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Your Data Will Be Sold When You Buy A House

Certified Mortgage Advisor
NMLS 1701021
Published 
February 5, 2023

Know why your information is all over the place

Are you curious if your lender has been selling your information? A lot of people have this fear and they wonder why when they go and put a mortgage application, they're go all of a sudden gonna get harassed with tons of phone calls, all these spam calls and emails and even possibly mail that may come in. And I saw this post on the real estate subreddit where they're saying PSA for anyone inquiring about a mortgage.

Credit rating companies are doing it, why?

I saw this post on the real estate subreddit where they're saying PSA for anyone inquiring about a mortgage. A couple of days ago, I submitted an application for pre-approval. I let them do a credit check, which is what you need for a good, solid pre-approval as a credit check. What happens, is Equifax sold the information that inquired about financing and I received 73 calls yesterday from random lenders.

I complained to my lender about it, and apparently, the credit bureaus are just allowed to do this. Is there anything I can do to retaliate?

Trigger Lead

I totally get the sentiment. So what I wanna do is explain how this works and what you can do, what's within your control. So this is what's called a Trigger Lead in the mortgage world. So this is how it works.

There's nothing your lender can do. If they could get this to stop, I promise you they would get it to stop. Or they would do everything they can to make it stop.

So what ends up happening is you have the credit bureaus, Equifax, TransUnion, and Experian you go and you apply for a mortgage. So, basically, a lender's gonna have to check your credit report for a solid pre-approval, and then that credit report is gonna go out to those three companies and say, Hey, we want data on that person's credit report, on your credit report.

Your information as their product

Then what ends up happening is Equifax, Experian, TransUnion, one, two, maybe all three. Then go, oh, hey, you're looking at buying a house. What if we sold that information to other lenders who wanted to purchase it? So out there, there are other lenders who I think probably are not, I would argue, or maybe not the most ethical they go and they say, Hey, we wanna purchase the information of anybody who got their credit pulled.

Then what they do is those credit bureaus will then go and say, here's John Smith's phone and email and information about them, and here it is for X amount of dollars that lender may purchase it and then call you.

This is, unfortunately, a very common practice in the mortgage world called a Trigger Lead. They purchase trigger leads and it's very unfortunate.

Let's make every lender call you!

So it's supposed to help you shop, in theory, what these credit bureaus are saying.  is, oh hey, like you applied for one mortgage, instead of having to apply for more we'll just call. We'll have other people call you, unsolicited.

Making money with your information

In reality, it usually doesn't help anybody get a better offer. What ends up happening is these companies, these credit bureaus actually make more money. They take your information and then they go and sell it to other lenders.

WE don't sell your information

I personally don't think it's good to work with a lender who does purchase these trigger leads, so I don't know that they would be the good ones to work with.

Your loan officer cannot change this, and I promise you they would want it to change. I've had people who have asked me before where they're like, Hey, we applied and then all of a sudden we got tons of calls. Why did you guys sell our information? And that promises you. We didn't we would not try to create competition for ourselves, right?

I work on a team of loan officers. We do loans in all 50 states, and we love to help you. And I promise you, we're not gonna try to introduce you. We're not gonna give your number to 70 other lenders because that would put us out of business. Why would we prefer that? Your loan officer wants this to change the law.

This is what needs to change to prevent this. Unfortunately, the way that the lobbying has worked on behalf of the credit bureaus is the law in place right now allows this to happen. And there really needs to be a law to change these mortgage trigger leads because what ends up happening is you just get a bunch of people who get harassed and spammed with relentless calls.

Here's what you can do

You can ask your lender to remove your phone number. Running your credit. Now, this is not guaranteed to help fully. So what ends up happening is when your lender does run your credit, the information that you submitted will go along with that credit inquiry.

Not all of the information, it depends on the credit reporting agency will get pushed over. But primarily it's gonna be your name, your Social Security number, and your address and date of birth that's needed to actually initiate that credit pull. Sometimes what can be transferred over as well is your phone number and email, if that's included on your application.

Removing your phone number

Now, your lender can remove that before they do the credit pull. So this is not guaranteed to help, let's say, before running a credit report. We go ahead and remove your personal information at least your phone number and email your contact information from the credit report or the credit report request. Even if we push that through.

Keep in mind that there is tons of data out there about who you are, your phone number, your address, your email address that's in all of these databases online that even if your phone number isn't included on there, it's very likely they'll still be able to find your phone number. So it's not fully guaranteed to help, even if your lender does everything they possibly can, which unfortunately is not much based on the current situation of things.

It's not guaranteed.

Do Not Call List and Opt-Out Pre-Screen

So what you can do again to help a little bit is get on the do not call list. That's something that could help. Also going to opt out of pre-screen. This is supposed to prevent all of these offers, but unfortunately, it's the same thing with robocalls there are all these laws that say robocalls aren't allowed, but we still get 'em all the time.

So if you opt-out online, it opts you out for five. Why I don't know. You have to do it every five years or if you opt out by mail, it's permanent.

Create an email exclusively for your homebuying

Also what I would suggest is setting up home-related phone and email accounts. This is free and easy to do, so this is what I would recommend you do at least email. Start an email before you go through the home-buying process and just call it SmithFamilyHome@gmail.com, or something like that. Have a separate email address for all your home-related stuff. Not only is this gonna help protect your personal email from any sort of spam offers and things like that, or solicitations it also is gonna help keep all your stuff organized.

Maybe you needed to remember some document from two years ago after you close on your home, it's gonna be in that email account. So that can be helpful there as well.

Set up your Google voice number

You can also set up a Google Voice number when you are talking or any interacting with anybody in the home-buying world.

Remember

One thing I would just be mindful of here is don't just set up these accounts and forget about them because, for instance, if you're talking with a realtor over a Google Voice number, that's fine. But if that realtor needs to reach you and you're just been ignoring that number you may lose out on an offer or an important piece of information that you needed to know about someone you did want to work with.

So what's very possible, something you could do is when you're looking at putting in general information, you can use these as options. And then when you decide on somebody you wanna work with, of course, you can then give them maybe a cell number or a personal email so they have better contact with you.

Ignore the offers

Then finally is to ignore the offers as much as you can. Sometimes I know so many people who like answering spam calls and they wanna fight with people. Just don't answer the phone. It'll save you a lot of stress. . You don't need to fight with people. You don't need to fight spam calls.

Just if they say, Hey, this is from whatever. I just press delete, or press hangs up. It's not that hard. So unfortunately there is no easy fix to this. In the mortgage world, trigger leads exist. The law needs to change for those to go away. In the meantime, you can do these things to try to help.

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Kyle Andrew Seagraves is Federal Mortgage Loan Originator (NMLS 1701021) licensed in all 50 states with the Dan Frio Team at Allied First Bank (NMLS 203463), an Equal Housing Lender. Separately, Kyle owns Win The House You Love LLC, an education company. Win The House You Love LLC is not a lender, does not issue loan qualifications, and does not extend credit of any kind. This website is only for educational usage. All calculations should be verified independently. This website is not an offer to lend and should not directly be used to make decisions on home offers, purchasing decisions, nor loan selections. Not guaranteed to provide accurate results, imply lending terms, qualification amounts, nor real estate advice. Seek counsel from a licensed real estate agent, loan originator, financial planner, accountant, and/or attorney for real estate, legal, and/or financial advice.

Servbank is not affiliated with the VA, FHA or any other government agency. This site has not been approved by any government agency.
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