United Wholesale Mortgage (UWM) said it will use Google Cloud for AI and analytics in an effort to automate more of the mortgage process.
The partnership, announced ahead of Google Cloud Next, highlights how the mortgage industry is looking to transform with first party data and automation and reload for an eventual rebound in the housing market. The Google Cloud partnership with UWM also sets up an interesting technology battle given that Rocket, built on AWS, has acquired Redfin as well as Mr. Cooper in recent weeks. Rocket's goal is to acquire first party data that fuels its models and cross-selling opportunities.
For Google Cloud, the UWM win gives it another big financial services customer.
UWM has a technology platform that includes ChatUWM that is a borrower personal guide through loan documentation and processes and Trac+, which manages title review, closing and disbursement during the mortgage process
Key points about the Google Cloud-UWM partnership:
- UWM will integrate Google Cloud AI and machine learning in its lending platform that's used for underwriting automation, document processing and customer support.
- UWM is using Google Cloud's Gemini Flash 1.5 to enhance underwriting automation.
- The companies will explore Google Cloud infrastructure to scale capacity and enhance security.
- Google Cloud and UWM said the two companies will leverage AI to personalize loan recommendations and identify the right products for a borrower.
- The two companies will announce more technology integrations and products in the months to come.
The big picture
Rocket's acquisition spree (Redfin and Mr. Cooper) is notable because it's focused on buying the first party data that can be used in its models. However, there's an additional thread to consider here. Rocket covered why the acquisitions made sense based on 30 petabytes of data, but there are also good business reasons to make the purchases beyond training AI models. Rocket's acquisitions are based on industry consolidation and feeding the sales funnel too.
- AI? Whatever. It's all about the first party data
- Rocket Companies’ genAI strategy: Playing both the short and the long game
- Rocket Companies’ strategy: Generative AI transformation in turbulent market
The UWM-Google Cloud partnership has a similar ring to it and highlights how the battle between the No. 1 mortgage lender (UWM) and No. 2 (Rocket) is moving to AI and the cloud.
Here's what Ishiba said on UWM's fourth quarter earnings call:
"We continued to invest in cutting edge technology, including AI, investing in our people, and we're in the best position to capitalize on any change in the current market dynamics. There are about $2.5 trillion and growing in mortgage rates over 6%. And so it won't take much of a shift on rates for those loans to be in the money. No matter what happens to the market, we are focused on what we can control and making sure we are more prepared than our competition."
Holger Mueller, analyst at Constellation Research, said:
"The battle on which cloud your mortgage is being stored, serviced, analyzed and more is in full swing. As Google Cloud wants and needs to make progress to its larger cloud provider competitor and that happens with huge workloads. UWM is such a large workload and will become a substantial part of Google Cloud utilization, once all set and done. For UWM, it has a chance to use Google Cloud features and have both a leg up on the competition with a new implementation and new offerings. It can also build on the cloud platform that has 3-4 years of a lead over its competitors when it comes to what matters today, AI."