WASHINGTON, DC – In an effort to give prospective homebuyers more control over their personal information, the U.S. Senate approved the Homebuyers Privacy Protection Act (S. 3502) to dramatically reduce spam calls, texts, and emails from irresponsible players in the mortgage industry.

Authored by U.S. Senators Jack Reed (D-RI) and Bill Hagerty (R-TN), the bipartisan bill would crackdown on the misuse of mortgage “trigger leads” – which occur when a consumer’s credit inquiry “triggers” the sale of their information to third-party lenders and businesses.  When a mortgage lender runs a credit check during the process to buy a home, it appears on the consumer’s credit report. The major credit reporting bureaus (including Equifax, Experian and TransUnion) may then sell that information to other lenders or brokers, which then use it to contact consumers unprompted, often in a predatory manner, to solicit business.

According to the National Association of Mortgage Brokers (NAMB) president Jim Nabors: “It is not unusual for bank customers to receive 100+ misleading texts, phone calls and emails within the first 24 hours of applying for a mortgage and the passage of this bill will go a long way in relieving this burden to homebuyers.”

Prospective homebuyers who are bombarded by these kinds of solicitations typically have no idea their information was sold without their consent.

The Homebuyers Privacy Protection Act would limit the ability of credit reporting bureaus to sell trigger leads to mortgage brokers and lenders when the bureaus learn that a consumer has applied for a mortgage. This legislation would prohibit trigger leads, with very limited exceptions for institutions that a consumer currently knows and trusts.

“Buying a home is already a complex and stressful process. Consumers should not get needlessly ‘spammed’ with unsolicited, predatory offers just because they take a necessary step in the homebuying process,” said Senator Reed, a senior member of the Banking, Housing, and Urban Affairs Committee. “The Homebuyers Privacy Protection Act will put consumers back in the driver’s seat and help cut down on the spam.  It will help reduce predatory practices and provide much needed relief from unwanted industry calls, texts, and emails.”

This bill would prohibit credit reporting bureaus from selling a trigger lead unless a mortgage broker or lender certifies to the bureau that they already has a deep financial relationship with the consumer, such as an existing mortgage loan or a deposit account.  Trigger leads would also be permitted if a consumer affirmatively opts in to receiving them.

The Homebuyers Privacy Protection Act is supported by a broad coalition of consumer advocacy groups and financial trades, including the Mortgage Bankers Association, the Independent Community Bankers of America, the American Bankers Association, the National Association of Mortgage Brokers, the Broker Action Coalition, the National Consumer Law Center (on behalf of its low-income clients), the Center for Responsible Lending, the Consumer Federation of America, and others.

Now that the bill has passed the U.S. Senate, it must be cleared by the U.S. House of Representatives.  Identical bipartisan legislation (H.R. 7297) introduced by Congressman John Rose (R-TN) is pending in the House.

In addition to Hagerty and Reed, the Senate bill was backed by 41 cosponsors, including Senators Deb Fischer (R-NE), Jeff Merkley (D-OR), Pete Ricketts (R-NE), John Fetterman (D-PA), Marsha Blackburn (R-TN), Chris Van Hollen (D-MD), Mike Braun (R-IN), Tina Smith (D-MN), Katie Britt (R-AL), Jeanne Shaheen (D-NH), Angus King (I-ME), Mike Rounds (R-SD), Mike Crapo (R-ID), Kevin Cramer (R-ND), Sheldon Whitehouse (D-RI), John Thune (R-SD), Brian Schatz (D-HI), Tommy Tuberville (R-AL), Rick Scott (R-FL), Bill Cassidy (R-LA), Elizabeth Warren (D-MA), James Risch (R-ID), Jon Tester (D-MT), Mark Warner (D-VA), Shelley Moore Capito (R-WV), Tim Kaine (D-VA), Cindy Hyde-Smith (R-MS), Catherine Cortez Masto (D-NV), Joe Manchin (D-WV), Richard Blumenthal (D-CT), Tom Tillis (R-NC), Tammy Baldwin (D-WI), Kyrsten Sinema (I-AZ), Amy Klobuchar (D-MN), Michael Bennet (D-CO), Peter Welch (D-VT), Jacky Rosen (D-NV), Gary Peters (D-MI), Bob Casey, (D-PA) Jerry Moran (R-KS), Ron Wyden, and Ed Markey (D-MA).