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Breaking Down Consumer Debt Collection Complaints

consumer complaintsThe Bureau of Consumer Financial Protection [1] (formerly the Consumer Financial Protection Bureau [2]) has released a new Complaint Snapshot, exploring consumer complaints regarding modern debt-collection practices. The Bureau has received approximately 400,500 debt collection complaints since July 2011, amounting to 27 percent of the total complaints the bureau has received during that time period.

The most complained-about category in March 2018 was “credit or consumer reporting,” accounting for 37 percent of the 30,300 complaints received during that month. Debt collection [3] came in second, accounting for 27 percent of total complaints. Mortgage complaints came in third at around 10 percent of total complaints.

Credit or consumer reporting, debt collection, and mortgage [4] were the top three most complained-about consumer financial products and services, collectively representing approximately 74 percent of complaints submitted in March 2018, according to the BCFP.

The BCFP registered a total of 8,265 debt collection complaints in March 2018, up 14 percent month-over-month. The rolling 24-month average for debt collection complaints was 7,236. BCFP mortgage complaints in March totaled 2,804, an 11 percent month-over-month increase. The rolling 24-month average for mortgage complaints was 3,444.

States with the greatest complaint volume percentage increase from January 2017 - March 2017 to January 2018 - March 2018 were Mississippi (30 percent), Alaska (29 percent), and Louisiana (18 percent). The states showing the greatest decrease in complaint volume during those time periods were  South Dakota (-53 percent), North Dakota (-47 percent), and Maine (-41 percent).

During that window of time, Florida had the greatest complaint volume percentage increase of the five most populated states, coming in at 11 percent. Pennsylvania showcased the biggest decrease at -9 percent.

When it comes to the types of debt collection practices consumers complain about most, the BCFP reports that “attempts to collect a debt not owed” leads the pack at 39 percent. Seventeen percent of complaints involved issues about written notifications of debt, or not receiving such. “Communication tactics” also accounted for 17 percent of complaints, followed by “took of threatened to take negative or legal action” at 11 percent, “false statements or representation” at 10 percent, and “threatened to contact someone or share information improperly” at 6 percent.

To read the full BCFP Complaint Snapshot, click here [5].