UBank launches Mia, the digital human home loan assistant

UBank launches Mia, the digital human home loan assistant

Would you get a home loan from a robot mortgage broker? You may soon get your chance to find out, thanks to the new ‘digital human’ home loan assistant that’s been introduced by UBank and FaceMe.

The assistant, named Mia (‘My Interactive Agent’), is to provide similar Artificial Intelligence (AI) functionality to online chatbots and virtual assistants in the style of Siri and Alexa, while adding a digital face to the online home loan application experience.

UBank Mia 1

UBank customers will be able to speak directly to Mia on their computer or smartphone and get answers to more than 300 of the most common home loan application questions, such as “what’s a variable rate?” or “what classifies as an expense?”.

Mia’s persona has been developed to provide customer-friendly service – she doesn’t use bank jargon, but does use gifs and animations as part of her “cheeky” personality.  

Mia is set to complement UBank’s AI-enabled home loan chatbot, RoboChat, as well as Live Chat with UBank’s advisors. According to UBank, RoboChat has answered more than 50,000 questions since its 2017 launch, at a rate roughly 86 questions per day. 

UBank CEO, Lee Hatton, said that Mia gives customers a whole new way to interact with their home loan application, and challenges the perception of a digital bank.  

“We want to continue attracting customers but maintaining the same number of team members to support this ever-growing customer base. That means we need to leverage key technologies like AI to tackle the typical questions customers ask, so we can free up our team to address the unique situations our customers need more support with, every day.”

FaceMe CEO, Danny Tomsett, said that the vision for this project was to create more meaningful and valuable experiences for UBank customers, adding that “Mia offers an emotionally connected experience for servicing customers making an exciting and important life decision.”

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What do mortgage brokers do?

Mortgage brokers are finance professionals who help borrowers organise home loans with lenders. As such, they act as middlemen between borrowers and lenders.

While bank staff recommend home loan products only from their own employer, brokers are independent, so they can recommend products from a range of institutions.

Brokers need to be accredited with a particular lender to be able to work with that lender. A typical broker will be accredited with anywhere from 10 to 30 lenders – the big four banks, as well as a range of smaller banks, credit unions and non-bank lenders.

As a general rule, brokers don’t charge consumers for their services; instead, they receive commissions from lenders whenever they place a borrower with that institution.

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The ratings are between 0 and 5, shown to one decimal point, with 5.0 as the best. The ratings should be used as an easy guide rather than the only thing you consider. For example, a product with a rating of 4.7 may or may not be better suited to your needs than one with a rating of 4.5, but both are probably much better than one with a rating of 1.2.

How does a redraw facility work?

A redraw facility attached to your loan allows you to borrow back any additional repayments that you have already paid on your loan. This can be a beneficial feature because, by paying down the principal with additional repayments, you will be charged less interest. However you will still be able to access the extra money when needed.

What is bridging finance?

A loan of shorter duration taken to buy a new property before a borrower sells an existing property, usually taken to cover the financial gap that occurs while buying a new property without first selling an older one.

Usually, these loans have higher interest rates and a shorter repayment duration.

What is the flexibility score?

Today’s home loans often try to lure borrowers with a range of flexible features, including offset accounts, redraw facilities, repayment frequency options, repayment holidays, split loan options and portability. Real Time Ratings™ weights each of these features based on popularity and gives loans a ‘flexibility score’ based on how much they cater to borrowers’ needs over time. The aim is to give a higher score to loans which give borrowers more features and options.

What is breach of contract?

A failure to follow all or part of a contract or breaking the conditions of a contract without any legal excuse. A breach of contract can be material, minor, actual or anticipatory, depending on the severity of the breaches and their material impact.

What factors does Real Time Ratings consider?

Real Time RatingsTM uses a range of information to provide personalised results:

  • Your loan amount
  • Your borrowing status (whether you are an owner-occupier or an investor)
  • Your loan-to-value ratio (LVR)
  • Your personal preferences (such as whether you want an offset account or to be able to make extra repayments)
  • Product information (such as a loan’s interest rate, fees and LVR requirements)
  • Market changes (such as when new loans come on to the market)

What is a fixed home loan?

A fixed rate home loan is a loan where the interest rate is set for a certain amount of time, usually between one and 15 years. The advantage of a fixed rate is that you know exactly how much your repayments will be for the duration of the fixed term. There are some disadvantages to fixing that you need to be aware of. Some products won’t let you make extra repayments, or offer tools such as an offset account to help you reduce your interest, while others will charge a significant break fee if you decide to terminate the loan before the fixed period finishes.

Who offers 40 year mortgages?

Home loans spanning 40 years are offered by select lenders, though the loan period is much longer than a standard 30-year home loan. You're more likely to find a maximum of 35 years, such as is the case with Teacher’s Mutual Bank

Currently, 40 year home loan lenders in Australia include AlphaBeta Money, BCU, G&C Mutual Bank, Pepper, and Sydney Mutual Bank.

Even though these lengthier loans 35 to 40 year loans do exist on the market, they are not overwhelmingly popular, as the extra interest you pay compared to a 30-year loan can be over $100,000 or more.

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For example, the monthly repayments on a $250,000 loan with a 5 per cent interest rate over 30 years will be $1342. For a loan of $300,000 on the same rate and loan term, the monthly repayments will be $1610 and for a $500,000 loan, the monthly repayments will be $2684.

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