In the Market for a Mortgage? Beware of Trigger Leads, Which Could Expose You to Identity Theft

The term “mortgage trigger lead” might be something you’ve never heard about but it’s something we think you should most certainly know about.

When you fill out a home mortgage application, the lender will pull your credit from the national credit bureaus. The credit bureaus then turn around and sell that information, called a trigger lead, to competing lenders who then solicit you, trying to get your business before you lock in a rate with the original lender you applied.

These leads, which include your name, contact information and a significant amount of personal information, are sold within a day of your loan application.

According to this Chicago Tribune story, “Out of the blue, your phone might ring and suddenly you’re the target of a new pitch from a competitor offering a deal that may be real, deceptive or no better than the one you’ve already been quoted.”

The National Association of Mortgage Brokers (NAMB) wants to ban them and is campaigning on Capitol Hill in favor of one.  The Association represents the interests of individual mortgage loan originators and small to mid-size mortgage businesses.

“Trigger leads impose danger to consumers in several ways,” said John G. Stevens, NAMB president, in a recent press release. “First, they expose borrowers to identity theft and increase the risk of compromising borrowers’ financial passwords. They also increase the borrower’s exposure to potentially unfair and deceptive activity by unscrupulous mortgage originators looking to impinge on another mortgage professional’s client.”

Trigger leads then lead to trigger calls, where a telemarketer calls and tries to trick a consumer into applying for a loan with another company. Meridian Home Mortgage Corp, a lender in Maryland, posted a recording of a trigger lead call voicemail online recently that showcases the deceptive language used in these calls. In the voicemail, the telemarketer claims to be an underwriter from Fannie Mae and implies that the customer already applied for a loan, which was not the case.

This is a prime example of a lender abusing the trigger data that they purchased from a credit bureau,” Meridian writes on its blog post that includes the recording of the call.

NAMB believes trigger leads to be an “unfair and deceptive trade practice” that should be banned in order to protect the consumer. They want to amend the Protect Act, a credit bureau bill sponsored in the House by North Carolina Rep. Patrick T. McHenry and Georgia Senator David Perdue. Unsurprisingly, the credit industry is against their effort.

So what can you do in the meantime? You should definitely add your name to the National Do Not Call Registry, which is run by the FTC. And if you apply for a mortgage loan, screen your calls even more vehemently than usual.

Additionally, there’s no better time to get covered for identity theft. LibertyID is the AAA of identity theft protection, offering the most effective identity theft restoration service. Members rest easy knowing that if their identity is stolen, we will fix it. There’s no limit to the time or money we will spend restoring your identity to pre-event status. A certified restoration specialist will handle all of the legwork and keep you informed with regular status updates. But just like with AAA, you have to be covered before there’s an incident.