Good News for Homebuyers Shopping for a Mortgage

Have you ever applied for a mortgage only to find yourself inundated with phone, text, and email offers? My clients have told me that after I pulled their credit report, they would get up to 80 annoying phone calls from other mortgage companies. These are trigger leads. A trigger lead occurs when a lender pulls a borrower’s credit report during a mortgage application. Credit bureaus then sell that information to other lenders who contact the borrower with competing loan offers. This practice results in a surge of unsolicited calls, texts, and emails shortly after an application is submitted.

After years of lobbying by my professional association and others, a federal law restricting trigger leads went into effect on March 5. This law limits when credit bureaus can sell data generated by mortgage pulls. Consumer reporting agencies generally can not sell trigger leads unless the borrower has given explicit consent or the institution already has a qualifying relationship with the consumer, such as an existing mortgage or bank account.

This is a big win for consumers. The new legislation will protect them from misleading, unwanted, and annoying credit solicitations. Homebuyers will regain greater control of their personal financial information.