Credit Checks On Would-Be Home Buyers Sends Alert To Mortgage Telemarketers

TELEMARKETING TARGET

These days, mortgage shoppers are telemarketing targets, thanks to "trigger leads" that credit reporting bureaus sell to lenders the instant a consumer's credit file is pulled by a loan officer, says AP writer Brian Bergstein.

Legal but perhaps not much longer

A few states have explored restrictions on the practice, and recently Minnesota's governor approved a block on most trigger leads. A ban is pending in Massachusetts. Potential Congressional action is brewing as well. The House Financial Services Committee is investigating the issue in advance of a broad review of the credit-reporting agencies.

Triggers a recent issue

Mortgage triggers have been sold for the last few years, but have become more of an issue recently. The home-buying binge early in the decade caused an explosive growth of mortgage brokers and companies that now, in a cooling market, a re redoubling efforts to win business.

QUESTIONABLE TACTICS?
Many consumers complain it's a violation of privacy. Some bankers and mortgage brokers claim borrowers are blaming them for the flood of calls. Some consumers think that trigger leads inspire deception from lenders anxious to make a deal.

William Lund, Maine Office of Consumer Credit Regulation director, believes the Fair Credit Reporting Act is being violated because: 1) excessive information is provided on trigger leads, and 2) credit offers are not firm but rather are "fishing expeditions" without benefit to the consumer.

Lund also believes the National Do Not Call Registry and the pre-screening opt-out list are being ignored.

Harry Dinham, National Association of Mortgage Brokers president, is concerned about identity theft. For example, someone could say, "Look I got your information here. I have every piece except the Social Security number. Give it to me again."

WHAT TRIGGERS CREDIT BUREAU ACTIONS

Have you ever wondered?

· Why a credit card company suddenly lowers your credit line despite a sterling payment record?

· How every mortgage lender in the world is aware that you are shopping for a good refinance opportunity?

· Why your mortgage company is suddenly your new best friend?

The answer is credit "triggers," a highly profitable sideline for credit collection bureaus, according to Mortgage News Daily. Lenders, subscribed to a trigger service, are instantly notified of changes in the credit profile of current customers.

These triggers may be employed as:

Collections assistance, a triggering event might be a change in a person's credit history.

A risk alert trigger indicates a customer is taking on substantial debt or exhibits a pattern of late or minimum payments on several accounts.

New Marketing opportunities could be disconcerting to co nsumers who are shopping for a mortgage loan.

Identifyi ng solutions:
If approached about a mortgage application, Bankrate.com offers home buyers and refinancers several ways to protect themselves:

· Get the caller's name, the company and location and ask for the offer in writing.

· Call the Better Business Bureau and Department of Commerce to learn the company's record.

· Contact the state attorney general office if it's a deceptive pitch.

· Block out information by calling (888) 5-OPTOUT (678-688) or log on to www.optoutprescreen.com.

· Reduce the telemarketing calls at home by calling (888) 382-1222 or log onto www.donotcall.gov.

Howard Voyles is co-founder of Focus Publications, a leading provider of innovative integrated marketing tools for the title, mortgage and real estate industries. He is a 23-year mortgage industry veteran, has held licenses in real estate, insurance, fire, casualty and life insurance and a Series 7 securities license. He has taught insurance and real estate professionals and written extensively for the financial services industry. Voyles has coached more than 1,000 mortgage, title and real estate reps on the use of Focus Publications? products and services. An accomplished speaker, he has addressed sales gatherings of mortgage, real estate and title companies. For additional Consumer Focus articles, go to http://www.focuspub.com

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