A New York congressman is seeking to ban a practice that he worries puts people looking to buy a home at risk. 

Bronx Democrat Ritchie Torres has introduced legislation prohibiting so-called “trigger leads” for residential mortgages. 

What You Need To Know

  • Rep. Ritchie Torres has introduced legislation prohibiting so-called “trigger leads” for residential mortgages

  • What's a trigger lead? After applying for a mortgage, an applicant’s information can be sold by credit bureaus to other lenders. Those lenders can then reach out with other offers

  • In a statement, a spokesman for the industry trade organization representing credit bureaus said, "Lenders making timely credit offers can maximize consumers’ choices when they need it most"

Trigger leads work like this: After applying for a mortgage, an applicant’s information can be sold by credit bureaus to other lenders. Those lenders can then reach out with other offers. The leads can prompt unsolicited calls, texts, and mail.

Some argue these are helpful for consumers, providing them with a better sense of their options, including possibly better rates. But others worry they can lead to consumers being manipulated.

“The reality of trigger leads is that it often leads to more identity theft, fraud, and predatory lending,” said Torres, who introduced his bill earlier this month. 

This is not the first go for this sort of legislation. Another Democrat introduced a similar bill last Congress. 

Although that bill did not advance out of committee, Torres is undeterred. 

“We have to ask ourselves a simple question: Should businesses have the right to share your personal information, without your knowledge and consent?” Torres said. 

Linda McCoy, the board president of the National Mortgage Brokers Association, is also raising concerns about trigger leads. 

McCoy, who owns Mortgage Team 1 in Mobile, Ala., said she received many calls and texts after she went to refinance last fall. 

Because she is in the mortgage business, most of these calls did not surprise her. However, one did stop her in her tracks. 

The caller, she said, alluded that they were with the very firm she owns. 

“I kind of paused for a minute. And I said, ‘Do you know who you're talking to?’ And they said, ‘Yes, Linda McCoy.’ And I said, ‘Yes, the owner of mortgage team one.’ And silence. Click. They hung up,” she said.

Spectrum News NY1 did reach out to major credit bureaus like Equifax and Experian for comment. 

In a statement, a spokesman for their industry trade group suggested trigger leads are beneficial to consumers. 

“Lenders making timely credit offers can maximize consumers’ choices when they need it most. When shopping for a mortgage this can mean saving thousands of dollars,” said Justin Hakes, with the Consumer Data Industry Association. 

“In a time when interest rates and housing prices are going up, this can help people afford the right home for them,” he continued.