Many times when you apply for a loan, you will be bombarded with offers from competing banks and lenders.
The reason this happens is because the credit bureaus sell your information to these other companies.
They are known as trigger leads, which they are activated when you apply for a loan and your credit report is released.
It serves as a sign that you are currently applying for a home loan and allows others to expose you to that secret.
To avoid being inundated with texts, phone calls, and emails, you can check out early.
First Some Background on How This Works
As noted, a credit application, such as a mortgage involving a credit crunch, triggers an investigation from the credit bureaus.
These institutions, including Equifax, Experian, TransUnion, and even the fourth, Innovis, are informed that you are looking for a loan.
While this is all well and good as you usually need a credit check to get approved for a loan, credit bureaus are for-profit companies.
So instead of just making money off the loan, they will also sell mortgage and refinance leads to banks, loan officers, mortgage brokers, etc.
This allows them to make more money, and it allows the loan originators who buy them to close more loans. Assuming they can win your business.
However, the collateral damage may be to you, the consumer, in the form of major upset.
You see, it’s not just the odd phone call or email. It can be dozens or close to a hundred calls, texts, and emails, all within the span of a few days.
Because of this perceived injustice, a number of bills were introduced to block the initiative, including one that received 90 sponsors in the House and 43 in the Senate.
And while it looks very promising that it will pass, it has just been pulled from the National Defense Authorization Act (NDAA).
In other words, help is not coming. And the credit bureaus will still sell your data. So what can you do?
Use the First Opt-Out Screen to Keep Your Information from Being Sold
One thing you can do to turn off all these offers is to opt out using OptOutPrescreen.com, which is the official website of the Consumer Credit Reporting Industry that processes these requests.
It’s very simple. Just visit that website, click checkout, and fill out a short form with your name, address, social media, and date of birth.
Also indicate if you want to opt out electronically for five years or permanently by post. Personally, I just go with five years because it’s easier (no time for stamps and envelopes) and there might be a time when I actually want the supplies.
Note that your name will be removed from the list provided by the credit bureaus for “strong credit or insurance” for a total of five years.
However, will not stop all offers. So consider it a partial solution at least to reduce the supply.
Tip: It may take up to five days for an opt-out request to be processed, and it may take several weeks before you stop receiving offers. So do it right before you start shopping for a mortgage.
You can also add your phone number to DoNotCall.gov and if you really want to be aggressive, sign up at DMAchoice.org to reduce your spam/email. But that last option requires less money.
What Else Can You Do to Avoid a Scam Mortgage Offer?
Some simple things you can do to reduce offers is to mute unknown callers if it’s an option on your smartphone.
You can also try using a temporary phone number like Google Voice in hopes of avoiding certain calls and texts.
And you can ask your loan officer or real estate agent to do a soft loan for you first to avoid triggering these leads in the first place.
But eventually you will need to do some hard work if you want to proceed with a real mortgage application.
The last (important) thing to note here is that you may want to get more than one loan estimate.
Many buyers stop at the first offer they see and never set aside time to buy. This is actually why attempts to stop trigger tracks have failed.
Even the FTC pointed out that “this offer can help you learn about what’s available, compare costs, and find the best product for your needs.”
Freddie Mac research found that getting a second mortgage discount can save a homeowner between $966 and $2,086 over the life of their loan.
I also argued that you will learn more about the lending process, the mortgage lingo, and perhaps become a better negotiator if you talk to a few different companies.
Granted, it’s one thing to talk to a few, and another to receive hundreds of unwanted texts and phone calls.
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