AI Has Another Job: Growth
John Paasonen
Mortgage lenders are right to focus on how AI can lower the cost to originate. But the bigger opportunity may be what happens when we use it to convert more opportunities, make producers more effective and create more value from relationships we already have.
By John Paasonen, Co-founder & CEO, Maxwell
I was sitting with the CEO of the mortgage division of a large bank recently. His team had just spent the better part of a day with PwC talking about AI. So I asked: “What was your biggest takeaway?”
“Cost,” he said. “It was all about driving down costs.” Then he paused. “That’s great. We’ve been working on our costs for years. But I sat here wondering: how can AI actually help me grow my business?”
I haven’t stopped thinking about that question.
For four years, mortgage leaders have been obsessed with the cost side of the equation. Volumes fell. Margins compressed. Excess capacity had to come out. Every CEO I know has spent extraordinary time figuring out how to take another dollar out of the cost to originate a loan.
AI is going to be one of the greatest tools we’ve ever had to do that. It will automate work that shouldn’t require a human and make loan officers, processors, underwriters and closers dramatically more productive.
But every CEO learns after enough years staring at a P&L: you can only cut so far. Cost cutting matters, particularly in the short term. But you win through growth.
That’s the second job for AI that I don’t think we’re talking about nearly enough. How can AI make your business not just more efficient, but more effective? If efficiency gives you operating leverage, effectiveness can give you revenue leverage.
I think there are at least three places to start.
Get More From Every Opportunity
Most lenders already have hard-earned sources of demand: real estate agent relationships, referral partners, past customers, bank customers, direct-to-consumer marketing and the leads their loan officers generate every day. The bigger question is how much more growth you can create from the opportunities already coming in.
Think about where a good opportunity gets lost. An agent sends over a buyer, but the LO doesn’t connect quickly enough. A borrower gets 70% through an application and stalls. Someone explores products and pricing, then quietly starts shopping somewhere else.
Small improvements are worth real money. Take a lender with 10,000 qualified opportunities that converts 10% into funded loans. Improve conversion by one percentage point and you’ve created 100 additional loans. At the roughly $386,000 average first-mortgage balance originated in Q2, that’s nearly $39 million in additional funded volume and more than $500,000 of incremental gain-on-sale revenue using the median Q2 margin across public peers tracked by BCG.
That’s where AI becomes interesting. What if your teams knew which borrower needed attention right now, who got stuck or which agent relationship had quietly gone cold? The opportunity isn’t to remove the human. It’s to help the human show up at the moments that matter, with better information and context.
Before spending another dollar finding your next thousand leads, ask what AI could do with the thousand opportunities you already have.
Get More From Every Producer
Mortgage CEOs already know one way to grow: recruit more loan officers. But what if AI could help the producers you already have become the best sellers they’ve ever been?
Our industry spends enormous amounts trying to make sellers incrementally better: coaches, conferences, scripts, playbooks, training programs and sales managers. We do it because small improvements in producer effectiveness create tremendous value.
“What if AI could help the producers you already have become the best sellers they’ve ever been?”
Selling a mortgage isn’t getting simpler. HomeLight found that a third of prospective borrowers are asking about down-payment assistance or lower-down-payment programs, while 45% of lenders are often or very frequently asked about zero-down mortgages. Common misconceptions remain basic: needing 20% down, believing rates are headed back to 3% or 4%, or assuming homeownership simply isn’t possible.
The best loan officers navigate that complexity exceptionally well. They ask better questions, explain tradeoffs and help borrowers see a path forward. AI gives us an entirely new tool to enhance that human performance.
The early economics are worth watching. Rocket has reported its loan officers handling nearly 40% more clients than a year earlier alongside investments in AI-powered LO tools. loanDepot reported an 18% increase in funded loan units per loan officer. It’s early days, but those are the metrics I care about.
There’s a recruiting implication too. One of our clients tells top-producing teams they will close more loans and ultimately earn more at their company than somewhere else. Their average LO closes 6.8 loans per month. Imagine how powerful that pitch becomes if your technology actually makes great producers more effective. Ask: How can AI make every producer better at winning, advising and converting business?
Get More From Every Relationship
You have another growth asset hiding in plain sight: the customers you’ve already spent money and time to acquire.
That might mean a servicing portfolio, a bank’s existing customer base or years of past originations. You’ve already earned some level of trust with these people. And then, too often, the relationship goes quiet.
Humans aren’t built to continuously watch hundreds of thousands of relationships and know when one suddenly becomes relevant again. AI changes what’s possible. A homeowner may not need another 30-year mortgage today, but she may benefit from a HELOC, be preparing to move or suddenly have a compelling refinance opportunity.
The economics are powerful because these are relationships you’ve already paid to create. Rocket said existing servicing customers accounted for 57% of its Q2 refinance closed volume. PennyMac reported government first-lien refinance recapture reaching 59%. loanDepot reported a 68% recapture rate across its 465,000 servicing customers, with $0 customer acquisition cost.
At Maxwell, we’re working on this directly through our strategic partnership with Ardley. Their technology can analyze a lender’s servicing portfolio or historical originations, combine it with current property and market data and identify borrowers who may have a new financing opportunity. We can then connect those opportunities into Maxwell’s point-of-sale experience.
That’s revenue leverage: finding economic opportunity inside relationships that already exist.
Put AI on the P&L
This is where CEOs need to get practical. You don’t need another dashboard telling you how many employees opened an AI tool or how many pilots are underway. Those may be useful adoption metrics. They don’t tell you whether AI made the mortgage business any better.
For every meaningful AI investment, I’d ask three questions: What business number are we trying to move? What is that movement worth? And how will we know AI actually helped move it?
“Capacity created is not the same thing as value captured.”
Say an AI tool eliminates 30% of the manual work your processors perform and creates capacity for another 400 loans a month. That sounds terrific. But if you’re still funding the same number of loans with the same headcount and overtime expense, nothing has hit the P&L. You’ve created capacity, not captured value. Decide upfront what you intend to do with it: take out cost, absorb more volume without hiring or improve service enough to increase pull-through.
And don’t confuse improving one step with improving the business. AI might cut underwriting touch time by 30%, but if appraisal turn times are still the constraint, you probably have created idle capacity. Mortgage is a chain of dependencies. The goal is to move the constraint limiting revenue, cost or capacity.
Finally, decide how you’ll prove impact before you roll the capability out everywhere. Mortgage is too volatile for simple before-and-after comparisons. Rates move. Seasonality changes. Mix changes. Hold back a comparable group, stagger the rollout or compare similar borrower cohorts. If you can’t answer “Compared with what?”, you probably don’t know what return the AI created.
An hour saved is useful. But an hour saved isn’t a financial outcome. What your business does with that hour is.
Start Asking a Bigger Question
I keep coming back to that CEO’s question: “How can AI actually help me grow my business?”
AI is arriving at an incredible moment to make mortgage dramatically more efficient. We should embrace that opportunity. But that’s not the limit of what AI can do.
What happens when it helps lenders understand why qualified borrowers are sitting on the sidelines? When it helps match consumers to products they didn’t know existed? When lenders identify emerging pockets of demand earlier? Or when a great loan officer can serve twice as many relationships while delivering a more personal experience, not a less personal one? We shouldn’t pretend to know all of those answers yet. We are still extraordinarily early.
Keep asking how AI can make your business more efficient. Then ask another question right behind it: How can it make your business more effective?
Those are questions we’re spending a lot of time on at Maxwell. And I think we’re only scratching the surface.
After four years spent asking how to make mortgage smaller and cheaper, AI gives all of us in the industry permission to ask a much more exciting question again: How do we grow?