Bipartisan bill on trigger leads wins industry support

Multiple mortgage industry groups are backing the latest bill aimed at curtailing trigger leads, which Sen. Jack Reed, D.-R.I., introduced this week with Sen. Bill Hagerty, R.-Tenn., as a co-sponsor.

The National Association of Mortgage Brokers, Mortgage Bankers Association and the Independent Community Bankers of America support the Homebuyers Privacy Protection Act. The bill would limit use of the leads by amending the Fair Credit Reporting Act.

Mortgage applicants still could opt in to receiving contact from other lenders and there would be certain exceptions. But otherwise the use of trigger leads would generally be limited to entities with pre-existing customer relationships, such as a mortgage servicer or a depository institution where the consumer currently has an account.

Mortgage brokers in particular have long complained that leads from credit inquiries, which bureaus sell to data brokers and lenders, results in a barrage of intrusive consumer marketing.

“To meet with a customer, and to pull credit, and then for that customer to be inundated with phone calls sometimes within an hour of their credit being pulled is just crazy,” said National Association of Mortgage Brokers President Valerie Saunders.

Trigger leads bedevil brokers in particular because they put what are often businesses of moderate size on an uneven playing field.

“Most small business owners are not buying these large-volume trigger leads,” she said.

Trigger leads may take a back seat to other congressional priorities around federal budget negotiations, but the support for the bill and others from both sides of the aisle is significant given the current composition of Congress and how divisive some other issues have been for the two parties as they head into an election year.

“In general, if there’s not bipartisan support for legislation, I just don’t see it going anywhere,” said Brian Chappelle, founding partner at Washington consultancy Potomac Partners. “And you need to get co-sponsors from both sides in both the Senate and the House.”

Reed’s new Senate bill is somewhat similar to one Rep. John Rose, R.-Tenn., introduced in the House this summer. Both would allow trigger lead use in reaching pre-existing customers. 

Another bill that Rep. Ritchie Torres, D.-N.Y., introduced earlier would have banned the sales of leads in a situation where consumers didn’t initiate the credit inquiry and particularly not when a residential mortgage was involved.

Torres’ Trigger Leads Abatement Act of 2023, at deadline had five co-sponsors, including one from the other side of the aisle, Rep. W. Gregory Stuebe, R.-Fla. The others listed were Reps. Ed Case, D.-Hawaii.; Mike Levin, D.-Calif.; Rep. Rashida Talaib, D.-Mich.; and Rep. Earl Blumenauer, D.-Ore.

Rose’s bill, the Protecting Consumers from Abusive Mortgage Leads Act, had nine co-sponsors at the time of this writing, including two Democrats, Torres and Rep. Brittany Pettersen, D.-Colo., that recently signed on to it and Stuebe. The others listed were Reps. Blaine Luetkemeyer, R.-Mo.; Mark Amodei, R.-Nev.; Andrew Ogles, R.-Tenn.; Roger Williams, R-Texas; J. French Hill, R.-Ariz.; and Andy Barr, R-Ky.