A bill designed to curb abusive spam calls to prospective homebuyers was advanced by the U.S. House Committee on Financial Services during a legislative markup session Tuesday. The move clears the path for a debate and vote on the House floor.
The legislative action was confirmed in a statement provided to Scotsman Guide by Jim Nabors, president of the National Association of Mortgage Brokers (NAMB).
The bipartisan Homebuyers Privacy Protection Act, introduced by Rep. John Rose, R-Tenn., and Rep. Ritchie Torres, D-N.Y., targets “trigger leads,” a term for when credit reporting agencies sell prospective homebuyers’ contact info to third-party mortgage brokers, lenders and other businesses following a credit check. Identical bipartisan legislation that would ban that practice was introduced in the Senate on April 10.
Valerie Saunders, NAMB’s chief executive strategist, told Scotsman Guide that the House version of the bill has had minor amendments since it was introduced. Specifically, the effective date of the legislation was pushed out to 180 days after enactment if the bill becomes law. Also, the amended version calls for a study to be conducted on the value of trigger leads received via text message.
Saunders said the changes were prompted by concerns expressed by Rep. Young Kim, R-Calif., who maintained that credit agencies would need more time to adjust to the revised law. Kim also requested the study to see if text messages are less burdensome to consumers than phone calls, according to Saunders.
Nabors, the NAMB president, praised the committee’s unanimous decision to report the bill for consideration by the full House.
“Today marks a significant victory for consumer protection and responsible lending practices,” Nabors said in a statement. “This critical legislation represents a meaningful step toward safeguarding the personal financial information of millions of prospective homebuyers across the nation.”
Nabors continued: “By curbing the misuse of consumer data obtained through credit inquiries, this legislation not only enhances transparency and accountability but also supports a fairer and more respectful homebuying experience. We are encouraged to see lawmakers take action that aligns with the best interests of both borrowers and mortgage professionals alike.”
‘Unprecedented’ industry support
The legislation has broad support across the mortgage and housing industries. A coalition of 16 industry associations — including NAMB, the American Bankers Association, the Mortgage Bankers Association and the National Housing Conference — sent a joint letter to House Financial Services Committee leaders on Tuesday advocating for passage of the bill.
“Entities that have no relationship with the consumer are currently buying trigger leads as soon as a customer applies for a mortgage — and then bombarding the applicant with hundreds of confusing calls that seek to lure them away from their chosen lenders,” the letter stated.
The associations expressed their “strong support” for the legislation that would “stop the abusive use of trigger leads while narrowly preserving them for legitimate, transparent and accountable uses.”
Saunders said that having such wide industry support for an issue is not typical.
“It’s kind of an unprecedented situation where you have so many trade associations who all have a similar goal in mind and are pretty much standing united on having something done to really curtail this practice,” Saunders said.
