Your personal data are worth about 7 cents --
so get yourself off of those solicitation lists
By Michael D. Larson • Bankrate.com

Douglas Bendt wants homeowners to give their hard-earned money to people they've never met. It's nothing personal for the president of Mortgage Risk Assessment Corp. in Jersey City, N.J., -- it's his job.

Bendt, along with other list managers and brokers, operate behind the scenes in the mortgage-lending industry. Scouring courthouses, credit bureau files, magazine subscription records and other information sources, they find credit-needy consumers and charge prospect-hunting lenders anywhere from a few pennies to a buck a name. Chances are, the fruits of their labor are piling up on your kitchen table right now.

"They say, 'Let me know who the homeowners are,' " Bendt says. "Or a bank or mortgage company would inquire about a particular program. Say it's a second mortgage solicitation or home equity line of credit. They would work with us in developing some guidelines. They might want people who have maybe lived in their home for at least three years, have to have at least 20 percent equity and at least $25,000 of equity."

"We'd do a poll of our database to find out how many records meet those criteria, then either provide all of them or some of them."

Tailoring the targeting
Knowing whom to target with loan offers has always been important to mortgage companies, but it's even more so today. With interest rates markedly higher than they were in 1998 and 1999, lenders can't afford to waste time on consumers who don't want a loan. Consumers, meanwhile, don't want to be bothered by companies whose services they don't need. They can get their names on opt-out lists through one of several ways we'll describe. But businesses such as Bendt's try to eliminate the need for that by tracking down people who are likely to respond to telephone or direct mail pitches before they receive them.

These mortgage list companies fall into a few subcategories. Some are list compilers, who gather basic public record information about homeowners. That can include things such as mortgage amounts, lender names and borrower names and addresses. Every time somebody takes out a home loan, the information gets recorded at a local courthouse or other county office and compilers actually trudge through each one to gather what they need.

List management companies, on the other hand, work for magazine publishers and other similar parties. They might take a list of subscribers, for instance, and offer it for sale to list brokers. Those brokers, in turn, are responsible for pulling together data from compilers and managers and crunching it to come up with suitable prospects, based on criteria that clients provide.

"I sell the lists, the leads," says Joseph Dinner, owner of Joseph Dinner Custom List Broker in Bayside, N.Y. "Other companies in the field do all the research."

Credit bureau data available, too
Some mortgage companies just want to send general solicitations and need nothing but the bare-bones public record data. They can get a list of names for as little as $20 to $70 per thousand. But others want to narrow their prospect list so that it excludes people who, say, were 30-days late with a monthly mortgage payment any time during the last two years. They need credit bureau information to screen for such events and that means they have to get the help of list companies with access to credit bureau data.

That's not as difficult as it sounds because several companies have arrangements with the credit bureaus, Experian Information Solutions Inc., Equifax Inc. and Trans Union LLC. Those deals allow the list managers to access consumer credit histories, within certain limits. They can only do so, for example, if the lender is making a firm commitment to extend a loan. That's why offers using credit bureau data are usually made on a "pre-approved" basis and contain specific terms and loan amounts.

"To use the credit bureau data, you have to have something at risk and part of that is a pre-approval. It has to be a firm offer of credit: 'If you meet these criteria, we will be obligated to make the loan,' " says James C. Dekle, president of MarketTouch in Alpharetta, Ga. Because credit-screened names can go for as much as $200 per thousand, he says it's usually the larger, nationwide lenders who want them.

"Typically, the smaller people are using offers that aren't pre-approved. One, they're much cheaper and two, they have more flexibility in the offer in the language they can use. They can be more saleslike rather than less."

You CAN get off of those lists
Of course, not everyone wants mail from mortgage companies cluttering their desks. These homeowners can combat mortgage solicitations just like they would any other type of direct mail or telemarketing -- by getting in touch with the Direct Marketing Association.

The DMA trade group maintains an "opt out" list, which contains the names of consumers who don't want to receive offers. Bendt says that four times a year, his company compares its list with the one maintained by the DMA. Any names that appear on both won't be sent to Mortgage Risk Assessment clients.

Borrowers who don't want companies to be able to access their credit histories for pre-approved offers can contact the credit bureaus, too. A toll-free number will get their names on all three of the companies' opt out lists.

"We're very sensitive to the privacy issues and what information we have," says Michael Young, president of NCRI List Management in Englewood Cliffs, N.J.

Still, mortgages are public documents. That means your name will always be floating out there in the ether somewhere, even if nobody but the county clerk cares.