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Are TRIGGER LISTS Putting Us And Our Clients At Risk???

McCue Mortgage, the mortgage company that I work for, holds its monthly Sales Meeting on the third Friday of every month. These meetings are attended by our whole Sales Force, Underwriters, Closers, Marketing, and Secondary Marketing. We usually will cover new loan products during these meetings, as well as industry trends and news. Lately we have been bringing in some of our venders, like Subprime Lenders, PMI Companies, Appraisers, and Credit Report Companies.

Today was no different we had a Subprime vender, and one of our Credit Report Companies in for the meeting. While the Subprime representative had a lot of valuable information to share with us, it was the Credit Report representative that caught my attention. She made us aware of a practice by the three national credit bureaus Equifax, Experian, and TransUnion that has been going on for sometime, but that has just lately reach new heights in this practice. The practice that she was talking about is referred to as “Trigger Lists”

“Trigger Lists” are leads sold by the three national bureaus to anyone who chooses to purchase the information that the bureaus receive and generate when someone’s credit is pulled. You heard it correctly, these national bureaus are selling the private information that is given by Borrowers to Loan Officers when they run their credit. This means that within 12 to 24 hours after I run someone’s credit, these bureaus are taking the information that I took from my Borrower, and selling it without their permission.

I find this outrageous not only because I feel that they are violating my Borrowers privacy, but that they are also selling information that was given to me in confidence to my competitors. These “Trigger Lists” contain my Borrowers name, address, contact information, financial information, credit scores, outstanding balances on revolving debts, mortgage, and even estimates the value of their home. I had to work hard to gain a Borrowers trust for them to provide me with this information, and they turn around and sell it to anyone who wants to pay them for it.

Once one of these companies has purchased this information, they can be on the phone with my customer, using my information, to try to steer them away from me. There is one incident that was reported in which a Borrower was called by another Lender and told that the Lender that they were dealing with had passed on the information to them, because they knew that they would be able to offer them a much better deal.

RealtyTimes gives a very good detailed account of this practice in their October 11, 2006 article entitled “Home Mortgage Applications “Trigger” Sales of Private Financial information” http://realtytimes.com/rtcpages/20060911_mortgageapps.htm In that article they give a great examples of how specific these “Trigger Lists” can be. They state “Most of the trigger lists are provided by the credit bureaus to Internet-based “lead generator” companies that then resell the information to lender customer. One lender, for example, might tell a lead generator to send only fresh data on consumers with FICO scores above 720 who’ve applied for a new mortgage in Texas during the prior 12 to 24 hours. Another lender might only want to see hot leads on subprime applicants in California – people with FICO scores under 620.” The information can be tailor made to what ever the Lender wants.

A major effort is being made by the “National Association of Mortgage Brokers” to put an end to this, but this will require legislation, which means it is not going to happen soon. But there is something that we can do in the mean time. We can advice our Clients to “Opt Out”. Your Clients can remove their names from these lists by calling (888) 567-8688 or online at www.optoutprescreen.com They can choose to “Opt Out” from a five year or lifetime option, and the lifetime option does not require a signed form. Obviously since your Clients information can be sold within 12 to 24 hours, they need to do this ASAP.

Starting this day forward I will be providing everyone that I run credit on with this information, and letting them know that if they are contacted by someone, this is how they got their information. I don’t know about someone else, but if someone were to contact me after I was aware of this, they would get more than they bargained for from me. I hope you share this with your Clients as well. Prepare them for the phone calls that they might receive from people who not only obtained their personal information without their permission, but also for the deception that they might try to use on them.

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Info about the author:

George Souto is a Loan Officer who can assist you with all your FHA, CHFA, and Conventional mortgage needs in Connecticut. George resides in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Higganum, Haddam, East Haddam, Chester, Deep River, and Essex. George can be contacted at (860) 573-1308 or gsouto@mccuemortgage.com

Posted by George Souto on 11/17/2006 11:50 PM

Comments (35)

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Originally posted at: George's Blog: Are TRIGGER LISTS Putting Us And Our Clients At Risk???

35 Comments on Are TRIGGER LISTS Putting Us And Our Clients At Risk???

NOV

2006

Great Blog George,

I am wondering how much time you invest on each one, with pictures and everything, it is time consuming right?

This one took me almost three hours tonight, because I couldn't find a picture of a credit report that I liked. I almost scanned a real one with the names crossed out, but the scanner that I have isn't very good so I just kept looking and this one was OK.

But I enjoy it Ray, especially after it is all put together.

George,

You should write a book. OR put all your blogs together for your clients/strategic partners etc. What a great resource of information you are to us here. Of course, I do take all the credit since I invited Phil and Phil invited you. So ....the way I figure it, YOU are all MY fault. :-)

Thank you Linda, if it wasn't for you and Phil I would not know about a lot of the information that I have gotten from AR.

Bill McCue was even reading some of the blogs on here when I went into his office yesterday, because Phil had told him about the site.

So thank you for having invited Phil, and I thank Phil for think of me when he then invited others, I would never have found AR on my own.

I'm shocked, well not really, more like disappointed. It doesn't seem right to me that they should be able to do. When the client gives his personal information to the mortgage people, they have a reasonable expectation that that's as far as it's going to go. Sure they realize that the credit bureaus will use it to provide credit data but I'll nobody expects that it will then be sold.

Thanks for posting this. It's information more people need to be aware of.

I agree with Linda. Maybe not a book, although it's a good idea but definitely pull together your posts for your clients and potential clients.

John, I was shocked to and I am one of those people pulling the credit. Your right it isn't fair, and in my eyes the bureaus are violating people’s right to privacy in more than one way.

George - simply amazing. Selling such confidential information for gain shouldn't be happening. Unfortunately, both Buyers and Sellers get blasted with all kinds of telemarketers and mail campaigns these days. Great post, as usual. Thanks especially for sharing the phone number. I will share this info in our business meeting next Tuesday.

I got a hold of some of these leads to see how they would pan out. Every single custmer was extemely upset , i am suprised that the credit bureaus havent got pinched for this.

Rich, please do pass this information on.

This is very disturbing to me, because I thought that the information collected by the three bureaus was for the purpose of providing credit information to determine a person’s credit history and ability to pay.

Little did I know that they were taking this confidential information and selling it as marketing tool to people who can easily use it a questionable ways.

Eddy, I am glad that it is getting that reaction from people.

I can believe the three bureaus are getting away with this either.

thank you so much for sharing this info! i'll be making sure to share with my buyer clients before they get pre-approved.

Thank you I booked marked this and will be ading the link to my news letters.

I'm saving this article for our next meeting. Our buyer clients should be aware of this nefarious process.

Funny. The consumer couldn't buy information about another consumer, but a vendor can???

Great blog. Thanks

Leigh, that is a great time to give them the information so that they can call and "Opt Out" before the Credit is pulled.

Rob, the more of us spreading the word, the quicker we can put a stop to it.

Lenn, that is point very well made.

"Mortgage George"

Are you trying to get mouthy mouth out of her cage? :0)

Well then, let's start with the word "outrageous"...

Good word to apply on one of those word pictures...

This practice is wide open to abuse!

So, let me ask you, is there anyway to stop this from happening?

TLW "The Lovely Wife"...Curious Minds Would Like To Know...ROAR!

TLW, yes there is a long term solution to this and that is to over turn the legislation that allowed it in the first place. There is an effort to do this by the National Association of Mortgage Brokers, it would be great if the Realtors jump on board also.

I the short term the best way to combat this is by having our Clients call the 800 number and "Opt Out" at the earliest contact with them.

The next best thing is to let them know that if they start getting phone calls, that this is how these people got their personal information, and to let these people know what they think of them and how the aquired it.

You're bookmarked and I will be spreading #'s and words! TLW...ROAR!

Little sister TLW is ROARING, watch out!!!

I know! I tried to put her back in her cage, but she's too quick!...TLW...ROAR!

It just doesn't seem right. There's suppose to be all these right to privacy rules. I'm curious as to why a credit burea wouldn't have to follow these same guidelines.?!?!?!?

Cynthia, it was initially allowed, because our Legislators were sold on the idea that this would create competition that would protect Borrowers from predatory lending. The idea was that reputable Lenders would acquire this information from the National Bureaus and help to inform them of predatory situations. But in reality it has accomplished the opposite. They have made it easier for the Predators to acquire the information that they need to bait and switch and take advantage of people. I welcome competition as long as it is on a level playing field, this is anything but that. This legislation needs to be reversed.

George.... GREAT POST..... this has been going on for some time now though. I have even been contacted by a few of these companies that sell these trigger leads.

And as Eddy mentioned, I am not sure why the credit bureaus haven't been pinched yet either. Does it have to do with lining someone's pockets.

Jeff, they get away with it because someone Congress a bill of goods, using the reasons that I explained in my response above to Cynthia.

Even though it has been around for a while, the reason why we are seeing a lot more of it now, is because the bureaus have reduced the cost for obtaining this information. So with it being more affordable, the questionable lenders are coming out of the wood work and purchasing it.

I don't know about lining someone's pockets, but this is down and out wrong.

George,

I have heard of this going on now for several months. I had an old loan officer call me up and ask if I was buying these leads (he was really wanting to know if I supplied leads now and if I would hire him back.) I told him that I would have no part in these, because I do not agree with the way they are generated.

I have looked into them to get the exact details of how they are generated. Here is a scary piece of information: if you pay extra, you can have these "trigger" lead companies, make the initial contact. If the person is interested, they will do a live transfer with a completed 1003. I have heard that the way they "steal" these leads is by saying "We gathered your information from Equifax/Experian/Transunion and saw that you are currently applying for a mortgage. If you are interested, we can put you in contact with one of our approved brokers." They are decieving the client in thinking it is the credit bureau calling and telling them to use one of their people.

I have not yet come across the opt out feature. I will make sure that I give this website to every client. Thanks for the good post.

Jason, thank you for the added example of the back door tactics that are being used. The National Bureaus have been entrusted with this information and they are betraying that trust by selling this information in this fashion.

Angela, a large part of my business comes from Realtor referrals, and when they refer them to me they usually want an answer from me as to whether or not they are wasting their time with the Buyer. I don't discuss any details with the Realtors, but I do let them know if I will be able to give them a Pre-Approval Letter if he/she finds them a property. They usually want to know this as soon as possible, so I will be telling all of them to have their clients "Opt Out" once they have met with them, so that by the time they call me this has already been done. Hopefully they will all do this so that we do not waist any time in the process.

First thing Monday morning I am hitting the pavement with this information.

NOV

2006

George, this was a blog that I was to blog about later...however, one way to limit your client's visibility is to omit the phone number for one. It is a despicable way of doing business and hard to believe that these folks have the money to buy these lists, but they do. Just another one to add to the list of many!

Great post, George. It is amazing what goes on without most people even knowing.

Glad to see Bill M. checking out Active Rain. I enjoy reading, writing and commenting. Thanks to Linda D. for inviting me to join. The group just keeps growing.

Gena, I have not tried running a Credit Report without also including their phone number. But at our meeting on Friday that suggestion was made and one of the Loan Officers that was there stated that he had tried to run a Credit Report without including the phone number and the system would not let him.

I have tried running them with an address, and it will not let you do that either.

Phil, Bill was sitting there have a good old time reading some of the blogs. I told him to join and comment, let's see if he does it.

NOV

2006

This is a slimy way of doing business and I hope they are forced to discontinue. I have been telling my clients that the "snakes" of the mortgage world will now start contacting them with unbelievable offers. And to let me know when they do. It has worked so far.

Dennis, this is another tool that they have right now, but hopefully through legislation, and by people like you and I warning them in the mean time we can slow it down.