AI vs. Human Underwriters: Who Will Dominate the Future of Underwriting?

AI vs. Human Underwriters: Who Will Dominate the Future of Underwriting?

The replacement of AI in place of humans has been a hot topic in recent years. In underwriting, everyone wonders if AI will take over Humans or if there is a balance to be struck between automation and human expertise. Let’s break it down.

The Growing Influence of AI in Underwriting

AI is changing the mortgage industry by streamlining once time-consuming and error-prone tasks. AI-driven solutions automate document aggregation, verify data, and enhance accuracy.?

AI’s ability to:

• Process vast amounts of data?
• Analyze complex income streams
• Cross-check documents quickly and accurately

has made it an integral tool for reducing human error, speeding up processes, and enhancing scalability.

The Strength of Human Underwriters

While AI is becoming more advanced, human underwriters still bring irreplaceable value to the table. Human expertise is essential for complex, nuanced decisions that require judgment, intuition, and a deep understanding of regulations.

In fact, a 2022 study by Housingwire found that although many have started using Automated Underwriting Systems (AUS) lenders still rely on human underwriters for cases involving complex, non-QM (non-qualified mortgage) loans. These loans often involve more subjective assessments that AI may not be able to fully comprehend.

Humans excel at:

• Judging context: Understanding the unique circumstances behind a borrower’s financial situation.
• Making judgment calls: Evaluating unique or borderline cases where AI might lack context.
• Regulatory compliance: Ensuring adherence to the constantly evolving rules and regulations that govern lending.

The Future: Collaboration, Not Replacement

So, will AI replace human underwriters? The answer is no - at least not completely. Rather than replace human judgment, AI should complement and enhance it.

AI’s role is to empower underwriters, allowing them to focus on the more complex aspects of their jobs while AI handles repetitive tasks like document aggregation, data analysis, and risk assessment.

In the near future, underwriting will be a synergy of AI efficiency and human expertise:

• AI speeds up processes and reduces errors.
• Humans focus on exceptions, compliance, and complex decision-making.

AI and Humans: A Partnership for the Future

Ultimately, the future of underwriting will be shaped by collaboration between AI and human professionals. As AI continues to evolve, its capacity to handle high volumes of data and complex tasks will enable human underwriters to work faster, smarter, and more accurately.

The question isn’t whether AI will replace human underwriters but how lenders can integrate AI to enhance human decision-making and drive better outcomes.

Ready to implement AI in underwriting? With TechMor, you can utilize the power of both AI and human expertise to innovate your underwriting process.