Cutting tech bloat with AI: Blue Sage’s formula for sustainable growth

Blue Sage’s VP of Sales and Marketing Joey McDuffee discusses the company’s commitment to simplifying mortgage technology for lenders facing growing complexity and consolidation pressures. He highlights how the Blue Sage platform helps reduce cost to originate by cutting through tech bloat and enabling faster LOS transformations. 

In this interview with Allison LaForgia Joey also explores Blue Sage’s distinctive approach to AI, which focuses on delivering tangible benefits for both lenders and borrowers. He outlines key growth opportunities for lenders seeking scalable solutions in a competitive marketplace. 

“Not to date myself, but I’ve been in the business since 1993,” McDuffee said. “I really got to understand the nuts and bolts on how data was used and how you close a loan.” His career has spanned roles from training to sales, giving him a unique perspective on successfully “bridging the gap” between platforms and customer needs.

Founded in 2011, Blue Sage set out “to create the most modern, end-to-end, integrated lending platform to help drive efficiencies, reduce cost, and provide a great borrower experience.” McDuffee explained, “Our architects and designers created a platform that’s all API-first, so we can plug and play as technologies change.”

The platform consolidates POS and LOS functions into one system, eliminating “digital duct tape” from bolt-ons and bots that can be “very fragile” and costly. “As clients move over from a bifurcated process… there’s a lot of data loss. We wanted to get rid of all that,” McDuffee said. 

Automation also plays a key role. “We have clients that… have actually cut their approval process for portfolio products from three to seven days to 30 minutes,” McDuffee noted. Industry-wide cost to originate is $11,000–$13,000, but “about $1,000 to $2,500 can be removed… by automating manual tasks, consolidating platforms, and eliminating vendor overlap.”

Implementation, which has traditionally been a pain point for LOS transitions, is streamlined through a preconfigured “reference build,” functional workshops, and change management tools. “Within six weeks of signing, [clients] can start playing with the system,” McDuffee said. Using this approach Blue Sage had one lender up and running within six months.

On AI, McDuffee recommends deliberate adoption. Blue Sage has used AI for years for tasks ranging from analyzing HELOC portfolios to improving document classification and income analysis. A new AI sales agent gives loan officers “a ChatGPT-like interface” for in-process loans, scenarios, and product comparisons without navigating screens or menus. “As these models get better… we can replace them very easily,” he added.

McDufee sees a major opportunity for mid-size lenders. “What used to take months and years to implement… we can do in days or weeks,” he said. AI-driven efficiencies, like auto condition clearing, can give underwriters “three to five hours of efficiency” per day, enabling smaller players to “really compete against those larger lenders.”