Have you experienced a sudden increase in phone calls or junk mail from various lenders after applying for credit or insurance? It can feel like an invasion of privacy when companies you haven’t contacted seem to know about your recent application. This surge in solicitations is often due to a practice called “trigger leads”.
Trigger Leads: How They Work
When you apply for credit or financing, your chosen lender will check your credit report, creating a “hard inquiry.” This inquiry signals to other financial institutions that you’re actively seeking new credit. These institutions can then purchase your information from credit bureaus like Equifax, Experian, and TransUnion.
Numerous types of companies utilize trigger leads, including mortgage lenders, auto lenders, credit card providers, insurance companies, and personal loan providers. They use this information to directly market their products to you, hoping to gain your business.
The Legality and Logic of Trigger Leads
Although they might seem intrusive, trigger leads are perfectly legal under the Fair Credit Reporting Act, provided the purchasing company adheres to specific legal requirements. The Federal Trade Commission (FTC) and Consumer Finance Protection Bureau (CFPB) even see a potential benefit in this practice, believing it fosters competition among lenders and could lead you to more favorable terms.
Managing Trigger Leads
While you can’t entirely prevent trigger leads, there are ways to reduce unwanted contact:
– Opt-Out of Prescreened Offers: The Fair Credit Reporting Act (FCRA) gives you the right to opt out of prescreened offers for five years or permanently. You can do so online at www.optoutprescreen.com or by calling 1-888-5-OPTOUT (1-888-567-8688).
– Join the National Do Not Call Registry: This registry won’t eliminate all sales calls, but it can significantly reduce them. Register your phone number online at www.donotcall.gov or by calling 1-888-382-1222.
– Directly Contact Companies: If you continue to receive unwanted solicitations, reach out to the companies directly and request to be removed from their marketing lists.
Should You Opt Out?
Deciding whether to opt out depends on your preferences and circumstances. If you’re actively seeking new credit or insurance, these offers could expose you to competitive deals. However, if you’re not interested or simply dislike the solicitations, opting out might be the better choice.
Important Considerations
– Opting out of trigger leads doesn’t affect your credit score or your ability to obtain credit or insurance.
– It primarily stops pre-approved offers based on credit bureau lists. You may still receive marketing materials from other sources.
– If you change your mind, you can easily opt back into receiving prescreened offers.
By understanding trigger leads and the tools available to manage them, you can make informed decisions about how you want your personal information to be used and the types of offers you receive.
