Trigger leads, the long-debated and controversial lead generation strategy, may disappear next year under a nationwide ban after the U.S. Senate bill, “The Homebuyers Privacy Protection Act of 2024,” was incorporated into the Fiscal Year 2025 National Defense Authorization Act (NDAA). Given that Congress must pass the annual NDAA budget each year, organizations and professionals in the mortgage industry are anticipating a ban on trigger leads to come down soon.
The bill, Senate Amendment 2358, put forth by Senate Armed Services Committee Chairman Jack Reed (D-RI) and Ranking Member Roger Wicker (R-MS), aims to broadly limit the distribution and use of trigger leads sold by the national credit reporting agencies to various mortgage companies, unless the company was given proper consent, originated the loan, or has a current banking relationship with the consumer.
The bill’s text specifies what exceptions qualify lenders to receive a trigger lead:
“(i) has submitted documentation to that agency certifying that such other person has, pursuant to paragraph (1), the authorization of the consumer to whom the consumer report relates; or
(ii) (I) has originated the current residential mortgage loan of the consumer;
(II) is the servicer of the current residential mortgage loan of the consumer; or
(III) (aa) is an insured depository institution or insured credit union; and
(bb) holds a current account for the consumer to whom the consumer report relates.”
Mortgage Bankers Association (MBA) President and CEO Bob Broeksmit shared his elation that the Senate amendment included in the Department of Defense's fiscal budget for 2025 used text of the MBA-supported bill (“Homebuyers Privacy Protection Act”) to end the “abusive” use of mortgage trigger leads.
“We commend the bipartisan leadership of Senator Bill Hagerty (R-TN) and Chairman Reed, along with their 40 bipartisan Senate cosponsors, to advance this carefully-calibrated consumer protection amendment as part of the NDAA debate,” Broeksmit said in a public statement. “MBA will continue to work with lawmakers on both sides of the aisle — including trigger lead reform champions Rep. John Rose (R-TN) and Ritchie Torres (D-NY) – to highlight the importance of preserving this important proposal during the forthcoming Senate debate and eventual NDAA negotiations between House and Senate leaders later this year.”
Likewise, a number of other mortgage trade associations have been rooting for the downfall of trigger leads, including the Independent Community Bankers of America (ICBA), which urged support for the amendment in a letter sent to the Senate this past July.
“Trigger leads are prone to abuse by lenders that have no relationship to the applicant. As a result, applicants have been inundated with unwanted and invasive solicitations so frequent that many believe their accounts have been hacked,” the letter by ICBA read.
Broker Action Coalition (BAC) Co-Founder and CEO Katie Sweeney, when she first stepped into her advocacy role, said that trigger lead reform is the number one item on the agenda.
"Over the last two years we have taken 211 meetings on Capitol Hill advocating on the issue and we are incredibly happy with the progress and where the legislation currently stands," said BAC Chief Advocacy Officer Brenden McKay in an emailed statement. "But the work is not done. It is CRITICAL that the legislation remains in the final version of NDAA and anyone that has not already needs to email their member of Congress now. Whether it's through the BAC or MBA please complete a call to action today and help us push this across the finish line."
The Association of Independent Mortgage Experts (AIME) is largely against trigger leads, which is evident by an open letter that AIME Chairman Jonathan Haddad sent to members after being criticized for his company's use of mortgage trigger leads. Yet, in a video posted to the Brokers Are Better Facebook group, he said, “I am for the banning of credit triggers."
