Skip to main content

CFPB Report Faults Mortgage Industry, But Data is Not Dramatic

Phil Hall
Sep 22, 2015
CFPB Logo

The Consumer Financial Protection Bureau (CFPB), ignoring last week’s criticism from the Federal Reserve’s Office of the Inspector General that its consumer complaint database was riddled with inaccuracies, has pressed ahead by citing its database as the foundation for a new round of fault-finding aimed at the mortgage industry.

In announcing its latest findings, CFPB Director Richard Cordray suggested that lenders and servicers are not paying attention to his agency’s guidelines.

“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 Cordray. “The Bureau will continue to work to make sure that consumers are being treated fairly on their mortgage issues.”

Yet the report itself found that most complaints fielded by the CFPB between June and August involved debt collection (7,767 complaints filed with the database) and credit reporting bureaus (5,535 filed complaints), with mortgage-related complaints coming in a distant third at 4,584. In a year-over-year measurement, the volume of mortgage-related complaints registered with the CFPB grew a mere seven percent, compared with complaints aimed at consumer lending entities (47 percent), credit bureaus (39 percent), money transfer operations (36 percent) and credit card providers (20 percent).

In taking a specific aim at mortgage companies, the primary volume of complaints involved servicing matter, with specific problems that arise when a borrower cannot make payments (53 percent) and the payment process itself (30 percent). The origination side had relatively few complaints in comparison, with the loan application (eight percent), signing the agreement (four percent) and receiving the credit offer (two percent) among the problems cited.

On a year-over-year basis for the June-to-August period, the states experiencing the greatest increase in mortgage-related complaints filed with the CFPB were Nebraska (50 percent), Rhode Island (47 percent), and Alabama (46 percent). While this may seem dramatic, the exact numbers were rather puny: for example, seven people in Nebraska complained in 2014, with 11 in 2015. The numbers were equally small for Rhode Island (11 in 2014 versus 16 in 2015) and Alabama (23 in 2014 versus 34 in 2015).

What the CFPB did not emphasis was that 18 states saw fewer year-over-year complaints related to mortgages, while eight states saw year-over-year complaints increase by 10 percent or less – and in states such as Wisconsin, Idaho and Hawaii, the year-over-year bump-up consisted of a single registered complaint.

As for the most-complained about mortgage companies, four of the top five (Wells Fargo, Bank of America, Ocwen and JPMortgage Chase) saw the level of year-over-year complaints fall. Carrington Mortgage saw the greatest increase in year-over-year complaints with 117 percent, but that translated into 19 complaints registered in a three-month period last year versus 42 in the same period this year.

Published
Sep 22, 2015
R.I. Mortgage Broker Pleads Guilty To $6M Ponzi Scheme

Decade-long scheme was used to finance a lavish lifestyle.

Regulation and Compliance
Sep 30, 2022
Fannie Mae Names Almodovar Its New CEO

Financial services veteran brings more than 30 years experience and a strong commitment to affordable housing.

Regulation and Compliance
Sep 29, 2022
OCC Fines Sterling Bank & Trust $6M Over Mortgage Fraud

Bank, parent company remain under criminal investigation by Justice Department and SEC.

Regulation and Compliance
Sep 27, 2022
Federal Court Shutters Sham Mortgage Relief Operation

FTC, California agency accuse 2 business owners of scam that cost consumers millions of dollars.

Regulation and Compliance
Sep 22, 2022
CFPB Seeks Input On Creating New Mortgage Products

Agency seeks information on refinances, mortgage products to promote competition and support household financial stability.

Regulation and Compliance
Sep 22, 2022
The Fed Raises Interest Rate 0.75% For The 3rd Time

Chairman said housing market may have to go through "a correction" to return to balance.

Regulation and Compliance
Sep 21, 2022