The National Association of REALTORS had their annual meeting in New Orleans last week. REALTORS from far and wide collected to enjoy the weather and hospitality, serve the community, learn from workshops and vendors, and conduct Association business.
One NAR committee discussed a lead aggregator system (Here we go again! Selling your contact info!) that is allowed in all states but Vermont which involves "trigger lists". Trigger because the consumer's mortgage loan application and subsequent credit check "triggers" placement of their name on a list which is for sale to lead aggregator companies. Because the terms of the original credit check are on the list, it can be sorted (targeted) for kind of application, i.e., mortgage, car loan, or credit card, and companies purchasing the list can then solicit the buyer with lower interest rates or terms than those shown on the original credit check.
Home buyers may think mortgage solicitations arrive because their agent or the mortgage company sold their contact information and shared the mortgage details. That's not the case. Nope, these "trigger list" leads are coming from the big credit bureaus, the very companies that generate your credit scores! It's perfectly legal unless you're in Vermont, and it's very lucrative for the credit bureaus! With the recent concern in our country over privacy issues, especially relating to our credit, this practice is surprising.
Part of the NAR committee's concern about trigger lists is the quality of the company sending the solicitations and the possibility of transactions not closing as a result. Home buyers are already in the process of getting a home and often are using a mortgage company that has proven reputable and ethical. They are a "known" factor in the transaction. The companies referred by your real estate agent are not going to add big fees at the last minute, delay a closing because they didn't get the work done, or worse yet, not produce a mortgage at all. Agents have experienced these very scenarios from unknown mortgage companies, and the file returns to the original lender for "emergency" processing.
It is the home buyer's right and responsibility to make the best financial choices in their mortgage, but do your own shopping. Read the fine print on the solicitations. If you choose one of the solicitors, make sure to get a good faith estimate of the costs. Talk with your agent. See if the fees are normal or exorbitant for your market. If you get to the closing table and there are thousands of dollars tacked on that were not there before, you still have choices. Consult with your agent about your options.
If you don't want your name to appear on "trigger lists", you can opt out by calling 1-888-567-8688 or by going online here. This option will also remove your name from all those "pre-approval" offers that overflow your mailbox!
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