The U.S. Senate has announced the passage of the bipartisan Homebuyers’ Privacy Protection Act (S. 3502), a measure that will ban trigger leads except in limited circumstances.
When a consumer applies for a mortgage, credit bureaus are notified that the consumer is interested in financing, which is referred to as a “trigger lead.” That information is then sold by the credit bureaus to data brokers (including other lenders) without the consumer’s knowledge or approval. Consumers are then often bombarded with hundreds of calls that may lure them away from their chosen lender.
The Homebuyers’ Privacy Protection Act S. 3502) was introduced by U.S. Rep. John Rose with 43 bipartisan co-sponsors.
When the measure was first introduced in February 2024, U.S. Rep. Ritchie Torres said, “Trigger leads exploit consumers’ financial inquiries, turning them into commodities sold without consent. We must empower homebuyers, not bombard them with predatory calls. This bipartisan legislation takes a crucial step in safeguarding consumer privacy and choice in the mortgage process.”
S. 3502 specifically prohibits a consumer reporting agency from furnishing a trigger lead unless an individual chooses to opt-in. In that case, only certain approved groups will be notified that an individual is seeking a new mortgage. The bill is tailored to give consumers more control over the information they receive as part of the homebuying process and eliminates trigger lead abuses, while preserving their use in appropriately limited circumstances.
According to Colin Barrett, President and CEO of the Tennessee Bankers Association, “It is not unusual for bank customers to receive 100-plus misleading texts, phone calls and emails within the first 24 hours of applying for a mortgage.”
“MBA applauds the Senate for passing legislation we championed to stop the abusive use of mortgage trigger leads while preserving their use in appropriately limited circumstances during a real estate transaction,” said Mortgage Bankers Association (MBA) President and CEO Bob Broeksmit, CMB.
Rep. Rose added, “Buying a home is stressful enough for many consumers. The last thing most folks want is to be annoyed incessantly by the constant barrage of emails, text messages, and phone calls after they apply for a mortgage. My bill would put an end to this shady and confusing practice and restore data privacy for homebuyers.”
S. 3502 moves on to the House of Representatives for approval prior to the Congressional winter break. Click here for more information on S. 3502—The Homebuyers’ Privacy Protection Act.
