Newrez's CIO says most mortgage companies are doing the same work they did 20 years ago, just on a screen
The mortgage industry has spent the past two years talking about artificial intelligence, and most of the conversation has focused on which tools to use. One of the main issues for brokers and lenders now is to make sure they’re getting a return on investment on the AI tools they choose.
Because AI is such a buzzword across the business world right now, everyone is trying to figure out what flashy new technology is truly AI, and what is just a digital version of the same old process.
One mortgage executive who has worked through this problem firsthand frames it as the digital paperwork problem. Most mortgage companies today have websites, mobile apps, and modern software, but the actual work is still largely being done the way it has always been done.
Brian Woodring (pictured top), chief information officer at Newrez, joined the company a year ago with a mandate to build the most technologically advanced mortgage lender in the country, and said the industry has made the mistake of treating AI as an upgrade rather than a reinvention.
"For your typical mortgage lender or servicer, you've got a digital presence," Woodring told Mortgage Professional America. "But if you really look at it at your typical mortgage company, the actual work is largely still being done the way it always has been. You're just doing it on a computer."
The coat of paint problem
The mortgage process has always been very document-heavy. Woodring said it’s a missed opportunity for the industry if the idea of a technological advance is simply moving those documents to a computer screen.
"I often talk about the idea of digital paperwork where we got rid of the paper, but we didn't get rid of the paperwork,” he said. “We just moved it to a computer. So now people are just doing the same thing they did 20 years ago. Looking at documents, going into the LOS and filling it in. They're just doing it on a screen."
Woodring said that gap between the digital surface and the unchanged process beneath it is where AI ROI disappears for most companies.
"The biggest reason I feel like so many companies in our industry are struggling to find the value in AI is they're looking at it as just like putting on a coat of paint," Woodring said. "Like we're going to take everything we do today, same house, new coat of paint, slap some AI on it and then maybe they're expecting there's going to be some big ROI. But this isn't magic."
The fix, he said, is not a better tool. It is a willingness to rethink the work itself.
"Without being willing to think, consider, and really embrace new ways of working, I just don't think you're going to see the ROI," he said.
Critical leadership buy-in
Woodring said the process problem and the leadership problem are connected, and the second one is a critical hurdle to clear if true AI adoption is going to take hold in a company.
"I would say it is the single most important determining factor in whether you're going to be successful with a tech transformation is how much business buy-in you have," he said. "It's not just bringing in good tech. It's about being willing to go all the way into the processes that you have to run your business and be willing to transform them with technology. That's where you get the real value."
What that looks like in practice, he said, is leadership that is not just supportive of technology but actively engaged with it, demanding more of it and challenging how the business operates because of it.
"The difference between a company that's really a tech-first company and one that isn't actually has less to do with me and my role, and it has less to do with my team," he said. "What's really important is the buy-in from the leadership team. Are they tech savvy? Are they engaged with technology? Are they thinking about how you can do the business differently?"
The version of AI adoption that works, he said, is not technology being pushed out by IT but pulled in by business leaders who understand what it can do and are willing to change how they operate.
"AI is not an IT thing," Woodring said. "We're not pushing AI out on them and centrally trying to control all of it. We're creating the guardrails and the platform that allows our business partners to actually use AI themselves."
At Newrez, that has meant building a citizen developer program, putting non-technical employees through AI boot camps and giving them secure tools to build their own applications. Dozens of AI-savvy experts now sit across business units, not just in technology.
"When people think AI is just something IT is doing, that's going to really slow progress," he said. "It has to be something the whole company is doing."
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