WEBVTT - Home Lending Pal: Disrupting the Mortgage Industry with Cloud and AI 0:00:04.400 --> 0:00:07.800 Welcome to tex Stuff, a production from I Heart Radio. 0:00:11.840 --> 0:00:14.440 This season of Smart Talks with IBM is all about 0:00:14.600 --> 0:00:18.480 new creators, the developers, data scientists, c t o s 0:00:18.560 --> 0:00:23.320 and other visionaries creatively applying technology in business to drive change. 0:00:23.800 --> 0:00:26.680 They use their knowledge and creativity to develop better ways 0:00:26.680 --> 0:00:30.280 of working, no matter the industry. Join hosts from your 0:00:30.320 --> 0:00:33.880 favorite Pushkin Industries podcasts as they use their expertise to 0:00:33.960 --> 0:00:37.480 deepen these conversations, and of course Malcolm Gladwell will guide 0:00:37.520 --> 0:00:39.839 you through the season as your host and provide his 0:00:39.920 --> 0:00:43.000 thoughts and analysis along the way. Look out for new 0:00:43.040 --> 0:00:45.480 episodes of Smart Talks with IBM on the I Heart 0:00:45.560 --> 0:00:49.159 Radio app, Apple Podcasts, or wherever you get your podcasts, 0:00:49.360 --> 0:00:55.160 and learn more at IBM dot com slash smart talks. Hello, Hello, 0:00:55.320 --> 0:00:58.640 welcome to a new season of Smart Talks with IBM, 0:00:58.680 --> 0:01:03.880 a podcast from pushed In Industries, I Heart Radio and IBM. 0:01:03.920 --> 0:01:08.440 I'm Malcolm Gladwell. This season we're talking to new creators, 0:01:08.959 --> 0:01:12.560 the developers, data scientists, c t o s and other 0:01:12.640 --> 0:01:17.960 visionaries who are creatively applying technology in business to drive change. 0:01:18.560 --> 0:01:22.360 Channeling their knowledge and expertise, they're developing more creative and 0:01:22.400 --> 0:01:27.759 effective solutions no matter the industry. Our guest today are 0:01:27.800 --> 0:01:32.759 Brian Young and Stephen Better, co founders of home lending Pal. 0:01:33.560 --> 0:01:36.720 Home lending Pal is a member of the IBM hyper 0:01:36.720 --> 0:01:42.160 Protect Accelerator, an investment readiness and technical mentorship program that 0:01:42.280 --> 0:01:48.480 supports impact focused startups leveraging highly sensitive data. Their story 0:01:48.680 --> 0:01:53.360 is a perfect place to start our season. They recognized 0:01:53.440 --> 0:01:57.720 a profound problem, the horrible process of getting a home loan, 0:01:58.320 --> 0:02:01.240 especially if you're part of an unders serve community, a 0:02:01.360 --> 0:02:05.400 process that, as you'll hear, is not only confusing and complex, 0:02:05.680 --> 0:02:10.160 but often deeply unfair. So Brian and Stephen teamed up 0:02:10.200 --> 0:02:13.680 to use technology to attack that problem in a bunch 0:02:13.720 --> 0:02:17.480 of creative ways. You'll hear how they're tapping into blockchain 0:02:17.760 --> 0:02:21.079 to make the home loan process more transparent and fair, 0:02:21.760 --> 0:02:24.880 using AI to help people learn how to qualify for 0:02:24.919 --> 0:02:29.120 a loan, and relying on IBM technology to store consumers 0:02:29.160 --> 0:02:34.520 most sensitive information safely in the cloud. Brian and Stephen 0:02:34.560 --> 0:02:38.480 talked with Jacob Goldstein, host of the pushkin podcast What's 0:02:38.480 --> 0:02:42.560 Your Problem. Jacob has covered technology and business for over 0:02:42.600 --> 0:02:46.720 a decade, first at The Wall Street Journal, then at MPR. 0:02:47.760 --> 0:02:58.880 Now let's get into the interview. Let's start this like 0:02:58.919 --> 0:03:01.760 a brom car How did you meet each other and 0:03:02.080 --> 0:03:05.040 decided to start a company together. Steven was supposed to 0:03:05.040 --> 0:03:07.680 come to a bachelor party in Miami and didn't show up, 0:03:07.840 --> 0:03:11.000 and it broke my heart. There's more to the story 0:03:11.080 --> 0:03:14.600 than just simply that one of my old employees introduced us. 0:03:15.240 --> 0:03:18.120 I've just left Marcato. They've been acquired for one point 0:03:18.120 --> 0:03:20.560 for a billion, and I am, you know, living the 0:03:20.600 --> 0:03:23.200 Miami lifestyle. You know, I have a condo on the 0:03:23.240 --> 0:03:25.880 water and all the nice things to go with. A 0:03:25.880 --> 0:03:28.760 guy named Michael Ramsey had asked me, you know what, 0:03:28.960 --> 0:03:32.000 I helped him do mortgage lead generation and I was like, 0:03:32.040 --> 0:03:33.840 you know, sure, I'm not doing anything else? Why not? 0:03:34.680 --> 0:03:38.000 And I meet Steve that he was in North Carolina. 0:03:38.560 --> 0:03:42.000 I left a pretty fruitful career in banking. I was 0:03:42.760 --> 0:03:46.120 an underwriter. Underwriting loans mean it's basically deciding who should 0:03:46.120 --> 0:03:48.920 get a loan and at what interest rate? Right, Absolutely 0:03:48.960 --> 0:03:53.040 due diligence, right, which is understanding whether or not this 0:03:53.080 --> 0:03:58.440 particular individual has the worldwithal to afford the mortgage. Also 0:03:58.640 --> 0:04:04.720 the credit risk individual presents. But there was this disconnect 0:04:05.280 --> 0:04:09.320 in that process where you have hidden action taking place 0:04:09.360 --> 0:04:12.440 on one side of the transaction while you have another 0:04:12.440 --> 0:04:15.000 side of the transaction that that tends to hide information. 0:04:15.960 --> 0:04:19.000 And just to be clear, it's the borrower who hides 0:04:19.080 --> 0:04:22.719 information and the bank that hides the action the lender 0:04:23.240 --> 0:04:27.000 in most cases, but this is usually both sides of 0:04:27.040 --> 0:04:30.800 the negotia. Everybody's hiding stuff from everybody else. There's a 0:04:30.800 --> 0:04:33.880 absolutely and it's like sort of inadvertent as well too, 0:04:34.120 --> 0:04:37.040 right in that process, and things fall through the cracks, 0:04:37.080 --> 0:04:40.279 and you know, falling through the cracks means weaks without 0:04:40.360 --> 0:04:44.320 notification from a bar's perspective as to whether or not 0:04:44.520 --> 0:04:47.440 you know this deal is moving forward. Okay, So so 0:04:47.480 --> 0:04:50.159 the problem is a lack of information on both sides, 0:04:50.520 --> 0:04:52.920 and that winds up leading to bad outcomes. It winds 0:04:52.960 --> 0:04:56.480 up leading to long delays that are frustrating or scary 0:04:56.600 --> 0:05:00.680 for the for the borrower, yes, who are of consumers 0:05:00.680 --> 0:05:03.840 just don't have anywhere to go if you go online, 0:05:03.880 --> 0:05:06.280 everything is too broad engineering, especially if you know you're 0:05:06.320 --> 0:05:08.479 not ready to buy at that moment. Uh. If you 0:05:08.520 --> 0:05:10.440 talk to a lender or relatory, if you're not ready 0:05:10.440 --> 0:05:12.479 to buy at that moment, there they'll help you, but 0:05:12.560 --> 0:05:14.240 it's not the same level of help. But you're not 0:05:14.240 --> 0:05:16.880 gonna get that same level of support over months because 0:05:16.880 --> 0:05:18.760 you know, buying houses and like buying a piece of 0:05:18.800 --> 0:05:21.840 candy online, And so we really looked at, Okay, well, 0:05:21.880 --> 0:05:24.919 how can we give people this safe environment to go 0:05:25.040 --> 0:05:28.479 explore and understand when homeownership could look like for them 0:05:28.560 --> 0:05:30.640 based on their personal information. And that's kind of when 0:05:30.680 --> 0:05:33.160 I reach back out to Stephen around August of two 0:05:33.200 --> 0:05:35.680 thousand seventeen and said, hey, you know, we need to 0:05:35.680 --> 0:05:38.960 do this together. You understand the back inside from a 0:05:39.040 --> 0:05:43.160 lender underwritish perspective, and I understand the plight of the consumers, 0:05:43.160 --> 0:05:44.880 and if we come together, this could be something that 0:05:44.920 --> 0:05:48.360 could be really unique. A capitalist solution to a social 0:05:48.400 --> 0:05:50.839 challenge is probably the best way to put it. So Stephen, 0:05:50.880 --> 0:05:53.760 you're sort of coming from the banking side, and Brian 0:05:53.839 --> 0:05:58.159 you're sort of coming from the tech side. Absolutely, what 0:05:58.320 --> 0:06:00.440 exactly is the problem that you've got us are trying 0:06:00.480 --> 0:06:03.440 to solve when you start this company, and its simple 0:06:03.480 --> 0:06:08.279 assessence is data democratization, the ability to take complex information 0:06:08.839 --> 0:06:11.479 and simplify so that someone that isn't an expert like 0:06:11.560 --> 0:06:15.880 Stephen can understand what's going on, and in this case specifically, 0:06:15.920 --> 0:06:19.880 what is the data that you're trying to democratize underwriting data, 0:06:20.000 --> 0:06:22.800 so the decision or the data that is utilized to 0:06:22.920 --> 0:06:26.000 determine whether or not you are approved or declined for 0:06:26.040 --> 0:06:29.360 a home loan. So right now, if I go apply 0:06:29.480 --> 0:06:33.000 for a loan, they approve me or they decline me. 0:06:33.880 --> 0:06:37.159 But do I know why not? Really? I mean, you 0:06:37.160 --> 0:06:39.560 get a letter of an adverse letter, but it's still 0:06:39.720 --> 0:06:42.120 very broad Engineeric, it doesn't really tell you what to 0:06:42.160 --> 0:06:44.920 focus on next, but you do have a very high 0:06:45.000 --> 0:06:48.760 level sense of why your decline. Yeah, there's no true 0:06:48.839 --> 0:06:53.800 guidance from that point of rejection, right there's no fundamental 0:06:53.880 --> 0:06:57.320 understanding as to what could I have done better? And 0:06:57.440 --> 0:07:00.160 that's really what sets this platform apart and all. So 0:07:00.360 --> 0:07:04.359 why it's important how we're sort of reframing of this 0:07:04.440 --> 0:07:07.120 data workflow. I want to get into the details of that. 0:07:07.200 --> 0:07:09.960 But just as we sort of understand the problem a 0:07:10.040 --> 0:07:11.960 little bit more, I mean, one piece of it that 0:07:12.000 --> 0:07:16.160 we haven't talked about is is race and the home 0:07:16.160 --> 0:07:18.480 ownership gap. Can you guys talk a little bit about 0:07:18.520 --> 0:07:21.119 that and how it fits with with what you're trying 0:07:21.120 --> 0:07:25.920 to do. Yeah, I mean, the home ownership gap, at 0:07:25.960 --> 0:07:29.240 least for African Americans is larger now than it was 0:07:29.320 --> 0:07:33.440 fifty years ago and segregation was legal, which is quite saddening. 0:07:33.480 --> 0:07:36.080 But it's not just African Americans. And when you look 0:07:36.120 --> 0:07:40.200 at declines, whether you are a woman, whether you are 0:07:40.240 --> 0:07:42.720 a minority, whether you're part of the l p G, 0:07:42.880 --> 0:07:46.040 t Q plus community, it shows that there's a higher 0:07:46.080 --> 0:07:48.960 level of declines for these communities than there are for 0:07:48.960 --> 0:07:51.600 for or white males. So you know, in our perspective, 0:07:51.600 --> 0:07:53.720 there has to be a lot that needs to be 0:07:53.800 --> 0:07:57.360 done in terms of resetting, reconfiguring the system to make 0:07:57.400 --> 0:08:00.440 it more fair and eggable for all. So, if I 0:08:00.520 --> 0:08:05.000 understand you correctly, you're saying, basically, in the current system, 0:08:05.160 --> 0:08:08.680 white men have an easier time getting a mortgage than 0:08:08.760 --> 0:08:12.040 anybody else. Well, you said it, I'll just agree with it. 0:08:12.720 --> 0:08:14.840 I think you said it. I think if I understood 0:08:14.880 --> 0:08:18.200 you're correctly said, yeah, that that is what the data shows. 0:08:18.360 --> 0:08:20.320 It's not just my perspect that's what the data shows. 0:08:20.400 --> 0:08:24.600 Is so, and so, how are you trying to help 0:08:24.680 --> 0:08:30.040 fix that problem by turning everybody into corn? By turning 0:08:30.040 --> 0:08:32.680 everybody into corn? I like it what do you mean 0:08:32.720 --> 0:08:36.000 by that? Through the power of math, right, cryptography specifically, 0:08:36.520 --> 0:08:38.760 we are able to make everyone look the same and 0:08:39.200 --> 0:08:44.880 the underwriter just simply understands the fundamental attributes that ought 0:08:44.920 --> 0:08:48.480 to drive that approval disapproval decision. Right, in order to 0:08:48.559 --> 0:08:52.240 help us and also to help our government understand where 0:08:52.280 --> 0:08:56.880 these biases are coming from, our lenders are required to 0:08:56.960 --> 0:09:00.200 ask you what your raise, what your sex, even your age, 0:09:00.280 --> 0:09:03.880 right Like, all of this comes with with this application scenario. 0:09:04.559 --> 0:09:09.640 But does this information inadvertingly create the bias? Can we 0:09:09.800 --> 0:09:13.480 make everyone look the same and start to remove or 0:09:14.400 --> 0:09:18.400 better identify where these issues are sort of coming from. 0:09:18.720 --> 0:09:22.400 So you're trying to use technology to blind all the 0:09:22.440 --> 0:09:26.440 decision makers in the home loan process to race, ethnicity, 0:09:26.559 --> 0:09:32.200 genre specifically blockchain. There are three big tech ideas behind 0:09:32.600 --> 0:09:35.520 home lending pal at least three of that we're going 0:09:35.559 --> 0:09:38.640 to talk about today on the show, and blockchain is 0:09:38.840 --> 0:09:41.640 big tech idea Number one. You may have heard of 0:09:41.679 --> 0:09:46.640 blockchain because it's the key idea behind cryptocurrency, but the 0:09:46.679 --> 0:09:50.280 idea of blockchain is bigger than just digital money and 0:09:50.400 --> 0:09:53.000 much more than just a new way to store information 0:09:53.040 --> 0:09:58.160 on the Internet. Blockchain is a shared immutable ledger that 0:09:58.240 --> 0:10:03.320 facilitates the process of recording transactions and tracking assets in 0:10:03.400 --> 0:10:07.880 a business network. Brian and Stephen want to use blockchain 0:10:07.960 --> 0:10:10.680 to gather up the information on race and gender that's 0:10:10.720 --> 0:10:14.319 required by law without showing it to the lenders making 0:10:14.320 --> 0:10:18.880 the decisions about who gets alone. Our argument or our 0:10:19.480 --> 0:10:23.000 thesis is that with the leverage of a mutable ledger 0:10:23.040 --> 0:10:25.480 such as blockchain, you're able to still collect the information 0:10:25.480 --> 0:10:28.640 that is necessary for the Home Mortgage Disclosure Act or 0:10:28.720 --> 0:10:31.840 HUMMED as Stephen was referring to. But then with a 0:10:31.920 --> 0:10:34.360 smart contract, you don't have to release that information, so 0:10:34.520 --> 0:10:37.360 after the decision, the approval of decline is made for 0:10:37.400 --> 0:10:40.280 the consumer. So you have this big idea for what 0:10:40.360 --> 0:10:41.679 you want to do as a business, which you want 0:10:41.679 --> 0:10:45.120 to do socially, but how do you make creative use 0:10:45.160 --> 0:10:47.760 of technology to do the thing you want to do 0:10:47.840 --> 0:10:50.520 to make it real? You know, we're trying to build 0:10:50.520 --> 0:10:53.240 something that hasn't been done in the mortgage industry, especially 0:10:53.240 --> 0:10:56.040 when talking about artificial intelligence and a virtual assistant. Most 0:10:56.040 --> 0:10:58.760 people think of that it's just a one way street. 0:10:59.240 --> 0:11:01.280 You know, we are trying to build this human like 0:11:01.440 --> 0:11:04.960 interaction where it is able to not only understand, but 0:11:05.080 --> 0:11:08.840 to respond, and then to leverage those responses and create 0:11:08.840 --> 0:11:12.199 a road map towards allowing you to achieve your goals, 0:11:12.280 --> 0:11:15.000 which is probably one of the most creative things that 0:11:15.120 --> 0:11:18.400 I've ever done personally. But it also requires you to 0:11:18.480 --> 0:11:21.199 be willing to accept constructive criticism from the people that 0:11:21.240 --> 0:11:24.200 are going to be using it up front, and a 0:11:24.280 --> 0:11:26.000 lot of what we're doing is really trying to find 0:11:26.000 --> 0:11:28.559 creative ways just to get them involved in that conversation, 0:11:28.600 --> 0:11:30.720 to say that, hey, you know, we are trying to 0:11:30.760 --> 0:11:33.440 build this to help you. Right now, there's about twenty 0:11:33.440 --> 0:11:36.840 one million mortgage ready millennials today that are qualified to 0:11:36.840 --> 0:11:39.960 buy alone, even though they're not trying. They just don't know. 0:11:40.280 --> 0:11:44.199 We're trying to bring greater trust and transparency to this process. Yeah, 0:11:44.400 --> 0:11:48.000 I guess from my perspective, beyond just simply understanding the 0:11:48.080 --> 0:11:51.800 technology and what it's able to do, I think it 0:11:51.840 --> 0:11:55.280 takes the will to go ahead and take on that 0:11:55.400 --> 0:12:00.959 complexity to try something new. We were child is constantly 0:12:01.240 --> 0:12:05.640 with why not a simpler solution? Right? But in reality 0:12:05.679 --> 0:12:10.040 the problem is much more complicated than the simplicity these 0:12:10.080 --> 0:12:13.560 forces wanted to bring it into the table. You have 0:12:13.640 --> 0:12:16.040 to have vision, you have to have a desire to 0:12:16.120 --> 0:12:20.080 want to make fundamental change. Yeah, new tech built on 0:12:20.080 --> 0:12:23.400 the old, broken processes doesn't allow for systemic change. You know, 0:12:23.440 --> 0:12:27.280 you have to try to find ways to not only 0:12:27.320 --> 0:12:29.600 just to make it easier for people to connect to lenders, 0:12:29.640 --> 0:12:32.000 but at the core of what we were trying to build, 0:12:32.000 --> 0:12:34.640 we really wanted to address the systemic issues in the 0:12:34.679 --> 0:12:37.280 home buying process, and that required us to try something 0:12:37.320 --> 0:12:39.800 different basically, and I think that's the most creative thing 0:12:39.840 --> 0:12:42.840 you can do in an industry that ticularly Stephen mentioned 0:12:42.840 --> 0:12:45.559 and wanted us to do is simpler. Yeah. So one 0:12:45.559 --> 0:12:50.200 of the ideas you guys have is that transparency can 0:12:50.200 --> 0:12:54.600 help reduce bias. So in what we are, you're using 0:12:54.679 --> 0:12:59.520 technology to bring more transparency to the home buying process. 0:13:00.600 --> 0:13:04.199 When we speak of transparency, when we speak of trust, 0:13:04.600 --> 0:13:07.320 where we're really talking about it is just the natural 0:13:07.960 --> 0:13:13.319 features of the blockchain. Right. It's transparent because all participants 0:13:13.760 --> 0:13:18.280 within this framework have access to this decentralized ledger, So 0:13:18.559 --> 0:13:23.240 we are all seeing how these pieces are sort of moving. Right, 0:13:23.280 --> 0:13:27.520 we're playing poker with our cards facing up when we're 0:13:27.559 --> 0:13:32.199 speaking to trust, right, we're speaking of the mutability of 0:13:32.240 --> 0:13:35.760 this information, knowing that if an action is taken, it's 0:13:36.120 --> 0:13:39.080 there on the ledger and we can't just simply remove it. 0:13:39.679 --> 0:13:47.000 So these features lead to this forceful curing of certain 0:13:47.040 --> 0:13:51.800 biases that tends to form within certain systems. Um, we're 0:13:51.800 --> 0:13:55.360 not saying that we're going to remove all bias, but 0:13:55.440 --> 0:13:58.080 what we're saying is that we feel very confident that 0:13:58.120 --> 0:14:02.960 we'll be able to reduce it said nificantly without regulatory 0:14:03.080 --> 0:14:07.280 reinforcement by the simple nature of this technology stack that 0:14:07.320 --> 0:14:11.880 we're developing. So was there some moment when you guys 0:14:11.960 --> 0:14:15.520 had the like light bulb, the high idea that you 0:14:15.559 --> 0:14:19.200 could do this. The moment that made me realize that 0:14:19.280 --> 0:14:22.120 this was doable was when our first group of lenders invested. 0:14:22.160 --> 0:14:24.800 There was a group called the Mortgage Collaborative. They are 0:14:24.840 --> 0:14:28.680 a collection of about three hundred five lenders I believe 0:14:28.720 --> 0:14:32.840 across the country. They represent about the overall originations that 0:14:32.880 --> 0:14:35.520 happened in the US. When they kind of stepped in 0:14:35.600 --> 0:14:37.480 and we're like, hey, you know, we're gonna lead your 0:14:38.200 --> 0:14:40.400 your development before your Series A, We're going to try 0:14:40.440 --> 0:14:41.880 to help you there. I think that was the moment 0:14:41.960 --> 0:14:44.560 for for me and then we had shortly after that. 0:14:44.680 --> 0:14:46.880 Joining that round was a group called Quo Mutual or 0:14:46.880 --> 0:14:50.320 CMfg Adventures their discovery fund, and they are the one 0:14:50.360 --> 0:14:52.960 of the largest collections of credit unions in the industry. So, 0:14:53.280 --> 0:14:55.640 you know, typically you have an issue where you know, 0:14:55.720 --> 0:14:58.640 consumers feel like there's a problem that's not truly being solved. 0:14:58.640 --> 0:15:00.840 But to see that lenders were looking to try to 0:15:00.880 --> 0:15:03.320 find solutions like ours, I think that was the moment 0:15:03.360 --> 0:15:05.400 for me. They said, hey, you know this could be 0:15:05.440 --> 0:15:07.840 feasible for us, that the people who will actually have 0:15:08.000 --> 0:15:11.400 to work with you want to help you. Like, that's 0:15:11.440 --> 0:15:17.440 exactly great, but just tell me how will it work? Like, 0:15:17.520 --> 0:15:20.440 walk me through. I'm an ordinary person. I want to 0:15:20.480 --> 0:15:24.240 get alone. I come to home lending Pal. What happens 0:15:24.560 --> 0:15:26.920 when when you're fully you know, fully up and running. 0:15:26.920 --> 0:15:30.600 How's it gonna work? Yes, So you will spend about 0:15:30.640 --> 0:15:33.720 five minutes going through our onboarding process where you're connecting 0:15:33.720 --> 0:15:36.960 your online bank accounts, you're authorizing and soft FCO. Cool. 0:15:37.480 --> 0:15:40.640 There's a credit report basically a credit report. You're here. 0:15:40.680 --> 0:15:43.200 Most people don't realize so so lenders are utilizing your 0:15:43.200 --> 0:15:46.040 FICO scores and most of the places online that you're 0:15:46.080 --> 0:15:47.960 able to go to your showing a vantage score. So 0:15:47.960 --> 0:15:50.160 that's kind of the first level of disconnect and so 0:15:50.200 --> 0:15:53.240 we're solving for that first. So you go to that 0:15:53.320 --> 0:15:58.000 process and then after you signed up, our virtual assistant 0:15:58.120 --> 0:16:02.960 keV begins doing his he's analyzing your profile. Uh. He's 0:16:03.000 --> 0:16:06.520 really a geared towards helping you understand really three or 0:16:06.560 --> 0:16:10.400 four critical elements. You know, one your likelihood for success 0:16:10.480 --> 0:16:14.480 or approval to some financial modeling and forecasts and give 0:16:14.520 --> 0:16:17.280 you a better understanding of when you should begin the 0:16:17.360 --> 0:16:19.480 process to apply for for a home. So how long 0:16:19.480 --> 0:16:21.920 will it take you to become a homeowner or to 0:16:21.920 --> 0:16:25.280 close on the the home? Three the best loan product for you, 0:16:25.960 --> 0:16:28.320 and then for the lenders within our ecosystem, they present 0:16:28.400 --> 0:16:31.120 the best chance of success with them as well. So, 0:16:31.320 --> 0:16:37.160 so you mentioned a virtual advisor, keV virtual meaning it's 0:16:37.200 --> 0:16:41.720 not a guy named keV, right, it's it's named after 0:16:41.760 --> 0:16:44.320 one of my my good friends from college that passed 0:16:44.320 --> 0:16:47.080 from a rare form of germ sale cancer. He's probably 0:16:47.080 --> 0:16:49.240 one of the most helpful, friendly people that you've ever met, 0:16:49.240 --> 0:16:51.720 and it didn't matter who you were, So we really 0:16:51.720 --> 0:16:57.560 wanted to encompass his personality into the solution itself. But yes, keV, 0:16:59.040 --> 0:17:01.440 it becomes a friend pal. You know, so even if 0:17:01.440 --> 0:17:04.000 you're not ready to buy, he just doesn't pass you 0:17:04.040 --> 0:17:06.120 off and say hey, I'm not going to help. It 0:17:06.160 --> 0:17:09.040 really analyzes your ber profile and begins to create a 0:17:09.080 --> 0:17:13.720 path that you can follow to become a homeowner. We 0:17:13.760 --> 0:17:17.720 have arrived at big tech idea number two. keV the 0:17:17.840 --> 0:17:23.560 Virtual Assistant is built using powerful artificial intelligence tools. The 0:17:23.720 --> 0:17:27.960 AI takes the potential homebuyers information and runs it through 0:17:28.000 --> 0:17:31.280 algorithms that tell you things like how likely you are 0:17:31.320 --> 0:17:33.960 to get alan, and what loan makes the most sense 0:17:34.000 --> 0:17:36.840 for you, and how long the whole process is likely 0:17:36.880 --> 0:17:40.320 to take. You can ask keV questions and it will 0:17:40.359 --> 0:17:43.520 give you answers. But keV is more than your average 0:17:43.560 --> 0:17:48.400 responder chatbot. It speaks conversationally, It knows who you are, 0:17:48.680 --> 0:17:52.800 understands your needs, and helps beyond just providing a frequently 0:17:52.840 --> 0:17:55.960 asked questions link. Brian says he thinks a lot of 0:17:55.960 --> 0:17:58.880 people might be more comfortable talking with an AI powered 0:17:58.960 --> 0:18:02.639 virtual assistant then with a human loan officer at a bank. 0:18:03.680 --> 0:18:06.439 I think it really solves a cultural problem there. There 0:18:06.440 --> 0:18:10.639 are cultural barriers that prevent different segments from becoming homeowners 0:18:10.720 --> 0:18:13.560 or at least impact they're buying decisions in terms of 0:18:13.560 --> 0:18:16.640 how they explore homeownership. So the first part is to 0:18:16.680 --> 0:18:18.800 try to use this virtual assistant just to make them 0:18:18.800 --> 0:18:22.400 feel comfortable getting into the process of what homeownership could 0:18:22.440 --> 0:18:25.400 look like. And then from there it is about preparing them, 0:18:25.400 --> 0:18:28.640 getting them better qualify so that once they are ready 0:18:28.680 --> 0:18:30.959 to say, hey, I want to come home owner, I 0:18:30.960 --> 0:18:34.800 found the house that I love, allowing that transaction, that 0:18:35.200 --> 0:18:37.840 process to be a lot smoother and easier through the 0:18:37.880 --> 0:18:41.040 use of blockchain. Basically, so when you say cultural, I 0:18:41.040 --> 0:18:45.520 mean does that include in part race and ethnicity, people 0:18:45.560 --> 0:18:50.720 who have traditionally been excluded from the banking sector from housing. 0:18:51.320 --> 0:18:54.040 Is the dream that sort of AI can help people 0:18:54.080 --> 0:18:58.360 who have been excluded become more included. Yes, most white 0:18:58.359 --> 0:19:02.520 people have resources. They have other friends and family who 0:19:02.520 --> 0:19:06.359 have gone through this process successfully multiple times as opposed 0:19:06.359 --> 0:19:09.560 to just the one time. Within our communities, is difficult 0:19:09.600 --> 0:19:12.840 just to find the one person that you can discuss 0:19:12.920 --> 0:19:16.040 this process with, and most of the time that one 0:19:16.080 --> 0:19:19.720 person has gone through a negative experience in that right. 0:19:20.000 --> 0:19:23.159 Brian's parents have experienced difficulty in this instry. My parents 0:19:23.400 --> 0:19:27.200 have experienced difficulty in this process too. Isn't until you 0:19:27.240 --> 0:19:30.879 get to our generation where you have family members that 0:19:30.920 --> 0:19:34.800 have gone through this process multiple times and have been successful. 0:19:35.200 --> 0:19:39.760 So when we speak to keV being culturally relevant, it's 0:19:39.880 --> 0:19:44.880 because keV is there to provide you accurate support that 0:19:45.080 --> 0:19:49.720 historically hasn't been available to these marginalized groups. Stephen, you 0:19:49.840 --> 0:19:54.440 mentioned your own families, your and Brian's famili's experience with 0:19:54.960 --> 0:19:57.400 getting home loans with the banking system. Do you guys 0:19:57.400 --> 0:20:00.080 mind us talking about that specifically? What have been in 0:20:00.119 --> 0:20:06.240 your family's experiences with getting loan? Yeah? Yeah, I mean 0:20:06.600 --> 0:20:09.159 back in the subprime mortgage crisis, and you know, my 0:20:09.200 --> 0:20:11.119 mom nearly lost her dream home that I bought for 0:20:11.800 --> 0:20:13.960 those primarily because we were in an arm even though 0:20:13.960 --> 0:20:15.680 we should have been an av A loan because she 0:20:15.720 --> 0:20:18.719 has a military veteran and an armed an adjustable rate 0:20:18.760 --> 0:20:22.240 loans that was way worse than the mortgage. It was 0:20:22.240 --> 0:20:24.120 way worse. I mean, you know, it started out better 0:20:24.200 --> 0:20:26.560 just because you pay less, but once that interest rate flips, 0:20:26.600 --> 0:20:28.919 it becomes way worse if you're not prepared for it. 0:20:28.960 --> 0:20:31.680 And I think you know, again, when when we talk 0:20:31.720 --> 0:20:34.600 about these cultural factors, there's really five that you deal with. 0:20:34.640 --> 0:20:38.080 There's there's cultural itself. So things like the subprime mortage 0:20:38.119 --> 0:20:41.440 crisis where African Americans are hurt the most coming out 0:20:41.440 --> 0:20:44.440 of that, you have red lining, reverse rate lining, etcetera. 0:20:45.160 --> 0:20:49.000 Red Lining is basically the history of lenders not making 0:20:49.080 --> 0:20:53.280 loans to people in predominantly black neighborhoods. Essential exactly, we're 0:20:53.280 --> 0:20:56.960 picking in which areas they will lend to specific groups. Yes, 0:20:57.000 --> 0:21:00.159 and those areas were predominantly white historically hamper dom wa 0:21:00.200 --> 0:21:03.439 why Yes. So you have those elements. You have the 0:21:03.440 --> 0:21:07.080 economic elements where there's this concept of its just being 0:21:07.240 --> 0:21:11.560 unattainable for us. You have the psychological elements of being 0:21:11.760 --> 0:21:14.080 misunderstood thinking that the only way I can buy a 0:21:14.119 --> 0:21:17.040 home is having down to put down towards of down payment, 0:21:17.440 --> 0:21:21.320 and that's just not true. So our ultimate objective is 0:21:21.359 --> 0:21:24.040 just really to make that more attainable for for everyone. 0:21:24.080 --> 0:21:26.120 And it's really for all load of monitor income borrowers 0:21:26.240 --> 0:21:29.560 these days, just because with rates increasing, with the supply 0:21:29.640 --> 0:21:32.399 shortages that we have, you know, homeownership is really going 0:21:32.400 --> 0:21:35.240 to become a lot more difficult for a lot of people, 0:21:35.280 --> 0:21:38.879 regardless of their age, sex, and race. So you have 0:21:38.960 --> 0:21:41.880 this industry that suffers from a lack of transparency, from 0:21:42.000 --> 0:21:45.200 historical bias in terms of race and gender. You start 0:21:45.280 --> 0:21:47.960 this technology driven company to try and fix those things. 0:21:48.280 --> 0:21:50.000 As you're building the company, how do you come to 0:21:50.040 --> 0:21:55.480 work with IBM um our need for data protection and security? 0:21:55.640 --> 0:22:00.919 So you're talking about digitizing documents, digitizing information to allow 0:22:01.200 --> 0:22:06.400 greater access to underserved underrepresented groups. And IBM had their 0:22:06.480 --> 0:22:10.480 hyper Protect Accelerator which was entirely focused on that, taking 0:22:10.520 --> 0:22:14.560 small startups like ours and allowing them to basically run 0:22:14.600 --> 0:22:17.680 the palace that we ran without having to worry about 0:22:17.680 --> 0:22:21.320 people's information getting stolen in essence, and then Steve and 0:22:21.359 --> 0:22:23.919 I were just very aggressive in terms of just reaching 0:22:23.920 --> 0:22:28.160 out to different vps, different executives at IBM, kind of saying, 0:22:28.200 --> 0:22:29.560 you know, here's what we want to do, here's what 0:22:29.600 --> 0:22:32.959 we need, will you help us? And being in an 0:22:33.000 --> 0:22:36.760 industry that is so regulated, it helped us really get 0:22:36.760 --> 0:22:39.560 to that door, just because you know, every bank has 0:22:39.800 --> 0:22:43.600 a vendor on boarding process that requires a very high 0:22:43.680 --> 0:22:46.480 level of data security to even work with them. In in 0:22:46.400 --> 0:22:52.000 in essence, here's the third big tech idea in the 0:22:52.080 --> 0:22:57.080 home Lending Pal story protecting data in the cloud. Think 0:22:57.080 --> 0:22:59.919 about the problem this one is solving. Brian and Stephen 0:23:00.119 --> 0:23:03.720 have this little startup. They need to collect supersensitive data 0:23:03.800 --> 0:23:06.640 from people. Everything you have to show the bank when 0:23:06.640 --> 0:23:09.800 you want to get a mortgage, This data has to 0:23:09.840 --> 0:23:15.040 be secure. IBMS hyper Protect Accelerator enables small businesses to 0:23:15.119 --> 0:23:18.960 store sensitive data in the cloud and keep that data secure. 0:23:19.800 --> 0:23:22.959 Brian says, it lets home lending Pal do something they 0:23:23.000 --> 0:23:27.280 would never do on their own. From a technical perspective, 0:23:27.320 --> 0:23:29.840 you have different compliance checks that you have to meet 0:23:29.880 --> 0:23:33.320 to work with banking institutions or financial institutions. So it 0:23:33.359 --> 0:23:37.000 allows a small startup like home Lending Pal to still 0:23:37.040 --> 0:23:40.240 be able to meet those checks and balances to bring 0:23:40.320 --> 0:23:44.040 an innovative solution to the table for a financial institution, 0:23:44.119 --> 0:23:46.439