[David] Allen Pollack’s here with the tech update. So much fun to have you, Allen. I listened to a really interesting podcast flying home from Tennessee last night. And it had to do with the House of Cards on the valuation of Open AI, and it really did a deep dive of going into it and saying how Gemini and the whole Google World is going to be paying attention to this. It’s is there an opportunity to short the whole open AI because of some of the struggles they’re gonna have? It was really interesting. I’ll send that out to you. I’ll put a link into it.
[Allen] Yeah. But first of all, I wanna know why on the airplane you weren’t listening to the technology segment by me himself during your flight.
[David] You know what? I just hadn’t gotten that one downloaded yet, so I apologize. You are so funny. I do listen, that sounds like an excuse. I go back and listen to it. And what’s also interesting is ’cause we break each one of our segments into, on our website, there’s a plug to go and listen to that. If you wanna listen to Allen’s segment or Alice’s segment, any one of our talk points we go into and we break them out on our website. So you should say, I wanna binge on Alice or on Allen or like what we’re talking about note rates, mid interest rates. You could go back and listen into what we’ve said over a period of time we put that out there. So that’s Ben dela Cruz’s hard work.
[Allen]Yes. David, I just had an idea. I think we should work on something and I’ll mention it here in public. But we should connect after, we should start generating a licking on lending AI bot where you can ask about any content and it tells you and brings you the episode that you can listen to.
[David] That’s a great idea.
[Allen] Whether whoever it was by. Let’s work on that. Alright, let’s get to some we gotta be using AI somewhere in the podcast., Let’s get to something. And I wanna bring up what you just mentioned, only because, listen, all of these AI platforms are continuing to grow every day. I’m gonna mention something today about the mortgage world and AI of course, but the platforms are increasing. The data centers are increasing, jobs are increasing related directly to ai. Is there an AI bubble? I don’t know it’s hard to say because let me give you these stats you always do this, you bring up stuff that I’m ready to talk about. So first, and that’s not bad, but I gotta bring something funny up first. Get this, and an AI judge was used in a small claims pilot. So a US county tested an AI tool to help settle traffic disputes. It gave faster decisions, but it apologized too much. So imagine the judge saying, you’re guilty. So sorry about that. That’s what they’re relating it to.
[David] Trying to make it all right. So that’s where Sam Altman tried to go back and add some humor because when he released 5.0 it was supposed to, it didn’t have the humor. Now it’s bringing back the emotional emotive, the more emo interest.
[Allen] This wasn’t in my list, but I had read something that there’s a restaurant where when you’re placing an order for items it gets sassy. So you know, if you’re taking too long to figure out the topping on your pizza, it’ll write back and say, it’s just pepperoni. Can’t you figure this out? Something like that. And I guess that gives a good laugh to people. But lemme get to this other one. So AI usage is exploding. This is the piece statement that I said, how did you know what I was gonna talk about? Over 61% of Americans used an AI tool in the last 12 months. And among people under 30, it jumped to 82%. That’s wild. Wow. Now, if you remember, when all the digital assistant came out, I was doing work at Fiserv, where we were trying to show how Alexa and Google assistant, and these things will help someday in the future. We’re way past that. 61% of all Americans have used an AI tool in the last 12 months. And there’s even information get this. Netflix says that 80% of what people watch is all algorithm recommended. You guys all know what algorithm recommended means, right? It means that some large language model, the algorithm is constantly learning and changing, and it’s deriving based on what you watch, what other people watch, your regions.
It has all kinds of information built in, right? So 80% of what people watch is algorithm based. And second, Spotify says that AI playlist now represent 65% of all total listening time. So for anyone to say that there’s an AI bubble, I don’t buy it.
[Kittle] No. There. There you finally get it. There’s where Les is getting his music from Spotify.
[Allen] That’s right. That’s exactly right. So I don’t buy the bubble piece just yet. Depends on how you think of what a bubble could be. I think that there’s an ongoing investment and it’s gonna continue. Let me bring up two more things and why I still don’t believe that there’s a bubble yet off id, okay. This is not specific to mortgage, but it’s a company. They are a biometric and AI identity vendor and they push what they call Agentic AI security. If you remember a couple weeks ago we talked about that big giant Agentic AI hack or security issue. So OFF ID, it’s an independent company. They recently announced a new framework, the OFF ID mandated framework aimed at offering a governance layer for AG agentic AI security, including support for identity verification to determine who is a human and not a human, it’s not gonna be those things where you have to look at the letters, like you can’t figure out and you get to keep hitting refresh and you just never get in and you give up. I don’t know how they’re doing it, but it’s gonna be very different. But get this, and this is why I’m saying there’s no bubble yet as of November 24th. Okay. That’s this week, David. Or seven days prior. They closed their first offering at $3.67 million to grow the expansion of this biometric identity platform. They had zero trouble. I’m not giving you all the details. They had a very quick turnaround, zero trouble raising their first capital raise. And they can get this identity done in 700 milliseconds. So meaning it is instantly fast. It will not slow down the experience. And they’re aimed at, they’re the first company to do it that at least I can find or that’s public. So very interesting for the mortgage world where we have ongoing right now agentic platforms and experiences that are expanding. This is huge news. Also, David, Mortgage, LLM. It’s a new domain, specific language model for the mortgage finance world. It’s on what’s called A-R-X-I-V. I don’t know how to pronounce it, but for anyone that’s listening, that’s possibly in tech or you’re gonna go run to your tech guys, it’s again, that’s A-R-X-I-V.
Now get this, it’s a new research paper. It was done on November 26th this year. It describes Mortgage LLM. A specialized large language model, trained for the mortgage finance tasks, specifically doc classification summarization, q and a. It can handle tasks directly relevant to the mortgage origination and the entire underwriting process. And it was built using what’s called a dual track specialization framework from a base model. And that means an expert submodel is optimized for structured tasks like classification, doc analysis, and conversational and QA tasks. So without going into further detail, what they’re saying is there’s another large language model out there. There’s a couple, there’s one on Google, there’s one on Open AI, ChatGPT. There’s a public one that people are using. A lot of people are building and trying to be the large language model of the mortgage industry. Here’s another one. It’s called Mortgage, LLM. These are gonna continue to come out, David, and what’s gonna happen, I’m not saying that lenders are gonna adopt this technology so quickly, but what’s gonna happen is we’re going to see a groundbreaking amount of things that increase, things that can be done better in our industry. Vendors that can be replaced. Yes or certain things that vendors offer that they don’t have enough, other things they do and all they offer can be replaced if it’s something very small with AI. In addition to that, So there’s a lot of people trying to crack the mortgage data, AI Workflow, Stratmoore and Mismo. I have to mention this. They have a session on data standards and AI guardrails. I know you just put out a podcast. Yeah. With Brian Vieaux. With Mismo. But you folks want to go check this out again. Stratmore and Mismo, they have a session. Go check it out. Also, I should mention this, Mason Mack, MAC, Mortgage Advisor Copilot, they just launched an AI tool that gives los information. Pricing decisions to elevate speed, accuracy, and confidence. I wanna say something, David. Every single week we mention another agent experience or another bot. Everybody’s messing and trying to get with AI and we’re only talking about the mortgage industry. How many industries are out there that people are working on trying to do the same. Again, why I don’t believe that we’re in the time of an AI bubble just now. I’m not an expert. But anyways, that’s what I think I wanna mention one other thing. A lot of things are going on in the Crisman report about AI technology. One thing that is noted that I saw a lot of is stack consolidation. Lenders are collapsing CRMs and POS systems and looking to do more of that, to ave fewer platforms, reduce costs and have fewer headaches. And you know what consolidation of the tech stack oes? It removes the confusion and it makes onboarding for originators a lot easier.
[David] And not to mention the vendor management component of that, the APIs and all that. There’s so many reasons why we’re gonna see, I think we’re gonna see a trend of continued consolidation within the tech space just because of just the complexities of bringing all this together.
[Allen] Absolutely. And by the way, consolidation doesn’t mean firing all your vendors and expecting one vendor to handle everything. It means that there also can be, in addition to doing that, there can be a lot of cross pollination across your vendors. That’s why if, and David, I’m gonna give you a shout out. If you’re a member of TMC. This is where you get to intimately be involved in a small group with those vendors, smaller presentations, smaller conversations. You’re not running around these giant conferences. And you can engage with these vendors to have better relationships and understand exactly what are they offering and bond better with those partnerships and common customers. That’s the whole point of TMC. Make sure that you’re involved in something like TMC. It’s very important. I have so much news, David, I can go on and on. The only other thing that I will bring up real quick is LO productivity tools, especially ai, they’re focused on database mining. Keep that in mind. People are trying to mine the data, look for opportunity, whether you have a CRM that does it, whether you do it, you need to bond and create and develop those relationships. And a lot of people are using AI for that.
[David] Yeah, a great point on that because there’s a real search in consumer direct lending. We’re releasing the podcast with Loan Pronto Roger Moore. And that was a fascinating in discussion and talking about data mining and all that. Everyone’s out buying leads, but we’re getting, again, more and more industry leaders are getting back into the consumer direct space And as they do, there’s gonna be this, how do you generate better leads? And this is where AI could come in and have a major, difference. So a lot of great stuff here. Allen, great report. Thank you so much. Appreciate it.
[Kittle] Allen, thank you very much for talking about TMC, but you’re exactly right.
[David] Absolutely. Good stuff. Good report you guys. Good discussion all the way around.
Allen Pollack
, Chief Operating Officer, Tech Consultant
Allen Pollack, a Mortgage & Financial Services Technology Advisor, is a subject matter expert in the mortgage origination process along with software product management and software development.
In today’s financial services push to all things Digital, Allen has been helping lenders and financial services solution providers align their digital transformation and technology strategies by removing the human element of risk, and automating processes that drive efficiencies and margins into profits.
Over the course of his career, Allen has co-created and developed technology business models that have birthed highly successful, innovative solutions and companies.
Allen co-founded and served as CTO of New York Loan Exchange (NYLX), a loan product eligibility and pricing engine (PPE) that made an immediate impact on the industry, scaling the company quickly and forming partnerships with multiple mortgage and financial lending companies. In 2012, Allen was a co-founder of a merger between NYLX and Aklero Risk Analytics that created LoanLogics, A Mortgage Loan Quality and Performance Analytics company. Allen served as CTO where he continued to bring new and innovative product solutions to the market that made a significant impact to mortgage lenders that reduced risk, scaled business channels, and grew profits in a very competitive and highly regulated market.
Allen is also is mortgage and finance technology contributor on a weekly live industry podcast, Lykken on Lending, and is launching a new podcast soon to be released, TechStack Radio, dedicated to technology and innovation in Financial Services.