You’ve researched your mortgage loan options, talked to a real estate agent, and chosen your mortgage lender. Then you submit your loan application and suddenly find yourself inundated with unsolicited sales calls, texts, and other communications from different lenders. What’s going on? Who sold your data? How can you make it stop? In this article we’ll answer these questions by explaining what trigger leads are and what you can do about it.
What are mortgage trigger leads?
When you apply for a new home mortgage, your credit report is pulled for review. The credit bureau can sell your information to other mortgage lenders and insurers–this is known as a trigger lead. The credit inquiry “triggers” you as a potential lead for other mortgage companies.
The other mortgage lenders who purchase your information may then call, text, email, or send you snail mail in an attempt to win your business.
Theoretically, this gives the consumer a chance to compare different rates and loan terms as lenders compete for your business. However, these solicitations can be annoying, and some may dangle unrealistically low rates in an attempt to catch your attention. If you do engage with any unsolicited communications from mortgage lenders, make sure to review the terms and fine print carefully, asking questions along the way.
Are trigger leads legal?
The short answer is yes, trigger leads are legal. According to the Fair Credit Reporting Act, if a home mortgage loan inquiry is the basis for the report, consumer reporting organizations may produce a report for a credit transaction without the customer's cooperation or consent.
The Federal Trade Commission (FTC) and Consumer Finance Protection Bureau (CFPB) encourage lender competition, believing that these trigger leads can be good for the consumer (for the reasons mentioned above). However, U.S. Rep. John Rose (TN-06) has introduced the Protecting Consumers from Abusive Mortgage Leads Act, which would ban most trigger leads with a few exceptions.
The downside of trigger leads
Perhaps the biggest downside for consumers is the deluge of messages you can receive within 24 hours of applying for a new mortgage. It can feel overwhelming and irritating, like your privacy has been violated by having your data sold without your consent. Other downsides include:
- Disreputable companies can trick borrowers with fake, too-good-to-be-true offers.
- Scammers may try to steal your identity after getting you to fill out a fake mortgage application.
Ultimately, you know you can rely on your local mortgage lender along the lake shore in Michigan. We are here to provide personalized service and transparency throughout the mortgage application process.
How to resolve unwanted solicitations
Though they are legal, you can be proactive in avoiding trigger leads. Before you begin the mortgage origination process, you can:
- Visit OptOutPreScreen.com and sign up. This stops credit bureaus (Equifax, Experian, Innovis, and TransUnion) from selling your information for five years. To opt out permanently, you must complete and mail back a physical form. Be sure to opt-out at least out five days prior to a credit pull, for this to take effect.
- Register your number on the Do Not Call Registry. You can also do this by phone at 1-888-382-1222. It takes 31 days for your registration to take effect, so you should register at least one month in advance of applying for a new mortgage.
- Sign up at DMAchoice.com to keep loan offers out of your physical mailbox. There is a $2 charge for this service.
Last but not least, keep in mind that solicitors don’t have access to all your Personal Identifiable Information (PII) such as social security number. They only learn about a recent credit inquiry associated with a mortgage request from the credit bureaus, which enables them to compete for your business.
Apply for a mortgage loan in Michigan!
Are you looking for an experienced, local mortgage lender in West or Northern Michigan, along the lake shore? At West Shore Bank, our local mortgage lenders have a deep-rooted understanding of your community and the local real estate market. Meet our lenders, contact them with questions about trigger leads or anything else, and apply for a mortgage loan online!
