Applying for a Mortgage Loan – Is Your Information Safe Consumer Information

For approximately the past two years the mortgage industry has provided personal information to other lenders and partners when a consumer applies for a loan. I know this is shocking. I was just as shocked as you are when I found out. As soon as the ink dries on your mortgage application your information is sold to other lenders. In one or two days your phone starts ringing off the hook with calls from other lenders trying to offer you a better deal. This process is called a “trigger lead.”

When your credit report is pulled by a mortgage lender or broker the lender’s request for your credit report triggers an alert which informs the 3 major credit bureaus, Experian, Equifax and TransUnion that you are a potential lead looking to purchase a home or refinance your existing loan.

The credit bureaus sell these trigger leads to lenders and brokers who have subscribed to the service and provide them with a list of potential candidates who are looking for a loan and meet the lenders criteria for a loan.

Experian has a trigger lead service called Prospect Triggers that can pull out all of the consumers from the Experian consumer database that fit a lender’s credit criteria such as consumers who have never filed for bankruptcy or consumers who have a certain credit score. Information such as the number of credit cards a consumer possesses and contact information such as applicant name, address and telephone number is provided.

I feel this is a violation of privacy. Companies feel that because you list your personal information on an application they have the right to contact. I rarely get unsolicited phone calls but I recently received a call from a telemarketer and asked the caller why companies feel that they have the right to contact a consumer simply because they have access to a consumer’s contact information. I also informed the caller that I only give my phone number to people I wish to speak to which does not include telemarketers and requested that my contact information be removed from their call list and third party call lists.

Many mortgage industry staff believe trigger leads are helpful for lenders and brokers. However, I believe a customer would get a better deal if they shopped around for various offers. When a lender or broker already has some basic information about you they can develop a plan to their advantage and although the deal may sound good it may not be the best deal for you. If you comparison shop you have the upper hand because you can ask specific questions related to the type of loan you are looking and then make a decision about what company you want to do business with without feeling pressured by constant calls from lenders and brokers.

When your credit report is pulled for a lender or broker you can request that they do not enter your telephone number which may reduce telemarketer calls. However, they are phone matching programs available that can be used before the trigger leads are sold. Also as long as they have your SSN they can match up your name, address and phone number.

The sad part about this is the credit bureaus provide trigger leads to lenders and brokers and also provide consumers with opt out services. The credit bureaus make their money upfront by quickly selling your information so by the time you opt out your information has been sold many times over making them rich.

Remember when applying for a loan or filling out any application that requests your personal information immediately ask the following questions:

1. What security measures are in place to protect my personal information?

2. How the company experienced any security threats or attacks and if so how were they handled?

3. What is your privacy policy? Ask for a copy of the privacy policy or how it can be obtained online.

4. I elect to leave the SSN field blank do you have another unique number that can be used to identify me.

5. If I end my business relationship with the company how long is my personal information stored in the company database?

6. What is the method for obtaining my personal records when I end my business relationship with the company?

7. What procedures are in place to protect customer information if the company goes bankruptcy or merges with another company?

To reduce telemarketer calls register your telephone number at http://www.donotcall.gov or call 1-888-567-8688. Comparison shop on sites like http://www.bankrate.com. Research a company by calling the Better Business Bureau or Department of Commerce. File a complaint against the company with the Federal Trade Commission or your state Attorney General’s Office if you feel the sales tactics used are unprofessional or deceptive.