MISMO Panel Tackles How to Build a Roadmap for Responsible AI
(From left: Brian Vieaux, CMB, Devin Caster, Matt VanFossen and Rick Hill, via YouTube)
No tech topic is hotter right now–both in the mortgage industry and more broadly–than AI. Four industry experts took to the stage at the MISMO Spring Summit, held June 1-4 in Louisville, Ky., to talk about how the industry can make sure any adoption is responsible amid myriad risk.
Devin Caster, senior principal of product management, marketing and data solutions at Cotality, defined the “risk” posed by use of AI: “We’re not talking about the technical risks of the AI itself,” he said. “What we’re trying to help people draw out is: How does this lead to actual risks that lenders face, whether that’s financial risk, it’s reputational risk, it’s regulatory risk, and how are you exposing yourself through these.”
A path forward has to start with a good framework, the panelists said, which is a project MISMO is currently working on. “All risk frameworks are really, fundamentally, about being able to identify, assess and manage risk,” said Mortgage Bankers Association Vice President of Industry Technology Rick Hill. He noted that while there are a lot of robust frameworks out there, they may be too large for smaller companies or organizations.
“We created a framework, for mortgage, but based on [the National Institute of Standards and Technology], so we know it’s fundamentally sound,” he said, “but it’s structured to really support the mortgage industry.”
Matt VanFossen, CEO of Absolute Home Mortgage, described some of the challenges in making policies related to AI. The technology encompasses so many different functions and departments, he noted. “When we started on this project, what was imperative was giving the guidance to say: ‘Here’s a starting point,’ ” he said, also noting the need to survey vendors and classify risk.
Moderator Brian Vieaux, CMB, president of MISMO, asked the participants about current conversations related to AI in originations, essentially “agentic origination.”
There are a lot of facets there, VanFossen said. For one, even if the technology gets there, how will regulators respond?
Market pressures also will play a role, the panelists predicted. “Am I pro human loan officer, or not? I am pro human loan officer, personally, I am,” VanFossen said. But, he explained, something that weighs on him is whether another originator may take the plunge on newer technology, lower their cost to originate and pass his IMB by.
Those are tough considerations, acknowledged Hill. “We’re not trying to say in the framework, what somebody should or shouldn’t do. That’s not our place,” he said. “We want to make sure that folks have the conversations, document their thought processes around it, and then monitor.”
“The framework is not legal advice,” said VanFossen. “But it is meant to allow you to contemplate the avenues that you should be taking.”
MISMO Summits bring together lenders, servicers, regulators, insuring and guaranteeing agencies, GSEs and technology providers to exchange ideas and drive progress. The MISMO Fall Summit runs from Aug. 24 through 27 in Reston, Va.
