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20 | TH E M R EP O RT FEATURE Big Data Changing the Mortgage Business The era of big data is here and has already started influencing the way lenders operate and servicers manage their mortgage portfolios. By Dennis Tally F rom online shopping to social media posts, the data trail consumers leave behind these days only grows longer and more telling. In fact, data scientists estimate that 90 percent of the world's data was generated over the last two years alone, according to a 2018 article published by Forbes. What does this mean for mortgage lenders? While the era of big data is still taking shape, no one can dispute that it's arrived. It's expected to transform the mortgage industry because of the insights it reveals about borrowers who are difficult to underwrite. This technology can accelerate the loan production cycle, improve risk management, render mort- gage servicing more efficient, and extend the reach of marketing campaigns among other benefits. Big Data, Big Deal? B ig data can mean many things, but technologists generally define it by the four Vs—massive in volume; extremely varied in format; high speed in velocity; and complex in terms of veracity. For mortgage lenders, it can include customer records (loan files, bank statements, brokerage accounts) and third-party information (credit scores, tax returns, credit card statements, or even cell-phone payment histories). Related terms, such as big data technology or big data analytics, refer to the way this information is captured, organized, and made searchable. Machine learning—a subset of artificial intelligence— uses algorithms to analyze big data, draw conclusions from it and update these conclusions as new data becomes available.