States Dialing in on Mortgage Trigger Leads

In a notable trend in state consumer financial regulation, state legislatures are increasingly seeking to regulate a variety of marketing and advertising practices, rather than limiting their regulatory focus limited to the actual terms of consumer financial transactions themselves. A growing number of states are seeking to regulate conduct that may occur long before a loan is ever consummated by enacting laws to regulate companies’ use of “trigger leads.” These “trigger leads” generally refer to consumer reports obtained by a mortgage company that a consumer did not apply for a loan with, where the issuance of the reports is triggered by inquiries made with a consumer reporting agency in response to an application for a mortgage with another lender. Companies use these reports as leads to market to consumers with whom they do not have a prior relationship.

Arkansas, Georgia, Idaho, Iowa, and Utah have each passed legislation in 2025 that regulates the use of trigger leads, and the Texas Department of Saving and Mortgage Lending promulgated regulations governing the use of “trigger leads” in late 2024. These six states join a handful of others that already regulate the use of mortgage trigger leads in similar ways.

According to proponents of these new laws, consumers are often unable to distinguish whether a call is from the mortgage company that received the consumer’s application or another company trying to solicit new business. Each of these new state laws seek to address consumer advocates’ concerns by requiring companies to make certain disclosures to consumers when using mortgage trigger leads. The laws in Arkansas, Georgia, Idaho, Iowa, and Texas also make contacting consumers who have opted out of prescreened offers of credit pursuant to the Fair Credit Reporting Act (“FCRA”) a violation of state law, and the laws in Arkansas, Georgia, Idaho, and Iowa prohibit making calls to consumers on the national Do-Not-Call registry.

Each of the new laws defines trigger leads (or mortgage trigger leads or prescreened trigger leads) in a substantially similar manner. Although Utah’s definition is the only of these six states to not provide a carve-out for reports obtained by a lender or servicer that holds or services existing indebtedness of the applicant, its definition is limited to reports given to third parties not affiliated with the consumer, effectively carving out consumer reports obtained firsthand from the meaning of trigger leads.

Arkansas

Arkansas House Bill 1184, which will go into effect on August 4, 2025, prohibits a person from using a mortgage trigger lead in a misleading or deceptive manner, including by failing to state the following six items in the initial communication with a consumer:

• the mortgage loan officer’s (“MLO”) name and mortgage company on behalf of whom the MLO is acting;
• a brief explanation of how the MLO or the MLO’s sponsor obtained the consumer’s contact information to make the communication, or an explanation of a mortgage trigger lead;
• that the solicitation is based on personal information about the consumer that was purchased from a consumer reporting agency without the knowledge or permission of the mortgage company with whom the consumer initially applied;
• that the MLO and the MLO’s sponsor are not affiliated with the creditor with whom the consumer initially applied;
• that the purpose of the communication is to solicit new business for the sponsor; and
• to make a firm offer of credit as provided by FCRA.

The Arkansas law also provides that the following practices are a violation of state law: soliciting or contacting a consumer who has opted out of prescreened offers of credit pursuant to FCRA, placing a telephone call to a consumer who has placed his or her contact information on a national Do-Not-Call registry, or knowingly using information from a mortgage trigger lead in violation of the new law or FCRA.

Georgia

Effective May 13, 2025, Georgia House Bill 240 prohibits the following acts and practices when using a mortgage trigger lead to solicit a consumer who has applied for a loan with another mortgage lender or mortgage broker:

• failing to state in the initial solicitation that the person is not affiliated with the mortgage lender or broker with which the consumer initially applied;
• failing in the initial solicitation to conform to state and federal law relating to prescreened solicitations using consumer reports, including the requirement to make a firm offer of credit to the consumer;
• using information regarding consumers who have opted out of the prescreened offers of credit or who have placed their contact information on the federal Do-Not-Call registry; or
• soliciting a consumer with an offer of certain rates, terms, and costs with the knowledge that the rates, terms, or costs will be subsequently changed to the detriment of the consumer.

The new Georgia law also prohibits any person transacting a mortgage business, including those required to be licensed or exempt from licensing, to engage in these unfair or deceptive acts or practices.

Idaho

Effective July 1, 2025, Idaho House Bill 149 prohibits the following acts and practices when solicitating a consumer for a residential mortgage loan based on information contained in a mortgage trigger lead:

• failing to clearly and conspicuously state in the initial phase of the solicitation that the solicitor is not affiliated with the lender or broker with which the consumer initially applied;
• failing to clearly and conspicuously state in the initial phase of the solicitation that the solicitation is based on personal information about the consumer that was purchased from a consumer reporting agency without the knowledge or permission of the lender or broker with which the consumer initially applied;
• failing, in the initial solicitation, to comply with FCRA’s provisions relating to prescreening solicitations that use consumer reports, including the requirement to make a firm offer of credit to the consumer; and
• knowingly or negligent using information from a mortgage trigger lead (a) to solicit consumers who have opted out of prescreened offers of credit under FCRA or (b) to place telephone calls to consumers who have placed their contact information on a federal or state Do-Not-Call list.

Iowa

Effective July 1, 2025, Iowa House File 857 prohibits financial institutions from engaging in an unfair or deceptive practice when using mortgage trigger lead information derived from consumer reports to solicit a consumer who has applied for a loan with a different financial institution. The bill deems the following practices as unfair or deceptive:

• in an initial phase of a solicitation from a lender or loan broker, the financial institution fails to clearly and conspicuously state that the financial institution is not affiliated with the financial institution with which the consumer initially applied;
• in an initial solicitation, the financial institution fails to conform to state and federal law relating to prescreened solicitations using consumer reports, including but not limited to the requirement to make a firm offer of credit to the consumer;
• the financial institution uses information regarding a consumer who has opted out of prescreened offers of credit or who has placed the consumer’s contact information on a federal Do-Not-Call list; and
• the financial institution solicits a consumer with an offer of certain rates, terms, or costs, but subsequently changes the rates, terms, or costs to the detriment of the consumer.

Utah

Effective May 7, 2025, Utah House Bill 99 prohibits a person transacting the business of residential mortgage loans from using prescreened trigger lead information to solicit a consumer who has applied for a mortgage loan with another financial institution if the person:

• fails to state in the initial solicitation that the person is not affiliated with the mortgage loan company (or broker) with which the consumer initially applied;
• fails in the initial solicitation to conform to state and federal law relating to solicitations using consumer reports, including the requirement to make a firm offer of credit to the consumer; or
• solicits a consumer with an offer of certain rates, terms, and costs with the knowledge that the person will subsequently change the rates, terms, or costs to the detriment of the consumer.

Texas

Texas adopted regulations in November of 2024 which provide that a mortgage company, mortgage banker, or sponsored mortgage loan originator acts in a fraudulent and dishonest manner when using a trigger lead in a misleading or deceptive manner. The regulations further provide that when using a trigger lead, failing to state the following five items in the initial communication with the consumer is misleading or deceptive for purposes of the regulation:

• the mortgage banker’s name;
• a brief explanation of how the mortgage banker obtained the consumer’s contact information to make the communication (i.e., an explanation of trigger leads);
• that the mortgage banker is not affiliated with the creditor to which the consumer made the credit application that resulted in the trigger lead; and
• that the purpose of the communication is to solicit new business for the mortgage banker. The regulations also provide that contacting a consumer who has opted out of prescreened offers of credit under FCRA and failing in the initial communication with the consumer to make a firm offer of credit as provided by FCRA are misleading and deceptive and therefore fraudulent and dishonest acts.

These new state laws are similar to federal legislation, S.B. 1467 and H.R. 2808, which passed the Senate and House, respectively, in June 2025. Although there are differences in the two pieces of legislation, the federal legislation would, if enacted, permit a consumer reporting agency to furnish a mortgage trigger lead only when the consumer has provided consent for the agency to share the information with the recipient or when the consumer has a prior a relationship with the recipient, such as being the lender or servicer for the consumer’s mortgage or a bank or credit union with whom the consumer has an account.

Companies’ use and practices with respect to mortgage trigger leads are the subject of increasing focus at both the state and federal level. As the list of states regulating the use of trigger leads grows, mortgage companies and other market participants should consider reviewing their policies and procedures for using these leads.