Why Borrowers Get Spam After Their Credit Is Pulled

Why Borrowers Get Spam After Their Credit Is Pulled

A borrower needs a mortgage to purchase a home. They contact the mortgage broker or bank they want to work with, apply for a mortgage loan, have their credit pulled, and boom! they start getting spam calls out of the blue asking if they are buying a home. Why? Why are they getting calls from people they have never heard of? How did these folks get their information?

What I described above is a "trigger lead". When someone applies for a mortgage loan and their credit gets pulled their information is often sold to a competing lender who buys trigger leads. Some lenders pay the credit bureaus (Trans Union, Equifax, and Experian) to provide them with leads. They have sales people sitting there waiting to snag a lead and see if they can grab the borrower for their pipeline vs the broker or banker they intended to work with.

Trigger lead buyers have certain aspects of the credit report that they consider a positive attribute they are looking for; perhaps it is credit score, on time payments, etc.  When a known lender pulls credit then it triggers the lead. There is a lender willing to pay for the information who will hand it to a sales person to follow up.

Is selling your information legal and what can you do about it?  Sadly, it is legal but you can take some steps to help the situation. 

When I pull credit I purposefully leave out the contact information for the borrower. It may not be fail safe to stop spam after the credit is pulled but it may make it a little harder for the trigger lead buyer to find the borrower. If they are going to get to the borrower they need to work at it. I usually try to give the borrower a heads up about spam calls and that they will only speak to me about their loan because some trigger lead buyers will pretend to be me.

You can opt out with the credit bureaus. Each of the credit bureaus, Trans Union, Equifax and Experian, can mark your file to opt out from these spam calls. You likely will need to check back to make sure it does not expire, generally opting out will last five years.

You can go on a DO NOT CALL.   Do not call may not help with robo calls but should be more effective for mortgage loan activity. You can list your phone including cell on the registry to prevent trigger leads.