Artificial intelligence is integrating into everyday life at a rapid pace, shaping what people view on social media and internet searches, assessing job applications, assisting healthcare professionals with medical choices, and even determining eligibility for home mortgages.
Concerning the latter, Vanessa Perry, MBA ’90, is highly conscious of the implications this may have for consumers — especially first-time borrowers. Currently, Perry holds the position of interim dean at the George Washington University School of Business, where she also serves as vice dean for strategy and is a professor in marketing, strategic management, and public policy.
Perry offered her well-considered perspective to the Senate Subcommittee on Housing, Transportation and Community Development during a hearing focused on artificial intelligence and housing last year. Although historical discrimination patterns and disparities can jeopardize the impartiality of AI systems in the mortgage sector, Perry asserts that they can also enhance efficiency in the mortgage assessment procedure and, at times, offer more objectivity than human assessors. “One of my initial published studies examined automated underwriting — effectively an early iteration of AI,” she notes. “Our findings indicated that the AI-based system was fairer and more consistent for borrowers, including those from historically marginalized groups.”
While mortgage regulations may be intricate and obscure, Perry stresses that the advantages of homeownership are evident — contributing to her profound interest in the field. Apart from the financial uplift of increased equity to utilize, homeowners generally gain access to superior educational opportunities, healthcare, and beyond.
A common barrier for first-time borrowers in acquiring a mortgage is a limited credit history. A consumer looking for a mortgage to purchase a new home might be an ideal candidate for the loan but lacks a history with major credit bureaus. “With AI, there’s a wider array of data that can be utilized,” she explains. “You don’t need to possess a credit score, a credit card, or an auto loan, or anything that would integrate you into the conventional credit system.”
“That’s one illustration of the kind of advancement we experience because we have more data, and thanks to more advanced algorithms, we can effectively analyze combinations of data and consider alternatives. Without these AI tools, we lacked the computational capacity or access to data necessary to facilitate those developments.”
Though Perry has dedicated most of her career to academia, she has also engaged extensively in the public sector, acquiring a comprehensive understanding of the intricacies involved in implementing policy ideas and their impacts on consumers. Shortly after completing her MBA at WashU, Perry embarked on a four-year role as a financial analyst at the Federal Home Loan Mortgage Corporation, commonly known as Freddie Mac. “I completely fell in love with my initial assignments evaluating Freddie Mac’s affordable housing purchases,” she recalls.
Later, during her time at the Consumer Finance Protection Bureau, she played a significant role in the agency’s “Know Before You Owe” initiative, developing a simplified set of notifications to assist potential borrowers comprehend the terms of a mortgage. “It’s an excellent concept in theory, but in practice, it’s far more complex,” Perry observes. “It’s particularly challenging to condense 27 distinct pieces of information mandated by law.”
Perry notes that her academic pursuits and governmental work have mutually reinforced one another. “All my research has aimed to guide policymakers,” she explains. “In the classroom, recognizing some of the restrictions of policy has made me more effective, as I can inform students that ‘Yes, that sounds promising, but here’s why that’s not happening within our governmental establishments and why it can’t.’”
Despite the bipartisan nature of Perry’s career, the academic realm has always been her sanctuary. “My mother would tell you that as a child, I used to assemble my stuffed animals and deliver lectures,” she states. “I’ve evolved into a more effective professor because of the experiences I’ve been afforded in the regulatory arena, yet those roles have been purposely temporary as I have always cherished returning to campus.”
The post Artificial intelligence comes home appeared first on The Source.