I’d like to explain a little about credit reporting – and what the credit bureaus are doing. As you know, the first step in obtaining a mortgage is always going to complete the application process. As is required by Fannie Mae to approve your loan application, we pull your credit with all three credit bureaus (Trans Union, Equifax and Experian).
Then you go home to find half a dozen voice mails and emails from different banks, brokers and lenders claiming that they can offer you “a better deal.”You haven't applied with any of them, but they all seem to have (or pretend to have) your personal information. How do so many more suddenly seem to know you are looking for a mortgage loan? What’s going on, you ask?!
Unfortunate, when you apply for a mortgage, and we pull your tri-merged credit report,this triggers an inquiry with the three credit bureaus. Then Trans Union, Equifax and Experianturn around and sell your information to shadylenders who pay handsomely for these “trigger leads.”
Unfortunately, it is not against the law for the bureaus to do this. And as you know, a credit score with all three bureaus is required for loan approval.
So what can you do? One way to try to prevent this from happening is to register with Optoutprescreen.com. By registering with them, it will stop the bureaus from selling your personal information so you will not appear on any trigger list for 5 years. The trick is this needs to be done at least 5 days before the application process and the credit is pulled.
Do Not Call Registry is also a good option. By registering your phone and cell phone numbers on the registry it will also prevent your phone numbers from appearing on trigger lists. It is best to do this a month before you are going to fill out a loan application as it can take 31 days to take effect.
One way we attempt to prevent this harassment, is by not including your phone numbers or email addresses when we pull credit.It’s easy enough to enter that information after your credit is pulled. While this will does not guarantee that your information will not be sold as a trigger lead, it does make it less desirable to brokers because they need to “scrub” your lead a little more in order to acquire this information on their own.
Some steps have been taken, and we lobby to attempt to ban trigger leads, but they’re still available. There is no way to guarantee your information will not end up as a trigger lead. But by taking the steps described above, you can at least limit your chances of becoming one.
Written By: Rick Underwood
Date: 2/18/20
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