2020 created some new challenges for the mortgage industry. Among those challenges, was an increase in both the potential for fraud risk and the level of loan applications. While fraudsters have gotten smarter, fraud technology has mostly stayed the same. Which presents the question: how do lenders identify the highest risk loans for fraud, when the mortgage application volume is reaching historical heights?
Today's lenders need innovative solutions powered by advanced analytics and artificial intelligence to streamline loan approval and focuses efforts on the loans that matter the most.
Luckily, First American Data & Analytics has developed an enterprise level mortgage risk management solution that uses cutting edge, advanced decisioning technologies to deliver a highly accurate score and the truest picture of fraud and early payment default risk.
Identify Fraud & Early Payment Default Risk, While Significantly Reducing Review Volumes by as Much as 50%
AI Score, part of the division’s AppIntelligence Suite, delivers a highly accurate score that significantly reduces review volume and false positives and uses proprietary predictive modeling to paint a truer picture of where fraud and early payment default risk are likely to occur. For example, loans with the highest AI Score, usually about 10% of total application volume, account for 50% or more of total fraud risk. This targeting enables lenders to focus their reviews on the most at-risk loans, while streamlining loan approvals and reducing operational costs.
AI Score utilizes First American Data & Analytics’ proprietary predictive fraud indices, employing both natural and artificial intelligence machine learning technologies. It simultaneously runs proprietary sub-models for risk, including synthetic identity, income, employment, early payment default (EPD), undisclosed debt and loan participant risk review.
In addition, AI Score has a retro-scoring capability, so lenders can run a portfolio to identify which loans would have been flagged by the model. AI Score produces a scale of scores from low to high risk that can be customized to the lender’s risk tolerance. AI Score incorporates First American’s proprietary and consortium fraud data that tracks and evaluates millions of past underwriter clearances to evaluate risk level. This data is then fed back into the model for continuous machine learning.
AI Score is the newest addition to the growing, innovative First American Data & Analytics AppIntelligence Suite. The suite is powered by First American data solutions, the industry’s largest and most complete property information and ownership data. The suite provides critical analytics for fraud, verification, valuation and compliance featuring key solutions, including FraudGuard®, RegsData™, Vendor Management Suite and the Digital Gateway API.
Looking for a single source for mortgage analytics, risk, compliance and valuation? Visit https://dna.firstam.com/appintelligence-suite for more information on the First American Data & Analytics AppIntelligence Suite. To learn more about AI Score or to connect with one of our experts, go to https://dna.firstam.com/mortgage-risk-management.