To the Point With Bob: Let’s End the Harassment, Deception and Distrust From Trigger Leads
(To the Point with Bob is a periodic blog by MBA President & CEO Bob Broeksmit, CMB. You can view this and past blogs here)
Across the country, from Alaska to Florida, people’s privacy, financial well-being, and even their livelihoods are under attack from a barrage of unwanted emails, texts, and phone solicitations at all hours of the day–simply because they made a query about obtaining a mortgage.
This must stop. The Mortgage Bankers Association’s top national legislative priority is protecting consumers from abuses related to “trigger leads.” We asked our members to share feedback from customers who were subject to a trigger lead solicitation. Here are some real-life examples of the hundreds of testimonials that illustrate the depth and scope of the problem.
First, trigger leads are causing emotional pain and disruption in people’s lives.
• Consider the case of a 73-year-old widower in California who needed to access home equity: “He was practically in tears from the harassing calls, he’s of the generation when the phone rings you answer it. This needs to stop.”
• Another MBA member recalled originating a loan for a relative whose husband is a firefighter: “Because the phone number for his place of business is listed, trigger lead originators bombarded the fire station phones trying to reach him. That put the general public at risk due to these invasive calls and disrupted operations at the station.”
• In South Carolina, a borrower’s nightmare started when she received over 85 phone calls in one afternoon: “She had to answer the phone because she was expecting an update on the health of a family member. She was unable to complete any of her own work that day, and for 5 days after. We need to end this process.”
Second, deception and fraud are rampant with trigger leads.
• An approved borrower with a contract in California received a solicitation: “The borrower thought it was my company and did another loan application with them and they collected a $500 application fee up front. The borrower had just enough saved up for down payment and closing costs–this created a TRUE hardship. Unacceptable.”
• In Missouri, a customer received a call from someone who claimed to be working with the lender. The caller requested a credit card and instructed the customer to sign documents with charges of $150: “Once they found out it was not me, they attempted to get a refund and were told, ‘tough you signed the paperwork’ and they were not refunded.”
Third, abusive trigger lead practices undermine the trust and personal relationships at the heart of the home mortgage business.
• A lender in Mississippi takes pride in supporting local employment and livelihoods for over 30 years and spoke of the pleasure of helping friends, family, neighbors, church members, bank relationships, and so many others: “We spend much time consoling our borrowers as we try to keep the business, because they feel we have let them down. It is very simply wrong. The mortgage industry depends on referrals and repeat business, which we have always enjoyed. This is nearly a bygone notion thanks to trigger leads.”
• An Oregon lender said, “I have been in lending for over 30 years helping thousands of buyers and homeowners. I pride myself in taking great care of my customers. Trigger leads are affecting my borrowers and therefore my reputation.”
These are just a few deeply troubling examples. The good news is there is something Congress can do. Under the bipartisan and bicameral Homebuyer Privacy Protection Act, consumers could only be contacted by companies they know, including their lender, their servicer, and their depository institution(s). This simple reform would sharply reduce the number of trigger leads and end the abusive practices homebuyers have experienced.
The legislation has been co-sponsored by 80 House members and 43 Senators. Senator Bill Hagerty (R-TN) and Senate Armed Services Committee chairman Jack Reed (D-RI) recently attached this targeted solution to the National Defense Authorization Act. MBA is working with lawmakers on both sides of the aisle — including House trigger lead reform champions Rep. John Rose (R-TN) and Ritchie Torres (D-NY) – to make sure this provision is included in the final version of the NDAA. Congress must help homebuyers before it adjourns later this year.
Falling interest rates and improving economic conditions are reviving hopes of homeownership for millions of people and creating new opportunities for existing homeowners. This is the moment for members of Congress to protect their constituents from the harassment and deception stemming from trigger lead abuses – whether first time homebuyers of modest incomes, widowers, or firefighters. Such an action would be supported by a wide range of lenders and provide a huge benefit to the communities they serve.
