To celebrate one year, we compiled the responses from our 12 special guests on year one of the podcast:

“What’s the one thing lenders should do to maximize profitability?”

Hear actionable insights from industry leaders – including Optimal Blue’s executive team, top economists, tech innovators, and mortgage strategists. From leveraging AI and data to mastering client relationships and optimizing pricing, this episode is packed with actionable advice for mortgage professionals looking to maximize profitability.

Featured Guests:

• Julian Hebron (Founder, The Basis Point)
• Rob Kessel (Founder, Panoramic Capital Advisory and Consulting)
• Erin Wester (Chief Product Officer, Optimal Blue)
• Sarah Wheeler (Editor in Chief, HousingWire)
• Shant Banosian (President, Rate)
• Selma Hepp (Chief Economist, CoreLogic)
• Agha Mirza (Managing Director and Global Head of Rates & OTC, CME Group)
• Mike Vough (Head of Corporate Strategy, Optimal Blue)
• Dave Savage (Founder, Mortgage Coach)
• Seever Sulaiman (CTO, Optimal Blue)
• Joel Kan (VP, Deputy Chief Economist, Mortgage Bankers Association)
• Joe Tyrrell (CEO, Optimal Blue)

Links and Resources:

• Subscribe to the Market Advantage data report: https://www2.optimalblue.com/market-advantage/   
• Follow Optimal Blue on LinkedIn: https://www.linkedin.com/company/optimal-blue/  
• Subscribe to Optimal Blue’s YouTube channel: https://www.youtube.com/@Optimal-Blue 

Commentary included in the podcast shall not be construed as, nor is Optimal Blue providing, any legal, trading, hedging, or financial advice.

Mentioned in this episode:

Optimal Blue Summit 2026 | February 23-25 | Scottsdale, Arizona

In case you missed it – Optimal Blue has announced the dates for its 2026 Summit! Join us February 23 – 25 at Talking Stick Resort and Conference Center in Scottsdale, Arizona, for a client-exclusive event packed with strategic insight and innovation. Attendees will gain early access to Optimal Blue’s latest generative AI and automation tools, dive into expert-led sessions on pricing, compliance and more, and experience hands-on demos of new capabilities. Plus, it’s a chance to connect with capital markets pros, integration partners, and mortgage insiders—all while gaining actionable strategies to maximize profitability and sharpen your competitive edge. The Optimal Blue Summit: where proven mortgage expertise meets modern innovation to shape what's next. Early bird registration is now open at Summit.OptimalBlue.com – space is limited, so register today! News release: https://www2.optimalblue.com/optimal-blue-to-host-its-2026-summit-february-23-25-in-scottsdale Registration: Summit.OptimalBlue.com

Summit - MA

AI at Optimal Blue – Innovation That Delivers for Your Bottom Line

Is your technology vendor selling real solutions – or just the idea of them? Too often, companies pitch big returns, offer free trials, and promise seamless automation, only to reveal during implementation that the tech doesn’t actually exist. At Optimal Blue, we take a different approach. Our AI-powered automation is already live, already delivering, and already saving lenders real dollars. We show you exactly where the ROI comes from and how it reduces risk – no vague timelines, just proven technology that’s working in production today. AI at Optimal Blue isn’t just about delivering software; it’s about empowering lenders to make smarter decisions, operate more efficiently, and stay ahead of the curve. Built around real capital markets challenges, informed by direct engagement with thousands of clients, and focused on delivering measurable value at no additional cost to clients, while others talk about AI, we’re delivering it – Innovation That Delivers for Your Bottom Line.

AI at Optimal Blue - MA

Our question to you is one thing.

What is,

your opinion.

do you think lenders should be?

doing

in today's market to maximize their profitability? I'm going to answer that one because it can be tech, can be customer relationships, et cetera. But I'm going to answer in a tech context because the basis point believes second half of 25 and 26 are going to be the start of the ROI phase of the FinTech era. The first 10, 12 years of the FinTech era was modernization, going from paper to digital. Now we're getting to the ROI phase and AI is a big, big part of that. So for retail shops,

Place the advice would be like place ROI from AI focus on underwriting and processing. Why? Because that's 21 % of today's 12,579 costs per loan. And AI can move the needle most here by just what we just said, getting quality files upfront, which reduces that check the checkers path from originations through post close, right? For direct shops, cost per lead.

is always a goal for profitability. And this in this tough part of the cycle, the direct shops have been doing really well pushing lead costs down, especially with the aggregators. But can they keep that cost down when rates drop and aggregators have more leverage? It's going to get harder. So how in a direct shop do you get to that profitability? I think that their focus actually would be on using AI to make LOs faster. So in retail shops,

using AI to make underwriting and processing more efficient. In direct shops, it's using it to make LOs faster and more efficient. What Jarvis is to Tony Stark, sales support AI should be to direct lender LOs. So they have accurate pricing and as Mike said, accurate pricing and guidelines. So they're quoting deals that close and then they have all the direct to source data upfront for faster pre approvals. So I think that matters because direct

lenders are about to have a massive run and that's what they need to work on most. then final note on this, for all lenders that service, having smarter servicing that can retain more than 24 % of refis and get closer to these category leadership levels of like 83 % retention, that means your customer acquisition cost goes away in the form of retention and that's a form of profitability. 100 % honest, completely

Transparent

beginning to end.

and

actually realize margin track.

Besides using Optimal Blue, which of course would be my paramount answer, I think the core thing that I feel like customers should really be asking themselves or technology users should be asking themselves is, am I using all of the products that I'm paying for to the maximum capacity that they provide and that fits my business needs? And those should be strategic conversations that they're having with every provider that they support.

and those providers should be having, you know, very complete and very thoughtful answers to those questions. So do not be afraid to ask them that that's one of our favorite questions here at Optimal Blue. We are eager to have those questions answered with our customers to be able to show them you're doing a great job utilizing 80 % of our platform. But let's talk about this other 20 % to see if this could really drive value. Because when you've been around for as long as we have, you know, we have a very deep

and wide breadth of feature sets at Optimal Blue. And we want to make sure every single scrap is used for our customers. And a bonus for folks who have the capabilities on hand or can contract out custom API implementations to support unique business workflows or secret sauce kind of scenarios, I think really gives customers a leg up on their competition. A vendor with a strong

API platform, proven API platform, I think is another really great way to ensure you're maximizing ROI. ⁓

should get the data. Nothing they can do.

data is not

where they can leverage the

for all these other things.

key and if depending if you're a small you start or whatever like your data is not in order it's the I

lender or whatever.

gonna don't

be

know how you're gonna stay at this.

business.

biggest thing that you can do to maximize your profitability is increase your client retention. Right? So you've got this amazing database that you've worked so hard for and so many people, most people don't even pay any attention to it. If I was to do, if I was to give you one piece of advice in terms of how to increase your profitability is become a master at communicating with your database of clients, right? That you've already done business with, that already know, like, and trust you, that have familiarity with you.

Like so many people spend so much time just trying to go and add new partners, new relationships, find new clients. Whereas like, you know, you've got maybe hundreds, thousands of people there that already kind of are watching you know you like you trust you that you're ignoring. Right. And so don't ignore those people. Find a way to communicate with them, whether it's the good old fashioned way of phone calling them. If you don't have a lot of those, ⁓ texting them, making sure you're letting them know how to watch you and catch you on social media, to

emailing them a lot, you emails not dead by the way, boring emails are dead, right? But like good content is still good content. People will read good emails, right? Like it's a, but if it looks like an HTML email that looks like a million people got it, nobody's going to read it. It's going to go delete it and then you're going to get unsubscribed. But if it's like good, fun, relevant content that somebody can put you to use, they find it valuable, not dead. They'll open it. Our email open rates are sky high. So number one focus and it kind of even goes in line with what I was talking about with predictive analytics, life events.

All that kind of stuff, like become a master at communicating with your database of people, however they want to be communicated with. And you don't know how they want to be communicated with. So communicate with them in all the ways.

That's a wonderful question. It's a very challenging market right now. as we talked about, originations are at historical lows and the macro economy is not helping in terms of mortgage rates. So it's very difficult. I always go back to sincerity of relationships. If I have a relationship with my lender and

He comes across to me as seriously caring about, you know, my wellbeing or wellbeing of my home. You know, it makes me more likely to go back to him for questions about refi, you know, to question for questions about, know, should I maybe, you know, sell by another home or buy a second home or, know, whatever the case may be. But like having that real connection, you know, I think, you know, in this, in this bots world, it's so hard to connect.

But having the relationship, think it's at the end really what matters the most.

I would suggest that the originators, mortgage lenders pay attention to and learn about the relationship between primary mortgage rates that the optimal blue index captures and the secondary market rates that market participants are used to. Market-backed security rates, TBAs, ⁓ swaps, and treasuries that they may be using or hedging with.

And what I mean by the relationship is that I personally would expect discussions or published content, be it from CME or Optimal Blue or industry strategists, some kind of discussion or hopefully ⁓ more significant research highlighting the relationship between primary mortgage rates and secondary rates. And if participants pay attention to that, then they can come up with their

own framework and their own rules of thumb or more specific analytic approaches to try and buy and sell instruments that are more advantageous for them. In our trading industry, that's called the concept of relative value trading or optimizing your risk management and hedging needs in relation to relative value trading. So I would

urge them to keep an eye out for that discussion or published content.

One, use the OVMMI mortgage rate feature. You can't have an MSR portfolio. You can't hedge long-term locks without, there's no other hedge out there like this. In our relationship with the CME, you can cross-margin different securities and you know exactly the data that's going into this index. And it's not using APR, it's not using any of these other things that you see out there. It's using actual lock data, which is an indication of actual prepayment potential.

In my opinion. that's, that's got to be number one. Number two, you to create your own proprietary range. You cannot be at the beck and call of a single investor. If you're using your pricing, you need to have a blend of all of your potential outlets in your front end pricing. So that would be number two. Number three, and I'll cap it at three. So I don't get yanked out stage is you need to move away from grid based pricing in your servicing valuations. You know, the servicing valuation.

is such a huge part of the profitability of lenders. And you need to be more dynamic than just X plus Y equals Z. It needs to be a cash flow based model that also counts for the different things that we see out there, such as different delinquency percentages that change over time. I handled the float point earlier, but in a high rate environment, that float differential could easily be five to 10 basis points in either direction. So that would be my top three things that lenders should do today.

that to be comfortable.

Yeah. So I mean, the data is just so clear on this, like the tip of the spear for lenders and where profitability starts is that conversation at the point of sale. And when that conversation at the point of sale ⁓ gets into the real goals of the family and when something other than a fee worksheet, here's your rate, here's your payment, here's your cash to close. But when you really show a presentation of value where you're showing options, you're showing the cost over time.

It's more profitable. mean, we've had lots of loan officers, excuse me, lots of lenders do an analysis where it's like people that obviously I'm with mortgage coach so they can see the loan officers that are delivering mortgage coach to all their credit reports. And the lowest increase in profitability I've ever seen was a 9 % increase in conversion and six basis points more in gross margin. And the most I've seen from NFM lending was

10 % increase in conversion and like 64 basis points more profitable. I just, can't emphasize enough for both loan officers, managers, how that optimal blue price is delivered. It's a point of sale. It matters. And it all really just comes down to training and leadership. So I'm always pushing, ⁓ anybody listening to this, you're a head of production, you're on that.

The MVP is your producing managers, know, producing branch managers is where the change takes place. So I'm always like pushing, like if you could get your producing branch managers to lead by example and, then get your producing branch managers to start delivering beautiful, accurate, compliant, optimal blue pricing, but deliver that where it's highly localized, highly personalized, and it's helping the family make a better lifetime decision. Guys.

Profitability is waiting for you. You could be having higher conversion rates and you could be having higher gross margins. The data is the data.

I'm going to answer that question specific to generative AI because there are many ways you can do that if you're, especially if you're a lender using Optimal Blue and of course I'm biased, you know, being with Optimal Blue, but specific to generative AI, I think you have to know where you are in that hype cycle, right? And if you are at the very beginning, you'd have to know that you're going to invest some time and money

in training and building the center of excellence. And as I mentioned in the presentation, the good news for those that have not started with generative AI is they can basically skip, go from number one to number four, meaning skip the peak of inflated expectations and skip the disillusionment and the disappointment and go to the slope of enlightenment. So you can skip those by learning from the rest of us and of course all the blogs and posts that you see on LinkedIn and other media.

But that's what I would think that if you are beginning with that, you can learn from others. But if you're doing a proof of concept, you can certainly make it a very low resource one, you know, with one or two people and, really stay up to speed with what's coming out. There are a lot of tools. Unfortunately, there's so many, right? That you have to filter out what is good and what's bad. So that's where kind of the center of excellence becomes important because you have to have a team.

that is dedicated, could be one person, right, that is dedicated to identifying what is a good tool or what's a good LLM for my use case and for my company. So I answer that specifically generative AI, that's how I think you can maximize your profitability on using it. And of course, like I said earlier, I mean, we, our business as technology providers is to invest in technology, is to invest in generative AI. Our center of excellence is going to be much bigger than the center of excellence.

of a lender whose business is really to generate and make loans, but rely on Optimal Blue to be that technology provider and stay up ahead of innovation and generative AI. So you can always look to Optimal Blue for using ⁓ generative AI and advanced technology to maximize your profitability.

So I'm going to break the rule. said one thing, but I think there are two things or two half things ⁓ that have been important. know, one has absolutely been technology and process related. So as you know, we came off of two really lean years for Originations and lots of lenders were forced to really streamline how they ran their business, streamline their processes and their operations.

Some of it was to use technology. Some of it was to use technology better. Some of it was to just really stick to what you have to do to get that loan done or to get the new business. So that leaning out was one big thing. And again, using technology tools were necessary. But I think the second part of that is we're hearing anecdotes that it still is a huge financial decision for lots of people, whether it's a refi or a purchase.

So you can have all the fancy tools and customer facing interfaces that you want, but at the same time, you still have to have that connection with the bar or you have to figure out what they need and how to get them there. I think it's still sort of remembering that even with technology and self-service and all the efficiencies, there is still a need to have that connection with your bar or with your client. that's kind of where I think things are going.

based on all the conversations that we're having right now.

think it's what we've touched about right now is that you've got this window where rates have not really come down significantly. We're starting obviously in June now. We're in kind of the normal high peak of the season, but it doesn't feel like a high peak compared to what's happened in the past. So now is the time if you're a lender to really look at ways that you can use technology to make your people more effective and more efficient, expand their capacity.

So as that volume returns, you're in a position where your folks are able to take on more without sacrificing quality or the work-life balance. So that way you can grow your business and scale your business without having to do it through people. And that falls directly to your bottom line as a lender. So that would be the number one thing I would stress right now.