Trigger leads have continued to be a significant lead source for many lenders and brokers.  Equally the same, they have been a tremendous burden to the development of a positive experience for borrowers on the Internet.  CBS did a recent news story on trigger leads that is worth a watch: click here 

A trigger lead is a lead for a consumer whose credit score or report were “pulled” by a creditor such as a mortgage lender or credit card provider.  Once an inquiry is made to a consumer’s credit file, the idea is that by sharing that the consumer’s information with other lenders and brokers, the consumer will receive competitive offers.  Mortgage trigger leads are sold individually after a short time period (i.e., 24 hours) or in bulk by Credit Bureaus (Experian, Equifax, and TransUnion) or third-party service providers.  Although they claim that trigger leads are reserved for legitimate lenders, they are probably thinking of when it was cost prohibitive for small brokers to subscribe, which is not the case any longer.

Although this process has existed for many years, the problem is compounded by the Internet.  Consumers are invited to fill out forms online to receive “competitive offers” from 4 or 5 lenders.  Unfortunately, when credit is pulled by one of these lenders with permission from the prospect, the trigger data is sold and sales calls flood the borrower.  It can be even worse when an SSN is collected by an aggregator and the buyer of the lead pulls credit without permission.

The borrower’s perception will be that it was the online form/application that resulted in the calls.  Filling out a form on the Internet is to allow one to have control over his mortgage shopping.  Trigger leads, unfortunately, take away that control from the borrower, and instead exploit them.

It would be interesting to learn if and how LowerMyBills and its parent, Experian, coordinate Internet inquiries and trigger lead sales, as well as triggers caused by soft-pulls or by premature credit pulls by buyers of their premier product (SSN included). According to a commenter on this blog, Low.com has partnered with TransUnion for a “soft-pull” that will not result in a trigger lead.  Low.com has also made a smart move not to provide the entire SSN number to the mortgage company.

Educating the consumer is an absolute must to make the borrower prefer the Internet channel than walking to his local bank.

- Lead Critic