CFPB Issues Report Analyzing Consumer Complaints Throughout Credit Life Cycle

Sep 29, 2021Federal Regulation, News

Last week, the Consumer Financial Protection Bureau (CFPB) released its “Consumer complaints throughout the credit life cycle, by demographic characteristics” report, which analyzes consumer complaint patterns by U.S. Census tract. The findings are based on nearly one million complaints received between 2018 and 2020.

“Today’s report confirms that the experiences and concerns of communities, with consumer financial products and services, vary by race and wealth,” said the bureau’s Acting Director, Dave Uejio. “Our consumer complaint data is a crucial tool for understanding varying consumer experiences, including across racial and economic divides.”

“Consumer complaints are integral to the CFPB’s work,” the report reads. “By collecting, investigating, and responding to consumer complaints, the CFPB hears directly from consumers and can better understand the types of challenges they are experiencing in the marketplace. The CFPB also has insight into how companies are responding to their customers’ concerns.”

The report found that complaints from wealthier communities and those with higher percentages of white residents were more often about loan origination and servicing of performing loans. The complaints from lower income communities and communities of color were more often about identity theft, credit reporting, and delinquent servicing.

Other findings from the report include that complaints about loan originations rose by nearly 50 percent in higher-income neighborhoods throughout 2020, largely due to mortgage complaints. Those neighborhoods also submitted complaints about loan origination at more than twice the rate of neighborhoods with higher numbers of Black consumers.

Lower income census tracts and those with a greater concentration of minority populations experienced greater rates of credit reporting complaints and delinquent servicing complaints. Lower income census tracts—at or below 40 percent of the area’s median income—submit nearly 30 percent more complaints per resident than census tracts around 100 percent of the area’s median income.

The CFPB plans to continue its research of consumer complaint data as part of its commitment to keep consumers and their varying experience with consumer financial products and services at the foundation of its work.

To read the full report, click here.

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