00:12From Chicago, I'm Allison LaForgia, and I am sitting down with Jay Kingsley, the president
00:18of Mortgage Solutions at Cotality.
00:20Pleasure to be here.
00:21Jay.
00:22Yes.
00:22As everyone gathers for this week, we're in the middle of Chicago.
00:27Market pressures are front and center.
00:29Higher rates, compressed margins, volume is hard to come by.
00:33When you're talking with lenders across the country right now, what's their genuine mindset?
00:38Are people leaning in, or is everyone playing defense?
00:41I think the general mindset is a lot like the runners that we see outside that just finished
00:46the marathon here in Chicago as we gather this weekend.
00:48They're tired.
00:49I think it was four years ago we were talking about the concept of survive until 25.
00:55And here we are in 2026 getting ready for 2027.
01:00But I think what has changed is you mentioned offense versus defense.
01:04And I think we're coming to a point here in the industry where it's less about offense
01:09versus defense.
01:09And it's really about is the technology meeting the moment where we can, instead of hiring
01:16up and then scaling back down, can we build the technology, the solutions fueled by the
01:22right trusted data and processes where we bring that scale to the industry, where we're not
01:27having to play offense versus defense, but having a stable, consistent process that's rooted
01:34in connected systems and data.
01:36Now, when you look at rebuilding that engine that powers all of this, we're still fundamentally
01:42answering the same questions that the mortgage industry has been asked for 50 years.
01:47Can the borrower actually afford the home?
01:49What's the collateral worth?
01:51And is the title clear?
01:52But how we answer those questions seems to actually be at a turning point.
01:56How are you thinking about that evolution?
01:59Well, what's interesting is those are still the right questions.
02:03I think we still have to understand the collateral, the credit, the capacity.
02:07And what I think is interesting is over the last couple of years, maybe we've been asking
02:11ourselves the wrong question so often in the last couple of years, it's this desperation
02:17of answering the question, how are you using AI?
02:20But I think we're now beginning to wrap our arms around that.
02:25I think we're not quite there yet.
02:26But we are returning back to some of those original questions.
02:31How do we take time, touch, and cost out of the origination process?
02:34How can we bring down the number of days and the number of dollars it takes to originate
02:41alone?
02:41And what we're doing is trying to help our clients with complete, connected, consistent
02:49data and tools that I think can really help lenders take advantage of, I think, the opportunity
02:55now to scale their business.
02:58Now, that connects directly with what you've described as the speed paradox.
03:03The industry has spent a fortune over the last decade digitizing mortgages.
03:08But turn times and production costs haven't really budged.
03:12Why is that?
03:14Yeah, it's very interesting.
03:15So one, I think we like to talk about the concept of velocity versus speed.
03:22So we describe velocity as both speed, but with an intentional direction.
03:28And for so long, there's been this pursuit of digital mortgage.
03:31And we're trying to do everything faster and pursuing this speed.
03:34But what we did was created some great tools.
03:37But they were disconnected point solutions.
03:42And really, we sort of talk about we've created a sea or sort of a set of islands of instant
03:51in a sea of disconnected processes.
03:54And so the question is, really, how can you start to bring consistency and connection across
04:01those points of speed?
04:04And what we're focused on is meeting lenders where they are with their solutions and knitting
04:10those together with fiduciary grade data and trusted processes.
04:14Now, Jay, how do you actually fix that handoff problem?
04:18And what bridges the islands that you just talked about?
04:21Well, one of it is, I'll repeat, which is fiduciary grade data.
04:26I think with AI, AI can work at speed, but with incorrect data, it can also make mistakes
04:35at speed.
04:36So we have spent a lot of time building our semantic layer, really investing in making our
04:45data AI ready.
04:46And then also putting it in platforms or capabilities so that we can meet lenders where they want
04:53to be, whether that's in a cloud and AI solutions, or even in the existing LOSs and POSs that
04:59they have today.
05:00Now, you've mentioned that hot word a couple of times now.
05:05And realistically, we cannot have a conversation in mortgage right now without actually talking
05:09about AI.
05:10But there's also a lot of skepticism.
05:14Some feel like it's mostly marketing buzz, while compliance and risk teams are naturally
05:19very curious about black box algorithms.
05:22How should lenders cut through the noise around this very noisy topic?
05:28I believe strongly that the opportunity is real.
05:31But your point around compliance and governance is, I think, one of the most important ones.
05:37And again, we've spent a lot of time building that data infrastructure.
05:43We talk about a concept of OAT, which is observability, auditability, and transparency.
05:50And while I think that AI does bring capabilities that is really going to help the industry, it
05:59only can be done if you are partnering with companies that have trusted data, trusted process,
06:06governance.
06:07And then that's when the speed actually, the connected speed can start to take place.
06:12So we're bridging those islands.
06:14That's right.
06:15So as we wrap up, thousands of mortgage leaders will be spending time in the next several days,
06:20meeting partners, catching up with peers, and preparing for the year ahead.
06:24If you could leave folks with one perspective to keep in mind as they have all of these
06:29conversations, what would it be?
06:31I think it's to be thoughtful and really embrace it in what we like to call complete, connected,
06:38and compliant.
06:39I think all of us want to pursue that speed.
06:44All of us want to embrace the AI.
06:47And I think the opportunity is there.
06:48But be thoughtful about it.
06:50Choose partners that you can trust, that are building scale, and that bring solutions that
06:57are complete, connected, and compliant.
07:00Jay, thank you so much for joining me and for getting into the market, technology, and
07:04for telling us how we should think about AI and how lenders should prepare for the year
07:08ahead.
07:09Absolutely.
