, notably Rocket Mortgage And United Wholesale Mortgages.
Higher-quality stocks jumped as much as 5% on the news, while shares of Rocket Mortgage fell 6% and shares of UWM fell nearly 4%.
A risk of disruption?
Today, at a time when leading artificial intelligence companies are targeting inefficiencies in the business landscape, it’s possible that AI agents could reshape a U.S. home loan market that generates more than $1 trillion in mortgages annually.
Garg said the new app is part of Better’s pivot from being a primary consumer lender to becoming a “mortgage-as-a-service” technology platform for other mortgage players.
The companies are directly targeting dominant mortgage players by allowing their competitors to move more quickly, Garg said. According to Better, lenders can save 21 days on average, reducing loan underwriting costs and ultimately saving consumers money, too.
“AI now does mortgage lending,” Garg said. “Rocket, UWM, Pennymac, a group of large public companies, make their money by charging a 1.5 percent tax to underwrite mortgages. … That’s $20 billion paid by the American public in a typical year.”
OpenAI’s models, powered by Better’s mortgage data, save time by running parallel workflows across dozens of checkpoints simultaneously, including appraisals, title reports, income, credit reports and other metrics, Garg said.
“This is not a single tool call. This is a multiple tool call with a very long and extensive logic tree and a very large pop-up window,” Garg said.
