AI tools are becoming increasingly popular, and many people are now using them to answer financial questions, including questions about mortgages. That raises an interesting question: can ChatGPT replace a mortgage broker?
In this episode, James and Mike discuss exactly that. Using a real client example, they unpack the difference between having access to information and receiving personalised mortgage advice.
Mortgage Broker vs ChatGPT
One of the topics discussed in the episode is a question many homeowners ask: how long should you fix your mortgage rate for?
Mike shares a recent client conversation. The client wanted advice on the best fixed-term option for their mortgage. After reviewing their circumstances and considering the likelihood of further OCR increases at the time, Mike recommended fixing for two years.
The client had also asked ChatGPT the same question. ChatGPT’s recommendation was very different: fix for six months.
The point wasn’t whether one answer would ultimately prove right or wrong. Instead, Mike explains why he arrived at his recommendation. If rates continued to rise, a six-month fixed term could leave the client needing to refix at a significantly higher rate. A two-year term offered more certainty through a period where further increases were expected.
As James and Mike explain, mortgage advice is about far more than trying to predict interest rates. It’s about understanding someone’s circumstances, goals, and appetite for risk, then applying information in a way that makes sense for them.
The Difference Between Information and Advice
The distinction between information and advice is a key point discussed in the episode.
James and Mike discuss another example involving a financial adviser who reviewed a financial plan generated by ChatGPT. Before looking at the AI-generated recommendations, the adviser completed their own assessment and then compared the two approaches.
When they reviewed the AI-generated plan, they found several recommendations that didn’t fit the client’s situation or were based on incomplete information.
The issue isn’t that AI lacks access to information. In many cases, it has access to enormous amounts of it. The challenge is that it doesn’t truly understand the person asking the question. It can’t fully assess goals, behaviour, future plans, risk tolerance, or ask the follow-up questions that often reveal the details that matter most.
Does AI Just Tell You What You Want to Hear?
Another important point raised during the episode was how the way a question is framed can shape the answer that follows.
Mike suggests that AI can sometimes reinforce assumptions already built into a user’s question. If someone approaches the conversation hoping for a particular outcome, the response may unintentionally support that view.
The risk is that people end up seeking confirmation rather than objective guidance.
Professional advisers often serve a different purpose. Instead of validating assumptions, they challenge them. They ask questions, test ideas, and explore alternatives before making a recommendation.
Where AI Can Be Helpful
This episode isn’t anti-AI.
In fact, James and Mike highlight several ways AI can be genuinely useful.
Mike explains that many people face an information gap when making financial decisions. Most people don’t refinance mortgages regularly, and they may not be familiar with the terminology, processes, or options available to them.
AI can help close that gap by explaining concepts in plain English and helping people build a better understanding of the decisions they’re facing.
Used in that way, AI can be an excellent educational tool.
Where Human Advice Still Matters
At the same time, Mike and James argue that education and advice are not the same thing.
Advice requires judgement, experience, context, and an understanding of the individual involved.
James and Mike acknowledge that advisers aren’t infallible and can make mistakes. However, they also argue that AI currently struggles to account for all the variables involved in complex financial decisions.
Their view is that AI can be a valuable research tool, but important financial decisions still benefit from personalised advice from someone who understands the bigger picture.
Looking Ahead
James and Mike agree that AI is likely to become more capable and more integrated into everyday life and business. At the same time, they caution against assuming that today’s tools can do more than they actually can.
Their view is that AI is becoming increasingly powerful, but there remains a significant difference between providing information and delivering personalised advice tailored to an individual’s circumstances.
Key Takeaways
- AI tools can provide useful information but may not provide personalised advice.
- Mortgage decisions often require context that goes beyond simple data and calculations.
- Risk tolerance, goals, future plans, and personal circumstances all influence good advice.
- AI may reinforce assumptions already built into a user’s question.
- Information and advice are not the same thing.
- AI can help reduce information gaps and explain complex topics in plain English.
- Human advisers provide judgement, context, and challenge that AI may currently miss.
- Major financial decisions benefit from personalised advice rather than generic recommendations.
Next Steps
If you’re reviewing your mortgage structure or deciding how long to fix your rates, speak with the Lighthouse Mortgages team for personalised advice tailored to your situation.
If you’d like to watch more, check out these other episodes below.
For a no obligation discussion to see how we can help you on the path to wealth, please contact us.
Disclaimer:
The information in this article is general information only, is provided free of charge and does not constitute professional advice. We try to keep the information up to date. However, to the fullest extent permitted by law, we disclaim all warranties, express or implied, in relation to this article – including (without limitation) warranties as to accuracy, completeness and fitness for any particular purpose. Please seek independent advice before acting on any information in this article.
