CHLA Asks CFPB To Use FCRA To Rein In Abusive Trigger Leads
The Community Home Lenders of America (CHLA) today sent a letter to the Consumer Financial Protection Bureau asking the CFPB to use the Fair Credit Reporting Act (FCRA) to effectively adopt the trigger lead provisions that were just dropped from the National Defense Authorization Act (NDAA) conference report.
The CHLA letter referred to letters CHLA has sent to the CFPB since November 2022 highlighting the “firm offer of credit” requirement in conjunction with trigger leads. CHLA went on to argue that it does not see how a firm can meet this requirement without having debt to income and loan to value information on a loan – unless the lender has had a relationship with the borrower (the standard under which trigger leads would have been allowed in the NDAA provision).
The CHLA letter went on to ask CFPB to act: “Therefore, CHLA asks the CFPB to issue guidance (if necessary through rulemaking) stating that the presumption is that a mortgage trigger lead solicitation does not meet the firm offer of credit requirement – and is therefore not permissible – UNLESS the mortgage lender has originated the borrower’s existing mortgage loan or the lender has an existing relationship with the borrower.”
The CHLA letter concluded by noting that “there is overwhelming bi-partisan support for ending abusive trigger lead solicitations” and in the wake of the NDAA language being dropped at the last minute, calling on the CFPB to act by using authority under the FCRA to finish the job.
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