The divisive issue of trigger leads is garnering more interest under new bill
The mortgage industry is in constant flux, shaped by fluctuating interest rates and evolving customer expectations. Andrew Leavitt (pictured), vice president of West Coast Mortgage Group, told MPA that he’s navigated these challenges by embracing technology and refining customer engagement strategies. And, to stay ahead, Leavitt and his team analysed the strategies of industry leaders.
“We looked at some of the two companies that are doing it the best right now,” he said. “Those two companies would be Rocket and PennyMac, and we looked and [saw] what they were doing that we weren’t doing. What they do is essentially follow what’s called trigger leads, or hard credit inquiries, that are tri-merged credit report pulls. And so we started looking towards that same data on our end as well.”
However, rather than casting a wide net, West Coast Mortgage Group has used this tool strategically, focusing primarily on past clients.
“What we mainly focused on was our past customers, because our easiest customer to get back into the door and bring an initial revenue [is] someone that’s been a past client, versus having to go out and reacquisition a new client,” Leavitt said.
“We use an API connection again to fire off that result into our CRM saying, ‘Hey, Bob’s in the market again and their credit was recently pulled. You should have your loan officer give them a call.’”
The same automated system also tracks interest rate changes, enabling proactive refinancing opportunities. As Leavitt explained, they closed in that 7.25% last year.
“And, when rates got to 6.25% and then their automated trigger went out, letting us know, ‘Hey, there’s a 1% gap on their rate, it might be beneficial to go ahead and do a refinance for Bob as well.’”
‘A lot of people are very opinionated about trigger leads’
While trigger leads offer a competitive edge, they remain a hotly debated topic in the mortgage industry. Many argue they should be banned due to aggressive marketing tactics by some lenders. Leavitt acknowledged these concerns but stood by his assertions.
“A lot of people are very opinionated about trigger leads and the future of them,” he said. “If you’re using trigger leads, in my opinion, and you’re not trying to do what the bulk majority of the vendors that purchase them do – which is calling 90 million times, slight exaggeration – but, you know, calling them pretending to be a different company, or be their prior loan officer, or be the current loan officer, saying that they work on the team… There’s a lot of unscrupulous activity that’s done with trigger leads.”
Misuse of this data often leads to frustration for consumers. “Outside of pretending to be someone that they’re not supposed to be, but just simply going and undercutting or whatever the competition is, there’s also a lot of hatred in that direction as well,” Leavitt said.
“If there is a way to narrow it only to existing companies that the consumer is using, I think that would be definitely something that would be beneficial for them, versus abolishment altogether.”
The future of trigger leads: Reform or Abolishment?
As the chairman of the board of governors for the Nevada Mortgage Lenders Association – also known as the Nevada Local Chapter of the Mortgage Bankers Association (MBA) – Leavitt has been actively involved in legislative efforts to address concerns around trigger leads. He provided insight into upcoming regulatory changes that could significantly impact the industry.
“For those that want trigger leads banned, I can tell them that the good news is that on the Mortgage Bankers Association, from a national perspective, we had very good success with actually getting the bill attached to the national defense bill,” he said. “Because when it’s usually attached to defense legislation, there’s very little that can impede it or get in its way.”
The proposed legislation has already cleared a significant hurdle. “It did successfully pass the House. Senate is next, and then, once it has been fully ratified, it will completely stop the sale of trigger lead data come ETA April of 2025,” he said. “Next up is to get passed by the Senate. But if that does happen, it’s going to change the dynamics of trigger leads astronomically.”
While some advocate for a full ban, others propose a middle-ground solution – restricting access to trigger lead data only to businesses with a pre-existing relationship with the consumer. “You said the keyword right in your question: It’s the consent,” Leavitt said.
“At the end of the day, whether I want to buy it, or a competitor wants to buy the data, regardless of who wants to buy it, it all comes down to consent,” he said. “And if you don’t consent for XYZ to call you, you shouldn’t be getting the phone call, because we all get spammed enough as it is.”
