Brokers Action Coalition (BAC) announced earlier this week that Senate Amendment 2358, which aims to limit the use of mortgage trigger leads, has been wiped from the National Defense Authorization Act (NDAA) Fiscal Year 2025, signaling doom to its stakeholders as U.S. Congress rapidly approaches its end-of-year deadline.
Senate Amendment 2358, which stems from the MBA-supported “The Homebuyers Privacy Protection Act of 2024,” 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 or servicing relationship with the consumer.
BAC Chief Advocacy Officer Brendan McKay, followed with LinkedIn posts correcting salacious rumor-mongers that the trigger lead bill is not dead, though it is dying. The BAC’s letter explains that “theoretically” the bill could be voted back into the NDAA FY 2025 in the final days of the current congressional session, though they are aware of the realities of the situation.
“It’s not ‘til it’s over,” BAC executives told NMP in an emailed statement. “The NDAA has to be signed, and until that's happened, and Trigger Leads are not on it, we're going to continue to monitor the situation to look for opportunities.”
Likewise, the MBA will continue with congressional allies to explore remaining options in getting the trigger leads bill passed.
“If that doesn’t occur, we will work aggressively to advance this needed change to the mortgage credit trigger leads policy with other stakeholders next year. In the short term, we will be disappointed that consumers who remain vulnerable to trigger lead abuses won’t realize relief heading into the spring homebuying season,” said MBA’s Chief Lobbyist Bill Killmer.
Another flopped trigger leads bill may allow opposing lobbyists or trade associations to change the terms of the bill, including which kind of lenders are able to access trigger leads.
The Consumer Data Industry Association (CDIA), a lobbying organization for the national credit bureaus, confronted the exceptions written in the trigger leads bill, which is meant to widely limit the use of trigger leads and mitigate telemarketing calls; however, it creates an unbalanced market in which depository banks, credit unions, and retail nonbanks can access trigger leads by holding an account or servicing the consumer’s loan. The only lenders that stand to lose access to trigger leads are mortgage brokers, since it’s uncertain whether they can provide a “firm offer of credit” to be able to access trigger leads.
Long-time advocates for limiting trigger leads, The Community Home Lender of America (CHLA), sent a letter last summer to the CFPB stating, “The CHLA is concerned that some mortgage brokers – which do not have the mortgage banking capability of closing a loan - are making trigger lead solicitations. We do not see how it is possible for a mortgage broker to meet the 'firm offer of credit' requirement in such situations.”
Furthermore, the exemptions for banks, credit unions, and retail nonbanks leaves plenty of room for lenders to continue their bombardment of phone calls, according to the CDIA.
“The current legislative draft doesn’t solve the problem of telephone solicitations,” said CDIA CEO and president, Dan Smith. “We believe any legislative solution should address the root cause — telephone calls — and maintain a competitive market that allows the consumer to shop for a better deal.”
Although McKay wrote on LinkedIn saying that they disagree with the proposals they’ve seen from the CDIA, he told NMP that BAC would be open to improving the text of the bill to garner more support.
“We support the current version of the Trigger Lead Legislation but are open to conversations to improve it early in the Congressional process,” BAC executives told NMP. “And while we disagree with a number of the changes proposed by CDIA, that offer to collaborate extends to them as well.”
The National Association of Mortgage Brokers (NAMB) did not respond to NMP’s request for comment.
