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May 05, 2020

Spinning Data Exhaust Into Gold

Dina Guo loves to make "useless knowledge useful." For her, that means taking raw data and turning it into something of value. At Freddie Mac, she's found a way to turn the data we collect about our properties into a tool that makes one of our essential processes much faster and the results much more accurate.

A Path Less Traveled

Originally from Wuhan, China, Dina is the daughter of a university dean and an accountant. "My father traveled a lot internationally to education conferences," she said. "And my mother was one of the first people in her company to learn computers. She used one to design an automated payroll system."

Inspired by her parents' success and the impact they made in their careers, as well as a love for data, Dina set out to make a difference with hers.

"In my heart and mind," she says, "I want to leverage data to create a fairer world."

After graduating college in China, Dina began graduate studies at the University of Virginia.

"My field of study was 'computational econometrics,' which develops statistical methods to try to answer economic questions," she says. "Based on an analysis of data, I could develop tactics that would help solve social welfare issues."

Degree in hand, Dina started her first job in model validation at PNC. She then joined Freddie Mac in 2018.

"My first job was focused on commercial real estate. It gave me a quick grasp of the industry," she said. "But I missed Virginia. So, I sent my resume to Freddie Mac and someone in Multifamily found me. They were thinking about starting an AI-driven program, which matched my interests and background perfectly."

A Patent Pending

Today, she leads the team developing a ground-breaking, U.S. patent-pending algorithm that measures similarities between multifamily properties.

"Dina definitely enjoys a challenge," says her manager Jun Li, Multifamily quantitative analytics senior director. "She has the intelligence, skill and creativity to apply advanced analytics to our business in a way that moves us forward. She's a true innovator."

The algorithm is being used to create Comparable Engine (Comp Engine), a tool that leverages artificial intelligence, machine learning and other analytic methods to produce property similarity scores, which are used by underwriters in the appraisal process.

The current property comparison process involves an underwriter manually evaluating comparable properties provided by third-party appraisal reports, but these properties are usually not Freddie Mac properties.

"Comp Engine allows us to use Freddie Mac properties as comparables. By doing an internal evaluation of our own properties, we can see a better comparison because we have more information about a property's features and recent history of income flow and expense," said Dina.

With Comp Engine, underwriters can complete the process much quicker and with more helpful data.

"The algorithm we developed processes more traditional and nontraditional data, and it does it more efficiently and faster than any human ever could," said Dina. "It's an advanced tool that has the potential to substantially boost our productivity. We did a few tests with our business partner. Instead of three hours, the entire process of evaluating and selecting comparable properties took about 45 minutes."

Leading With Action

Now, small-balance loan (SBL) underwriters are testing the engine-recommended comparables for various regions. Soon, Comp Engine will be used by SBL underwriters in addition to conventional underwriters nationwide.

"This has been a golden opportunity for my team to combine our talents as a data science unit, as well as to effectively involve stakeholders from the business area in the algorithm development process," says Dina. "To design the algorithm, we needed to understand the what, where, why and how of our business partners, so that our method aligns with their thought processes."

Eventually, the goal is to make Comp Engine available to external users. "We would like everyone who does business with us to benefit from this tool," says Dina. "This is another example of how Freddie Mac is a leader in the housing industry. We're more than just a thought leader. We're an action leader."

Inspired to join Dina and the rest of the analytics team at Freddie Mac? We’re hiring for all open positions virtually. Check out our opportunities and apply today!


 

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