Major trade groups says bill will curb unsolicited mortgage solicitations
A coalition of housing and financial industry groups, led by the Mortgage Bankers Association (MBA), has formally voiced its support for federal legislation that would limit the use of mortgage trigger leads.
The letter, addressed to key House and Senate committee leaders, calls for the swift advancement of the Homebuyers Privacy Protection Act, reintroduced as H.R. 2808 in the House and S. 1467 in the Senate.
In a joint statement, the coalition urged lawmakers to move quickly.
“This important consumer protection legislation, if enacted, would curb the abusive use of mortgage credit ‘triggers leads’ in all but a limited set of circumstances,” the letter stated. “As you know, substantially similar legislation passed the Senate by Unanimous Consent last year.
“We urge you to support this carefully crafted proposal and to take appropriate steps to advance the two bills through your respective committees as soon as feasible.”
Trigger leads are generated when a mortgage lender pulls a credit report, signaling to credit reporting agencies (CRAs) that the borrower is shopping for a mortgage. Under current law, CRAs can sell that lead to other lenders and data brokers, who often contact the borrower directly, even if they have no prior relationship with that consumer.
“The consumer is then bombarded with hundreds of confusing calls that seek to lure them away from their chosen lender,” the coalition warned. These solicitations often result in consumer complaints directed at the lender that originated the credit pull, despite that lender having no role in the data resale.
Although the Fair Credit Reporting Act (FCRA) permits this resale as long as a “firm offer of credit” is made, the coalition noted that opt-out protections are limited, especially in the case of phone solicitations, which are not required to disclose opt-out rights.
Read more: Mortgage trigger lead reform bill gets second chance in Congress
The coalition also emphasized that the burden of opting out falls entirely on the borrower, who must notify the CRA and wait five business days for the opt-out to take effect, which then lasts for five years. During that window, borrower data remains eligible for sale.
If passed, the bill would significantly narrow when and how trigger leads can be sold.
The coalition said the legislation “would stop the abusive use of trigger leads – while narrowly preserving them for legitimate, transparent, and accountable uses.”
The joint letter was signed by the following organizations: Mortgage Bankers Association, National Association of Mortgage Brokers, NATIONAL ASSOCIATION OF REALTORS, National Association of Home Builders, American Bankers Association, Independent Community Bankers of America, America’s Credit Unions, Consumer Federation of America, National Consumer Law Center (on behalf of low-income clients), Center for Responsible Lending, Broker Action Coalition, Leading Builders of America, National Housing Conference, Community Home Lenders of America, CONSUMER ACTION, Housing Policy Council, and the USPIRG.
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