ICE Mortgage Technology is moving fast to drag MSP off the mainframe. Intercontinental President Ben Jackson says AI-assisted coding has cut what was once a 7-year overhaul “to roughly half that.”

The tech giant 🦣, which has something of a hate-love relationship w/ mortgage, had a strong Q3. ICE Mortgage Technology signed 16 new Encompass clients overall, including 2 new MSP clients (5 of the 16 were already Encompass users) & saw adjusted operating income rise 42%. Even w/ its heavy debt from acquiring Black Knight, the segment turned a profit.

(🙏 If you like what you’re reading, tell a fellow mortgage junkie to sign up here.)

We’re also getting a better glimpse as to how ICE Mortgage Technology—backed by the $100B parent of the NYSE—is playing the AI game.

“It's enabled us to transition these platforms from what have historically been seen as systems of record to a system of intelligence,” Jackson on the earnings call. “We have the proprietary information on how to orchestrate that workflow & how to make it more robust.”

ICE is using agentic AI tools & machine learning to assist lender clients, particularly w/ self-service workflows & recapture opps. That’s the kind of stuff that moves the needle (unless it’s just buzzwords). Jackson even said that MSP customers are saving as much as 30% on the cost of servicing a loan & “we expect this number will increase w/ the new innovations that we have coming to market.”

As The Scoop has reported extensively, every single ICE competitor has to overcome huge structural obstacles 🧱 to meaningfully take market share from the industry giant, which controls an estimated 2/3 of the marketplace. More likely, smaller LOSs will consolidate & it’s hard to see a real competitor emerge on servicing.

But I do wonder if ICE’s leaders have been paying attention to the drama 🎭 & client revolt at Fiserv. The only analyst who slapped a sell rating on Fiserv ahead of the company's $30B brutal stock selloff was a 26-year-old in London who’s feeling pretty good today.

Rothschild & Co’s Dominic Ball had been talking to customers of Fiserv & knew about the troubles at Clover, the flagship POS system that frustrated clients w/ its mountain of superfluous fees, he told Bloomberg. According to Ball, Clover’s shortcomings stemmed from its distribution & limited market share growth. While the payments processing system did well among merchants doing between $200K to $250K in annual sales, Fiserv had captured most of its market by the end of last year, he told Bloomberg.

Fiserv has a relatively limited presence in mortgage & ICE Mortgage Technology’s business is far stickier & more diversified. But Fiserv’s story should be a reminder that even Goliaths are vulnerable if they don’t focus on their customers’ needs, give them good value & strategize to attract new business.

Hey, everybody! The Mortgage Scoop launched about 2 months ago & I’ve been blown away by the support. Thank you 🙏 so much. I wanted to share an important update about the business. We’ll be moving to a paywall starting Wednesday, Nov. 19.

Paid subscribers will get exclusive MWF newsletters packed with scoops, analysis & insights you won’t find anywhere else (plus some bonus content). Founding Members can lock in the price of $240 per year. Monday editions will remain free & open for all subscribers. Hit me up w/ any questions you might have. - James Kleimann

While the rest of the mortgage industry was flat in Q3, Zillow again posted strong purchase numbers. The company generated $53M in revenue from mortgages in Q3 on $1.27B in origination volume. (Interestingly, the company only did $5M in refis in Q3). 

Zillow recently sunset its rate table, has been pressuring agents to increasingly refer clients to Zillow Home Loans, & in turn is undercutting competitors w/ sharp mortgage discounts, sources said.

”Zillow’s permanent buydown cost to a 5.5% rate for a buyer [on] one of my listings was $8K lower than another lender’s cost,” top Denver agent Lauryn Dempsey wrote on LinkedIn. “Obviously that’s a big savings, but Zillow also messed up at the end of the deal & the closing day was a disaster.” 

Company executives on the Q3 earnings call said their Enhanced Markets (basically the whole Zillow funnel) are performing well & they’re seeing a double-digit adoption of Zillow Home Loans. That victory probably does come at some expense of its more traditional lead business. Agents & LOs told The Scoop in September that buy-side lead quality from Zillow hasn't been what it used to be.

Zillow is projecting a 20% increase in mortgage revenue y-o-y in Q4 ‘25. That should give Zillow around $50M in mortgage revenue…

The Scoop published a story last week detailing shady tactics some lenders are using to juice business. Here’s some other tactics readers are unhappy about.

Does the FHFA’s “cap” on Rocket’s GSE servicing include sub-servicing? Maaaaybe?! CFO Brian Brown said on last week’s earnings call that the terms w/ FHFA are “confidential” but he said Rocket has plenty of runway. Given that analysts estimate Rocket to be at or above the 20% cap w/ subservicing, my interpretation is subservicing is not included.

(🙏 If you like what you’re reading, tell a fellow mortgage junkie to sign up here.)