Iowa passed a bill enacting provisions with respect to mortgage trigger leads. Under the bill, a financial institution may not use an unfair or deceptive practice when using prescreened mortgage trigger lead information derived from a consumer report to solicit a borrower who has applied for a loan with a different financial institution. A financial institution is deemed to have engaged in an unfair or deceptive practice if the financial institution:
- Fails to state in the initial solicitation that the financial institution is not affiliated with the financial institution with which the borrower initially applied;
- Fails 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 borrower);
- Uses information regarding a borrower who has opted out of prescreened offers of credit or who has placed the borrowers contact information on a federal do-not-call registry; or
- Solicits a borrower with an offer of certain rates, terms, and costs, but subsequently changes the rates, terms, or costs to the detriment of the borrower.
“Mortgage trigger lead” means a consumer report obtained under the Fair Credit Reporting Act where the issuance of the consumer report is triggered by an inquiry made with a consumer reporting agency in response to an application for credit secured by real property. The bill becomes July 1, 2025.
Click to view the Iowa House Bill 857: https://www.tenaco.com/wp-content/uploads/2025/05/IA-HB-857-04-19-25.pdf
