Ever wonder why the phone won't stop ringing after applying for a loan? Does it seem like your mailbox gets a little more full of junk mail and refinance solicitations from lenders you've never heard of (usually showing off loan terms that seem 'too good to be true')? If so, you've been turned into a trigger lead!
What is a Trigger Lead
When your credit is pulled, the credit bureaus have a record of the credit inquiry, and unfortunately, they sell this information to bidders in the form of prescreened lists sold as “leads”. This generated “lead” is sold to lenders, letting them know you’re in the market for a mortgage. The data is sold with complete disregard for your privacy or your desire or lackthereof to talk with any lenders or loan officers. Seem unethical? They are, at least in this writer's opinion. Worse, they're also often used by disreputable lenders trying to prey on people that don't read fine print. The good news is that there are some things you can do to eliminate, or at least mitigate the number of calls coming in.
What You Can Do
- Opt-Out of prescreened offers.
- Register with the Do-Not-Call Registry, donotcall.gov.
- Contact the Federal Trade Commission.
- Contact Congress.
- Stop other forms of direct marketing by visiting the Direct Mail Association’s Web site at: dmaconsumers.org/consumerassistance.html.
Since many “trigger lead” lenders are not reputable, it’s best to ignore these calls and the mail that is likely to show up in your mailbox as well, and to pay attention to the fine print – many times the mail sent is designed to look like it’s from your current lender, with only the fine print showing who the real sender is. These mail pieces often contain “too good to be true” loan terms, and again, in the fine print you’ll usually be able to see enormous fees and other loan terms that are not borrower-friendly.
It’s important to know that your loan officer or lender doesn’t initiate these calls, and it’s not the credit pull itself that causes these calls, but the credit bureaus selling information after the credit pull and them placing you on a prescreened list. One piece of good news to keep in mind as well is that these additional calls and mail do NOT mean your credit was run again – while a hard credit inquiry by your original lender will appear on your credit report, any other companies calling do NOT have access to your credit report or history, so the calls you’ll receive do not mean any of your personal private information was compromised.
If you're in the market for a home or are considering a refinance and you have your credit pulled, expect the phone to start ringing, and for best results, put the 'ignore' button to work on your phone!
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