Report Also Includes In-Depth Look at Consumer Complaints in Denver, Colo.
WASHINGTON, D.C. – Today, the Consumer Financial Protection Bureau (CFPB) released its latest monthly consumer complaints snapshot, which highlights mortgage complaints. According to the report, consumers continue to face problems with mortgage servicing, particularly during certain circumstances, such as when they apply for a loan modification to avoid foreclosure. This month’s snapshot also highlights trends seen in complaints coming from the Denver, Colo. metro area. As of Sept. 1, 2015 the Bureau has handled over 702,900 complaints across all products.
“Despite strong protections that have been put in place to protect homeowners, this month’s complaint report shows consumers are still having problems when dealing with their mortgages,” said CFPB Director Richard Cordray. “The Bureau will continue to work to make sure that consumers are being treated fairly on their mortgage issues.”
The Monthly Complaint Report can be found at: http://www.consumerfinance.gov/reports/monthly-complaint-report-vol-3/
Product Spotlight: Mortgages
With a total value topping $10 trillion, the mortgage market is the largest consumer financial marketplace in the country. In 2014, the CFPB put in place strong consumer protections with mortgage rules that ensured lenders only offered mortgages that consumers could afford. Since the CFPB began accepting consumer complaints in 2011, the Bureau has received more mortgage-related complaints than any other type of financial product. As of Sept. 1, 2015 the Bureau had handled approximately 192,500 mortgage-related complaints. Some of the findings in the snapshot include:
- Continued problems preventing foreclosure: Over 50 percent of mortgage complaints have to do with problems consumers face when they are unable to make payments. Consumers complain of delays and a lack of information when applying for a loan modification. Additionally consumers complain that servicers often move forward with foreclosure proceedings while the consumer’s modification application is still under review.
- Lack of information when loans are transferred: Consumers report experiencing confusion and frustration about where to make payments when loans are transferred. When the loan transfers occur, consumers complain that payments often increase unexpectedly. Consumers also say that they do not feel properly informed about their loans being transferred in the first place.
- Trouble making payments: Nearly a third of mortgage complaints came from consumers saying that they have trouble making the proper payments on their mortgage loans. Consumers describe companies not accepting payments of anything less than the full balance owed, or finding that their payments were not properly applied despite instructions from the consumer.
- Most-complained-about companies: Wells Fargo, Bank of America, and Ocwen were the three companies about which the CFPB has received the most mortgage-related complaints. Between April and June 2015, the three companies averaged around 430 complaints per month.
Company-level complaint data in the report uses a three-month rolling average of complaints sent by the Bureau to companies for response. This data lags other complaint data in this report by two months to reflect that companies are expected to close all but the most complicated complaints within 60 days. After the CFPB forwards a company the complaint, the company also has 15 days to respond, confirming a commercial relationship with the consumer. Company level information should be considered in the context of company size.
National Complaint Overview
As of September 1, 2015 the CFPB has handled 702,900 complaints nationally. Some of the highlights from the statistics being published in this month’s snapshot report include:
- Complaint volume: For August 2015, the most-complained-about financial product or service was debt collection, representing about 29 percent of complaints submitted. Of the 25,732 complaints handled in August, approximately 7,582 of them were about debt collection. The second most-complained-about consumer product was credit reporting, accounting for approximately 5,733 complaints. Overall, the CFPB received 972 fewer complaints in August than in July.
- Product trends: In a year-to-year comparison, consumer loan complaints, which include pawn loans, title loans, and installment loans, showed the greatest percentage increase – 47 percent – nearly doubling from the same time last year. Payday loan complaints showed the greatest percentage decrease – 12 percent – over the same three month (June-August) time period between 2014 and 2015, going from 526 complaints in 2014 to 463 complaints in 2015.
- State information: Nebraska and Nevada experienced the greatest complaint volume increases from the same time last year by a considerable margin; the volume of complaints from Nebraska rose by 54 percent, while Nevada’s complaint volume increased by 45 percent. The next largest increase was North Carolina, where complaint volume rose by 36 percent compared to the same time period last year.
- Most-complained-about companies: The top three companies about which the CFPB received the most complaints remain unchanged from last month’s report. From April through June 2015 Equifax, Experian, and Bank of America were the three most-complained-about companies.
Geographic Spotlight: Denver
This month, the CFPB highlighted the Denver, Colo. metro area, for the report’s geographic spotlight. As of Sept. 1, 2015, consumers in Colorado have submitted 11,500 of the 702,900 complaints the CFPB has handled. Of those complaints, 7,000 of them have come from consumers in the Denver metro area. Findings from the Denver complaints include:
- Mortgages are the most-complained-about product: Mortgage-related complaints have been the most-complained-about product in Denver metro area since the CFPB started taking complaints in July 2011. Of the 7,000 complaints submitted consumers in the Denver metro area, 27 percent of them have been related to mortgages.
- Denver complaint volume and type mirrors national trends: Debt collection and credit reporting are the second and third most complained about financial products in the Denver metro area, following mortgages. As the top three most-complained-about products, Denver mirrors national trends.
- Most-complained-about companies: Credit reporting companies Equifax and Experian were the two most-complained-about companies nationally as well as from Denver-area consumers over a twelve-month period. Additionally, while not among the most-complained-about nationally, U.S. Bancorp is the tenth most-complained-about company by Denver residents from July 2014-June 2015.
The Dodd-Frank Wall Street Reform and Consumer Protection Act, which created the CFPB, established consumer complaint handling as an integral part of the CFPB’s work. The CFPB began accepting complaints as soon as it opened its doors four years ago in July 2011. It currently accepts complaints on many consumer financial products, including credit cards, mortgages, bank accounts, private student loans, vehicle and other consumer loans, credit reporting, money transfers, debt collection, and payday loans.
The Bureau expects companies to respond to complaints and to describe the steps they have taken or plan to take to resolve the complaint within 15 days of receipt. The CFPB expects companies to close all but the most complicated complaints within 60 days.
In June 2012, the CFPB launched its Consumer Complaint Database, which is the nation’s largest public collection of consumer financial complaints. When consumers submit a complaint they have the option to share publicly their explanation of what happened. For more individual-level complaint data and to read consumers’ experiences, go to the Consumer Complaint Database at: www.consumerfinance.gov/complaintdatabase/.
To submit a complaint, consumers can:
- Go online at www.consumerfinance.gov/complaint/
- Call the toll-free phone number at 1-855-411-CFPB (2372) or TTY/TDD phone number at 1-855-729-CFPB (2372)
- Fax the CFPB at 1-855-237-2392
- Mail a letter to: Consumer Financial Protection Bureau, P.O. Box 4503, Iowa City, Iowa 52244
- Additionally, through “Ask CFPB,” consumers can get clear, unbiased answers to their questions at consumerfinance.gov/askcfpb or by calling 1-855-411-CFPB (2372).
The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives. For more information, visit consumerfinance.gov.