9 Ways AI Chatbot will transform the Mortgage Industry
Introducing AI Chatbots as one of the revolutionary techs of 2023.
Technology, in recent times, has grown by leaps and bounds. There has been a massive shift in the way businesses operate and run their day-to-day activities. Changing customer behavior and increasing expectations have forced organizations across all industries to adjust and adapt to technological advancements. Not to forget the sudden outbreak of the pandemic that has further accelerated the pace of adoption.
Of all the technologies, AI chatbots are the ones that acquired maximum attention. From manufacturing to retail, IT, and healthcare, nearly every industry has moved up the ladder to integrate AI-powered solutions within their business. Similar is the case with the mortgage Chatbots in the mortgage industry.
In case you are not sure how to leverage the technology and improve the overall process of mortgage lending, you are in the right place. This article will explain how AI Chatbots can/will transform the mortgage industry. But before that, let's see what an AI chatbot is and what are the challenges faced by the mortgage industry that the bot can solve.
What is an AI Chatbot?
Remember the last time you visited a website, connected to the service agent, and then realized that the person you were talking to wasn't exactly a human?
Did it occur to you that you were talking to a computer program or something that acts like a human but isn't one?
Guess not, right?
That's the beauty of AI-based chatbots. They appear to be a lot like humans, acting and interacting with users in real-time. But that's not the truth.
Chatbots are artificial intelligence bots that simulate a conversation with the user. You can consider them to be programmed robots that can emulate and understand human behavior. The interaction done is in the conventional user language and can either be through messaging applications, on a website, or a mobile app.
Following the same idea, Mortgage Chatbots are one of the most promising use cases of human-machine interaction in the mortgage industry. Technically speaking, these are software codes that help automate a task (such as loan processing, providing information about a lender, etc) while in conversation with the end-user, serving them with the required information.
Types of AI Chatbots
Based on the type of algorithm used, mortgage chatbots could either be programmed to answer only the predefined things or progressively adapt to regulate their interaction.
The common types of AI Chatbots are:
- Support chatbots.
These kinds of Chatbots muster knowledge about a particular domain. It could be specific to a service, a product, or a business. That is to say, Chatbots have an in-depth knowledge of a domain. They must be aware of the intricacies of the subject, and be capable of guiding as well as assisting the users whenever required.
Let's say, for example, a user wishes to inquire about the mortgage lending process. Instead of only answering a yes or no, the bot must provide enough information to meet the user's expectations. The fact that bots emulate human behavior, it wouldn't be wrong to assume that support bots must answer all the queries as expected from the human agent.
- Skilled chatbots
Ever given a command to a bot? For example, Alexa plays music? Probably yes.
Whether knowingly or unknowingly, you just interacted with a skilled chatbot. To define, skilled chatbots are the ones that simply follow a command. They need not revert back with a textual response, instead act as directed. Embedded with NLP features, skilled chatbots act quickly and swiftly.
- Assistant chatbots.
Assistant bots are ones that lie midway through the above two. They know more than the skilled bots (information from diverse backgrounds) and are less effective than the support bots. It is expected that soon they would become the navigator and connect with other bots to perform actions in automation.
Assistant bots, to be precise, are better than the above two as they are both conversational and informational. When creating bots for the mortgage industry, it is best to opt for assistant bots. They can do a lot more than you anticipate. Mortgage chatbots will save you the efforts required to sift through different mortgage offerings, doing all of the heavy lifting itself. Offering product tips to suggestions, assistant mortgage chatbots act as a personalized guide.
Here’s a ready-to-deploy Smart skill for knowing the mortgage rates:
Statistics that vouch for the rising popularity of AI Chatbots.
According to a survey by Cognizant, the global value of the chatbot market would cross the mark of USD 1.3 billion by the end of 2025. The projected CAGR is 24%. (1)
Nearly, 37% of the AI start-up founders believe that in the next five years, chatbots would become the top-rated consumer application leveraging AI. (2)
A survey by Google Trends opines that the popularity of chatbots increased by fivefold in five years. (4)
- Finance is among the top five industries benefiting from chatbot technology. (5)
Major challenges faced by the mortgage industry and the need for an advanced solution.
Reducing the turnaround time of processing loans is one of the biggest challenges faced by the mortgage industry. No matter how complex the entire process is, customers always seek closure at the earliest. Hence, they need to work towards reducing the loan processing time and keeping it as little as possible.
Dynamically growing expectations
Users today do not just seek a flawless product/service but also a hassle-free interaction experience. With the conventional methods into play, meeting the demands and the expectations of users is becoming tough.
The 4 core values
Reassurance, transparency, simplicity, and speed are considered to be the core values during the mortgage journey. And meeting all of it at the same time is something that the industry lacks. To have a simplified application process, backed by reassuring customer support, with all of the data in hand (no eleventh-hour surprises), is what leaders must emphasize to convert more customers.
Inability to put data to use.
As mentioned above, the traditional methods are more manual and don't incorporate data into the decision-making process. This makes it difficult for the lenders to understand what the user expects. This is a major drawback given the rising importance of data, and the perks that come with analytics.
Working more from the in-house infrastructure with limited resources is another loophole in the mortgage industry. For one, it is hard to reach out to the global customer base. Even if that happens, serving them day in and out is a problem with time difference being the major hindrance.
AI Chatbots - Rethinking the foundation of the Mortgage Industry
Having said the above, it is clear that the industry needs to restructure its approach. This is where AI Chatbots come into play. As one of the advanced technologies, Chatbots have tremendous potential to transform the mortgage industry, and for the good.A few ways Mortgage Chatbots can disrupt the financial industry include:
Stay active 24/7 serving customers throughout the day. Chatbots are, unlike humans, not obligated to work 8-10 hours a day. They are programmed bots and active throughout the day (24/7). This helps serve the customers, irrespective of the time of day.
Connect and communicate with natural dialect. Often, users find it hard to talk in legal terms, failing to express what exactly they want. Mortgage Chatbots are designed and developed to understand the natural language of a human, decoding the simplest of the terms in the right manner.
Speed up the response time
Mortgage Chatbots help rev up the average response time. Being a computer program, the processing speed is high and even the processes executed are free from errors. This not only improves the line of operations but also accelerates the response time of a request eventually boosting productivity.
Mimicking human behavior, chatbots are human-like, thereby creating an impression that they can both understand and engage with the visitors in an interactive manner. Such a human touch improves the efficacy of the conversation, accounting for better leads.
Personalization at its best
Chatbots are like your personal assistants that will stay with you. Whether you want to inquire about your accounts or check the status of your loan, these digital agents will be there for you 24/7. Such a service stands out in the market helping you make a difference.
Automated Loan Assistance.
Instead of relying on humans to assist and guide users through the loan processes, users can now refer to mortgage chatbots. Survey results show that 60% of the customers prefer or are comfortable with online modes of application. Chatbots, along with their features, tend to simplify the loan origination process. Besides, considering that users seek 24/7 help and support, automated support increases the efficacy of the system.
Metrics to monitor engagements.
Chatbots aren't just conversational agents but at the same time, generate reports which provide insights on the customers. Analysts have the ease to study and assess these reports to identify potential prospects. Leveraging data is one of the best advantages of mortgage chatbots, one that redefines the scope of the mortgage industry (data to make forecasts and predictions).
Increase lead generation possibilities.
As known, different customers have different expectations and each behaves separately. For example, the first-time buyers would be naive and hesitate while picking a lender. On the other hand, experienced ones would know pretty well which lender to pick and why. Chatbots can understand what users are saying and when is the right time to close a deal. This increases the lead generation possibilities.
It is expected that the integration of Chatbots in the mortgage industry would cut 22% of the total cost by 2030. Since they can solve customer queries in automation with minimal human support, it reduces the need to have call center agents always available to handle user queries. As a result, the cost of operating the business reduces. In addition to the above, Chatbots are economical in the sense that they cost less as compared to traditional mobile applications.
To Sum Up
Mortgage Chatbots are an all-in-one solution to serve your customers. Starting with handling requests to assisting customers through the application process, educating them on the procedure, or helping them with the search operation, Chatbots can do all. To put it this way, Chatbots are not just a tool to automate user interactions but one that can transform the mortgage industries to deliver a top-notch customer experience.
Wondering how to get started with Chatbots for your business?
Haptik's Conversation Studio is one where all your search ends. As one of the leading platforms, we help design and build custom-fit Chatbots for your business. Our team takes into consideration the slightest of problems to come up with power-packed solutions. Get in touch to know more.