When applying for a new credit account many consumers find themselves inundated with frustrating and confusing offers from other creditors. Learn about the issue of “trigger leads” and what you can do to avoid them.
What are trigger leads?
A credit “trigger” is the term used when your mortgage lender runs a credit report during the processing of your loan application. The credit report is generated by the three major credit bureaus, Equifax, Experian, and TransUnion. It is then provided to the company that requested it, the mortgage lender you applied with, and that you authorized to inquire into your credit history. Unfortunately, it doesn’t stop there.
The credit bureaus then sell your name and information to other mortgage lenders as a “trigger lead.” Now that these additional lenders know you are in the market for a new home loan they will reach out to you to try to sell you on their mortgage product. They will often use intrusive and unscrupulous sales tactics, such as frequent repeated calls on any number they can get their hands on, or misrepresenting their rates, fees, or loan terms to make their program appear more attractive than they are. At times they will even try to confuse the consumer, falsely presenting themselves as representatives of the credit bureau or the mortgage lender the customer originally applied with.
“Few reputable mortgage lenders use this process to earn business because it is bothersome to consumers and just bad business,” said Brett Mosello, VP of Luxury Mortgage.
How can this harm consumers?
In some cases trigger leads are merely a nuisance. Frequent phone calls and mailings can leave mortgage applicants feeling harassed and frustrated. In others, the consequences can be more severe. If a home buyer or homeowner is duped into inadvertently beginning another loan application, perhaps because they believed they were providing information to the company they were already working with, it could cause confusion and delays.
Should the consumer be enticed by an inaccurate description of an alternate loan program they may end up paying much more than they anticipated or find themselves with a mortgage that does not meet their needs.
Protect yourself from trigger leads
Thankfully there are steps that you can take to stop your information from being sold to the highest bidder.
Register with the National Do Not Call Registry. Put your name, home phone number, and cell phone number on the list. Note that it takes 31 days to go into effect, and will expire after five years, at which point you will need to re-register.
Reduce mailings from lenders (and other junk mail) by registering at DMAchoice.org. This site from the Data & Marketing Association lets you choose what types of mailings you will and will not receive.
Opt out of future credit offers. Sign up at optoutprescreen.com and under the Fair Credit and Reporting Act (FCRA), credit bureaus will no longer be able to sell your information to other companies for the purpose of offering you credit or insurance products.
Ask to be “taken off the list”. If you do receive persistent sales calls insist that you be removed from their system and not receive future follow up inquiries.
At Luxury Mortgage the safety and security of our customers is among our top priorities. If you have any questions about protecting yourself from trigger leads or any other aspect of the home financing process don’t hesitate to give us a call or contact us today by clicking here.
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