Mortgage brokers on chopping block as AI overhaul gains pace
Mortgage brokers could be the latest roles to be swallowed up by the spread of AI as homebuyers deploy modern tech in the space of cumbersome traditional homebuying services.
AI has taken a dominant role for buyers with over a third using the tech to explore their options. Early adopters cited AI as streamlining product comparison, opening access and decoding mortgage jargon – all historical roles for a broker.
The research, shared exclusively with City PM, also revealed nearly half of users found AI is the most useful tool to compare mortgage options.
Despite this surge among buyers, brokers have held off using the tech, with just one in eight using AI as part of their advice process.
Firms across the UK have leaned heavily into AI over the last year, with the Big Four accountancy firms – Deloitte, EY, KPMG and PwC – stripping back early-career hirings as they beefed up tech.
Meanwhile financial services firms are racing to bulk up their tech after data earlier this year revealed AI had risen up the ranks from the seventh to the most scarce tech skill across the sector – a 260 per cent increase.
FTSE 100 giant Lloyds has pioneered a push across the banking industry after sending 200 senior employees to an 80-hour AI boot camp at the University of Cambridge.
The lender has committed to tech expansion across its operations, with the launch of its ‘AI Centre for Excellence’ last year.
AI clouded with caution
Still, there remains a widespread level of caution across industries and consumers.
Whilst nearly half believed AI could be used to save time in the mortgage process, 30 per cent of respondents said they would prefer advice from a human broker.
One in ten said they would trust an AI-powered tool operating on its own.
Jacqueline Dewey, chief executive of Smart Money People, said there was a “disconnect” between homeowners and brokers priorities.
“The future of AI in mortgages is likely to be hybrid,” Dewey added, as consumers turn to AI for efficiency whilst maintaining some traditional uses of brokers.
Graduate roles are expected to bear the brunt of AI’s impact in the near term, with Dario Amodei, chief executive of industry heavyweight Anthrophic, prophesizing that AI could eliminate up to 50 per cent of all white collar jobs in just five years.
Vacancies for graduate roles, apprenticeships, internships, and junior positions have decreased by more than 30 per cent to pandemic-level lows since ChatGPT emerged at the end of 2022.