Banking on Information · 2025-10-06 · 13 min
Key moments - from our scoring
Substance score
50 / 100
Five dimensions, 20 points each
Derek Long brings 33 years of mortgage industry experience to his role at LoanPASS, where he's building a decisioning engine designed to handle the complexity that traditional pricing engines cannot manage. The platform serves lenders like Revolution Mortgage (who needed flexibility for construction and non-QM products) and SmartFi Home Lending (enabling side-by-side reverse and forward mortgage comparisons for loan officers). LoanPASS recently powered FICO's demonstration of their new 10T credit score at the Namba conference - the first pricing engine to ingest and compare this novel scoring methodology against traditional scores. What distinguishes LoanPASS is its configurability: business administrators can implement pricing changes in minutes rather than months, and clients can modify underwriting guidelines without vendor involvement. Long's vision for 2035 extends beyond mortgages to a universal AUS (automated underwriting system) that handles any lending product - auto loans, business loans, custom guidelines - all ingested through a single flexible engine. He emphasizes that AI should enhance human decision-making rather than replace it, cautioning that 90% of mortgage AI solutions have failed and that true innovation means lowering loan costs and resource requirements, not merely adding complexity.
LoanPASS is a flexible decisioning and pricing engine designed to handle loan products and pricing structures that traditional engines cannot support, including construction lending, non-QM products, reverse mortgages, and custom guidelines. It allows business administrators to implement changes without engineering involvement.
No, according to Derek Long, AI cannot safely make final lending decisions for financial products due to hallucination and accuracy risks. Instead, AI should be used to gather data, analyze information, and support human decision-makers or smart decisioning systems that make the final approval call.
LoanPASS enables business administrators to implement pricing changes in approximately five minutes, whereas one client's previous system required two months to make similar pricing adjustments.
The platform is architected to become a universal AUS capable of underwriting any lending product - including auto loans, business loans, and custom products - using flexible guidelines ingested through a single engine, rather than remaining mortgage-specific.
LoanPASS was the first pricing engine able to ingest and display FICO's new 10T credit score, allowing side-by-side comparison with traditional scores. FICO demonstrated this capability at the Namba conference.
Our reviewer’s read on each dimension, with quotes from the episode.
The episode contains some useful operational specifics (e.g., pricing changes taking 2 months vs. 5 minutes in LoanPASS, FICO's 10-T score integration) and real customer examples, but much of the substance is product-focused marketing rather than generalizable insights for B2B operators. The AI discussion late in the episode offers one genuinely useful contrarian point - that AI should enhance, not make final decisions - but it's underdeveloped and brief.
In LoanPASS you know, a business admin can do it in five minutes
you cannot, for any financial decision, if you just say, AI, tell me if I can approve this loan or not, you are going to be in trouble
The guest reiterates familiar startup positioning (flexibility, customization, solving legacy constraints) and standard Silicon Valley talking points about AI enhancement vs. replacement. The specific examples are concrete but the underlying thesis - that rigid legacy systems block innovation and better UX wins - is well-trodden in fintech discourse. One moderately fresh observation on AI's role in lending, but largely recycled frameworks.
I don't like following the crowd. I like finding something different
you cannot, for any financial decision, if you just say, AI, tell me if I can approve this loan or not, you are going to be in trouble
Derek Long is a COO and founder with 33+ years in mortgage lending, giving him relevant domain depth and operational credibility. However, he is founder of a B2B SaaS vendor selling into his own market, which introduces an inherent incentive to promote his product rather than offer unfiltered perspective. His background is strong but his role limits the independence and breadth expected of top-tier guest caliber.
33 years in mortgage industry
had a opportunity to found my own company before doing something nobody had ever done before
The episode provides several named clients (Revolution Mortgage with 100+ retail branches, SmartFi Home Lending, FICO) and concrete operational examples (5-minute vs. 2-month config change, reverse mortgage side-by-side comparison). However, financial metrics, deal sizes, adoption timelines, and quantified impact are absent. Most evidence is anecdotal customer testimonials rather than hard data.
revolution mortgage, large retail, mortgage bank with over a hundred more, retail branches
with their current pricing engine, it took them two months to get that change. So it was a little late. In LoanPASS you know, a business admin can do it in five minutes
The host, Rutger Van Faassen, asks open-ended questions and occasionally mirrors back the guest's points, but rarely pushes back, probes depth, or challenge claims. Questions are generally soft and affirming (e.g., "how do your customers talk about you?") rather than adversarial or probing. The 'Futures Thinking' prompt is broad and the host allows Long to pivot directly into product vision without interrogating assumptions.
So you are an innovator at heart
Now that is very powerful
Computed from the transcript - who did the talking, and the words that came up most.
Derek Long, COO of LoanPASS, discusses revolutionizing mortgage technology with flexible decisioning engines that handle everything from reverse mortgages to construction loans. He shares his 33-year innovation journey, unique use cases like FICO's 10T score integration, and his vision for AI-enhanced lending across all financial products. 7 Key Takeaways LoanPASS enables lenders to configure custom lending products without engineering involvement, reducing implementation time from months to minutes for pricing changes. The platform supports non-traditional mortgage products including reverse mortgages, construction loans, and non-QM lending with side-by-side comparison capabilities. LoanPASS became the first pricing engine capable of ingesting FICO's new 10T score and demonstrating it alongside classic scores at industry conferences. Derek Long emphasizes that AI should enhance data gathering and analysis but cannot make final lending decisions, requiring smart decisioning systems to maintain compliance. The vision for LoanPASS extends beyond mortgages to become a universal automated underwriting system for all lending products including auto, business, and personal loans.
Transcribed and scored by The B2B Podcast Index.
Rutger Van Faassen (00:01.524) Hello and welcome to another episode of Banking on Information. Today, my guest is Derek Long, who is a COO at LoanPASS. Welcome to the podcast, Derek.
Derek Long (00:12.878) Thank you, Rutger. Rutger Van Faassen (00:14.994) Now we always start with that same question for everyone.
So here it is for you. Why Derek, do you do what you do? Derek Long (00:20.237) Yes.
For me it is coming up with something different and unique. The last thing I want to do is just the same old same old. So, you know 30 years plus 33 years in mortgage industry and I've always wanted to try and explore new opportunities and new ways of doing things. Rutger Van Faassen (00:40.
18) So you are an innovator at heart. Derek Long (00:43.712) I am. I don't like following the crowd.
I like finding something different. So yeah, I've explored that in different ways, had an opportunity to found my own company before doing something nobody had ever done before. So it was a lot of fun and we're getting that chance again with LoanPASS. Rutger Van Faassen (00:47.
572) Alright. Yeah. Rutger Van Faassen (01:02.996) So you like to do things differently and make things better, I hope.
Yeah. Right. Derek Long (01:07.756) Yes, that is certainly the goal.
To do things differently that makes it worse serves no purpose. Rutger Van Faassen (01:12.872) Yeah, no, so it's interesting to see that you picked the mortgage industry as a place to innovate in because it's quite a conservative industry. that is You really need to have a strong why to be able to survive in the mortgage industry and make things better.
Derek Long (01:21.504) It is. Derek Long (01:29.934) Absolutely, it has been a struggle for those 30 plus year career.
Sometimes getting over those hurdles, but I enjoy the challenge. Rutger Van Faassen (01:39.272) Yeah. Now, what is the number one use case that you solve for at LoanPASS?
Derek Long (01:45.908) I could talk about this for hours, but I will try to limit it to a few examples. I mean, one, one great example is a client of ours called revolution mortgage, large retail, mortgage bank with over a hundred more, retail branches. They were looking to expand their offering to more than just, agency and government lending.
And they wanted to create their own construction lending division. and also wanted to create their own custom portfolio non QM lending product. And their current decisioning and pricing engine did not allow for that. Didn't have the flexibility to do that.
So they were looking for another solution. They found LoanPASS and for the last year and a half, they've been using us and allows them to do things they simply couldn't do before. We've got another client, SmartFi Home Lending, who is a reverse mortgage lender. that is trying to make reverse lending more accessible to traditional loan officers.
And I don't know if you've ever know anything about reverse mortgage lending, but even after 30 years in the mortgage industry, the first time I saw a reverse rate sheet, I had no clue what it meant. I I didn't understand any of it. It's just, it's just foreign. So LoanPASS became the first decisioning engine able to do reverse mortgages and even do it side by side.
Rutger Van Faassen (03:00.914) Right. Yep. Yep.
Derek Long (03:11.807) a reverse looking at a forward and giving loan officers the ability to compare both, which is something that can really help those of a certain age that are looking for options of what to do. So those are a couple of examples of how we solve problems with the flexibility of LoanPASS, of what it can do that makes it unique. Another interesting example just occurred this past week, FICO rather large company called FICO.
Rutger Van Faassen (03:41.15) Right. Derek Long (03:41.409) has been trying to introduce a new type of score called the 10 T.
Their problem has been running into technology that can take in this stuff and adapt it. And so we created a simple version of LoanPASS that they could use. And at the Namba conference last week, they had a booth and they were using LoanPASS to show this in action. Cause we are the first pricing engine that can ingest this new 10 T score, show it against the classic score and show the differences.
So, Rutger Van Faassen (03:46.164) Mm-hmm. Derek Long (04:11.288) just unique use cases where people just can't do things without something like LoanPASS.
Rutger Van Faassen (04:15.464) Right. So you help those people who want to do anything that's kind of out of the ordinary. it's Anything that's not plain vanilla, you help do that and compare it to plain vanilla and sort of say, hey, this is just a regular 30 year fixed conforming mortgage, but you can compare this to this reverse mortgage.
How would that look? Derek Long (04:26.446) Correct. Yeah.
Derek Long (04:35.778) Yeah, and right. And we can do that because of the flexibility of LoanPASS to be so configurable and do it without having to get engineering involved. you know, Another interesting example was a client came to us and said they wanted to have a pricing special for their banking clients for the last two weeks of a month.
You know, just, you know, If you do a loan with us now, there's a special. Rutger Van Faassen (05:01.448) Yep, right. Derek Long (05:02.
126) with their current pricing engine, it took them two months to get that change. So it was a little late. In LoanPASS you know, a business admin can do it in five minutes. And so it gives them control, it gives them speed, flexibility, that kind of stuff.
Rutger Van Faassen (05:07.284) All right. Yep. Rutger Van Faassen (05:18.
748) Yeah, now that is very powerful. Now, when that all goes well, how do your customers talk about you? What do they say about the outcome that you're delivering for them? Derek Long (05:23.
586) Mm-hmm. Derek Long (05:28.52) one of the very first clients we brought into implementation unasked for came to me afterwards. I said, how did everything go?
And she said, you guys are the best tech company we've ever worked with. And so I now at every kickoff call with every new client, I tell them that story and I tell them I'm setting the bar really high. That's what I'm telling you right now. I expect you to be able to say the same thing.
And if you can't let us know. We get, We get a lot of really nice compliments. Rutger Van Faassen (05:45.715) Yeah.
Rutger Van Faassen (05:49.267) Right. Rutger Van Faassen (05:58.462) Yeah.
Derek Long (05:58.679) not Not only because of the software, but because of our team and how we treat our clients. Rutger Van Faassen (06:02.61) Right.
And obviously it keeps you sharp, keeps you on the ball because with that statement you have to deliver. right? Derek Long (06:08.462) It does.
My team doesn't like it so when I do it, but I think it's a high standard and I want try to do that. We're trying to bring the value to our clients and we do. Rutger Van Faassen (06:14.164) You're right.
Rutger Van Faassen (06:23.22) Yeah. Now that is, that is very powerful. That's a very powerful customer story and how they sort of see you as the best tech company they've worked with.
That is amazing. Now I like to do this thing called Futures Thinking. Now we don't know what the future is going to bring. We don't even know what's going to happen tomorrow.
But what I'd like to do here is just think 10 years out. So 2035. What do you think the... Derek Long (06:36.
855) Okay. Rutger Van Faassen (06:46.824) mortgage market looks like, how will technology play a role in that? What are your thoughts?
What's your vision for 10 years from now? Derek Long (06:54.552) Well, for LoanPASS, I have a very specific vision. And it has to do with part of how LoanPASS was architected and part of our long-term goal.
Because we don't want to be just a PPE or a pricing engine. We were designed to be a full AUS, automated underwriting system, okay, that also does pricing, which is kind of unique. Rutger Van Faassen (06:59.209) Mm-hmm.
Rutger Van Faassen (07:17.778) Yep. Derek Long (07:20.846) And also we were designed with the goal in mind of not being just a mortgage engine, but being able to do any lending product.
imagine 10 years down the road, you're a bank or a credit union or any kind of lending depositor that has their own unique lending guidelines and is looking for a decisioning engine that is flexible, that will take all of their custom stuff. You upload a credit report, you upload an appraisal, all of that data is taken in and a DU or LP like finding is created, but it's for your custom product, your guidelines, and it can be used for every lending product that your bank or credit union offers.
Your auto loans, your business loans, your, so you've got one tool custom to you doing a full AUS. pulling in the credit, that kind of stuff. That's kind of the vision that we have for LoanPASS. Rutger Van Faassen (08:22.
388) Wow. So an automated underwriting system that basically allows you to underwrite any type of loan, not just mortgages, not just alternative mortgages, but any type of loan that has underwriting criteria that you can feed it. Derek Long (08:37.538) Yeah, we just need guidelines and rates and then we build it.
Part of the power for us is a lot of our clients like to do it themselves. Like one of our very first clients, I was on a meeting with them last week and they've been with us for four years now and I asked them, you know, how's it going? And they said, we just totally redid all of our guidelines, all of our adjustments. And we didn't know it because they never had to ask us a thing.
They just did it themselves. And so. Rutger Van Faassen (08:46.11) Mm-hmm.
Rutger Van Faassen (09:02.344) Right, wow. Derek Long (09:04.622) That was a nice, powerful testimony to us as well.
Rutger Van Faassen (09:08.776) Yeah, yeah, that you didn't even know that they were making the changes because it was so easy to make them. That is very, very powerful. Now, what else do you see 10 years out?
What do you see the rest of the market? So you have a vision for where you want to be. What do you think is going to change over the next 10 years when it comes to mortgage lending, housing, anything futuristic? What do you think?
Derek Long (09:21.037) Right. Derek Long (09:28.866) Yeah, Obviously, AI is on everybody's mind.
And to me, the key is some people have wondered, can you use AI to make decisions? And we think it's very clear you cannot. You can use AI to gather data. You can use AI to analyze.
But you cannot, for any financial decision, if you just say, AI, tell me if I can. Rutger Van Faassen (09:34.484) Mm-hmm. Rutger Van Faassen (09:44.
926) Mm-hmm. Derek Long (09:57.569) approve this loan or not, you are going to be in trouble. And so what you need is a very smart decisioning system like LoanPASS that leverages AI as much as possible, that brings in the data, that helps verify the data, that does a lot of different things.
And I think that's the direction things will be going is certain pieces of the mortgage industry will be simplified and, you know, it'll just go instantaneously, but it has to be applied very carefully, which we're in this weird phase right now where we're trying to figure out what is that and what can it do, but the potential is massive. Rutger Van Faassen (10:29.704) right. Rutger Van Faassen (10:37.
48) Yeah, Yeah, no, That is a very interesting perspective that you have there to say the AI doesn't have to do the final decision making. It can do a lot of the things up until that point, but will still leave that to a human in the loop or a system that can do that, but not an artificial intelligence that actually makes that decision. That is probably gonna sound like music. Derek Long (10:56.
696) system that is. Derek Long (11:00.492) Right. Rutger Van Faassen (11:04.
82) to a lot of people's ears that are still a little bit worried about like hallucination and not sure if AI makes the right decision. So that's an interesting perspective. So if that's where we're going, what can we do today to get ready for that future 10 years from now? Derek Long (11:11.
18) Yeah, yeah. Derek Long (11:22.894) Um, Be careful about the AI tools you're looking at. Cause there's, mean, I think I heard just this morning, 90 % of mortgage AI solutions have failed.
So there's, there's a lot that people are thinking of and the creativity is awesome, but it's correct application of AI and it's not replacing people. It's enhancing what people can do, making them more efficient, that kind of stuff. We're not getting Rutger Van Faassen (11:35.177) Go.
Derek Long (11:52.801) rid of loan officers, we're figuring out how loan officer can do more loans and be more effective or the same thing with processors, underwriters, that kind of stuff. To me, that is the focus is train, build your team with that in mind and look for improvements and enhancements, not replacements. Rutger Van Faassen (12:14.
302) Yeah, that is certainly a good thing to think about. And actually interesting to hear that from you because you professed to be an innovator and want to change things, but you sort of say, not just changing for the sake of changing, we do want to make it better and safe. Derek Long (12:29.326) We do.
mean, One of my big frustrations in this industry over the years has been all the change that's supposed to have happened to make a mortgage loan cheaper. And anything has gotten more expensive. So all the technology has improved some areas, but it has not cut the costs as it needs to. And I think that's a huge, huge issue that we have to get to.
We have to find ways to be both efficient in cost and efficient in time and resources. So there are some creative things I'm seeing out there. I like the fact that LoanPASS has positioned ourselves to be the smart decision engine connected to lots of other technology. So it's not just lenders that we're working with, other vendor partners who are trying to find ways to leverage a very flexible, very adaptable, very smart engine that can make quick, instant decisions and move on from there.
Rutger Van Faassen (13:29.736) That is probably a great point to wrap this up on. Thank you very much, Derek, for being on the podcast. Derek Long (13:35.
436) You bet. Thank you for having me, Rutger. I enjoyed it. Rutger Van Faassen (13:36.
948) And yeah, no, likewise. And until next time, choose to be curious. Derek Long (13:43.427) Thank you.
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