The Vikings notoriously captured slaves and forced them to row their longboats or warships. And if the slaves did not row hard enough, they were whipped and beaten (sometimes to death).
The Greeks and Romans did the same thing, reminding us all that being a slave on a warship was probably not a good career choice.
I mean, what were their parents thinking? “Mom, I am thinking about becoming an ancient warship slave…” (This is one of those times where parents definitely needed to be more assertive)
Anyway, I share this to illustrate a point: being an ancient slave on a warship is not dissimilar to being a “call-center” loan officer.
Those Call Centers Buy “Trigger Leads”
Trigger leads occur when credit bureaus sell a consumer’s contact information to third-party lenders or brokers after a mortgage application credit inquiry.
This then results in an unsolicited onslaught of calls, emails, and texts – mostly from call center lenders.
Call centers are typically large lenders with huge boiler rooms filled with inexperienced loan officers, unfamiliar with local markets, and forced to pound the phones all day long.
And those call center loan officers are pushed to produce almost as aggressively as those poor guys on the Viking longboats.
As a result, some of our clients have received as many as 100 calls after their credit has been pulled (not to mention the texts and emails).
The aggressiveness is both appalling and shocking.
Why Lenders Hate Trigger Leads
Most people think that lenders hate trigger leads simply because they don’t want the competition, but that is hardly the case.
- Call center loan officers mislead borrowers. Mortgage lending is often extremely complex nowadays, requiring the understanding of hundreds of guidelines for dozens of loan programs, down payment assistance, non-QM products, bridge loans, low-income loans, and more. Inexperienced call center loan officers frequently lack the necessary experience to navigate these waters, and they woefully mislead borrowers as a result. This fosters frustration, delays transactions, and sometimes costs borrowers dearly.
- Borrowers get inundated. Believe it or not, most lenders actually like their clients and they don’t want to see them get crushed with unsolicited phone calls, texts, and emails.
- Stealing work. I have seen good lenders put 25 hours or more into structuring a file – only to have a call center LO steal the loan at the 11th hour. It would be like a real estate agent showing 25 homes to a client – only to have the client write an offer with another agent for the 26th home.
What to Do? Opt-Out!
Consumers should “opt-out” of having their data sold by the credit bureaus. I have blogged about this many times, and we have an excellent webpage that explains how to do this: How To Opt-Out Of Having Your Data Being Sold By Credit Bureaus.
Good News: Legislation Pending
There is currently anti-trigger lead legislation (passed by both the House and the Senate) that is sitting on the President’s desk, waiting for signature.
The Homebuyer Protection Act would prohibit credit bureaus from selling borrower data, and it will go into effect 180 days after the bill becomes law.
Assuming the President signs, this is great news. But it is a certainty that the credit bureaus are in panic mode and lobbying the President hard, as lead selling is a big chunk of their revenues.
In any case, until the legislation becomes law, we continue to encourage everyone to OPT-OUT.
