Varun Krishna: Yeah. No, thank you for the question, Derek, I’ll just start by saying the reason that we’re obsessed with AI is because it brings a number of transformative benefits to our business. And that’s really grounded in the Rocket Logic platform and what it represents for the next job here in the company. The first 1 is just efficiency. It allows us to serve more clients by simply just automating the mundane. And the second 1 is speed and velocity, just because our clients’ value speed and certainty, they have to be competitive. They have to be able to operate and execute offers and things like that at speed. And then the third one is experience, just creating more personalization, more delight on what is a very emotional journey that millions of people go through when it comes to homeownership on every side of the equation.
And with Rocket Logic, we’re in the earliest days of this revolution, and I firmly believe the best is yet to come. And this is our AI platform. It is our most strategic imperative and we’ve dramatically increased our investment as well as the velocity with which we’re launching futures every week. The platform is now extended to every part of the journey from the digital experience that clients interact with to how we interact on the phone with mortgage banking or client services to the way we manage documents and extraction to income verification to underwriting to servicing. And we’ve started to see some pretty awesome benefits. We’ve seen hours saved. That’s a metric that we track. We were up to 170,000 hours per year. We’ve seen improvements in resolution times.
Our first call resolution has improved by 10% with the Synopsis experience that we just announced a few days ago. And then ultimately, just turn times, right, 2.5 times faster than industry. And then last, but not least, accuracy, we’ve seen zero audit findings with our income verification experience. And so across the board, this platform is delivering a benefit to us, both in terms of the client experience that our end clients face, but also just supercharging our team members to be able to do more with less. And so we’re very excited about this platform. We think it has tremendous benefits across the board, and we’re just getting started.
Derek Sommers: Great. Thank you. And then just to pivot to the servicing portfolio acquisitions. Can you guys share — shed any more light on those transactions? Were they coming from banks or non-banks? And is there more supply this higher coupon product? — coming across your desk?
Brian Brown: Yeah. I think let me just — that’s a fair question. Thank you. Let me take 1 step back just to talk about how we think about the servicing asset. It’s clearly a strategic asset. We really like the returns. Even if you just look at the cash flows right now, you’re generally looking at double-digit returns. And then, of course, for us, where you add in our industry-leading recapture, and that’s what really starts getting exciting in the return game. And we’ve always known that if a client goes through our J.D. Power winning origination experience and then we service them that we will recapture very well. But what is awesome to see is we’re starting to prove to ourselves that we can also recapture well when we acquire a portfolio of servicing.
Over the past couple of years, we’ve been doing that. It takes some time to prove out that hypothesis because you need data and information. And obviously, since the — where rates have been, just the number of transactions might naturally be lower. But we’re starting to have more and more confidence that on the acquired portfolios, our recapture rate will be very healthy as well. So to answer your question, what that means is that gives us even more confidence to be actively bidding in the market. To your point, we still are seeing supply a bit challenged. There is a lot of demand and a little bit of supply out there. So there are competitive bids. But here’s the thing — and you kind of mentioned this in your question that is exciting for us.
The asset that we’re very interested in and bidding on is a different asset than some of the others in the space are. Some of the servicers that have come out with some pretty robust goals around growing their servicing portfolio are actually interested in the very low WAC stuff. For us, to your point, the higher WAC stuff is actually a bit more interesting to us. If you think about the closed-end second opportunity there, if you think about a potential cash-out opportunity there, so in the proof point being these four pools that we just bought, that strategy is really being deployed. So they’re higher WAC than the current portfolio, and we really like our chances in terms of recapture. So it will be something we — I think you can expect us to continue to focus on and be active in the space.
Operator: Your next question comes from the line of Brad Capuzzi of Piper Sandler. Your line is open.
Brad Capuzzi: Thanks for taking my question. So you highlighted in your investor presentation, obviously demonstrated your results today. Rocket’s track record of continuing to grow market share. Kind of wanted to just hone in on your ability to grow purchase market share over the long term. I know there’s been a lot of investment in tech and AI, along with the addition of other products. But with the mortgage market being inherently localized specifically for the purchase market? What are the steps you guys are taking to address this issue?
Varun Krishna: Yes, I think — thank you for the question, Brad. I think the first thing I would just say is purchases a strategic focus area for the company more than it’s ever been in the past. And that comes down to how we’ve organized, how we’ve structured our teams, how we’ve dedicated resources and how we’ve just invested the time to really understand the nature of what it takes to win. That includes dedicated teams. It includes understanding the funnel. It includes also understanding the nature of just how you help clients with every aspect of the journey from searching from a home to building relationships with the realtor and broker to going through the process of making an offer. We have just dedicated significantly more focused toward than ever before.
That’s kind of the first thing. I think the other thing I would just say is we’ve integrated our ecosystem assets like never before. The role of Rocket Money has never been more important. The role of our Home Search experience has never been more important. The role of our Servicing Portfolio and building engagement with our clients where we can collect data and we can help them with their next transaction has never been important. So this is — it’s a game of interest, but the interest are everywhere when you kind of think about all of them put together and they add up. And so when you put those interest together, you start to see that execution happen. And so there are bigger swings that we’re thinking about. When you think about the opportunity that AI actually affords us to take a giant leap forward, we’re also obviously looking at both organic and inorganic opportunities.
But we’re serious about purchase, and you can expect to see us continue to invest and dedicate our focus on it and so we win.
Brad Capuzzi: And then just the last question for me. I mean, obviously, Rocket’s one of the leaders in technology across the mortgage market. And with your continued adoption of AI, can you just discuss how your investments and capabilities differ from industry competitors? Is AI it’s been a hot topic issue on recent calls from peers thus far?
Varun Krishna: Yeah. I mean I think the thing I would just say is, there’s a certain activation energy that’s required to be successful in AI. You have to have a large number of clients that you can engage with. You have to have a lot of data that you can build models around. And then you have to have resources that you can invest to kind of train, build and sort of continue to sort of improve these experiences that they’re better. So this is one of those where it’s difficult to be successful in AI if you don’t have data at scale, if you don’t have large engineering resources, if you don’t invest in data science, algorithmic intelligence, talent. And so I think for us, it is the strategic imperative at every layer of the company.
It’s where we’ve dedicated the vast number of our resources, and we’re continuing to grow our investment both with internal and external talent. And so for us, I mean, a good example I would give is just adding Alex Rampell to our Board, who is the industry leader in both FinTech and AI. That’s an example of just where the level of investment that we’re making, the thought leadership and just the focus is only going to be increasing. I’d also just share that we’re hiring a new Chief Technology Officer that will be joining the company in days to come. And so we’re serious about this. We’re investing, and we’re playing to win.
Operator: Thank you. That concludes the Q&A session. I will now turn the conference back over to Varun Krishna for closing remarks.
Varun Krishna: Well, thank you, everyone, for our great conversation today. We look forward to the next earnings call. We also invite you to our Investor Day later in the fall. We appreciate it.
Operator: This concludes today’s conference call. You may now disconnect.
