Better.com CEO says AI is the only path to saving affordable starter homes by automating low-margin mortgages lenders avoid

Better.com's CEO Vishal Garg publicly stated that artificial intelligence is necessary to make the starter home market viable again. The problem: traditional loan officers skip low-value mortgages because the profit margin is too thin to justify manual labor, leaving first-time homebuyers unable to refinance or get loans.

AI agents (software that makes decisions and takes actions automatically) can handle mortgage processing end-to-end—document review, underwriting, compliance checks—without human intervention, dramatically cutting the cost per loan. This makes processing $200,000 mortgages economically viable for lenders, whereas today they reject these applications as money-losers.

For first-time homebuyers and families looking at starter homes under $300,000, this means loans that currently get rejected or forced into higher rates could become accessible again. For mortgage platforms like Better.com, AI-powered underwriting becomes a competitive advantage—they can capture market share from traditional banks that refuse to touch low-margin deals.