Trump Signs Bill to Crack Down on Abusive Mortgage "Trigger Leads" and Stop Unwanted Spam

Strategic Insights -

As part of a bipartisan effort to protect homebuyers from unwanted and invasive solicitations, President Trump has signed into law a bill authored by Senator Jack Reed (D-RI) to restrict the sale of "trigger leads." These leads are generated when consumers apply for a mortgage, and their personal information is sold to mortgage brokers and lenders without their consent, leading to a flood of spam calls, texts, and emails.

Key Takeaways:

  • The Homebuyers Privacy Protection Act, signed into law by President Trump, aims to curb the practice of selling trigger leads without consumers' consent, reducing unwanted solicitations.
  • The law will limit the sale of trigger leads to mortgage brokers and lenders unless they have a pre-existing relationship with the consumer or the consumer has opted-in to receive them.
  • Currently, eight states have laws restricting trigger leads, and two more - Idaho and Arkansas - will implement trigger lead laws in 2025.
  • Cosponsors of the bill include Senators from both parties, demonstrating bipartisan support for the legislation.
  • Consumer advocacy groups and financial trades, including the Mortgage Bankers Association and the National Association of Mortgage Brokers, have endorsed the bill.
  • Despite some notable exceptions, the law will help put consumers back in control of their personal information and prevent spam calls, texts, and emails from irresponsible lenders.

Statistics:

  • Prospective homebuyers typically receive over 100 misleading texts, phone calls, and emails within the first 24 hours of applying for a mortgage (NAMB president Jim Nabors).
  • The Homebuyers Privacy Protection Act will amend the Fair Credit Reporting Act (FCRA) to include specific restrictions on the use of trigger leads in the residential mortgage lending space.
  • Trigger leads will only be permitted if a mortgage broker or lender certifies they have a deep financial relationship with the consumer or if the consumer affirmsatively opts-in.
  • The law aims to reduce the burden on homebuyers by preventing their personal information from being sold without consent, dramatically reducing spam calls, texts, and emails from irresponsible lenders.

Sources:

  • Senator Jack Reed (D-RI) news release, September 5
  • National Association of Mortgage Brokers (NAMB) president Jim Nabors
  • Mortgage Bankers Association
  • Independent Community Bankers of America
  • American Bankers Association
  • Community Home Lenders of America
  • The National Consumer Law Center
  • The Consumer Federation of America
  • Americans for Financial Reform
  • Congressman John Rose (R-TN-06) news release (H.R.2808)