Privacy laws and requirements have become a hot topic in recent years, resulting in consumers’ growing awareness of the need to protect their personal information from computer hackers, perpetrators of fraudulent scheme, and other criminals.
What happens when you make a loan application? First your application is reviewed by one of the lender’s loan officers, who runs a credit report.
This credit report informs the credit bureau(s) that you have applied for a mortgage. Your information is then earmarked by lenders who buy targeted lead information from these companies.
No matter how hard consumers work to protect their personal information, this is the harsh reality. The credit bureau codes your information and, if a lender or other organization requests a list of leads that have applied for a similar loan product, you will receive their junk mail (and legitimate offers), regardless of whether you are approved for your loan.
The technical term for these targeted lists of information is a “trigger list”. A trigger list is sent to the requester with the promise to forward new additions to the list within a specific time period following the credit check. This could be as little as an hour, but it is usually within two business days.
You need to watch not only your mailbox, but also your telephone and email inbox. You will receive ads there as well if you provided that contact information in your application. You may receive calls to your home from soliciting lenders, emails from these lenders and even, in rare cases, a home visit.
Trigger lists do not stop with your name and contact information. Requesters may also receive information from your credit report, such as the details of student loans, credit cards, revolving charge accounts and car loans. They have access to almost unlimited information about you, despite all your efforts to keep such information private.
Consumer watchdog groups are trying to limit or eliminate credit bureaus’ ability to release this information to anyone who offers to pay. The National Association of Mortgage Brokers is one group that is disheartened by current practices. It is working to protect the interests of consumers while also maintaining its own well-being.
What about legitimate lenders who purchase leads from credit bureaus? Most industry experts believe that unless a lender has enough information to make a firm offer of credit, it should not be allowed to contact consumers on the trigger lists.
Under fire, the credit bureaus defend the practice and claim that their activities comply with all the regulations imposed on them by consumer-protection programs.
Why is the largest consumer of trigger lists the vast collection of internet companies that specialize in producing lead lists for their clients? Again, the argument is raised that if the leads are not going to a company that is prepared to make a genuine and firm offer of credit, the consumer should never be contacted.
Reprinted with permission by Joy Daniels from Joy Daniels Real Estate Group.
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